S-4

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Table of Contents
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

As filed with the Securities and Exchange Commission on April 7, 2011

Registration No. 333-

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

Form S-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933

CPI International Holding Corp.

*And the Subsidiary Guarantors listed in the table below
(Exact name of registrant parent guarantor as specified in its charter)

Delaware
(State or Other Jurisdiction of Incorporation or Organization) 3670
(Primary Standard Industrial Classification Code Number) 90-0649687
(I.R.S. Employer Identification No.)

811 Hansen Way
Palo Alto, California 94303-1110
(650) 846-2900

CPI International, Inc.
(Exact name of registrant issuer as specified in its charter)

Delaware
(State or Other Jurisdiction of Incorporation or Organization) 3670
(Primary Standard Industrial Classification Code Number) 80-0676283
(I.R.S. Employer Identification No.)

811 Hansen Way
Palo Alto, California 94303-1110
(650) 846-2900
(Address, Including Zip Code, and Telephone Number, Including Area Code, of Registrant's Principal Executive Offices)
Joel A. Littman
c/o CPI International, Inc.
811 Hansen Way
Palo Alto, California 94303-1110
(650) 846-2900
(Name, Address, Including Zip Code, and Telephone Number, Including Area Code, of Agent For Service)

Copies of all communications to:

Jennifer A. Bensch Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
Four Times Square
New York, New York 10036-6522
(212) 735-3000
(212) 735-2000 (facsimile)

Approximate date of commencement of proposed sale to the public: As soon as practicable after this registration statement becomes effective.

If the securities being registered on this form are being offered in connection with the formation of a holding company and there is compliance with General Instruction G, check the following box. o

If this form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

If this form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering. o

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of "large accelerated filer," "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer o Accelerated filer o Non-accelerated filer ý
(Do not check if a
smaller reporting company) Smaller reporting company o

If applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this transaction:

Exchange Act Rule 13e-4(i) (Cross-Border Issuer Tender Offer) o

Exchange Act Rule 14d-1(d) (Cross-Border Third-Party Tender Offer) o

CALCULATION OF REGISTRATION FEE

Title of Each Class of Securities to be Registered	Amount to be Registered	Proposed Maximum Offering Price per Unit	Proposed Maximum Aggregate Offering Price(1)	Amount of Registration Fee
8.00% Senior Notes due 2018	$215,000,000	100%	$215,000,000	$24,962.00
Guarantees related to the 8.00% Senior Notes due 2018	N/A	N/A	N/A	N/A(2)

(1)

Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457(f) promulgated under the Securities Act of 1933, as amended.

(2)

No separate consideration is received for the guarantees, and, therefore, no additional fee is required.

The Registrants hereby amend this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this Registration Statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to Section 8(a), may determine.

TABLE OF ADDITIONAL REGISTRANTS

Name of Subsidiary Guarantors*	State or Other Jurisdiction of Incorporation or Formation	Primary Standard Industrial Classification Code Number		I.R.S. Employer Identification Number
Communications & Power Industries LLC(1)	Delaware		3670		77-0405693
CPI Subsidiary Holdings LLC(2)	Delaware		3670		77-0407397
Communications & Power Industries International Inc.	Delaware		3670		77-0407398
Communications & Power Industries Asia Inc.	Delaware		3670		77-0407400
CPI Econco Division	California		3670		94-1724783
CPI Malibu Division	California		3670		95-2979251

*

Addresses and telephone numbers of principal executive offices are the same as those of CPI International, Inc., described above.

(1)

f/k/a, Communications & Power Industries, Inc.

(2)

f/k/a, CPI Subsidiary Holdings Inc.

The information in this prospectus is not complete and may be changed. We may not sell these securities until the registration statement filed with the Securities and Exchange Commission is declared effective. This prospectus is not an offer to sell these securities and is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

SUBJECT TO COMPLETION, DATED APRIL 7, 2011

PROSPECTUS

CPI INTERNATIONAL, INC.

Offer to exchange $215 million aggregate principal amount of 8.00% Senior Notes due 2018 (which we refer to as the "outstanding notes") for $215 million aggregate principal amount of 8.00% Senior Notes due 2018 (which we refer to as the "exchange notes"), which have been registered under the Securities Act of 1933, as amended (the "Securities Act"). When we use the term "notes" in this prospectus, the term includes the outstanding notes and the exchange notes, unless otherwise indicated or the context otherwise requires.

        The exchange offer will expire at 5:00 p.m., New York City time, on                        , 2011, unless we extend the exchange offer.

        Terms of the exchange offer:

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We will exchange a like principal amount of exchange notes for any or all outstanding notes that are validly tendered and not withdrawn prior to the expiration or termination of the exchange offer.

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You may withdraw tenders of outstanding notes at any time prior to the expiration or termination of the exchange offer.

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The terms of the exchange notes are substantially identical to those of the outstanding notes, except that the transfer restrictions and registration rights relating to the outstanding notes do not apply to the exchange notes.

•

The exchange of outstanding notes for exchange notes will not be a taxable transaction for U.S. federal income tax purposes. You should see the discussion under the caption "Certain United States Federal Income Tax Considerations" for more information.

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We will not receive any proceeds from the exchange offer.

•

We issued the outstanding notes in a transaction not requiring registration under the Securities Act, and as a result, their transfer is restricted. We are making the exchange offer to satisfy your registration rights as a holder of the outstanding notes.

        There is no established trading market for the exchange notes or the outstanding notes.

        Each broker-dealer that receives exchange notes for its own account pursuant to the exchange offer must acknowledge that it will deliver a prospectus in connection with any resale of such exchange notes. The letter of transmittal states that by so acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an "underwriter" within the meaning of the Securities Act. This prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of exchange notes received in exchange for outstanding notes where such outstanding notes were acquired by such broker-dealer as a result of market-making activities or other trading activities. We have agreed that, for a period of 180 days after the Expiration Date (as defined herein), we will make this prospectus available to any broker-dealer for use in connection with any such resale. See "Plan of Distribution."

See "Risk Factors" beginning on page 19 for a discussion of risks you should consider prior to tendering your outstanding notes for exchange.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus. Any representation to the contrary is a criminal offense.

The date of this prospectus is                        , 2011.

Table of Contents

Special Note Regarding Forward-Looking Statements	iii
Summary	1
Risk Factors	19
Use of Proceeds	35
Capitalization	36
Unaudited Pro Forma Condensed Consolidated Financial Information	37
Selected Historical Consolidated Financial Information	48
Management's Discussion and Analysis of Financial Condition and Results of Operations	52
Business	80
Management	97
Executive Compensation	100
Security Ownership of Certain Beneficial Owners and Management	130
The Transactions	132
Certain Relationships and Related Party Transactions	133
Description of the Senior Secured Credit Facilities	134
The Exchange Offer	136
Description of the Exchange Notes	145
Certain United States Federal Income Tax Considerations	193
Plan of Distribution	194
Certain ERISA Considerations	195
Legal Matters	196
Experts	196
Where You Can Find Additional Information	196
Index to Consolidated Financial Statements	F-1

i

MARKET AND INDUSTRY DATA

        Market data and other statistical information used throughout this prospectus are based on independent industry publications, government publications, reports by market research firms or other published independent sources or based upon our estimates using such sources when available. While we believe that such information and estimates are reasonable and reliable, we have not independently verified any of the data from third-party sources, and neither we nor the initial purchasers can guarantee the accuracy or completeness of the information. Similarly, our internal research is based upon our understanding of industry conditions, and such information has not been verified by any independent sources.

USE OF NON-GAAP FINANCIAL MEASURES

        We have included certain non-GAAP financial measures in this prospectus, including EBITDA, which represents earnings before net interest expense, provision for income taxes and depreciation and amortization, and Adjusted EBITDA, which represents EBITDA adjusted to exclude certain unusual or non-recurring items and certain non-cash items. Adjusted EBITDA as defined in this prospectus is not the same as that used in the indenture governing the notes or our senior secured credit facilities. We believe that U.S. GAAP-based (based on generally accepted accounting principles in the United States) financial information for leveraged businesses such as ours should be supplemented by EBITDA and Adjusted EBITDA so that investors better understand our financial performance in connection with their analysis of our business. We believe that EBITDA is useful to assess our ability to generate cash from operations sufficient to pay taxes, to service debt and to undertake capital expenditures. In addition, we believe that Adjusted EBITDA is a useful financial metric to assess our operating performance from period to period by excluding certain items that we believe are not representative of our core business. We use EBITDA for business planning purposes and in measuring our performance relative to that of our competitors.

        We believe EBITDA and Adjusted EBITDA are measures commonly used by securities analysts and investors to evaluate our performance and that of our competitors and other leveraged businesses. EBITDA and Adjusted EBITDA are not presentations made in accordance with U.S. GAAP and should not be considered as alternatives to net income (loss), operating income or any other performance measures derived in accordance with U.S. GAAP as measures of operating performance or operating cash flows as measures of liquidity. Our use of the terms EBITDA and Adjusted EBITDA varies from others in our industry. Our presentation of EBITDA and Adjusted EBITDA should not be construed to imply that our future results will be unaffected by unusual or non-recurring items.

        EBITDA and Adjusted EBITDA have important limitations as analytical tools and you should not consider them in isolation or as substitutes for analysis of our results as reported under U.S. GAAP. For example, EBITDA and Adjusted EBITDA:

•

exclude certain tax payments that may represent a reduction in cash available to us;

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do not reflect any cash capital expenditure requirements for the assets being depreciated and amortized that may have to be replaced in the future;

•

do not reflect changes in, or cash requirements for, our working capital needs; and

•

do not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on our debt.

ii

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

        This prospectus contains forward-looking statements, within the meaning of securities laws, that relate to future events or our future financial performance. In some cases, readers can identify forward-looking statements by terminology such as "may," "will," "should," "expect," "plan," "anticipate," "believe," "estimate," "predict," "potential" or "continue," the negative of such terms or other comparable terminology. These statements are only predictions. Actual events or results may differ materially.

        Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance or achievements. Moreover, neither we nor any other person assumes responsibility for the accuracy and completeness of the forward-looking statements. Forward-looking statements are subject to known and unknown risks and uncertainties, which could cause actual results to differ materially from the results projected, expected or implied by the forward-looking statements. These risk factors include, without limitation, risks associated with:

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competition in our end markets;

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our significant amount of debt and our ability to refinance our debt;

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changes or reductions in the United States defense budget;

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currency fluctuations;

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goodwill impairment considerations;

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customer cancellations of sales contracts;

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U.S. Government contracts;

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export restrictions and other laws and regulations;

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international laws;

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changes in technology;

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the impact of unexpected costs;

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the impact of a general slowdown in the global economy;

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the impact of environmental laws and regulations; and

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inability to obtain raw materials and components.

        We are under no duty to update any of the forward-looking statements after the date of this prospectus to conform such statements to actual results or to changes in our expectations. The information in this prospectus is not a complete description of our business or the risks and uncertainties associated with your investment in the notes. You should carefully consider the various risks and uncertainties that impact our business and the other information in this prospectus and, in particular, information appearing under the headings "Summary," "Risk Factors," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and "Business."

iii

SUMMARY

This summary highlights key aspects of the information contained elsewhere in this prospectus and may not contain all of the information you should consider before exchanging your outstanding notes for exchange notes. You should read this summary together with the entire prospectus, including the information presented under the heading "Risk Factors," "Unaudited Pro Forma Condensed Consolidated Financial Information" and the historical financial statements and related notes included elsewhere in this prospectus.

On February 11, 2011, CPI International LLC (formerly, CPI International, Inc., "Predecessor"), a then Delaware corporation and publicly traded company, completed its merger with Catalyst Acquisition, Inc. ("Merger Sub"), a Delaware corporation and wholly owned subsidiary of CPI International, Inc. (formerly, CPI International Acquisition, Inc., "CPII"), a Delaware corporation, whereby Merger Sub merged with and into Predecessor (the "Merger"), with Predecessor continuing as the surviving corporation and a wholly owned subsidiary of CPII. The Merger was effected pursuant to the Agreement and Plan of Merger, dated as of November 24, 2010, among Predecessor, CPII and Merger Sub (the "Merger Agreement"). Immediately following the consummation of the Merger and related transactions, Predecessor was converted into a limited liability company and liquidated, and CPI International Acquisition, Inc. changed its name to CPI International, Inc.

As used herein, unless the context indicates or otherwise requires, (i) for periods prior to the Merger, the terms "we," "us," "our," and "Company" refer to Predecessor and its consolidated subsidiaries, and for periods after the Merger, those terms refer to CPII, its consolidated subsidiaries and, where the context so requires, its direct and indirect parent companies, (ii) the term "Veritas Fund" refers to The Veritas Capital Fund IV, L.P. and (iii) the terms "Veritas Capital" and "Sponsor" refer collectively to The Veritas Capital Fund IV, L.P., The Veritas Capital Fund III, L.P. and their affiliates, including CICPI Holdings LLC. See "—The Transactions." Our ultimate parent, CPI International Holding LLC ("Holding LLC"), owns all of the outstanding common stock of CPI International Holding Corp. ("Parent"), which in turn owns all of the outstanding common stock of CPII, which in turn owns all of the outstanding equity interests of Communications & Power Industries LLC (formerly, Communications & Power Industries, Inc., "CPI") and Communications & Power Industries Canada Inc. ("CPI Canada"), our main operating subsidiaries. Holding LLC, Parent and CPII are holding companies with no material assets or operations other than their respective direct or indirect equity interests in CPI and CPI Canada and activities related thereto.

Our fiscal year 2010 ended on October 1, 2010, and our first quarter of fiscal year 2011 ("Q1 2011") ended on December 31, 2010. See "Management's Discussion and Analysis of Financial Condition and Results of Operations."

Our Company

        We are a leading provider of microwave, radio frequency ("RF"), power and control products for critical applications in the defense, communications, medical and scientific industries. We develop, manufacture and distribute products used to generate, amplify, transmit and receive high-power/high-frequency microwave and RF signals and/or provide power and control for various defense and commercial applications. Our products are used for transmitting radar signals for threat tracking and navigation; transmitting decoy and jamming signals for electronic warfare; transmitting and amplifying voice, data and video signals for broadcasting, data links, the Internet, flight testing and other types of communications; providing power and control for medical diagnostic imaging; generating microwave energy for radiation therapy in the treatment of cancer; and for various industrial and scientific applications.

        We have an extensive portfolio of more than 4,500 products that includes a wide range of vacuum electron devices ("VEDs"), satellite communications amplifiers, medical x-ray generators, advanced antenna technology, solid state devices, and various electronic power supply and control equipment.

1

Products generally have selling prices ranging from $2,000 to $200,000, with certain limited products priced over $1,000,000.

        We estimate that our products are currently installed on more than 125 U.S. defense systems and more than 180 commercial systems. Both defense and commercial applications require the generation, control and transmission of high-power and high-frequency microwave and RF signals for which VED products are the most efficient technology. Our products are critical elements of high-priority U.S. and foreign military programs and platforms, including numerous airborne, ship-borne and ground-based platforms. In addition to our strong presence in defense applications, we have successfully applied our key technologies to commercial end markets, including communications, medical, industrial and scientific applications, which provide us with a diversified base of sales. Revenues during fiscal year 2010 were split approximately evenly between defense and commercial applications.

        We believe the majority of our VED products are consumable with an average life of between three and seven years, and once they are installed in original equipment, they generate recurring sales of spares and repairs. We regularly work with our customers, often utilizing customer-funded R&D programs to create and upgrade customized products with enhanced bandwidth, power and reliability. We estimate that approximately 36% of our total sales for fiscal year 2010 were generated from sales of spares and repairs, including upgraded replacements for existing products, providing us with a relatively stable business that is less vulnerable to dramatic shifts in market conditions. In addition, in fiscal 2010 we generated approximately 58% of our total sales from products for which we believe that we are the sole provider to our customers.

        We are organized into six divisions operating five manufacturing facilities in North America. We sell and service our products to customers globally through our internal sales, marketing and service force of approximately 145 professionals and 64 external sales organizations. Products are sold directly to the U.S. Department of Defense ("DoD"), foreign military services and commercial customers, as well as to original equipment manufacturers ("OEMs") and systems integrators for ultimate sales to those customers. The U.S. Government is our only customer that accounted for more than 10% of our sales in fiscal year 2010.

        In fiscal year 2010 and Q1 2011, we generated total sales of $360.4 million and $89.0 million, respectively, net income of $6.7 million and $2.2 million, respectively, and Adjusted EBITDA of $61.6 million and $13.2 million, respectively. See note (6) under "Summary Historical and Pro Forma Financial Information" for additional information regarding Adjusted EBITDA.

Our End Markets

        Approximately half of our product sales for fiscal year 2010 were for U.S. and foreign government and military end use. We are one of three companies in the United States that have the facilities and expertise to produce a broad range of high-power microwave products customized to the demanding specifications required for advanced military applications. Defense applications of our products include transmitting and receiving radar signals for locating and tracking threats, weapons guidance and navigation, as well as transmitting decoy and jamming signals for electronic warfare. Key defense platforms on which we provide mission-critical components include the Aegis Combat System; Phalanx and Hawk radar systems; ALE-50 airborne and MK-53 NULKA shipboard decoy systems; SIRFC on-board jamming system; and many of the U.S. military radar and electronic warfare systems in service. In recent years, we have expanded our focus in the communications market to include military communications applications, as we believe that there is a significant and growing market for our products for these applications. Military communications applications now make up a growing portion of our total communications business, and approximately one-third of our total communications sales in fiscal year 2010 were for military communications purposes. We believe satellite communication will be a critical element for supplying real time, high data-rate communications, intelligence and battlefield

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information to the front-line soldier. We currently provide satellite communication amplifiers for military platforms such as the Warfighter Information Network—Tactical ("WIN-T") and Navy Multiband Terminal ("NMT") systems. In addition, military data link communications systems use our products to transmit and receive real-time command and control, intelligence, surveillance and reconnaissance data between airborne platforms (including unmanned aerial vehicles ("UAVs")) and their associated ground-based and ship-based terminals. We currently provide the data links for several major UAV platforms and the Apache attack helicopter.

        In addition to our strong presence in defense applications, we have successfully applied our key technologies to commercial end markets, including communications, medical, industrial and scientific applications, which provide us with a diversified base of sales. Within the commercial communications end market, we offer one of the industry's most comprehensive lines of satellite communications amplifiers, with offerings for virtually every currently applicable frequency and power requirement. We estimate that we have a worldwide installed base of more than 25,000 satellite communications ("satcom") amplifiers. Furthermore, we are participating in the growing area of Ka-band for commercial satcom applications including conventional and high-definition television for direct-to-home satellite broadcast as well as satellite communications for broadband data communications. Key programs are ViaSat's Ka-band satellite-delivered broadband services and DirecTV's direct-to-home broadcast applications.

        Within the medical end market, we supply VEDs for high-end radiation therapy machines and x-ray generators. Radiotherapy treatment sales have grown in the last several years as major suppliers of therapy equipment have introduced a number of key technological advances that enable their equipment to treat a greater number of oncology-related problems. We believe this trend will drive continued growth in demand for our products. In addition, we believe that we are one of the leading independent suppliers of x-ray generators in the world, and we believe that this market provides long-term growth opportunities for us.

        The industrial market includes applications for a wide range of systems used for material processing, instrumentation and voltage generation, and we offer a number of specialized product lines to address this diverse market. We produce fully integrated amplifiers that include the associated high-power microwave devices used in instrumentation applications for electromagnetic interference and compatibility testing. Our products are also installed in the power supply modules of industrial equipment using RF energy to perform pipe and plastic welding, textile drying and semiconductor wafer fabrication. In addition, we have a line of industrial RF generators that use high-power microwave technology for various industrial heating and material processing applications.

        Our scientific market consists primarily of equipment used in reactor fusion programs and accelerators for the study of high-energy particle physics, referred to as "Big Science." Generally, in scientific applications, our products are used to generate high levels of microwave or RF energy to accelerate a beam of electrons in order to study the atom and its elementary particles. Our products are also used in research related to the generation of electricity from fusion reactions.

Our Competitive Strengths

        We believe we are well positioned in our end markets and that our key competitive strengths are:

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Leadership in Microwave and RF Technology.  Since 1948, we have been a leader in microwave technology. More than 60 years ago, the founders of the Company pioneered a breakthrough technology that led to the commercialization of radar. Since then, we have improved our solutions, enabling technological advances in radar, electronic warfare and communications systems, which have required higher-power and higher-frequency solutions, and we have been designing and producing cutting-edge products that specifically address the evolving needs of our customers. In response to our customers' needs, we have designed and developed microwave

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systems that provide what we believe is a market-leading combination of power, frequency, bandwidth, control and reliability for our commercial and military customers. We have maintained our technological and production expertise through our experienced team of scientists and engineers, our recurring investment in research and development, over half of which is customer-funded, and our focus on continuous process improvement. Our leadership in design and quality is demonstrated by what we believe are sole-source relationships with customers from whom we generated a majority of our sales in fiscal year 2010.

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Leading Market Positions in Attractive End Markets.  We have developed leading market positions across the end markets we serve by offering customers superior design expertise, product quality and customer service. We believe we are a market leader in the sale of high-power, high-frequency microwave devices and related products for the defense, communications, medical, industrial and scientific end markets.

•

Substantial Sole Provider Position.  Our market leading technology, customer focus, and long history as a reliable supplier to our government and commercial customers, have resulted in our products being designed into and installed on a large number of platforms and systems. We believe that in many cases we are the sole provider of high-power microwave equipment on these systems. In fiscal year 2010, we generated approximately 58% of our sales from products for which we believe we are the sole provider to our customers.

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Large Installed Product Base with Recurring Spares and Repairs Sales.  We provide products embedded within a large and growing installed base of defense systems and commercial systems. We estimate that our products are currently installed on more than 125 U.S. defense systems and more than 180 commercial systems. Furthermore, once our products have been designed and installed into a customer's system, high costs would have to be incurred by the customer in order to requalify a new supplier's component and redesign the customer's end product, which creates significant disincentives to switch to a competitor. This large installed base, high switching costs and our sole provider position enable us to capture a long-term stream of replacements, spares and repairs sales. We estimate that approximately 36% of our total sales for fiscal year 2010 were generated from recurring sales of replacements, spares and repairs.

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Diversified Sales Base.  Our sales are diversified by customer, by end market, by product and by geography. Our top 15 customers comprised less than 50% of total sales in fiscal year 2010, with only the U.S. Government accounting for more than 10% of our sales during such period. We sell our products to customers in five end markets: the radar and electronic warfare (defense), communications, medical, industrial and scientific markets. No end market represented more than 37% of total sales in fiscal year 2010. Within each of our markets, we also sell a variety of products. These products may be sold as stand-alone products or as part of a fully integrated subsystem. For example, we supply each U.S. Navy DDG-51 destroyer with many different products, ranging from coupled-cavity traveling wave tubes for the early warning radar system to power-grid replacement products and services. Our product diversification reduces our dependence on any one part of any market for our overall success and profitability. Finally, our leadership in our markets allows us to penetrate other important geographic markets, as evidenced by the fact that 36% of our total sales in fiscal year 2010 came from customers outside the United States. These international customers provide us with further diversification, as they span all of our end markets.

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Strong Cash Flow Generation and Low Capital Expenditures.  We generate substantial operating cash flow and have relatively low capital expenditures. For the three years ended October 1, 2010, our average annual net cash provided by continuing operating activities before cash interest expense, cash income tax and strategic alternative transaction expenses was $55.1 million, while average annual capital expenditures were $4.0 million. We expect capital

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expenditures to remain low as a percentage of total sales as we continue to actively manage our capital expenditure needs. For fiscal year 2010, capital expenditures equaled 1.2% of total sales.

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Strong and Experienced Management Team with a Successful Track Record.  Our management team averages more than 25 years experience with the Company and its predecessor, Varian Associates, Inc. Since assuming its leadership responsibilities in 2002, our management team has instilled a culture that places a heavy emphasis on cost consciousness, profitable growth, meeting goals and targets, and cash generation through efficient management of inventories, receivables, accounts payable and customer advances. In addition, management has consolidated several facilities, reduced labor costs, overhead and general and administrative expenses, and renewed the Company's commitment to operational excellence principles in its factories. During the tenure of our management team, our total sales increased from $251.2 million in fiscal year 2002 to $360.4 in fiscal year 2010, while our Adjusted EBITDA increased from $30.1 million in fiscal year 2002 to $61.6 million in fiscal year 2010.

Our Business Strategy

        Our goal is to continually improve our position as a leading supplier of products and systems into our core defense, medical, commercial and scientific markets. Our strategies to achieve this objective include:

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Expanding Our Business in the Emerging Military Communications Market.  We believe that real-time network communications between intelligence agencies, military commands and soldiers on the front lines will play an increasingly critical role in the U.S. military and that the procurement of new military communications systems will be a critical component of this trend. Microwave technology is well suited to provide the significant bandwidth required to enable the rapid and seamless transfer of large quantities of voice, video and other forms of information that are critical to military communications. We believe we are well positioned to continue to be a key supplier of microwave technology for the growing military satellite communications market, having made significant investments over the past several years to bring to market internally developed, proprietary microwave solutions tailored for military satellite communications use.

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Supporting Other Emerging Military Initiatives.  We believe the DoD is increasingly exploring high-power microwave solutions for a growing number of threat countermeasures and non-lethal weapons applications. We offer many products and are working with the military on new products for many of these applications, including next-generation electronic warfare systems that transmit decoy and jamming signals to deceive an enemy threat. In addition, the recent proliferation of non-traditional weapons has led to the exploration of technologies that can disable or destroy these devices. High-power microwave technology has shown a significant promise as a countermeasure against Improvised Explosive Devices ("IEDs"), and we expect that the DoD will actively pursue high-power technology solutions in this area.

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Developing and Expanding Technologies.  Through a combination of customer-funded research and development and our own internal research and development efforts, we intend to continue our focus on the development of our key technologies in core programs to increase market share and in adjacent, high-growth areas with significant long-term potential, including UAV technology, advanced radar applications, solid-state satcom amplifiers, next-generation x-ray machines and other complementary markets. We continue to analyze emerging technologies and aggressively pursue related market opportunities. For example, we have greatly increased our investment in solid-state technology for power amplifiers to address new mobile satcom applications. In addition, in the medical market we have recently introduced new x-ray generators with image processing systems to assist customers in their migration from film-based

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radiology systems to digital radiology systems. In fiscal year 2010, our total research and development spending was approximately $28.5 million, of which $12.4 million was internally funded and $16.1 million was customer-funded.

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Pursuing Attractive Commercial Opportunities.  We intend to develop new products to pursue growth areas in the commercial markets we serve. Recent examples of our product innovation include the introduction of a line of SuperLinear® high-powered, satellite communications amplifiers, which are more efficient, use less prime power and generate less heat, making them smaller and lighter and, therefore, better suited for modern, compact communications systems, as well as being more environmentally friendly, than comparable amplifiers. In addition, we provide high-powered Ka-band amplifiers for the growing area of commercial communications services via satellite, including the latest broadband (Internet) and HDTV applications. In the medical market, we have recently introduced new products, including x-ray generators with image processing systems as mentioned earlier.

•

Leveraging Incumbent Relationships.  We intend to leverage our relationships with the U.S. Government, prime defense contractors and key commercial customers by continuing to deliver high levels of performance on our existing contracts, which will help to preserve our access to a valuable stream of spares and repairs business and enhance our ability to win new, upgrade and follow-on business.

•

Exploring Strategic Acquisitions.  We intend to selectively explore strategic acquisitions in the rapidly consolidating defense and microwave components industries. Strategic acquisitions could permit us to acquire complementary technologies and products, achieve higher levels of system integration, grow our existing product base, and/or increase our geographic coverage by leveraging our extensive corporate sales and marketing organization.

The Transactions

        On November 24, 2010, CPII, Predecessor and Merger Sub entered into the Merger Agreement pursuant to which CPII acquired Predecessor through the merger of Merger Sub with and into Predecessor. On February 11, 2011, contemporaneously with the consummation of the Merger, the separate corporate existence of Merger Sub ceased, and Predecessor became the surviving corporation. Predecessor's common stock is no longer publicly traded as a result of the Merger. Immediately following the consummation of the Merger and related transactions, Predecessor was converted into a limited liability company and liquidated, and we changed our name to CPI International, Inc. from CPI International Acquisition, Inc.

        In connection with the Merger, Veritas Capital invested $200.0 million, solely for the purpose of purchasing equity securities of Holding LLC in order to provide a portion of the financing required for the Merger and the transactions contemplated by the Merger Agreement. Certain officers of Predecessor also invested in equity securities of Holding LLC in an aggregate amount of $11.1 million.

        On February 11, 2011, we issued the $215 million aggregate principal amount of outstanding notes, and we entered into the senior secured credit facilities, comprised of a $150.0 million six-year term loan facility and a $30.0 million five-year revolving credit facility with UBS AG, Stamford Branch, as administrative agent, and the financial institutions party thereto (the "Senior Secured Credit Facilities"). We borrowed the full amount of the term loan thereunder in connection with the Merger, and the revolving credit facility was undrawn at closing (other than for approximately $4.5 million of outstanding letters of credit). Our obligations under the Senior Secured Credit Facilities are fully and unconditionally guaranteed by the Parent and, subject to certain exceptions, each of the Parent's existing and future domestic restricted subsidiaries (other than CPII). In addition, our obligations under the Senior Secured Credit Facilities and the guarantees of those obligations are secured by (a) pledges of all of the equity interests held by us and each guarantor and (b) liens on substantially all of our

6

assets and the assets of each guarantor, in each case subject to certain exceptions. Please see "Description of the Senior Secured Credit Facilities" for a more complete description of the Senior Secured Credit Facilities.

        In addition, in connection with the Merger, on January 13, 2011 CPI offered to purchase all $117.0 million aggregate principal amount of its existing outstanding 8% Senior Subordinated Notes due 2012 (the "8% Notes"), and Predecessor offered to purchase all $12.0 million aggregate principal amount of its existing outstanding Floating Rate Senior Notes due 2015 (the "FR Notes") pursuant to tender offers and related consent solicitations. All outstanding FR Notes and a portion of the 8% Notes were tendered pursuant to such tender offers and purchased by Predecessor and CPI, respectively, on February 11, 2011. CPI redeemed all remaining outstanding 8% Notes on March 14, 2011.

        We used the equity contributions, borrowings under the term loan facility and the net proceeds from the outstanding notes to pay the Merger consideration, consummate the tender offers and redemption, repay amounts under CPI's existing senior credit facilities and pay related fees and expenses. In this prospectus, we refer to the Merger and these related transactions as the "Transactions."

Information About Our Company

        We were incorporated in Delaware on November 24, 2010 initially under the name Catalyst Holdings, Inc., and we changed our name to CPI International Acquisition, Inc. on January 26, 2011. On February 11, 2011, immediately following the consummation of the Transactions, we changed our name to CPI International, Inc. Our principal executive offices are located at 811 Hansen Way, Palo Alto, California 94303, and our telephone number is (650) 846-2900. Our website is located at www.cpii.com. The information on, or accessible through, the website is not a part of this prospectus.

Information About Our Sponsor

        Veritas Capital is a leading private equity firm that specializes in making investments in companies that provide products and services to government-related end markets and customers around the world, including healthcare, education, energy, defense, infrastructure, national security and aerospace. Founded in 1992, Veritas has made 20 platform investments in the government services sector, including CPI International, Inc. Veritas' current portfolio companies include Aeroflex Incorporated; CRGT, Inc.; Excelitas Technologies Corp.; Global Tel*Link; KeyPoint Government Solutions, Inc.; The SI Organization, Inc.; and Vangent, Inc.

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SUMMARY DESCRIPTION OF THE EXCHANGE OFFER

On February 11, 2011, in connection with the Merger, we completed the private placement of $215,000,000 aggregate principal amount of 8.00% Senior Notes due 2018 (the "outstanding notes"). The term "exchange notes" refers to 8.00% Senior Notes due 2018 registered under the Securities Act. The term "notes" refers to both the outstanding notes and the exchange notes, unless otherwise indicated or the context so requires.

General	In connection with the private placement, we entered into a registration rights agreement with UBS Securities LLC and KKR Capital Markets LLC, the initial purchasers of the outstanding notes (the "initial purchasers"), in which we and the guarantors agreed, among other things, to use our commercially reasonable efforts to complete the exchange offer for the outstanding notes within 270 days after the date of issuance of the outstanding notes.
	You are entitled to exchange in the exchange offer your outstanding notes for exchange notes, which are identical in all material respects to the outstanding notes except:
	•       the exchange notes have been registered under the Securities Act;
	•       the exchange notes are not entitled to certain registration rights which are applicable to the outstanding notes under the registration rights agreement; and
	•       certain additional interest rate provisions are no longer applicable.
Exchange Offer	We are offering to issue up to $215 million aggregate principal amount of the exchange notes in exchange for a like principal amount of the outstanding notes to satisfy our obligations under the registration rights agreement that was executed when the outstanding notes were issued in a transaction in reliance upon the exemptions from registration provided by Rule 144A and Regulation S of the Securities Act. Outstanding notes may be tendered in minimum denominations of principal amount of $1,000 and integral multiples of $1,000. We will issue the exchange notes promptly after expiration of the exchange offer. See "The Exchange Offer—Terms of the Exchange; Period for Tendering Outstanding notes."
Expiration Date; Tenders	The exchange offer will expire at 5:00 p.m., New York City time, on                        , 2011, unless extended by us. By tendering your outstanding notes, you represent to us that:
	•       you are not our "affiliate," as defined in Rule 405 under the Securities Act;
	•       any exchange notes you receive in the exchange offer are being acquired by you in the ordinary course of your business;

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	•       neither you nor anyone receiving exchange notes from you has any arrangement or understanding with any person to participate in a distribution, as defined in the Securities Act, of the exchange notes;
	•       you are not holding outstanding notes that have, or are reasonably likely to have, the status of an unsold allotment in the initial offering;
	•       if you are a broker-dealer that will receive exchange notes for your own account in exchange for outstanding notes that were acquired by you as a result of your market-making or other trading activities, you will deliver a prospectus in connection with any resale of the exchange notes you receive. For further information regarding resales of the exchange notes by participating broker-dealers, see the discussion under the caption "Plan of Distribution."
Withdrawal; Non-Acceptance	You may withdraw any outstanding notes tendered by you in the exchange offer at any time prior to 5:00 p.m., New York City time, on                        , 2011. If we decide for any reason not to accept any outstanding notes tendered for exchange, the outstanding notes will be returned to the registered holder at our expense promptly after the expiration or termination of the exchange offer. In the case of the outstanding notes tendered by book-entry transfer into the exchange agent's account at The Depository Trust Company, any withdrawn or unaccepted outstanding notes will be credited to the tendering holder's account at DTC. For further information regarding the withdrawal of tendered outstanding notes, see "The Exchange Offer—Terms of the Exchange Offer; Period for Tendering Outstanding notes" and the "The Exchange Offer—Withdrawal Rights."
Conditions to the Exchange Offer	The exchange offer is subject to customary conditions, which we may waive. See the discussion below under the caption "The Exchange Offer—Conditions to the Exchange Offer" for more information regarding the conditions to the exchange offer.
Consequences of Not Exchanging Your Outstanding Notes	If you are eligible to participate in the exchange offer and you do not tender your outstanding notes, you will not have any further registration or exchange rights and your outstanding notes will continue to be subject to transfer restrictions. These transfer restrictions and the availability of the exchange notes may adversely affect the liquidity of your outstanding notes. See "The Exchange Offer—Consequences of Exchanging or Failing to Exchange Outstanding notes."

9

Procedures for Tendering the Outstanding Notes	You must do the following on or prior to the expiration or termination of the exchange offer to participate in the exchange offer:
	•       tender your outstanding notes by sending the certificates for your outstanding notes, in proper form for transfer, a properly completed and duly executed letter of transmittal, with any required signature guarantees, and all other documents required by the letter of transmittal, to The Bank of New York Mellon Trust Company, N.A., as exchange agent, at one of the addresses listed below under the caption "The Exchange Offer—Exchange Agent," or
	•       tender your outstanding notes by using the book-entry transfer procedures described below and transmitting a properly completed and duly executed letter of transmittal, with any required signature guarantees, or an agent's message instead of the letter of transmittal, to the exchange agent. In order for a book-entry transfer to constitute a valid tender of your outstanding notes in the exchange offer, The Bank of New York Mellon Trust Company, N.A., as exchange agent, must receive a confirmation of book-entry transfer of your outstanding notes into the exchange agent's account at DTC prior to the expiration or termination of the exchange offer. For more information regarding the use of book-entry transfer procedures, including a description of the required agent's message, see the discussion below under the caption "The Exchange Offer—Book-Entry Transfers."
Special Procedures for Beneficial Owners	If you are a beneficial owner whose outstanding notes are registered in the name of the broker, dealer, commercial bank, trust company or other nominee and you wish to tender your outstanding notes in the exchange offer, you should promptly contact the person in whose name the outstanding notes are registered and instruct that person to tender on your behalf. If you wish to tender in the exchange offer on your own behalf, prior to completing and executing the letter of transmittal and delivering your outstanding notes, you must either make appropriate arrangements to register ownership of the outstanding notes in your name or obtain a properly completed bond power from the person in whose name the outstanding notes are registered.
Certain United States Federal Income Tax Considerations	The exchange of the outstanding notes for exchange notes in the exchange offer will not be a taxable transaction for United States federal income tax purposes. See the discussion under the caption "Certain United States Federal Income Tax Considerations "for more information regarding the tax consequences to you of the exchange offer.

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Use of Proceeds	We will not receive any proceeds from the exchange offer.
Exchange Agent	The Bank of New York Mellon Trust Company, N.A. is the exchange agent for the exchange offer. You can find the address and telephone number of the exchange agent below under the caption "The Exchange Offer—Exchange Agent."
Resales	Based on interpretations by the staff of the Securities and Exchange Commission ("SEC") as set forth in no-action letters issued to the third parties, we believe that the exchange notes you receive in the exchange offer may be offered for resale, resold or otherwise transferred without compliance with the registration and prospectus delivery provisions of the Securities Act. However, you will not be able to freely transfer the exchange notes if:
	•       you are our "affiliate," as defined in Rule 405 under the Securities Act;
	•       you are not acquiring the exchange notes in the exchange offer in the ordinary course of your business;
	•       you are participating or intend to participate, or have an arrangement or understanding with any person to participate in the distribution, as defined in the Securities Act, of the exchange notes you will receive in the exchange offer; or
	•       you are holding outstanding notes that have or are reasonably likely to have the status of an unsold allotment in the initial offering.
	If you fall within one of the exceptions listed above, you cannot rely on the applicable interpretations of the staff of the SEC and you must comply with the applicable registration and prospectus delivery requirements of the Securities Act in connection with any resale transaction involving the exchange notes. See the discussion below under the caption "The Exchange Offer—Procedures for Tendering Outstanding notes" for more information.

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Broker-Dealer	Each broker-dealer that receives exchange notes for its own account pursuant to the exchange offer must acknowledge that it will deliver a prospectus in connection with any resale of such exchange notes. The letter of transmittal states that by so acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an "underwriter" within the meaning of the Securities Act. This prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of exchange notes received in exchange for outstanding notes where such outstanding notes were acquired by such broker-dealer as a result of market-making activities or other trading activities. We have agreed that, for a period of 180 days after the Expiration Date (as defined herein), we will make this prospectus available to any broker-dealer for use in connection with any such resale. See "Plan of Distribution."
	Furthermore, a broker-dealer that acquired any of its outstanding notes directly from us:
	•       may not rely on the applicable interpretations of the staff or the SEC's position contained in Exxon Capital Holdings Corp., SEC no-action letter (Apr. 13, 1988); Morgan Stanley & Co. Inc., SEC no-action letter (June 5, 1991); or Shearman & Sterling, SEC no-Action Letter (July 2, 1993); and
	•       must also be named as a selling security holder in connection with the registration and prospectus delivery requirements of the Securities Act relating to any resale transaction.

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SUMMARY DESCRIPTION OF THE EXCHANGE NOTES

The summary below describes the principal terms of the exchange notes. Certain of the terms and conditions described below are subject to important limitations and exceptions. The "Description of the Exchange Notes" section of this prospectus contains more detailed descriptions of the terms and conditions of the exchange notes.

Issuer	CPI International, Inc.
Exchange Notes Offered	We are offering up to $215,000,000 aggregate principal amount of our 8.00% Senior Notes due 2018.
Interest	The exchange notes will accrue interest from the date of their issuance at the rate of 8.00% per year. Interest on the exchange notes will be payable semi-annually in arrears on each February 15 and August 15, commencing on August 15, 2011.
Maturity Date	February 15, 2018.
Guarantees	The exchange notes will be guaranteed on a senior unsecured basis, jointly and severally, by the Parent and, subject to certain exceptions, all of the Parent's existing and future domestic restricted subsidiaries (other than the Issuer).
Ranking	The exchange notes and the guarantees will be senior unsecured obligations of ours and each of the guarantors, as applicable, and will be equal in right of payment with all of our and such guarantor's existing and future senior unsecured obligations. The exchange notes and the guarantees thereof will be senior in right of payment to any of our and each guarantor's existing and future obligations that are, by their terms, expressly subordinated in right of payment to the exchange notes and the guarantees. The exchange notes and the guarantees thereof will be effectively subordinated to our and each guarantor's existing and future secured obligations, including the Senior Secured Credit Facilities, to the extent of the value of the assets securing such obligations. As of December 31, 2010, on a pro forma basis, we and the guarantors would have had approximately $365.0 million of total debt (excluding $4.5 million in letters of credit), $150.0 million of which would have been secured, and we would have had an additional $25.5 million available to be borrowed under the revolving credit facility included in the Senior Secured Credit Facilities.
Optional Redemption	We may redeem the exchange notes, in whole or in part, at any time on or after February 15, 2015, at a redemption price equal to 100% of the principal amount thereof, plus a premium declining ratably to par and accrued and unpaid interest as set forth under "Description of the Exchange Notes—Optional redemption."

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	At any time before February 15, 2014, we may redeem up to 35% of the aggregate principal amount of the exchange notes issued under the indenture with the net cash proceeds of one or more qualified equity offerings at a redemption price equal to 108.00% of the principal amount of the exchange notes to be redeemed, plus accrued and unpaid interest.
	In addition, we may redeem some or all of the exchange notes prior to February 15, 2015 at a redemption price equal to 100% of the principal amount thereof, plus a "make-whole" premium. See "Description of the Exchange Notes—Optional redemption."
Change of Control	Upon a change of control, each holder of exchange notes may be entitled to require us to purchase all or a portion of its exchange notes at a purchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest. See "Description of the Exchange Notes—Change of control." Our ability to purchase the exchange notes upon a change of control may be limited by the terms of our debt agreements, including the Senior Secured Credit Facilities. We cannot assure you that we will have the financial resources to purchase the exchange notes in such circumstances.
Certain Covenants	The indenture governing the exchange notes will contain covenants that, among other things, will limit our ability and the ability of our restricted subsidiaries to:
	•       incur additional indebtedness;
	•       pay dividends or repurchase or redeem capital stock;
	•       limit dividends or other payments by our restricted subsidiaries to us or our other restricted subsidiaries;
	•       make certain investments;
	•       incur liens;
	•       enter into certain types of transactions with our affiliates; and
	•       sell assets or consolidate or merge with or into other companies.
	These and other covenants that will be contained in the indenture governing the exchange notes are subject to important exceptions and qualifications, which are described under "Description of the Exchange Notes."
Risk Factors	Holding the exchange notes involves a high degree of risk. You should carefully consider the risk factors set forth under the heading "Risk Factors" and the other information contained in this prospectus prior to exchanging the outstanding notes for exchange notes.

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SUMMARY HISTORICAL AND PRO FORMA FINANCIAL INFORMATION

        The following table presents our summary historical and pro forma financial information as of and for the periods presented. The summary historical financial information as of October 2, 2009 and October 1, 2010 and for the fiscal years ended 2008, 2009 and 2010 have been derived from Predecessor's audited financial statements included elsewhere in this prospectus. The summary historical financial information as of October 3, 2008 has been derived from Predecessor's audited financial statements not included in this prospectus. The summary financial information for the three months ended January 1, 2010 and December 31, 2010 and the balance sheet data as of December 31, 2010 have been derived from Predecessor's unaudited financial statements included elsewhere in this prospectus. The balance sheet data as of January 1, 2010 has been derived from Predecessor's unaudited financial statements that are not included in this prospectus. Results for the three months ended December 31, 2010 are not necessarily indicative of the results that may be expected for the year ended September 30, 2011 or for any future period. Immediately following the consummation of the Transactions, Predecessor was converted into a limited liability company and liquidated.

        The summary unaudited pro forma financial information gives effect to the Transactions as if they had occurred on October 3, 2009 and October 2, 2010 for purposes of the unaudited pro forma condensed consolidated statements of operations for the year ended October 1, 2010 and for the three months ended December 31, 2010, respectively, and on December 31, 2010 with respect to the unaudited pro forma condensed consolidated balance sheet information. We based the unaudited pro forma adjustments upon available information and certain assumptions that we believe are reasonable under the circumstances. The preliminary allocation of the purchase price to the assets acquired and the liabilities assumed is based on preliminary estimates of the fair values of the assets acquired and liabilities assumed, based on available information and certain assumptions. The final adjustments will depend on a number of factors, including the finalization of asset valuations. Therefore, the actual adjustments will differ from the pro forma adjustments, and the differences may be material.

        The unaudited pro forma financial information is for illustrative and informational purposes only and does not purport to represent or be indicative of what our financial condition or results of operations would have been had the Transactions occurred on such dates. See "The Transactions." The unaudited pro forma financial information should not be considered representative of our future financial condition or results of operations.

        Each of Parent and CPII was incorporated solely for the purpose of effectuating the Merger and related transactions. Neither Parent nor CPII conducted any other activities prior to consummation of the Merger.

        You should read this information together with the information included under the headings "Use of non-GAAP financial measures," "Risk factors," "Unaudited pro forma condensed consolidated financial information," "Selected historical consolidated financial information," "Management's discussion and analysis of financial condition and results of operations," and our historical financial statements and related notes included elsewhere in the prospectus.

15

	Historical Predecessor															Pro forma Parent
	Fiscal Year Ended October 3, 2008			Fiscal Year Ended October 2, 2009			Fiscal Year Ended October 1, 2010			Three Months Ended January 1, 2010			Three Months Ended December 31, 2010			Fiscal Year Ended October 1, 2010			Three Months Ended December 31, 2010
	(dollars in thousands)
Statement of Income Data:
Sales	$	370,014		$	332,876		$	360,434		$	82,767		$	89,020		$	360,434		$	89,020
Cost of sales		261,086			239,385			251,987			59,327			64,099			252,185			64,092
Gross profit		108,928			93,491			108,447			23,440			24,921			108,249			24,928
Research and development		10,789			10,520			12,429			2,556			3,130			12,429			3,130
Selling and marketing		21,144			19,466			20,794			5,040			5,244			20,794			5,244
General and administrative		22,951			20,757			24,988			5,525			6,316			25,688			6,491
Amortization of acquisition-related intangible assets		3,103			2,769			2,749			687			686			9,090			2,273
Strategic alternative transaction expenses(1)		—			—			19,913			—			2,657			19,913			2,657
Total operating costs and expenses		57,987			53,512			80,873			13,808			18,033			87,914			19,795
Operating income		50,941			39,979			27,574			9,632			6,888			20,335			5,133
Interest expense, net		19,055			16,979			15,213			3,881			3,711			27,097			6,770
Loss (gain) on debt extinguishment(2)		633			(248	)		—			—			—			—			—
Income tax expense (benefit)		10,804			(218	)		5,622			1,910			955			(1,454	)		(826	)
Net income (loss)(3)	$	20,449		$	23,466		$	6,739			3,841		$	2,222		$	(5,308	)	$	(811	)
Other Financial Data:
Net cash provided by operating activities	$	33,881		$	30,114		$	19,808		$	9,564		$	17,487
Net cash used in investing activities		(2,794	)		(3,365	)		(4,533	)		(811	)		(453	)
Net cash (used in) provided by financing activities		(22,891	)		(29,267	)		1,402			205			44
Capital expenditures		4,262			3,365			4,492			811			447
Depreciation and amortization(4)		10,963			10,794			11,072			2,735			2,823		$	17,611		$	4,403
EBITDA(5)		61,271			51,021			38,646			12,367			9,711			37,946			9,536
Adjusted EBITDA(6)		64,039			53,452			61,599			13,097			13,158			62,699			13,433
Adjusted EBITDA margin(7)		17.3	%		16.1	%		17.1	%		15.8	%		14.8	%		17.4	%		15.1	%
Ratio of total debt to Adjusted EBITDA(10)																	5.82
Operating Data (at period end):
Backlog	$	201,277		$	225,957		$	241,943		$	236,643		$	252,421
Balance Sheet Data (at period end):
Working capital(8)	$	88,103		$	92,380		$	44,753		$	99,700		$	50,096					$	101,181
Total assets		466,948			458,254			478,276			464,615			492,148						742,930
Long-term debt, including current portion		225,660			194,922			194,934			194,925			194,937						364,250
Total stockholders' equity(9)		143,865			173,553			183,940			179,179			187,480						185,285

(1)

Represents the termination fee and transaction expenses relating to a terminated merger agreement between CPII and Comtech Telecommunications Corp.

(2)

The redemption of $10,000 of CPII's floating rate senior notes in fiscal year 2008 resulted in a loss on debt extinguishment of approximately $633, including non-cash write-offs of $420 of unamortized debt issue costs and issue discount costs and $213 in cash payments primarily for call premiums. The repurchase of $8,000 of CPI's 8% senior subordinated notes during fiscal year 2009 resulted in a gain on debt extinguishment of $248 which was comprised of a discount of $392, partially offset by a non-cash write-off of $144 unamortized debt issue costs.

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(3)

Net income for fiscal year 2009 includes discrete tax benefits, in the aggregate, of $7,900. Net income for fiscal year 2010 includes strategic alternative transaction expenses, after taxes, of $15,200.

(4)

Depreciation and amortization excludes amortization of deferred debt issuance costs, which are included in interest expense, net.

(5)

EBITDA represents earnings before net interest expense, provision for income taxes and depreciation and amortization. We believe that EBITDA is useful to assess our ability to generate cash from operations sufficient to pay taxes, to service debt and to undertake capital expenditures. Our use of the term EBITDA may vary from others in our industry. The term EBITDA is not defined under U.S. GAAP. EBITDA is not a measure of operating income, operating performance or liquidity presented in accordance with U.S. GAAP and is subject to important limitations. For additional information regarding our use of EBITDA and limitations on its usefulness as an analytical tool, see "Use of Non-GAAP Financial Measures."

The following table reconciles net income to EBITDA:

	Historical Predecessor											Pro forma Parent
	Fiscal Year Ended October 3, 2008		Fiscal Year Ended October 2, 2009			Fiscal Year Ended October 1, 2010		Three Months Ended January 1, 2010		Three Months Ended December 31, 2010		Fiscal Year Ended October 1, 2010			Three Months Ended December 31, 2010
Net income (loss)	$	20,449	$	23,466		$	6,739	$	3,841	$	2,222	$	(5,308	)	$	(811	)
Depreciation and amortization(4)		10,963		10,794			11,072		2,735		2,823		17,611			4,403
Interest expense, net		19,055		16,979			15,213		3,881		3,711		27,097			6,770
Income tax expense (benefit)		10,804		(218	)		5,622		1,910		955		(1,454	)		(826	)
EBITDA	$	61,271	$	51,021		$	38,646	$	12,367	$	9,711	$	37,946		$	9,536

(6)

Adjusted EBITDA represents EBITDA adjusted to exclude stock compensation expense, loss (gain) on debt extinguishment, and strategic alternative transaction expenses. We believe that Adjusted EBITDA is a useful financial metric to assess our operating performance from period to period by excluding certain items that we believe are not representative of our core business. Our use of the term Adjusted EBITDA may vary from others in our industry. The term Adjusted EBITDA is not defined under U.S. GAAP. Adjusted EBITDA is not a measure of operating income, performance or liquidity presented in accordance with U.S. GAAP and is subject to important limitations. For additional information regarding our use of Adjusted EBITDA and limitations on its usefulness as an analytical tool, see "Use of Non-GAAP Financial Measures."

The following table reconciles EBITDA to Adjusted EBITDA:

	Historical Predecessor											Pro forma Parent
	Fiscal Year Ended October 3, 2008		Fiscal Year Ended October 2, 2009			Fiscal Year Ended October 1, 2010		Three Months Ended January 1, 2010		Three Months Ended December 31, 2010		Fiscal Year Ended October 1, 2010		Three Months Ended December 31, 2010
EBITDA	$	61,271	$	51,021		$	38,646	$	12,367	$	9,711	$	37,946	$	9,536
Plus adjustments:
Stock compensation expense(a)		2,135		2,679			3,040		730		790		3,040		790
Loss (gain) on debt extinguishment(b)		633		(248	)		—		—		—		—		—
Strategic alternative transaction expenses(c)		—		—			19,913		—		2,657		19,913		2,657
Sponsor advisory fee(d)		—		—			—		—		—		1,800		450
Adjusted EBITDA	$	64,039	$	53,452		$	61,599	$	13,097	$	13,158	$	62,699	$	13,433

(a)

Represents a non-cash charge for stock options, restricted stock awards, restricted stock unit awards and the employee discount related to our employee stock purchase plan.



(b)

For the fiscal year ended October 3, 2008, represents expenses related to the $10,000 redemption of FR Notes including the write-off of unamortized deferred debt issue costs, issue discount costs, redemption premiums and

17

other costs. For the fiscal year ended October 2, 2009, represents the discount related to the $8,000 repurchase of 8% Notes partially offset by the write-off of unamortized deferred debt issue costs.

(c)

Represents transaction expenses related to exploring strategic alternatives for CPII, including a $15,000 termination fee relating to the terminated merger agreement between CPII and Comtech Telecommunications Corp.



(d)

Represents the advisory fee payable pursuant to the Advisory Agreement entered into in connection with the Merger. See "Certain Relationships and Related Party Transactions—Arrangements with Veritas—Advisory Agreement."

(7)

EBITDA margin represents EBITDA divided by sales.

(8)

Current assets minus current liabilities.

(9)

Pro forma stockholders' equity represents a total equity contribution of $211,100, less $9,000 in advisory fees payable in connection with the Merger, and $16,800 of costs that was expensed immediately upon the closing of the Transactions, consisting of $12,000 of Transaction-related costs and $4,800 of costs related to the settlement of unvested stock awards.

(10)

Long-term debt, including current portion, of $365,000 divided by pro forma adjusted EBITDA.

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RISK FACTORS

You should carefully consider the risks described below and other information in this prospectus before deciding to tender your outstanding notes and participate in the exchange offer. Some of the following factors relate principally to our business and the industry in which we operate. Other factors relate principally to the exchange notes offered hereby. The risks and uncertainties described below are not intended to be exhaustive but represent the risks that we believe are material. Additional risks and uncertainties not presently known to us, or which we currently deem immaterial, may also have a material adverse effect on our business, financial condition and operating results and could therefore affect your investment in the exchange notes.

Risks Relating To Our Business

We face competition in the markets in which we sell our products.

        The U.S. and foreign markets in which we sell our products are competitive. Our ability to compete in these markets depends on our ability to provide high-quality products with short lead times at competitive prices, as well our ability to create innovative new products. In addition, our competitors could introduce new products with greater capabilities, which could have a material adverse effect on our business. Certain of our competitors are owned by companies that have substantially greater financial resources than we do. Also, our foreign competitors may not be subject to U.S. Government export restrictions, which may make it easier in certain circumstances for them to sell to foreign customers. If we are unable to compete successfully against our current or future competitors, our business and sales will be harmed.

A significant portion of our sales is, and is expected to continue to be, from contracts with the U.S. Government, and any significant reduction in the U.S. defense budget or any disruption or decline in U.S. Government expenditures could negatively affect our results of operations and cash flows.

        Approximately 34%, 33% and 35% of our sales in our 2010, 2009 and 2008 fiscal years, respectively, were made to the U.S. Government, either directly or indirectly through prime contractors or subcontractors. Because our U.S. Government contracts are dependent on the U.S. defense budget, any significant disruption or decline in U.S. Government defense expenditures in the future, changes in U.S. Government spending priorities, other legislative changes or changes in our relationship with the U.S. Government could result in the loss of some or all of our government contracts, which, in turn, could result in a decrease in our sales and cash flow.

        In addition, U.S. Government contracts are also conditioned upon continuing Congressional approval and the appropriation of necessary funds. Congress usually appropriates funds for a given program each fiscal year even though contract periods of performance may exceed one year. Consequently, at the outset of a major program, multi-year contracts are usually funded for only the first year, and additional monies are normally committed to the contract by the procuring agency only as Congress makes appropriations for future fiscal years. We cannot ensure that any of our government contracts will continue to be funded from year to year. If such contracts are not funded, our sales may decline, which could negatively affect our results of operations and result in decreased cash flows.

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We are subject to risks particular to companies supplying defense-related equipment and services to the U.S. Government. The realization of any of these risks could cause a loss of or decline in our sales to the U.S. Government.

U.S. Government contracts contain termination provisions and are subject to audit and modification.

        The U.S. Government has the ability to:

•

terminate existing contracts, including for the convenience of the government or because of a default in our performance of the contract;

•

reduce the value of existing contracts;

•

change the terms of performance of existing contracts;

•

cancel multi-year contracts or programs;

•

audit our contract-related costs and fees, including allocated indirect costs;

•

suspend or debar us from receiving new contracts pending resolution of alleged violations of procurement laws or regulations or other laws that apply to the performance of government contracts; and

•

control and potentially prohibit the export of our products, services, technology or other data.

        Each of our U.S. Government contracts can be terminated by the U.S. Government either for its convenience or if we default by failing to perform under the contract. If such contracts are terminated or reduced in scope, our sales may decline, which would negatively affect our results of operations and result in decreased cash flow. Termination-for-convenience provisions provide only for our recovery of costs incurred or committed, settlement expenses and profit on the work completed prior to termination. Termination-for-default provisions may provide for the contractor to be liable for excess costs incurred by the U.S. Government in procuring undelivered items from another source. Our contracts with foreign governments generally contain similar provisions relating to termination at the convenience of the customer.

        The U.S. Government may review or audit our direct and indirect costs and performance on certain contracts, as well as our accounting and general business practices, for compliance with complex statutes and regulations, including the Truth in Negotiations Act, Federal Acquisition Regulations, Cost Accounting Standards and other administrative regulations. The U.S. Government audits our costs and performance on a continual basis, and we have outstanding audits like most government contractors. Based on the results of these audits, the U.S. Government may reduce our contract-related costs and fees, including allocated indirect costs. In addition, under U.S. Government regulations, some of our costs, including certain financing costs, research and development costs and marketing expenses, may not be reimbursable under U.S. Government contracts.

We are subject to laws and regulations related to our U.S. Government contracts business which may impose additional costs on our business.

        As a U.S. Government contractor, we must comply with, and are affected by, laws and regulations related to our performance of our government contracts and our business. These laws and regulations may impose additional costs on our business. In addition, we are subject to audits, reviews and investigations of our compliance with these laws and regulations. In the event that we are found to have failed to comply with these laws and regulations, we may be fined, we may not be reimbursed for costs incurred in performing the contracts, our contracts may be terminated and we may be unable to obtain new contracts. If a government review, audit or investigation uncovers improper or illegal activities, we may be subject to civil or criminal penalties and administrative sanctions, including

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forfeiture of claims and profits, suspension of payments, statutory penalties, damages related to the illegal activity, fines and suspension or debarment from government contracts.

        In addition, many of our U.S. Government contracts require our employees to maintain various levels of security clearances, and we are required to maintain certain facility clearances. Complex regulations and requirements apply to obtaining and maintaining personnel and facility security clearances, and obtaining such clearances can be a lengthy process. To the extent we are not able to obtain or maintain personnel or facility security clearances, we also may not be able to seek or perform future classified contracts. If we are unable to do any of the foregoing, we will not be able to maintain or grow our business, and our revenue may decline.

As a result of our U.S. Government business, we may be subject to false claim suits, and a judgment against us in any of these suits could cause us to be liable for substantial damages.

        Our business with the U.S. Government, subjects us to "qui tam," or "whistleblower," suits brought by private plaintiffs in the name of the U.S. Government upon the allegation that we submitted a false claim to the U.S. Government, as well as to false claim suits brought by the U.S. Government. A judgment against us in a qui tam or false claim suit could cause us to be liable for substantial damages (including treble damages and monetary penalties) and could carry penalties of suspension or debarment, which would make us ineligible to receive any U.S. Government contracts for a period of up to three years. Any material judgment, or any suspension or debarment, could result in increased costs and a loss of revenue, which could negatively affect our results of operations. In addition, any of the foregoing could cause a loss of customer confidence and could negatively harm our business and our future prospects.

Some of our sole-provider business from the U.S. Government in the future may be subject to competitive bidding.

        Some of the business that we will seek from the U.S. Government in the future may be awarded through a competitive bidding process. The competitive bidding process may reduce the price at which we sell our products to the U.S. Government and reduce our net income. Competitive bidding on government contracts presents risks such as:

•

the need to bid on programs in advance of contract performance, which may result in unforeseen performance issues and costs; and

•

the expense and delay that may arise if our competitors protest or challenge the award made to us, which could result in a reprocurement, modified contract, or reduced work.

        If we fail to win competitively bid contracts or fail to perform under these contracts in a profitable manner, our sales and results of operations could suffer.

We have experienced and expect to experience fluctuations in our operating results.

        We have experienced, and in the future expect to experience, fluctuations in our operating results, including net orders and sales. The timing of customers' order placement and customers' willingness to commit to purchase products at any particular time are inherently difficult to predict or forecast. Once orders are received, factors that may affect whether these orders become sales and translate into revenues in a particular quarter include:

•

delay in shipments due to various factors, including cancellations by a customer, delays in a customer's own production schedules, natural disasters or manufacturing difficulties;

•

delay in a customer's acceptance of a product; or

•

a change in a customer's financial condition or ability to obtain financing.

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•

Our operating results may also be affected by a number of other factors, including:

•

general economic conditions in the geographical markets that we serve;

•

sensitivity to rapid technological innovation and obsolescence of existing products;

•

changes or anticipated changes in third-party reimbursement amounts or policies applicable to treatments using our products;

•

revenues becoming affected by seasonal influences;

•

changes in foreign currency exchange rates;

•

changes in the relative portion of our revenues represented by our various products;

•

timing of the announcement, introduction and delivery of new products or product enhancements by us and by our competitors;

•

disruptions in the supply or changes in the costs of raw materials, labor, product components or transportation services;

•

the impact of changing levels of sales to sole purchasers of certain of our products; and

•

the unfavorable outcome of any litigation.

Our business and operating results could be adversely affected by losses under fixed-price contracts.

        Most of our governmental and commercial contracts are fixed-price contracts. Fixed-price contracts require us to perform all work under the contract for a specified lump-sum price. Fixed-price contracts expose us to a number of risks, including underestimation of costs, ambiguities in specifications, unforeseen costs or difficulties, problems with new technologies, delays beyond our control, failure of subcontractors to perform and economic or other changes that may occur during the contract period. In addition, some of our fixed-price contracts contain termination provisions that permit our customer to terminate the contract if we are unsuccessful in fulfilling our obligations under the contract. In that event, we could be liable for the excess costs incurred by our customer in completing the contract.

The end markets in which we operate are subject to technological change, and changes in technology could adversely affect our sales.

        Our defense and commercial end markets are subject to technological change. Advances in existing technology, or the development of new technology, could adversely affect our business and results of operations. Historically, we have relied on a combination of internal research and development and customer-funded research and development activities. To succeed in the future, we must continually engage in effective and timely research and development efforts in order to introduce innovative new products for technologically sophisticated customers and end markets and to benefit from the activities of our customers. If we fail to adapt successfully to technological changes or fail to obtain access to important technologies, our sales could suffer.

We may not be successful in implementing part of our growth strategy if we are unable to identify and acquire suitable acquisition targets or integrate acquired companies successfully.

        Finding and consummating acquisitions is one of the components of our growth strategy. Our ability to grow by acquisition depends on the availability of acquisition candidates at reasonable prices and our ability to obtain additional acquisition financing on acceptable terms. In making acquisitions, we may experience competition from larger companies with significantly greater resources. We are likely to use significant amounts of cash and/or incur additional debt in connection with future acquisitions, each of which could have a material adverse effect on our business. There can be no

22

assurance that we will be able to obtain the necessary funds to carry out acquisitions on commercially reasonable terms, or at all.

        In addition, acquisitions could place demands on our management and/or our operational and financial resources and could cause or result in the following:

•

difficulties in assimilating and integrating the operations, technologies and products acquired;

•

the diversion of our management's attention from other business concerns;

•

our operating and financial systems and controls being inadequate to deal with our growth; and

•

the potential loss of key employees.

        Future acquisitions of companies may also provide us with challenges in implementing the required processes, procedures and controls in our acquired operations. Acquired companies may not have disclosure controls and procedures or internal control over financial reporting that are as thorough or effective as those required by securities laws in the United States.

Goodwill and other intangibles resulting from our acquisitions could become impaired.

        As of December 31, 2010, our pro forma goodwill, developed and core technology and other intangibles amounted to $465.4 million, net of accumulated amortization. We expect to amortize approximately $14.8 million in the first year after the Merger, $8.9 million in each of the second, third and fourth years after the Merger and $224.5 million thereafter. To the extent we do not generate sufficient cash flows to recover the net amount of any investment in goodwill and other intangibles recorded, the investment could be considered impaired and subject to a non-cash write off. We expect to record further goodwill and other intangible assets as a result of any future acquisitions. Future amortization of such other intangible assets or impairments, if any, of goodwill would adversely affect our results of operations in any given period.

Laws and regulations governing the export of our products could adversely impact our business.

        Licenses or other authorizations are required from U.S. Government agencies for the export of many of our products in accordance with various regulations, including the United States Export Administration Regulations (for commercial products, including "dual use" products with military applications) administered by the Bureau of Industry and Security ("BIS") of the U.S. Department of Commerce and the International Traffic in Arms Regulations (for defense articles and defense services) administered by the Directorate of Defense Trade Controls of the U.S. Department of State. Under these regulations, a license or other authorization may be required before transferring certain export-controlled articles or technical data, or providing defense services, to foreign persons, whether in the United States or abroad; before exporting certain of our products, services, and technical data outside the United States; before engaging in brokering activities involving export-controlled defense articles; and for the temporary import of certain defense articles and technical data. In addition, regulations administered by the Office of Foreign Assets Control ("OFAC") of the U.S. Department of the Treasury govern transactions with countries and persons subject to U.S. trade sanctions, including import as well as export transactions. We are also subject to U.S. Government restrictions on transactions with specific entities and individuals, including, without limitation, those set forth on the Entity List, the Specially Designated Nationals List, the Denied Persons List, the Unverified List, and the U.S. State Department's lists of debarred parties. We are also subject to U.S. customs laws and regulations, including customs duties, when applicable. Additionally, we are subject to the Anti-Boycott Regulations administered by the U.S. Department of Commerce, Office of Antiboycott Compliance ("OAC") and the Boycott Provisions of the Internal Revenue Code (Section 999) administered by the

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Internal Revenue Service. These laws and regulations could materially adversely impact our sales and business in the following scenarios:

•

In order to obtain the license for the sale of such a product, we are required to obtain information from the potential customer and provide it to the U.S. Government. If the U.S. Government determines that the sale presents national security risks or is otherwise contrary to U.S. policy, it may not approve the sale.

•

Delays caused by the requirement to obtain a required license or other authorization may cause delays in our production, sales and export activities, and may cause us to lose potential sales.

•

If we violate these laws and regulations, we could be subject to fines or penalties, including debarment as an exporter and/or debarment or suspension as a government contractor.

        Our internal compliance program has identified, and we have made voluntary self-disclosures regarding potential compliance issues to (i) OFAC regarding assistance provided by the Swiss branch office of one of our U.S. subsidiaries (the "Swiss Branch") with respect to sales of medical x-ray equipment by our Canadian subsidiary to distributors for resale to end-users in Iran; (ii) to OFAC and BIS regarding the repair of a U.S.-origin power supply for a customer in Syria and the re-export to Syria of a U.S.-origin part that was used in such repair, by the Netherlands branch office of one of our European subsidiaries; and (iii) OAC regarding the acceptance by the Swiss Branch of purchase orders that contained boycott language with respect to sales of power tetrodes to Saudi Arabia. Each of Iran and Syria is a country that is subject to U.S. trade sanctions. While it is not possible to predict the response of the U.S. authorities, the Company could be assessed substantial fines or other penalties as a result of these matters.

        In addition to U.S. laws and regulations, foreign countries may also have laws and regulations governing imports and exports.

We generate sales from contracts with foreign governments, and significant changes in government policies or to appropriations of those governments could have an adverse effect on our business, results of operations and financial condition.

        We estimate that approximately 13%, 15% and 12% of our sales in fiscal years 2010, 2009 and 2008, respectively, were made directly or indirectly to foreign governments. Significant changes to appropriations or national defense policies, disruptions of our relationships with foreign governments or terminations of our foreign government contracts could have an adverse effect on our business, results of operations and financial condition. Our contracts with foreign governments also subject us to U.S. and international anti-corruption laws, including the U.S. Foreign Corrupt Practices Act and the U.K. Bribery Act (which also reaches commercial bribery). A judgment or settlement under the provisions of these acts could subject us to substantial monetary penalties and damages, as well as suspension and/or debarment. Suspension or debarment could deny us the ability to retain or obtain U.S. government contracts or restrict our exporting activity. In addition, any material judgment in this area could result in increased costs, which could negatively affect our results of operations, and could cause a loss of customer confidence, thus adversely affecting our business and future prospects.

Our international operations subject us to the social, political and economic risks of doing business in foreign countries.

        We conduct a substantial portion of our business, employ a substantial number of employees and use external sales organizations in Canada and in other countries outside of the United States. As a result, we are subject to certain risks of doing business internationally. Direct sales to customers located outside the United States were approximately 36%, 37% and 36% in fiscal years 2010, 2009 and 2008,

24

respectively. Circumstances and developments related to international operations that could negatively affect our business, results of operations and financial condition include the following:

•

changes in currency rates with respect to the U.S. dollar;

•

changes in regulatory requirements;

•

potentially adverse tax consequences;

•

U.S. and foreign government policies;

•

currency restrictions, which may prevent the transfer of capital and profits to the United States;

•

restrictions imposed by the U.S. Government on the export of certain products and technology;

•

the responsibility of complying with multiple and potentially conflicting laws;

•

difficulties and costs of staffing and managing international operations;

•

the impact of regional or country specific business cycles and economic instability; and

•

geopolitical developments and conditions, including international hostilities, acts of terrorism and governmental reactions, trade relationships and military and political alliances.

        Limitations on imports, currency exchange control regulations, transfer pricing regulations and tax laws and regulations could adversely affect our international operations, including the ability of our non-U.S. subsidiaries to declare dividends or otherwise transfer cash among our subsidiaries to pay interest and principal on our debt.

We are subject to risks of currency fluctuations and related hedging operations.

        A portion of our business is conducted in currencies other than the U.S. dollar. In particular, we incur significant expenses in Canadian dollars in connection with our Canadian operations, but do not receive significant revenues in Canadian dollars. Changes in exchange rates among certain currencies, such as the Canadian dollar and the U.S. dollar, will affect our cost of sales, operating margins and revenues. Specifically, if the Canadian dollar strengthens relative to the U.S. dollar, our expenses will increase, and our results of operations will suffer. We use financial instruments, primarily Canadian dollar forward contracts, to hedge a portion of the Canadian dollar-denominated costs for our manufacturing operation in Canada. If these hedging activities are not successful or we change or reduce these hedging activities in the future, we may experience significant unexpected expenses from fluctuations in exchange rates.

Environmental and zoning laws and regulations and other obligations relating to environmental matters could subject us to liability for fines, clean-ups and other damages, require us to incur significant costs to modify our operations and/or increase our manufacturing costs.

Environmental and zoning laws and regulations could limit our ability to operate as we are currently operating and could result in additional costs.

        We are subject to a variety of U.S. federal, state and local, as well as foreign, environmental and zoning laws and regulations relating, among other things, to wastewater discharge, air emissions, storage and handling of hazardous materials, disposal of hazardous and other wastes and remediation of soil and groundwater contamination. We use a number of chemicals or similar substances and generate wastes that are classified as hazardous. We require permits to conduct many of our operations. Violations of environmental and zoning laws and regulations could result in substantial fines, penalties and other sanctions. Changes in environmental and zoning laws or regulations (or in their enforcement) affecting or limiting, for example, our chemical uses, certain of our manufacturing processes or our disposal practices, could restrict our ability to operate as we are currently operating or

25

could impose additional costs. In addition, we may experience releases of regulated materials or discover existing contamination, which could cause us to incur material cleanup costs or other damages. Some environmental laws impose strict, and in certain circumstances joint and several, liability for costs of investigation and remediation of contaminated sites on current and former owners and operators of those sites, and also impose liability for related damages to natural resources. In addition, owners and operators of contaminated sites may be subject to claims for damage to property or personal injury alleged to result from the contamination.

We could be subject to significant environmental liabilities related to our electron devices business.

        When we purchased our electron devices business in 1995, Varian Medical Systems generally agreed to indemnify us for various environmental liabilities relating to the business prior to the purchase, with certain exceptions and limitations. Varian Medical Systems is undertaking the environmental investigation and remedial work at the manufacturing facilities that are known to require environmental remediation. In addition, Varian Medical Systems has been sued or threatened with suit with respect to environmental obligations related to these manufacturing facilities. If Varian Medical Systems does not comply fully with its indemnification obligations to us or does not continue to have the financial resources to comply fully with those obligations, we could be subject to significant liabilities.

        In connection with our sale of the former Varian facility in San Carlos, California, the buyer of the facility obtained insurance to cover the expected environmental remediation costs and other potential environmental liabilities at that facility, and we released Varian Medical Systems from certain of its indemnification obligations with respect to that facility. If the proceeds of the environmental insurance are insufficient to cover the required remediation costs and potential other environmental liabilities at that facility, we could be required to bear a portion of those liabilities which would be significant.

We have only a limited ability to protect our intellectual property rights, which are important to our success.

        Our success depends, in part, upon our ability to protect our proprietary technology and other intellectual property. We rely on a combination of trade secrets, confidentiality policies, nondisclosure and other contractual arrangements and patent, copyright and trademark laws to protect our intellectual property rights. The steps we take to protect our intellectual property may not be adequate to prevent or deter infringement or other violations of our intellectual property, and we may not be able to detect unauthorized use or to take appropriate and timely steps to enforce our intellectual property rights. In addition, we cannot be certain that our processes and products do not or will not infringe or otherwise violate the intellectual property rights of others. Infringement or other violations of intellectual property rights could cause us to incur significant costs, prevent us from selling our products and have a material adverse effect on our business, results of operations and financial condition.

Our inability to obtain certain necessary raw materials and key components could disrupt the manufacture of our products and cause our sales and results of operations to suffer.

        We obtain certain raw materials and key components necessary for the manufacture of our products, such as molybdenum, cupronickel, oxygen-free high conductivity (OFHC) copper and some cathodes, from a limited group of, or occasionally sole, suppliers. If any of our suppliers fails to meet our needs, we may not have readily available alternatives. Delays in component deliveries could cause delays in product shipments and require the redesign of certain products. If we are unable to obtain necessary raw materials and key components from our suppliers under favorable purchase terms and/or on a timely basis or to develop alternative sources, our ability to manufacture products could be disrupted or delayed, and our sales and results of operations could suffer.

26

If we are unable to retain key management and other personnel, our business and results of operations could be adversely affected.

        Our business and future performance depends on the continued contributions of key management personnel. Our current management team has an average of more than 25 years experience with us (and our predecessors) in various capacities. Since assuming their current leadership roles in 2002, this team has increased our sales, reduced our costs and grown our business. The unanticipated departure of any key member of our management team could have an adverse effect on our business and our results of operations. In addition, some of our technical personnel, such as our key engineers, could be difficult to replace.

Our backlog is subject to modifications and terminations of orders, which could negatively impact our sales.

        Backlog represents firm orders for which goods and services are yet to be provided, including with respect to government contracts that are cancelable at will. As of December 31, 2010, we had an order backlog of $252.4 million. Although historically the amount of modifications and terminations of our orders has not been material compared to our total contract volume, customers can, and sometimes do, terminate or modify these orders. Cancellations of purchase orders or reductions of product quantities in existing contracts could substantially and materially reduce our backlog and, consequently, our future sales. Our failure to replace canceled or reduced backlog could negatively impact our sales and results of operations.

Changes in our effective tax rate may have an adverse effect on our results of operations.

        Our future effective tax rates may be adversely affected by a number of factors including:

•

the jurisdictions in which profits are determined to be earned and taxed;

•

the resolution of issues arising from tax audits with various tax authorities;

•

changes in the valuation of our deferred tax assets and liabilities;

•

adjustments to estimated taxes upon finalization of various tax returns;

•

increases in expenses not deductible for tax purposes;

•

changes in available tax credits;

•

changes in share-based compensation expense;

•

changes in tax laws, or the interpretation of such tax laws, and changes in generally accepted accounting principles; and/or

•

the repatriation of non-U.S. earnings for which we have not previously provided for U.S. taxes.

        Any significant increase in our future effective tax rates could adversely impact net income for future periods.

Our Sponsor controls us and may have conflicts of interest with us or you in the future.

        Veritas Capital indirectly beneficially owns substantially all of our outstanding voting shares. As a result of this ownership, our Sponsor will be entitled to elect all or substantially all of our directors, to appoint new management and to approve actions requiring the approval of our stockholder, including approving or rejecting proposed mergers or sales of all or substantially all of our assets, regardless of whether noteholders believe that any such transactions are in their own best interests.

27

        The interests of our Sponsor may differ from yours in material respects. For example, if we encounter financial difficulties or are unable to pay our debts as they mature, the interests of the equity holders might conflict with your interests as a noteholder. Our Sponsor also may have an interest in pursuing acquisitions, divestitures, financings (including financings that are secured) or other transactions that, in their judgment, could enhance their equity investments, even though such transactions might involve risks to you as a noteholder. Additionally, the indenture governing the notes will permit us to pay advisory fees, dividends or make other restricted payments under certain circumstances, and our Sponsor or their affiliates may have an interest in our doing so.

        Our Sponsor or its affiliates are in the business of making investments in companies, and own, or may from time to time in the future acquire, interests in businesses or provide advice that directly or indirectly compete with certain portions of our business or are suppliers or customers of ours. They may also pursue acquisition opportunities that may be complementary to our business and, as a result, those acquisition opportunities may not be available to us. You should consider that the interests of these holders may differ from yours in material respects. See "Security Ownership of Certain Beneficial Owners and Management," "Certain Relationships and Related Party Transactions," "Description of the Senior Secured Credit Facilities" and "Description of the Exchange Notes."

Litigation related to the Merger could adversely affect our financial results.

        A putative stockholder class action complaint was filed against Predecessor, the members of the Predecessor board of directors, and Comtech Telecommunications Corp. in the California Superior Court for the County of Santa Clara in connection with the previously proposed merger between us and Comtech Telecommunications Corp. The complaint, as amended, alleges claims against Predecessor, the members of the Predecessor board of directors, Cypress Associates II LLC, and our Sponsor and its affiliates. On January 10, 2011, Predecessor and the other defendants entered into a Memorandum of Understanding with Continuum Capital, whereby the plaintiff will dismiss its third amended complaint with prejudice in exchange for, among other agreements, an agreement by Predecessor to make certain additional disclosures concerning the currently proposed Merger, which disclosures were included in a definitive proxy statement filed by Predecessor on January 11, 2011. In addition, the Memorandum of Understanding also provides that, upon court approval and dismissal of the action, Predecessor, its insurers or its successor in interest will cause to be paid to the plaintiff's counsel $575,000 in full settlement of any claim for attorneys' fees and all expenses. CPII expects the majority of this payment to be borne by its insurers. It is possible that additional lawsuits will be filed against us and our directors in connection with the Merger. The cost of defending such lawsuits and paying any judgment or settlement in connection therewith could have an adverse impact on our financial results. See "Business—Legal Proceedings" for more information.

Risks Related To the Exchange Offer and Holding of the Notes

Our substantial leverage could adversely affect our ability to raise additional capital to fund our operations, limit our ability to react to changes in the economy or our industry, expose us to interest rate risk to the extent of our variable rate debt and prevent us from meeting our obligations under the notes.

        We are highly leveraged. On a pro forma basis as of December 31, 2010, our total indebtedness would have been approximately $365.0 million (excluding approximately $4.5 million of letters of credit), including the notes. We also would have had an additional $25.5 million available for borrowing under the new revolving credit facility included in the Senior Secured Credit Facilities.

        Our high degree of leverage could have important consequences for you, including:

•

increasing our vulnerability to adverse economic, industry or competitive developments;

28

•

requiring a substantial portion of cash flow from operations to be dedicated to the payment of principal and interest on our indebtedness, therefore reducing our ability to use our cash flow to fund our operations, capital expenditures and future business opportunities;

•

exposing us to the risk of increased interest rates because certain of our borrowings, including borrowings under our Senior Secured Credit Facilities, will be at variable rates of interest;

•

making it more difficult for us to satisfy our obligations with respect to our indebtedness, including the notes, and any failure to comply with the obligations of any of our debt instruments, including restrictive covenants and borrowing conditions, could result in an event of default under the indenture governing the notes and the agreements governing such other indebtedness;

•

restricting us from making strategic acquisitions or causing us to make non-strategic divestitures;

•

limiting our ability to obtain additional financing for working capital, capital expenditures, product development, debt service requirements, acquisitions and general corporate or other purposes; and

•

limiting our flexibility in planning for, or reacting to, changes in our business or market conditions and placing us at a competitive disadvantage compared to our competitors who are less highly leveraged and who therefore, may be able to take advantage of opportunities that our leverage prevents us from exploiting.

        Our pro forma cash interest expense for the fiscal year ended October 1, 2010 and the three months ended December 31, 2010 would have been $25.1 million and $6.3 million, respectively. At December 31, 2010, on a pro forma basis, we would have had approximately $150.0 million aggregate principal amount of variable interest rate indebtedness under our Senior Secured Credit Facilities.

Despite our high indebtedness level, we and our subsidiaries will still be able to incur significant additional amounts of debt, which could further exacerbate the risks associated with our substantial indebtedness.

        We and our subsidiaries may be able to incur substantial additional indebtedness in the future. Although the indenture governing the notes and the Senior Secured Credit Facilities contain restrictions on the incurrence of additional indebtedness, these restrictions are subject to a number of significant qualifications and exceptions, and under certain circumstances, the amount of indebtedness that could be incurred in compliance with these restrictions could be substantial. In addition to the $25.5 million which would have been available to us on a pro forma basis as of December 31, 2010 for borrowing under the new revolving credit facility included in the Senior Secured Credit Facilities, we have the option to increase the amount available under the Senior Secured Credit Facilities by up to an aggregate of $50.0 million on an uncommitted basis. If new debt is added to our and our subsidiaries' existing debt levels, the related risks that we now face would increase. In addition, the indenture governing the notes will not prevent us from incurring obligations that do not constitute indebtedness under those agreements.

We will require a significant amount of cash to service our indebtedness. Our ability to service our indebtedness depends on many factors.

        Our ability to pay principal and interest on and to refinance our debt, including the notes, depends upon the operating performance of our subsidiaries, which will be affected by, among other things, general economic, financial, competitive, legislative, regulatory and other factors, some of which are beyond our control. Based on our current level of operations, we believe our cash flow from operations, available cash and available borrowings under the Senior Secured Credit Facilities, will be adequate to meet our future liquidity needs for at least the next twelve months, barring any unforeseen

29

circumstances that are beyond our control. We cannot assure you, however, that our business will generate sufficient cash flow from operations or that future borrowings will be available to us under the Senior Secured Credit Facilities or otherwise in an amount sufficient to enable us to pay our indebtedness, including the notes, or to fund our other liquidity needs. In addition, the indenture governing the notes allows us to make significant restricted payments and other dividends. The making of such restricted payments or other dividend payments could affect our ability to pay principal and interest on our debt. We may need to refinance all or a portion of our indebtedness, including the notes, on or before the stated maturity of such indebtedness. We cannot assure you that we will be able to refinance any of our indebtedness, including the Senior Secured Credit Facilities and the notes, on commercially reasonable terms, on terms acceptable to us or at all.

The notes and the guarantees will be unsecured and effectively subordinated to our and each guarantor's existing and future secured indebtedness.

        The notes and guarantees will not be secured by any of our or the guarantors' assets. The indenture governing the notes permits us and the guarantors to incur secured debt, including pursuant to the Senior Secured Credit Facilities and other forms of secured debt. As a result, the notes and the guarantees will be effectively subordinated to all of our and each guarantor's secured obligations to the extent of the value of the assets securing such obligations.

        If we or the guarantors were to become insolvent or otherwise fail to make payment on the notes or the guarantees, holders of any of our and each guarantor's secured obligations would be paid first and would receive payments from the assets securing such obligations before the holders of the notes would receive any payments. You may therefore not be fully repaid if we or the guarantors become insolvent or otherwise fail to make payment on the notes.

Claims of noteholders will be structurally subordinated to claims of creditors of our subsidiaries that do not guarantee the notes.

        Claims of holders of the notes will be structurally subordinated to the claims of creditors of our subsidiaries that do not guarantee the notes, including trade creditors. All obligations of these subsidiaries will have to be satisfied before any of the assets of such subsidiaries would be available for distribution, upon a liquidation or otherwise, to us or creditors of us, including the holders of the notes.

        Our non-guarantor subsidiaries accounted for approximately $149.7 million, or 41.5%, of our net sales, and approximately $12.2 million, or 30.1%, of our net income, for the year ended October 1, 2010, and approximately $104.7 million, or 24.2%, of our total assets (net of cash and cash equivalents) as of October 1, 2010. Our non-guarantor subsidiaries accounted for approximately $38.4 million, or 43.1%, of our net sales, and approximately $2.1 million, or 27.1%, of our net income, for the quarter ended December 31, 2010, and approximately $103.1 million, or 24.0%, of our total assets (net of cash and cash equivalents) as of December 31, 2010. Amounts (other than net income) are presented after giving effect to intercompany eliminations.

The agreements and instruments governing our debt impose restrictions that may limit our operating and financial flexibility.

        The Senior Secured Credit Facilities and the indenture governing the notes contain a number of significant restrictions and covenants that limit our ability to:

•

incur additional indebtedness;

•

sell assets or consolidate or merge with or into other companies;

•

pay dividends or repurchase or redeem capital stock;

30

•

make certain investments;

•

issue capital stock of our subsidiaries;

•

incur liens;

•

prepay, redeem or repurchase subordinated debt; and

•

enter into certain types of transactions with our affiliates.

        These covenants could have the effect of limiting our flexibility in planning for or reacting to changes in our business and the markets in which we compete.

        In addition, the Senior Secured Credit Facilities require us to comply with financial maintenance covenants. Operating results below current levels or other adverse factors, including a significant increase in interest rates, could result in our being unable to comply with our financial covenants contained in the Senior Secured Credit Facilities. If we violate these covenants and are unable to obtain waivers from our lenders, our debt under these agreements would be in default and could be accelerated by our lenders. Because of cross-default provisions in the agreements and instruments governing our indebtedness, a default under one agreement or instrument could result in a default under, and the acceleration of, our other indebtedness. In addition, the lenders under the Senior Secured Credit Facilities could proceed against the collateral securing that indebtedness.

        If our indebtedness is accelerated, we may not be able to repay our debt or borrow sufficient funds to refinance it. Even if we are able to obtain new financing, it may not be on commercially reasonable terms, on terms that are acceptable to us or at all. If our debt is in default for any reason, our business, financial condition and results of operations could be materially and adversely affected. In addition, complying with these covenants may also cause us to take actions that are not favorable to holders of the notes and may make it more difficult for us to successfully execute our business strategy and compete against companies who are not subject to such restrictions.

The lenders under the Senior Secured Credit Facilities have the discretion to release any subsidiary guarantor under the Senior Secured Credit Facilities in a variety of circumstances, which will cause those subsidiary guarantors to be released from their guarantees of the notes.

        While any obligations under the Senior Secured Credit Facilities remain outstanding, any subsidiary guarantee of the notes may be released without action by, or consent of, any holder of the notes or the trustee under the indenture governing the notes, at the discretion of lenders under the Senior Secured Credit Facilities, if the related subsidiary guarantor is no longer a guarantor of obligations under the Senior Secured Credit Facilities or any other indebtedness. See "Description of the Exchange Notes." The lenders under the Senior Secured Credit Facilities will have the discretion to release the subsidiary guarantees under the Senior Secured Credit Facilities in a variety of circumstances. You will not have a claim as a creditor against any subsidiary that is no longer a guarantor of the notes, and the indebtedness and other liabilities, including trade payables, whether secured or unsecured, of those subsidiaries will effectively be senior to claims of noteholders.

The Parent's guarantee of the notes may not provide any additional credit support for the notes.

        Since the Parent has no significant operations or assets, its guarantee of the notes provides little, if any, additional credit support for the notes and investors should not rely on this guarantee in evaluating an investment in the notes. The indenture permits the Parent to be released from its guarantee of the notes at any time without the consent of any holder of notes.

31

Federal and state statutes may allow courts, under specific circumstances, to void the guarantees and require noteholders to return payments received from guarantors.

        Under federal bankruptcy law and comparable provisions of state fraudulent transfer laws, a guarantee could be deemed a fraudulent transfer if the guarantor received less than a reasonably equivalent value in exchange for giving the guarantee and

•

was insolvent on the date that it gave the guarantee or became insolvent as a result of giving the guarantee, or

•

was engaged in business or a transaction, or was about to engage in business or a transaction, for which property remaining with the guarantor was an unreasonably small capital, or

•

intended to incur, or believed that it would incur, debts that would be beyond the guarantor's ability to pay as those debts matured.

        A guarantee could also be deemed a fraudulent transfer if it was given with actual intent to hinder, delay or defraud any entity to which the guarantor was or became, on or after the date the guarantee was given, indebted.

        The measures of insolvency for purposes of the foregoing considerations will vary depending upon the law applied in any proceeding with respect to the foregoing. Generally, however, a guarantor would be considered insolvent if:

•

the sum of its debts, including contingent liabilities, is greater than all its assets, at a fair valuation, or

•

the present fair saleable value of its assets is less than the amount that would be required to pay its probable liability on its existing debts, including contingent liabilities, as they become absolute and mature, or

•

it could not pay its debts as they become due.

        The indenture will contain a "savings" provision intended to limit each subsidiary guarantor's liability under its guarantee to the maximum amount that it could incur without causing the guarantee to be a fraudulent transfer. This provision may not be effective to protect the subsidiary guarantees from being voided under fraudulent transfer law. There can be no assurance that this provision will be upheld as intended. In a recent case, the U.S. Bankruptcy Court in the Southern District of Florida found the "savings" provision in that case to be ineffective, and held the subsidiary guarantees to be fraudulent transfers and voided them in their entirety.

        If a guarantee is deemed to be a fraudulent transfer, it could be voided altogether, or it could be subordinated to all other debts of the guarantor. In such case, any payment by the guarantor pursuant to its guarantee could be required to be returned to the guarantor or to a fund for the benefit of the creditors of the guarantor. If a guarantee is voided or held unenforceable for any other reason, holders of the notes would cease to have a claim against the subsidiary based on the guarantee and would be creditors only of CPII and any guarantor whose guarantee was not similarly voided or otherwise held unenforceable.

We may not have the ability to raise funds necessary to finance any change of control offer required under the indenture.

        If a change of control (as defined in the indenture) occurs, we will be required to offer to purchase your notes at 101% of their principal amount plus accrued and unpaid interest. If a purchase offer obligation arises under the indenture governing the notes, a change of control could also have occurred under the new Senior Secured Credit Facilities, which could result in the acceleration of the indebtedness outstanding thereunder. Any of our future debt agreements may contain similar

32

restrictions and provisions. If a purchase offer were required under the indenture for our debt, we may not have sufficient funds to pay the purchase price of all debt, including your notes, that we are required to purchase or repay.

Our ability to repay our indebtedness, including the notes, is dependent on the cash flow generated by our operating subsidiaries.

        Our operating subsidiaries own substantially all of our assets and conduct all of our operations. Accordingly, repayment of our indebtedness, including the notes, will be dependent on the generation of cash flow by the operating subsidiaries and their ability to make such cash available to CPII, directly or indirectly, by dividend, debt repayment or otherwise. The operating subsidiaries may not be able to or may not be permitted to, make distributions to enable the CPII to make payments in respect of its indebtedness, including the notes. Each operating subsidiary is a distinct legal entity and, under certain circumstances, legal and contractual restrictions may limit the CPII's ability to obtain cash from the operating subsidiaries. While the indenture governing the notes limits the ability of the operating subsidiaries to incur consensual encumbrances or restrictions on their ability to pay dividends or make other intercompany payments, those limitations are subject to waiver and certain qualifications and exceptions.

Holders who fail to exchange their outstanding notes will continue to be subject to restrictions on transfer.

        If you do not exchange your outstanding notes for exchange notes in the exchange offer, you will continue to be subject to the restrictions on transfer of your outstanding notes described in the legend on the certificates for your outstanding notes. The restrictions on transfer of your outstanding notes arise because we issued the outstanding notes under exemptions from, or in transactions not subject to, the registration requirements of the Securities Act and applicable state securities laws. In general, you may only offer or sell the outstanding notes if they are registered under the Securities Act and applicable state securities laws, or offered and sold under an exemption from these requirements. We do not plan to register the outstanding notes under the Securities Act. In addition, if a large number of outstanding notes are exchanged for exchange notes and there is only small amount of outstanding notes outstanding, there may not be an active market in the outstanding notes, which may adversely affect the market price and liquidity of the outstanding notes. For further information regarding the consequences of tendering your outstanding notes in the exchange offer, see the discussions below under the captions "The Exchange Offer—Consequences of Exchanging or Failing to Exchange Outstanding Notes" and "Certain United States Federal Income Tax Considerations."

You must comply with the exchange offer procedures in order to receive freely tradable exchange notes.

        Delivery of exchange notes in exchange for outstanding notes tendered and accepted for exchange pursuant to the exchange offer will be made only after timely receipt by the exchange agent of the following:

•

certificates for outstanding notes or a book-entry confirmation of a book-entry transfer of outstanding notes into the exchange agent's account at DTC, New York, New York as depository;

•

a completed and signed letter of transmittal (or facsimile thereof), with any required signature guarantees, or an agent's message in lieu of the letter of transmittal; and

•

any other documents required by the letter of transmittal.

        Therefore, holders of outstanding notes who would like to tender outstanding notes in exchange for exchange notes should be sure to allow enough time for the outstanding notes to be delivered on

33

time. We are not required to notify you of defects or irregularities in tenders of outstanding notes for exchange. Outstanding notes that are not tendered or that are tendered but we do not accept for exchange will, following consummation of the exchange offer, continue to be subject to the existing transfer restrictions under the Securities Act and, upon consummation of the exchange offer, certain registration and other rights under the registration rights agreement will terminate. See "The Exchange Offer—Procedures for Tendering Outstanding Notes" and "The Exchange Offer—Consequences of Exchanging or Failing to Exchange Outstanding Notes."

An active trading market may not develop for the notes.

        The notes are a new issue of securities. There is no active public trading market for the notes. We do not intend to apply for listing of the notes on a security exchange or to include the notes in any automated quotation system. The initial purchasers of the notes have informed us that they intend to make a market in the notes. However, the initial purchasers may cease their market-making at any time. Therefore, we cannot assure you that an active trading market for the notes will develop or, if developed, that it will continue. Historically, the market for non-investment grade debt has been subject to disruptions that have caused substantial volatility in the prices of securities similar to the notes. We cannot assure you that any such disruptions may not adversely affect the prices at which you sell your notes. In addition, subsequent to their initial issuance, the notes may trade at a discount from their initial offering price, depending upon prevailing interest rates, the market for similar notes, our performance, our ability to effect the exchange offer and other factors.

34

USE OF PROCEEDS

        The exchange offer is intended to satisfy our obligations under the registration rights agreement that we entered into in connection with the private placement of the outstanding notes. We will not receive any cash proceeds from the issuance of the exchange notes in the exchange offer. As consideration for issuing the exchange notes as contemplated in this prospectus we will receive in exchange a like principal amount of outstanding notes, the terms of which are identical in all material respects to the exchange notes, except that the exchange notes will not contain terms with respect to transfer restrictions or additional interest upon a failure to fulfill certain of our obligations under the registration rights agreement. The outstanding notes that are surrendered in exchange for the exchange notes will be returned and cancelled and cannot be reissued. As a result, the issuance of the exchange notes will not result in any increase or decrease in our capitalization.

35

CAPITALIZATION

        The following table sets forth our unaudited consolidated cash and cash equivalents and our capitalization as of December 31, 2010 on an actual basis and on a pro forma basis to give effect to the Transactions as if they had occurred on that date. You should read the data set forth in the table below in conjunction with "Unaudited Pro Forma Condensed Consolidated Financial Information," "Selected Historical Consolidated Financial Information," "Management's Discussion and Analysis of Financial Condition and Results of Operations," "The Transactions," and our historical financial statements and related notes thereto included elsewhere in this prospectus.

			December 31, 2010
			Actual Predecessor		Pro forma Parent
			(dollars in millions)
Cash and cash equivalents			$	59.9	$	20.7
Debt:
	Senior Secured Credit Facilities(1)
		Revolving credit facility		—		—
		Term loan facility		—		150.0
	8.00% Senior Notes due 2018			—		215.0
	Existing debt(2)			195.0		—
Total debt				195.0		365.0
Total stockholders' equity				187.5		185.3	(3)
Total capitalization			$	382.5	$	550.3

(1)

Our Senior Secured Credit Facilities consists of a $150.0 million term loan facility and a $30.0 million revolving credit facility. We borrowed the full amount under the term loan for the Transactions and the revolving credit facility was undrawn at closing (other than for approximately $4.5 million of outstanding letters of credit). We have the option to increase the amount available under the Senior Secured Credit Facilities by up to an aggregate of $50.0 million on an uncommitted basis. See "Description of the Senior Secured Credit Facilities."

(2)

Actual amount includes $117.0 million in aggregate principal amount of the 8% Notes, $12.0 million in aggregate principal amount of the FR Notes and $66.0 million of outstanding indebtedness under CPI's existing senior credit facilities. All of the existing indebtedness was refinanced in connection with the Transactions.

(3)

Pro forma stockholders' equity represents a total equity contribution of $211.1 million, less $9 million in advisory fees payable in connection with the Merger, and $16.8 million of costs that was expensed immediately upon the closing of the Transactions, consisting of $12.0 million of Transaction-related costs and $4.8 million of costs related to the settlement of unvested stock awards.

36

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL INFORMATION

        The following unaudited pro forma condensed consolidated financial statements have been derived from our historical audited annual consolidated financial statements for the year ended October 1, 2010 and our unaudited condensed consolidated financial statements as of and for the three months ended December 31, 2010, included elsewhere in this prospectus, as adjusted to give effect to the Transactions.

        The unaudited pro forma condensed consolidated balance sheet as of December 31, 2010 gives effect to the Transactions as if they had occurred on December 31, 2010. The unaudited pro forma condensed consolidated statements of operations for the three months ended December 31, 2010 and the year ended October 1, 2010 give effect to the Transactions as if they had occurred on October 2, 2010 and October 3, 2009, respectively.

        The unaudited pro forma condensed consolidated financial statements are based on certain assumptions which we believe to be reasonable and will have a continuing impact on us. The pro forma adjustments are described in this section under the caption "Notes to Unaudited Pro Forma Condensed Consolidated Financial Statements."

        We based the unaudited pro forma adjustments upon available information and certain assumptions that we believe are reasonable under the circumstances. Assumptions underlying the pro forma adjustments are described in the accompanying notes, which should be read in conjunction with the unaudited pro forma condensed consolidated financial information. The preliminary allocation of the purchase price to the assets acquired and the liabilities assumed is based on preliminary estimates of the fair values of the assets acquired and liabilities assumed, based on available information and certain assumptions. The final adjustments will depend on a number of factors, including the finalization of asset valuations. Therefore, the actual adjustments will differ from the pro forma adjustments, and the differences may be material. The unaudited pro forma condensed consolidated financial information is presented for informational purposes only. The unaudited pro forma condensed consolidated financial information does not purport to represent what our results of operations or financial condition would have been had the Transactions actually occurred on the dates indicated, and they do not purport to project our results of operations or financial condition for any future period or as of any future date. Further, the unaudited pro forma condensed consolidated statements of operations do not reflect the impact of non-recurring charges that may result from or in connection with the Transactions, including: (i) the amortization of backlog and inventory, (ii) settlement of unvested stock awards and (iii) expenses in connection with the Transactions.

        The unaudited pro forma condensed consolidated financial information should be read in conjunction with the sections of this prospectus entitled "Capitalization," "Selected Historical Consolidated Financial Information," "Management's Discussion and Analysis of Financial Condition and Results of Operations," our historical consolidated financial statements and related notes thereto included elsewhere in this prospectus.

37

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
As of December 31, 2010
(in thousands)

			Historical Predecessor			Pro Forma Adjustments				Pro Forma Parent
Assets
Current Assets:
	Cash and cash equivalents		$	59,907		$	(39,217	)	(A)	$	20,690
	Restricted cash			3,060			—				3,060
	Accounts receivable, net			39,423			—				39,423
	Inventories			78,445			4,600		(C)		83,045
	Deferred tax assets			11,887			(3,103	)	(E)		8,784
	Prepaid and other current assets			6,112			16,347		(G,M,N,Q)		22,459
		Total current assets		198,834			(21,373	)			177,461
Property, plant, and equipment, net				52,550			27,700		(C)		80,250
Deferred debt issue costs, net				1,344			12,986		(M,N)		14,330
Intangible assets, net				71,730			194,270		(C)		266,000
Goodwill				162,225			37,199		(I)		199,424
Other long-term assets				5,465			—				5,465
		Total assets	$	492,148		$	250,782			$	742,930
Liabilities and stockholders' equity
Current Liabilities:
	Current portion of long-term debt		$	66,000		$	(64,500	)	(M,N)	$	1,500
	Accounts payable			22,195			—				22,195
	Accrued expenses			29,837			(7,958	)	(F,H,M)		21,879
	Product warranty			5,418			—				5,418
	Income taxes payable			3,522			—				3,522
	Advance payments from customers			21,766			—				21,766
		Total current liabilities		148,738			(72,458	)			76,280
Deferred income taxes				21,542			91,622		(E)		113,164
Long-term debt, less current portion				128,937			233,813		(M,N)		362,750
Other long-term liabilities				5,451			—				5,451
		Total liabilities		304,668			252,977				557,645
Commitments and contingencies
Stockholders' equity
	Common stock			171			(171	)	(J)		—
	Additional paid-in capital			81,235			(81,235	)	(J)		—
	Equity financing			—			202,100		(L)		202,100
	Accumulated other comprehensive (loss) income			(44	)		44		(J)		—
	Retained earnings			108,918			(125,733	)	(B)		(16,815	)
	Treasury stock, at cost			(2,800	)		2,800		(J)		—
		Total stockholders' equity		187,480			(2,195	)			185,285
		Total liabilities and stockholders' equity	$	492,148		$	250,782			$	742,930

See notes to unaudited pro forma condensed consolidated financial statements.

38

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
For the three months ended December 31, 2010
(in thousands)

		Historical Predecessor		Pro Forma Adjustments				Pro Forma Parent
Sales		$	89,020	$	—			$	89,020
Cost of sales			64,099		(7	)	(D)		64,092
Gross profit			24,921		7				24,928
Operating costs and expenses:
	Research and development		3,130		—				3,130
	Selling and marketing		5,244		—				5,244
	General and administrative		6,316		175		(P,Q)		6,491
	Amortization of acquisition-related intangible assets		686		1,587		(D)		2,273
	Strategic alternative transaction expenses		2,657		—				2,657
Total operating costs and expenses			18,033		1,762				19,795
Operating income			6,888		(1,755	)			5,133
Interest expense, net			3,711		3,059		(O)		6,770
Income (loss) before income taxes			3,177		(4,814	)			(1,637	)
Income tax expense (benefit)			955		(1,781	)	(R)		(826	)
Net income (loss)		$	2,222	$	(3,033	)		$	(811	)

See notes to unaudited pro forma condensed consolidated financial statements.

39

UNAUDITED PRO FORMA CONDENSED CONSOLIDATED STATEMENT OF OPERATIONS
For the year ended October 1, 2010
(in thousands)

		Historical Predecessor		Pro Forma Adjustments				Pro Forma Parent
Sales		$	360,434	$	—			$	360,434
Cost of sales			251,987		198		(D)		252,185
Gross profit			108,447		(198	)			108,249
Operating costs and expenses:
	Research and development		12,429		—				12,429
	Selling and marketing		20,794		—				20,794
	General and administrative		24,988		700		(P,Q)		25,688
	Amortization of acquisition-related intangible assets		2,749		6,341		(D)		9,090
	Strategic alternative transaction expenses		19,913		—				19,913
Total operating costs and expenses			80,873		7,041				87,914
Operating income			27,574		(7,239	)			20,335
Interest expense, net			15,213		11,884		(O)		27,097
Income (loss) before income taxes			12,361		(19,123	)			(6,762	)
Income tax expense (benefit)			5,622		(7,076	)	(R)		(1,454	)
Net income (loss)		$	6,739	$	(12,047	)		$	(5,308	)

See notes to unaudited pro forma condensed consolidated financial statements.

40

NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All amounts in thousands except shares)

1.    Basis of pro forma presentation

        The unaudited pro forma condensed consolidated balance sheet as of December 31, 2010 gives effect to the merger (the "Merger") of Catalyst Acquisition, Inc., a wholly owned subsidiary of CPI International, Inc. (formerly CPI International Acquisition, Inc., "CPII") and an indirect wholly owned subsidiary of CPI International Holding Corp. ("Parent"), with and into CPI International LLC (formerly CPI International, Inc., "Predecessor") and the related transactions described herein (collectively, the "Transactions") as if the Transactions had been completed on December 31, 2010. Immediately following the consummation of the Transactions, Predecessor was converted into a limited liability company and liquidated. The unaudited pro forma condensed consolidated statements of operations for the three months ended December 31, 2010 and the year ended October 1, 2010 give effect to the Transactions as if they had occurred on October 2, 2010 and October 3, 2009, respectively. The unaudited pro forma condensed consolidated balance sheet and unaudited pro forma condensed consolidated statements of operations were derived by adjusting Predecessor's historical financial statements for the Transactions.

        We account for business combinations in accordance with Financial Accounting Standards Board Accounting Standards Codification ("ASC") 805, "Business Combinations."

2.    Repayment of Predecessor's prior long-term debt and related interest rate swap contract

        Predecessor's consolidated long-term debt as of December 31, 2010 consisted of $117,000 of 8% senior subordinated notes due 2012 (the "8% Notes") issued by Communications & Power Industries LLC (formerly Communications & Power Industries, Inc., "CPI"), $11,937 of Predecessor's floating rate senior notes due 2015 (the "FR Notes") and $66,000 term loan under Predecessor's prior term loan. In connection with the Merger, each of Predecessor and CPI separately purchased or redeemed all of the outstanding 8% Notes and FR Notes. In addition, all amounts outstanding under the prior term loan were repaid in connection with the Merger.

        The adjustments required to be recorded in the pro forma condensed consolidated financial statements relating to the repayment of Predecessor's long-term debt are further discussed in Note 5(M). Total cash required for the repayment of principal of all prior long-term debt, transaction fees and accrued interest was $195,000, $418 and $4,231, respectively.

        In addition, in connection with the prior term loan, Predecessor had used an interest rate swap contract with an original effective date of June 2011, which was originally designated and qualified as a cash flow hedge of interest rate risk. At December 31, 2010, the fair value of the interest rate swap was a liability of $493, which is included in Predecessor's accrued expenses. The corresponding unrealized gain or loss is included in accumulated other comprehensive income. As further discussed in Note 5(F), a pro forma adjustment has been made to reflect the settlement of this interest rate swap contract in connection with the repayment of the term loan.

3.    New senior secured credit facilities and senior subordinated notes

        In connection with the Merger, CPII entered into the senior secured credit facilities consisting of (i) a $150,000 six-year term loan facility; and (ii) a $30,000 five-year revolving credit facility (the "Senior Secured Credit Facilities"). We borrowed the full amount of the term loan thereunder in connection with the Transactions, and the revolving credit facility was undrawn at closing (other than for approximately $4,500 of outstanding letters of credit). We have the option to increase the amount available under the Senior Secured Credit Facilities by up to an aggregate of $50,000 on an uncommitted basis.

41

        The revolving credit facility includes borrowing capacity available for letters of credit and for short-term borrowings referred to as the swing line borrowings. Our obligations under the Senior Secured Credit Facilities are fully and unconditionally guaranteed by Parent and, subject to certain exceptions, each of Parent's existing and future domestic restricted subsidiaries (other than CPII). In addition, our obligations under the Senior Secured Credit Facilities and the guarantees of those obligations are secured by substantially all of our assets and all of the assets of the guarantors, including but not limited to (a) pledges of all the equity interests held by us and each guarantor and (b) a first-priority security interest in, and mortgages on, substantially all of the present and after-acquired assets of us and each guarantor, in each case subject to certain exceptions.

        Borrowings under the term loan facility and the revolving credit facility bear interest, at our option, at a rate equal to a margin over either (a) a base rate or (b) LIBOR. The Senior Secured Credit Facilities are subject to amortization and prepayment requirements and contain customary representations and warranties, covenants, events of default and other provisions.

        In addition, we issued the outstanding notes. The notes are our senior unsecured obligations. Parent and, subject to certain exceptions, each of Parent's existing and future domestic restricted subsidiaries (other than CPII) guarantee the notes on a senior unsecured basis. The notes bear interest at the rate of 8.0% per year. Subject to certain exceptions, the indenture governing the notes limits our and our restricted subsidiaries' ability to incur additional indebtedness or issue certain preferred stock; pay dividends and make other restricted payments; make certain investments; sell assets; create liens; consolidate, merge or sell all or substantially of our assets; enter into transactions with affiliates and designate subsidiaries as unrestricted subsidiaries; and contains customary events of default and other provisions.

        The adjustments required to be recorded in the pro forma condensed consolidated financial statements relating to our new long-term debt are further discussed in Note 5(N).

4.    Preliminary purchase price

        Pursuant to the terms of the Merger Agreement, each outstanding share of common stock of Predecessor was converted into the right to receive $19.50 in cash in the Merger. Subject to certain exceptions, each option to purchase shares of Predecessor's common stock that was granted under its equity compensation plans and outstanding immediately prior to the closing became vested and was canceled at (or shortly following) the closing in exchange for cash equal to the excess, if any, of (i) $19.50 reduced by (ii) the per-share exercise price of such option. Subject to certain exceptions, each restricted stock award and restricted stock unit granted under Predecessor's equity compensation plans outstanding immediately prior to the closing was canceled at the closing in exchange for a payment, in cash, equal to $19.50.

        The following table presents the total preliminary purchase price based on the number of outstanding shares of common stock and stock awards of Predecessor as of December 31, 2010:

		Predecessor shares		Preliminary purchase price
Common stock			16,854,595	$	328,665
Stock awards			3,563,147		42,268
	Total			$	370,933

        The preliminary purchase price for stock awards is net of $4,759 cash paid for the unvested portion of the stock awards for which vesting was accelerated as of the closing date in accordance with the terms of the Merger Agreement. Cash payments made by the acquirer in a business combination to settle unvested stock awards are immediately expensed after the acquisition date in the post combination financial statements in accordance with ASC 805. This Merger-related cost relates directly

42

to the Transactions; however, because it was material and nonrecurring, it is not included in the unaudited pro forma condensed consolidated statements of operations presented herein. As discussed in Note 5(K), this deferred cost is included as a reduction in retained earnings in the pro forma condensed consolidated balance sheet.

        The following table reflects the preliminary allocation of the total purchase price as of December 31, 2010 to the assets acquired and the liabilities assumed and the resulting goodwill based on the preliminary estimates of fair value:

Preliminary purchase price		$	370,933
Less: Estimated fair value of assets acquired:
	Net current assets		(132,002	)
	Property, plant and equipment		(80,250	)
	Identifiable intangible assets		(266,000	)
	Other long-term assets		(6,809	)
			(485,061	)
Add: Estimated fair value of liabilities assumed:
	Deferred tax liabilities		113,164
	Long-term debt		194,937
	Other long-term liabilities		5,451
			313,552
Goodwill		$	199,424

        Goodwill represents the excess of the purchase price over the fair value of the net assets acquired.

5.    Pro forma financial statement adjustments

        The following adjustments are included in the unaudited pro forma condensed consolidated financial statements:

(A)

Represents the net change in cash, summarized in the table below, resulting from certain pro forma adjustments further described in succeeding notes.

						Reference
Sources:
	Senior secured credit facilities:
		Revolving credit facility	$	—
		Term loan facility		150,000		(N)
	Senior notes			215,000		(N)
	Veritas equity contribution, net			191,000		(L)
	Predecessor officers equity contribution			11,100		(L)
		Total sources	$	567,100
Uses:
	Purchase price			375,692		(K)
	Retirement of debt			199,649		(M)
	Debt issue costs and issue discount in debt financing			15,180		(N)
	Merger expenses			14,303		(H)
	Settlement of interest rate swap on retired term loan			493		(F)
	Advisory fee			1,000		(Q)
		Total uses		606,317
		Net change in cash	$	(39,217	)

43

(B)

Represents the net change in retained earnings, summarized in the table below, resulting from certain pro forma adjustments further described in succeeding notes.

						Reference
Historical Predecessor			$	108,918
	Elimination of historical retained earnings			(108,918	)	(J)
	Debt extinguishment costs			(418	)	(M)
	Write-off of historical debt issue costs and discount			(2,283	)	(M)
	Stock compensation relating to settlement of unvested stock awards			(4,759	)	(K)
	Merger expenses			(9,355	)	(H)
				(125,733	)
		Pro forma Parent	$	(16,815	)

(C)

Records the difference between the historical values and preliminary estimated fair values of Predecessor's intangibles, inventory, and property, plant and equipment acquired as follows:

	Predecessor Historical Values, Net		Preliminary Estimated Fair Values		Increase (Decrease)			Estimated Weighted Average Useful Life
Intangibles:
Technologies	$	49,611	$	195,000	$	145,389			30 years
Customer Backlog		—		6,000		6,000			1 year
Trade Name / Trademark		7,050		30,000		22,950			20 years
Other intangibles		5,009		—		(5,009	)
		61,670		231,000		169,330
Leasehold Interest		10,060		35,000		24,940			40 years
Total	$	71,730	$	266,000	$	194,270
Tangible property:
Inventory	$	78,445	$	83,045	$	4,600			6 months
Property, plant and equipment		52,550		80,250		27,700			10.5 years
Total	$	130,995	$	163,295	$	32,300
Net increase in tangible and intangible assets to fair value.					$	226,570

(D)

Represents the adjustment to depreciation and amortization expense as a result of the fair market value adjustments to intangibles and property, plant and equipment acquired. The estimated fair value of the assets acquired is expected to be amortized on a straight-line basis over estimated useful lives shown in Note 5(C).

The net increase in intangible amortization of $1,587 and $6,341, excluding that of leasehold interest, is reported in amortization of acquisition-related intangible assets in the unaudited pro forma condensed consolidated statements of operations for the three months ended December 31, 2010 and the year ended October 1, 2010, respectively. The net increase in leasehold interest amortization of $155 and $628 and the net decrease in property, plant and equipment depreciation of $162 and $430 are reported in cost of sales in the unaudited pro forma condensed consolidated statements of operations for the three months ended December 31, 2010 and the year ended October 1, 2010, respectively.

44

The unaudited pro forma condensed consolidated statements of operations presented herein do not include the amortization of backlog and inventory as these items are nonrecurring charges and are only included in the statement of operations during the first year after the Merger.

(E)

Records the pro forma adjustments relating to deferred taxes as summarized below. The estimated tax rate applied represents the estimated weighted average tax rates of the jurisdictions in which the respective deferred tax asset or liability is expected to be settled.

			Preliminary estimated fair value adjustment		Net (decrease) increase in deferred tax asset			Net increase in deferred tax liability
Pro forma adjustments related to:
	Increase in inventory acquired		$	4,600	$	(1,702	)	$	—
	Net increase in property, plant and equipment acquired			27,700		—			9,655
	Net increase in intangible assets			194,270		—			77,147
	Reversal of deferred tax asset on the settlement of stock options					—			4,328
	Stock compensation relating to settlement of unvested stock awards					(1,537	)		—
	Other items					136			492
		Total			$	(3,103	)	$	91,622

(F)

As discussed in Note 2, this adjustment records the cash settlement of Predecessor's interest rate swap contract of $493 in connection with the repayment of Predecessor's prior term loan. This adjustment also eliminates the liability (accrued expense) position of $493 of the swap contract in the unaudited pro forma condensed consolidated balance sheet as of December 31, 2010.

(G)

Records the short-term income tax receivable of $16,123 related to the tax benefit from exercises of stock options.

(H)

Reflects payment for Transaction-related costs, such as professional fees payable to financial and legal advisors, of $14,303, of which $3,234 was reported as a reduction in accrued expenses and $9,355 was reported as a reduction in retained earnings in the unaudited pro forma condensed consolidated balance sheet as of December 31, 2010.

The above costs relate directly to the Transactions; however, because of the material nonrecurring nature of these costs, they are not included in the unaudited pro forma condensed consolidated statements of operations presented herein.

(I)

Records the difference between the historical value and preliminary estimate of goodwill from the Merger of $37,199.

(J)

Reflects elimination of a total of $187,480 of Predecessor's historical stockholders' equity as of December 31, 2010, of which $108,918 relate to retained earnings.

(K)

Reflects cash paid for Predecessor's common stock and stock awards totaling $375,692. This amount comprised the preliminary purchase price of $370,933 and the settlement of unvested stock awards of $4,759. In accordance with ASC 805, the settlement of unvested stock awards is recorded as a reduction in retained earnings in the unaudited pro forma condensed consolidated balance sheet as of December 31, 2010 and immediately expensed after the acquisition date in the post combination financial statements. See Note 4.

(L)

In connection with the Merger, Parent received an equity contribution from the Veritas Fund, solely for the purpose of purchasing equity securities of an indirect parent of Predecessor in order

45

to provide a portion of the financing required for the Merger and the transactions contemplated by the Merger Agreement. The equity contribution amounted to $191,000, which represents an initial equity contribution of $200,000 less a $9,000 merger and acquisition fee that was payable upon Merger closing.

Certain officers of the Predecessor also invested in equity securities of the indirect parent in an aggregate amount of $11,100.

Investments from the Veritas Fund and the Predecessor's officers are reported as equity financing in the equity section of the unaudited pro forma condensed consolidated balance sheet as of December 31, 2010.

(M)

As discussed in Note 2, this adjustment reflects the repayment of Predecessor's long-term debt of $195,000, including the current portion, the payment of accrued interest payable of $4,231 and the repayment premium and other fees of $418. In addition, this adjustment also eliminates the net book value of Predecessor's deferred financing costs and issue discount of $2,283 associated with Predecessor's long-term debt in the unaudited pro forma condensed consolidated balance sheet as of December 31, 2010.

The table below summarizes the effect of the adjustments described above on the unaudited pro forma condensed consolidated balance sheet presented herein:

	Amount
Current portion of long-term debt	$	66,000
Long-term debt		129,000
Accrued interest (accrued expenses)		4,231
Debt premium (long-term debt)		418
	$	199,649

        Write-off of deferred debt issue costs and issue discount:

	Amount
Prepaid and other current assets	$	876
Deferred debt issue costs, net		1,344
Issue discount (long-term debt)		63
	$	2,283

The debt premium of $418 and debt issue costs and issue discounts of $2,283 described above were incurred after the Merger and, therefore, are reported as a reduction in retained earnings in the unaudited pro forma condensed consolidated balance sheet as of December 31, 2010.

(N)

As discussed in Note 3, this adjustment assumes that all new debt, including the $215,000 of outstanding notes and the $150,000 of term loan under the Senior Secured Credit Facilities, was incurred at the beginning of the periods presented in the unaudited pro forma condensed consolidated statements of operations. Costs, fees and issue discount associated with issuing the outstanding notes and the Senior Secured Credit Facilities were $15,180.

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The table below summarizes the effect of the adjustments described above on the unaudited pro forma condensed consolidated balance sheet presented herein:

	Amount
Current portion of long-term debt	$	1,500
Long-term debt		363,500
Prepaid and other current assets		(100	)
Deferred debt issue costs		(14,330	)
Long-term debt (issue discount)		(750	)
	$	349,820

(O)

Reflects adjustment to interest expense resulting from the elimination of Predecessor's prior long-term debt and the issuance of the outstanding notes and term loan described above, assuming the three-month LIBOR rate remains below 1.0%, as follows:

		For the Three Months Ended December 31, 2010			For the Year Ended October 1, 2010
Historical interest expense		$	(3,296	)	$	(13,866	)
Historical amortization of debt issue costs			(418	)		(1,365	)
Pro forma cash interest expense			6,275			25,072
Pro forma amortization of debt issuance costs			498			2,043
	Pro forma adjustment	$	3,059		$	11,884

The pro forma cash interest expense above reflects a blended interest rate of 6.9% for the new notes and term loan, including fees associated with letters of credit and the undrawn revolving credit facility. The pro forma amortization of debt issuance costs reflects amortization of the deferred debt issue costs described in Note 5(N) over the term of debt using the effective interest method.

(P)

Reflects certain estimated cost savings and operating synergies totaling $275 and $1,100 for the three months ended December 31, 2010 and the year ended October 1, 2010, respectively, projected to result from the Merger through elimination of redundant public company and other general and administrative expenses.

(Q)

Reflects estimated advisory fee of $450 and $1,800 for the three months ended December 31, 2010 and the year ended October 1, 2010, respectively, pursuant to the Advisory Agreement entered into in connection with the Merger. This fee is reported as general and administrative expense in the unaudited pro forma condensed consolidated statements of operations for the three months ended December 31, 2010 and the year ended October 1, 2010.

Of the total advisory fee, $1,000 was prepaid on the date of the Merger and, therefore, is reported as prepaid and other current asset in the unaudited pro forma condensed consolidated balance sheet presented herein. See "Certain relationships and related party transactions."

(R)

Records the estimated net provision for income taxes associated with the unaudited pro forma adjustments recorded in the unaudited pro forma condensed consolidated statements of operations for the three months ended December 31, 2010 and the year ended October 1, 2010. Unaudited pro forma adjustments for the periods presented were taxed at the estimated incremental rate of 37.0%.

Predecessor's effective tax rate for the three months ended December 31, 2010 was 30% and diverged from the combined federal and state statutory tax rate primarily because of Canadian foreign tax credits and a $0.2 million fiscal year 2010 discrete research and development tax benefit. Predecessor's effective tax rate for the year ended October 1, 2010 was 45.5% and diverged from the federal and state statutory rate primarily due to a $3,100 discrete tax expense on an uncertain tax position for strategic alternative transaction expenses incurred during the year.

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SELECTED HISTORICAL CONSOLIDATED FINANCIAL INFORMATION

        The following table presents Predecessor's selected historical consolidated financial information as of and for the periods presented. The selected historical financial information as of October 2, 2009 and October 1, 2010 and for the fiscal years ended 2008, 2009 and 2010 has been derived from Predecessor's audited financial statements included elsewhere in this prospectus. The selected historical financial information as of September 29, 2006, September 28, 2007 and October 3, 2008 and for the fiscal years ended 2006 and 2007 presented below has been derived from Predecessor's audited financial statements that are not included in this prospectus. The selected financial information for the three months ended January 1, 2010 and December 31, 2010 and the selected balance sheet data as of December 31, 2010 have been derived from Predecessor's unaudited financial statements included elsewhere in this prospectus. The selected balance sheet data as of January 1, 2010 has been derived from Predecessor's unaudited financial statements that are not included in this prospectus. Results for the three months ended December 31, 2010 are not necessarily indicative of the results that may be expected for the year ended October 1, 2011 or for any future period. Immediately following the consummation of the Transactions, Predecessor was converted into a limited liability company and liquidated.

        Each of Parent and CPII was incorporated solely for the purpose of effectuating the Merger and related transactions. Neither Parent nor CPII conducted any other activities prior to consummation of the Merger.

        You should read this information together with the information included under the headings "Risk Factors," "Management's Discussion and Analysis of Financial Condition and Results of Operations" and our historical consolidated financial statements and related notes included elsewhere in this prospectus.

48

	Predecessor
	Fiscal year ended															Three months ended
	September 29, 2006			September 28, 2007			October 3, 2008			October 2, 2009			October 1, 2010			January 1, 2010			December 31, 2010
	(dollars in thousands)
Statement of Income Data:
Sales	$	339,717		$	351,090		$	370,014		$	332,876		$	360,434		$	82,767		$	89,020
Cost of sales		236,063			237,789			261,086			239,385			251,987			59,327			64,099
Gross profit		103,654			113,301			108,928			93,491			108,447			23,440			24,921
Research and development		8,550			8,558			10,789			10,520			12,429			2,556			3,130
Selling and marketing		19,827			19,258			21,144			19,466			20,794			5,040			5,244
General and administrative		23,004			21,648			22,951			20,757			24,988			5,525			6,316
Amortization of acquisition-related intangible assets		2,190			2,316			3,103			2,769			2,749			687			686
Strategic alternative transaction expenses(1)		—			—			—			—			19,913			—			2,657
Total operating costs and expenses		53,571			51,780			57,987			53,512			80,873			13,808			18,033
Operating income		50,083			61,521			50,941			39,979			27,574			9,632			6,888
Interest expense, net		23,806			20,939			19,055			16,979			15,213			3,881			3,711
Loss (gain) on debt extinguishment(2)		—			6,331			633			(248	)		—			—			—
Income tax expense (benefit)		9,058			11,748			10,804			(218	)		5,622			1,910			955
Net income(3)	$	17,219		$	22,503		$	20,449		$	23,466		$	6,739		$	3,841		$	2,222
Other Financial Data:
Net cash provided by operating activities	$	10,897		$	21,659		$	33,881		$	30,114		$	19,808		$	9,564		$	17,487
Net cash used in investing activities(4)(5)		(156	)		(30,343	)		(2,794	)		(3,365	)		(4,533	)		(811	)		(453	)
Net cash (used in) provided by financing activities		(7,099	)		(995	)		(22,891	)		(29,267	)		1,402			205			44
Capital expenditures(4)		10,913			8,169			4,262			3,365			4,492			811			447
Depreciation and amortization(6)		9,013			9,098			10,963			10,794			11,072			2,735			2,823
EBITDA(7)		59,096			64,288			61,271			51,021			38,646			12,367			9,711
Adjusted EBITDA(8)		67,202			71,287			64,039			53,452			61,599			13,097			13,158
Ratio of earnings to fixed charges(9)		2.08x			2.59x			2.57x			2.30x			1.77x			2.40x			1.81x
Operating Data (at period end):
Backlog	$	187,405		$	196,363		$	201,277		$	225,957		$	241,943		$	236,643		$	252,421
Balance Sheet Data (at period end):
Working capital(10)	$	77,113		$	81,547		$	88,103		$	92,380		$	44,753		$	99,700		$	50,096
Total assets		441,759			476,222			466,948			458,254			478,276			464,615			492,148
Long-term debt, including current portion		245,067			245,567			225,660			194,922			194,934			194,925			194,937
Total stockholders' equity		99,673			125,906			143,865			173,553			183,940			179,179			187,480

(1)

Represents the termination fee and transaction expenses relating to a terminated merger agreement between CPII and Comtech Telecommunications Corp.

(2)

The debt refinancing during fiscal year 2007 resulted in a loss on debt extinguishment of approximately $6,331, including non-cash write-offs of $4,659 of unamortized debt issue costs and issue discount costs and $1,953 in cash payments for call premiums, partially offset by $281 of cash proceeds from the early termination of the related interest rate swap agreement. The redemption of $10,000 of our floating rate senior notes in fiscal year 2008 resulted in a loss on debt extinguishment of approximately $633, including non-cash write-offs of $420 of unamortized debt issue costs and issue discount costs and $213 in cash payments primarily for call premiums. The repurchase of $8,000 of our 8% Notes during fiscal year 2009 resulted in a gain on debt extinguishment of $248 which was comprised of a discount of $392, partially offset by a non-cash write-off of $144 unamortized debt issue costs.

49

(3)

Net income for fiscal year 2009 includes discrete tax benefits, in aggregate, of $7,900. Net income for fiscal year 2010 includes strategic alternative transaction expenses, after taxes, of $15,200.

(4)

Fiscal year 2006 includes capital expenditures of approximately $4,700 resulting from the relocation of our former San Carlos, California facility to Palo Alto, California and Mountain View, California. Fiscal years 2006 and 2007 include approximately $2,300 and $4,100, respectively, of capital expenditures for the expansion of our building in Georgetown, Ontario, Canada.

(5)

Fiscal year 2007 includes approximately $22,200 of cash outflow for the acquisition of Malibu Research Associates, Inc., as a result of which the Malibu Division was formed.

(6)

Depreciation and amortization excludes amortization of deferred debt issuance costs, which are included in interest expense, net.

(7)

EBITDA represents earnings before net interest expense, provision for income taxes and depreciation and amortization. We believe that EBITDA is useful to assess our ability to generate cash from operations sufficient to pay taxes, to service debt and to undertake capital expenditures. Our use of the term EBITDA may vary from others in our industry. The term EBITDA is not defined under U.S. GAAP. EBITDA is not a measure of operating income, operating performance or liquidity presented in accordance with U.S. GAAP and is subject to important limitations. For additional information regarding our use of EBITDA and limitations on its usefulness as an analytical tool, see "Use of non-GAAP financial measures."

The following table reconciles net income to EBITDA:

	Fiscal year ended											Three months ended
	September 29, 2006		September 28, 2007		October 3, 2008		October 2, 2009			October 1, 2010		January 1, 2010		December 31, 2010
Net income	$	17,219	$	22,503	$	20,449	$	23,466		$	6,739	$	3,841	$	2,222
Depreciation and amortization(6)		9,013		9,098		10,963		10,794			11,072		2,735		2,823
Interest expense, net		23,806		20,939		19,055		16,979			15,213		3,881		3,711
Income tax expense (benefit)		9,058		11,748		10,804		(218	)		5,622		1,910		955
EBITDA	$	59,096	$	64,288	$	61,271	$	51,021		$	38,646	$	12,367	$	9,711

(8)

Adjusted EBITDA represents EBITDA adjusted to exclude stock compensation expense, loss (gain) on debt extinguishment, and strategic alternative transaction expenses. We believe that Adjusted EBITDA is a useful financial metric to assess our operating performance from period to period by excluding certain items that we believe are not representative of our core business. Our use of the term Adjusted EBITDA may vary from others in our industry. The term Adjusted EBITDA is not defined under U.S. GAAP. Adjusted EBITDA is not a measure of operating income, performance or liquidity presented in accordance with U.S. GAAP and is subject to important limitations. For additional information regarding our use of Adjusted EBITDA and limitations on its usefulness as an analytical tool, see "Use of Non-GAAP Financial Measures."

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The following table reconciles EBITDA to Adjusted EBITDA:

	Fiscal year ended												Three months ended
	September 29, 2006		September 28, 2007			October 3, 2008		October 2, 2009			October 1, 2010		January 1, 2010		December 31, 2010
EBITDA	$	59,096	$	64,288		$	61,271	$	51,021		$	38,646	$	12,367	$	9,711
Plus adjustments:
Stock compensation expense(a)		274		1,239			2,135		2,679			3,040		730		790
Loss (gain) on debt extinguishment(b)		—		6,331			633		(248	)		—		—		—
Consolidation costs(c)		4,582		—			—		—			—		—		—
Special bonuses(d)		3,250		—			—		—			—		—		—
Repair inventory correction(e)		—		(571	)		—		—			—		—		—
Strategic alternative transaction expenses(f)		—		—			—		—			19,913		—		2,657
Adjusted EBITDA	$	67,202	$	71,287		$	64,039	$	53,452		$	61,599	$	13,097	$	13,158

(a)

Represents a non-cash charge for stock options, restricted stock awards, restricted stock unit awards and the employee discount related to our employee stock purchase plan.



(b)

For the fiscal year ended September 28, 2007, represents expenses related to the $58,000 redemption of FR Notes including the write-off of unamortized deferred debt issue costs, redemption premiums and other costs, partially offset by cash proceeds from the early termination of an interest rate swap on the FR Notes. For the fiscal year ended October 3, 2008, represents expenses related to the $10,000 redemption of FR Notes including the write-off of unamortized deferred debt issue costs, issue discount costs, redemption premiums and other costs. For the fiscal year ended October 2, 2009, represents the discount related to the $8,000 repurchase of 8% Notes partially offset by the write-off of unamortized deferred debt issue costs.



(c)

Represents direct costs related to the relocation of the power grid product line from our former San Carlos, California facility to our Palo Alto, California and Mountain View, California facilities.



(d)

Represents a one-time special bonus to employees and directors (other than directors who were employees or affiliates of The Cypress Group) to reward them for the increase in company value.



(e)

Represents a one-time, non-cash reduction to cost of sales to correct inventory that was expensed in prior periods.



(f)

Represents transaction expenses related to exploring strategic alternatives for CPII, including a $15,000 termination fee relating to the terminated merger agreement between CPII and Comtech Telecommunications Corp.

(9)

For purposes of computing the ratio of earnings to fixed charges, earnings consist of income from continuing operations before income taxes and fixed charges less capitalized interest. Fixed charges consist of interest expense, including amortization of debt issuance costs and that portion of rental expenses that management considers to be a reasonable approximation of interest.

(10)

Current assets minus current liabilities.

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MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION
AND RESULTS OF OPERATIONS

The following discussion and analysis of the results of operations and financial condition of Predecessor covers periods prior to the consummation of the Transactions. Accordingly, the following discussion and analysis of historical periods does not reflect the significant impact that the Transactions will have on us, including significantly increased leverage. This discussion contains forward-looking statements and involves numerous risks and uncertainties, including, but not limited to, those described in the "Risk Factors" section of this prospectus. Actual results may differ materially from those contained in any forward-looking statements.

Each of Parent and CPII was incorporated solely for the purpose of effectuating the Merger and related transactions. Neither Parent nor CPII conducted any other activities prior to consummation of the Merger.

Our fiscal years are the 52- or 53-week periods that end on the Friday nearest September 30. Fiscal years 2010 and 2009 comprised the 52-week period ending October 1, 2010 and October 2, 2009, respectively. Fiscal year 2008 comprised the 53-week period ended October 3, 2008. The first quarters of both fiscal years 2011 and 2010 include 13 weeks.

You should read the following discussion of our results of operations and financial condition together with "Unaudited Pro Forma Condensed Consolidated Financial Information," "Selected Historical Consolidated Financial Information," the audited financial statements and the unaudited financial statements included elsewhere in this prospectus.

Overview

        CPI International, Inc. or CPII, headquartered in Palo Alto, California, is the parent company of Communications & Power Industries LLC, or CPI, a provider of microwave, radio frequency, power and control solutions for critical defense, communications, medical, scientific and other applications. CPI develops, manufactures and distributes products used to generate, amplify, transmit and receive high-power/high-frequency microwave and radio frequency signals and/or provide power and control for various applications. End-use applications of these systems include the transmission of radar signals for navigation and location; transmission of deception signals for electronic countermeasures; transmission and amplification of voice, data and video signals for broadcasting, Internet and other types of commercial and military communications; providing power and control for medical diagnostic imaging; and generating microwave energy for radiation therapy in the treatment of cancer and for various industrial and scientific applications.

The Merger And Related Transactions

        On November 24, 2010, CPII, Predecessor and Merger Sub entered into the Merger Agreement pursuant to which CPII acquired Predecessor through the Merger of Merger Sub with and into Predecessor. On February 11, 2011, contemporaneously with the consummation of the Merger, the separate corporate existence of Merger Sub ceased, and Predecessor became the surviving corporation. Predecessor's common stock is no longer publicly traded as a result of the Merger. Immediately following the consummation of the Merger and related transactions, Predecessor was converted into a limited liability company and liquidated, and we changed our name to CPI International, Inc. from CPI International Acquisition, Inc.

        In connection with the Merger, Veritas Capital invested $200.0 million solely for the purpose of purchasing equity securities of Holding LLC in order to provide a portion of the financing required for the Merger and the transactions contemplated by the Merger Agreement. Certain officers of Predecessor also invested in equity securities of Holdings LLC in an aggregate amount of $11.1 million. In addition, we issued the outstanding notes and entered into the Senior Secured Credit Facilities to

52

finance a portion of the Merger and related transactions. See "The Transactions," and "Unaudited Pro Forma Condensed Consolidated Financial Information."

        As a result of the Transactions, our assets and liabilities were adjusted to their fair market value at the closing date of the Transactions. We have made a preliminary allocation of the purchase price in the accompanying condensed consolidated pro forma financial statements. This preliminary allocation will be subject to change upon finalization of our fair value assessment and any adjustments could be material. After giving effect to the Transactions, our outstanding indebtedness and our annual interest expense will increase substantially. In addition, in connection with the Transactions, we will record a number of one-time charges relating to the Transactions, including the amortization of backlog and fair value adjustment of inventory, the settlement of unvested stock awards and certain Transaction-related costs. See "Unaudited Pro Forma Condensed Consolidated Financial Information—Notes to Unaudited Pro Forma Condensed Consolidated Financial Statements—Notes 5(D), 5(H) and 5(K)" for further information regarding these one-time charges.

Orders

        We sell our products into five end markets: defense (radar and electronic warfare), medical, communications, industrial and scientific.

        Our customer sales contracts are recorded as orders when we accept written customer purchase orders or contracts. Customer purchase orders with an undefined delivery schedule, or blanket purchase orders, are not reported as orders until the delivery date is determined. Our government sales contracts are not reported as orders until we have been notified that the contract has been funded. Total orders for a fiscal period represent the total dollar amount of customer orders recorded by us during the fiscal period, reduced by the dollar amount of any order cancellations or terminations during the fiscal period.

        Incoming order levels can fluctuate significantly on a quarterly or annual basis, and a particular quarter's or year's order rate may not be indicative of future order levels. In addition, our sales are highly dependent upon manufacturing scheduling and performance and, accordingly, it is difficult to accurately predict when orders will be recognized as sales.

First Quarter of Fiscal Year 2011 and First Quarter of Fiscal Year 2010

        Our orders by market for the first quarter of fiscal years 2011 and 2010 are summarized as follows (dollars in millions):

		December 31, 2010					January 1, 2010					Increase (Decrease)
		Amount		% of Orders			Amount		% of Orders			Amount			% of Orders
Radar and Electronic Warfare		$	45.3		46	%	$	33.5		36	%	$	11.8			35	%
Medical			13.6		14			15.6		17			(2.0	)		(13	)%
Communications			30.0		30			35.1		38			(5.1	)		(15	)
Industrial			5.5		5			3.8		4			1.7			45
Scientific			4.47		5			4.7		5			—			0
	Total	$	99.1		100	%	$	92.7		100	%	$	6.4			7	%

        Orders of $99.1 million for the first quarter of fiscal year 2011 were $6.4 million, or approximately 7%, higher than orders of $92.7 million for the first quarter of fiscal year 2010. Explanations for the

53

order increase or decrease by market for the first quarter of fiscal year 2011 compared to the first quarter of fiscal year 2010 are as follows:

•

Radar and Electronic Warfare:  The majority of our products in the radar and electronic warfare markets are for domestic and international defense and government end uses. Orders in these markets are primarily comprised of many orders of less than $3.0 million by product or program, and the timing of these orders may vary from year to year. On a combined basis, orders for the radar and electronic warfare markets increased approximately 35% from an aggregate of $33.5 million in the first quarter of fiscal year 2010 to an aggregate of $45.3 million in the first quarter of fiscal year 2011. The increase in orders for these combined markets resulted primarily from an increase in demand for products to support a counter-improvised explosive device ("counter-IED") program and the Aegis weapons system. These increases were partially offset by decreases in orders to support various weather radar programs due to the timing of those programs.

•

Medical:  Orders for our medical products consist of orders for medical imaging applications, such as x-ray imaging, magnetic resonance imaging ("MRI") and positron emission tomography ("PET") applications, and for radiation therapy applications for the treatment of cancer. The 13% decrease in medical orders resulted primarily from a decrease in demand for products to support MRI applications, largely due to the typically irregular timing and size of orders to support those applications. Demand for products to support x-ray imaging applications also decreased due to the receipt of a large order in the first quarter of fiscal year 2010 that did not repeat in the first quarter of fiscal year 2011. These decreases were partially offset by an increase in orders to support radiation therapy applications.

•

Communications:  Orders for our communications products consist of orders for commercial communications applications and military communications applications. The 15% decrease in communications orders was due, in part, to a decrease in orders for military communications applications and other communications applications as a result of the timing of various programs. Over the long term, we expect our participation in military communications programs to continue to grow. These decreases were partially offset by an increase in demand for products to support satellite broadcast applications for commercial communications.

•

Industrial:  Orders in the industrial market are cyclical and are generally tied to the state of the economy. The $1.7 million increase in industrial orders was due to the receipt of a development order for a nuclear magnetic resonance program, an increase in demand for products used in instrumentation applications due to program timing and an overall increase in demand for products to support various other industrial activities.

•

Scientific:  Orders in the scientific market are historically one-time projects and can fluctuate significantly from period to period. However, in the first quarter of fiscal year 2011, the orders level in the scientific market was essentially unchanged in comparison to the first quarter of fiscal year 2010.

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Comparison of Orders for the Years Ended October 1, 2010 and October 2, 2009

        Our orders by market for fiscal years 2010 and 2009 are summarized as follows (dollars in millions):

	Fiscal year ended
	October 1, 2010					October 2, 2009
											(Decrease) increase
			% of orders					% of orders
	Amount					Amount					Amount			Percent
Radar and Electronic Warfare	$	129.7		34	%	$	142.2		40	%	$	(12.5	)		(9	)%
Medical		70.1		19			66.9		19			3.2			5
Communications		131.0		35			119.2		33			11.8			10
Industrial		26.1		7			21.2		6			4.9			23
Scientific		18.0		5			6.5		2			11.5			177
Total	$	374.9		100	%	$	356.0		100	%	$	18.9			5	%

        Orders of $374.9 million for fiscal year 2010 were $18.9 million, or 5%, higher than orders of $356.0 million for fiscal year 2009. Explanations for the order increase or decrease by market for fiscal year 2010 compared to fiscal year 2009 are as follows:

•

Radar and Electronic Warfare:  The majority of our products in the radar and electronic warfare markets are for domestic and international defense and government end uses. Orders in these markets are characterized by many smaller orders (under $3.0 million) by product or program, and the timing of these orders may vary from year to year. On a combined basis, orders for the radar and electronic warfare markets decreased approximately 9% from $142.2 million in fiscal year 2009 to $129.7 million in fiscal year 2010. In fiscal year 2010, the decrease in orders for these combined markets was primarily due to the timing of orders to support certain radar and electronic warfare systems, including a foreign radar program, several airborne electronic countermeasure systems and the HAWK missile system. In fiscal year 2009, we received a $4.1 million order for a foreign radar program; this large order was not expected to, and did not, repeat in fiscal year 2010.

•

Medical:  Orders for our medical products consist of orders for medical imaging applications, such as x-ray imaging, MRI and PET applications, and for radiation therapy applications for the treatment of cancer. The 5% increase in medical orders was due primarily to an increase in demand for products to support x-ray imaging and MRI applications.

•

Communications:  Orders for our communications products consist of orders for commercial communications applications and military communications applications. The 10% increase in communications orders was primarily due to increases in orders to support commercial communications applications, such as fixed satellite broadcast and terrestrial broadcast applications.

Excluding the Warfighter Information Network—Tactical ("WIN-T") program, demand for products to support military communications programs also increased during fiscal year 2010. Military communications is a relatively new sector of the overall communications market for us, and over the long term, we expect our participation in military communications programs to continue to grow. With the exception of the WIN-T program, military communications is characterized by numerous programs that are relatively modest in size and for which the timing may vary from year to year. Because of the atypically large size and frequency of the orders we received to support the WIN-T program in fiscal year 2009, orders for this program decreased approximately $21 million in fiscal year 2010. As expected, the size and frequency of those large WIN-T orders were not repeated in fiscal year 2010.

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•

Industrial:  Orders in the industrial market are cyclical and are generally tied to the state of the economy. The $4.9 million increase in industrial orders was primarily due to an increase in demand for products used in semiconductor and liquid crystal display ("LCD") screen manufacturing applications, new advanced nuclear magnetic resonance applications and industrial heating applications.

•

Scientific:  Orders in the scientific market are historically one-time projects and can fluctuate significantly from period to period. The $11.5 million increase in scientific orders was primarily the result of the receipt of orders for products to support fusion research and other "Big Science" programs at domestic and European laboratories.

Backlog

        As of December 31, 2010, we had an order backlog of $252.4 million compared to an order backlog of $236.6 million as of January 1, 2010. We had an order backlog of $241.9 million as of October 1, 2010 compared to an order backlog of $226.0 million as of October 2, 2009. Because our orders for government end-use products generally have much longer delivery terms than our orders for commercial business (which require quicker turn-around), our backlog is primarily composed of government end-use orders.

        Backlog represents the cumulative balance, at a given point in time, of recorded customer sales orders that have not yet been shipped or recognized as sales. Backlog is increased when an order is received, and backlog is decreased when we recognize sales. We believe that backlog and orders information is helpful to investors because this information may be indicative of future sales results. Although backlog consists of firm orders for which goods and services are yet to be provided, customers can, and sometimes do, terminate or modify these orders. However, historically the amount of modifications and terminations has not been material compared to total contract volume.

Results Of Operations

        We derive our revenue primarily from the sale of microwave and radio frequency products, including high-power microwave amplifiers, satellite communications amplifiers, medical x-ray imaging subsystems and other related products. Our products generally have selling prices ranging from $2,000 to $200,000, with certain limited products priced up to $1,000,000.

        Cost of goods sold generally includes costs for raw materials, manufacturing costs, including allocation of overhead and other indirect costs, charges for reserves for excess and obsolete inventory, warranty claims and losses on fixed price contracts. Operating expenses generally consist of research and development, selling and marketing and general and administrative expenses.

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        The following table sets forth our historical results of operations for each of the periods indicated (dollars in millions):

		Quarter Ended
															Fiscal Year Ended
												Increase (Decrease)
		December 31, 2010					January 1, 2010								October 1, 2010					October 2, 2009						October 3, 2008
		Amount		% of sales			Amount		% of sales			Amount			Amount		% of sales			Amount			% of sales			Amount		% of sales
Sales		$	89.0		100.0	%	$	82.8		100.0	%	$	6.2		$	360.4		100.0	%	$	332.9			100.0	%	$	370.0		100.0	%
Cost of sales			64.1		72.0			59.3		71.6			4.8			252.0		69.9			239.4			71.9			261.1		70.6
	Gross profit	$	24.9		28.0	%	$	23.4		28.3	%	$	1.5		$	108.4		30.1	%	$	93.5			28.1	%	$	108.9		29.4	%
Research and development			3.1		3.5			2.6		3.1			0.5			12.4		3.4			10.5			3.2			10.8		2.9
Selling and marketing			5.2		5.8			5.0		6.0			0.2			20.8		5.8			19.5			5.9			21.1		5.7
General and administrative			6.3		7.1			5.5		6.6			0.8			25.0		6.9			20.8			6.2			22.9		6.2
Amortization of acquisition related intangibles			0.7		0.8			0.7		0.8			—			2.7		0.7			2.8			0.8			3.1		0.8
Strategic alternative transaction expenses			2.7		3.0			—		—			2.7			19.9		5.5			—			—			—		—
Operating income		$	6.9		7.8	%	$	9.6		11.6	%	$	(2.7	)	$	27.6		7.7	%	$	40.0			12.0	%	$	50.9		13.8	%
Interest expense, net			3.7		4.2			3.9		4.7			(0.2	)		15.2		4.2			17.0			5.1			19.1		5.2
(Gain) loss on debt extinguishment			—		—			—		—			—			—		—			(0.2	)		(0.1	)		0.6		0.2
	Income before taxes	$	3.2		3.6	%	$	5.8		4.7	%	$	(2.6	)	$	12.4		3.4	%	$	23.2			7.0	%	$	31.3		8.5	%
Income tax expense (benefit)			1.0		1.1			1.9		(0.1	)		(0.9	)		5.6		1.6			(0.2	)		(0.1	)		10.8		2.9
	Net income	$	2.2		2.5	%	$	3.8		4.6	%	$	(1.6	)		6.7		1.9	%	$	23.5			7.1	%	$	20.4		5.5	%
Other Data:
	EBITDA(a)	$	9.7		10.9	%	$	12.4		15.0	%	$	(2.7	)	$	38.6		10.7	%	$	51.0			15.3	%	$	61.3		16.6	%

Note: Totals may not equal the sum of the components due to independent rounding. Percentages are calculated based on rounded dollar amounts presented.

(a)

EBITDA represents earnings before net interest expense, provision for income taxes and depreciation and amortization. For the reasons listed below, we believe that U.S. generally accepted accounting principles ("GAAP") based financial information for leveraged businesses such as ours should be supplemented by EBITDA so that investors better understand our financial performance in connection with their analysis of our business:

•

EBITDA is a component of the measures used by our board of directors and management team to evaluate our operating performance;

•

our senior credit facilities contain a covenant that requires us to maintain a senior secured leverage ratio that contains EBITDA as a component, and our management team uses EBITDA to monitor compliance with this covenant;

•

EBITDA is a component of the measures used by our management team to make day-to-day operating decisions;

•

EBITDA facilitates comparisons between our operating results and those of competitors with different capital structures and, therefore, is a component of the measures used by the management to facilitate internal comparisons to competitors' results and our industry in general; and

•

the payment of management bonuses is contingent upon, among other things, the satisfaction by us of certain targets that contain EBITDA as a component.

Other companies may define EBITDA differently and, as a result, our measure of EBITDA may not be directly comparable to EBITDA of other companies. Although we use EBITDA as a financial measure to assess the performance of our business, the use of EBITDA is limited because it does not include certain material costs, such as interest and taxes, necessary to operate our business. When analyzing our performance, EBITDA should be considered in addition to, and not as a substitute for or superior to, net income, cash flows from operating activities or other statements of income or statements of cash flows data prepared in accordance with GAAP.

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For a reconciliation of Net Income to EBITDA, see Note 12 of the accompanying unaudited condensed consolidated financial statements.

Our results for three months ended December 31, 2010 compared to three months ended January 1, 2010

        Sales:    Our sales by market for the first quarter of fiscal years 2011 and 2010 are summarized as follows (dollars in millions):

	Quarter Ended
	December 31, 2010					January 1, 2010					Increase (decrease)
	Amount		% of sales			Amount		% of sales			Amount			% of sales
Radar and Electronic Warfare	$	31.7		36	%	$	28.2		34	%	$	3.5			12	%
Medical		17.0		19			19.4		23			(2.4	)		(12	)
Communications		30.6		34			28.7		35			1.9			7
Industrial		5.4		6			5.2		6			0.2			4
Scientific		4.3		5			1.3		2			3.0			231
Total	$	89.0		100	%	$	82.8		100	%	$	6.2			7	%

        Sales of $89.0 million for the first quarter of fiscal year 2011 were $6.2 million, or approximately 7%, higher than sales of $82.8 million for the first quarter of fiscal year 2010. Explanations for the sales increase or decrease by market for the first quarter of fiscal year 2011 as compared to the first quarter of fiscal year 2010 are as follows:

•

Radar and Electronic Warfare:  The majority of our products in the radar and electronic warfare markets are for domestic and international defense and government end uses. The timing of orders receipts and subsequent shipments in these markets may vary from year to year. On a combined basis, sales for these two markets increased 12% from an aggregate of $28.2 million in the first quarter of fiscal year 2010 to an aggregate of $31.7 million in the first quarter of fiscal year 2011. This increase was due to an increase in demand for products to support the Aegis weapons system, several electronic warfare systems and a counter-IED program.

•

Medical:  Sales of our medical products consist of sales for medical imaging applications, such as x-ray imaging, MRI and PET applications, and for radiation therapy applications for the treatment of cancer. The 12% decrease in sales of our medical products in the first quarter of fiscal year 2011 was primarily due to a decrease in sales of products to support MRI applications, largely because of the typically irregular timing and size of orders to support those applications. Sales of products to support x-ray imaging applications also decreased, primarily as a result of the timing of various x-ray imaging programs.

•

Communications:  Sales of our communications products consist of sales for commercial communications applications and military communications applications. The 7% increase in sales in the communications market was primarily due to increases in sales of products to support military communications applications, particularly tactical common data link ("TCDL") products for intelligence, surveillance and reconnaissance ("ISR") applications. Over the long term, we expect our participation in military communications programs to continue to grow. In commercial communications, sales of products to support satellite broadband applications increased while sales of products to support other direct-to-home broadcast applications decreased.

•

Industrial:  Sales in the industrial market are cyclical and are generally tied to the state of the economy. The $0.2 million increase in sales of industrial products in the first quarter of fiscal

58

year 2011 was primarily due to increases in sales to support semiconductor wafer fabrication applications.

•

Scientific:  Sales in the scientific market are historically one-time projects and can fluctuate significantly from period to period. The $3.0 million increase in scientific sales was primarily the result of increased sales for a fusion research program and various other scientific development programs.

        Gross Profit.    Gross profit was $24.9 million, or 28.0% of sales, for the first quarter of fiscal year 2011 as compared to $23.4 million, or 28.3% of sales, for the first quarter of fiscal year 2010. The $1.5 million increase in gross profit for the first quarter of fiscal year 2011 as compared to the first quarter of fiscal year 2010 was primarily due to higher shipment volume in the first quarter of fiscal year 2011.

        Research and Development.    Research and development expenses were $3.1 million, or 3.5% of sales, for the first quarter of fiscal year 2011, a $0.5 million increase from $2.6 million, or 3.1% of sales, for the first quarter of fiscal year 2010. The increase in research and development for the first quarter of fiscal year 2011 compared to the first quarter of fiscal year 2010 was primarily due to increased investment for the development of communication amplifiers for commercial and military applications and the solid state and vacuum electron devices used in these amplifiers, and development of vacuum electron devices for the scientific and medical markets.

        Total spending on research and development, including customer-sponsored research and development, was as follows (in millions):

	Quarter Ended
	December 31, 2010		January 1, 2010
Company sponsored	$	3.1	$	2.6
Customer sponsored, charged to cost of sales		3.7		3.7
	$	6.8	$	6.3

        Selling and Marketing.    Selling and marketing expenses were $5.2 million, or 5.8% of sales, for the first quarter of fiscal year 2011, and $5.0 million, or 6.0% of sales, for the first quarter of fiscal year 2010. There was no significant change in selling and marketing expenses for the first fiscal quarters of 2010 and 2011.

        General and Administrative.    General and administrative expenses were $6.3 million, or 7.1% of sales, for the first quarter of fiscal year 2011, a $0.8 million increase from the $5.5 million, or 6.6% of sales, for the first quarter of fiscal year 2010. The increase in general and administrative expenses in the first quarter of fiscal year 2011 was primarily due to a $0.5 million loss contingency expense accrual for a customer contract termination and $0.2 million for the unfavorable impact from foreign currency translation.

        Amortization of Acquisition-Related Intangibles.    Amortization of acquisition-related intangibles consists of purchase accounting charges for technology and other intangible assets. Amortization of acquisition-related intangibles was $0.7 million for the first quarter of fiscal years 2011 and 2010.

        Strategic Alternative expense.    Merger expenses of $2.7 million for the first quarter of fiscal year 2011 comprised non-recurring transaction costs, such as fees for investment bankers, attorneys and other professional services, rendered in connection with the pending sale of the company.

        Interest Expense, net ("Interest Expense").    Interest Expense was $3.7 million, or 4.2% of sales, for the first quarter of fiscal year 2011, a $0.2 million decrease from the $3.9 million, or 4.7% of sales,

59

for the first quarter of fiscal year 2010. The reduction in interest expense for the first quarter of fiscal year 2011 was primarily due to lower interest rates on our variable rate debt agreements over the past year, as debt levels remained unchanged.

        Income Tax Expense (Benefit).    We recorded an income tax expense of $1.0 million for the first quarter of fiscal year 2011 and an income tax expense of $1.9 million for the first quarter of fiscal year 2010. The effective income tax rate for the first quarter of fiscal years 2011 and 2010 was 30% and 33%, respectively. The lower effective income tax rate in fiscal year 2011 is primarily due to higher U.S. research and development tax credits, an increase in the U.S. domestic manufacturing deduction and an increase in Canadian foreign tax credits. As a result of the enactment of the Tax Relief, Unemployment Insurance Reauthorization, and Job Creation Act of 2010, effective December 17, 2010, the first quarter of fiscal year 2011 includes a $0.2 million discrete tax benefit due to the retroactive reinstatement of the research and development tax credit to calendar year 2010.

        Net Income.    Net income was $2.2 million, or 2.5% of sales, for the first quarter of fiscal year 2011 as compared to $3.8 million, or 4.6% of sales, in the first quarter of fiscal year 2010. The $1.6 million decrease in net income in the first quarter of fiscal year 2011 as compared to the first quarter of fiscal year 2010 was primarily due to $2.7 million of strategic alternative expenses in the first quarter of fiscal year 2011, net of income tax benefits of $1.1 million. The $6.2 million increase in shipment volume and $1.5 million increase in gross profit during the first quarter of fiscal year 2011 was partially offset by higher spending on research and development and the loss contingency accrual for a fiscal year 2009 terminated sales contract.

        EBITDA.    EBITDA was $9.7 million, or 10.9% of sales, for the first quarter of fiscal year 2011 as compared to $12.4 million, or 15.0% of sales, for the first quarter of fiscal year 2010. The $2.7 million decrease in EBITDA in the first quarter of fiscal year 2011 as compared to the first quarter of fiscal year 2010 was due primarily to $2.7 million of strategic alternative expenses in the first quarter of fiscal year 2011. The $6.2 million increase in shipment volume and $1.5 million increase in gross profit during the first quarter of fiscal year 2011 was partially offset by higher spending on research and development and the loss contingency accrual for a fiscal year 2009 terminated sales contract.

Our results for fiscal year 2010 compared to our results for fiscal year 2009

        Sales.    Our sales by market for fiscal years 2010 and 2009 are summarized as follows (dollars in millions):

	Fiscal year ended
	October 1, 2010					October 2, 2009					Increase (decrease)
	Amount		% of sales			Amount		% of sales			Amount			% of sales
Radar and Electronic Warfare	$	131.6		37	%	$	135.9		41	%	$	(4.3	)		(3	)%
Medical		70.2		19			61.2		18			9.0			15
Communications		124.0		34			106.4		32			17.6			17
Industrial		23.6		7			20.2		6			3.4			17
Scientific		11.0		3			9.2		3			1.8			20
Total	$	360.4		100	%	$	332.9		100	%	$	27.5			8	%

        Sales of $360.4 million for fiscal year 2010 were $27.5 million, or approximately 8%, higher than sales of $332.9 million for fiscal year 2009. Explanations for the sales increase or decrease by market are as follows:

•

Radar and Electronic Warfare:  The majority of our products in the radar and electronic warfare markets are for domestic and international defense and government end uses. The timing of

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order receipts and subsequent shipments in these markets may vary from year to year. On a combined basis, sales for these two markets decreased approximately 3% from $135.9 million in fiscal year 2009 to $131.6 million in fiscal year 2010. This decrease was primarily due to a decrease in sales to support the HAWK missile system and foreign radar systems, and was partially offset by an increase in sales to support electronic warfare systems and the Aegis weapons system.

•

Medical:  Sales of our medical products consist of sales for medical imaging applications, such as x-ray imaging, MRI and PET applications, and for radiation therapy applications for the treatment of cancer. The 15% increase in sales of our medical products was primarily due to increased sales to support MRI and x-ray imaging applications.

•

Communications:  Sales of our communications products consist of sales for commercial communications applications and military communications applications. The 17% increase in sales in the communications market was primarily due to increases in sales to support commercial communications applications, particularly fixed satellite broadcast applications. Sales of products to support military communications applications, including the WIN-T program, also increased. Military communications is a relatively new sector of the overall communications market for us, and, with the exception of the WIN-T program, is characterized by numerous programs that are relatively modest in size and for which the timing may vary from year to year. Over the long term, we expect our participation in military communications programs to continue to grow.

•

Industrial:  Sales in the industrial market are cyclical and are generally tied to the state of the economy. The $3.4 million increase in industrial sales was due to an increase in sales of products used in semiconductor and LCD screen manufacturing applications and in cargo screening.

•

Scientific:  Sales in the scientific market are historically one-time projects and can fluctuate significantly from period to period. The $1.8 million increase in scientific sales was primarily the result of increased sales for a fusion research program.

        Gross Profit.    Gross profit was $108.4 million, or 30.1% of sales, for fiscal year 2010 as compared to $93.5 million, or 28.1% of sales, for fiscal year 2009. Gross profit is influenced by numerous factors including sales volume and mix, pricing, raw material and manufacturing costs, and warranty costs. The primary reason for the increase in gross profit in fiscal year 2010 as compared to fiscal year 2009 was higher shipments and improved operating efficiencies from the higher shipment volume and the favorable impact from translation of Canadian costs, net of currency hedge contracts, partially offset by lower margins due to manufacturing start-up costs for new advanced antenna products and on a foreign telemetry program.

        Research and Development.    Company-sponsored research and development expenses were $12.4 million, or 3.4% of sales, for fiscal year 2010 and $10.5 million, or 3.2% of sales for fiscal year 2009. The $1.9 million increase in research and development was primarily due to development efforts on broadband communication products and solid state devices for commercial and military applications.

        Total spending on research and development, including customer-sponsored research and development, was as follows (dollars in millions):

	Fiscal year ended
	October 1, 2010		October 2, 2009
Company sponsored	$	12.4	$	10.5
Customer sponsored, charged to cost of sales		16.1		17.5
	$	28.5	$	28.0

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        The reduction to customer-sponsored research and development to $16.1 million for fiscal year 2010 from $17.5 million for fiscal year 2009 is primarily due to the reduction of development programs for advanced antenna and telemetry products at the Malibu Division as these products are transitioning to production.

        Selling and Marketing.    Selling and marketing expenses were $20.8 million, or 5.8% of sales, for fiscal year 2010, a $1.3 million increase from the $19.5 million, or 5.9% of sales, for fiscal year 2009. The increase in selling and marketing expenses in fiscal year 2010 as compared to fiscal year 2009 was primarily due to higher sales incentive expenses from improved operating performance and additional expenses to support growth in the commercial communications market.

        General and Administrative.    General and administrative expenses were $25.0 million, or 6.9% of sales, for fiscal year 2010, a $4.2 million increase from the $20.8 million, or 6.2% of sales, for fiscal year 2009. The increase in general and administrative expenses in fiscal year 2010 as compared to fiscal year 2009 was primarily due to the elimination of certain cost reduction measures and higher management bonuses as a result of improved operating performance, unfavorable currency translation expense and an increase in expenses for income tax planning services.

        Amortization of Acquisition-related Intangibles.    Amortization of acquisition-related intangibles consists of purchase accounting charges for technology and other intangible assets. Amortization of acquisition-related intangibles was $2.7 million for fiscal year 2010 and $2.8 million for fiscal year 2009. Amortizable acquisition-related intangible assets are amortized over periods of up to 50 years.

        Strategic Transaction Expenses.    On September 7, 2010, the Company and Comtech entered into a Termination and Release Agreement, by which the Company and Comtech terminated a previously announced merger agreement, dated May 8, 2010. The termination was by mutual agreement of the companies and was unanimously approved by the Company's board of directors and the board of directors of Comtech. As part of the termination, the Company paid Comtech a termination fee of $15.0 million. In addition, the Company incurred during fiscal year 2010 transaction expenses relating to the proposed merger in the amount of $4.9 million. Such transaction expenses comprised fees for investment bankers, attorneys and other professional services rendered in connection with the proposed merger, as well as with the related stockholder class lawsuit under "Business—Legal Proceedings". The total expenses of $19.9 million are presented as "strategic alternative transaction expenses" in the consolidated statement of income for fiscal year 2010.

        Interest Expense, net ("Interest Expense").    Interest Expense of $15.2 million for fiscal year 2010 was $1.8 million lower than interest expense of $17.0 million for fiscal year 2009. The reduction in interest expense in fiscal year 2010 as compared to fiscal year 2009 was primarily due to repayments of debt in fiscal year 2009.

        (Gain) Loss on Debt Extinguishment.    The gain on debt extinguishment of $0.2 million in fiscal year 2009 resulted from the repurchase of $8.0 million of our 8% Notes at a discount of $0.4 million, partially offset by a $0.2 million non-cash write-off of deferred debt issue costs.

        Income Tax Expense (Benefit).    We recorded an income tax expense of $5.6 million for fiscal year 2010 and an income tax benefit of $0.2 million for fiscal year 2009. Our effective tax rates were 45% for fiscal year 2010 and a negative 0.9% for fiscal year 2009.

        Income tax expense for fiscal year 2010 includes discrete tax expense of $2.2 million, net of discrete tax benefits, which comprises the following: (1) $3.1 million tax expense related to the uncertainty of obtaining a tax deduction for all of the expenses incurred in connection with the terminated merger with Comtech Telecommunications Corp. ("Comtech"), (2) $0.3 million tax benefit true-up related to the filing of fiscal year 2009 income tax returns, (3) $0.3 million tax benefit to adjust deferred tax accounts for a reduction to future Canadian income tax rates, and (4) $0.3 million for research and development tax credit benefits claimed on prior year income tax returns.

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        The following illustrates the impact the strategic alternative transaction expenses had on our income taxes in fiscal year 2010 (dollars in millions):

			Total			Strategic alternative transaction expenses			All other
Income (loss) before taxes			$	12.4		$	(19.9	)	$	32.3
Income tax expense (benefit), excluding discrete items				3.4			(7.8	)		11.2
	% of income before taxes			27	%		39	%		35	%
Discrete tax expense (benefit):
	Reserve for uncertainty of tax deduction for the terminated Comtech merger			3.1			3.1
	True-up related to fiscal year 2009 tax filings			(0.3	)					(0.3	)
	Adjust deferred tax accounts for reduction to future Canadian income tax rates			(0.3	)					(0.3	)
	R&D tax benefit credits claimed on prior year income tax returns			(0.3	)		—			(0.3	)
		Total discrete tax expense (benefit)	$	2.2		$	3.1		$	(0.9	)
Total income tax expense (benefit)			$	5.6		$	(4.7	)	$	10.3
	% of income before taxes			45	%		24	%		32	%

        The income tax benefit for fiscal year 2009 included several significant discrete tax benefits: (1) $4.9 million relating to our position with regard to an outstanding audit by the Canada Revenue Agency ("CRA"), (2) $1.7 million for the correction of immaterial errors to tax accounts that should have been recorded in prior year's financial statements, (3) $0.7 million related to certain provisions of the California Budget Act of 2008 signed on February 20, 2009, which will allow a taxpayer to elect an alternative method to apportion taxable income to California for tax years beginning on or after January 1, 2011, and (4) $0.6 million for refunds claimed on prior year income tax returns based on the results of a foreign nexus study. In fiscal year 2009, we also recorded a $0.4 million U.S. research and development tax credit.

        In December 2008, a new tax treaty protocol between Canada and the U.S. became effective. The new treaty requires mandatory arbitration for the resolution of double taxation disputes not settled through the competent authority process. As a result of this new treaty, our tax position on an outstanding audit by the CRA became more favorable, and we reduced our tax contingency reserve in Canada by $2.8 million, and established an income tax receivable and recognized an income tax benefit in the U.S for $2.8 million; this tax benefit was partially offset by a related increase in deferred tax liabilities of $0.7 million.

        The $1.7 million correction to prior year's financial statements in fiscal year 2009 comprises $0.9 million for changes in foreign income tax rates that were not updated in a timely manner and $0.8 million recorded in the fourth quarter of fiscal year 2009 to true-up the 2008 income tax provision. We believe that the impact of this correction was not material to our consolidated financial statements in fiscal year 2009 or in any of the prior year consolidated financial statements.

        Net Income.    Net income was $6.7 million, or 1.9% of sales, for fiscal year 2010 as compared to $23.5 million, or 7.1% of sales, for fiscal year 2009. Net income for both fiscal years 2009 and 2010 was greatly impacted by (1) for fiscal year 2009, the discrete tax benefits discussed above under the heading "Income Tax Expense (Benefit)," aggregating to a $7.9 million benefit, (2) for fiscal year 2010, the $0.9 million of discrete tax benefits in the "All other" column of the table above under the heading "Income Tax Expense (Benefit)," and (3) for fiscal year 2010, the after-tax expense from strategic

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alternative transaction expenses of $15.2 million. Excluding these items, fiscal year 2010 net income was approximately $5.4 million higher than fiscal year 2009 primarily due to higher shipment volume and improved operating efficiency from the higher shipment volume, and lower interest expense, in fiscal year 2010, partially offset by higher operating expense in fiscal year 2010. The higher operating expense in fiscal year 2010 is primarily due to higher management bonuses and sales incentive expenses because of improved operating performance and from the elimination of certain cost reduction initiatives in fiscal year 2010.

        EBITDA.    EBITDA was $38.6 million, or 10.7% of sales, for fiscal year 2010 as compared to $51.0 million, or 15.3% of sales, in fiscal year 2009. The $12.4 million decrease in EBITDA in fiscal year 2010 as compared to fiscal year 2009 was due primarily to strategic alternative transaction expenses of $19.9 million and higher operating expense in fiscal year 2010, partially offset by higher shipment volume and improved operating efficiency from the higher shipment volume in fiscal year 2010.

        Calculation of Management Bonuses.    Management bonuses were $3.3 million in fiscal year 2010 compared to $1.2 million in fiscal year 2009. Management bonuses for fiscal years 2010 and 2009 were calculated pursuant to our Management Incentive Plan ("MIP") and were based on three factors: (1) EBITDA as adjusted for purposes of calculating management bonuses; (2) a measure of cash generated by operations; and (3) individual goals that were customized for certain participating members of management. The weight given to each of these factors varied for each person. Generally, for our officers, equal weight was given to the first two factors, and the third factor was not applicable. For our other members of management, equal weight was given to each of the three factors described above. Management bonuses are paid in cash approximately three months after the end of the fiscal year. EBITDA as adjusted for purposes of calculating management bonuses is equal to EBITDA for the fiscal year adjusted to exclude the impact of certain non-recurring or non-cash charges as pre-determined in our MIP for the fiscal year. EBITDA for purposes of calculating management bonuses for fiscal year 2010 was $61.6 million compared to $53.5 million in fiscal year 2009. The non-recurring and non-cash charges that were excluded from EBITDA in calculating management bonuses were (a) for fiscal year 2010, strategic alternative transaction expenses of $19.9 million and stock-based compensation expense of $3.0 million, and (b) for fiscal year 2009, gain on debt extinguishment of $0.2 million and stock-based compensation expense of $2.7 million. We are presenting EBITDA as adjusted for purposes of calculating management bonuses here to help investors understand how our management bonuses were calculated, and not as a measure to be used by investors to evaluate our operating results or liquidity.

Our results for fiscal year 2009 compared to our results for fiscal year 2008

        Sales.    Our sales by market for fiscal years 2009 and 2008 are summarized as follows (dollars in millions):

		Fiscal year ended
		October 2, 2009					October 3, 2008					Decrease
		Amount		% of sales			Amount		% of sales			Amount			% of sales
Radar and Electronic Warfare		$	135.9		41	%	$	151.8		40	%	$	(15.9	)		(10	)%
Medical			61.2		18			65.8		18			(4.6	)		(7	)
Communications			106.4		32			117.8		32			(11.4	)		(10	)
Industrial			20.2		6			25.1		7			(4.9	)		(20	)
Scientific			9.2		3			9.5		3			(0.3	)		(3	)
	Total	$	332.9		100	%	$	370.0		100	%	$	(37.1	)		(10	)%

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        In the first six months of fiscal year 2009, product shipments in our defense markets, which include our radar and electronic warfare markets, were delayed due to delays in the receipt of orders, having a negative effect on our defense sales. In the last six months of fiscal year 2009, the order levels in our defense markets stabilized, but certain defense programs experienced delays in orders and subsequent sales.

        Our commercial markets, which include our medical, commercial communications, industrial and scientific markets, were negatively impacted in fiscal year 2009 by the weakening of the U.S. and foreign economy. Many of the commercial programs in which we participate depend on customers upgrading their current equipment or expanding their infrastructures. With the softening of global economy, many of our customers delayed, reduced or cancelled their upgrade or expansion plans. We believe that the weak global economy resulted in a decrease in demand for our products to support commercial programs in fiscal year 2009.

        Sales of $332.9 million for fiscal year 2009 were $37.1 million, or approximately 10%, lower than sales of $370.0 million for fiscal year 2008. Explanations for the sales decrease by market are as follows:

•

Radar and Electronic Warfare:  The majority of our sales in the radar and electronic warfare markets are products for domestic and international defense and government end uses. The timing of the receipt of orders and subsequent shipments in these markets may vary from year to year. On a combined basis, sales for these two markets decreased approximately 10% from $151.8 million in fiscal year 2008 to $135.9 million in fiscal year 2009, primarily due to an expected $8.7 million decrease in shipments of products to support the Aegis weapons system and decreases in sales for several other radar and electronic warfare programs due to the timing of order receipts for those programs. These decreases were partially offset by the shipment of products from development programs to support radar applications.

•

Medical:  Sales of our medical products consist of sales for medical imaging applications, such as x-ray imaging, MRI and PET applications, and for radiation therapy applications for the treatment of cancer. The 7% decrease in medical product sales was due to decreased sales of x-ray imaging products to international customers as a result of the weakness of global economies. Our sales of products to support MRI and radiation therapy applications remained stable in fiscal year 2009.

•

Communications:  Sales of our communications products consist of sales for commercial communications applications and military communications applications. The 10% decrease in sales in the communications market was primarily attributable to decreases in sales to support certain commercial communications applications, including satellite news gathering and direct-to-home broadcast applications. We believe that the decreases were largely due to the weakness of global economies. These decreases were partially offset by an increase in sales of products for military communications programs, which was a relatively new sector of the overall communications market for us.

•

Industrial:  Sales in the industrial market are cyclical and are generally tied to the state of the economy. The $4.9 million decrease in industrial sales was attributable to decreases in sales of products used in a wide variety of industrial applications.

•

Scientific:  Sales in the scientific market are historically one-time projects and can fluctuate significantly from period to period. The $0.3 million decrease in scientific sales was primarily the result of the timing of certain scientific programs.

        Cost-reduction Initiatives in Fiscal Year 2009.    In fiscal year 2009, we implemented a number of temporary and permanent cost-saving measures to counter the impact of lower sales due to the worldwide economic slowdown, including reducing our worldwide workforce by approximately 7%, or

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120 people. In addition, we implemented a salary freeze and salary reductions, temporary shutdowns of facilities, increased employees' mandatory time off, initiated work-share programs and reduced our contributions to certain employee retirement plans.

        Gross Profit.    Gross profit was $93.5 million, or 28.1% of sales, for fiscal year 2009 as compared to $108.9 million, or 29.4% of sales, for fiscal year 2008. The primary reason for the reduction in gross profit in fiscal year 2009 as compared to fiscal year 2008 was lower sales volume and, therefore, lower manufacturing cost absorption due to the reduction in sales volume. This decrease was partially offset by improved gross margins at our Malibu Division and lower expenses from cost-reduction initiatives in fiscal year 2009.

        Research and Development.    Company-sponsored research and development expenses were $10.5 million, or 3.2% of sales, for fiscal year 2009 and $10.8 million, or 2.9% of sales for fiscal year 2008. Customer-sponsored research and development expenses were $17.5 million in fiscal year 2009, an increase of $5.5 million as compared to fiscal year 2008, representing an increase of approximately 46%. This increase was primarily in advanced antenna system products used for telemetry and tactical common data link ("TCDL") applications.

        Total spending on research and development, including customer-sponsored research and development, was as follows (dollars in millions):

	Fiscal year ended
	October 2, 2009		October 3, 2008
Company sponsored	$	10.5	$	10.8
Customer sponsored, charged to cost of sales		17.5		12.0
	$	28.0	$	22.8

        Selling and Marketing.    Selling and marketing expenses were $19.5 million, or 5.9% of sales, for fiscal year 2009, a $1.6 million decrease from the $21.1 million in fiscal year 2008. The reduction in selling and marketing expenses in fiscal year 2009 as compared to fiscal year 2008 was primarily due to lower expenses from cost-reduction initiatives and the favorable impact from currency translation of our foreign-based expenses in fiscal year 2009.

        General and Administrative.    General and administrative expenses were $20.8 million, or 6.2% of sales, for fiscal year 2009, a $2.1 million decrease from the $22.9 million, or 6.2% of sales, for fiscal year 2008. The decrease in general and administrative expenses in fiscal year 2009 as compared to fiscal year 2008 was primarily due to lower expenses related to the implementation of cost-reduction initiatives during fiscal year 2009.

        Amortization of Acquisition-related Intangibles.    Amortization of acquisition-related intangibles consists of purchase accounting charges for technology and other intangible assets. Amortization of acquisition-related intangibles was $2.8 million for fiscal year 2009 and $3.1 million for fiscal year 2008. The $0.3 million decrease in amortization of acquisition- related intangibles in fiscal year 2009 was primarily due to completed amortization of customer backlog in fiscal year 2008 for our Malibu Division, which was acquired in August 2007. Amortizable acquisition-related intangible assets are amortized over periods of up to 50 years.

        Interest Expense, net ("Interest Expense").    Interest Expense of $17.0 million for fiscal year 2009 was $2.1 million lower than interest expense of $19.1 million for fiscal year 2008. The reduction in interest expense in fiscal year 2009 as compared to fiscal year 2008 was primarily due to repayments of debt.

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        (Gain) Loss on Debt Extinguishment.    The gain on debt extinguishment of $0.2 million in fiscal year 2009 resulted from the repurchase of $8.0 million of our 8% Notes at a discount of $0.4 million, partially offset by a $0.2 million non-cash write-off of deferred debt issue costs. The loss on debt extinguishment of $0.6 million in fiscal year 2008 resulted from the early redemption of $10.0 million of our floating rate senior notes, consisting of $0.4 million in non-cash write-off of deferred debt issue costs and issue discount costs and $0.2 million in cash payments for call premiums.

        Income Tax (Benefit) Expense.    We recorded an income tax benefit of $0.2 million for fiscal year 2009 and an income tax expense of $10.8 million for fiscal year 2008. Our effective tax rates were a negative 0.9% for fiscal year 2009 and 34.6% for fiscal year 2008.

        The income tax benefit for fiscal year 2009 included several significant discrete tax benefits: (1) $4.9 million relating to our position with regard to an outstanding audit by the CRA, (2) $1.7 million for the correction of immaterial errors to tax accounts that should have been recorded in prior year's financial statements, (3) $0.7 million related to certain provisions of the California Budget Act of 2008 signed on February 20, 2009, which will allow a taxpayer to elect an alternative method to apportion taxable income to California for tax years beginning on or after January 1, 2011, and (4) $0.6 million for refunds claimed on prior year income tax returns based on the results of a foreign nexus study. In fiscal year 2009, we also recorded a $0.4 million U.S. research and development tax credit.

        In December 2008, a new tax treaty protocol between Canada and the U.S. became effective. The new treaty requires mandatory arbitration for the resolution of double taxation disputes not settled through the competent authority process. As a result of this new treaty, our tax position on an outstanding audit by the CRA became more favorable, and we reduced our tax contingency reserve in Canada by $2.8 million, and established an income tax receivable and recognized an income tax benefit in the U.S for $2.8 million; this tax benefit was partially offset by a related increase in deferred tax liabilities of $0.7 million.

        The $1.7 million correction to prior year's financial statements in fiscal year 2009 comprises $0.9 million for changes in foreign income tax rates that were not updated in a timely manner and $0.8 million recorded in the fourth quarter to true-up the 2008 income tax provision. Fiscal year 2008 included a discrete tax benefit of $0.4 million that is attributable to fiscal year 2007 related to the correction of an immaterial error in the computation of the deferred taxes for warranty expenses in a foreign tax jurisdiction. We believe that the impact of these corrections was not material to our fiscal year 2009 consolidated financial statements or in any of the prior year consolidated financial statements.

        Net Income.    Net income was $23.5 million, or 7.1% of sales, for fiscal year 2009 as compared to $20.4 million, or 5.5% of sales, for fiscal year 2008. The $3.1 million increase in net income in fiscal year 2009 as compared to fiscal year 2008 was primarily due to discrete income tax benefits, lower expenses from the implementation of cost-reduction initiatives and lower interest expense in fiscal year 2009, partially offset by lower gross profit from the reduction in sales volume in fiscal year 2009.

        EBITDA.    EBITDA was $51.0 million, or 15.3% of sales, for fiscal year 2009 as compared to $61.3 million, or 16.6% of sales, in fiscal year 2008. The $10.3 million decrease in EBITDA in fiscal year 2009 as compared to fiscal year 2008 was due primarily to lower gross profit from the reduction in sales volume, partially offset by lower expenses from the implementation of cost-reduction initiatives in fiscal year 2009.

        Calculation of Management Bonuses.    Management bonuses were $1.2 million in fiscal year 2009 compared to $1.9 million in fiscal year 2008. Management bonuses for fiscal years 2009 and 2008 were calculated pursuant to our MIP and were based on three factors: (1) EBITDA as adjusted for purposes of calculating management bonuses; (2) a measure of cash generated by operations; and (3) individual

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goals that were customized for certain participating members of management. The weight given to each of these factors varied for each person. Generally, for our officers, equal weight was given to the first two factors, and the third factor was not applicable. For our other members of management, equal weight was given to each of the three factors described above. Management bonuses are paid in cash approximately three months after the end of the fiscal year. EBITDA as adjusted for purposes of calculating management bonuses is equal to EBITDA for the fiscal year adjusted to exclude the impact of certain non-recurring or non-cash charges as pre-determined in our MIP for the fiscal year. EBITDA for purposes of calculating management bonuses for fiscal year 2009 was $53.5 million compared to $64.0 million in fiscal year 2008. The non-recurring and non-cash charges that were excluded from EBITDA in calculating management bonuses were (a) for fiscal year 2009, gain on debt extinguishment of $0.2 million and stock-based compensation expense of $2.7 million, and (b) for fiscal year 2008, loss on debt extinguishment of $0.6 million and stock-based compensation expense of $2.1 million. We are presenting EBITDA as adjusted for purposes of calculating management bonuses here to help investors understand how our management bonuses were calculated, and not as a measure to be used by investors to evaluate our operating results or liquidity.

Liquidity And Capital Resources

Overview

        Our liquidity is affected by many factors, some of which are based on normal ongoing operations of our business and others that are related to uncertainties in the markets in which we compete and other global economic factors. We have historically financed, and intend to continue to finance, our capital and working capital requirements including debt service and internal growth, through a combination of cash flows from our operations and borrowings under credit facilities. Our primary uses of cash are cost of sales, operating expenses, debt service and capital expenditures.

Cash and Working Capital

        The following summarizes our cash and cash equivalents and working capital (dollars in millions):

	Quarter Ended December 31, 2010		Three Months Ended January 1, 2010		Year Ended October 1, 2010		Year Ended October 2, 2009		Year Ended October 3, 2008
Cash and cash equivalents	$	59.9	$	35.1	$	42.8	$	26.2	$	28.7
Working capital	$	50.1	$	99.7	$	44.8	$	92.4	$	88.1

        We invest cash balances in excess of operating requirements in overnight U.S. Government securities and money market accounts. In addition to the above cash and cash equivalents, we had restricted cash of $1.8 million and $3.1 million as of October 1, 2010, and December 31, 2010, respectively, consisting of bank guarantees from customer advance payments to our international subsidiaries and cash collateral for certain performance bonds. The bank guarantees become unrestricted cash when performance under the sales contract is complete. The cash collateral for the performance bonds will become unrestricted cash when the performance bonds expire.

        The significant factors underlying the $16.7 million net increase in cash and cash equivalents during fiscal year 2010 were the net cash provided by our operating activities of $19.8 million and proceeds and tax benefits of $1.4 million from employee stock purchases and exercise of stock options, partially offset by capital expenditures of $4.5 million. The significant factors underlying the net increase in cash and cash equivalents during the first quarter of fiscal year 2011 were the net cash provided by our operating activities of $17.5 million and proceeds and tax benefits of $0.4 million from employee stock purchases and exercise of stock options, partially offset by capital expenditures of $0.4 million and the payment for amendment to our senior credit facilities of $0.4 million.

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        As of December 31, 2010 and October 1, 2010, we had $195.0 million in total principal amount of debt outstanding. As of December 31, 2010, we had borrowing availability of $55.5 million under the revolver under our senior credit facilities.

        In December 2010, our European subsidiary entered into a $2.0 million bank guarantee facility to be used for issuance of bank guarantees for advanced payments from customers and for securing certain of our obligations in projects under customer contracts. No guarantees were outstanding under such facility at December 31, 2010.

        As more fully described below, our most significant debt covenant compliance requirement is maintaining a secured leverage ratio of 3.75:1. Our current secured leverage ratio is approximately 0.10:1.

Historical Operating, Investing and Financing Activities

Our operating, investing and financing activities for three months ended December 31, 2010 and three months ended January 1, 2010

        In summary, our cash flows were as follows (in millions):

		Quarter Ended
		December 31, 2010			January 1, 2010
Net cash provided by operating activities		$	17.5		$	9.6
Net cash used in investing activities			(0.4	)		(0.8	)
Net cash provided by financing activities			—			0.2
	Net increase in cash and cash equivalents	$	17.1		$	9.0

Operating Activities

        During the first quarter of fiscal years 2011 and 2010, we funded our operating activities through cash generated internally. Cash provided by operating activities is net income adjusted for certain non-cash items and changes to working capital items.

        Net cash provided by operating activities of $17.5 million in the first quarter of fiscal year 2011 was attributable to net income of $2.2 million, depreciation, amortization and other non-cash charges of $2.5 million and net cash provided by working capital of $12.8 million. The primary working capital sources of cash in the first quarter of fiscal year 2011 were an increase in advance payments from customers, an increase in accrued expenses and a decrease in accounts receivable. Advanced payments from customers increased due to an increase in certain sales orders, which allow for billings at the beginning of the contract term. Accrued expense increased due to expenses incurred in connection with the pending Merger Agreement that remained unpaid as of December 31, 2010 and due to the timing of interest payments on our debt. Accounts receivable decreased due to a decline in sales for the first quarter of fiscal year 2011 as compared to the immediately preceding quarter and due to improvement in collection efficiency. The aforementioned working capital sources of cash were partially offset by an increase in inventories, a decrease in accounts payable, an increase in restricted cash and a decrease in net income tax payable. The increase in inventories resulted from increased inventory purchases to support increased orders and the sales level anticipated for the remaining quarters of fiscal year 2011. Accounts payable decreased mainly due to timing of payments to trade vendors. Restricted cash increased due to cash collateral obtained for certain performance bonds. The decrease in income tax payable, net, primarily reflects lower taxable income compared to the immediately preceding quarter and tax payments made during the quarter.

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        Net cash provided by operating activities of $9.6 million in the first quarter of fiscal year 2010 was attributable to net income of $3.8 million, depreciation, amortization and other non-cash charges of $4.5 million and net cash provided by working capital of $1.3 million. The primary working capital sources of cash in the first quarter of fiscal year 2010 were a decrease in accounts receivable and an increase in accrued expenses. The decrease in accounts receivable resulted primarily from the decreased sales volume during the first quarter of fiscal year 2010 as compared to the fourth quarter of fiscal year 2009, while the increase in accrued expenses was primarily due to an increase in interest payable related to the timing of interest payments on our debt. The aforementioned working capital sources of cash were partially offset by an increase in inventories and a decrease in accounts payable. The increase in inventories resulted from increased purchases in anticipation of higher sales volume for the remaining quarters of fiscal year 2010. Accounts payable decreased mainly due to timing of payments to trade vendors.

Investing Activities

        Investing activities for the first quarter of fiscal years 2011 and 2010 comprised $0.4 million and $0.8 million, respectively, of capital expenditures.

Financing Activities

        Net cash provided by financing activities for the first quarter of fiscal year 2011 consisted of proceeds and tax benefits from employee stock purchases and exercise of stock options with an aggregate total of $0.4 million, offset by the payment of fees and expenses for an amendment to our senior credit facilities of $0.4 million.

        Net cash provided by financing activities for the first quarter of fiscal year 2010 was attributable to $0.2 million in proceeds from employee stock purchases.

        If the leverage ratio under our amended and restated senior credit facilities exceeds 3.5:1 at the end of any fiscal year, then we are required to make an annual prepayment within 90 days after the end of the fiscal year based on a calculation of excess cash flow, as defined in the senior credit facilities, multiplied by a factor of 50%, less any optional prepayments made during the fiscal year. There was no excess cash flow payment due for fiscal year 2010, and therefore, no excess cash flow payment was made in the first quarter of fiscal year 2011.

Our operating, investing and financing activities for fiscal year 2010, 2009 and 2008

        In summary, our cash flows were as follows (dollars in millions):

	Fiscal year ended
	October 1, 2010			October 2, 2009			October 3, 2008
Net cash provided by operating activities	$	19.8		$	30.1		$	33.9
Net cash used in investing activities		(4.5	)		(3.3	)		(2.8	)
Net cash provided by (used) in financing activities		1.4			(29.3	)		(22.9	)
Net increase (decrease) in cash and cash equivalents	$	16.7		$	(2.5	)	$	8.2

Operating Activities

        In fiscal years 2010, 2009 and 2008, we funded our operating activities through cash generated internally. Cash provided by operating activities is net income adjusted for certain non-cash items and changes to working capital items.

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        Net cash provided by operating activities of $19.8 million in fiscal year 2010 was attributable to net income of $6.7 million, depreciation, amortization and other non-cash charges of $11.1 million, and net cash provided by working capital of $2.0 million. The primary working capital sources of cash in fiscal year 2010 were an increase in accrued liabilities, income tax payable, net, and accounts payable, partially offset by an increase in inventories. The increase in accrued liabilities reflects increased payroll and paid-time off accruals, as well as incentive compensation as a result of improved operating results. The expenses incurred in connection with the terminated Comtech merger agreement that remained unpaid as of October 1, 2010 also contributed to the increase in accrued liabilities. The increase in income tax payable, net, primarily reflects tax expense accruals related to the uncertainty of obtaining a tax deduction for all of the expenses incurred in connection with the Comtech merger agreement. The increase in accounts payable was primarily due to higher inventory levels, which resulted primarily from increased inventory purchases to support increased orders and the sales level anticipated for the first half of fiscal year 2011.

        Net cash provided by operating activities of $30.1 million in fiscal year 2009 was attributable to net income of $23.5 million, depreciation, amortization and other non-cash charges of $14.2 million, partially offset by $7.6 million net cash used for working capital. The primary working capital uses of cash in fiscal year 2009 were the change in income tax payable primarily attributable to discrete tax benefits related to an outstanding audit by the CRA, a decrease in accrued expenses and an increase in inventories. The decrease in accrued expenses related primarily to the timing of payroll and employee vacations and to lower incentive compensation accruals. The increase in inventories was due mainly to more work in process for fiscal year 2010 sales. These uses of cash were slightly offset by decreases in receivables and an increase in accounts payable. Accounts receivables decreased as a result primarily by decreased sales. The increase in accounts payable was attributable primarily to the timing of vendor payments.

        Net cash provided by operating activities of $33.9 million in fiscal year 2008 was attributable to net income of $20.4 million, depreciation, amortization and other non-cash charges of $12.9 million and net cash provided by working capital of $0.6. The primary working capital sources of cash in fiscal year 2008 were decreases in receivables and inventories and release of restricted cash. Accounts receivables decreased due to timing and improved collection of trade receivables. Inventories decreased due to an effort to reduce inventory carrying levels. These sources of cash were significantly offset by decreases in accrued expenses, product warranty and income taxes payable. The decrease in accrued expenses related primarily to the timing of payroll and employee vacations, combined with lower incentive compensation and a decrease in consulting and professional costs.

Investing Activities

        Investing activities for fiscal years 2010 and 2009 consisted of $4.5 million and $3.3 million capital expenditures, respectively.

        Investing activities for fiscal year 2008 consisted primarily of $4.3 million capital expenditures and $0.1 million payment of patent application fees. The amount of cash used in investing activities was partially offset by a $1.6 million escrow refund related to the August 2007 acquisition of Malibu Research, Inc.

Financing Activities

        Net cash provided by financing activities for fiscal year 2010 consisted of proceeds and tax benefits of $1.4 million from employee stock purchases and exercise of stock options.

        Net cash used in financing activities for fiscal year 2009 consisted primarily of repayment of $22.7 million of our prior term loan credit facility and repurchase of $7.6 million of our 8% Notes, net

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of $0.4 million discount, partially offset by $1.0 million in proceeds from employee stock purchases and stock option exercises.

        Net cash used in financing activities for fiscal year 2008 consisted primarily of $2.8 million of treasury stock purchases under the stock repurchase program discussed below, redemption of $10.0 million in principal amount of the FR Notes and repayments aggregating $11.0 million under our prior term loan credit facility. The cash used in financing activities for fiscal year 2008 was partially offset by $0.9 million in proceeds from employee stock purchases.

Liquidity Post-Transactions

        As of December 31, 2010, on a pro forma basis after giving effect to the Transactions, we would have had cash and cash equivalents of $20.7 million.

        Our primary future cash needs on a recurring basis will be for working capital, capital expenditures and significant debt service obligations as a result of the Transactions. We believe that cash flows from operations and availability under our new revolving credit facility included in the Senior Secured Credit Facilities will be sufficient to fund our working capital needs, capital expenditures and other business requirements for at least the next twelve months. We may need to incur additional financings to make strategic acquisitions or investments or if our cash flows from operations are less than we expect. We cannot assure you that financing will be available to us on acceptable terms or that financing will be available at all.

        Our ability to make payments to fund working capital, capital expenditures, debt service, strategic acquisitions, joint ventures and investments will depend on our ability to generate cash in the future, which is subject to general economic, financial, competitive, regulatory and other factors that are beyond our control. Future indebtedness may impose various restrictions and covenants on us which could limit our ability to respond to market conditions, to provide for unanticipated capital investments or to take advantage of business opportunities.

        We are highly leveraged. On a pro forma basis as of December 31, 2010, our total indebtedness would have been $365.0 million (excluding approximately $4.5 million of outstanding letters of credit), including the notes. We also would have had an additional $25.5 million available for borrowing under our new revolving credit facility. Our liquidity requirements will be significant, primarily due to debt service requirements. On a pro forma basis after giving effect to the Transactions, our cash interest expense for the three months ended December 31, 2010, would have been $6.3 million.

New Senior Secured Credit Facilities

        In connection with the Transactions, on February 11, 2011 we entered into the Senior Secured Credit Facilities consisting of (i) a $150.0 million six-year term loan facility; and (ii) a $30.0 million five-year revolving credit facility. We borrowed the full amount of the term loan facility thereunder in connection with the Merger, and the revolving credit facility was undrawn at closing (other than for approximately $4.5 million of outstanding letters of credit). We have the option to increase the amount available under the Senior Secured Credit Facilities by up to an aggregate of $50.0 million on an uncommitted basis.

        The revolving credit facility includes borrowing capacity available for letters of credit and for short-term borrowings referred to as the swingline borrowings. Our obligations under the Senior Secured Credit Facilities are fully and unconditionally guaranteed by the Parent and, subject to certain exceptions, each of the Parent's existing and future domestic restricted subsidiaries (other than CPII). In addition, our obligations under the Senior Secured Credit Facilities and the guarantees of those obligations, are secured by (a) pledges of all of the equity interests held by us and each guarantor and

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(b) liens on substantially all of our assets and the assets of each guarantor, in each case subject to certain exceptions.

        Borrowings under the term loan facility and the revolving credit facility bear interest, at our option, at a rate equal to a margin over either (a) a base rate or (b) a LIBOR rate. The Senior Secured Credit Facilities are subject to amortization and prepayment requirements and contain customary representations and warranties, covenants, events of default and other provisions described under "Description of the Senior Secured Credit Facilities."

8.00% Senior Notes due 2018

        On February 11, 2011, we issued an aggregate of $215 million in a private placement of 8.00% Senior Notes due 2018. The outstanding notes are our senior unsecured obligations. The Parent and, subject to certain exceptions, each of the Parent's existing and future domestic restricted subsidiaries (other than CPII) guarantee the outstanding notes on a senior unsecured basis. The outstanding notes bear interest at the rate of 8.00% per year. Interest is payable in cash.

        The indenture governing the outstanding notes limits our and our restricted subsidiaries' ability to incur additional indebtedness or issue certain preferred stock; pay dividends and make other restricted payments; make certain investments; sell assets; create liens; consolidate, merge or sell all or substantially of our assets; enter into transactions with affiliates and designate subsidiaries as unrestricted subsidiaries. These covenants are subject to important exceptions as described under "Description of the Exchange Notes—Certain covenants."

Contractual Obligations

        The following table summarizes our significant contractual obligations as of December 31, 2010 on a pro forma basis after giving effect to the Transactions and the effect that such obligations are expected to have on our liquidity and cash flows in future periods (dollars in thousands):

		Fiscal Year
		Total		2011 (remaining nine months)		2012-2013		2014-2015		Thereafter
Operating leases		$	6,485	$	1,173	$	2,183	$	754	$	2,375
Purchase commitments			32,156		29,674		2,482		—		—
Debt obligations			365,000		750		3,000		3,000		358,250
Interest on debt obligations			164,106		18,511		49,156		48,856		47,583
Uncertain tax positions, including interest			7,322		3,262		4,060		—		—
	Total cash obligations	$	575,069	$	53,370	$	60,881	$	52,610	$	408,208
Standby letters of credit		$	4,500	$	4,500

        The pro forma amounts for debt obligations and interest on debt obligations assume (1) that the respective debt instruments will be outstanding until their scheduled maturity dates, (2) that interest rates in effect on December 31, 2010 remain constant for future periods, and (3) a debt level based on mandatory repayments according to the contractual amortization schedule.

        The expected timing of payment amounts of the obligations in the above table is estimated based on current information; timing of payments and actual amounts paid may be different.

        Leases:    We are committed to minimum rentals under non-cancelable operating lease agreements, primarily for land and facility space, that expire on various dates through 2050. Certain of our leases

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provide for escalating lease payments. Assets subject to capital leases as of December 31, 2010 were not material.

        Purchase Commitments:    As of December 31, 2010, we had known purchase commitments of $32.2 million, which include primarily future purchases for inventory-related items under various purchase arrangements as well as other obligations in the ordinary course of business that we cannot cancel or for which we would be required to pay a termination fee in the event of cancellation.

        Debt Obligations:    Long-term debt on a pro forma basis comprises the following (dollars in millions):

		December 31, 2010
Senior Secured Credit Facilities
	Revolving credit facility	$	—
	Term loan facility		150.0
8.00% Senior Notes due 2018			215.0
Less: Current portion			—
	Long-term portion	$	365.0
Standby letters of credit		$	4.5

Contingent Income Tax Obligations

        As of October 1, 2010, our total unrecognized tax benefits, including any related interest accrual, were reported as income taxes payable (current liability) of $3.8 million and other long-term liabilities of $3.9 million, in our consolidated balance sheet. As of December 31, 2010, our total unrecognized tax benefit, which excludes any related interest accruals, was $6.8 million. See Note 11 to the accompanying audited consolidated financial statements and Note 10 to the accompanying unaudited consolidated financial statements for more information, included elsewhere in this prospectus.

Capital Expenditures

        Our continuing operations typically do not have large recurring capital expenditure requirements. Capital expenditures are generally made to replace existing assets, increase productivity, facilitate cost reductions or meet regulatory requirements. Total capital expenditures for the first quarter of fiscal year 2011 were $0.4 million. Total capital expenditures for fiscal year 2010 were $4.5 million. In fiscal year 2011, ongoing capital expenditures are expected to be approximately $5.0 to $6.0 million and to be funded by cash flows from operating activities.

Recent Accounting Pronouncements

        See Note 2 to the accompanying audited consolidated financial statements and the accompanying unaudited consolidated financial statements for information regarding the effect of new accounting pronouncements on our financial statements, included elsewhere in this prospectus.

Critical Accounting Policies And Estimates

        Our consolidated financial statements are prepared in accordance with generally accepted accounting principles, or GAAP, in the United States of America, which require us to make certain estimates, judgments and assumptions. We believe that the estimates, judgments and assumptions upon which we rely are reasonable based upon various factors and information available to us at the time that these estimates, judgments and assumptions are made. These factors and information may include, but are not limited to, history and prior experience, experience of other enterprises in the same

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industry, new related events, current economic conditions and information from third-party professionals. The estimates, judgments and assumptions we make can affect the reported amounts of assets and liabilities as of the date of the financial statements, as well as the reported amounts of revenues and expenses during the periods presented. To the extent there are material differences between these estimates, judgments or assumptions and actual results, our financial statements will be affected.

        We believe that the following critical accounting policies are the most significant to the presentation of our financial statements and require the most subjective and complex judgments. These matters, and the judgments and uncertainties affecting them, are also essential to understanding our reported and future operating results. See Note 1 to our audited consolidated financial statements for a more comprehensive discussion of our significant accounting policies, included elsewhere in this prospectus.

Revenue recognition

        We generally recognize revenue upon shipment of product, following receipt of written purchase orders, when the price is fixed or determinable, title has transferred and collectability is reasonably assured. Revenue recognized under the percentage-of-completion method of accounting is determined on the basis of costs incurred and estimates of costs at completion, which require management estimates of future costs. Changes in estimated costs at completion over time could have a material impact on our operating results.

        Revenue from contracts that contain multiple elements, through October 1, 2010, was allocated to each respective element or unit of accounting, based on each element's relative fair value using vendor-specific objective evidence ("VSOE") or third-party evidence ("TPE"), if determinable, and was recognized when the respective revenue recognition criteria for each element was met. Effective October 2, 2010, we are required to adopt the provisions of the Financial Accounting Standards Board ("FASB") Accounting Standards Update 2009-13, "Revenue Recognition (Topic 605): Multiple Deliverable Revenue Arrangements—A Consensus of the FASB Emerging Issues Task Force," which, among other things, requires revenue to be allocated to each element based on the relative selling price method in the absence of VSOE or TPE. See Note 2 to the accompanying audited consolidated financial statements, included elsewhere in this prospectus. Changes in assumptions or judgments or changes to the elements in a contract could cause a material impact on our operating results.

Inventory valuation

        We assess the valuation of inventory and periodically write down the value for estimated excess and obsolete inventory based upon actual usage and estimates about future demand. The excess balance determined by this analysis becomes the basis for our excess inventory charge. Management personnel play a key role in our excess inventory review process by providing updated sales forecasts, managing product rollovers and working with manufacturing to maximize recovery of excess inventory. If our estimates regarding demand are inaccurate or changes in technology affect demand for certain products in an unforeseen manner, we may incur losses or gains in excess of our established markdown amounts that could be material.

        Management also reviews the carrying value of inventory for lower of cost or market on an individual product or contract basis. A loss is charged to cost of sales if the estimated product cost or the contract cost at completion is in excess of net realizable value (selling price less estimated cost of disposal). If the actual contract cost at completion is different than originally estimated, then a loss or gain provision adjustment would be recorded that could have a material impact on our operating results.

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Recoverability of long-lived assets

        We account for goodwill and other intangible assets in accordance with the FASB Accounting Standards Codification ("ASC") Topic 350, "Intangibles—Goodwill and Other." ASC 350 requires that goodwill and identifiable intangible assets with indefinite useful lives be tested for impairment at least annually. ASC 350 and ASC 360, "Property, Plant and Equipment," also require that intangible assets subject to amortization be amortized over their respective estimated useful lives and reviewed for impairment. We amortize identifiable intangible assets on a straight-line basis over their useful lives of up to 50 years.

        We assess the recoverability of the carrying value of goodwill and other intangible assets with indefinite useful lives at least annually or whenever events or changes in circumstances indicate that the carrying amount of any of these assets may not be fully recoverable. Recoverability of goodwill is measured at the reporting unit level (our six divisions) based on a two-step approach. First, the carrying amount of the reporting unit is compared to the fair value as estimated by the future net discounted cash flows expected to be generated by the reporting unit. To the extent that the carrying value of the reporting unit exceeds the fair value of the reporting unit, a second step is performed, wherein the reporting unit's assets and liabilities are valued. The implied fair value of goodwill is calculated as the fair value of the reporting unit in excess of the fair value of all non-goodwill assets and liabilities allocated to the reporting unit. To the extent the reporting unit's carrying value of goodwill exceeds its implied fair value, impairment exists and must be recognized. This process requires the use of discounted cash flow models that utilize estimates of future revenue and expenses as well as the selection of appropriate discount rates. There is inherent uncertainty in these estimates, and changes in these factors over time could result in an impairment charge.

        At October 1, 2010 and October 2, 2009, the carrying amount of goodwill and other intangible assets with indefinite useful lives was $165.5 million. Based on our test for impairment performed in the fourth quarter of fiscal year 2010, goodwill and other intangible assets with indefinite useful lives were determined not to be impaired. We will continue to evaluate the need for impairment at least annually in the fourth quarter or in other fiscal quarters if changes in circumstances or available information indicate that impairment may have occurred.

        At October 1, 2010 and October 2, 2009, the carrying amount of property, plant and equipment and finite-lived intangible assets was $123.5 million and $130.1 million, respectively. In accordance with ASC 360 and ASC 350, we review the carrying values of long-lived assets and finite-lived intangible assets for impairment whenever events or changes in circumstances indicate that the carrying amount of any of these assets may not be recoverable. We assess the recoverability of property, plant and equipment to be held and used and finite-lived intangible assets by a comparison of the carrying amount of an asset or group of assets to the future net undiscounted cash flows expected to be generated by the asset or group of assets. If such assets are considered impaired, then the impairment recognized is measured as the amount by which the carrying amount of the assets exceeds the fair value of the assets. This process requires the use of cash flow models that utilize estimates of future revenue and expenses. There is inherent uncertainty in these estimates, and changes in these factors over time could result in an impairment charge.

        A prolonged general economic downturn and, specifically, a prolonged downturn in the defense, communications or medical markets, or technological changes, as well as other market factors, could intensify competitive pricing pressure, create an imbalance of industry supply and demand, or otherwise diminish volumes or profits. Such events, combined with changes in interest rates, could adversely affect our estimates of future net cash flows to be generated by our long-lived assets. Consequently, it is possible that our future operating results could be materially and adversely affected by any impairment charges related to the recoverability of our long-lived assets.

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        Malibu's Goodwill Impairment Analysis.    As mentioned above, the impairment analysis performed in the fourth quarter of fiscal year 2010 indicated no impairment existed as of July 2, 2010. The Malibu Division ("Malibu"), one of our reporting units, passed the goodwill impairment test with a fair value that exceeded its carrying value by approximately 7%. Goodwill allocated to Malibu as of July 2, 2010 was $15.9 million. We utilize a discounted cash flow approach in estimating the fair value of Malibu, where the discount reflects a weighted average cost of capital rate. The key assumptions driving the fair value of Malibu are principally future sales growth and the discount rate. Malibu's future sales growth assumptions were based on current product performance, customer input and long-term industry expectations. However, actual performance in the near and longer-term could be materially different from these expectations. This could be caused by events such as strategic decisions made in response to economic and competitive conditions, the impact of the economic environment on Malibu's customer base, or a material negative change in Malibu's relationships with its significant customers. If Malibu does not meet its projected sales growth, or its sales growth expectations are reduced in the future, then Malibu's goodwill could become impaired and a non-cash impairment charge to earnings would be recorded.

Accounting for stock-based compensation

        We account for stock-based compensation in accordance with FASB ASC 718, "Compensation—Stock Compensation." Under the fair value recognition provisions of this accounting standard, stock-based compensation cost is measured at the grant date based on the fair value of the award and is recognized as expense over the requisite service period, which is generally the vesting period.

        The fair value of each time-based option award is estimated on the date of grant using the Black-Scholes model. The fair value of each market performance-based (or combination of market performance- and time-based) option, restricted stock and restricted stock unit award is estimated on the date of grant using the Monte Carlo simulation technique in a risk-neutral framework. The Black-Scholes and the Monte Carlo simulation valuation models were developed for use in estimating the fair value of traded options that have no vesting restrictions and are fully transferable and require the input of subjective assumptions, including the expected stock price volatility and estimated option life. For purposes of these valuation models, no dividends have been assumed.

        The estimated fair value of our stock-based awards, less expected forfeitures, is amortized over the awards' vesting period on a straight-line basis. Since our common stock has not been publicly traded for a sufficient time period, the expected volatility is based on a blend of our expected volatility based on available historical data and the expected volatilities of similar companies that have a longer history of being publicly traded. The risk-free rates are based on the U.S. Treasury yield in effect at the time of the grant. Since our historical data is limited, the expected life of options granted is based on integrating historical data with the simplified method for plain vanilla options in accordance with ASC 718. The integration of historical data with the simplified method is done by using the actual life for options that have been settled, and a uniform distribution assumption for the options still outstanding. We will continue to use historical data with the simplified method until we have enough historical experience to provide a reasonable estimate of expected term. In fiscal years 2010, 2009 and 2008, we recognized $3.0 million, $2.7 million and $2.1 million, respectively, in stock-based compensation expense.

Income taxes

        We must make certain estimates and judgments in determining income tax expense for financial statement purposes. These estimates and judgments occur in the calculation of tax credits, tax benefits and deductions and in the calculation of certain tax assets and liabilities, which arise from differences in the timing of recognition of revenue and expense for tax and financial statement purposes.

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Significant changes to these estimates may result in an increase or decrease to our tax provision in a subsequent period.

        We must assess the likelihood that we will be able to recover our deferred tax assets. If recovery is not more likely than not, we must increase our provision for taxes by recording a valuation allowance against the deferred tax assets that we estimate will not ultimately be recoverable. We believe that all of the deferred tax assets recorded on our consolidated balance sheets will ultimately be recovered. However, should there be a change in our ability to recover our deferred tax assets, our tax provision would increase in the period in which we determined that the recovery was not more likely than not.

        In addition, the calculation of our tax liabilities involves dealing with uncertainties in the application of complex tax regulations. In accordance with FASB ASC 740, "Income Taxes," we recognize liabilities for uncertain tax positions based on the two-step process. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step requires us to estimate and measure the tax benefit as the largest amount that is more than 50% likely of being realized upon ultimate settlement. It is inherently difficult and subjective to estimate such amounts, as this requires us to determine the probability of various possible outcomes. We reevaluate these uncertain tax positions on a quarterly basis. This evaluation is based on factors including, but not limited to, changes in facts or circumstances, changes in tax law, effectively settled issues under audit and new audit activity. Such a change in recognition or measurement would result in the recognition of a tax benefit or an additional charge to the tax provision.

Interest Rate Risk

        Our exposure to market risk for changes in interest rates relates primarily to our long-term debt. As of December 31, 2010, on a pro forma basis, we would have had variable rate debt consisting of a $150.0 million term loan under the Senior Secured Credit Facilities. Our variable rate debt is subject to changes in the prime rate and the LIBOR rate.

        We use derivative instruments from time to time in order to manage interest costs and risk associated with our long-term debt. In September 2007, we entered into an interest rate swap contract in connection with our existing term loan. Under the provisions of FASB ASC 815, "Derivatives and Hedging," this arrangement was initially designated and qualified as an effective cash flow hedge of interest rate risk which permitted recording the fair value of the swap and corresponding unrealized gain or loss to accumulated other comprehensive (loss) income in the consolidated balance sheets. The interest rate swap gain or loss is included in the assessment of hedge effectiveness. At December 31, 2010, the fair value of the swap was a short-term liability of $0.5 million (accrued expenses). On February 2, 2011, we settled the swap and paid a related termination fee.

        We are currently evaluating the use of financial instruments to reduce our exposure to the effects of interest rate fluctuations on our floating rate debt after the Transactions. The impact of these financial instruments has not been taken into account in the change in the impact of changes in market rates provided above.

        We performed a sensitivity analysis to assess the potential loss in future earnings that a 10% increase in the variable portion of interest rates over a one-year period would have on the expected term loan under the Senior Secured Credit Facilities. The impact was determined based on the hypothetical change from the end of period market rates over a period of one year and would result in no change in future interest expense as a 10% increase in the current variable interest rate would not increase the rate above the "LIBOR floor" in the Senior Secured Credit Facilities.

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Foreign Currency Exchange Risk

        Although the majority of our revenue and expense activities are transacted in U.S. dollars, we do transact business in foreign countries. Our primary foreign currency cash flows are in Canada and several European countries. In an effort to reduce our foreign currency exposure to Canadian dollar denominated expenses, we enter into Canadian dollar forward contracts to hedge the Canadian dollar denominated costs for our manufacturing operation in Canada. Our Canadian dollar forward contracts are designated as a cash flow hedge and are considered highly effective, as defined by FASB ASC 815, "Derivatives and Hedging." The unrealized gains and losses from foreign exchange forward contracts are included in accumulated other comprehensive income in the condensed consolidated balance sheets. If the transaction being hedged fails to occur, or if a portion of any derivative is ineffective, then we promptly recognize the gain or loss on the associated financial instrument in general and administrative in the condensed consolidated statements of income. The gain recognized in general and administrative due to hedge ineffectiveness for fiscal year 2010 was $0.1 million. No ineffective amounts were recognized due to anticipated transactions failing to occur in fiscal years 2009 and 2008 nor in the first quarters of fiscal years 2010 and 2011.

        As of December 31, 2010, we had entered into Canadian dollar forward contracts for approximately $18.9 million (Canadian dollars), or approximately 53% of our estimated Canadian dollar denominated expenses for January 2011 through September 2011, at an average rate of approximately $0.96 U.S. dollar to Canadian dollar. We estimate the impact of a 1 cent change in the U.S. dollar to Canadian dollar exchange rate (without giving effect to our Canadian dollar forward contracts) to be approximately $0.3 million annually to our net income or approximately 2 cents annually to basic and diluted earnings per share.

        At December 31, 2010, the fair value of foreign currency forward contracts was a short-term asset of $0.7 million (prepaid and other current assets).

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BUSINESS

Business

Our Company

        We are a leading provider of microwave, RF, power and control products for critical applications in the defense, communications, medical and scientific industries. We develop, manufacture and distribute products used to generate, amplify, transmit and receive high-power/high-frequency microwave and RF signals and/or provide power and control for various defense and commercial applications. Our products are used for transmitting radar signals for threat tracking and navigation; transmitting decoy and jamming signals for electronic warfare; transmitting and amplifying voice, data and video signals for broadcasting, data links, the Internet, flight testing and other types of communications; providing power and control for medical diagnostic imaging; generating microwave energy for radiation therapy in the treatment of cancer; and for various industrial and scientific applications.

        We have an extensive portfolio of more than 4,500 products that includes a wide range of VEDs, satellite communications amplifiers, medical x-ray generators, advanced antenna technology, solid state devices, and various electronic power supply and control equipment. Products generally have selling prices ranging from $2,000 to $200,000, with certain limited products priced over $1,000,000.

        We estimate that our products are currently installed on more than 125 U.S. defense systems and more than 180 commercial systems. Both defense and commercial applications require the generation, control and transmission of high-power and high-frequency microwave and RF signals for which VED products are the most efficient technology. Our products are critical elements of high-priority U.S. and foreign military programs and platforms, including numerous airborne, ship-bourne and ground-based platforms. In addition to our strong presence in defense applications, we have successfully applied our key technologies to commercial end markets, including communications, medical, industrial and scientific applications, which provide us with a diversified base of sales. Revenues during fiscal year 2010 were split approximately evenly between defense and commercial applications.

        We believe that the majority of our VED products are consumable with an average life of between three and seven years, and once they are installed in original equipment, they generate recurring sales of spares and repairs. We regularly work with our customers, often utilizing customer-funded R&D programs to create and upgrade customized products with enhanced bandwidth, power and reliability. We estimate that approximately 36% of our total sales for fiscal year 2010 were generated from sales of spares and repairs, including upgraded replacements for existing products, providing us with a relatively stable business that is less vulnerable to dramatic shifts in market conditions. In addition, in fiscal 2010 we generated approximately 58% of our total sales from products for which we believe that we are the sole provider to our customers.

        We are organized into six divisions operating five manufacturing facilities in North America. We sell and service our products to customers globally through our internal sales, marketing and service force of approximately 145 professionals and 64 external sales organizations. Products are sold directly to the DoD, foreign military services and commercial customers, as well as to OEMs and systems integrators for ultimate sales to those customers. The U.S. Government is our only customer that accounted for more than 10% of our sales in fiscal year 2010.

        In fiscal year 2010 and Q1 2011, we generated total sales of $360.4 million and $89.0 million, respectively, net income of $6.7 million and $2.2 million, respectively, and Adjusted EBITDA of $61.6 million and $13.2 million, respectively. See note (6) under "Summary Historical and Pro Forma Financial Information" for additional information regarding Adjusted EBITDA.

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Our End Markets

        Approximately half of our product sales for fiscal year 2010 were for U.S. and foreign government and military end use. We are one of three companies in the United States that have the facilities and expertise to produce a broad range of high-power microwave products customized to the demanding specifications required for advanced military applications. Defense applications of our products include transmitting and receiving radar signals for locating and tracking threats, weapons guidance and navigation, as well as transmitting decoy and jamming signals for electronic warfare. Key defense platforms on which we provide mission-critical components include the Aegis Combat System; Phalanx and Hawk radar systems; ALE-50 airborne and MK-53 NULKA shipboard decoy systems; SIRFC on-board jamming system; and many of the U.S. military radar and electronic warfare systems in service. In recent years, we have expanded our focus in the communications market to include military communications applications, as we believe that there is a significant and growing market for our products for these applications. Military communications applications now make up a growing portion of our total communications business, and approximately one-third of our total communications sales in fiscal year 2010 were for military communications purposes. We believe satellite communication will be a critical element for supplying real time, high data-rate communications, intelligence and battlefield information to the front-line soldier. We currently provide satellite communication amplifiers for military platforms such as the WIN-T and NMT systems. In addition, military data link communications systems use our products to transmit and receive real-time command and control, intelligence, surveillance and reconnaissance data between airborne platforms (including UAVs) and their associated ground-based and ship-based terminals. We currently provide the data links for several major UAV platforms and the Apache attack helicopter.

        In addition to our strong presence in defense applications, we have successfully applied our key technologies to commercial end markets, including communications, medical, industrial and scientific applications, which provide us with a diversified base of sales. Within the commercial communications end market, we offer one of the industry's most comprehensive lines of satellite communications amplifiers, with offerings for virtually every currently applicable frequency and power requirement. We estimate that we have a worldwide installed base of more than 25,000 satcom amplifiers. Furthermore, we are participating in the growing area of Ka-band for commercial satcom applications including conventional and high-definition television for direct-to-home satellite broadcast as well as satellite communications for broadband data communications. Key programs are ViaSat's Ka-band satellite-delivered broadband services and DirecTV direct-to-home broadcast applications.

        Within the medical end market, we supply VEDs for high-end radiation therapy machines and x-ray generators. Radiotherapy treatment sales have grown in the last several years as major suppliers of therapy equipment have introduced a number of key technological advances that enable their equipment to treat a greater number of oncology-related problems. We believe this trend will drive continued growth in demand for our products. In addition, we believe that we are one of the leading independent suppliers of x-ray generators in the world, and we believe that this market provides long-term growth opportunities for us.

        The industrial market includes applications for a wide range of systems used for material processing, instrumentation and voltage generation, and we offer a number of specialized product lines to address this diverse market. We produce fully integrated amplifiers that include the associated high-power microwave devices used in instrumentation applications for electromagnetic interference and compatibility testing. Our products are also installed in the power supply modules of industrial equipment using RF energy to perform pipe and plastic welding, textile drying and semiconductor wafer fabrication. In addition, we have a line of industrial RF generators that use high-power microwave technology for various industrial heating and material processing applications.

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        Our scientific market consists primarily of equipment used in reactor fusion programs and accelerators for the study of high-energy particle physics, referred to as "Big Science." Generally, in scientific applications, our products are used to generate high levels of microwave or RF energy to accelerate a beam of electrons in order to study the atom and its elementary particles. Our products are also used in research related to the generation of electricity from fusion reactions.

Our Competitive Strengths

        We believe we are well positioned in our end markets and that our key competitive strengths are:

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Leadership in Microwave and RF Technology.  Since 1948, we have been a leader in microwave technology. More than 60 years ago, the founders of the Company pioneered a breakthrough technology that led to the commercialization of radar. Since then, we have improved our solutions, enabling technological advances in radar, electronic warfare and communications systems, which have required higher-power and higher-frequency solutions, and we have been designing and producing cutting-edge products that specifically address the evolving needs of our customers. In response to our customers' needs, we have designed and developed microwave systems that provide what we believe is a market-leading combination of power, frequency, bandwidth, control and reliability for our commercial and military customers. We have maintained our technological and production expertise through our experienced team of scientists and engineers, our recurring investment in research and development, over half of which is customer-funded, and our focus on continuous process improvement. Our leadership in design and quality is demonstrated by what we believe are sole-source relationships with customers from whom we generated a majority of our sales in fiscal year 2010.

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Leading Market Positions in Attractive End Markets.  We have developed leading market positions across the end markets we serve by offering customers superior design expertise, product quality and customer service. We believe we are a market leader in the sale of high-power, high-frequency microwave devices and related products for the defense, communications, medical, industrial and scientific end markets.

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Substantial Sole Provider Position.  Our market leading technology, customer focus, and long history as a reliable supplier to our government and commercial customers, have resulted in our products being designed into and installed on a large number of platforms and systems. We believe that in many cases we are the sole provider of high-power microwave equipment on these systems. In fiscal year 2010, we generated approximately 58% of our sales from products for which we believe we are the sole provider to our customers.

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Large Installed Product Base with Recurring Spares and Repairs Sales.  We provide products embedded within a large and growing installed base of defense systems and commercial systems. We estimate that our products are currently installed on more than 125 U.S. defense systems and more than 180 commercial systems. Furthermore, once our products have been designed and installed into a customer's system, high costs would have to be incurred by the customer in order to requalify a new supplier's component and redesign the customer's end product, which creates significant disincentives to switch to a competitor. This large installed base, high switching costs and our sole provider position enable us to capture a long-term stream of replacements, spares and repairs sales. We estimate that approximately 36% of our total sales for fiscal year 2010 were generated from recurring sales of replacements, spares and repairs.

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Diversified Sales Base.  Our sales are diversified by customer, by end market, by product and by geography. Our top 15 customers comprised less than 50% of total sales in fiscal year 2010, with only the U.S. Government accounting for more than 10% of our sales during such period. We sell our products to customers in five end markets: the radar and electronic warfare (defense), communications, medical, industrial and scientific markets. No end market represented more

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than 37% of total sales in fiscal year 2010. Within each of our markets, we also sell a variety of products. These products may be sold as stand-alone products or as part of a fully integrated subsystem. For example, we supply each U.S. Navy DDG-51 destroyer with many different products, ranging from coupled-cavity traveling wave tubes for the early warning radar system to power-grid replacement products and services. Our product diversification reduces our dependence on any one part of any market for our overall success and profitability. Finally, our leadership in our markets allows us to penetrate other important geographic markets, as evidenced by the fact that 36% of our total sales in fiscal year 2010 came from customers outside the United States. These international customers provide us with further diversification, as they span all of our end markets.

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Strong Cash Flow Generation and Low Capital Expenditures.  We generate substantial operating cash flow and have relatively low capital expenditures. For the three years ended October 1, 2010, our average annual net cash provided by continuing operating activities before cash interest expense, cash income tax and strategic alternative transaction expenses was $55.1 million, while average annual capital expenditures were $4.0 million. We expect capital expenditures to remain low as a percentage of total sales as we continue to actively manage our capital expenditure needs. For fiscal year 2010, capital expenditures equaled 1.2% of total sales.

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Strong and Experienced Management Team with a Successful Track Record.  Our management team averages more than 25 years experience with the Company and its predecessor, Varian Associates, Inc. Since assuming its leadership responsibilities in 2002, our management team has instilled a culture that places a heavy emphasis on cost consciousness, profitable growth, meeting goals and targets, and cash generation through efficient management of inventories, receivables, accounts payable and customer advances. In addition, management has consolidated several facilities, reduced labor costs, overhead and general and administrative expenses, and renewed the Company's commitment to operational excellence principles in its factories. During the tenure of our management team, our total sales increased from $251.2 million in fiscal year 2002 to $360.4 in fiscal year 2010, while our Adjusted EBITDA increased from $30.1 million in fiscal year 2002 to $61.6 million in fiscal year 2010.

Our Business Strategy

        Our goal is to continually improve our position as a leading supplier of products and systems into our core defense, medical, commercial and scientific markets. Our strategies to achieve this objective include:

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Expanding Our Business in the Emerging Military Communications Market.  We believe that real-time network communications between intelligence agencies, military commands and soldiers on the front lines will play an increasingly critical role in the U.S. military and that the procurement of new military communications systems will be a critical component of this trend. Microwave technology is well suited to provide the significant bandwidth required to enable the rapid and seamless transfer of large quantities of voice, video and other forms of information that are critical to military communications. We believe we are well positioned to continue to be a key supplier of microwave technology for the growing military satellite communications market, having made significant investments over the past several years to bring to market internally developed, proprietary microwave solutions tailored for military satellite communications use.

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Supporting Other Emerging Military Initiatives.  We believe the DoD is increasingly exploring high-power microwave solutions for a growing number of threat countermeasures and non-lethal weapons applications. We offer many products and are working with the military on new products for many of these applications, including next-generation electronic warfare systems

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that transmit decoy and jamming signals to deceive an enemy threat. In addition, the recent proliferation of non-traditional weapons has led to the exploration of technologies that can disable or destroy these devices. High-power microwave technology has shown a significant promise as a countermeasure against IEDs, and we expect that the DoD will actively pursue high-power technology solutions in this area.

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Developing and Expanding Technologies.  Through a combination of customer-funded research and development and our own internal research and development efforts, we intend to continue our focus on the development of our key technologies in core programs to increase market share and in adjacent, high-growth areas with significant long-term potential, including UAV technology, advanced radar applications, solid-state satcom amplifiers, next-generation x-ray machines and other complementary markets. We continue to analyze emerging technologies and aggressively pursue related market opportunities. For example, we have greatly increased our investment in solid- state technology for power amplifiers to address new mobile satcom applications. In addition, in the medical market we have recently introduced new x-ray generators with image processing systems to assist customers in their migration from film-based radiology systems to digital radiology systems. In fiscal year 2010, our total research and development spending was approximately $28.5 million, of which $12.4 million was internally funded and $16.1 million was customer-funded.

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Pursuing Attractive Commercial Opportunities.  We intend to develop new products to pursue growth areas in the commercial markets we serve. Recent examples of our product innovation include the introduction of a line of SuperLinear® high-powered, satellite communications amplifiers, which are more efficient, use less prime power and generate less heat, making them smaller and lighter and, therefore, better suited for modern, compact communications systems, as well as being more environmentally friendly, than comparable amplifiers. In addition, we provide high-powered Ka-band amplifiers for the growing area of commercial communications services via satellite, including the latest broadband (Internet) and HDTV applications. In the medical market, we have recently introduced new products, including x-ray generators with image processing systems as mentioned earlier.

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Leveraging Incumbent Relationships.  We intend to leverage our relationships with the U.S. Government, prime defense contractors and key commercial customers by continuing to deliver high levels of performance on our existing contracts, which will help to preserve our access to a valuable stream of spares and repairs business and enhance our ability to win new, upgrade and follow-on business.

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Exploring Strategic Acquisitions.  We intend to selectively explore strategic acquisitions in the rapidly consolidating defense and microwave components industries. Strategic acquisitions could permit us to acquire complementary technologies and products, achieve higher levels of system integration, grow our existing product base, and/or increase our geographic coverage by leveraging our extensive corporate sales and marketing organization.

Markets

        We develop, manufacture and distribute products used to generate, amplify, transmit and receive high-power/high-frequency microwave and RF signals and/or provide power and control for various applications in defense and commercial markets. We serve five end markets: the radar and electronic warfare (or defense), communications, medical, industrial and scientific markets. Certain of our products are sold in more than one end market depending on the specific power and frequency requirements of the application and the physical operating conditions of the end product. End-use applications of these systems include:

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the transmission of radar signals for navigation and location;

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the transmission of deception signals for electronic countermeasures;

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the transmission, reception and amplification of voice, data and video signals for broadcasting, data links, Internet, flight testing and other types of commercial and military communications;

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providing power and control for medical diagnostic imaging;

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generating microwave energy for radiation therapy in the treatment of cancer; and

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generating microwave energy for various industrial and scientific applications.

Our end markets are described below.

Radar and Electronic Warfare Market (Defense)

        We supply products used in various types of military radar systems, including search, fire control, tracking and weather radar systems. In radar systems, our products are used to generate or amplify electromagnetic energy pulses, which are transmitted via the radar system's antenna through the air until they strike a target. The return "echo" is read and analyzed by the receiving portion of the radar system, which then enables the user to locate and identify the target. Our products have been an integral element of radar systems for more than five decades.

        We supply microwave power amplifiers for electronic warfare programs. Electronic warfare systems provide protection for ships, aircraft and high-value land targets against radar-guided weapons by interfering with, deceiving or disabling the threats. Electronic warfare systems include onboard electronic equipment, pods that attach under aircraft wings and expendable decoys. Within an electronic warfare system, our components amplify low-level incoming signals received from enemy radar or enemy communications systems and amplify or modify those signals to enable the electronic warfare system either to jam or deceive the threat. We believe that we are a leading provider of microwave power sources for electronic warfare systems, having sold thousands of devices for those systems and having a sole provider position in products for certain high-power phased array systems and expendable decoys. Electronic warfare programs also include devices and subsystems being developed or supplied for high-power microwave applications, such as systems to disable and destroy IEDs and Active Denial (a system that uses microwave energy to deter unfriendly personnel). Many of the electronic warfare programs on which we are a qualified supplier are well-entrenched current programs for which we believe that there is ongoing demand.

        Our radar and electronic warfare products include microwave and power grid sources, microwave amplifiers, receiver protectors and multifunction integrated microwave assemblies, as well as complete transmitter subsystems consisting of the microwave amplifier, power supply and control system. Our product offering in the radar and electronic warfare market also includes advanced antenna systems for radar and radar simulators. Our products are used in airborne, UAVs, ground and shipboard radar systems. We believe that we are a leading provider of power grid and microwave power sources for government radar and electronic warfare applications, with an installed base of products on more than 125 systems and a sole provider position in numerous landmark programs.

        Our sales in the radar and electronic warfare market, which we also call our defense market, were $131.6 million, $135.9 million and $151.8 million in fiscal years 2010, 2009 and 2008, respectively, and $31.7 million and $28.2 million in Q1 2011 and our first quarter of fiscal year 2010 ("Q1 2010"), respectively. On average, approximately 56% of our sales in the radar and electronic warfare market are generated from recurring sales of replacements, spares and repairs, including upgraded replacements for existing products.

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Medical Market

        Within the medical market, we focus on diagnostic and treatment applications. For diagnostic applications, we provide products for medical imaging applications, such as x-ray imaging, magnetic resonance imaging ("MRI") and positron emission tomography ("PET"). For these applications, we provide x-ray generators, subsystems, software and user interfaces, including state-of-the-art, high-efficiency, compact power supplies and modern microprocessor-based controls and operator consoles for diagnostic imaging. We also provide power grid devices for PET Isotope production systems. These systems are linac-based proton accelerators used in the detection of cancer and other diseases.

        X-ray generators are used to generate and control the electrical energy being supplied to an x-ray VED and, therefore, control the dose of radiation delivered to the patient during an x-ray imaging procedure. In addition, these x-ray generators include a user interface to control the operation of the equipment, including exposure times and the selection of the anatomic region of the body to be examined. These generators are interfaced with, and often power and control, auxiliary devices, such as patient positioners, cameras and automatic exposure controls, to synchronize the x-ray examination with this other equipment.

        For treatment applications, we provide klystron VEDs and electron guns for high-end radiation therapy machines. Klystrons provide the microwave energy to accelerate a beam of energy toward a cancerous tumor.

        Sales in the medical market were $70.2 million, $61.2 million and $65.8 million in fiscal years 2010, 2009 and 2008, respectively, and $17.0 million and $19.4 million in Q1 2011 and Q1 2010, respectively.

        For many years, we have been the sole provider of klystron high-power microwave devices to Varian Medical Systems Inc.'s oncology systems division for use in its High Energy Clinac® radiation therapy machines for the treatment of cancer, and we expect this relationship to continue. We also provide x-ray generators for use on the On-Board Imager accessory for the Clinac and Trilogy™ medical linear accelerators. This automated system for image-guided radiation therapy uses high-resolution x-ray images to pinpoint tumor sites. Recently, we have also begun providing x-ray generators for use on the TrueBeam™ radiotherapy systems for the treatment of cancer. More than 5,900 of Varian Medical Systems' medical linear accelerators for cancer radiotherapy are in service around the world, delivering more than 30 million cancer treatments each year.

        The market for our x-ray generators and associated products is broad, ranging from dealers who buy only a few generators per year, up to large OEMs who buy hundreds per year. We sell our x-ray generators and associated equipment worldwide and have been growing both our geographic presence and our product portfolio. We have introduced new products, including x-ray generators with image processing systems, to assist customers in their migration from film-based radiology systems to digital radiology systems. We believe that we are one of the leading independent supplier of x-ray generators in the world, and we believe that this market provides continued long-term growth opportunities for us.

        We have traditionally focused on hospital, or "mid- to high-end," applications, and we believe that we have become a premier supplier to this part of the market. There also exists substantial demand for "lower-end" applications, and, in recent years, we have introduced families of products that allow us to participate more fully in this part of the market.

Communications Market

        In the communications market, we provide microwave and millimeter-wave amplifiers for commercial and military communications links for broadcast, video, voice and data transmission. Our sales in the communications market were $124.0 million, $106.4 million and $117.8 million in fiscal years 2010, 2009 and 2008, respectively, and $30.6 million and $28.7 million in Q1 2011 and Q1 2010,

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respectively. The communications market is the most dynamic of our end markets, and sales can vary significantly from quarter to quarter due, in part, to the timing and size of our shipments for specific programs during a particular quarter, including, for example, infrastructure programs for commercial direct-to-home or broadband satellite communications applications and military satellite communications programs. Historically, we have focused primarily on commercial communications applications, but in recent years, we have expanded our focus to include military communications applications, as we believe that there is a significant and growing market for our products for these applications. Military communications applications now make up a growing portion of our total communications business, and approximately one-third of our total communications sales in fiscal year 2010 were for military communications applications.

        Our commercial communications programs include satellite, terrestrial broadcast and over-the-horizon applications. Our military communications programs include satellite, data link and over-the-horizon communications applications. For satellite, terrestrial broadcast, data link and over-the-horizon communications applications, our products amplify and transmit signals within an overall communications system:

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Ground-based satellite communications transmission systems use our products to enable the transmission of microwave signals, carrying either analog or digital information, from a ground-based station to the transponders on an orbiting satellite by boosting the power of the low-level original signal to desired power levels for transmission over hundreds or thousands of miles to the satellite. The signal is received by the satellite transponder, converted to the downlink frequency and retransmitted to a ground-based receiving station.

        The majority of our communications products are sold into the satellite communications market. We estimate that we have a worldwide installed base of more than 27,000 amplifiers. We believe that we are a leading producer of power amplifiers, amplifier subsystems and high-power microwave devices for satellite uplinks, and that we offer one of the industry's most comprehensive lines of satellite communications amplifiers, with offerings for virtually every currently applicable frequency and power requirement for both fixed and mobile satellite communications applications in the military and commercial arena. We believe our technological expertise, our well-established worldwide service network and our ability to design and manufacture both the fully integrated amplifier and either the associated high-power microwave device or the solid-state RF device allow us to provide a superior overall service to our customers.

        We are participating in satellite communications growth areas, including: amplifiers for the 30 gigahertz (GHz) band (Ka-band), which is one of the major satellite communications growth areas for both commercial and military applications; the growing application worldwide of conventional and high-definition television for direct-to-home satellite broadcast; the use of satellite communications for broadband data communications; and specialized amplifiers for the military communications market.

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Terrestrial broadcast systems use our products to amplify and transmit signals, including television and radio signals at very high ("VHF") and ultra high ("UHF") frequencies, or other signals at a variety of frequencies. Through the years, we have established a customer base of several thousand customers in the broadcast market, providing us with opportunities for replacement, spares, upgrade and rebuilding business.

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Data link communications systems use our products to transmit and receive real-time command and control, intelligence, surveillance and reconnaissance ("ISR") data between airborne platforms, including UAVs and manned airborne platforms, and their associated ground-based and ship-based terminals via high-bandwidth digital data links. Our products are on the airborne and ground nodes of the tactical common data link ("TCDL") network for various platforms.

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Over-the-horizon (also referred to as "troposcatter") systems use our high-power amplifiers and traveling wave tubes to send a signal through the atmosphere, bouncing the signal off the troposphere, the lowest atmospheric layer, and enabling receipt of the signal tens of miles to hundreds of miles away. These systems transmit voice, video and data signals without requiring the use of a satellite, providing an easy-to-install, relocatable and cost-efficient alternative to satellite-based communications.

Industrial Market

        The industrial market includes applications for a wide range of systems used for material processing, instrumentation and voltage generation. We offer a number of specialized product lines to address this diverse market. We produce fully integrated amplifiers that include the associated high-power microwave devices used in instrumentation applications for electromagnetic interference and compatibility testing. Our products are also installed in the power supply modules of industrial equipment using RF energy to perform pipe and plastic welding, textile drying and semiconductor wafer fabrication. We have a line of industrial RF generators that use high-power microwave technology for various industrial heating and material processing applications. Our sales in the industrial market were $23.6 million, $20.2 million and $25.1 million in fiscal years 2010, 2009 and 2008, respectively, and $5.4 million and $5.2 million in Q1 2011 and Q1 2010, respectively.

Scientific Market

        The scientific market consists primarily of equipment used in reactor fusion programs and accelerators for the study of high-energy particle physics, referred to as "Big Science." Generally, in scientific applications, our products are used to generate high levels of microwave or RF energy to accelerate a beam of electrons in order to study the atom and its elementary particles. Our products are also used in research related to the generation of electricity from fusion reactions. Our sales in the scientific market were $11.0 million, $9.2 million and $9.5 million in fiscal years 2010, 2009 and 2008, respectively, and $4.3 million and $1.3 million in Q1 2011 and Q1 2010, respectively.

Geographic Markets

        We sell our products in approximately 90 countries. In fiscal year 2010, sales to customers in the U.S., Europe and Asia accounted for approximately 64%, 16% and 16% of our total sales, respectively. No country other than the U.S. accounted for more than 10% of our sales in fiscal year 2010. See "Sales, Marketing and Service." For financial information about geographic areas, see Note 13 to the accompanying audited consolidated financial statements, included elsewhere in this prospectus.

Products

        We have an extensive portfolio of over 4,500 products that includes a wide range of microwave and power grid VEDs, in addition to products such as:

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satellite communications amplifier subsystems;

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radar and electronic warfare subsystems;

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specialized antenna subsystems;

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solid-state integrated microwave assemblies;

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medical x-ray generators and control systems;

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modulators and transmitters; and

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various electronic power supply and control equipment and devices.

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        Additionally, we have developed complementary, more highly integrated, subsystems that contain additional integrated components for medical imaging and for satellite communications applications. These integrated subsystems generally sell for higher prices.

        Generally, our products are used to:

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generate or amplify (multiply) various forms of electromagnetic energy (these products are generally referred to as VEDs, vacuum electron devices, or simply as devices);

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transmit, direct, measure and control electromagnetic energy;

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provide the voltages and currents to power and control devices that generate electromagnetic energy; or

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provide some combination of the above functions.

        VEDs were initially developed for defense applications but have since been applied to many commercial markets. We use tailored variations of this key technology to address the different frequency and power requirements in each of our target markets. Generally our VED products derive from, or are enhancements to, the original VED technology on which our company was founded. Most of our other products were natural offshoots of the original VED technology and were developed in response to the opportunities and requirements in the market for more fully integrated products and services. The type of device selected for a specific application is based on the operating parameters required by the system. Our products generally have selling prices ranging from $2,000 to $200,000, with certain, limited products priced up to $1,000,000.

        We sell several categories of VEDs, including:

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Klystrons and gyrotrons: Klystrons are typically high-power VEDs that operate over a narrow range of frequencies, with power output ranges from hundreds of watts to megawatts and frequencies from 500 kilohertz (KHz) to over 30 GHz. We produce and manufacture klystrons for a variety of radar, communications, medical, industrial and scientific applications. Gyrotron oscillators and amplifiers operate at very high power and very high frequencies. Power output of one megawatt has been achieved at frequencies greater than 100 GHz. These devices are used in areas such as fusion research, electronic warfare and high-resolution radar.

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Helix traveling wave tubes: Helix traveling wave tubes are VEDs that operate over a wide range of frequencies at moderate output power levels (tens of watts to thousands of watts). These devices are ideal for terrestrial and satellite communications and electronic warfare applications.

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Coupled cavity traveling wave tubes: Coupled cavity traveling wave tubes are VEDs that combine some of the power generating capability of a klystron with some of the increased bandwidth (wider frequency range) properties of a helix traveling wave tube. These amplifiers are medium bandwidth, high-power devices, with power output levels that can be as high as one megawatt. These devices are used primarily for high-power and multi-function radars, including frontline radar systems.

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Magnetrons: Magnetron oscillators are VEDs capable of generating high-power output at relatively low cost. Magnetrons generate power levels as high as 20 megawatts and cover frequencies up to the 40 GHz range. We design and manufacture magnetrons for radar, electronic warfare and missile programs within the defense market. Shipboard platforms include search and air traffic control radar on most aircraft carriers, cruisers and destroyers of NATO-country naval fleets. Ground-based installations include various military and civil search and air traffic control radar systems. We are also a supplier of magnetrons for use in commercial weather radar. Potential new uses for magnetrons include high-power microwave systems for

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disruption of enemy electronic equipment and the disabling or destruction of roadside bombs and other IEDs.

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Cross-field amplifiers: Cross-field amplifiers are VEDs used for high-power radar applications because they have power output capability as high as 10 megawatts. Our cross-field amplifiers are primarily used to support radar systems on the Aegis weapons used by the U.S. Navy and select foreign naval vessels. We supply units both for new ships and for replacements.

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Power grid devices: Power grid devices are lower frequency VEDs that are used to generate, amplify and control electromagnetic energy. These devices are used in commercial and military communications systems and radio and television broadcasting. We also supply power grid devices for the shortwave broadcast market and for MRI and PET applications for the medical market. Our products are also widely used in equipment that serves the industrial markets such as textile drying, pipe welding and semiconductor wafer fabrication.

        In addition to VEDs, we also sell:

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Microwave transmitter subsystems: Our microwave transmitter subsystems are integrated assemblies generally built around our VED products. These subsystems incorporate specialized high-voltage power supplies to power the VED, plus cooling and control systems that are uniquely designed to work in conjunction with our devices to maximize life, performance and reliability. Microwave transmitter subsystems are used in a variety of defense and commercial applications. Our transmitter subsystems are available at frequencies ranging from one GHz all the way up to 100 GHz and beyond.

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Satellite communications amplifiers: Satellite communications amplifiers provide integrated power amplification for the transmission of voice, broadcast, data, Internet and other communications signals from ground stations to satellites in all frequency bands. We provide a broad line of complete, integrated satellite communications amplifiers that consist of a VED or solid- state microwave amplifier, a power supply to power the device, radio frequency conditioning circuitry, cooling equipment, electronics to control the amplifier and enable it to interface with the satellite ground station, and a cabinet. These amplifiers are often combined in sub-system configurations with other components to meet specific customer requirements. We offer amplifiers both for defense and for commercial applications. Our products include amplifiers based on helix and coupled cavity traveling wave tubes, klystrons, solid-state devices and millimeter-wave devices.

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Receiver protectors and control components: Receiver protectors are used in the defense market in radar systems to protect sensitive receivers from extraneous high-power signals, thereby preventing damage to the receiver. We have been designing and manufacturing receiver protector products for more than 50 years and offer a wide range of available technologies, as well as a wide range of other components used to control the RF energy in the customer's system. Our receiver protectors and control components are integrated into prominent fielded military programs. As radar systems have evolved to improve performance and reduce size and weight, we have invested in solid-state technology to develop the microwave control components to allow us to offer more fully integrated products, referred to as multifunction assemblies, as required by modern radar systems.

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Medical x-ray imaging systems: We design and manufacture x-ray generators for medical imaging applications. These consist of power supplies, cooling, control and display subsystems that drive the x-ray equipment used by healthcare providers for medical imaging. The energy in an x-ray imaging system is generated by an x-ray tube which is another version of a VED operating in a different region of the electromagnetic spectrum. These generators use the high-voltage and control systems expertise originally developed by us while designing power systems to drive our

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other VEDs. We also provide the electronics and software subsystems that control and tie together much of the other ancillary equipment in a typical x-ray imaging system. We have recently introduced x-ray generators with imaging processing systems to assist our customers in their migration from film-based radiology systems to digital radiology systems.

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Antenna systems: We design and manufacture antenna systems for a variety of applications, including, radar, electronic warfare, communications and telemetry. Along with a variety of antenna types, including phased array, edge and tilt scanning antennas, conformal electronic scanning antennas, stabilized shipboard tracking antennas and our trademark FLAPS ("Flat Parabolic Surface") antennas, the antenna systems also include the highly efficient harmonic drive pedestals used to support them. The antenna systems used on airborne, shipboard and ground-based platforms are designed to enable high performance, high data rate transmission at frequencies ranging from one GHz to 100GHz.

Backlog

        As of December 31, 2010, we had an order backlog of $252.4 million compared to an order backlog of $236.6 million as of January 1, 2010. We had an order backlog of $241.9 million as of October 1, 2010 compared to an order backlog of $226.0 million as of October 2, 2009. Backlog represents the cumulative balance, at a given point in time, of recorded customer sales orders that have not yet been shipped or recognized as sales. Backlog is increased when an order is received, and backlog is reduced when we recognize sales. We believe that backlog and orders information is helpful to investors because this information may be indicative of future sales results. Although backlog consists of firm orders for which goods and services are yet to be provided, customers can, and sometimes do, terminate or modify these orders. Historically, however, the amount of modifications and terminations has not been material compared to total contract volume. Approximately 85% of our backlog as of October 1, 2010 is expected to be filled within fiscal year 2011.

Sales, Marketing And Service

        Our global distribution system provides us with the capability to introduce, sell and service our products worldwide. Our distribution system primarily uses our direct sales professionals throughout the world. We have direct sales offices throughout North America and Europe, as well as in India, Singapore, China and Australia. As of October 1, 2010, we had 145 direct sales, marketing and technical support individuals on staff. Our wide-ranging distribution capabilities enable us to serve our growing international markets, which accounted for approximately 36% of our sales in fiscal year 2010.

        Our sales professionals receive extensive technical training and focus exclusively on our products. As a result, they are able to provide knowledgeable assistance to our customers regarding product applications and the introduction and implementation of new technology, and, at the same time, provide local technical support.

        In addition to our direct sales force, we use approximately 64 external sales organizations and one significant stocking distributor, Richardson Electronics, Ltd., to service the needs of customers in certain markets. The majority of the third-party sales organizations that we use are located outside the U.S. and Europe and focus primarily on customers in South America, Southeast Asia, the Middle East, Africa and Eastern Europe. Through the use of third-party sales organizations, we are better able to meet the needs of our foreign customers by establishing a local presence in lower volume markets. Using both our direct sales force and our largest distributor, Richardson Electronics, we are able to market our products to both end users and system integrators around the world and to deliver our products with short turn-around times.

        Given the complexity of our products, their critical function in customers' systems and the unacceptably high costs to our customers of system failure and downtime, we believe that our

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customers view our product breadth, reliability and superior responsive service as key points of differentiation. We offer comprehensive customer support, with direct technical support provided by 21 strategically located service centers, primarily serving satellite communications customers. These service centers are located in the U.S. (California and Massachusetts), Canada (Georgetown, Ontario), Brazil, China (five), India (two), Japan, Korea, Peru, Russia, Singapore, South Africa, Australia, Taiwan (two) and The Netherlands. The service centers enable us to provide extensive technical support and rapid response to customers' critical spare parts and service requirements throughout the world. In addition, we offer on-site installation assistance, on-site service contracts, a 24-hour technical support hotline and complete product training at our facilities, our service centers or customer sites. We believe that many of our customers specify our products in competitive bids due to our responsive global support and product quality.

Competition

        The industries and markets in which we operate are competitive. We encounter competition in most of our business areas from numerous other companies, including units of L-3 Communications Corporation, Thales Electron Devices SA, e2v technologies plc, Teledyne Technologies, Inc. and Comtech Xicom Technology, Inc., a subsidiary of Comtech Telecommunications Corporation ("Comtech"). Some of our competitors have parent entities that have resources substantially greater than ours. In certain markets, some of these competitors are also our customers and/or our suppliers, particularly for products for satellite communications applications. Our ability to compete in our markets depends to a significant extent on our ability to provide high-quality products with shorter lead times at competitive prices and our readiness in facilities, equipment and personnel.

        We also continually engage in research and development efforts in order to introduce innovative new products for technologically sophisticated customers and markets. There is an inherent risk that advances in existing technology, or the development of new technology, could adversely affect our market position and financial condition. We provide both VED and solid-state alternatives to our customers, and invest in research and development efforts across a wide range of power and frequency levels in both VED and solid-state technologies. We believe that for the foreseeable future, solid-state devices are well suited for specific lower-power applications but will be unable to compete on a cost-effective basis in the high-power/high-frequency markets that represent the majority of our business. We believe that VED and solid-state technologies currently serve their own specialized markets without significant overlap in most applications. See "Risk Factors—Risks relating to our business—We face competition in the markets in which we sell our products."

Research And Development

        Total research and development spending was $28.5 million, $28.0 million and $22.8 million during fiscal years 2010, 2009 and 2008, respectively, and $6.8 million and $6.3 million in Q1 2011 and Q1 2010, respectively. Total research and development spending consisted of company-sponsored research and development expense of $12.4 million, $10.5 million and $10.8 million during fiscal years 2010, 2009 and 2008, respectively, and customer-sponsored research and development of $16.1 million, $17.5 million and $12.0 million during fiscal years 2010, 2009 and 2008, respectively. Total research and development spending consisted of company-sponsored research and development expense of $3.1 million and $2.6 million during Q1 2011 and Q1 2010, respectively, and customer-sponsored research and development of $3.7 million and $3.7 million during Q1 2011 and Q1 2010, respectively. Customer-sponsored research and development costs are charged to cost of sales to correspond with revenue recognized.

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Manufacturing

        We manufacture our products at six manufacturing facilities in five locations in North America. We have implemented modern manufacturing methodologies based upon a continuous improvement philosophy, including just-in-time materials handling, demand flow technology, statistical process control and value-managed relationships with suppliers and customers. We obtain certain materials necessary for the manufacture of our products, such as molybdenum, cupronickel, oxygen-free high conductivity ("OFHC") copper and some cathodes, from a limited group of, or occasionally sole, suppliers. Five of our facilities have achieved the ISO 9001 international certification standard.

        Generally, each of our manufacturing divisions uses similar manufacturing processes consisting of product development, procurement of components and/or sub-assemblies, high-level assembly and testing. For satellite communications equipment, the process is primarily one of integration, and we use contract manufacturers to provide sub-assemblies whenever possible. Satellite communications equipment uses both VED and solid-state technology, and the Satcom Division procures certain of the critical components that it incorporates into its subsystems from our other manufacturing divisions.

Intellectual Property

        Our business is dependent, in part, on our intellectual property rights, including trade secrets, patents and trademarks. We rely on a combination of nondisclosure and other contractual arrangements as well as trade secret, patent, trademark and copyright laws to protect our intellectual property rights. We do not believe that any single patent or other intellectual property right or license is material to our success as a whole.

        On occasion, we have entered into agreements pursuant to which we license intellectual property from third parties for use in our business, and we also license intellectual property to third parties. As a result of contracts with the U.S. Government, some of which contain patent and/or data rights clauses, the U.S. Government has acquired royalty-free licenses or other rights in inventions and technology resulting from certain work done by us on behalf of the U.S. Government. See "Risk Factors—Risks relating to our business—We have only a limited ability to protect our intellectual property rights, which are important to our success."

U.S. Government Contracts And Regulations

        We deal with numerous U.S. Government agencies and entities, including the Department of Defense, and, accordingly, we must comply with and are affected by laws and regulations relating to the formation, administration and performance of U.S. Government contracts. We are affected by government, regulatory and industry approvals/oversight. We are affected by similar government authorities and approvals/oversight with respect to our international business.

        U.S. Government contracts are conditioned upon the continuing availability of Congressional appropriations. Congress usually appropriates funds on a fiscal-year basis even though contract performance may extend over many years. Therefore, long-term government contracts and related orders are subject to cancellation if appropriations for subsequent performance periods are not approved. See "Risk Factors—Risks relating to our business—A significant portion of our sales is, and is expected to continue to be, from contracts with the U.S. Government, and any significant reduction in the U.S. defense budget or any disruption or decline in U.S. Government expenditures could negatively affect our results of operations and cash flows."

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        In addition, our U.S. Government contracts may span one or more base years and multiple option years. The U.S. Government generally has the right not to exercise option periods and may not exercise an option period if the applicable U.S. Government agency does not receive funding or is not satisfied with our performance of the contract. All of our government contracts and most of our government subcontracts can be terminated by the U.S. Government, or another relevant government, either for its convenience or if we default by failing to perform under the contract. Upon termination for convenience of a fixed-price contract, we normally are entitled to receive the purchase price for delivered items, reimbursement for allowable costs for work-in-process and an allowance for profit on the work performed. Upon termination for convenience of a cost-reimbursement contract, we normally are entitled to reimbursement of allowable costs plus a portion of the fee. The amount of the fee recovered, if any, is related to the portion of the work accomplished prior to termination. See "Risk Factors—Risks relating to our business—We are subject to risks particular to companies supplying defense-related equipment and services to the U.S. Government. The realization of any of these risks could cause a loss of or decline in our sales to the U.S. Government."

        Licenses or other authorizations are required from U.S. Government agencies for the export of many of our products in accordance with various regulations, including the United States Export Administration Regulations (for commercial products, including "dual use" products with military applications) and the International Traffic in Arms Regulations (for defense articles and defense services). In addition, regulations administered by OFAC of the U.S. Department of the Treasury govern transactions with countries and persons subject to U.S. trade sanctions, including import as well as export transactions. We are also subject to U.S. Government restrictions on transactions with specific entities and individuals, including, without limitation, those set forth on the Entity List, the Specially Designated Nationals List, the Denied Persons List, the Unverified List, and the U.S. State Department's lists of debarred parties. We are also subject to U.S. customs laws and regulations, including customs duties, when applicable. Additionally, we are subject to the Anti-Boycott Regulations administered by the U.S. Department of Commerce and the Boycott Provisions of the Internal Revenue Code (Section 999) administered by the Internal Revenue Service.

        Our internal compliance program has identified, and we have made voluntary self-disclosures regarding potential compliance issues to (i) OFAC regarding assistance provided by the Swiss branch office of one of our U.S. subsidiaries (the "Swiss Branch") with respect to sales of medical x-ray equipment by our Canadian subsidiary to distributors for resale to end-users in Iran; (ii) to OFAC and BIS regarding the repair of a U.S.-origin power supply for a customer in Syria and the re-export to Syria of a U.S.-origin part that was used in such repair, by the Netherlands branch office of one of our European subsidiaries; and (iii) OAC regarding the acceptance by the Swiss Branch of purchase orders that contained boycott language with respect to sales of power tetrodes to Saudi Arabia. Each of Iran and Syria is a country that is subject to U.S. trade sanctions. While it is not possible to predict the response of the U.S. authorities, the Company could be assessed substantial fines or other penalties as a result of these matters.

        In addition to U.S. laws and regulations, foreign countries may also have laws and regulations governing imports and exports. See "Risk Factors—Risks Relating to our Business—Laws and regulations governing the export of our products could adversely impact our business."

Legal Proceedings

        On July 1, 2010, a putative stockholder class action complaint was filed against Predecessor, the members of the Predecessor's board of directors, and Comtech in the California Superior Court for the County of Santa Clara, entitled Continuum Capital v. Michael Targoff, et al. (Case No. 110CV175940). The lawsuit concerned the proposed merger between us and Comtech, and generally asserted claims alleging, among other things, that each member of Predecessor's board of directors breached his fiduciary duties by agreeing to the terms of the previously proposed merger and by failing to provide

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stockholders with allegedly material information related to the proposed merger, and that Comtech aided and abetted the breaches of fiduciary duty allegedly committed by the members of our board of directors. The lawsuit sought, among other things, class action certification and monetary relief. On July 28, 2010, the plaintiff filed an amended complaint, making generally the same claims against the same defendants, and seeking the same relief. In addition, the amended complaint generally alleged that the consideration that would have been paid to Predecessor's stockholders under the terms of the proposed merger was inadequate. On September 7, 2010, Predecessor terminated the Comtech sale agreement. On November 24, 2010, Predecessor entered in an agreement and plan of merger with CPII and Merger Sub, which are affiliates of the Veritas Fund. On December 15, 2010, the plaintiff filed a second amended complaint, which removed Comtech as a defendant, added allegations related to the Merger and to Veritas Capital, and added a claim for attorneys' fees. On December 23, 2010, after Predecessor filed its preliminary proxy statement relating to a special meeting in connection with the approval of the Merger, the plaintiff filed a third amended complaint, adding allegations related to the disclosures in the preliminary proxy statement. The third amended complaint seeks, among other things, class action certification and monetary relief.

        We believe the action is without merit; however, to avoid the cost and uncertainty of litigation and to complete the proposed Transactions without delay, the defendants have entered into a Memorandum of Understanding concerning settlement. The settlement and any attorneys' fees award are subject to Court approval. Pursuant to the Memorandum of Understanding, among other things, the defendants will receive a release of claims and the plaintiff will dismiss the third amended complaint with prejudice in exchange for, among other agreements, an agreement by Predecessor to make certain additional disclosures concerning the Merger, which disclosures were included in a definitive proxy statement filed by Predecessor on January 11, 2011. The Memorandum of Understanding also provides that, upon Court approval and dismissal of the action, Predecessor, its insurers or its successor in interest will cause to be paid to the plaintiff's counsel $575,000 in full settlement of any claim for attorneys' fees and all expenses. CPII expects the majority of this payment to be borne by its insurers.

        During fiscal year 2009, we received a notice from a customer purporting to terminate a sales contract due to alleged nonperformance. In April and June 2010, we received notices from the customer claiming additional cost incurred due to the alleged nonperformance. The customer has initiated arbitration and filed a claim for damages of approximately $2.1 million. We have filed a counterclaim for damages of approximately $0.8 million. We plan to contest this matter vigorously. At this time, we believe that any loss or gain with respect to this matter will not have a material effect on our consolidated results of operations and cash flows.

Environmental Matters

        We are subject to a variety of U.S. federal, state and local, as well as foreign, environmental laws and regulations relating to, among other things, wastewater discharge, air emissions, storage and handling of hazardous materials, disposal of hazardous and other wastes and remediation of soil and groundwater contamination. We use a number of chemicals or similar substances and generate wastes that are classified as hazardous, and we require environmental permits to conduct certain of our operations. Violation of such laws and regulations can result in fines, penalties and other sanctions.

        We were formerly the electron device business of Varian Associates, Inc. In connection with the sale of that business to us in 1995, Varian Medical Systems, Inc. (as successor to Varian Associates, Inc.) generally agreed to indemnify us for various environmental liabilities relating to Varian Associates' electron devices business prior to August 1995. We are generally not indemnified by Varian Medical Systems with respect to liabilities resulting from our operations after August 1995. Pursuant to this agreement, Varian Medical Systems is undertaking environmental investigation and remedial work at our manufacturing facilities in Palo Alto, California and Beverly, Massachusetts, that are known to require remediation.

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        To date, Varian Medical Systems has, generally at its expense, conducted required investigation and remediation work at its former facilities and responded to environmental claims arising from Varian Medical Systems' (or its predecessor's) prior operations of the electron device business.

        In connection with our sale of the former Varian facility located in San Carlos, California in September 2006, the buyer of the facility obtained insurance to cover the expected environmental remediation costs and other potential environmental liabilities at that facility. In addition, in connection with the sale, we released Varian Medical Systems from certain of its indemnification obligations with respect to that facility. If the proceeds of the environmental insurance are insufficient to cover the required remediation costs and potential other environmental liabilities at that facility, we could be required to bear a portion of those liabilities.

        We believe that we have been and are in substantial compliance with applicable environmental laws and regulations, and we do not expect to incur material costs relating to environmental compliance. However, new or changes in enforcement of existing environmental requirements, or discovery of previously unknown conditions, could result in additional costs that may be significant.

Employees

        As of December 31, 2010, we had approximately 1,580 employees, of which 460 are located outside the United States (including approximately 430 in Canada). None of our employees is subject to a collective bargaining agreement, although a limited number of our sales force members located in Europe are members of work councils or unions. We have not experienced any work stoppages, and we believe that we have good relations with our employees.

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MANAGEMENT

Management

        The following table sets forth certain information regarding the board of directors of CPII, the board of directors of Parent and our named executive officers. The age of each individual in the table below is as of March 1, 2011.

Name	Age	Office and Position
O. Joe Caldarelli	60	Chief Executive Officer and Director
Robert A. Fickett	50	President, Chief Operating Officer and Director
Joel A. Littman	58	Chief Financial Officer, Treasurer and Secretary
John R. Beighley	58	Vice President and Assistant Secretary of CPII
Don C. Coleman	56	Vice President of CPII
Andrew E. Tafler	55	Vice President of CPII
Robert B. McKeon	56	Chairman of our boards of directors, Director
Hugh Evans	42	Director
Ramzi M. Musallam	42	Director
Jeffrey P. Kelly	36	Director

O. Joe Caldarelli serves as our Chief Executive Officer and a member of our boards of directors. Mr. Caldarelli became Chief Executive Officer and a Director of CPII in March 2002. Prior to this, Mr. Caldarelli was a Co-Chief Operating Officer of CPII since October 2000 and Vice President of CPII since August 1995. Mr. Caldarelli is also the Division President of CPII's Communications & Medical Products Division. Mr. Caldarelli was Vice President and General Manager for the Communications & Medical Products Division under the Electron Device Business of Varian Associates, Inc. from 1985 until August 1995 and was President and a Director of Varian Canada, Inc. from 1992 until August 1995. From 1982 until 1985, Mr. Caldarelli was Marketing Manager of the Communications & Medical Products Division of Varian Associates, Inc. and served as its Equipment Operations Manager from 1979 until 1982. Prior to joining Varian Associates, Mr. Caldarelli served as Manufacturing Engineering Manager for Medtronic Canada, Inc. Mr. Caldarelli holds a B.S. degree in mechanical engineering from the University of Toronto. Mr. Caldarelli was chosen to serve on our boards of directors because of his extensive industry and CPII experience, his experience in multiple senior management roles, and his prior exposure to mergers and acquisitions and refinancing transactions.

Robert A. Fickett serves as our President, Chief Operating Officer and a member of our boards of directors. Mr. Fickett became President and Chief Operating Officer of CPII in March 2002. Prior to this, Mr. Fickett was a Co-Chief Operating Officer of CPII since October 2000 and Vice President of CPII since April 1998. Mr. Fickett has also been the Division President of CPII's Microwave Power Products Division since April 1998. From January 1996 to April 1998, Mr. Fickett was Vice President of Operations for CPII's Microwave Power Products Division. From 1993 until January 1996, he was President and Chief Executive Officer of Altair Technologies, Inc., a contract manufacturer. From 1982 until 1993, Mr. Fickett held a number of positions with Varian Associates, Inc., including Engineering Manager of the Microwave Power Products Division's Klystron Engineering Group, to which he was promoted in 1989. Mr. Fickett received a B.S. degree in mechanical engineering from the University of California, Berkeley. Mr. Fickett was chosen to serve on our boards of directors because of his extensive industry and CPII experience, his experience in multiple senior management roles, and his experience in engineering and operations.

Joel A. Littman serves as our Chief Financial Officer. Mr. Littman became Chief Financial Officer of CPII in September 2001. Mr. Littman was Corporate Controller for CPII from November 1996 to

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September 2001. From September 1989 to November 1996, Mr. Littman served as Controller of the Microwave Power Products Division of Varian Associates, Inc. and CPII. Prior to that, Mr. Littman held various finance positions with Varian Associates, Inc. and TRW Inc. Mr. Littman received a B.A. degree in economics and an M.B.A. degree, both from the University of California at Los Angeles.

John R. Beighley serves as one of CPII's Vice Presidents. Mr. Beighley became a Vice President of CPII in March 1997. Mr. Beighley currently heads CPII's worldwide field sales organization. From May 1992 to March 1997, Mr. Beighley was CPII's Western Hemisphere Sales Manager responsible for sales in the Americas, the Far East and Australia. From June 1989 to May 1992, Mr. Beighley was CPII's North American Sales Manager. From March 1981 to June 1989, Mr. Beighley held a number of product marketing and field sales positions with Varian Associates, Inc. Mr. Beighley received a B.S. degree in marketing from San Francisco State University and an M.B.A. degree from Santa Clara University.

Don C. Coleman serves as one of CPII's Vice Presidents. Mr. Coleman became a Vice President and Division President of CPII's Beverly Microwave Division in February 1999. Mr. Coleman was Vice President of Manufacturing for CPII's Beverly Microwave Division from February 1996 until accepting his current position. From 1990 until 1996, Mr. Coleman held the position of Engineering Manager for Receiver Protector Products at the Company's Beverly Microwave Division. Prior to 1990, Mr. Coleman held a variety of manufacturing and development engineering positions at Varian Associates, Inc. Mr. Coleman received a B.S. degree in engineering from the University of Massachusetts.

Andrew E. Tafler serves as one of CPII's Vice Presidents. Mr. Tafler became a Vice President of CPII in December 2005. Mr. Tafler became Division President of CPII's Satcom Division in May 2004. Mr. Tafler was previously Vice President of Operations for the Satcom Division from 2000 to 2004. From 1989 to 2000, Mr. Tafler held the Business Development Manager and then the Operations Manager positions at the Communications & Medical Products Division of the Electron Device Group of Varian Associates, Inc. Mr. Tafler held a number of manufacturing and marketing positions at Varian Associates from 1984 to 1989. Prior to joining Varian Associates, Mr. Tafler served in engineering and management positions with Bell Canada Inc. Mr. Tafler holds a B.A.Sc. degree in electrical engineering from the University of Toronto.

Robert B. McKeon serves as the Chairman of our boards of directors. Mr. McKeon is the Founder, Chairman, and Managing Partner of Veritas Capital, a New York-based private equity investment firm he formed in 1992. Prior to forming Veritas in 1992, Mr. McKeon served as the Chairman of Wasserstein Perella Management Partners and was a founding partner of Wasserstein Perella & Co. in 1988. Mr. McKeon currently serves as Chairman of the Board of Vangent, Inc., and Global Tel*Link Corporation, and he served as the Chairman of the Board of DynCorp International Inc. from March 2005 to July 2010. Mr. McKeon is a member of the Council on Foreign Relations, The Bretton Woods Committee, and the Center for Strategic & International Studies. Mr. McKeon holds a B.S. from Fordham University and an M.B.A. from Harvard Business School. Mr. McKeon was chosen to serve on our boards of directors because of his position as Founder, Chairman, and Managing Partner of Veritas Capital, his experience on other public and private company boards and his extensive experience in finance and private equity investment.

Hugh Evans serves as a member of our boards of directors. Mr. Evans is a Partner at Veritas Capital. Prior to joining Veritas in 2005, Mr. Evans was a Partner at Falconhead Capital, a middle market private equity firm. While at Falconhead, Mr. Evans was a member of the firm's investment committee. Prior to Falconhead, Mr. Evans was a Principal at Stonington Partners. Mr. Evans began his private equity career in 1992 at Merrill Lynch Capital Partners, the predecessor firm of Stonington, which was a wholly owned subsidiary of Merrill Lynch. Mr. Evans holds an A.B. from Harvard University and an M.B.A. from the University of Chicago Graduate School of Business. Mr. Evans was chosen to serve on our boards of directors because of his position as a Partner of Veritas Capital, his

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experience on other public and private company boards and his extensive experience in finance and private equity investment.

Ramzi M. Musallam serves as a member of our boards of directors. Mr. Musallam is a Partner at Veritas Capital, which he has been associated with since 1997. He is a member of the boards of directors of Vangent, Inc., and several private companies and was a member of the board of directors of DynCorp International Inc. from February 2005 to July 2010. Mr. Musallam holds a B.A. from Colgate University with a major in Economics and Mathematics and an M.B.A. from the University of Chicago Booth School of Business. Mr. Musallam was chosen to serve on our boards of directors because of his position as a Partner of Veritas Capital, his experience on other public and private company boards and his extensive experience in finance and private equity investment.

Jeffrey P. Kelly serves as a member of our boards of directors. Mr. Kelly is a Vice President at Veritas Capital. Prior to joining Veritas in 2008, Mr. Kelly was a Vice President in the Leveraged Finance Group at Goldman Sachs & Co., where he structured and executed loan and high yield bond financings for leveraged buyouts and strategic acquisitions across a variety of industries. Prior to Goldman Sachs & Co. in 2006, Mr. Kelly worked at Morgan Stanley, raising non-investment grade debt capital for corporate clients in the loan and bond markets. Mr. Kelly currently serves as a Director of Excelitas Technologies Corp. Mr. Kelly holds a B.S. in Finance from Washington University and an M.B.A. from the Kellogg School of Management at Northwestern University. Mr. Kelly was chosen to serve on our boards of directors because of his experience and familiarity with the Company and his extensive experience in finance, capital markets and private equity investment.

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EXECUTIVE COMPENSATION

Compensation Discussion and Analysis

Overview

        On February 11, 2011, the date of the Merger, the Predecessor ceased being a public company subject to the rules of the SEC and the Nasdaq Stock Market. Prior to that date, the Predecessor had a compensation committee of the board of directors composed solely of independent directors that was responsible for the decisions regarding executive compensation. Following the Merger, the board of directors is responsible for establishing our compensation philosophy and programs and determining appropriate payments and awards to our executive officers. The compensation practices and policies described in this Compensation Discussion and Analysis relate to the fiscal year ended October 1, 2010 of the Predecessor, unless otherwise noted or the context so requires, and are not necessarily indicative of how we will compensate our officers in the future. As used in this "Executive Compensation" section only, unless the context indicates or otherwise requires, the terms "we," "us," "our," and "Company" refer to the Predecessor.

Compensation Philosophy and Objectives

        Attracting, retaining and motivating well-qualified executives are essential to the success of any company. The business and product lines of the Company are specialized and require executives with specialized knowledge and unique experience. Accordingly, we have assembled a team of executive officers having deep, specialized knowledge of our particular business and product lines. The goals of our compensation program are to provide significant rewards for successful performance, to encourage stability of our management team and retention of top executives who may have attractive opportunities at other companies and to align the executive officers' interest with those of our stockholders. We seek to achieve these goals by placing a major portion of each executive officer's total compensation at risk, in the form of Management Incentive Plan ("MIP") awards and stock option, restricted stock and restricted stock unit awards, while providing each executive officer an opportunity to profit if we achieve or exceed the objective targets set forth in the MIP or if our stock price increases. We also intend for the level of total compensation available to an executive officer who successfully enhances stockholder value to be fair as compared to the total compensation available to our other executive officers, as well as competitive in the marketplace. We believe that our executive compensation policy has been successful in encouraging stability and retention because our executive officers have an average tenure of more than 25 years with us and our predecessor companies.

        Our compensation decisions are made by the Compensation Committee, which is composed entirely of non-executive members of our Board of Directors. The Compensation Committee retained an independent compensation consultant, Frederic W. Cook & Co., Inc., in designing our 2006 Equity and Performance Incentive Plan and in evaluating our compensation program immediately before our initial public offering. The Compensation Committee has subsequently used the same consultant to provide updates. In connection with making compensation determinations for the 2010 fiscal year, the Compensation Committee consulted with the consultant regarding major changes and trends in pay levels and program design. The Compensation Committee also receives recommendations from our chief executive officer and from time to time considers publicly available information on the executive compensation of peer group companies. At the end of fiscal year 2010, the Compensation Committee's consultant prepared a peer group compensation comparison, which was based on a peer group of 14 publicly traded specialty electronic and communication companies. Those companies include Aero-Vironment, Inc.; American Science & Engineering, Inc.; Analogic Corporation; Anaren, Inc.; Comtech Telecommunications Corp.; EMS Technologies, Inc.; Kratos Defense & Security Solutions , Inc.; Mercury Computer Systems, Inc.; Newport Corporation; OSI Systems, Inc.; Rogers Corporation; Spectrum Control, Inc.; Teledyne Technologies, Inc.; and ViaSat, Inc. The analysis was based on a comparison of the Company's compensation for fiscal year 2010 to adjusted calculations of the publicly disclosed compensation figures for peer group executives for 2009. Because only two of the companies in the peer group had chief operating officers, compensation information for our chief operating officer were based on comparisons to the second highest paid executive for the peer group.

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        Internal Revenue Code Section 162(m) generally disallows a tax deduction to reporting companies for compensation over $1,000,000 paid to each of the Company's chief executive officer and the four other most highly compensated officers, except for compensation that is "performance-based." Our general intent is to design compensation awards to our named executive officers so that the awards will be deductible without limitation. However, we may make compensation awards that are not deductible if our best interests so require.

Elements and Brief Description of Components of Compensation

        The table below lists the elements of our current compensation program for named executive officers and briefly explains the purpose of each element:

Element of Our Compensation Program	Brief Description	How This Element Promotes Our Objectives
Annual Compensation:
—Salary	Fixed annual compensation	Intended to be generally at or below market, so that a larger proportion of total compensation will be at risk
—Management Incentive Plan	Opportunity to earn "performance-based" compensation for achieving or exceeding pre-set financial and performance goals	Motivate and reward achievement of annual operating goals and other pre-set performance goals that enhance stockholder value
Long-term Compensation:
—Stock Options	Stock options, generally granted on an annual basis with vesting terms	Highly leveraged risk and reward aligned with creation of stockholder value; vesting terms promote retention
—Restricted Stock and     Restricted Stock Units	Grants of restricted stock and restricted stock units, subject to vesting terms	Unleveraged risk and reward aligned with creation of stockholder value; vesting terms promote retention
Retirement Savings and Pension:
—401(k) Plan	Qualified 401(k) plan, including employer contributions, intended to encourage savings for retirement	Program available to all employees
—Non-qualified Deferred     Compensation Plan	Deferral opportunities and employer contributions under a fixed formula provided to executive officers in excess of legal maximums under 401(k) plan	Competitive compensation intended to help retain executive officers
—Retirement Plan for Chief     Executive Officer	Defined benefit pension plan for chief executive officer under Canadian law	Retirement pension accruing over years of service; common practice for Canadian executives in lieu of participation in broad-based defined contribution plan

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Element of Our Compensation Program	Brief Description	How This Element Promotes Our Objectives
Severance Payments and Benefits:
—Severance Payments and     Benefits in General	Payments and benefits provided to certain executive officers upon termination of employment and in specified circumstances	Competitive employment agreement terms intended to retain certain executive officers
—Severance Payments and     Benefits after a Change     in Control	Payments and benefits upon termination of an executive officer's employment and in specified circumstances following a change in control	Intended to provide financial security to attract and retain executive officers under disruptive circumstances of a change in control and to encourage management to identify, consider and pursue transactions that would benefit stockholders, but that might lead to termination of employment
Other Compensation Elements:
—Benefits	Health, life and disability benefits	Standard benefits for all employees
—Perquisites	Personal benefits, such as automobile allowance	Intended to provide competitive compensation

        The elements of our compensation program are further described as follows:

Salary

        In view of our desire to reward performance and loyalty and to place a significant portion of each executive officer's compensation at risk, we regard salary as only one component of the compensation of our named executive officers. We originally determined the base salaries of our named executive officers so that they would be somewhat below the market for salaries that peer group companies pay to similar officers. The salaries of our named executive officers were originally determined in the course of negotiations over their employment agreements. In preparing those employment agreements, we were assisted by legal counsel and, where appropriate, qualified compensation consultants.

        Our Compensation Committee generally reviews the base salaries of our named executive officers annually, after receiving recommendations from our chief executive officer and, when appropriate, independent compensation consultants. Through the end of the 2010 fiscal year, our chief executive officer has not had an increase in his base salary (as denominated in Canadian dollars) since October 2004. Based on peer group data for calendar years 2009 and 2010, we believe that the base salaries for our chief executive officer and our chief financial officer are near the median for our peer group and that the base salary for our chief operating officer is between the 50th and 75th percentile for our peer group. Salaries for our other named executive officers are not determined based on comparisons with the above peer group companies but are instead determined based on a number of factors, including: informal data regarding salaries for comparable positions at other companies; geographic location/cost of living; the scope of the officer's responsibilities and the size and importance of the officer's business unit; and considerations of internal pay parity.

Management Incentive Plan

        Under our Management Incentive Plan, our Compensation Committee sets objective financial and performance goals near the beginning of each fiscal year. Each executive officer receives an award determined by the Compensation Committee under which he will receive a bonus equal to a

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percentage of his base salary; the applicable percentage depends on whether, and the extent to which, the objective performance goals are achieved for the fiscal year. For each fiscal year, the Compensation Committee determines a minimum level of objective performance goals that must be achieved before the executive officers will receive any bonuses under the MIP. Our policy is to set these thresholds relatively high, so that there is a meaningful chance that the executive officers will not be rewarded if our performance falls short of the predetermined, objective performance goals. On the other hand, the parameters of our MIP are designed with the goal that if the predetermined, objective performance goals are met or exceeded, the executive officers will receive bonuses which as a percentage of salary are at or above the bonuses paid by our peer companies. The intended result is that our executive officers will have a higher percentage of their total compensation at risk than comparable officers at our peer companies. If our actual performance exceeds the predetermined, objective performance goals by a sufficient amount, the intended result is that the bonuses that our executive officers receive under the MIP will be large enough to compensate for the fact that their base salaries may be below market, so that their total cash compensation can exceed the median cash compensation paid by our peer companies to their executive officers. The goals and calculations underlying the MIP for fiscal year 2010 are discussed in greater detail under "—Management Incentive Plan Awards for Fiscal Year 2010."

        In setting the pre-determined, objective performance goals and the awards for individual executives for a fiscal year under the MIP, our Compensation Committee receives recommendations from our chief executive officer and, where appropriate, independent compensation consultants. Our Compensation Committee consulted with the independent compensation consultant when setting objective performance goals and awards for fiscal year 2010 to ensure that such goals were generally in line with the then-current compensation trends. Based on data collected at the end of the 2010 fiscal year, we believe that the target payouts under the MIP as a percentage of base salary for our chief executive officer and our chief financial officer for fiscal year 2010 were at or near the median for our peer group, and the target payout under the MIP for our chief operating officer was between the 50th and 75th percentile for our peer group percentile for our peer group. The target payout for each other named executive officer for fiscal 2010 was not determined based on comparisons with the above peer group companies but was instead determined based on a number of factors, including: informal data regarding salaries and bonus for comparable positions at other companies; geographic location/cost of living; the scope of the officer's responsibilities and the size and importance of the officer's business unit; and considerations of internal pay parity.

Stock Options; Restricted Stock and Restricted Stock Units

        We believe that awards of stock options, restricted stock and restricted stock units to named executive officers provide a valuable long-term incentive for them and aligns their interests with those of our stockholders. We believe that stock options are a vital component of our philosophy of compensating named executive officers for successful results, as they can realize value on their stock options only if the stock price increases.

        We also believe that unvested options are a significant tool to encourage retention. Our stock options typically vest over a four-year period, which encourages our named executive officers to think about our long-term success and also creates greater likelihood of in-the-money, unvested options that will encourage a named executive officer to remain with us rather than exploring other promising opportunities.

        Our Compensation Committee determines the size of each grant, after receiving advice from our chief executive officer and, when appropriate, independent compensation consultants. Stock option grants are awarded annually as of the date of the Compensation Committee's annual meeting in December. We may also grant options to a newly hired executive officer on his date of hire. The exercise price of each stock option is the closing price of our stock on the day of the Compensation

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Committee's meeting or, in the case of options we may grant to newly hired executive officers, on the date of hire. The Compensation Committee does not delegate to management or others its decisions regarding stock options granted to named executive officers. We do not intend to grant options while in possession of material non-public information, except pursuant to a pre-existing policy under which options are granted on the fixed dates of our annual Compensation Committee meetings in December or on the date of hire to newly hired executive officers.

        In addition, we want our named executive officers to have a meaningful equity ownership in the Company even if the value of our stock does not increase and their stock options therefore are not valuable. Accordingly, the Company has minimum share ownership guidelines for our executive officers. In fiscal year 2008, we began making grants of either restricted stock or restricted stock units to the named executive officers, and we continued to do so in fiscal years 2009 and 2010. To encourage our named executive officers to remain with us, the restricted stock and the restricted stock units are typically subject to a four-year vesting schedule.

        The determination of the amount of stock option, restricted stock and restricted stock unit grants is determined through a "shareholder value transfer" analysis, which represents the present fair market value of aggregate long-term equity grants (restricted stock, restricted stock units and stock option awards) as a percentage of market capitalization. When determining the aggregate amount of option and stock awards (including those made to non-executive officers), the Compensation Committee based its determinations primarily on a comparative analysis of the shareholder value transfer associated with historical peer group grants. Absent other compelling factors, the Company aims to make grants such that the aggregate resulting "shareholder value transfer" is comparable to the companies in our peer group. For fiscal year 2010, the total shareholder value transfer associated with the Company's total equity grants on a gross basis (e.g., before taking into account cancellations and forfeitures) was below the median and average for our peer group. Calculated net of cancellations and forfeitures, the Company's shareholder value transfer for fiscal year 2010 was above the median and below the average for the peer group. In addition, based on data presented by the independent compensation consultant, the Company believes that the proportion of the total equity grants allocated to our Chief Executive Officer was slightly above the median and below the average figure for the peer group and above the median and average figures for the peer group for our Chief Operating Officer and Chief Financial Officer.

        When allocating equity grants to the named executive officers, the Compensation Committee takes a number of factors into account, including the proportion of total equity awards issued to all named executive officers by our peer group. For fiscal year 2010, the proportion of the annual equity incentive awards allocated to our chief executive officer, as measured by shareholder value transfer amounts, was near the median for the chief executive officers of our peer companies, while the proportion allocated to our chief operating officer and chief financial officer, as measured by shareholder value transfer amounts, was above the 75th percentile for the comparable officers of the peer companies.

        The amount of equity grants for each other named executive officer for fiscal 2010 was not determined based on comparisons with the above peer group companies but was instead determined based on a number of factors, including the scope of the officer's responsibilities and the size and importance of the officer's business unit and considerations of internal pay parity.

        In addition, the equity grants for each named executive officer are divided between options and restricted stock or restricted stock units based on a general review of existing practice and custom for publicly traded companies, without relying on any particular peer group.

Equity Treatment in Connection with and Following the Merger

        Pursuant to the terms of the Merger Agreement, except as provided below, (i) each option to purchase common stock of the Company granted under the Company's equity compensation plans outstanding immediately prior to the effective time of the Merger vested and was canceled at the

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effective time of the Merger (or, in certain cases, immediately following the effective time of the Merger) in exchange for a cash payment equal to the excess, if any, of $19.50 over the per-share exercise price of such option and (ii) each restricted stock award and restricted stock unit award granted under the Company's equity compensation plans that was outstanding immediately prior to the effective time of the Merger was canceled at the effective time of the Merger in exchange for a payment, in cash, equal to $19.50 (less, in each case, applicable withholding amounts).

        With respect to options to purchase common stock of the Company, restricted stock awards and restricted stock unit awards granted after the date of the Merger Agreement, only 25% of such options, restricted stock and restricted stock units were treated as described above and the remaining 75% of such options, restricted stock and restricted stock units were cancelled without consideration.

        In connection with the Merger, certain members of management were invited to invest in Holding LLC, which owns all of the common stock of Parent, which in turn owns all of the common stock of CPII. Accordingly, certain members of the Company's management invested in Class A Membership Interests of Holding LLC in an aggregate amount of $11.1 million. This permits such executives to share in any increase in the value of CPII and is intended to focus their efforts on CPII's long-term results. The primary equity interest in Holding LLC is the Class A membership interests, of which a substantial controlling interest is owned by affiliates of the Sponsor. As a group, management owns 5.26% of the Class A membership interests.

        Certain members of management may be granted Class B membership interests in Holding LLC. Pursuant to the terms of the limited liability company operating agreement governing Holding LLC, holders of Class B membership interests are entitled to receive a percentage of all distributions, if any, made by Holding LLC after the holders of the Class A membership interests, including affiliates of our Sponsor, have received a return of their invested capital plus an 8% per annum internal rate of return (compounded quarterly and accruing daily) on their unreturned invested capital. The aggregate amount of outstanding Class B membership interests shall not exceed 7.5% of the aggregate amount of all outstanding Class A and Class B membership interests. The Class B membership interests are intended to provide incentives to management to focus on the long-term value of CPII. These Class B membership interests will be non-transferable and will vest ratably over five years, which is intended to provide a retention incentive.

Deferred Compensation

        We offer a non-qualified deferred compensation plan for our executive officers and other employees who are part of a select group of highly compensated or management employees. This deferred compensation plan provides participants with an opportunity to defer payments of a specified percentage of their base salary and Management Incentive Plan bonus. In addition, we make employer contributions to the deferred compensation plan under a formula. We believe that this deferred compensation plan is desirable to make the overall compensation package of our executive officers competitive with those of our peer companies. Although the employer contributions to the deferred compensation plan for our executive officers are fully vested, they are in relatively small annual amounts as compared to the executive officers' base salaries.

Canadian Defined Benefit Pension Plan for Chief Executive Officer

        We provide a defined benefit pension plan governed by Canadian law to our chief executive officer. The purpose of this plan is to provide retirement income to our chief executive officer after he has completed many years of service to us. The plan is a retention device, as our chief executive officer's benefits under the plan will depend on the number of years of his service to us. The plan is in lieu of our chief executive officer's participation in our Canadian defined contribution plan (analogous to a 401(k) plan) that is generally available to our Canadian employees. Benefits under this defined benefit pension plan are subject to the same statutory limits that are applicable to broad-based plans in

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Canada. Similar plans are common in similarly sized Canadian companies, and this plan is therefore a competitive compensation practice.

Severance Payments, Change-in-control Payments and Related Tax Gross-ups

        Our employment agreements with our named executive officers provide that they will receive certain severance benefits if we terminate their employment without "cause," or, in the case of our (a) chief executive officer, (b) chief operating officer and president, and (c) chief financial officer, treasurer and secretary, if they terminate their employment with "good reason" (e.g., because they are demoted). If their termination of employment follows a change in control of the Company, our chief executive officer, chief operating officer and president, and chief financial officer, treasurer and secretary will receive an enhanced level of severance benefits. Furthermore, if a golden parachute excise tax is imposed on our chief executive officer, chief operating officer and president or chief financial officer, treasurer and secretary in connection with his termination of employment following a change in control, the affected executive will receive "gross-up" payments to make him whole for the golden parachute excise tax. However, if a 10% or less reduction in severance would eliminate the golden parachute tax, then the severance will be reduced to eliminate the tax and no reimbursement will be provided. The details of such arrangements are discussed in the section entitled "—Narrative Disclosure to Summary Compensation Table and Grants of Plan-based Awards Table—Employment Agreements" below.

        The change-in-control provisions contained in the employment agreements of our named executive officers are "double trigger" provisions: i.e., the named executive officer does not receive his change-in-control payments automatically on the occurrence of a change in control, but must either be discharged by the Company (or the applicable subsidiary) without "cause" or (in the case of our chief executive officer, chief operating officer and president, and chief financial officer, treasurer and secretary) terminate his employment with the Company (or the applicable subsidiary) for "good reason" within a stated period after the occurrence of the change in control. Thus, the change-in-control payments are essentially compensation for being fired or forced out of a job in connection with the change in control.

        We believe that the severance provisions in the employment agreements of our executive officers are necessary to retain our executive officers by protecting them against involuntary termination of their employment or being forced out of the Company. The applicable severance provisions following a change in control are intended to encourage our executive officers to consider or pursue potential changes in control that would benefit stockholders, without needing to worry about the potentially negative consequences of the transactions to them personally. The provisions are desirable after a change in control in order to retain the executive officers under disruptive circumstances when their services might be especially necessary. Based on a survey of our peer companies conducted by an independent compensation consultant when we negotiated the employment agreements with our executive officers, we believe that the change-in-control provisions of the employment agreements of our executive officers are well within the range of similar provisions in the employment agreements between our peer companies and their executive officers.

        We believe that the gross-up provisions in the employment agreements of our chief executive officer, chief operating officer and president, and chief financial officer, treasurer and secretary are necessary to enable them to enjoy the full benefit of their change-in-control payments. These provisions will also enable them to assist the Board of Directors in analyzing any offers that might be made for acquisition of control of the Company without the distraction of worrying about the negative tax consequences that they might otherwise incur. Based on a survey of our peer companies conducted by an independent compensation consultant when we negotiated the employment agreements with our executive officers in 2006, we believe several of the companies in our peer group provide such gross-up payments to their named executive officers.

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        The employment agreements remained in effect following the consummation of the Merger and, in connection with the Merger, each named executive officer waived his right to terminate his employment for "good reason" as a result of (i) any change or diminution in his position, authority, duties or responsibilities that may occur because neither the Company, nor any of its affiliates, are publicly-traded companies following the Merger or (ii) the failure of the Company to appoint, or to cause to be appointed, such named executive officer, following the Merger, to any position other than the position agreed upon by the Company and the named executive officer prior to the consummation of the Merger.

        As a result of the Merger, CPII expects to enter into or amend employment agreements with certain executive officers on customary terms and conditions.

All Other Compensation

        All other compensation for our named executive officers includes, among other things, Company contributions under our 401(k) plan, payment of certain legal fees, car allowances and, in the case of our chief executive officer, a tax gross-up on his car allowance. These items are commonly provided by public companies to their executive officers.

        In addition, our named executive officers are permitted to participate in the Company's 2006 Employee Stock Purchase Plan on the same terms and conditions as the Company's other employees.

Risks Associated with the Company's Compensation Policies and Practices

        The Company believes that its compensation policies and practices for all employees, including executive officers, do not create risks that are reasonably likely to have a material adverse effect on the Company.

Compensation Committee Report of Executive Compensation

        The Compensation Committee has reviewed the Compensation Discussion and Analysis for fiscal year 2010 and discussed its contents with the Company's management. Based on such review and discussions, the Compensation Committee recommended to the Board of Directors that the Compensation Discussion and Analysis be included in the annual report on Form 10-K.

Compensation Committee
Michael F. Finley, Chairperson
Jeffrey P. Hughes

Compensation Committee Interlocks and Insider Participation

        Michael F. Finley and Jeffrey Hughes served on the Company's Compensation Committee during fiscal year 2010. None of the members of the Compensation Committee was an officer or employee or former officer or employee of the Company or its subsidiaries, and no such member has any interlocking relationships with the Company that are subject to disclosure under the Securities and Exchange Commission rules relating to compensation committees.

Summary Compensation Table

        The table below summarizes the total compensation paid to or earned for the fiscal year ended October 1, 2010 by:

•

the chief executive officer;

•

the chief financial officer; and

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•

the three other most highly compensated individuals who were serving as executive officers of the Company at the end of the fiscal year.

        These individuals are referred to in this prospectus as the "named executive officers."

Name and Principal Position		Fiscal Year		Salary(c)		Stock Awards(d)		Option Awards(d)		Non-equity Incentive Plan Compensation(e)		Change in Pension Value and Non-qualified Deferred Compensation Earnings(f)		All Other Compensation(g)		Total
O. Joe Caldarelli(a)(b)			2010	$	494,382	$	115,920	$	225,014	$	1,002,980	$	312,052	$	82,844	$	2,233,192
	Chief Executive		2009		418,607		108,840		202,003		258,841		97,621		77,465		1,163,377
	Officer		2008		565,460		201,480		234,900		540,195		24,394		88,798		1,655,227
Joel A. Littman			2010		287,077		57,960		112,507		310,500		—		45,477		813,521
	Chief Financial		2009		267,077		54,420		101,002		113,860		—		39,570		575,929
	Officer, Treasurer & Secretary		2008		283,846		100,740		117,450		129,561		—		41,548		673,145
Robert A. Fickett			2010		336,942		77,280		150,010		554,531		—		49,853		1,168,616
	Chief Operating		2009		319,539		72,560		134,669		219,709		—		45,026		791,503
	Officer & President		2008		342,692		134,320		156,600		227,635		—		45,549		906,796
Andrew E. Tafler(a)			2010		183,022		38,640		75,005		202,864		—		37,097		536,628
	Vice President		2009		158,631		36,280		67,334		94,608		—		32,515		389,368
			2008		192,907		67,160		78,300		92,307		—		39,149		469,823
Don C. Coleman			2010		196,561		38,640		75,005		87,113		—		36,231		433,550
Vice President			2009		190,523		36,280		67,334		46,652		—		34,355		375,144
			2008		200,077		67,160		78,300		86,210		—		33,182		464,929

(a)

For Mr. Caldarelli and Mr. Tafler, salary, non-equity incentive plan compensation and all other compensation amounts are denominated in Canadian Dollars. Salary and all other compensation amounts were converted to U.S. Dollars using the average exchange rate during fiscal year 2010 of approximately US$0.95 for C$1.00, during fiscal year 2009 of approximately US$0.85 for C$1.00 and during fiscal year 2008 of approximately US$0.99 for C$1.00. Non-equity incentive plan compensation amounts were converted to U.S. Dollars for fiscal year 2010 using an exchange rate as of October 1, 2010 of approximately US$0.97 for C$1.00, for fiscal year 2009 using an exchange rate as of October 2, 2009 of approximately US$0.93 for C$1.00 and for fiscal year 2008 using an exchange rate as of October 3, 2008 of approximately US$0.94 for C$1.00.

(b)

Mr. Caldarelli's base salary had remained constant at C$550,000 since October 2004. During the second half of fiscal year 2009, Mr. Caldarelli agreed to take a voluntary and temporary 20% reduction to his base salary. Excluding this temporary reduction, any changes to his reported base salary in fiscal years 2010, 2009 and 2008 were a result of the changing U.S. Dollar to Canadian Dollar exchange rate.

(c)

Midway through fiscal year 2009, each of the named executive officers agreed to a voluntary reduction in base salary as a contribution to the Company-wide cost reduction plan. The reduction for each officer was 10% of base salary, except for Mr. Caldarelli, who agreed to a 20% reduction. Additionally, there were 26 pay periods in fiscal years 2010 and 2009 as compared to 27 pay periods in fiscal year 2008, which resulted in higher salary numbers in fiscal year 2008.

(d)

The columns represent the grant date fair value calculated in accordance with Financial Accounting Standards Board's Accounting Standards Codification Topic 718, "Compensation—Stock Compensation," for all restricted stocks, restricted stock units, and stock options granted during fiscal year 2010, 2009 and 2008. The amounts represent the grant date estimate of compensation costs to be recognized over the service period, excluding the effect of forfeiture For additional information regarding the assumptions used for the valuation, see Note 9 to the Audited Consolidated Financial Statements included in the Company's Form 10-K filed for the fiscal year ended October 1, 2010, Note 10 to the Audited Consolidated Financial Statements included in the Company's Form 10-K filed for the fiscal year ended October 2, 2009 and Note 9 to the Audited Financial Consolidated Financial Statements included in the Company's Form 10-K filed for the fiscal year ended October 3, 2008. Additional information about the awards and options reflected in the columns is set forth in the notes to the Fiscal Year 2010 Grants of Plan-Based Awards and Outstanding Equity Awards at Fiscal Year-End tables. The amounts also represent the maximum value assuming the highest level of performance conditions is probable.

(e)

Includes amounts earned under the Company's Management Incentive Plan under the Company's 2006 Equity and Performance Incentive Plan for all of the named executive officers. As noted above, for Mr. Caldarelli and Mr. Tafler, the payments are denominated in Canadian Dollars, and fiscal year 2010 amounts were converted to U.S. Dollars using an

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exchange rate as of October 1, 2010 of approximately US$0.97 for C$1.00, while fiscal year 2009 amounts were converted to U.S. Dollars using an exchange rate as of October 2, 2009 of approximately US$0.93 for C$1.00 and fiscal year 2008 amounts were converted to U.S. Dollars using an exchange rate as of October 3, 2008 of approximately US$0.94 for C$1.00.

(f)

Mr. Caldarelli's pension plan is denominated in Canadian Dollars. The aggregate change in the actuarial present value of the pension benefit obligation during fiscal years 2008, 2009 and 2010 consists of the following:

	Fiscal Year 2008			Fiscal Year 2009			Fiscal Year 2010
U.S. Dollar changes in Canadian pension benefit obligation	$	68,366		$	107,071		$	263,362
Increases (Decreases) in pension benefit obligation as a result of the changing U.S. Dollar to Canadian Dollar exchange rate		(43,972	)		(9,450	)		48,689
Total changes in pension benefit obligation in U.S. Dollars	$	24,394		$	97,621		$	312,052

The amounts above were calculated using an exchange rate at the beginning of fiscal year 2008 of approximately US$1.00 for $C$1.00, at the end of 2008 of approximately US$0.94 for C$1.00, at the end of fiscal year 2009 of approximately US$0.93 for C$1.00, and at the end of fiscal year 2010 of approximately US$0.97 for C$1.00.

(g)

Details regarding the various amounts included in this column are provided in the following table entitled "All Other Compensation Table for Fiscal 2010."

All Other Compensation Table for Fiscal 2010

        The components of the amounts shown in the "All Other Compensation" column of the Summary Compensation Table are displayed in detail in the following table.

Name of Executive	Company 401(k) Contribution		Car Allowance (a)		Tax Gross- ups(b)		Payments to Non-qualified Deferred Compensation Plan(c)		Cash in Lieu of Pension (d)		Payments to Defined Contribution Plan(e)		Other Compensation		Total(f)
O. Joe Caldarelli	$	—	$	51,805	$	17,685	$	—	$	13,354	$	—	$	—	$	82,844
Joel A. Littman		9,554		25,200		—		10,723		—		—		—		45,477
Robert A. Fickett		9,153		25,200		—		15,500		—		—		—		49,853
Andrew E. Tafler		—		23,959		—		—		2,548		10,590		—		37,097
Don C. Coleman		6,709		25,200		—		4,322		—		—		—		36,231

(a)

Represents the total cost to the Company for use by the named executive officer of a company car during fiscal year 2010. For Mr. Caldarelli, this amount includes a car allowance in the amount of C$21,840, with the balance consisting of amounts paid by the Company for lease costs, reimbursement of gas, maintenance costs and car insurance. For Mr. Caldarelli and Mr. Tafler, the amounts were converted to U.S. Dollars using the average exchange rate during fiscal year 2010 of approximately US$0.95 for C$1.00.

(b)

Represents tax gross-ups paid to Mr. Caldarelli related to the use of a company car. The amounts were converted to U.S. Dollars using the average exchange rate during fiscal year 2010 of approximately US$0.95 for C$1.00.

(c)

Represents amount to be contributed by the Company to the non-qualified deferred compensation plan for fiscal year 2010.

(d)

The Company's Canadian subsidiary makes contributions to a defined benefit plan (discussed under "—Pension Benefits" below) for the benefit of Mr. Caldarelli and to a defined contribution plan for the benefit of other Canadian employees, including Mr. Tafler. The amounts in this column represent the excess of the amount the Company is obligated to contribute over the governmentally imposed limitation on contributions. For Mr. Caldarelli, this amount was paid to an investment advisor managing investments in the defined benefit plan. For Mr. Tafler this amount was paid to him in cash. The amounts shown are denominated in Canadian Dollars and were converted to U.S. Dollars using the average exchange rate during fiscal year 2010 of approximately US$0.95 for C$1.00.

(e)

Represents C$11,148 contributed by the Company to the defined contribution plan for fiscal year 2010. The amount is denominated in Canadian Dollars and was converted to U.S. Dollars using the average exchange rate during fiscal year 2010 of approximately US$0.95 for C$1.00.

(f)

The total amounts do not include approximately $59,000 of legal fees paid by the Company in connection with legal advice provided by separate legal counsel relating to employment matters for the named executive officers in connection with the potential transaction with Comtech Telecommunications Corp.

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Grants of Plan-based Awards For Fiscal Year 2010

        The following table provides information concerning grants of plan-based awards to each of the named executive officers for the fiscal year ended October 1, 2010.

													All Other Stock Awards: Number of Shares of Stock or Stock Units(3) (#)
					Estimated Future Payments Under Non-equity Incentive Plan Awards(1)										All Other Option Awards: Number of Securities Underlying Options(4) (#)				Grant Date Fair Value of Stock and Option Awards ($)
											Actual Payouts Under Non-equity Incentive Plan Awards(2) ($)						Exercise or Base Price of Option Awards ($/Sh)
			Date of Approval by Compensation Committee
Name	Grant Date				Threshold ($)		Target ($)		Maximum ($)
O. Joe Caldarelli(5)		—		—	$	156,750	$	522,500	$	1,097,250	$	1,002,980		—		—		—		—
		12/8/09		12/8/09		—		—		—		—		12,000		36,000	$	9.66	$	340,934
Joel A. Littman		—		—		54,000		180,000		360,000		310,500		—		—		—		—
		12/8/09		12/8/09		—		—		—		—		6,000		18,000		9.66		170,467
Robert A. Fickett		—		—		78,750		262,500		590,625		554,531		—		—		—		—
		12/8/09		12/8/09		—		—		—		—		8,000		24,000		9.66		227,290
Andrew E. Tafler(5)		—		—		28,215		94,050		211,613		202,864		—		—		—		—
		12/8/09		12/8/09		—		—		—		—		4,000		12,000		9.66		113,645
Don C. Coleman		—		—		30,300		101,000		227,250		87,113		—		—		—		—
		12/8/09		12/8/09		—		—		—		—		4,000		12,000		9.66		113,645

(1)

Amounts represent possible payouts under the Company's Management Incentive Plan under the Company's 2006 Equity and Performance Incentive Plan for fiscal year 2010 for all of the named executive officers.

(2)

The amounts in this column represent the actual payouts under the Management Incentive Plan under the Company's 2006 Equity and Performance Incentive Plan for fiscal year 2010 for all of the named executive officers. The amounts in this column are also included in the Non-equity Incentive Plan Compensation column of the Summary Compensation Table.

(3)

Represents restricted stock units granted under the Company's 2006 Equity and Performance Incentive Plan on December 8, 2009. The restricted stock units are subject to time-vesting and performance-vesting conditions. All of such shares are broken up into four tranches (each a "Tranche"), each consisting of one-fourth of the unvested shares. The unvested shares in each Tranche become fully vested only if both the time-vesting conditions (described below) and the performance conditions (described below) are satisfied with respect to such unvested shares. The time-vesting conditions are satisfied at a rate of 25% per year based on continued employment over a four-year period. The performance conditions are based on the achievement of specified EBITDA levels:

a)

Year 1, the first Tranche will vest at 100% if Adjusted EBITDA at or over $60 million; at 50% if Adjusted EBITDA at $50 million; zero if Adjusted EBITDA below $50 million; and straight-line between points.



b)

Year 2, the second Tranche will vest at 100% if Adjusted EBITDA at or over $63 million; at 50% if Adjusted EBITDA at $52.5 million; zero if Adjusted EBITDA below $52.5 million; and straight-line between points;



c)

Year 3, the second Tranche will vest at 100% if Adjusted EBITDA at or over $66.2 million; at 50% if Adjusted EBITDA at $55.1 million; zero if Adjusted EBITDA below $55.1 million; and straight-line between points;



d)

Year 4, the second Tranche will vest at 100% if Adjusted EBITDA at or over $69.5 million; at 50% if Adjusted EBITDA at $57.9 million; zero if Adjusted EBITDA below $57.9 million; and straight-line between points;



Under the terms of the Merger Agreement, these restricted stock units vested upon the consummation of the Merger.

(4)

Represents stock options granted under the Company's 2006 Equity and Performance Incentive Plan on December 8, 2009. The options vest at a rate of 25% on each of the first four anniversaries of the grant date. Under the terms of the Merger Agreement, these shares of stock options vested upon the consummation of the Merger.

(5)

For Mr. Caldarelli and Mr. Tafler, estimated future payments under non-equity incentive plan awards and actual payouts under non-equity incentive plan awards are denominated in Canadian Dollars. Estimated future payments under non-equity incentive plan awards were converted using the average exchange rate during fiscal year 2010 of approximately US$0.95 for C$1.00. Actual payouts under non-equity incentive plan awards were converted to U.S. Dollars using an exchange rate as of October 1, 2010 of approximately US$0.97 for C$1.00.

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Narrative Disclosure to Summary Compensation Table and Grants of Plan-based Awards Table

Employment Agreements

Messrs. Caldarelli, Fickett and Littman

        Communications & Power Industries Canada Inc., a subsidiary of the Company, is a party to an employment agreement with Mr. Caldarelli, and Communications & Power Industries, Inc., also a subsidiary of the Company, is party to an employment agreement with each of Messrs. Fickett and Littman. The term of each employment agreement commenced on April 27, 2006 and continued for a three-year period thereafter. Each agreement is automatically extended for additional one-year periods thereafter, unless the employer or the executive officer gives notice of non-renewal at least six months prior to the end of the term. No notices of non-renewal have been provided with respect to these agreements.

        Each agreement provides for the following initial base salary, subject to upward adjustment by the Board of Directors of the Company in its sole discretion: Mr. Caldarelli—C$550,000; Mr. Fickett—US$300,000; and Mr. Littman—US$230,000.

        Each of these executive officers is eligible to receive an annual cash bonus through participation in the Company's Management Incentive Plan, as in effect from time to time, and awards through the Company's 2006 Equity and Performance Incentive Plan. For the 2010 fiscal year, the target bonuses for Messrs. Caldarelli, Fickett and Littman under the Company's MIP were 1.0, 0.75 and 0.60, respectively, times their respective base salaries. Each of these executive officers is eligible to participate in other benefit plans, policies and programs.

        If the employment of any of these executive officers is terminated by the employer for cause, is terminated as a result of the death or disability of the executive officer or is terminated by the executive officer other than for good reason, then the employment agreement will terminate immediately, and the executive officer will be entitled to receive only (a) accrued but unpaid salary through the date of termination and vacation pay and other cash compensation or cash entitlements as of the date of termination and (b) in the case of any termination other than by the employer for cause and by the executive officer without good reason, if the executive officer has been employed for at least six months during the fiscal year, a partial bonus for the fiscal year of termination equal to the full bonus payable multiplied by a fraction equal to the fraction of the fiscal year preceding the executive officer's termination.

        If the employment of any of these executive officers is terminated by the employer without cause or by the executive officer for good reason, as applicable, then the executive officer will be entitled to receive severance payments equal to a multiple of the sum of the executive officer's base salary and the average value of the MIP and other performance bonuses received by the executive officer for the three fiscal years preceding the termination date. The applicable multiples for Messrs. Caldarelli, Fickett and Littman are 2.0, 1.5 and 1.5, respectively. In addition, all unvested options and other equity awards will immediately become vested. If the termination occurs more than six months after the beginning of a fiscal year, then the executive officer will be eligible to receive a prorated bonus for the year of termination.

        In addition, in the case of a termination without cause or a resignation for good reason within the two-year period following a change of control, the severance payments will be equal to a specified multiple of the sum of the executive officer's base salary and the highest MIP or other performance bonus received by the executive officer during the three fiscal years preceding the termination date. The applicable multiples for Messrs. Caldarelli, Fickett and Littman in this case are 2.5, 2.0 and 2.0, respectively.

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        In the case of a termination without cause or a resignation for good reason, Messrs. Caldarelli, Fickett and Littman will be eligible to continue receiving certain benefits for 24 months, 18 months and 18 months, respectively, following termination. If the termination occurs within the two-year period following a change of control, the applicable benefit continuation periods for Messrs. Caldarelli, Fickett and Littman will be 30 months, 24 months and 24 months, respectively.

        If any compensation payable to an executive officer upon termination is deemed to be "deferred compensation" within the meaning of Section 409A of the Internal Revenue Code, if the stock of the Company (or one of its affiliates) is publicly traded on an established securities market or otherwise and if the executive officer is determined to be a "specified employee" as defined in Section 409A(a)(2)(B)(i) of the Internal Revenue Code, then payment of such compensation will be delayed as required pursuant to Section 409A of the Internal Revenue Code. Such delay will last six months from the date of the executive officer's termination except in the event of the executive officer's death. This provision should not apply to Mr. Caldarelli, as he receives no U.S.-source income from the Company.

        As a condition to receiving the benefits and payments described above in connection with a termination by the employer without cause or termination by the executive officer for good reason, the executive officer will be required to execute a release of any claims and potential claims against the employer and its affiliates and directors relating to the executive officer's employment, and the executive officer and the employer will also enter into reasonable mutual non-disparagement covenants.

        Following the termination of employment of any of the executive officers without cause or a resignation for good reason, the executive officer will be subject to a post-termination non-compete covenant and a post-termination covenant not to solicit any of the Company's current or potential customers. The duration of these covenants will be equal to the duration of the post-termination period during which the Company is obligated to provide benefits as described above. In addition, if their employment is terminated for any reason, Messrs. Caldarelli, Fickett and Littman will be prohibited from soliciting for employment any of the Company's employees for a 24-month, 18-month and 18-month period, respectively, following termination (or, if longer, the period during which they are subject to the non-compete covenant).

        For each of the executive officers, good reason generally means any of the following (i) assignment to the executive officer of any duties inconsistent with the executive officer's positions with the Company and Communications & Power Industries, Inc. (and, in Mr. Caldarelli's case, also Communications & Power Industries Canada Inc.) as set forth in the employment agreement (including status, offices, titles and reporting requirements), authorities, duties or responsibilities as contemplated in the employment agreement or any action by the Company (in the case of all three executive officers), Communications & Power Industries, Inc. (in the case of Messrs. Fickett or Littman) or Communications & Power Industries Canada Inc. (in Mr. Caldarelli's case) that results in diminution in such positions, authority, duties or responsibilities; (ii) failure by the employer to comply with the provisions of the employment agreement; (iii) relocation of the office where the executive officer is required to report to a location that is 50 or more miles from the executive officer's current location; (iv) failure to appoint the executive officer as chief executive officer (in Mr. Caldarelli's case), chief financial officer (in Mr. Littman's case) and president and chief operating officer (in Mr. Fickett's case) of the combined or acquiring entity in the case of a change of control, reporting to the new entity's board of directors; (v) notice to the executive officer that the term of the employment agreement will not be extended; or (vi) in Mr. Caldarelli's case, failure by the stockholders of the Company to re-elect him as a member of the Board of Directors, with full voting rights.

        As described above in "—Severance Payments, Change-in-control Payments and Related Tax Gross-ups," in connection with the Merger, each named executive officer waived his right to terminate his employment for "good reason" in certain circumstances following the Merger.

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        For each of the executive officers, cause generally means any of the following: (a) acts or omissions by the executive officer that constitute intentional material misconduct or a knowing violation of a material policy of the Company or any of its subsidiaries, (b) the executive officer personally receiving a benefit in money, property or services from the Company or any of its subsidiaries or from another person dealing with the Company or any of its subsidiaries, in material violation of applicable law or policy of the Company or any of its subsidiaries, (c) an act of fraud, conversion, misappropriation or embezzlement by the Company or his conviction of, or entering a guilty plea or plea of no contest with respect to a felony or the equivalent thereof (other than DUI) or (d) any deliberate and material misuse or deliberate and material improper disclosure of confidential or proprietary information of the Company or any of its subsidiaries. No act or omission by the executive officer constitutes cause unless the employer has given detailed written notice thereof to the executive officer, and the executive officer has failed to remedy such act or omission within a reasonable time after receiving such notice.

        If any payments made by the employer to Mr. Caldarelli, Fickett or Littman would result in the imposition of the golden parachute excise tax under Section 280G of the Internal Revenue Code of 1986, then the employer will reimburse the affected executive officer for the amount of the tax, on a grossed-up basis to cover any taxes on the reimbursement payment. However, if a 10% or less reduction in severance would eliminate the golden parachute tax, then the severance will be reduced to eliminate the tax and no reimbursement will be provided. We do not believe any Section 280G excise tax will apply to Mr. Caldarelli, as he receives no U.S.-source income from the Company.

Mr. Coleman

        Communications & Power Industries, Inc. has an employment letter, dated November 2, 2002, with Mr. Coleman that provides for an annual base salary of $159,000. The current practice is for the base salary to be reviewed and adjusted as appropriate. The letter provides that Mr. Coleman is entitled to participate in the Company's Management Incentive Plan. If Mr. Coleman is terminated without cause, he will be entitled to continued payment of his base salary for 12 months. If Mr. Coleman is terminated without cause at any time during the two-year period following a change-in-control event, he will be entitled to continued payment of base salary for 12 months. In addition, upon a termination without cause, including in connection with such termination within two years after a change-in-control event, Mr. Coleman will be entitled to the continuation of employee benefits for the severance period, 100% of the management incentive award that otherwise would have been earned by him, continued use of his company car and full outplacement services. In order to receive the foregoing severance benefits, Mr. Coleman will be required to execute a general release in favor of the employer.

Mr. Tafler

        Communications & Power Industries Canada Inc., a subsidiary of the Company, is a party to an employment letter agreement, dated June 21, 2004, with Mr. Tafler that provides for an annual base salary of $165,000. The Company's current practice is for the base salary to be reviewed and adjusted as appropriate. The letter provides that Mr. Tafler is entitled to participate in the Company's Management Incentive Plan. Mr. Tafler is also entitled to participate in the executive car program and the defined contribution plan, if Mr. Tafler is terminated without cause, he will be entitled to continued payment of base salary for 12 months. If Mr. Tafler is terminated without cause at any time during the two-year period following a change-in-control event, he will be entitled to continued payment of base salary for 12 months, the continuation of employee benefits for the severance period, 100% of the management incentive award that otherwise would have been earned by him, continued use of his company car and full outplacement services. In order to receive the foregoing severance benefits, Mr. Tafler will be required to execute a general release in favor of the employer.

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2006 Equity and Performance Incentive Plan

        The Company adopted its 2006 Equity and Performance Incentive Plan (as amended, the "2006 Plan") in April 2006. The 2006 Plan was approved by stockholders of the Company at the time of adoption. In 2009, the Company's stockholders approved amendments to the 2006 Plan at the 2009 annual stockholders meeting on February 24, 2009, including increasing the number of shares subject to the 2006 Plan by 1,400,000. The 2006 Plan is administered by a Committee of the Board designated by the Board in accordance with the provisions of the 2006 Plan, which is currently the Company's Compensation Committee. All of the Company's employees (including officers), directors and consultants are eligible for awards under the 2006 Plan.

        Awards under the 2006 Plan may consist of options, stock appreciation rights, restricted stock, other stock unit awards, performance awards, dividend equivalents or any combination of the foregoing. The 2006 Plan provides for an aggregate of up to 2,800,000 shares of the Company's common stock to be available for awards, plus the number of shares subject to awards granted under the Company's 2004 Stock Incentive Plan and 2000 Stock Option Plan (the "Prior Plans") that are forfeited, expire or otherwise terminate without issuance of shares, or are settled for cash or otherwise do not result in the issuance of shares, on or after the effective date of the 2006 Plan. Grants of share-based awards (other than options or stock appreciation right awards) made under the 2006 Plan on or after February 24, 2009 will count as two shares for purposes of determining whether the cap on the total number of shares issuable under the 2006 Plan has been exceeded.

        In addition, if any shares subject to an award under the 2006 Plan or to an award under the Prior Plans are forfeited, expire or are terminated without the issuance of such shares, or are settled for cash or otherwise do not result in the issuance of such shares, or are received or withheld by the Company to satisfy tax liabilities arising from the grant of an award or as a result of shares to pay the option price, then such shares will again be available for award under the 2006 Plan. Any shares that again become available for grant will be added back as one share except that share-based awards (other than options or stock appreciation rights) issued on or after February 24, 2009 will count as two shares. In the event of any merger, reorganization, consolidation, recapitalization, dividend or distribution (excluding any cash divided or distribution), stock split, reverse stock split or similar transaction affecting the shares, the Compensation Committee will make equitable, proportionate and appropriate adjustments to the 2006 Plan and the awards (including making such adjustments to the number of shares available under the Plan and the number of shares subject to outstanding awards).

        No participant may be granted restricted stock, performance awards and/or other stock unit awards that are denominated in shares totaling more than 460,000 shares in any 12-month period. In addition, the maximum dollar value payable to any participant during any 12-month period with respect to performance awards and/or other stock unit awards that are valued with reference to cash or property other than shares is $3,000,000. Under the 2006 Plan, the purchase price for shares covered by an award cannot be less than 100% of the fair market value of the underlying shares on the grant date. The Compensation Committee has no authority to reprice any option, to reduce the base price of any stock appreciation right or to cancel any option when the fair market value of the shares is less than the option's exercise price.

        As of January 20, 2011, 899,283 shares remained available for awards under the 2006 Plan.

        The 2006 Plan is intended to comply with Section 162(m) of the Code and the regulations promulgated thereunder, resulting in the tax deductibility of amounts payable under the 2006 Plan to the chief executive officer or other named executive officers whose compensation is reported in this 10-K/A as "performance-based" compensation.

        Performance awards under the 2006 Plan are awards that provide payments determined by the achievement of performance goals over a performance period. The Compensation Committee, in its

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discretion, may issue performance awards to participants, and upon the grant of a performance award, determines the relevant performance goals and the performance period. The performance goals are based on the attainment of specified levels of or growth of one or any combination of the following factors, or an objective formula determined at the time of the award that is based on modified or unmodified calculations of one or any combination of the following factors: net sales; pretax income before or after allocation of corporate overhead and bonus; earnings per share; net income; division, group or corporate financial goals; return on stockholders' equity; return on assets; attainment of strategic and operational initiatives; appreciation in and/or maintenance of the price of the shares or any of the Company's other publicly traded securities; market share; gross profits; earnings before taxes; earnings before interest and taxes; EBITDA; an adjusted formula of EBITDA determined by the Compensation Committee; economic value-added models; comparisons with various stock market indices; reductions in costs; and/or return on invested capital of the Company or any affiliate, division or business unit of the Company for or within which the participant is primarily employed. Such performance goals also may be based solely by reference to the Company's performance or the performance of an affiliate, division or business unit of the Company, or based upon the relative performance of other companies or upon comparisons of any of the indicators of performance relative to other companies. The Company's annual Management Incentive Plan bonuses (discussed below under "Management Incentive Plan Awards for Fiscal Year 2010") are paid to executives and employees under the 2006 Plan. Unless the Compensation Committee specifies otherwise when it sets performance goals for an award, the Compensation Committee will make objective adjustments to any of the foregoing measures for items that will not properly reflect the Company's financial performance for these purposes, such as the write-off of debt issuance costs, pre-opening and development costs, gain or loss from asset dispositions, asset or other impairment charges, litigation settlement costs, and other non-routine items that may occur during the Performance Period. Also, unless the Compensation Committee determines otherwise in setting the performance goals for an award, such performance goals will be applied by excluding the impact of (a) restructurings, discontinued operations and charges for extraordinary items, (b) an event either not directly related to the operations of the Company or not within the reasonable control of the Company's management or (c) a change in accounting standards required or recommended by generally accepted accounting principles.

        As discussed in "—Equity Treatment in Connection with the Merger" all outstanding equity awards under the 2006 Plan were cancelled in connection with the Merger.

Management Incentive Plan Awards for Fiscal Year 2010

        For fiscal year 2010, the Compensation Committee established goals under the Management Incentive Plan based on earnings before interest, taxes, depreciation and amortization, further adjusted to exclude certain non-cash and non-recurring items ("Adjusted EBITDA"), and cash flows from operating activities before taxes, interest and non-recurring expenses, less recurring cash flow from investing activities ("Adjusted Operating Cash Flow"). Minimum and maximum Adjusted EBITDA and Adjusted Operating Cash Flow goals were established at the corporate level and at each division. No bonus is payable with respect to a performance factor if the performance is below the minimum goal. Performance above the maximum level would not result in any increase in bonus.

        The following table sets forth for fiscal year 2010, the minimum threshold goals (below which no bonuses based on the corresponding factor would be paid) and the maximum goals (above which no bonuses based on the corresponding factor would be paid), for Company Adjusted EBITDA and

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Adjusted Operating Cash Flow as well as the Company's actual performance for the year (dollars in millions).

Performance Factor	Minimum Threshold		Maximum Threshold		Actual Performance
Corporate Adjusted EBITDA	$	54.0	$	66.0	$	61.6
Corporate Adjusted Op. Cash Flow		43.0		53.0		55.4

        In calculating Adjusted EBITDA for fiscal year 2010, the Company excluded the following non-recurring and non-cash items: $19.9 million of strategic alternative transaction expenses and $3.0 million of stock-based compensation expense. The base salary used for each executive was: Mr. Caldarelli C$550,000 Canadian, Mr. Littman $300,000, Mr. Fickett $350,000, Mr. Tafler C$198,000 Canadian, and Mr. Coleman $202,000.

        The award for Mr. Caldarelli, our chief executive officer, provided that his bonus would be weighted as follows: 40% on Adjusted EBITDA for the Company as a whole, 40% on Adjusted Operating Cash Flow for the Company as a whole, 10% on Adjusted EBITDA for the Communications & Medical Products ("CMP") Division (of which he is the president) and 10% on Adjusted Operating Cash Flow for the CMP Division. His bonus would be 30% of his base salary (as of the end of the fiscal year) on achievement of the minimum thresholds and 210% of his base salary on achievement of the maximum levels of Adjusted EBITDA and Adjusted Operating Cash Flow, with percentages interpolated for other levels of Adjusted EBITDA or Adjusted Operating Cash Flow.

        For fiscal year 2010, the CMP Division's actual Adjusted EBITDA and actual Adjusted Operating Cash Flow were above the maximum thresholds. As a result the maximum bonus was payable with respect to the operating results of the CMP Division.

        The award for Mr. Fickett, our chief operating officer and president, provided that his bonus would be weighted as follows: 25% on Adjusted EBITDA for the Company as a whole, 25% on Adjusted Operating Cash Flow for the Company as a whole, 25% on Adjusted EBITDA for the Microwave Power Products ("MPP") Division (of which he is the president) and 25% on Adjusted Operating Cash Flow for the MPP Division. His bonus would be 22.5% of his base salary (as of the end of the fiscal year) on achievement of the minimum thresholds and 168.75% of his base salary on achievement of the maximum levels of Adjusted EBITDA or Adjusted Operating Cash Flow, with percentages interpolated for other levels of Adjusted EBITDA or Adjusted Operating Cash Flow.

        For fiscal year 2010, the MPP Division's actual Adjusted EBITDA and actual Adjusted Operating Cash Flow exceeded the maximum thresholds. As a result the maximum bonus was payable with respect to the operating results of the MPP Division.

        The award for Mr. Littman, our chief financial officer, treasurer and secretary, provided that his bonus would be weighted as follows: 50% on Adjusted EBITDA for the Company as a whole and 50% on Adjusted Operating Cash Flow for the Company as a whole. His bonus would be 15% of his base salary (as of the end of the fiscal year) on achievement of the minimum thresholds and 120% of his base salary on achievement of the maximum levels of Adjusted EBITDA or Adjusted Operating Cash Flow, with percentages interpolated for other levels of Adjusted EBITDA or Adjusted Operating Cash Flow.

        The award for Mr. Coleman, vice president, provided that his bonus would be weighted as follows: 25% on Adjusted EBITDA for the Company as a whole, 25% on Adjusted Operating Cash Flow for the Company as a whole, 25% on Adjusted EBITDA for the Beverly Microwave Division ("BMD Division") (of which he is the president) and 25% on Adjusted Operating Cash Flow for the BMD Division. His bonus would be 15.0% of his base salary (as in effect as of the end of the fiscal year) on achievement of the minimum thresholds and 112.5% of his base salary on achievement of the maximum

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levels of Adjusted EBITDA or Adjusted Operating Cash Flow, with percentages interpolated for other levels of Adjusted EBITDA or Adjusted Operating Cash Flow.

        For fiscal year 2010, the BMD Division's actual Adjusted EBITDA and Adjusted Operating Cash Flow were below the respective thresholds. As a result, no bonus was payable with respect to the operating results of the BMD Division.

        The award for Mr. Tafler, vice president, provided that his bonus would be weighted as follows: 25% on Adjusted EBITDA for the Company as a whole, 25% on Adjusted Operating Cash Flow for the Company as a whole, 25% on Adjusted EBITDA for the Satcom Division (of which he is the president) and 25% on Adjusted Operating Cash Flow for the Satcom Division. His bonus would be 15.0% of his base salary (as of the end of the fiscal year) on achievement of the minimum thresholds and 112.5% of his base salary on achievement of the maximum levels of Adjusted EBITDA or Adjusted Operating Cash Flow, with percentages interpolated for other levels of Adjusted EBITDA or Adjusted Operating Cash Flow.

        For fiscal year 2010, the Satcom Division's actual Adjusted EBITDA and Adjusted Operating Cash Flow were above the respective maximum thresholds. As a result the maximum bonus was payable with respect to the operating results of the Satcom Division.

        The Management Incentive Plan provided that total aggregate bonus payments under the MIP for fiscal year 2010 would not exceed 8% of Adjusted EBITDA. For fiscal year 2010, the bonuses actually paid under the MIP did not approach this limit.

        Except in the case of scheduled retirement, death or disability or as otherwise provided in an employee's employment agreement, to be eligible for a bonus award, an executive officer must be on the payroll in good standing at the end of the fiscal year and at the time of payment. Payments were distributed on January 14, 2011 for U.S. executive officers, and on January 13, 2011 for Canadian executive officers. In the event of scheduled retirement, death or disability, a pro rata payment will be made to the executive officer or the executive officer's estate.

Outstanding Equity Awards at October 1, 2010

        The following table provides information concerning unexercised options for each named executive officer outstanding as of the end of the fiscal year 2010. Under the terms of the Merger Agreement, all outstanding stock options and stock awards (other than certain stock awards and stock options granted during the 2011 fiscal year) vested upon the consummation of the Merger.

			Option Award(1)									Stock Award(2)
Name	Grant Date		Number of Securities Underlying Unexercised Options: Exercisable (#)		Number of Securities Underlying Unexercised Options: Unexercisable (#)			Option Exercise Price ($)		Option Expiration Date		Number of Shares or Units of Stock That have Not Vested (#)			Market Value of Shares or Units of Stock That Have not Vested ($)
O. Joe Caldarelli		12/8/09				36,000	(3)	$	9.66		12/8/19		12,000	(4)	$	169,440
		12/5/08		4,500		31,500	(5)		10.00		12/5/18		10,500	(6)		148,260
		12/10/07											6,000	(7)		84,720
		11/30/07		15,000		15,000	(8)		16.79		11/30/17
		12/08/06		33,750		11,250	(9)		14.22		12/8/16
		4/27/06		33,750		11,250	(10)		18.00		4/27/16
		9/29/04		43,584					4.32		9/29/14
		9/29/04		10,896					6.61		9/29/14
		3/01/04		517,566					4.32		3/01/14
		2/03/04		7,411					1.08		2/03/14
		3/10/03		272,403					0.20		3/10/13

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			Option Award(1)									Stock Award(2)
Name	Grant Date		Number of Securities Underlying Unexercised Options: Exercisable (#)		Number of Securities Underlying Unexercised Options: Unexercisable (#)			Option Exercise Price ($)		Option Expiration Date		Number of Shares or Units of Stock That have Not Vested (#)			Market Value of Shares or Units of Stock That Have not Vested ($)
Joel A. Littman		12/8/09				18,000	(3)	$	9.66		12/8/19		6,000	(4)	$	84,720
		12/5/08		2,250		15,750	(5)		10.00		12/5/18		5,250	(6)		74,130
		11/30/07		7,500		7,500	(8)		16.79		11/30/17		3,000	(7)		42,360
		12/08/06		16,500		5,500	(9)		14.22		12/8/16
		4/27/06		16,500		5,500	(10)		18.00		4/27/16
		9/29/04		34,866					4.32		9/29/14
		9/29/04		8,718					6.61		9/29/14
		3/01/04		163,442					4.32		3/01/14
		3/10/03		81,721					0.20		3/10/13
		7/02/01		12,257					0.74		7/02/11
Robert A. Fickett		12/8/09				24,000	(3)	$	9.66		12/8/19		8,000	(4)	$	112,960
		12/5/08		3,000		21,000	(5)		10.00		12/5/18		7,000	(6)		98,840
		11/30/07		10,000		10,000	(8)		16.79		11/30/17		4,000	(7)		56,480
		12/08/06		22,500		7,500	(9)		14.22		12/8/16
		4/27/06		22,500		7,500	(10)		18.00		4/27/16
		9/29/04		43,584					4.32		9/29/14
		9/29/04		10,896					6.61		9/29/14
		3/01/04		299,644					4.32		3/01/14
		3/10/03		163,442					0.20		3/10/13
Andrew E. Tafler		12/8/09				12,000	(3)	$	9.66		12/8/19		4,000	(4)	$	56,480
		12/5/08		1,500		10,500	(5)		10.00		12/5/18		3,500	(6)		49,420
		12/10/07											2,000	(7)		28,240
		11/30/07		5,000		5,000	(8)		16.79		11/30/17
		12/08/06		11,250		3,750	(9)		14.22		12/8/16
		4/27/06		11,250		3,750	(10)		18.00		4/27/16
		9/29/04		21,792					4.32		9/29/14
		9/29/04		5,448					6.61		9/29/14
		6/01/04		54,480					4.32		6/01/14
		3/01/04		17,976					4.32		3/01/14
Don C. Coleman		12/8/09				12,000	(3)	$	9.66		12/8/19		4,000	(4)	$	56,480
		12/5/08		1,500		10,500	(5)		10.00		12/5/18		3,500	(6)		49,420
		11/30/07		5,000		5,000	(8)		16.79		11/30/17		2,000	(7)		28,240
		12/08/06		11,250		3,750	(9)		14.22		12/8/16
		4/27/06		11,250		3,750	(10)		18.00		4/27/16
		9/29/04		21,792					4.32		9/29/14
		9/29/04		5,448					6.61		9/29/14
		3/01/04		81,720					4.32		3/01/14
		3/10/03		38,681					0.20		3/10/13

(1)

An aggregate of 1,160,180 options, or 47.1% of the options included in the table, were issued prior to the Company's initial public offering. They were issued either through grants of options made prior to the January 2004 acquisition of the Company by affiliates of The Cypress Group that were not cashed out in connection with that acquisition and were "rolled over" as an investment into the acquired company or through grants made as an adjustment to compensate option holders for not participating in a 2005 $75.8 million special distribution to stockholders.

(2)

The market value of shares or units of stock that have not yet vested is based on $14.12, which was the Company's closing stock price on October 1, 2010.

(3)

One-fourth of the shares subject to this option award vest on December 8 of each of 2010, 2011, 2012 and 2013.

(4)

Shares in this stock award are subject to both time-vesting and performance-vesting conditions. All of such options are broken up into four tranches (each a "Tranche"), each consisting of one-fourth of the unvested options. The

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unvested options in each Tranche become fully vested only if both the time-vesting conditions (described below) and the performance-vesting conditions (described below) are satisfied with respect to such unvested options. The time-vesting conditions are satisfied at a rate of 25% per year based on continued employment over a four-year period. The performance-vesting conditions are based on the achievement of specified Adjusted EBITDA levels achieved by the Company:

a)

Year 1, the first Tranche will vest at 100% if Adjusted EBITDA at or over $60 million; at 50% if Adjusted EBITDA at $50 million; zero if Adjusted EBITDA below $50 million; and straight-line between points.



b)

Year 2, the second Tranche will vest at 100% if Adjusted EBITDA at or over $63 million; at 50% if Adjusted EBITDA at $52.5 million; zero if Adjusted EBITDA below $52.5 million; and straight-line between points;



c)

Year 3, the second Tranche will vest at 100% if Adjusted EBITDA at or over $66.2 million; at 50% if Adjusted EBITDA at $55.1 million; zero if Adjusted EBITDA below $55.1 million; and straight-line between points;



d)

Year 4, the second Tranche will vest at 100% if Adjusted EBITDA at or over $69.5 million; at 50% if Adjusted EBITDA at $57.9 million; zero if Adjusted EBITDA below $57.9 million; and straight-line between points;

(5)

Shares in this option award are subject to both time-vesting and performance-vesting conditions. All of such options are broken up into two tranches (each a "Tranche"). Tranche One and Tranche Two each consist of one-half of the unvested options. The unvested options in each Tranche become fully vested only if both the time-vesting conditions (described below) and the performance-vesting conditions (described below) are satisfied with respect to such unvested options. The time-vesting conditions are satisfied at a rate of 25% per year based on continued employment over a four-year period. The performance-vesting conditions are based on the achievement of specified average price thresholds by the Company's common stock, with a $13.50 stock price threshold for Tranche One and a $16.00 stock price threshold for Tranche Two. As of October 1, 2010, the $13.50 stock price threshold has been met.

(6)

Shares in this stock award are subject to both time-vesting and performance-vesting conditions. All of such shares are broken up into two tranches (each a "Tranche"). Tranche One and Tranche Two each consist of one-half of the unvested shares. The unvested shares in each Tranche become fully vested only if both the time-vesting conditions (described below) and the performance-vesting conditions (described below) are satisfied with respect to such unvested shares. The time-vesting conditions are satisfied at a rate of 25% per year based on continued employment over a four-year period. The performance-vesting conditions are based on the achievement of specified average price thresholds by the Company's common stock, with a $13.50 stock price threshold for Tranche One and a $16.00 stock price threshold for Tranche Two. As of October 1, 2010, the $13.50 stock price threshold has been met.

(7)

Half of the unvested shares subject to this stock award vest on November 30 of each of 2010 and 2011.

(8)

Half of the unvested shares subject to this option award vest on November 30 of each of 2010 and 2011.

(9)

The unvested shares subject to this option award vested on December 8, 2010.

(10)

The unvested shares subject to this option award vest on April 27, 2011.

Option Exercises and Stock Vested for Fiscal Year 2010

	Option Award				Stock Awards
Name of Executive	Number of Shares Acquired on Exercise (#)		Value Realized on Exercise ($)		Number of Shares Acquired on Vesting (#)		Value Realized on Vesting ($)
O. Joe Caldarelli		—		—		4,500	$	51,990
Joel A. Littman		—		—		2,250		25,995
Robert A. Fickett(1)		27,583	$	354,530		3,000		34,660
Andrew E. Tafler		—		—		1,500		17,330
Don C. Coleman(1)		27,240	$	354,897		1,500		17,330

(1)

Options involved were scheduled to expire before the end of July 2010. The shares acquired upon exercise were sold by Mr. Fickett and Mr. Coleman under Rule 10b5-1 trading plans.

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Pension Benefits

Name	Plan Name	Number of Years Credited Service (#)		Present Value of Accumulated Benefit ($)(1)		Payments During Last Fiscal Year ($)
O. Joe Caldarelli	Pension Plan for Executive Employees of Communications & Power Industries Canada Inc. (as applicable to O. Joe Caldarelli)		31	$	1,140,469		—

(1)

Amounts are denominated in Canadian Dollars and were converted to U.S. Dollars using an exchange rate as of October 1, 2010 of approximately US$0.97 for C$1.00.

Narrative Disclosure to Pension Benefits Table

        In December 2002, Communications & Power Industries Canada Inc., a subsidiary of the Company, adopted a defined benefit pension plan for its chief executive officer, O. Joe Caldarelli. Communications & Power Industries Canada Inc., Mr. Caldarelli's employer, is the administrator of the plan. The amount of annual pension payable to Mr. Caldarelli at age 65, which is the normal retirement age as defined in the plan, is equal to: (i) 2% of the average of Mr. Caldarelli's highest average indexed earnings for each year of pensionable service before December 31, 1990 plus (ii) the aggregate of 2% of Mr. Caldarelli's indexed earnings for each year of pensionable service on or after January 1, 1991. In effect, under current Canadian regulations, as of the end of December 2010 the annual pension amount would be limited to C$2,494.44 per year of pensionable service. As used above and defined in the plan, "earnings" refers to salary, commissions, bonus and profit sharing; "pensionable service" (subject to exceptions for certain temporary absences) refers to the number of years and completed months of continuous service in Canada with the employer and all pensionable service recognized under The Retirement Plan of Communications & Power Industries Canada Inc. (the predecessor plan), "indexed earnings" means, for any given calendar year, the earnings adjusted to the date of calculation (which is the earliest date of retirement, termination of employment, date of death or termination of the plan) to reflect increases after the year in the average weekly wages and salaries of the Industrial Aggregate as published by Statistics Canada, and "highest average indexed earnings" means the average of the highest three years of indexed earnings preceding any date of calculation. Amounts payable to Mr. Caldarelli under the plan cannot exceed the maximum pension limits under the Canadian Income Tax Act. Under current Canadian regulations, Mr. Caldarelli would have been entitled to a maximum pension of C$77,328 per year if he had retired at the end of December 2010.

        The pension paid under the plan will be increased annually on January 1 of each year, beginning the January 1 after the date of commencement of payment of the pension, based on the average rate of increase in the Canada all-items Consumer Price Index as published by Statistics Canada, during the previous calendar year (or part of the year) in respect of which payments were made, less 1%. If the annual pension benefit payable at normal retirement age is less than 2% of the yearly maximum pensionable earnings, as defined in the plan, for the calendar year in which Mr. Caldarelli retires, dies or his employment terminates, then a lump sum of the commuted value (as described in the plan) will be paid instead.

        Pension payments will generally begin on the date that Mr. Caldarelli actually retires and will be paid in equal monthly installments of one-twelfth of the annual amount. If Mr. Caldarelli does not have a spouse at the time that the pension commences to be paid, then the pension payments will cease with the last payment due before his death or after 180 monthly payments have been made, whichever is later. If Mr. Caldarelli were to die before said 180 monthly payments had been made, then the

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commuted value (as described in the plan) of the remaining payments would be paid to his beneficiary, in one lump sum. If Mr. Caldarelli has a spouse at the time that the pension commences to be paid, then pension payments will be made throughout Mr. Caldarelli's lifetime for a minimum of 60 monthly payments, with the provision that after his death, or after 60 monthly payments have been made (whichever is later), pension payments will continue to his spouse throughout his spouse's lifetime at the rate of 66.67% of his pension. If he were to die before the minimum of 60 monthly payments had been made, then such payments will continue in full to the surviving spouse until the balance of the 60 monthly payments has been made and will then be reduced to 66.67%. If his spouse were also to die before the minimum of 60 monthly payments had been made, then the commuted value (as described in the plan) of the remaining payments would be paid to Mr. Caldarelli's estate, in one lump sum. Notwithstanding the foregoing, Mr. Caldarelli's spouse is entitled to waive her entitlement to receive payment of the pension under the plan, and in such event, Mr. Caldarelli will be deemed to not have a spouse for purposes of the plan at the time that the pension commences. Because Mr. Caldarelli is married, he has the option of electing a reduced amount of pension payment during his lifetime, with the provision that after his death, payment will continue as follows during the lifetime of his spouse if his spouse is then living: (i) in full without a guaranteed period or with a guaranteed period from commencement date of the pension of 60, 120 or 180 monthly payments or (ii) reduced to 66.67% with a guaranteed period from the commencement of the pension of 120 or 180 monthly payments.

        Under the plan, Mr. Caldarelli is permitted to retire early, on the first of any month within 10 years of his normal retirement date, and Mr. Caldarelli is therefore currently eligible for early retirement under the plan. The amount payable at early retirement is the lesser of (i) the actuarial equivalent (determined on the basis of mortality tables, rates of interest and rules adopted from time to time by the employer for this purpose on recommendation of the actuary) of the pension accrued to the date of early retirement and otherwise payable from the normal retirement date and (ii) the pension accrued to the date of early retirement and otherwise payable from the normal retirement date, reduced by the early retirement reduction factor prescribed by Income Tax Regulation 8503(3)(c) under the Canadian Income Tax Act.

        Under the plan, if Mr. Caldarelli remains in service after his normal retirement age, he may delay receipt of his pension to the earlier of (i) the first day of the month coinciding with or following his actual retirement date and (ii) the first day of the month before the calendar year of his 69th birthday. The amount of pension payable at late retirement will be the sum of (a) the actuarial equivalent (determined as described above) of the pension accrued to his normal retirement date plus (b) the pension accrued (as calculated pursuant to the first paragraph) to the date of late retirement for each year, or part of a year, of pensionable service after his normal retirement date.

        Upon termination of employment prior to normal retirement age, Mr. Caldarelli will receive a deferred pension payable from the normal retirement age in the normal form described in the plan. The amount of deferred pension will equal the amount of pension otherwise accrued under the plan to the date of termination. In addition, upon termination of employment (or wind-up of the plan), he is entitled to receive an early retirement pension, as described above. If Mr. Caldarelli dies while employed prior to commencement of the deferred pension payments to which he would have been entitled had his employment terminated immediately before his death, his surviving spouse may elect a lump sum payment equal to the commuted value (as described in the plan) of the deferred pension or an immediate or deferred pension payable in equal monthly installments, the present value of which does not exceed the present value of the deferred pension, payable throughout the spouse's lifetime without a guaranteed period or with a guaranteed period not in excess of 180 monthly payments.

        The plan may be amended or discontinued by the employer, and in such event, the benefits provided prior to the date of amendment will not be adversely affected. Replacement of the plan by another plan will be considered an amendment. If the plan is discontinued, the assets will be allocated to provide the pensions and benefits according to the plan.

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        The employer will pay into the plan in monthly installments within 30 days after the month for which contributions are payable, the amounts deemed to be employer-eligible contributions. An employer-eligible contribution is a contribution made by the employer to the plan that is a prescribed contribution or complies with prescribed conditions per applicable legislation and is made pursuant to the recommendation of the actuary. The employer is required to establish a pension fund into which all contributions will be deposited. The pension fund is not part of the revenue or assets of the employer. Accordingly, payments to be made under the plan will be made from the balance in the pension fund and from the general assets of the employer.

        The method of valuation for determining the present value of the accumulated benefit is based on the following assumptions:

	From 10/2/09 to 10/01/10	From 10/3/08 to 10/02/09	From 9/28/07 to 10/03/08
Mortality table	80% GAM-1983 (50% male/50% female)	80% GAM-1983 (50% male/50% female)	80% GAM-1983 (50% male/50% female)
Expected rate of return on plan assets	7.5%	7.5%	7.5%
Discount rate of liabilities at the beginning of the year	5.75%	5.75%	5.50%
Discount rate of liabilities at the end of the year	4.75%	5.75%	5.75%
Rate of salary increase	4.00%	4.00%	4.00%
Rate of increase of monthly pension unit	3.00%	3.00%	3.00%
Average remaining service period of active employees	6.16	7.16	8.16
Age at retirement	65	65	65

Non-qualified Deferred Compensation

Name	Executive Contributions in Last Fiscal Year		Registrant Contributions in Last Fiscal Year(1)		Aggregate Earnings in Last Fiscal Year(2)		Aggregate Withdrawals/ Distributions		Aggregate Balance at Last Fiscal Year End
Joel A. Littman		—	$	10,723	$	7,617	$	—	$	66,061
Robert A. Fickett	$	48,222		15,500		10,889		—		195,992
Don C. Coleman		15,461		4,322		6,534		—		60,254

(1)

Amounts reported in this column are also included in the Summary Compensation Table in the "All Other Compensation" column.

(2)

Amounts reported in this column are not considered as "above market or preferential earnings" under Securities and Exchange Commission Rules and are therefore not included in the Summary Compensation Table.

Narrative Disclosure to Non-qualified Deferred Compensation Table

        The Company adopted the Communications & Power Industries, Inc. Non-qualified Deferred Compensation Plan (the "Original Plan") in 1995, and in 2004 adopted the First Amendment and Restatement of the Communications & Power Industries, Inc. Non-qualified Deferred Compensation Plan (the "Restated Deferred Compensation Plan"). The Restated Deferred Compensation Plan

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provides for the deferral of income on a pre-tax basis for a select group of the Company's management and highly compensated employees and is administered by the Compensation Committee of the Board of Directors of the Company. Participation in the Restated Deferred Compensation Plan is limited to employees who are (i) a select group of management or highly compensated employees, as defined by the Employee Retirement Income Security Act of 1974 (ERISA), and (ii) designated as such by the plan administrator. The Restated Deferred Compensation Plan first applied to elections made by participating employees to defer compensation earned or vested after December 31, 2004. The provisions of the Original Plan will remain in effect for deferrals of compensation that was earned and vested before January 1, 2005.

        Under the Restated Deferred Compensation Plan, generally, a participating employee may elect in December of each year to defer up to 100% of his or her salary and Management Incentive Plan bonus for the next calendar year (subject to reduction to facilitate compliance with applicable withholding requirements). The Company makes contributions during each calendar year for the benefit of each participant equal to the sum of (1) 4.75% of the participant's base salary paid in such calendar year in excess of the Social Security taxable wage base in effect for such year, up to and including the dollar limit set forth in Section 401(a)(17) of the Internal Revenue Code, plus (2) 9.5% of the participant's base salary paid in such calendar year in excess of the dollar limit in Section 401(a)(17) of the Internal Revenue Code.

        A participant's account will be credited with such participant's deferred compensation, the Company's contributions for such participant and any investment earnings, gains, losses or changes in value (from time to time, as provided in the Restated Deferred Compensation Plan). The administrator will keep a sub-account within the account of each person who was a participant before the effective date of the Restated Deferred Compensation Plan to reflect (i) the portion of the account attributable to deferred compensation amounts and Company contributions that were earned and vested before January 1, 2005 (which will continue to be governed by the provisions of the Original Plan) and (ii) the portion of the account attributable to deferred compensation amounts and Company contributions that were earned or vested after December 31, 2004 (which will be governed by the provisions of the Restated Deferred Compensation Plan). A participating employee is at all times fully vested in his or her account balance.

        Investment elections may be made from the various investment alternatives selected by a participant from those made available by the Company from time to time. A participant may elect to have his or her account deemed invested in up to 10 investment alternatives, provided that an investment alternative must be applied to at least 10% of the total balance in the account and must be in a whole percentage amount. Notwithstanding the foregoing, the Company may invest contributions in investments other than the investments selected by the participant; however the participant's return will be based on the results of his or her investment election (reduced for expenses as provided in the Restated Deferred Compensation Plan).

        In the event of a participant's disability or termination of employment for any reason, including retirement or death, the Company will pay the participant a termination benefit equal to the balance of the participant's account in one lump sum within 2.5 months after the disability or termination of employment, provided that if stock of the Company is publicly traded on an established securities market (or otherwise), no payment will be made to a key employee (as defined in Section 416(i) of the Internal Revenue Code without regard to paragraph 5 of such section) of the Company or one of its affiliates within six months after such person's separation from service (or the date of death, if earlier). In the event of a participant's death before payment of the benefits pursuant to the preceding sentence, a death benefit equal to the balance in the participant's account will be paid to the participant's beneficiary in one lump sum within 2.5 months after the participant's death. If the plan administrator, upon written request of a participant, determines in its sole discretion that the participant has suffered an unforeseeable financial emergency (as described in the Restated Deferred Compensation Plan), then

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the Company will pay the participant an amount necessary to meet the emergency in accordance with the provisions and subject to the limitations of the Restated Deferred Compensation Plan.

        The Board of Directors may terminate, amend or modify the Restated Deferred Compensation Plan, subject to certain limitations set forth in the Restated Deferred Compensation Plan and applicable law. If the Restated Deferred Compensation Plan is terminated, (a) the portion of the participant's account attributable to deferred compensation and Company contributions that were earned and vested before January 1, 2005 will be distributed in one lump sum and (b) the portion of the participant's account attributable to deterred compensation and Company contributions that are earned or vested after December 31, 2004 will be distributed as and when such portion of the account would have been distributed if the plan had not terminated. The Restated Deferred Compensation Plan is intended to comply with the provisions of Internal Revenue Code Section 409A as enacted by the American Jobs Creation Act of 2004.

        As with all non-qualified deferred compensation plans, a participating employee's rights against the Company to receive the deferred amounts are limited to the rights of an unsecured general creditor. The Company's obligation to pay benefits under the Original Plan and the Restated Deferred Compensation Plan is not backed by any security interest in the Company's assets to assure payment of the deferred amounts.

Potential Payments upon Termination or Change in Control

Agreements Providing for Payments upon Termination or Change in Control

Employment Agreements

        The employment agreements with Messrs. Caldarelli, Fickett, Littman, Tafler and Coleman could require the Company (or the applicable subsidiary) to make certain payments to those executive officers in connection with certain terminations of their employment, including in connection with a termination following a change of control of the Company. These agreements are described above under "Narrative Disclosure to Summary Compensation Table and Grants of Plan-based Awards Table—Employment Agreements."

Stock Option Agreements

2006 Equity and Performance Incentive Plan

        Stock option agreements between the Company and Messrs. Caldarelli, Fickett and Littman for options granted to those executive officers under the 2006 Plan provide that upon termination of the executive officer's employment with the Company (or the applicable subsidiary) for cause or for any reason other than death, disability, termination by the executive officer for good reason or discharge of the executive officer without cause, all options will immediately cease vesting. Upon termination of the executive officer's employment with the Company (or the applicable subsidiary) without cause, as a result of death or disability or by the executive officer for good reason, all unvested options for the executive officer will become fully vested and exercisable as of the date of termination. In the event of termination of the executive officer's employment by death or disability, by the Company (or the applicable subsidiary) without cause or by the executive officer for good reason, the options will be exercisable for a period ending on the earlier of (a) 12 months after the termination date and (b) the date that is 10 years after the date of grant of the applicable option, and will, if unexercised after such period, be cancelled and terminated.

        In the event of termination of employment by the executive officer without good reason, unvested options will immediately be cancelled and terminated, and vested options will be exercisable for a period ending on the earlier of (a) 90 days after termination of employment or, if the executive officer reasonably determines that he is prohibited or restricted from selling the shares in the public markets

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for any portion of such 90-day period, then 90 days after all restrictions cease, and (b) the date that is 10 years after the date of grant of the applicable option, and will, if unexercised after such period, be cancelled and terminated. Stock option agreements between the Company and each of Messrs. Coleman and Tafler for options granted to those executive officers under the 2006 Plan provide that upon termination of the executive officer's employment with the Company (or the applicable subsidiary) other than for death or disability, the options will immediately cease vesting. Upon termination of the executive officer's employment with the Company (or the applicable subsidiary) for any reason other than cause, death or disability, unvested options will immediately be cancelled and terminated, and vested options will be exercisable for a period ending on the earlier of (a) 90 days after the termination date and (b) the date that is 10 years after the date of grant of the applicable option, and will, if unexercised after such period, be cancelled and terminated. Upon termination of the executive officer's employment as a result of death or disability, if the termination date does not fall on an anniversary of the date of grant of the options, then for purposes of determining the extent to which the options have vested, the executive officer's employment will be deemed terminated on the next occurring anniversary of the date of grant. Upon termination as a result of death or disability, unvested options will immediately be cancelled and terminated, and vested options will be exercisable for a period ending on the earlier of (a) 12 months after the termination date and (b) the date that is 10 years after the date of grant of the applicable option, and will, if unexercised after such period, be cancelled and terminated.

        Stock option agreements between the Company and all of the named executive officers under the 2006 Plan provide that if an executive officer's employment is terminated for cause, then all of his vested and unvested options will be cancelled and terminated as of the date of such termination and will no longer be exercisable as to any shares. In addition, in connection with a merger, reorganization or similar transaction in which the Company is not the surviving entity, if the obligations of the options are not assumed by the surviving entity or if the Company fails to provide the executive officer with cash or property equal to the spread value of the options (aggregate fair market value of the shares subject to the options less the aggregate exercise price of the options), then the unvested options will become fully vested and exercisable prior to the effective date of such transaction. In addition, if, in connection with a change-of-control transaction, the Company's common stock is converted into cash, securities or other property or the Company's common stock is no longer publicly traded, the performance conditions shall no longer apply to options or restricted stock subject to performance conditions based on the Company's stock price.

2004 Stock Incentive Plan

        Stock option agreements between the Company and each of Messrs. Caldarelli, Fickett, Littman, Tafler and Coleman for options granted to those executive officers under the 2004 Stock Incentive Plan provide that, upon termination of employment with the Company (or the applicable subsidiary), any unvested options will be immediately cancelled. In the case of termination of employment as a result of death or disability, the portion of the option that was scheduled to vest on the next vesting date will become immediately vested. Upon termination as a result of death or disability, vested options will be exercisable for a period of one year after the termination date (or if earlier, the date that is 10 years after the date of grant of the applicable option), and will, if unexercised after such period, be cancelled and terminated. Upon termination of the executive officer's employment without cause or upon termination of his employment by the executive officer, vested options will be exercisable for a period of 90 days after the termination date (or if earlier, the date that is 10 years after the date of grant of the applicable option), and will, if unexercised after such period, be cancelled and terminated. If the executive officer's employment is terminated for cause, then all vested options will be cancelled and terminated as of the date of such termination and will no longer be exercisable as to any shares.

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        As described in "—Equity Treatment in Connection with the Merger" all outstanding stock options and stock awards (other than certain stock options and stock awards granted during the 2011 fiscal year) vested upon the consummation of the Merger and all stock options and stock awards were cancelled in connection with the Merger.

Calculation of Potential Payments upon Termination or Change in Control

        The following table presents the Company's estimate of the benefits payable to the named executive officers under the agreements described above in connection with certain terminations of their employment with the Company or its subsidiaries, including those in connection with a change in control. In calculating the amount of any potential payments to the named executive officers, the Company has assumed that the applicable triggering event (i.e., termination of employment) occurred on October 1, 2010, and that the price per share of the Company's common stock is equal to $14.12, the closing market price per share on October 1, 2010, the last trading day in fiscal year 2010.

Name	Compensation Element(3)	Termination Other than for Cause and Resignation for Good Reason— Not in Connection with Change of Control			Termination Other than for Cause and Resignation for Good Reason— In Connection with Change of Control			Termination for Cause or Resignation Other than for Good Reason		Death or Disability
O. Joe Caldarelli(1)	Base Salary	$	1,071,081	(4)	$	1,338,851	(10)		—	$	—
	Performance Bonus		2,227,887	(5)		3,520,020	(11)		—		1,002,980	(14)
	Acceleration of Equity Awards		692,760	(6)		692,760	(6)		—		692,760	(15)
	Continuation of Benefits		271,347	(7)		339,183	(12)		—		—
	Total	$	4,263,075		$	5,890,814				$	1,695,740
Joel A. Littman	Base Salary	$	450,000	(4)	$	600,000	(10)		—	$	—
	Performance Bonus		587,461	(5)		931,500	(11)		—		231,583	(14)
	Acceleration of Equity Awards		346,380	(6)		346,380	(6)		—		346,380	(15)
	Continuation of Benefits		92,910	(7)		123,880	(12)		—		—
	280G Tax Gross-Up		—			—	(13)		—		—
	Total	$	1,476,751		$	2,001,760				$	577,963
Robert A. Fickett	Base Salary	$	525,000	(4)	$	700,000	(10)		—	$	—
	Performance Bonus		1,055,469	(5)		1,663,593	(11)		—		219,709	(14)
	Acceleration of Equity Awards		461,840	(6)		461,840	(6)		—		187,500	(15)
	Continuation of Benefits		106,111	(7)		141,481	(12)		—		—
	280G Tax Gross-Up		—			—	(13)		—		—
	Total	$	2,148,420		$	2,966,914				$	407,209
Andrew E. Tafler(1)(2)	Base Salary	$	192,795	(4)	$	192,795	(10)		—	$	—
	Performance Bonus		202,864	(8)		202,864	(8)		—		—
	Acceleration of Equity Awards		—			—			—		81,340	(15)
	Continuation of Benefits		42,581	(7)		42,581	(12)		—		—
	Outplacement Services		15,000	(9)		15,000	(9)		—		—
	Total	$	453,240		$	453,240				$	81,340
Don C. Coleman(2)	Base Salary	$	202,000	(4)	$	202,000	(10)		—	$	—
	Performance Bonus		87,113	(8)		87,113	(8)		—		—
	Acceleration of Equity Awards		—			—			—		81,340	(15)
	Continuation of Benefits		53,363	(7)		53,363	(12)		—		—
	Outplacement Services		15,000	(9)		15,000	(9)		—		—
	Total	$	357,476		$	357,476				$	81,340

(1)

Section 280G tax gross-up amounts should not apply to Mr. Caldarelli or Mr. Tafler, as they receive no U.S.-source income from the Company.

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(2)

Mr. Coleman and Mr. Tafler are not entitled to receive the benefits described in this table in the event of a voluntary termination of employment (whether or not for good reason).

(3)

Excludes any payments to be received upon termination of employment in connection with the non-qualified deferred compensation plan described above under "—Narrative Disclosure to Non-qualified Deferred Compensation Table" and the pension plan described above under "—Narrative Disclosure to Pension Benefits Table."

(4)

The amounts shown represent two years, 1.5 years, 1.5 years, one year and one year, respectively, of Mr. Caldarelli's, Mr. Fickett's, Mr. Littman's, Mr. Tafler's and Mr. Coleman's annual base salary (as applicable) as in effect on October 1, 2010. For Mr. Caldarelli and Mr. Tafler, salary amounts are denominated in Canadian Dollars and were converted to U.S. Dollars using an exchange rate as of October 1, 2010 of approximately US$0.97 for C$1.00.

(5)

The amounts shown represent (i) the amount of the Management Incentive Plan awards that would have been payable to Mr. Caldarelli, Mr. Littman and Mr. Fickett, as applicable, for fiscal year 2010 plus (ii) the average value of the amount paid under the Company's MIP for fiscal years 2008, 2009 and 2010 (A) to Mr. Caldarelli, multiplied by two, (B) to Mr. Fickett multiplied by 1.5 and (C) to Mr. Littman multiplied by 1.5. For Mr. Caldarelli, amounts are denominated in Canadian Dollars and were converted to U.S. Dollars using an exchange rate as of October 1, 2010 of approximately US$0.97 for C$1.00.

(6)

The amounts shown represent the portion of Mr. Caldarelli's, Mr. Fickett's and Mr. Littman's unvested stock options and awards as of October 1, 2010 and are based on the intrinsic value of the stock options and awards as of such date. This was calculated by adding the product of (i) the difference between the closing market price of a share of the Company's common stock on October 1, 2010 ($14.12) and the applicable exercise price of the option by (ii) the assumed number of shares subject to stock options vesting on an accelerated basis on October 1, 2010 and the product of (i) $14.12 and (ii) the assumed number of share awards vesting on an accelerated basis on October 1, 2010.

(7)

The amounts shown represent the aggregate value of the continuation of certain employee benefits for two years, 1.5 years, 1.5 years, one year and one year, respectively, for Mr. Caldarelli, Mr. Fickett, Mr. Littman, Mr. Tafler and Mr. Coleman. For purposes of the calculation of these amounts, expected costs have not been adjusted for any actuarial assumptions related to mortality, likelihood that the executive will find other employment or discount rates for determining present value. For Mr. Caldarelli and Mr. Tafler, amounts are denominated in Canadian Dollars and were converted to U.S. Dollars using an exchange rate as of October 1, 2010 of approximately US$0.97 for C$1.00.

(8)

The amounts shown represent the amounts of the MIP award that would have been payable to Mr. Tafler and Mr. Coleman for fiscal year 2010. For Mr. Tafler, amounts are denominated in Canadian Dollars and were converted to U.S. Dollars using an exchange rate as of October 1, 2010 of approximately US$0.97 for C$1.00.

(9)

The amounts shown assume full outplacement services for a 12-month period with a firm providing transition support for executives.

(10)

The amounts shown represent 2.5 years, two years, two years, one year and one year, respectively, of Mr. Caldarelli's, Mr. Fickett's, Mr. Littman's, Mr. Tafler's and Mr. Coleman's annual base salary (as applicable) as in effect on October 1, 2010. For Mr. Caldarelli and Mr. Tafler, amounts are denominated in Canadian Dollars and were converted to U.S. Dollars using an exchange rate as of October 1, 2010 of approximately US$0.97 for C$1.00.

(11)

The amounts shown represent (i) the amount of the MIP awards that would have been payable to Mr. Caldarelli, Mr. Littman and Mr. Fickett, as applicable, for fiscal year 2010 plus (ii) the highest amount paid under the Company's MIP during fiscal years 2008, 2009 and 2010 (A) to Mr. Caldarelli, multiplied by 2.5, (B) to Mr. Fickett multiplied by two and (C) to Mr. Littman multiplied by two. For Mr. Caldarelli, amounts are denominated in Canadian Dollars and were converted to U.S. Dollars using an exchange rate as of October 1, 2010 of approximately US$0.97 for C$1.00.

(12)

The amounts shown represent the aggregate value of the continuation of certain employee benefits for 2.5 years, two years, two years, one year and one year, respectively, for Mr. Caldarelli, Mr. Fickett, Mr. Littman, Mr. Tafler and Mr. Coleman. For purposes of the calculation of these amounts, expected costs have not been adjusted for any actuarial assumptions related to mortality, likelihood that the executive will find other employment or discount rates for determining present value. For Mr. Caldarelli and Mr. Tafler, amounts are denominated in Canadian Dollars and were converted to U.S. Dollars using an exchange rate as of October 1, 2010 of approximately US$0.97 for C$1.00.

(13)

The calculation of the potential 280G tax gross-up amounts reflect the reimbursement that we are required to pay to Mr. Fickett and Mr. Littman due to (i) excise taxes that are imposed upon the executive as a result of a change in control, (ii) income and excise taxes imposed upon the executive as a result of our reimbursement of the excise tax amount and (iii) additional income and excise taxes that are imposed upon the executive as a result of our reimbursement of the executive for any excise or income taxes. The calculation of the potential 280G gross-up amounts are based upon a 280G excise tax rate of 20% on payments that exceed the "base amount" as defined in the income tax regulations under Internal Revenue Code Section 280G, a 35% federal income tax rate, a 1.45% Medicare tax rate and a 9.3% state income tax rate. For purposes of the 280G calculation, it is assumed that no amounts will be discounted as attributable to reasonable compensation and no value will be attributed to the executive executing a non-competition agreement.

(14)

The amounts shown represent the amount of the MIP awards that would have been payable to Messrs. Caldarelli, Littman and Fickett, as applicable, for fiscal year 2010. For Mr. Caldarelli, amounts are denominated in Canadian Dollars and were converted to U.S. Dollars using an exchange rate as of October 1, 2010 of approximately US$0.97 for C$1.00.

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(15)

The amounts shown represent the portion of Mr. Caldarelli's, Mr. Fickett's, Mr. Littman's, Mr. Tafler's and Mr. Coleman's unvested stock options and awards as of October 1, 2010 that would accelerate upon termination for death or disability, and are based on the intrinsic value of the stock options and awards as of such date. This was calculated by adding the product of (i) the difference between the closing market price of a share of the Company's common stock on October 1, 2010 ($14.12) and the applicable exercise price of the option by (ii) the assumed number of shares subject to stock options vesting on an accelerated basis on October 1, 2010 and the product of (i) $14.12 and (ii) the assumed number of share awards vesting on an accelerated basis on October 1, 2010.

Equity Compensation Plan Information

        The following table provides information as of October 1, 2010 with respect to the Company's existing equity compensation plans.

Plan Category	Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights(3)		Weighted Average Exercise Price of Outstanding Options Warrants and Rights		Number of Securities Remaining Available for Future Issuance
Equity compensation plans approved by security holders(1)		1,784,442	$	8.08		1,761,219	(4)
Equity compensation plans not approved by security holders(2)		1,744,975	$	4.40		—

(1)

Consists of the Company's 2000 Stock Option Plan and 2006 Equity and Performance Incentive Plan. Includes all nonqualified stock options and unvested restricted stock units.

(2)

Consists of the Company's 2004 Stock Incentive Plan.

(3)

An aggregate of 1,397,330 options, or 39.6% of the total outstanding options, warrants and rights, were issued prior to the Company's initial public offering. They were issued either through grants of options made prior to the January 2004 acquisition of the Company by affiliates of The Cypress Group that were not cashed out in connection with that acquisition and were "rolled over" as an investment into the acquired company or through grants made as an adjustment to compensate optionholders for not participating in a $75.8 million special distribution to stockholders in 2005.

(4)

Includes 476,536 shares available for future issuance under the Company's 2006 Employee Stock Purchase Plan.

2004 Stock Incentive Plan

        In January 2004, the Company adopted the 2004 Stock Incentive Plan (the "2004 Plan") for the purpose of recruiting and retaining key employees, directors and consultants by providing incentives through the granting of awards under the 2004 Plan. The 2004 Plan was not approved by securityholders of the Company. All awards granted under the 2004 Plan are non-qualified options to purchase common stock, and the Company has ceased making awards under the 2004 Plan. Options granted under the 2004 Plan included time-vesting options and "performance-based" vesting options. All outstanding options that were subject to "performance-based" vesting under the 2004 Plan are fully vested.

        The 2004 Plan is administered by a Committee of the Board of Directors designated by the Board (the "2004 Plan Committee"), which committee is currently the Company's Compensation Committee. The 2004 Plan Committee has discretion and power in interpreting and operating the 2004 Plan. The exercise prices of the options granted under the 2004 Plan were determined by the 2004 Plan Committee and were set forth in individual stock option agreements. No option is exercisable more than 10 years after the date of grant.

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        Generally, upon termination of employment, all unvested options under the 2004 Plan will immediately cease vesting and terminate. However, in the case of termination as a result of death or disability, the portion of the option that was scheduled to vest on the next vesting date will become immediately vested, and the remainder of the holder's unvested options under the 2004 Plan will terminate.

        If a holder's employment is terminated other than for death, disability or cause, then an optionholder's vested options under the 2004 Plan generally will remain exercisable for a 90-day period following termination (or, if earlier, the scheduled termination of the options), after which time all of the holder's unexercised options under the 2004 Plan will terminate.

        In the event of the death or disability of an optionholder, the holder's vested options will only be exercisable for the one-year period following the date of death (or, if earlier, the scheduled termination of the options). The options will terminate at the end of that period. If the employment of an optionholder is terminated for cause, then all of the holder's vested options under the 2004 Plan generally will immediately terminate and will no longer be exercisable.

        Upon a merger, reorganization or sale of substantially all of the assets of the Company or other change-of-control events specified in the 2004 Plan, the 2004 Plan Committee may, but will not be obligated to: (1) accelerate, vest or cause restrictions to lapse with respect to all or any portion of the options; (2) cancel the options for fair value, as determined in the sole discretion of the 2004 Plan Committee; (3) provide for the issuance of substitute options that will substantially preserve the otherwise applicable terms of any affected options previously granted under the 2004 Plan, as determined by the 2004 Plan Committee, in its sole discretion; or (4) provide that for a period of at least 15 days prior to the change-of-control transaction, the options will be exercisable as to all shares subject to the options and that upon the occurrence of the change of control, the options will terminate.

        In the event of any change in the outstanding shares of common stock by reason of any share dividend or split, reorganization, recapitalization, merger, consolidation, spin-off, combination or transaction or exchange of shares or other corporate exchange, any distribution to stockholders of shares (but excluding any cash distribution or dividend) or any transaction similar to the foregoing, the 2004 Plan Committee, will make equitable, proportionate and appropriate substitutions or adjustments as to (1) the number or kind of shares or other securities issued or reserved for issuance pursuant to the 2004 Plan or pursuant to outstanding awards under the 2004 Plan, (2) the exercise price of any stock option or any stock appreciation right and/or (3) any other affected terms of such awards under the 2004 Plan. The foregoing adjustments will be made by the 2004 Plan Committee, whose determination as to what adjustments will be made, and the extent thereof, will be final, binding and conclusive.

        Unless otherwise determined by the 2004 Plan Committee, an option will not be transferable or assignable by the participant other than by will or the laws of descent and distribution. An option exercisable after the death of a participant may be exercised by the legatees, personal representatives or distributes of the participant.

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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

        Holding LLC owns all of the outstanding common stock of Parent, which in turn owns all of the outstanding common stock of CPII. The Veritas Fund and its affiliates and certain members of our management beneficially own shares of our common stock indirectly through their holdings in Holding LLC. The Veritas Fund and its affiliates control Parent, and the Sponsor controls us and all of our subsidiaries through its control of the Veritas Fund and its affiliates.

        The following table sets forth information with respect to the beneficial ownership of the Class A membership interests in Holding LLC as of March 1, 2011 of: (1) each person or entity who beneficially owns 5% or more of the outstanding equity of Holding LLC; (2) each member of CPII's board of directors, the board of directors of the Parent and the board of managers of the Holding LLC; (3) each of our named executive officers and directors; and (4) all of our directors and named executive officers as a group.

        Beneficial ownership is determined in accordance with the rules of SEC. To our knowledge, each of the holders of Class A membership interests in Holding LLC listed below has sole voting and investment power as to the interests owned unless otherwise noted.

Name and Address of Beneficial Owner(1)	Percent of Class A Membership Interests(2)
The Veritas Capital Fund IV, L.P.(3)(4)		42.63	%
The Veritas Capital Fund III, L.P.(3)		30.79	%
CICPI Holdings LLC(3)		21.32	%
O. Joe Caldarelli		2.37	%
Robert A. Fickett		1.42	%
Joel A. Littman		*
John R. Beighley		*
Don C. Coleman		*
Andrew E. Tafler		*
Robert B. McKeon(3)(5)		94.74	%
Hugh Evans(3)		—
Ramzi M. Musallam(3)		—
Jeffrey P. Kelly(3)		—
All executive officers and directors as a group (10 persons)(6)		100.00	%

*

Represents less than 1% of the outstanding shares of the applicable class or series of capital stock

(1)

Except as otherwise indicated, addresses are c/o CPI International, Inc. 811 Hansen Way, Palo Alto, California 94303-1110.

(2)

Currently, Class A membership interests represent 100% of Holding LLC's equity interests. Certain members of our management may be granted Class B membership interests in Holding LLC. Pursuant to the terms of the amended and restated limited liability company agreement governing Holding LLC, holders of Class B membership interests are entitled to receive a percentage of all distributions, if any, made by Holding LLC after the holders of the Class A membership interests, including affiliates of our Sponsor, have received a return of their invested capital plus an 8% per annum internal rate of return (compounded quarterly and accruing daily) on their unreturned invested capital. The aggregate amount of outstanding Class B membership interests shall not exceed 7.5% of the aggregate amount of all outstanding Class A and Class B membership interests. These Class B membership interests will be non-transferable and will vest ratably over five years, which is intended to provide a retention incentive.

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(3)

The address for The Veritas Capital Fund IV, L.P., The Veritas Capital Fund III, L.P., CICPI Holdings LLC, and Messrs. McKeon, Evans, Musallam and Kelly is c/o Veritas Capital Fund Management, L.L.C. 590 Madison Avenue, New York, New York 10022.

(4)

Pursuant to the amended and restated limited liability company agreement governing Holding LLC, Veritas Capital controls the appointment of the board of managers of Holding LLC.

(5)

Mr. McKeon, a member of the board of managers of Holding LLC, is the sole managing member of (i) Veritas Capital Partners IV, L.L.C., which is the general partner of each of The Veritas Capital Fund IV, L.P. and The Veritas Capital Fund III, L.P., and (ii) Veritas Capital Fund Management, L.L.C., which is the non-member manager of CICPI Holdings LLC and, as such, may be deemed a beneficial owner of the Class A membership interests owned by each of The Veritas Capital Fund IV, L.P., The Veritas Capital Fund III, L.P. and CICPI Holdings LLC. Mr. McKeon disclaims this beneficial ownership except to the extent of his pecuniary interest in such entities.

(6)

Includes Class A membership interests held by The Veritas Capital Fund IV, L.P., The Veritas Capital Fund III, L.P. and CICPI Holdings LLC, beneficial ownership of which may be deemed to be held by Mr. McKeon. See footnote 5 above. Mr. McKeon disclaims this beneficial ownership except to the extent of his pecuniary interest in such entities, if any.

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THE TRANSACTIONS

        On November 24, 2010, CPII, Predecessor and Merger Sub entered into the Merger Agreement pursuant to which CPII acquired Predecessor through the merger of Merger Sub with and into Predecessor. The Merger closed on February 11, 2011. Contemporaneously with the consummation of the Merger, the separate corporate existence of Merger Sub ceased, and Predecessor became the surviving corporation. Predecessor's common stock is no longer publicly traded as a result of the Merger. Immediately following the consummation of the Merger and related transactions, Predecessor was converted into a limited liability company and liquidated, and we changed our name to CPI International, Inc. from CPI International Acquisition, Inc.

        In connection with the Merger, Veritas Capital invested $200.0 million solely for the purpose of purchasing equity securities of Holding LLC in order to provide a portion of the financing that was required for the Merger and the transactions contemplated by the Merger Agreement. Certain officers of Predecessor also invested in equity securities of Holding LLC in an aggregate amount of $11.1 million. Immediately following the Merger, the management of Predecessor became management of CPII. Employment agreements between us and certain of our executive officers may be amended or entered into as a result of the Merger.

        On February 11, 2011, we issued the $215 million aggregate principal amount of outstanding notes, and we entered into the Senior Secured Credit Facilities, comprised of a $150.0 million six-year term loan facility and a $30.0 million five-year revolving credit facility with UBS AG, Stamford Branch, as administrative agent, and the financial institutions party thereto. We borrowed the full amount of the term loan thereunder in connection with the Merger, and the revolving credit facility was undrawn at closing (other than for approximately $4.5 million of outstanding letters of credit). In addition, we have the option to increase the amount available under the Senior Secured Credit Facilities by up to an aggregate of $50.0 million on an uncommitted basis. Our obligations under the Senior Secured Credit Facilities are fully and unconditionally guaranteed by the Parent and, subject to certain exceptions, each of the Parent's existing and future domestic restricted subsidiaries (other than CPII). In addition, our obligations under the Senior Secured Credit Facilities and the guarantees of those obligations are secured by (a) pledges of all of the equity interests held by us and each guarantor and (b) liens on substantially all of our assets and the assets of each guarantor, in each case subject to certain exceptions. The Senior Secured Credit Facilities contain customary representations, warranties, covenants and other agreements. Please see "Description of the Senior Secured Credit Facilities" for a more complete description of the Senior Secured Credit Facilities.

        In connection with the Merger, on January 13, 2011 CPI offered to purchase all $117.0 million aggregate principal amount of its existing outstanding 8% Senior Subordinated Notes due 2012 (the "8% Notes"), and Predecessor offered to purchase all $12.0 million aggregate principal amount of its existing outstanding Floating Rate Senior Notes due 2015 (the "FR Notes") pursuant to tender offers and related consent solicitations. All outstanding FR Notes and a portion of the 8% Notes were tendered pursuant to such tender offers and purchased by Predecessor and CPI, respectively, on February 11, 2011. CPI redeemed all remaining outstanding 8% Notes on March 14, 2011.

        We used the equity contributions, borrowings under the term loan facility and the net proceeds from the outstanding notes to pay the Merger consideration, consummate the tender offers and redemption, repay amounts under CPI's existing senior credit facilities and pay related fees and expenses. In this prospectus, we refer to the Merger and these related transactions as the "Transactions."

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CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS

Arrangements With Veritas

Advisory Agreement

        In connection with the Transactions, on February 11, 2011 we entered into an advisory agreement with our Sponsor, pursuant to which our Sponsor will provide us with certain management, advisory and consulting services including, without limitation, business and organizational strategy, financial and advisory services. The initial term of the advisory agreement will end December 31, 2023 and the agreement will renew automatically for additional one-year terms thereafter unless the Sponsor or we terminate the advisory agreement. Pursuant to such agreement, we will pay our Sponsor an annual fee equal to the greater of $1 million and 3.0% of our Adjusted EBITDA, a portion of which is payable in advance annually beginning on the closing date, and we will reimburse certain out-of-pocket expenses of our Sponsor. In addition, our Sponsor received a cash transaction fee of $9 million as consideration for the services provided in connection with the Transactions. If the Parent or any of its subsidiaries (including us) is involved in any transaction (including, without limitation, any acquisition, merger, disposition, debt or equity financing, recapitalization, structural reorganization or similar transaction), we will pay a transaction fee to the Sponsor equal to the greater of $500,000 and 2% of transaction value. We may terminate the advisory agreement immediately prior to a change of control or an initial public offering, upon payment of an amount equal to all accrued fees and expenses plus the present value of all annual fees that would have been payable under the advisory agreement through December 31, 2023. Certain of our directors are also members of management at our Sponsor. See "Management."

Director Independence

        We are not a listed issuer whose securities are listed on a national securities exchange or in an inter-dealer quotation system which has requirements that a majority of the board of directors be independent. However, if we were a listed issuer whose securities were traded on the NYSE and subject to such requirements, we would be entitled to rely on the controlled company exception contained in Section 303A of the NYSE Listed Company Manual for exception from the independence requirements related to the majority of our board of directors. Pursuant to Section 303A of the NYSE Listed Company Manual, a company of which more than 50% of the voting power is held by an individual, a group or another company is exempt from the requirements that its board of directors consist of a majority of independent directors.

Other

        See "Executive Compensation—Compensation Discussion and Analysis—Overview" for a description of arrangements with directors, executive officers and other senior management employees.

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DESCRIPTION OF THE SENIOR SECURED CREDIT FACILITIES

Description of the Senior Secured Credit Facilities

Overview

        In connection with the Transactions, on February 11, 2011, we entered into the Senior Secured Credit Facilities with UBS AG, Stamford Branch, as administrative agent, and the other financial institutions party thereto. The Senior Secured Credit Facilities is structured as (a) a $150.0 million six-year term loan facility; and (b) a $30.0 million five-year revolving credit facility that includes sub-limits for letters of credit and swingline loans. In addition, the Senior Secured Credit Facilities permits us to add one or more incremental facilities to the term loan facility and/or increase commitments under the revolving credit facility in an aggregate principal amount of up to $50.0 million, subject to receipt of commitments for such term loans or increases.

Interest Rate And Fees

        Borrowings under the term loan facility and the revolving credit facility bear interest, at our option, at either (a) a base rate equal to the highest of (i) the federal funds rate, plus 0.50%, (ii) the corporate base rate of interest established by the administrative agent and (iii) adjusted LIBOR for an interest period of one month beginning on such day plus 1%, or (b) LIBOR, in each case plus an applicable margin. For all purposes, LIBOR shall never be deemed to be less than a specified "LIBOR floor."

        We are also required to pay a commitment fee to the lenders under the revolving credit facility in respect of unutilized commitments thereunder. The commitment fee is 0.75% per annum. In addition, we are required to pay customary fees in connection with the issuance of letters of credit.

Prepayments

        The Senior Secured Credit Facilities require us to prepay outstanding loans, subject to certain exceptions, with:

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100% of the net cash proceeds received from the sale or other disposition of all or any part of the assets of the Parent or any of its restricted subsidiaries in excess of an agreed upon threshold, other than sales of inventory in the ordinary course of business and other than amounts reinvested in assets to be used in our business within 12 months of such disposition (or if committed to be reinvested within such 12 months, reinvested within 18 months of such disposition) and subject to other exceptions;

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100% of the net proceeds received by the Parent or any of its restricted subsidiaries from the issuance of debt or disqualified preferred stock after the Closing Date, other than debt permitted under the Senior Secured Credit Facilities;

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100% of all casualty and condemnation proceeds received by the Parent or any of its restricted subsidiaries in excess of an agreed upon threshold, other than amounts reinvested in assets to be used in our business within 12 months of such receipt (or if committed to be reinvested within such 12 months, reinvested within 18 months of such receipt) and subject to other exceptions; and

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50% of excess cash flow of the Parent and its restricted subsidiaries, such percentage to be reduced based on the Parent attaining certain leverage ratios.

        We may also voluntarily prepay outstanding loans under the Senior Secured Credit Facilities in whole or in part, with prior notice but without premium or penalty (except LIBOR breakage costs) and including accrued and unpaid interest, subject to limitations as to minimum amounts of prepayments.

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        Mandatory prepayments will be applied first to scheduled installments of the term loan facility (and allocated to such scheduled installments in direct order to the next eight scheduled installments and thereafter to the remaining scheduled installments on a pro rata basis) until paid in full, second to the revolving credit facility and third to cash collateralize outstanding letters of credit. Voluntary prepayments of loans (including loans under the revolving credit facility to the extent accompanied by permanent reductions of the commitments thereunder), other than prepayments funded with the proceeds of indebtedness, will be credited against excess cash flow prepayment obligations on a dollar-for-dollar basis.

Amortization

        The term loan facility amortizes in equal quarterly installments in annual amounts equal to 1.0% of the original principal amount of the term loan facility, with the balance payable on the maturity date of the term loan facility. The revolving credit facility does not amortize.

Guarantees And Security

        Our obligations under the Senior Secured Credit Facilities are fully and unconditionally guaranteed by the Parent and, subject to certain exceptions, each of the Parent's existing and future domestic restricted subsidiaries (other than CPII). In addition, our obligations under the Senior Secured Credit Facilities and the guarantees of those obligations are secured by substantially all of our assets and all the assets of the guarantors, including but not limited to (a) pledges of all the equity interests held by us and each guarantor and (b) a first-priority security interest in, and mortgages on, substantially all of the present and after-acquired assets of us and each guarantor, in each case subject to certain exceptions.

Certain Covenants And Events Of Default

        The Senior Secured Credit Facilities contain a number of covenants that, among other things, restrict, subject to certain exceptions, the ability of the Parent and its restricted subsidiaries, including CPII, to:

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dispose of assets and make changes in business;

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incur additional indebtedness or issue preferred stock or prepay, amend or redeem certain indebtedness;

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create liens on assets and make further negative pledges;

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enter into sale and leaseback transactions;

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engage in mergers or acquisitions;

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pay dividends or distributions or repurchase or redeem capital stock or make other restricted payments;

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make investments, loans or advances;

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make capital expenditures;

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engage in certain transactions with affiliates;

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amend charter documents and material agreements in a manner adverse in any material respect to the lenders without their consent;

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change accounting polices;

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permit certain restrictions affecting subsidiaries; and

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change the status of Parent as a holding company.

        The Senior Secured Credit Facilities also include financial covenants that will apply to the Parent and its restricted subsidiaries and will consist of a minimum cash interest coverage ratio and a maximum total leverage ratio. In addition, the Senior Secured Credit Facilities contain certain customary affirmative covenants and events of default.

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THE EXCHANGE OFFER

General

        We hereby offer to exchange a like principal amount of exchange notes for any or all outstanding notes on the terms and subject to the conditions set forth in this prospectus and accompanying letter of transmittal. We refer to the offer as the "exchange offer." You may tender some or all of your outstanding notes pursuant to the exchange offer.

        As of the date of this prospectus, $215,000,000 aggregate principal amount of 8.00% Senior Notes due 2018 is outstanding. This prospectus, together with the letter of transmittal, is first being sent to all holders of outstanding notes known to us on or about                        , 2011. Our obligation to accept outstanding notes for exchange pursuant to the exchange offer is subject to certain conditions set forth under "—Conditions to the exchange offer" below. We currently expect that each of the conditions will be satisfied and that no waivers will be necessary.

Purpose and effect of the exchange offer

        We entered into a registration rights agreement with the initial purchasers of the outstanding notes in which we agreed, under certain circumstances, to file a registration statement relating to an offer to exchange the outstanding notes for exchange notes. We also agreed to use our reasonable best efforts to cause this registration statement to be declared effective and to cause the exchange offer to be consummated within 270 days after the issue date of the outstanding notes. The exchange notes will have terms substantially identical to the terms of the outstanding notes, except that the exchange notes will not contain terms with respect to transfer restrictions or additional interest upon a failure to fulfill certain of our obligations under the registration rights agreement. The outstanding notes were issued on February 11, 2011.

        Under the circumstances set forth below, we will use our commercially reasonable efforts to cause the SEC to declare effective a shelf registration statement with respect to the resale of the outstanding notes within the time periods specified in the registration rights agreement and to keep the shelf registration statement effective for at least one year or such shorter period ending when all outstanding notes or exchange notes covered by the shelf registration statement have been sold in the manner set forth and as contemplated in the shelf registration statement. These circumstances include:

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if any changes in law or the applicable interpretations of the staff of the SEC do not permit us and the guarantors to effect this exchange offer;

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if for any other reason the exchange offer is not consummated within 270 days of the issue date of the outstanding notes;

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if any holder of the outstanding notes notifies us prior to the 20th day following consummation of this exchange offer that it is prohibited by law or the applicable interpretations of the staff of the SEC from participating in this exchange offer;

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if any holder of the outstanding notes that participates in this exchange offer does not receive exchange notes that may be sold without restriction in exchange for its tendered outstanding notes (other than due solely to the status of such holder as an affiliate of us); or

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any initial purchaser so requests with respect to outstanding notes that have, or that are reasonably likely to be determined to have, the status of unsold allotments in an initial distribution.

        If we fail to comply with certain obligations under the registration rights agreement, we will be required to pay additional interest to holders of the outstanding notes and the exchange notes required to be registered on a shelf registration statement.

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        Each holder of outstanding notes that wishes to exchange its outstanding notes for exchange notes in the exchange offer will be required to make the following written representations:

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any exchange notes to be received by such holder will be acquired in the ordinary course of its business;

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such holder has no arrangement or understanding with any person to participate in the distribution (within the meaning of the Securities Act) of the exchange notes in violation of the provisions of the Securities Act;

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such holder is not an affiliate of us, as defined by Rule 405 of the Securities Act, or if it is an affiliate, it will comply with the registration and prospectus delivery requirements of the Securities Act to the extent applicable; and

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it is not engaged in, and does not intend to engage in, a distribution of exchange notes.

        Each broker-dealer that receives exchange notes for its own account in exchange for outstanding notes, where the broker-dealer acquired the outstanding notes as a result of market-making activities or other trading activities, must acknowledge that it will deliver a prospectus in connection with any resale of such exchange notes. Please see "Plan of Distribution."

Terms of the Exchange Offer; Period for Tendering Outstanding Notes

        On the terms and subject to the conditions set forth in this prospectus and in the accompanying letter of transmittal, we will accept for exchange in the exchange offer outstanding notes that are validly tendered and not validly withdrawn prior to the expiration date. Outstanding notes may only be tendered in denominations of $1,000 and integral multiples of $1,000. We will issue $1,000 principal amount or an integral multiple of $1,000 of exchange notes in exchange for a corresponding principal amount of outstanding notes surrendered in the exchange offer.

        The form and terms of the exchange notes will be substantially identical to the form and terms of the outstanding notes, except that the exchange notes will not contain terms with respect to transfer restrictions or additional interest upon a failure to fulfill certain of our obligations under the registration rights agreement. The exchange notes will evidence the same debt as the outstanding notes. The exchange notes will be issued under and entitled to the benefits of the same indenture under which the outstanding notes were issued, and the exchange notes and the outstanding notes will constitute a single class for all purposes under the indenture. For a description of the indenture, please see "Description of the Exchange Notes."

        The exchange offer is not conditioned upon any minimum aggregate principal amount of outstanding notes being tendered for exchange.

        This prospectus and a letter of transmittal are being sent to all registered holders of outstanding notes. There will be no fixed record date for determining registered holders of outstanding notes entitled to participate in the exchange offer.

        We intend to conduct the exchange offer in accordance with the provisions of the registration rights agreement, the applicable requirements of the Securities Act and the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and the rules and regulations of the SEC. Outstanding notes that are not tendered for exchange in the exchange offer will remain outstanding and continue to accrue interest and will be entitled to the rights and benefits that such holders have under the indenture relating to such holders' outstanding notes, except for any rights under the registration rights agreement that by their terms terminate upon the consummation of the exchange offer.

        We will be deemed to have accepted for exchange properly tendered outstanding notes when we have given oral or written notice of the acceptance to the exchange agent. The exchange agent will act

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as agent for the tendering holders for the purposes of receiving the exchange notes from us and delivering exchange notes to holders. Subject to the terms of the registration rights agreement, we expressly reserve the right to amend or terminate the exchange offer and to refuse to accept the occurrence of any of the conditions specified below under "—Conditions to the exchange offer".

        Holders who tender outstanding notes in the exchange offer will not be required to pay brokerage commissions or fees or, subject to the instructions in the letter of transmittal, transfer taxes with respect to the exchange of outstanding notes. We will pay all charges and expenses, other than certain applicable taxes described below, in connection with the exchange offer. It is important that you read "—Fees and expenses" below for more details regarding fees and expenses incurred in the exchange offer.

Procedures for Tendering Outstanding Notes

        The tender to us of outstanding notes by you as set forth below and our acceptance of the outstanding notes will constitute a binding agreement between us and you upon the terms and subject to the conditions set forth in this prospectus and in the accompanying letter of transmittal. Except as set forth below, to tender outstanding notes for exchange pursuant to the exchange offer, you must transmit a properly completed and duly executed letter of transmittal, including all other documents required by such letter of transmittal or, in the case of a book-entry transfer, an agent's message in lieu of such letter of transmittal, to The Bank of New York Mellon Trust Company, N.A., as exchange agent, at the address set forth below under "—Exchange Agent" on or prior to the expiration date. In addition:

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certificates for such outstanding notes must be received by the exchange agent along with the letter of transmittal; or

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a timely confirmation of a book-entry transfer (a "book-entry confirmation") of such outstanding notes, if such procedure is available, into the exchange agent's account at DTC pursuant to the procedure for book-entry transfer must be received by the exchange agent, prior to the expiration date, with the letter of transmittal or an agent's message in lieu of such letter of transmittal.

        The term "agent's message" means a message, transmitted by DTC to and received by the exchange agent and forming a part of a book-entry confirmation, which states that DTC has received an express acknowledgment from the tendering participant stating that such participant has received and agrees to be bound by the letter of transmittal and that we may enforce such letter of transmittal against such participant. The method of delivery of outstanding notes, letters of transmittal and all other required documents is at your election and risk. If such delivery is by mail, it is recommended that you use registered mail, properly insured, with return receipt requested. In all cases, you should allow sufficient time to assure timely delivery. No letter of transmittal or outstanding notes should be sent to us.

        Signatures on a letter of transmittal or a notice of withdrawal, as the case may be, must be guaranteed unless the outstanding notes surrendered for exchange are tendered by a holder of the outstanding notes who has not completed the box entitled "Special Issuance Instructions" or "Special Delivery Instructions" on the letter of transmittal, or for the account of an eligible institution (as defined below).

        In the event that signatures on a letter of transmittal or a notice of withdrawal are required to be guaranteed, such guarantees must be by a firm which is a member of the Securities Transfer Agent Medallion Program, the Stock Exchanges Medallion Program or the New York Stock Exchange Medallion Signature Program (each such entity being hereinafter referred to as an "eligible institution"). If outstanding notes are registered in the name of a person other than the signer of the

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letter of transmittal, the outstanding notes surrendered for exchange must be endorsed by, or be accompanied by a written instrument or instruments of transfer or exchange, in satisfactory form as we or the exchange agent determine in our sole discretion, duly executed by the registered holders with the signature thereon guaranteed by an eligible institution.

        We or the exchange agent in our sole discretion will make a final and binding determination on all questions as to the validity, form, eligibility (including time of receipt) and acceptance of outstanding notes tendered for exchange. We reserve the absolute right to reject any and all tenders of any particular outstanding note not properly tendered or to not accept any particular outstanding note which acceptance might, in our judgment or our counsel's, be unlawful. We also reserve the absolute right to waive any defects or irregularities or conditions of the exchange offer as to any particular outstanding note either before or after the expiration date (including the right to waive the ineligibility of any holder who seeks to tender outstanding notes in the exchange offer). Our or the exchange agent's interpretation of the term and conditions of the exchange offer as to any particular outstanding note either before or after the expiration date (including the letter of transmittal and the instructions thereto) will be final and binding on all parties. Unless waived, any defects or irregularities in connection with tenders of outstanding notes for exchange must be cured within a reasonable period of time, as we determine. We are not, nor is the exchange agent or any other person, under any duty to notify you of any defect or irregularity with respect to your tender of outstanding notes for exchange, and no one will be liable for failing to provide such notification.

        If the letter of transmittal is signed by a person or persons other than the registered holder or holders of outstanding notes, such outstanding notes must be endorsed or accompanied by powers of attorney, in either case signed exactly as the name(s) of the registered holder(s) that appear on the outstanding notes and the signatures must be guaranteed by an eligible institution.

        If the letter of transmittal or any outstanding notes or powers of attorney are signed by trustees, executors, administrators, guardians, attorneys-in-fact, officers of corporations or others acting in a fiduciary or representative capacity, such persons should so indicate when signing. Unless waived by us or the exchange agent, proper evidence satisfactory to us of their authority to so act must be submitted with the letter of transmittal.

        By tendering outstanding notes, you represent to us that, among other things, the exchange notes acquired pursuant to the exchange offer are being obtained in the ordinary course of business of the person receiving such exchange notes, whether or not such person is the holder, that neither the holder nor such other person has any arrangement or understanding with any person to participate in the distribution of the exchange notes, and that you are not holding outstanding notes that have, or are reasonably likely to have, the status of an unsold allotment in the initial offering. If you are our "affiliate," as defined under Rule 405 under the Securities Act, are engaged in or intend to engage in or have an arrangement or understanding with any person to participate in a distribution of such exchange notes to be acquired pursuant to the exchange offer, you or any such other person:

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cannot rely on the applicable interpretations of the staff of the SEC; and

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must comply with the registration and prospectus delivery requirements of the Securities Act in connection with any resale transaction.

        Each broker-dealer that receives exchange notes for its own account in exchange for outstanding notes, where such outstanding notes were acquired by such broker-dealer as a result of market-making activities or other trading activities, must acknowledge that it will deliver a prospectus in connection with any resale of such exchange notes. See "Plan of Distribution." The letter of transmittal states that by so acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an "underwriter" within the meaning of the Securities Act.

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        Furthermore, any broker-dealer that acquired any of its outstanding notes directly from us:

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may not rely on the applicable interpretation of the staff of the SEC contained in Exxon Capital Holdings Corp., SEC no-action letter (Apr. 13, 1988), Morgan, Stanley & Co. Inc., SEC no-action letter (June 5, 1991) and Shearman & Sterling, SEC no-action letter (July 2, 1993); and

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must also be named as a selling security holder in connection with the registration and prospectus delivery requirements of the Securities Act relating to any resale transaction.

Acceptance of Outstanding Notes for Exchange; Delivery of Exchange Notes

        Upon satisfaction or waiver of all of the conditions to the exchange offer, we will accept, promptly after the expiration date, all outstanding notes properly tendered and will issue the exchange notes promptly after acceptance of the outstanding notes. See "—Conditions to the exchange offer." For purposes of the exchange offer, we will be deemed to have accepted properly tendered outstanding notes for exchange if and when we give oral (confirmed in writing) or written notice to the exchange agent.

        The holder of each outstanding note accepted for exchange will receive an exchange note in the amount equal to the surrendered outstanding note. Holders of exchange notes on the relevant record date for the first interest payment date following the consummation of the exchange offer will receive interest accruing from the most recent date to which interest has been paid on the outstanding notes. Holders of exchange notes will not receive any payment in respect of accrued interest on outstanding notes otherwise payable on any interest payment date, the record date for which occurs on or after the consummation of the exchange offer.

        In all cases, issuance of exchange notes for outstanding notes that are accepted for exchange will be made only after timely receipt by the exchange agent of:

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a timely book-entry confirmation of such outstanding notes into the exchange agent's account at DTC,

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a properly completed and duly executed letter of transmittal or an agent's message in lieu thereof, and

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all other required documents.

        If any tendered outstanding notes are not accepted for any reason set forth in the terms and conditions of the exchange offer or if outstanding notes are tendered for a greater principal amount than the holder desires to exchange, such unaccepted or non-exchanged outstanding notes will be returned to the holder without cost to such holder or, in the case of outstanding notes tendered by book-entry transfer into the exchange agent's account at DTC pursuant to the procedure described above, such unaccepted or non-exchanged outstanding notes will be credited to an account maintained with DTC promptly after the expiration or termination of the exchange offer.

Book-Entry Transfers

        For purposes of the exchange offer, the exchange agent will request that an account be established with respect to the outstanding notes at DTC within two business days after the date of this prospectus, unless the exchange agent has already established an account with DTC suitable for the exchange offer. Any financial institution that is a participant in DTC may make book-entry delivery of outstanding notes by causing DTC to transfer such outstanding notes into the exchange agent's account at DTC in accordance with DTC's procedures for transfer. Although delivery of outstanding notes may be effected through book-entry transfer at DTC, the letter of transmittal or facsimile thereof or an agent's message in lieu thereof, with any required signature guarantees and any other required documents, must, in any

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case, be transmitted to and received by the exchange agent at the address set forth under "—Exchange Agent" on or prior to the expiration date.

Withdrawal Rights

        You may withdraw your tender of outstanding notes at any time prior to 5:00 p.m., New York City time, on the expiration date. To be effective, a written notice of withdrawal must be received by the exchange agent at one of the addresses set forth under "—Exchange Agent." This notice must specify:

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the name of the person having tendered the outstanding notes to be withdrawn,

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the outstanding notes to be withdrawn (including the principal amount of such outstanding notes),

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where certificates for outstanding notes have been transmitted, the name in which such outstanding notes are registered, if different from that of the withdrawing holder.

        If certificates for outstanding notes have been delivered or otherwise identified to the exchange agent, then, prior to the release of such certificates, the withdrawing holder must also submit the serial numbers of the particular certificates to be withdrawn and a signed notice of withdrawal with signatures guaranteed by an eligible institution, unless such holder is an eligible institution. If outstanding notes have been tendered pursuant to the procedure for book-entry transfer described above, any notice of withdrawal must specify the name and number of the account at DTC to be credited with the withdrawn outstanding notes and otherwise comply with the procedures of DTC.

        We or the exchange agent will make a final and binding determination on all questions as to the validity, form and eligibility (including time of receipt) of such notices. Any outstanding notes so withdrawn will be deemed not to have been validly tendered for exchange for purposes of the exchange offer. Any outstanding notes tendered for exchange but not exchanged for any reason will be returned to the holder without cost to such holder (or, in the case of outstanding notes tendered by book-entry transfer into the exchange agent's account at DTC pursuant to the book-entry transfer procedures described above, such outstanding notes will be credited to an account maintained with DTC for the outstanding notes as soon as practicable after withdrawal, rejection of tender or termination of the exchange offer. Properly withdrawn outstanding notes may be retendered by following one of the procedures described under "—Procedures for Tendering Outstanding notes" above at any time on or prior to the expiration date.

Conditions to the Exchange Offer

        Despite any other term of the exchange offer, we will not be required to accept for exchange, or to issue exchange notes in exchange for, any outstanding notes, and we may terminate or amend the exchange offer as provided in this prospectus before accepting any outstanding notes for exchange, if:

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the exchange offer, or the making of any exchange by a holder of outstanding notes, violates any applicable law or interpretation of the staff of the SEC;

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any action or proceeding shall have been instituted or threatened in any court or by any governmental agency that might materially impair our ability to proceed with the exchange offer, and any material adverse development shall have occurred in any existing action or proceeding with respect to us; or

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all governmental approvals shall not have been obtained, which approvals we deem necessary for the consummation of the exchange offer.

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        In addition, we will not be obligated to accept for exchange the outstanding notes of any holder that has not made to us:

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the representations described under "—Purpose and effect of the exchange offer" and "—Procedures for tendering outstanding notes"; and

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any other representations as may be reasonably necessary under applicable SEC rules, regulations, or interpretations to make available to us an appropriate form for registration of the exchange notes under the Securities Act.

        We expressly reserve the right at any time or at various times to extend the period of time during which the exchange offer is open. Consequently, we may delay acceptance of any outstanding notes by notice by press release or other public announcement as required by Rule 14e-1(d) of the Act of such extension to their holders. During any such extensions, all outstanding notes previously tendered will remain subject to the exchange offer, and we may accept them for exchange. We will return any outstanding notes that we do not accept for exchange for any reason without expense to their tendering holder as promptly after the expiration or termination of the exchange offer.

        We expressly reserve the right to amend or terminate the exchange offer and to reject for exchange any outstanding notes not previously accepted for exchange upon the occurrence of any of the conditions of the exchange offer specified above. We will give notice by press release or other public announcement as required by Rule 14e-1(d) of the Act of any extension, amendment, non-acceptance or termination to the holders of the outstanding notes. In the case of any extension, such notice will be issued no later than 9:00 a.m., New York City time, on the business day after the previously scheduled expiration date.

        These conditions are for our sole benefit, and we may assert them regardless of the circumstances that may give rise to them so long as such circumstances do not arise due to our action or inaction or waive them in whole or in part at any or at various times in our sole discretion. If we fail at any time to exercise any of the foregoing rights, this failure will not constitute a waiver of such right. Each such right will be deemed an ongoing right that we may assert at any time or at various times.

Exchange Agent

        We have appointed The Bank of New York Mellon Trust Company, N.A. as the exchange agent for the exchange offer. The Bank of New York Mellon Trust Company, N.A. also acts as trustee under the indenture governing the notes. All executed letters of transmittal should be directed to the exchange agent at the address set forth below. Questions and requests for assistance, requests for additional copies of this prospectus or of the letter of transmittal should be directed to the exchange agent addressed as follows:

The Bank of New York Mellon Trust Company, N.A., Exchange Agent

By Registered or Certified Mail, Overnight Delivery:

The Bank of New York Mellon Trust Company, N.A.
c/o The Bank of New York Mellon Corporation
Corporate Trust Operations—Reorganization Unit
480 Washington Boulevard, 27^th Floor
Jersey City, NJ 07310
(Attn: Ms. Diane Amoroso)

By Facsimile Transmission:
212-298-1915

To Confirm by Telephone:
212-815-2742

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DELIVERY OF THE LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR TRANSMISSION OF SUCH LETTER OF TRANSMITTAL VIA FACSIMILE OTHER THAN AS SET FORTH ABOVE DOES NOT CONSTITUTE A VALID DELIVERY OF THE LETTER OF TRANSMITTAL.

Fees and Expenses

        The registration rights agreement provides that we will bear all expenses in connection with the performance of our obligations relating to the registration of the exchange notes and the conduct of the exchange offer. These expenses include registration and filing fees, accounting and legal fees and printing costs, among others. We will pay the exchange agent reasonable and customary fees for its services and reasonable out-of-pocket expenses. We will also reimburse brokerage houses and other custodians, nominees and fiduciaries for customary mailing and handling expenses incurred by them in forwarding this prospectus and related documents to their clients that are holders of outstanding notes and for handling or tendering for such clients.

Accounting Treatment

        We will record the exchange notes in our accounting records at the same carrying value as the outstanding notes, which is the aggregate principal amount as reflected in our accounting records on the date of exchanges. Accordingly, we will not recognize any gain or loss for accounting purposes upon the consummation of the exchange offer. We will record the expenses of the exchange offer as incurred.

Transfer Taxes

        We will pay all transfer taxes, if any, applicable to the exchanges of outstanding notes under the exchange offer. The tendering holder, however, will be required to pay any transfer taxes, whether imposed on the registered holder or any other person, if:

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certificates representing outstanding notes for principal amounts not tendered or accepted for exchange are to be delivered to, or are to be issued in the name of, any person other than the registered holder of outstanding notes tendered;

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tendered outstanding notes are registered in the name of any person other than the person signing the letter of transmittal; or

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a transfer tax is imposed for any reason other than the exchange of outstanding notes under the exchange offer.

        If satisfactory evidence of payment of such taxes is not submitted with the letter of transmittal, the amount of such transfer taxes will be billed to that tendering holder.

        Holders who tender their outstanding notes for exchange will not be required to pay any transfer taxes. However, holders who instruct us to register exchange notes in the name of, or request that outstanding notes not tendered or not accepted in the exchange offer be returned to, a person other than the registered tendering holder will be required to pay any applicable transfer tax.

Consequences of Exchanging or Failing to Exchange Outstanding Notes

        If you do not exchange your outstanding notes for exchange notes in the exchange offer, your outstanding notes will continue to be subject to the provisions of the indenture relating to the notes regarding transfer and exchange of the outstanding notes and the restrictions on transfer of the outstanding notes described in the legend on your certificates. These transfer restrictions are required because the outstanding notes were issued under an exemption from, or in transactions not subject to,

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the registration requirements of the Securities Act and applicable state securities laws. In general, the outstanding notes may not be offered or sold unless registered under the Securities Act, except under an exemption from, or in a transaction not subject to, the Securities Act and applicable state securities laws. We do not plan to register the outstanding notes under the Securities Act. Based on interpretations by the staff of the SEC, as set forth in no-action letters issued to third parties, we believe that the exchange notes you receive in the exchange offer may be offered for resale, resold or otherwise transferred without compliance with the registration and prospectus delivery provisions of the Securities Act. However, you will not be able to freely transfer the exchange notes if:

•

you are our "affiliate," as defined in Rule 405 under the Securities Act,

•

you are not acquiring the exchange notes in the exchange offer in the ordinary course of your business,

•

you have an arrangement or understanding with any person to participate in the distribution, as defined in the Securities Act, of the exchange notes you will receive in the exchange offer,

•

you are holding outstanding notes that have, or are reasonably likely to have, the status of an unsold allotment in the initial offering, or

•

you are a participating broker-dealer.

        We do not intend to request the SEC to consider, and the SEC has not considered, the exchange offer in the context of a similar no-action letter. As a result, we cannot guarantee that the staff of the SEC would make a similar determination with respect to the exchange offer as in the circumstances described in the no action letters discussed above. Each holder, other than a broker-dealer, must acknowledge that it is not engaged in, and does not intend to engage in, a distribution of exchange notes and has no arrangement or understanding to participate in a distribution of exchange notes. If you are our affiliate, are engaged in or intend to engage in a distribution of the exchange notes or have any arrangement or understanding with respect to the distribution of the exchange notes you will receive in the exchange offer, you may not rely on the applicable interpretations of the staff of the SEC and you must comply with the registration and prospectus delivery requirements of the Securities Act in connection with any resale transaction involving the exchange notes. If you are a participating broker-dealer, you must acknowledge that you will deliver a prospectus in connection with any resale of the exchange notes. In addition, to comply with state securities laws, you may not offer or sell the exchange notes in any state unless they have been registered or qualified for sale in that state or an exemption from registration or qualification is available and is complied with. The offer and sale of the exchange notes to "qualified institutional buyers" (as defined in Rule 144A of the Securities Act) is generally exempt from registration or qualification under state securities laws. We do not plan to register or qualify the sale of the exchange notes in any state where an exemption from registration or qualification is required and not available.

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DESCRIPTION OF THE EXCHANGE NOTES

        As used below in this "Description of the Exchange Notes" section, the "Issuer" means CPI International, Inc. (which was formerly known as CPI International Acquisition, Inc. and was renamed following the Merger), a Delaware corporation, and its successors, but not any of its subsidiaries. The exchange notes will be issued by the Issuer described in this prospectus under the Indenture, dated as of February 11, 2011 (the "Indenture"), among the Issuer, the Guarantors and The Bank of New York Mellon Trust Company, N.A., as trustee (the "Trustee"), which is the same Indenture under which the outstanding notes were issued. The exchange notes and any outstanding notes remaining outstanding after the consummation of the exchange offer will constitute a single class for all purposes under the Indenture. As used below in this Description of the Exchange Notes section, the "Notes" means the exchange notes offered hereby. The terms of the Notes include those set forth in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act. A copy of the Indenture has been filed as an exhibit to the registration statement of which this prospectus is a part.

        The following is a summary of the material terms and provisions of the Notes. The following summary does not purport to be a complete description of the Notes and is subject to the detailed provisions of, and qualified in its entirety by reference to, the Indenture. You can find definitions of certain terms used in this description under the heading "—Certain Definitions."

Principal, Maturity And Interest

        The Notes will mature on February 15, 2018. The Notes bear interest at the rate shown on the cover page of this Prospectus, payable on February 15 and August 15 of each year, commencing on August 15, 2011, to Holders of record at the close of business on February 1 or August 1, as the case may be, immediately preceding the relevant interest payment date. Interest on the Notes will be computed on the basis of a 360-day year of twelve 30-day months.

        The Notes were issued in registered form, without coupons, and in denominations of $1,000 and integral multiples of $1,000.

        An aggregate principal amount of Notes equal to $215.0 million is being issued in this offering. The Issuer may issue additional Notes having identical terms and conditions as the Notes being issued in this offering, except for issue date, issue price and first interest payment date, in an unlimited aggregate principal amount (the "Additional Notes"), subject to compliance with the covenant described under "—Certain Covenants—Limitations on Additional Indebtedness." Any Additional Notes will be part of the same issue as the Notes issued on the Issue Date and treated as one class with the Notes being issued in this offering, including for purposes of voting, redemptions and offers to purchase. For purposes of this "Description of the Exchange Notes," except for the covenant described under "—Certain Covenants—Limitations on Additional Indebtedness," references to the Notes include Additional Notes, if any.

Methods Of Receiving Payments On The Notes

        If a Holder of at least $5.0 million in principal amount of Notes has given wire transfer instructions to the Issuer at least ten Business Days prior to the applicable payment date, the Issuer will make all payments on such Holder's Notes by wire transfer of immediately available funds to the account specified in those instructions. Otherwise, payments on the Notes will be made at the office or agency of the paying agent (the "Paying Agent") and registrar (the "Registrar") for the Notes within the City and State of New York unless the Issuer elects to make interest payments by check mailed to the Holders at their addresses set forth in the register of Holders. Notwithstanding the foregoing, all payments with respect to Notes represented by one or more global notes registered in the name of or held by The Depository Trust Company or its nominee will be made by wire transfer of immediately

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available funds to the account specified by the Holder. Until otherwise designated by the Issuer, the Issuer's office or agency in New York will be the office of the Trustee maintained for such purpose.

Ranking

        The Notes will be general unsecured obligations of the Issuer. The Notes will rank senior in right of payment to all future obligations of the Issuer that are, by their terms, expressly subordinated in right of payment to the Notes and pari passu in right of payment with all existing and future unsecured obligations of the Issuer that are not so subordinated. Each Note Guarantee (as defined below) will be a general unsecured obligation of the Guarantor thereof and will rank senior in right of payment to all future obligations of such Guarantor that are, by their terms, expressly subordinated in right of payment to such Note Guarantee and pari passu in right of payment with all existing and future unsecured obligations of such Guarantor that are not so subordinated.

        The Notes and each Note Guarantee will be effectively subordinated to secured Indebtedness of the Issuer and the applicable Guarantor to the extent of the value of the assets securing such Indebtedness. The Credit Agreement will be secured by substantially all of the assets of Parent and its Subsidiaries, including the Issuer.

        The Notes will also be structurally subordinated to all existing and future obligations, including Indebtedness, of Subsidiaries that are not Guarantors, including Unrestricted Subsidiaries and Foreign Subsidiaries. Claims of creditors of these Subsidiaries, including trade creditors, will generally have priority as to the assets of these Subsidiaries over the claims of the Issuer and the holders of the Issuer's Indebtedness, including the Notes.

        As of December 31, 2010, on a pro forma basis, the Issuer would have had approximately $150.0 million aggregate principal amount of secured Indebtedness (excluding $4.5 million of letters of credit), and $25.5 million of additional secured Indebtedness would have been available to be borrowed under the Credit Agreement. Although the Indenture will contain limitations on the amount of additional secured Indebtedness that the Issuer and the Restricted Subsidiaries may incur, under certain circumstances, the amount of this Indebtedness could be substantial. See "—Certain Covenants—Limitations on Additional Indebtedness" and "—Certain Covenants—Limitations on Liens."

Note Guarantees

        The Issuer's obligations under the Notes and the Indenture will be jointly and severally guaranteed (the "Note Guarantees") by Parent and each Restricted Subsidiary (other than any Excluded Subsidiary).

        As of December 31, 2010, on a pro forma basis, the Notes would have been structurally junior to approximately $30.8 million of indebtedness and other liabilities (including trade payables) of our non-guarantor subsidiaries.

        Our non-guarantor subsidiaries accounted for approximately $149.7 million, or 41.5%, of our net sales, and approximately $12.2 million, or 30.1%, of our net income, for the year ended October 1, 2010, and approximately $104.7 million, or 24.2%, of our total assets (net of cash and cash equivalents) as of October 1, 2010. Our non-guarantor subsidiaries accounted for approximately $38.4 million, or 43.1%, of our net sales, and approximately $2.1 million, or 27.1%, of our net income, for the quarter ended December 31, 2010, and approximately $103.1 million, or $24.0%, of our total assets (net of cash and cash equivalents) as of December 31, 2010. Amounts (other than net income) are presented after giving effect to intercompany eliminations.

        As of the date of the Indenture, all of our Subsidiaries will be "Restricted Subsidiaries." However, under the circumstances described below under the subheading "—Certain Covenants—Limitations on

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Designation of Unrestricted Subsidiaries," the Issuer will be permitted to designate any of its Subsidiaries as "Unrestricted Subsidiaries." The effect of designating a Subsidiary as an "Unrestricted Subsidiary" will be that:

•

an Unrestricted Subsidiary will not be subject to the restrictive covenants in the Indenture;

•

a Subsidiary that has previously been a Guarantor and that is designated an Unrestricted Subsidiary will be released from its Note Guarantee and its obligations under the Indenture and the Registration Rights Agreement; and

•

the assets, income, cash flow and other financial results of an Unrestricted Subsidiary will not be consolidated with those of the Issuer for purposes of calculating compliance with the restrictive covenants contained in the Indenture.

        The obligations of each Subsidiary Guarantor under its Note Guarantee will be limited to the maximum amount as will, after giving effect to all other contingent and fixed liabilities of such Subsidiary Guarantor (including, without limitation, any guarantees under the Credit Agreement) and after giving effect to any collections from or payments made by or on behalf of any other Subsidiary Guarantor in respect of the obligations of such other Subsidiary Guarantor under its Note Guarantee or pursuant to its contribution obligations under the Indenture, result in the obligations of such Subsidiary Guarantor under its Note Guarantee not constituting a fraudulent conveyance or fraudulent transfer under federal or state law. See "Risk Factors—Risks Related To the Exchange Offer and Holding of the Notes—Federal and state statutes may allow courts, under specific circumstances, to void the guarantees and require noteholders to return payments received from guarantors."

        Each Subsidiary Guarantor that makes a payment for distribution under its Note Guarantee is entitled to a contribution from each other Subsidiary Guarantor in a pro rata amount based on the adjusted net assets of each Subsidiary Guarantor.

        A Subsidiary Guarantor shall be released from its obligations under its Note Guarantee and its obligations under the Indenture and the Registration Rights Agreement:

(1)

in the event of a sale or other disposition of all or substantially all of the assets of such Subsidiary Guarantor, by way of merger, consolidation or otherwise, or a sale or other disposition of all of the Equity Interests of such Subsidiary Guarantor then held by the Issuer and the Restricted Subsidiaries;



(2)

if such Subsidiary Guarantor is designated as an Unrestricted Subsidiary or otherwise ceases to be a Restricted Subsidiary, in each case in accordance with the provisions of the Indenture, upon effectiveness of such designation or when it first ceases to be a Restricted Subsidiary, respectively; or



(3)

upon the exercise by the Issuer of its legal defeasance option or covenant defeasance option as described under "—Legal Defeasance and Covenant Defeasance" or the discharge of the Issuer's obligations under the Indenture as described under "—Satisfaction and Discharge."

        The Guarantee of Parent may be released at any time without the consent of any Holder.

Optional Redemption

        At any time or from time to time on or after February 15, 2015, the Issuer, at its option, may redeem the Notes, in whole or in part, at the redemption prices (expressed as percentages of principal

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amount) set forth below, together with accrued and unpaid interest thereon, if any, to the redemption date, if redeemed during the 12-month period beginning February 15 of the years indicated:

Year	Optional redemption price
2015		104.00	%
2016		102.00	%
2017 and thereafter		100.00	%

        In addition, at any time prior to February 15, 2015, the Issuer may redeem all or a part of the Notes at a redemption price equal to 100% of the principal amount of the Notes to be redeemed plus the Applicable Premium as of, plus accrued and unpaid interest, if any, to, the redemption date.

Redemption with Proceeds from Equity Offerings

        At any time, and on one or more occasions, prior to February 15, 2014, the Issuer may redeem up to 35% of the aggregate principal amount of the Notes with the net cash proceeds of one or more Qualified Equity Offerings at a redemption price equal to 108.00% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest thereon, if any, to the date of redemption; provided that (1) at least 65% of the aggregate principal amount of Notes issued under the Indenture remains outstanding immediately after the occurrence of such redemption (excluding in such calculation Notes held by Parent and its Subsidiaries) and (2) the redemption occurs within 120 days of the date of the closing of any such Qualified Equity Offering.

        Notice of any redemption upon any Qualified Equity Offering may be given prior to the completion thereof, and any such redemption or notice may, at the Issuer's discretion, be subject to the closing of the related Qualified Equity Offering.

        The Issuer may acquire Notes by means other than a redemption, whether pursuant to an issuer tender offer, open market purchase or otherwise, so long as the acquisition does not otherwise violate the terms of the Indenture.

Selection And Notice Of Redemption

        In the event that less than all of the Notes are to be redeemed at any time pursuant to an optional redemption, selection of the Notes for redemption will be made by the Trustee in compliance with the requirements of the principal national securities exchange, if any, on which the Notes are listed or, if the Notes are not then listed on a national security exchange, on a pro rata basis, by lot or by such method as the Trustee shall deem fair and appropriate; provided, however, that no Notes of a principal amount of $1,000 or less shall be redeemed in part. In addition, if a partial redemption is made pursuant to the provisions described under "—Optional Redemption—Redemption with Proceeds from Equity Offerings," selection of the Notes or portions thereof for redemption shall be made by the Trustee only on a pro rata basis or on as nearly a pro rata basis as is practicable (subject to the procedures of The Depository Trust Company), unless that method is otherwise prohibited.

        Notice of redemption will be mailed by first-class mail at least 30 but not more than 60 days before the date of redemption to each Holder of Notes to be redeemed at its registered address, except that redemption notices may be mailed more than 60 days prior to a redemption date if the notice is issued in connection with a defeasance of the Notes or a satisfaction and discharge of the Indenture. If any Note is to be redeemed in part only, the notice of redemption that relates to that Note will state the portion of the principal amount of the Note to be redeemed. A new Note in a principal amount equal to the unredeemed portion of the Note will be issued in the name of the Holder of the Note upon cancellation of the original Note. On and after the date of redemption, interest will cease to accrue on Notes or portions thereof called for redemption so long as the Issuer has deposited with the

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paying agent for the Notes funds in satisfaction of the redemption price (including accrued and unpaid interest on the Notes to be redeemed) pursuant to the Indenture.

Change Of Control

        Upon the occurrence of any Change of Control, unless the Issuer has previously or concurrently mailed a redemption notice with respect to all the outstanding Notes as described under "Optional Redemption," each Holder will have the right to require that the Issuer purchase all or any part (equal to $1,000 or an integral multiple thereof) of that Holder's Notes for a cash price (the "Change of Control Purchase Price") equal to 101% of the principal amount of the Notes to be purchased, plus accrued and unpaid interest thereon, if any, to the date of purchase.

        Within 30 days following any Change of Control, the Issuer will mail, or caused to be mailed, to the Holders a notice:

(1)

describing the transaction or transactions that constitute the Change of Control;



(2)

offering to purchase, pursuant to the procedures required by the Indenture and described in the notice (a "Change of Control Offer"), on a date specified in the notice (which shall be a Business Day not earlier than 30 days nor later than 60 days from the date the notice is mailed) and for the Change of Control Purchase Price, all Notes properly tendered by such Holder pursuant to such Change of Control Offer; and



(3)

describing the procedures that Holders must follow to accept the Change of Control Offer. The Change of Control Offer is required to remain open for at least 20 Business Days or for such longer period as is required by law.

        The Issuer will publicly announce the results of the Change of Control Offer on or as soon as practicable after the date of purchase.

        If a Change of Control Offer is made, there can be no assurance that the Issuer will have available funds sufficient to pay for all or any of the Notes that might be delivered by Holders seeking to accept the Change of Control Offer. In addition, we cannot assure you that in the event of a Change of Control the Issuer will be able to obtain the consents necessary to consummate a Change of Control Offer from the lenders under agreements governing outstanding Indebtedness, including our Credit Agreement, which prohibits the consummation of such offer.

        The provisions described above that require us to make a Change of Control Offer following a Change of Control will be applicable regardless of whether any other provisions of the Indenture are applicable to the transaction giving rise to the Change of Control. Except as described above with respect to a Change of Control, the Indenture will not contain provisions that permit the Holders of the Notes to require that the Issuer purchase or redeem the Notes in the event of a takeover, recapitalization or similar transaction.

        The Issuer's obligation to make a Change of Control Offer will be satisfied if a third party makes the Change of Control Offer in the manner and at the times and otherwise in compliance with the requirements applicable to a Change of Control Offer made by the Issuer and purchases all Notes properly tendered and not withdrawn under the Change of Control Offer.

        Notwithstanding anything to the contrary herein, a Change of Control Offer may be made in advance of a Change of Control, conditional upon such Change of Control, if a definitive agreement is in place for the Change of Control at the time of making of the Change of Control Offer.

        With respect to any disposition of assets, the phrase "all or substantially all" as used in the Indenture (including as set forth under the definition of "Change of Control" and "—Certain Covenants—Limitations on Mergers, Consolidations, Etc." below) varies according to the facts and

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circumstances of the subject transaction, has no clearly established meaning under New York law (which governs the Indenture) and is subject to judicial interpretation. Accordingly, in certain circumstances there may be a degree of uncertainty in ascertaining whether a particular transaction would involve a disposition of "all or substantially all" of the assets of the Issuer, and therefore it may be unclear as to whether a Change of Control has occurred and whether the Holders have the right to require the Issuer to purchase Notes.

        The Issuer will comply with applicable tender offer rules, including the requirements of Rule 14e-l under the Exchange Act and any other applicable laws and regulations in connection with the purchase of Notes pursuant to a Change of Control Offer. To the extent that the provisions of any securities laws or regulations conflict with the "Change of Control" provisions of the Indenture, the Issuer shall comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the "Change of Control" provisions of the Indenture by virtue of this compliance.

Certain Covenants

        The Indenture contains, among others, the covenants set forth below.

        During any period of time that (i) the Notes have Investment Grade Ratings from both Rating Agencies and (ii) no Default has occurred and is continuing under the Indenture (the occurrence of the events described in the foregoing clauses (i) and (ii) being collectively referred to as a "Covenant Suspension Event" and the date thereof being referred to as the "Suspension Date") then, the covenants specifically listed under the following captions in this "Description of the Exchange Notes" section of this prospectus will not be applicable to the Notes (collectively, the "Suspended Covenants"):

(1)

"—Limitations on Additional Indebtedness";



(2)

"—Limitations on Layering Indebtedness";



(3)

"—Limitations on Restricted Payments";



(4)

"—Limitations on Dividend and Other Restrictions Affecting Restricted Subsidiaries";



(5)

"—Limitations on Transactions with Affiliates";



(6)

"—Limitations on Asset Sales"; and



(7)

clause (3) of the first paragraph of "—Limitations on Mergers, Consolidations, Etc.".

        Following any Suspension Date and prior to a corresponding Reversion Date, the Issuer may not designate any Subsidiaries as Unrestricted Subsidiaries pursuant to the provisions described under "—Limitations on Designation of Unrestricted Subsidiaries."

        In the event that the Issuer and its Restricted Subsidiaries are not subject to the Suspended Covenants under the Indenture for any period of time as a result of the foregoing, and on any subsequent date (the "Reversion Date") one or both of the Rating Agencies withdraw their Investment Grade Rating or downgrade the rating assigned to the Notes below an Investment Grade Rating, then the Issuer and its Restricted Subsidiaries will thereafter again be subject to the Suspended Covenants under the Indenture with respect to future events. The period of time between the Suspension Date and the Reversion Date is referred to in this description as the "Suspension Period". Additionally, upon the occurrence of a Covenant Suspension Event, the amount of Net Available Proceeds shall be reset to zero.

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        Notwithstanding the foregoing, in the event of any such reinstatement, no action taken or omitted to be taken by the Issuer or any of its Restricted Subsidiaries prior to such reinstatement will give rise to a Default or Event of Default under the Indenture; provided that (1) with respect to Restricted Payments made after such reinstatement, the amount of Restricted Payments made will be calculated as though the covenant described above under the caption "—Limitations on Restricted Payments" had been in effect prior to, but not during, the Suspension Period (and, for avoidance of doubt, all Consolidated Net Income and other amounts attributable to the Suspension Period that would otherwise increase the amount of the Restricted Payments Basket shall be excluded in determining the amount of the Restricted Payments Basket following the Reversion Date); and (2) all Indebtedness incurred, or Disqualified Equity Interests issued, during the Suspension Period will be classified to have been incurred or issued pursuant to clause (3) of the second paragraph of "—Limitations on Additional Indebtedness."

        The Issuer shall give the Trustee and the Holders notice of each Suspension Date and each Reversion Date.

        There can be no assurance that the Notes will ever achieve or maintain Investment Grade Ratings.

Limitations on Additional Indebtedness

        The Issuer will not, and will not permit any Restricted Subsidiary to, directly or indirectly, incur any Indebtedness; provided that the Issuer or any Guarantor may incur additional Indebtedness if, after giving effect thereto, the Consolidated Interest Coverage Ratio would be at least 2.00 to 1.00 (the "Coverage Ratio Exception").

        Notwithstanding the above, each of the following shall be permitted (the "Permitted Indebtedness"):

(1)

Indebtedness under Credit Facilities in an aggregate amount at any time outstanding not to exceed $230.0 million;



(2)

the Notes issued on the Issue Date and the Note Guarantees and the Exchange Notes and the Note Guarantees in respect thereof to be issued pursuant to the Registration Rights Agreement;



(3)

Indebtedness of the Issuer and the Restricted Subsidiaries to the extent outstanding on the Issue Date (other than Indebtedness referred to in clauses (1) and (2) above or (5) below) after giving effect to the Transactions;



(4)

Indebtedness under Hedging Obligations entered into in the ordinary course of business for bona fide hedging purposes and not for the purpose of speculation that are designed to protect against fluctuations in interest rates, foreign currency exchange rates and commodity prices;



(5)

(x) Indebtedness of the Issuer owed to a Restricted Subsidiary and Indebtedness of any Restricted Subsidiary owed to the Issuer or any other Restricted Subsidiary and (y) guarantees by the Issuer or any Restricted Subsidiary of any Indebtedness of the Issuer or any other Restricted Subsidiary that is permitted to be incurred by another provision of this covenant and could have been incurred (in compliance with this covenant) by the Person so guaranteeing such Indebtedness; provided, however, that upon any such Restricted Subsidiary ceasing to be a Restricted Subsidiary or such Indebtedness being owed to any Person other than the Issuer or a Restricted Subsidiary, the Issuer or such Restricted Subsidiary, as applicable, shall be deemed to have incurred Indebtedness not permitted by this clause (5);



(6)

Indebtedness in respect of bid, performance, bank guarantees or surety bonds issued for the account of the Issuer or any Restricted Subsidiary in the ordinary course of business, including

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guarantees or obligations of the Issuer or any Restricted Subsidiary with respect to letters of credit supporting such bid, performance or surety obligations (in each case other than for an obligation for money borrowed) and reimbursement obligations with respect to letters of credit issued in the ordinary course of business in respect of workers' compensation claims or other similar obligations;

(7)

Purchase Money Indebtedness and Capitalized Lease Obligations incurred by the Issuer or any Restricted Subsidiary, and Refinancing Indebtedness thereof, in an aggregate amount not to exceed at any time outstanding $25.0 million;



(8)

Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of business; provided, however, that such Indebtedness is extinguished within fifteen Business Days of incurrence;



(9)

Indebtedness arising in connection with endorsement of instruments for deposit or other commercial banking arrangements to manage cash balances, in each case, in the ordinary course of business;



(10)

Refinancing Indebtedness with respect to Indebtedness incurred pursuant to the Coverage Ratio Exception or clauses (2) or (3) above, this clause (10), or clauses (11) and (13) below;



(11)

Indebtedness of Foreign Subsidiaries; provided that at the time of incurrence of Indebtedness under this clause (11) and after giving effect thereto, Consolidated Interest Coverage Ratio of the Foreign Subsidiaries (calculated by replacing the references to the Issuer in the relevant definitions to all Foreign Subsidiaries) is at least 2.00 to 1.00;



(12)

Indebtedness of the Issuer or any Restricted Subsidiary in an aggregate amount not to exceed $25.0 million at any time outstanding;



(13)

(i) Acquired Indebtedness or (ii) Indebtedness the proceeds of which are used to fund the acquisition (including related transaction fees and expenses and any related refinancing of Acquired Indebtedness) of (x) the Equity Interests of any Person that becomes a Restricted Subsidiary or merges with or into a Restricted Subsidiary or the Issuer or (y) any assets by the Issuer or any Restricted Subsidiary; provided that after giving effect thereto and the transaction giving rise to such Acquired Indebtedness or Indebtedness,



(a)

the Issuer would be permitted to incur at least $1.00 of additional Indebtedness pursuant to the Coverage Ratio Exception; or



(b)

the Consolidated Interest Coverage Ratio of the Issuer and the Restricted Subsidiaries is equal to or greater than immediately prior to such transaction;



(14)

Indebtedness constituting indemnification, adjustment of purchase price, earnouts or similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or a Subsidiary, other than guarantees of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or a Subsidiary for the purpose of financing such acquisition; provided, that



(a)

such Indebtedness is not reflected on the balance sheet of the Issuer or any Restricted Subsidiary (excluding the footnotes thereto); and



(b)

the maximum assumable liability in respect of all such Indebtedness shall at no time exceed the gross proceeds including non-cash proceeds (the fair market value of such non-cash proceeds being measured at the time received and without giving effect to any subsequent changes in value) actually received by the Issuer and its Restricted Subsidiaries in connection with such disposition;

152

(15)

customer deposits and advance payments received in the ordinary course of business from customers for goods purchased in the ordinary course of business; and



(16)

Indebtedness consisting of (a) the financing of insurance premiums or (b) take-or-pay obligations contained in supply arrangements, in each case, incurred in the ordinary course of business.

        For purposes of determining compliance with this covenant, in the event that an item of Indebtedness meets the criteria of more than one of the categories of Permitted Indebtedness described in clauses (1) through (16) above or is entitled to be incurred pursuant to the Coverage Ratio Exception, the Issuer shall, in its sole discretion, classify such item of Indebtedness and may divide and classify such Indebtedness in more than one of the types of Indebtedness described, except that Indebtedness incurred under the Credit Facilities on the Issue Date shall be deemed to have been incurred under clause (1) above, and may later reclassify any item of Indebtedness described in clauses (1) through (16) above (provided that at the time of reclassification it meets the criteria in such category or categories). In addition, for purposes of determining any particular amount of Indebtedness under this covenant, guarantees, Liens or letter of credit obligations supporting Indebtedness otherwise included in the determination of such particular amount shall not be included so long as incurred by a Person that could have incurred such Indebtedness.

Limitations on Layering Indebtedness

        The Issuer will not, and will not permit any Guarantor to, directly or indirectly, incur any Indebtedness that is or purports to be by its terms (or by the terms of any agreement governing such Indebtedness) subordinated in right of payment to any other Indebtedness of the Issuer or of such Guarantor, as the case may be, unless such Indebtedness is also by its terms (or by the terms of any agreement governing such Indebtedness) made expressly subordinate in right of payment to the Notes or the Note Guarantee of such Guarantor, to the same extent and in the same manner as such Indebtedness is subordinated in right of payment to such other Indebtedness of the Issuer or such Guarantor, as the case may be.

        For purposes of the foregoing, no Indebtedness will be deemed to be subordinated in right of payment to any other Indebtedness of the Issuer or any Guarantor solely by virtue of being unsecured or secured by a junior priority lien or by virtue of the fact that the holders of such Indebtedness have entered into intercreditor agreements or other arrangements giving one or more of such holders priority over the other holders in the collateral held by them, including intercreditor agreements that contain customary provisions requiring turnover by holders of junior prior liens of proceeds of collateral in the event that the security interests in favor of the holders of the senior priority in such intended collateral are not perfected or invalidated and similar customary provisions protecting the holders of senior priority liens.

Limitations on Restricted Payments

        The Issuer will not, and will not permit any Restricted Subsidiary to, directly or indirectly, make any Restricted Payment if at the time of such Restricted Payment:

(1)

a Default shall have occurred and be continuing or shall occur as a consequence thereof;



(2)

the Issuer cannot incur $1.00 of additional Indebtedness pursuant to the Coverage Ratio Exception; or



(3)

the amount of such Restricted Payment, when added to the aggregate amount of all other Restricted Payments made after the Issue Date (other than Restricted Payments made

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pursuant to clause (2), (3), (4), (5), (6), (7), (8) or (9) of the next paragraph), exceeds the sum (the "Restricted Payments Basket") of (without duplication):

(a)

50% of Consolidated Net Income for the period (taken as one accounting period) commencing on the first day of the fiscal quarter in which the Issue Date occurs to and including the last day of the fiscal quarter ended immediately prior to the date of such calculation for which consolidated financial statements are available (or, if such Consolidated Net Income shall be a deficit, minus 100% of such aggregate deficit), plus

(b)

100% of the aggregate net proceeds, including cash and the Fair Market Value of property other than cash, received by the Issuer either (x) as contributions to the common equity of the Issuer after the Issue Date or (y) from the issuance and sale of Qualified Equity Interests after the Issue Date, other than any such proceeds which are used to redeem Notes in accordance with "—Optional Redemption—Redemption with Proceeds from Equity Offerings," plus

(c)

the aggregate amount by which Indebtedness (other than any Subordinated Indebtedness) incurred by the Issuer or any Restricted Subsidiary subsequent to the Issue Date is reduced on the Issuer's balance sheet upon the conversion or exchange (other than by a Subsidiary of the Issuer) into Qualified Equity Interests (less the amount of any cash, or the fair value of assets, distributed by the Issuer or any Restricted Subsidiary upon such conversion or exchange), plus

(d)

in the case of the disposition or repayment of or return on any Investment that was treated as a Restricted Payment made after the Issue Date, an amount (to the extent not included in the computation of Consolidated Net Income) equal to 100% of the aggregate amount received by the Issuer or any Restricted Subsidiary in cash or other property (valued at the Fair Market Value thereof) as the return of capital with respect to such Investment, less the cost of the disposition of such Investment and net of taxes, plus

(e)

upon a Redesignation of an Unrestricted Subsidiary as a Restricted Subsidiary the Fair Market Value of the Issuer's proportionate interest in such Subsidiary immediately following such Redesignation to the extent such Investments reduced the Restricted Payments Basket or constituted a Permitted Investment and were not previously repaid or otherwise reduced.

        The foregoing provisions will not prohibit:

(1)

the payment by the Issuer or any Restricted Subsidiary of any dividend within 60 days after the date of declaration thereof, if on the date of declaration the payment would have complied with the provisions of the Indenture;



(2)

the redemption of any Equity Interests of the Issuer or any Restricted Subsidiary in exchange for, or out of the proceeds of the substantially concurrent issuance and sale of, Qualified Equity Interests or from the substantially concurrent contribution to the common equity capital of the Issuer;



(3)

the redemption of Subordinated Indebtedness of the Issuer or any Restricted Subsidiary (a) in exchange for, or out of the proceeds of the substantially concurrent issuance and sale of, Qualified Equity Interests or from the substantially concurrent contribution to the common equity capital of the Issuer; (b) in exchange for, or out of the proceeds of the substantially concurrent incurrence of, Refinancing Indebtedness permitted to be incurred under the "Limitations on Additional Indebtedness" covenant and the other terms of the Indenture or (c) upon a Change of Control or in connection with an Asset Sale to the extent required by the agreement governing such Subordinated Indebtedness but only if the Issuer shall have

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complied with the covenants described under "Change of Control" and "Limitations on Asset Sales" and purchased all Notes validly tendered pursuant to the relevant offer prior to purchasing or repaying such Subordinated Indebtedness;

(4)

Restricted Payments which are used to redeem Equity Interests of the Issuer or Parent held by officers, directors, consultants or employees or former officers, directors, consultants or employees (or their transferees, estates or beneficiaries under their estates) of Parent or any of its Subsidiaries upon their death, disability, retirement, severance or termination of employment or service; provided that the aggregate cash consideration paid for all such redemptions shall not exceed $3.0 million during any calendar year (with unused amounts in any calendar year being usable, without duplication, in subsequent calendar years, provided that not more than $5.0 million of unused amounts from previous calendar years may be utilized in any single calendar year);



(5)

payments, distributions or Investments permitted pursuant to clauses (2), (3), (4) and (9) of the second paragraph of the covenant described under "—Limitations on Transactions with Affiliates";



(6)

repurchases of Equity Interests deemed to occur upon the exercise of stock options or warrants if the Equity Interests represent a portion of the exercise price thereof;



(7)

any payments made in connection with the consummation of the Transactions as described in this Prospectus, including any loans or distributions to Parent to make such payments;



(8)

other Restricted Payments in an aggregate amount not to exceed $15.0 million;



(9)

the declaration and payment of dividends or other distributions to holders of any class or series of Disqualified Equity Interests or any Preferred Stock of any Restricted Subsidiary issued in accordance with the covenant described under "—Limitation on Additional Indebtedness" to the extent such dividends or distributions are included in Consolidated Interest Expense in calculating the Consolidated Interest Coverage Ratio; or



(10)

the declaration and payment of dividends on the Issuer's common stock (or the payment of dividends to any direct or indirect parent entity to fund a payment of dividends on such entity's common stock), following the first public offering of the Issuer's common stock or the common stock of any of its direct or indirect parent companies after the Issue Date, of up to 6.0% per annum of the net cash proceeds received by or contributed to the Issuer in or from any such public offering, other than public offerings with respect to the Issuer's common stock registered on Form S-4 or Form S-8;

provided that (a) in the case of any Restricted Payment pursuant to clauses (3), (8), (9) or (10) above, no Default shall have occurred and be continuing or occur as a consequence thereof and (b) to the extent the issuance and sale of Qualified Equity Interests or contributions to the common equity capital of the Issuer are used to make a payment pursuant to clause (2) or (3) above, such issuance and sale or contribution shall not increase the Restricted Payments Basket.

Limitations on Dividend and Other Restrictions Affecting Restricted Subsidiaries

        The Issuer will not, and will not permit any Restricted Subsidiary to, directly or indirectly, create or otherwise cause or permit to exist or become effective any consensual encumbrance or consensual restriction on the ability of any Restricted Subsidiary to:

(a)

pay dividends or make any other distributions on or in respect of its Equity Interests;



(b)

make loans or advances or pay any Indebtedness or other obligation owed to the Issuer or any other Restricted Subsidiary; or

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(c)

transfer any of its assets to the Issuer or any other Restricted Subsidiary;

        except for:

(1)

encumbrances or restrictions existing under or by reason of applicable law;



(2)

encumbrances or restrictions existing under the Indenture, the Notes and the Note Guarantees;



(3)

non-assignment provisions of any contract or any lease or license entered into in the ordinary course of business;



(4)

encumbrances or restrictions existing under agreements existing on the date of the Indenture (including, without limitation, the Credit Facilities) as in effect on that date;



(5)

restrictions on the transfer of assets subject to any Lien permitted under the Indenture imposed by the holder of such Lien;



(6)

restrictions on the transfer of assets imposed under any agreement to sell such assets permitted under the Indenture to any Person pending the closing of such sale;



(7)

any instrument governing Acquired Indebtedness, which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person or the properties or assets of the Person so acquired;



(8)

any other agreement governing Indebtedness entered into after the Issue Date that contains encumbrances and restrictions that are no more materially restrictive taken as a whole than those in effect on the Issue Date pursuant to agreements in effect on the Issue Date;



(9)

customary provisions in partnership agreements, limited liability company organizational governance documents, joint venture agreements and other similar agreements entered into in the ordinary course of business that restrict the transfer of ownership interests in such partnership, limited liability company, joint venture or similar Person;



(10)

Purchase Money Indebtedness and Capitalized Lease Obligations incurred in compliance with the covenant described under "—Limitations on Additional Indebtedness" that impose restrictions of the nature described in clause (c) above on the assets acquired;



(11)

encumbrances or restrictions contained in Indebtedness of Foreign Subsidiaries permitted to be incurred under the Indenture; and



(12)

any encumbrances or restrictions imposed by any amendments or refinancings of the contracts, instruments or obligations referred to in clauses (1) through (10) above; provided that such amendments or refinancings are, in the good faith judgment of the Issuer's Board of Directors, no more materially restrictive taken as a whole with respect to such encumbrances and restrictions than those prior to such amendment or refinancing.

Limitations on Transactions with Affiliates

        The Issuer will not, and will not permit any Restricted Subsidiary to, directly or indirectly, in one transaction or a series of related transactions, sell, lease, transfer or otherwise dispose of any of its assets to, or purchase any assets from, or enter into any contract, agreement, understanding, loan,

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advance or guarantee with, or for the benefit of, any Affiliate involving aggregate payments or consideration in excess of $2.5 million (an "Affiliate Transaction"), unless:

(1)

such Affiliate Transaction is on terms that are not materially less favorable to the Issuer or the relevant Restricted Subsidiary than those that would have been obtained in a comparable transaction at such time on an arm's- length basis by the Issuer or that Restricted Subsidiary from a Person that is not an Affiliate of the Issuer or that Restricted Subsidiary; and



(2)

the Issuer delivers to the Trustee:



(a)

with respect to any Affiliate Transaction involving aggregate value in excess of $10.0 million, an Officers' Certificate certifying that such Affiliate Transaction complies with clause (1) above and a Secretary's Certificate which sets forth and authenticates a resolution that has been adopted by the Board of Directors approving such Affiliate Transaction; and



(b)

with respect to any Affiliate Transaction involving aggregate value of $35.0 million or more, the certificates described in the preceding clause (a) and a written opinion as to the fairness of such Affiliate Transaction to the Issuer or such Restricted Subsidiary from a financial point of view issued by an Independent Financial Advisor.

        The foregoing restrictions shall not apply to:

(1)

transactions exclusively between or among (a) the Issuer and one or more Restricted Subsidiaries or (b) Restricted Subsidiaries; provided, in each case, that no Affiliate of the Issuer (other than another Restricted Subsidiary) owns Equity Interests of any such Restricted Subsidiary;



(2)

reasonable director, officer and employee compensation (including bonuses) and other benefits (including retirement, health, stock option and other benefit plans) and indemnification and employment arrangements, in each case approved by the Board of Directors and payments to Parent or on behalf of Parent to pay such amounts incurred by Parent;



(3)

payments by the Issuer and/or one or more Subsidiaries to any other Person with which the Issuer or such Subsidiaries are required or permitted to file a consolidated tax return or with which the Issuer or such Subsidiaries are part of a consolidated group for tax purposes, to be used by such Person to pay taxes, and which payments by the Issuer and such Subsidiaries are not in excess of the tax liabilities that would have been payable by them on a stand-alone basis;



(4)

payments by the Issuer to or on behalf of Parent in an amount sufficient to pay out-of-pocket legal, accounting and filing costs, franchise taxes, general operating and overhead expenses and other fees required to maintain the corporate existence of Parent or that are otherwise attributable to the ownership or operation of the Issuer and fees and expenses related to any unsuccessful securities offering of Parent actually incurred by Parent;



(5)

any agreement described in this Prospectus as in effect as of the Issue Date or as thereafter amended in a manner not materially adverse to the Holders when taken as a whole;



(6)

any Restricted Payments which are made in accordance with the covenant described under "—Limitations on Restricted Payments" and Permitted Investments;



(7)

any transaction with an Affiliate where the only consideration paid by the Issuer or any Restricted Subsidiary is Equity Interests of Parent or Qualified Equity Interests;

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(8)

the Transactions and the payment of fees and other expenses to be paid in connection with the consummation of the Transactions as described in this Prospectus; or



(9)

so long as no Default exists, payments by the Issuer or on behalf of Parent to Sponsor and its Affiliates pursuant to the Advisory Agreement as in effect on the Issue Date or as thereafter amended in a manner not materially adverse to the Holders when taken as a whole.

Limitations on Liens

        The Issuer shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, create, incur, assume or permit or suffer to exist any Lien of any nature whatsoever (other than Permitted Liens) against any assets of the Issuer or any Restricted Subsidiary (including Equity Interests of a Restricted Subsidiary), securing any Indebtedness whether owned at the Issue Date or thereafter acquired, or any proceeds therefrom, or assign or otherwise convey any right to receive income or profits therefrom, unless contemporaneously therewith:

(1)

in the case of any Lien securing an obligation that ranks pari passu with the Notes or a Note Guarantee, effective provision is made to secure the Notes or such Note Guarantee, as the case may be, at least equally and ratably with or prior to such obligation with a Lien on the same assets of the Issuer or such Restricted Subsidiary, as the case may be; and



(2)

in the case of any Lien securing an obligation that is subordinated in right of payment to the Notes or a Note Guarantee, effective provision is made to secure the Notes or such Note Guarantee, as the case may be, with a Lien on the same assets of the Issuer or such Restricted Subsidiary, as the case may be, that is prior to the Lien securing such subordinated obligation,

        in each case, for so long as such obligation is secured by such Lien.

Limitations on Asset Sales

        The Issuer will not, and will not permit any Restricted Subsidiary to, directly or indirectly, consummate any Asset Sale unless:

(1)

the Issuer or such Restricted Subsidiary receives consideration at the time of such Asset Sale at least equal to the Fair Market Value of the assets included in such Asset Sale; and



(2)

at least 75% of the total consideration received in such Asset Sale consists of cash or Cash Equivalents.

        For purposes of clause (2), the following shall be deemed to be cash:

(a)

the amount (without duplication) of any Indebtedness (other than Subordinated Indebtedness) of the Issuer or such Restricted Subsidiary that is expressly assumed by the transferee in such Asset Sale and with respect to which the Issuer or such Restricted Subsidiary, as the case may be, is unconditionally released by the holder of such Indebtedness,



(b)

the amount of any securities received from such transferee that are within 365 days converted by the Issuer or such Restricted Subsidiary to cash (to the extent of the cash actually so received), and



(c)

the Fair Market Value of (i) any assets (other than securities) received by the Issuer or any Restricted Subsidiary to be used by it in a Permitted Business, (ii) Equity Interests in a Person that is a Restricted Subsidiary or in a Person engaged in a Permitted Business that shall become a Restricted Subsidiary immediately upon the acquisition of such Person by the Issuer or (iii) a combination of (i) and (ii).

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        If at any time any non-cash consideration received by the Issuer or any Restricted Subsidiary of the Issuer, as the case may be, in connection with any Asset Sale is repaid or converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then the date of such repayment, conversion or disposition shall be deemed to constitute the date of an Asset Sale hereunder and the Net Available Proceeds thereof shall be applied in accordance with this covenant.

        If the Issuer or any Restricted Subsidiary engages in an Asset Sale, the Issuer or such Restricted Subsidiary shall, no later than 365 days following the consummation thereof, apply all or any of the Net Available Proceeds therefrom to:

(1)

repay obligations under the Credit Agreement, and in the case of any such repayment under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility;



(2)

repay any Indebtedness which was secured by the assets sold in such Asset Sale;



(3)

repay any Pari Passu Indebtedness that is secured by a Lien (to the extent of the value of the assets (excluding any assets also pledged to secure the Notes or any Note Guarantee pursuant to clause (1) of the covenant described under "—Limitations on Liens) secured by such Lien), which Lien is permitted by the Indenture;



(4)

repay any Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Issuer or another Restricted Subsidiary; and/or



(5)

(A) invest all or any part of the Net Available Proceeds thereof in the purchase of assets (other than securities) to be used by the Issuer or any Restricted Subsidiary in a Permitted Business, (B) acquire Equity Interests in a Person that is a Restricted Subsidiary or in a Person engaged in a Permitted Business that shall become a Restricted Subsidiary immediately upon the consummation of such acquisition, (C) make capital expenditures or (D) a combination of (A), (B) and/or (C);

provided that the Issuer and its Restricted Subsidiaries will be deemed to have complied with the provisions described in clause (5) of this paragraph if and to the extent that, within 365 days after the Asset Sale that generated the Net Available Proceeds, the Issuer or such Restricted Subsidiary has entered into and not abandoned or rejected a binding agreement to effect the provisions of clause (5) of this paragraph, and the Net Available Proceeds are applied as described in clause (5) of this paragraph within 180 days after the end of such 365-day period; provided that if any Net Available Proceeds are not so applied, then such Net Available Proceeds shall constitute Excess Proceeds (as defined below) on such 180th day.

        The amount of Net Available Proceeds not applied or invested as provided in this paragraph will constitute "Excess Proceeds."

        When the aggregate amount of Excess Proceeds equals or exceeds $25.0 million, the Issuer will be required to make within 10 Business Days thereof, an offer to purchase from all Holders and, if applicable, redeem (or make an offer to do so) any Pari Passu Indebtedness of the Issuer the provisions of which require the Issuer to redeem such Indebtedness with the proceeds from any Asset Sales (or offer to do so), in an aggregate principal amount of Notes and such Pari Passu Indebtedness equal to the amount of such Excess Proceeds as follows:

(1)

the Issuer will (a) make an offer to purchase (a "Net Proceeds Offer") to all Holders in accordance with the procedures set forth in the Indenture, and (b) redeem (or make an offer to do so) any such other Pari Passu Indebtedness, pro rata in proportion to the respective principal amounts of the Notes and such other Indebtedness required to be redeemed, the

159

maximum principal amount of Notes and Pari Passu Indebtedness that may be redeemed out of the amount (the "Payment Amount") of such Excess Proceeds;

(2)

the offer price for the Notes will be payable in cash in an amount equal to 100% of the principal amount of the Notes tendered pursuant to a Net Proceeds Offer, plus accrued and unpaid interest thereon, if any, to the date such Net Proceeds Offer is consummated (the "Offered Price"), in accordance with the procedures set forth in the Indenture and the redemption price for such Pari Passu Indebtedness (the "Pari Passu Indebtedness Price") shall be as set forth in the related documentation governing such Indebtedness;



(3)

if the aggregate Offered Price of Notes validly tendered and not withdrawn by Holders thereof exceeds the pro rata portion of the Payment Amount allocable to the Notes, Notes to be purchased will be selected on a pro rata basis; and



(4)

upon completion of such Net Proceeds Offer in accordance with the foregoing provisions, the amount of Excess Proceeds with respect to which such Net Proceeds Offer was made shall be deemed to be zero.

        To the extent that the sum of the aggregate Offered Price of Notes tendered pursuant to a Net Proceeds Offer and the aggregate Pari Passu Indebtedness Price paid to the holders of such Pari Passu Indebtedness is less than the Payment Amount relating thereto (such shortfall constituting a "Net Proceeds Deficiency"), the Issuer may use the Net Proceeds Deficiency, or a portion thereof, for general corporate purposes, subject to the provisions of the Indenture.

        Pending the final application of any Net Available Proceeds pursuant to this covenant, the holder of such Net Available Proceeds may apply such Net Available Proceeds temporarily to reduce Indebtedness outstanding under a revolving credit facility or otherwise invest such Net Available Proceeds in Cash Equivalents.

        The Issuer will comply with applicable tender offer rules, including the requirements of Rule 14e-1 under the Exchange Act and any other applicable laws and regulations in connection with the purchase of Notes pursuant to a Net Proceeds Offer. To the extent that the provisions of any securities laws or regulations conflict with the "Limitations on Asset Sales" provisions of the Indenture, the Issuer shall comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under the "Limitations on Asset Sales" provisions of the Indenture by virtue of this compliance.

Limitations on Designation of Unrestricted Subsidiaries

        The Issuer may designate any Subsidiary of the Issuer as an "Unrestricted Subsidiary" under the Indenture (a "Designation") only if:

(1)

no Default shall have occurred and be continuing at the time of or after giving effect to such Designation; and



(2)

the Issuer would be permitted to make, at the time of such Designation, an Investment in an amount (the "Designation Amount") equal to the Fair Market Value of the Issuer's proportionate interest in such Subsidiary on such date.

        No Subsidiary shall be Designated as an "Unrestricted Subsidiary" unless such Subsidiary:

(1)

has no Indebtedness other than Non-Recourse Debt;



(2)

is not party to any agreement, contract, arrangement or understanding with the Issuer or any Restricted Subsidiary unless the terms of the agreement, contract, arrangement or understanding are no less favorable to the Issuer or the Restricted Subsidiary taken as a whole than those that might be obtained at the time from Persons who are not Affiliates;

160

(3)

is a Person with respect to which neither the Issuer nor any Restricted Subsidiary has any direct or indirect obligation (a) to subscribe for additional Equity Interests or (b) to maintain or preserve the Person's financial condition or to cause the Person to achieve any specified levels of operating results; and



(4)

has not guaranteed or otherwise directly or indirectly provided credit support for any Indebtedness of the Issuer or any Restricted Subsidiary, except for any guarantee given solely to support the pledge by the Issuer or any Restricted Subsidiary of the Equity Interests of such Unrestricted Subsidiary, which guarantee is not recourse to the Issuer or any Restricted Subsidiary.

        If, at any time, any Unrestricted Subsidiary fails to meet the preceding requirements as an Unrestricted Subsidiary, it shall thereafter cease to be an Unrestricted Subsidiary for purposes of the Indenture and any Indebtedness of the Subsidiary and any Liens on assets of such Subsidiary shall be deemed to be incurred by a Restricted Subsidiary as of such date and, if the Indebtedness is not permitted to be incurred under the covenant described under "—Limitations on Additional Indebtedness" or the Lien is not permitted under the covenant described under "—Limitations on Liens," the Issuer shall be in default of the applicable covenant.

        The Issuer may designate an Unrestricted Subsidiary as a Restricted Subsidiary (a "Redesignation") only if:

(1)

no Default shall have occurred and be continuing at the time of and after giving effect to such Redesignation; and



(2)

all Liens, Indebtedness and Investments of such Unrestricted Subsidiary outstanding immediately following such Redesignation would, if incurred or made at such time, have been permitted to be incurred or made for all purposes of the Indenture.

        All Designations and Redesignations must be evidenced by resolutions of the Board of Directors of the Issuer, delivered to the Trustee certifying compliance with the foregoing provisions.

Limitations on Mergers, Consolidations, Etc.

        The Issuer will not, directly or indirectly, in a single transaction or a series of related transactions, consolidate or merge with or into another Person, or sell, lease, transfer, convey or otherwise dispose of or assign all or substantially all of the assets of the Issuer or the Issuer and the Restricted Subsidiaries (taken as a whole), unless:

(1)

either:



(a)

the Issuer will be the surviving or continuing Person; or



(b)

the Person formed by or surviving such consolidation or merger or to which such sale, lease, conveyance or other disposition shall be made (collectively, the "Successor") is a corporation or limited liability company organized and existing under the laws of any State of the United States of America or the District of Columbia, and the Successor expressly assumes, by supplemental indenture in form and substance satisfactory to the Trustee, all of the obligations of the Issuer under the Notes, the Indenture and the Registration Rights Agreement;



(2)

immediately after giving effect to such transaction and the assumption of the obligations as set forth in clause (1)(b) above and the incurrence of any Indebtedness to be incurred in connection therewith, no Default shall have occurred and be continuing;



(3)

immediately after and giving effect to such transaction and the assumption of the obligations set forth in clause (1)(b) above and the incurrence of any Indebtedness to be incurred in

161

connection therewith, and the use of any net proceeds therefrom on a pro forma basis, either (x) the Issuer or the Successor, as the case may be, could incur $1.00 of additional Indebtedness pursuant to the Coverage Ratio Exception or (y) the Consolidated Interest Coverage Ratio of the Issuer or the Successor, as the case may be, would be at least equal to the Consolidated Interest Coverage Ratio of the Issuer immediately prior to such transaction.

        For purposes of this covenant, any Indebtedness of the Successor which was not Indebtedness of the Issuer immediately prior to the transaction shall be deemed to have been incurred in connection with such transaction.

        Clause (3) above shall not apply to the merger of the Issuer with a Subsidiary of Parent solely for the purpose of reincorporating the Issuer in another jurisdiction of the United States.

        Parent will not, directly or indirectly, in a single transaction or a series of related transactions, consolidate or merge with or into another Person, or sell, lease, transfer, convey or otherwise dispose of or assign all or substantially all of the assets of Parent and its Subsidiaries (taken as a whole) unless, in either case:

(1)

either:



(a)

Parent will be the surviving or continuing Person; or



(b)

the Person formed by or surviving such consolidation or merger or to which such sale, lease, conveyance or other disposition shall be made (collectively, the "Parent Successor") is a corporation, limited liability company or limited partnership organized and existing under the laws of any State of the United States of America or the District of Columbia, and the Parent Successor expressly assumes, by supplemental indenture in form and substance reasonably satisfactory to the Trustee, all of the obligations of Parent under the Notes, the Indenture and the Registration Rights Agreement; and



(2)

immediately after giving effect to such transaction, no Default shall have occurred and be continuing.

        Except as provided in the seventh paragraph under the caption "—Note Guarantees," no Guarantor (other than Parent, as provided above) may consolidate with or merge with or into (whether or not such Guarantor is the surviving Person) another Person, unless:

(1)

either:



(a)

such Guarantor will be the surviving or continuing Person; or



(b)

the Person formed by or surviving any such consolidation or merger is another Guarantor or assumes, by supplemental indenture in form and substance reasonably satisfactory to the Trustee, all of the obligations of such Guarantor under the Note Guarantee of such Guarantor, the Indenture and the Registration Rights Agreement; and



(2)

immediately after giving effect to such transaction, no Default shall have occurred and be continuing.

        For purposes of the foregoing, the transfer (by lease, assignment, sale or otherwise, in a single transaction or series of transactions) of all or substantially all of the properties or assets of one or more Restricted Subsidiaries, the Equity Interests of which constitute all or substantially all of the properties and assets of the Issuer, will be deemed to be the transfer of all or substantially all of the properties and assets of the Issuer or Parent, as the case may be.

        Upon any consolidation, combination or merger of the Issuer or a Guarantor, or any transfer of all or substantially all of the assets of the Issuer or Parent in accordance with the foregoing, in which the Issuer or such Guarantor is not the continuing obligor under the Notes or its Note Guarantee, the

162

surviving entity formed by such consolidation or into which the Issuer or such Guarantor is merged or the entity to which the conveyance, lease or transfer is made will succeed to, and be substituted for, and may exercise every right and power of, the Issuer or such Guarantor under the Indenture, the Notes and the Note Guarantees with the same effect as if such surviving entity had been named therein as the Issuer or such Guarantor, and, except in the case of a lease, the Issuer or such Guarantor, as the case may be, will be released from the obligation to pay the principal of and interest on the Notes or in respect of its Note Guarantee, as the case may be, and all of the Issuer's or such Guarantor's other obligations and covenants under the Notes, the Indenture and its Note Guarantee, if applicable.

        Notwithstanding the foregoing, any Restricted Subsidiary may consolidate with, merge with or into, or convey, transfer or lease, in one transaction or a series of transactions, all or substantially all of its assets to, the Issuer or another Restricted Subsidiary.

Additional Note Guarantees

        If, after the Issue Date, (a) the Issuer or any Restricted Subsidiary shall acquire or create another Subsidiary (other than an Excluded Subsidiary), (b) any Unrestricted Subsidiary is designated a Restricted Subsidiary (other than an Excluded Subsidiary) or (c) the Issuer otherwise elects to have any Restricted Subsidiary become a Guarantor, then, in each such case, the Issuer shall cause such Restricted Subsidiary to:

(1)

execute and deliver to the Trustee a supplemental indenture in form and substance reasonably satisfactory to the Trustee pursuant to which such Restricted Subsidiary shall unconditionally guarantee all of the Issuer's obligations under the Notes and the Indenture to the same extent as the Note Guarantees; and



(2)

deliver to the Trustee one or more opinions of counsel that such supplemental indenture (a) has been duly authorized, executed and delivered by such Restricted Subsidiary and (b) constitutes a valid and legally binding obligation of such Restricted Subsidiary in accordance with its terms.

Conduct of Business

        The Issuer will not, and will not permit any Restricted Subsidiary to, engage in any business other than a Permitted Business.

Reports

        Whether or not required by the SEC, so long as any Notes are outstanding, the Issuer or Parent will furnish to the Holders of Notes, or file electronically with the SEC through the SEC's Electronic Data Gathering, Analysis and Retrieval System (or any successor system), within 15 days of the time periods that would be applicable to the Issuer or Parent, as applicable, if it were subject to Section 13(a) or 15(d) of the Exchange Act as a non-accelerated filer:

(1)

all quarterly and annual financial information that would be required to be contained in a filing with the SEC on Forms 10-Q and 10-K if the Issuer or Parent, as applicable, were required to file these Forms, including a "Management's discussion and analysis of financial condition and results of operations" and, with respect to the annual information only, a report on the annual financial statements by the Issuer's or Parent's, as applicable, certified independent accountants; and



(2)

all current reports that would be required to be filed with the SEC on Form 8-K if the Issuer or Parent were required to file these reports.

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        In addition, whether or not required by the SEC, the Issuer will file a copy of all of the information and reports referred to in clauses (1) and (2) above with the SEC for public availability within 15 days of the time periods specified in the SEC's rules and regulations for a non-accelerated filer required to file reports under Section 13(a) or 15(d) of the Exchange Act (unless the SEC will not accept the filing) and make the information available to prospective investors upon request. The Issuer agrees that it will not take any action (including, following the Registered Exchange Offer, terminating its registration under Section 15(d) of the Exchange Act) for the purpose of causing the SEC not to accept such filings. The Issuer and the Guarantors have agreed that, for so long as any Notes remain outstanding, the Issuer will furnish to the Holders and to prospective investors, upon their request, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act.

        Notwithstanding the foregoing, such requirements shall be deemed satisfied prior to the commencement of the Registered Exchange Offer or the effectiveness of the shelf registration statement required by the Registration Rights Agreement by (1) the filing with the SEC of the exchange offer registration statement or shelf registration statement (or any other similar registration statement), and any amendments thereto, with such financial information that satisfies Regulation S-X of the Securities Act or (2) by posting publicly on its website, within 15 days of the time periods after the Issuer or Parent would have been required to file annual and interim reports with the SEC as a non-accelerated filer, the information (including a "Management's discussion and analysis of financial condition and results of operations" section) that would be required to be included in such reports, subject to exceptions consistent with the presentation of financial information in this Prospectus.

        Neither the Issuer nor any Guarantor shall provide information to any Person or the public not otherwise authorized to receive such information relative to performance requirements or performance contracts when such information requires access to information classified pursuant to Executive Order 12356, April 2, 1982 (47 Federal Register 14874, April 6, 1982), or successor or predecessor orders, or the Atomic Energy Act of 1954 (as amended). Neither the Issuer nor any Guarantor shall be required to acknowledge to any Person or the public not otherwise authorized to receive such information the existence or non-existence of work under special access or compartmented programs. Notwithstanding the foregoing, should the Issuer or any Guarantor withhold information permitted pursuant to this paragraph, such entity shall nonetheless use its commercially reasonable efforts to comply with the rules and regulations of the SEC relating to the information to be provided pursuant to the first paragraph above, but shall not be obligated to make disclosures required by the rules and regulations of the SEC to the extent such disclosures would conflict with the two preceding sentences.

Events Of Default

        Each of the following is an "Event of Default":

(1)

failure by the Issuer to pay interest on any of the Notes when it becomes due and payable and the continuance of any such failure for 30 days;



(2)

failure by the Issuer to pay the principal on any of the Notes when it becomes due and payable, whether at stated maturity, upon redemption, upon purchase, upon acceleration or otherwise;



(3)

failure by the Issuer to comply with any of its agreements or covenants described above under "—Certain Covenants—Limitations on Mergers, Consolidations, Etc.," or in respect of its obligations to make a Change of Control Offer as described above under "—Change of Control";



(4)

failure by the Issuer to comply with any other agreement or covenant in the Indenture and continuance of this failure for 60 days after notice of the failure has been given to the Issuer

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by the Trustee or by the Holders of at least 25% of the aggregate principal amount of the Notes then outstanding;

(5)

default under any mortgage, indenture or other instrument or agreement under which there may be issued or by which there may be secured or evidenced Indebtedness of the Issuer or any Restricted Subsidiary, whether such Indebtedness now exists or is incurred after the Issue Date, which default:



(a)

is caused by a failure to pay at final maturity, principal on such Indebtedness within the applicable express grace period and any extensions thereof,



(b)

results in the acceleration of such Indebtedness prior to its express final maturity, or



(c)

results in the commencement of judicial proceedings to foreclose upon, or to exercise remedies under applicable law or applicable security documents to take ownership of, the assets securing such Indebtedness, and

        in each case, the principal amount of such Indebtedness, together with any other Indebtedness with respect to which an event described in clause (a), (b) or (c) has occurred and is continuing, aggregates $35.0 million or more;

(6)

one or more judgments or orders that exceed $35.0 million in the aggregate (net of amounts covered by insurance or bonded) for the payment of money have been entered by a court or courts of competent jurisdiction against the Issuer or any Restricted Subsidiary and such judgment or judgments have not been satisfied, stayed, annulled or rescinded within 60 days of being entered;



(7)

the Issuer or any Significant Subsidiary pursuant to or within the meaning of any Bankruptcy Law:



(a)

commences a voluntary case,



(b)

consents to the entry of an order for relief against it in an involuntary case,



(c)

consents to the appointment of a Custodian of it or for all or substantially all of its assets, or



(d)

makes a general assignment for the benefit of its creditors;



(8)

a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:



(a)

is for relief against the Issuer or any Significant Subsidiary as debtor in an involuntary case,



(b)

appoints a Custodian of the Issuer or any Significant Subsidiary or a Custodian for all or substantially all of the assets of the Issuer or any Significant Subsidiary, or



(c)

orders the liquidation of the Issuer or any Significant Subsidiary,

        and the order or decree remains unstayed and in effect for 60 days; or

(9)

any Note Guarantee of any Significant Subsidiary ceases to be in full force and effect (other than in accordance with the terms of such Note Guarantee and the Indenture) or is declared null and void and unenforceable or found to be invalid or any Guarantor denies its liability under its Note Guarantee (other than by reason of release of a Guarantor from its Note Guarantee in accordance with the terms of the Indenture and the Note Guarantee).

        If an Event of Default (other than an Event of Default specified in clause (7) or (8) above with respect to the Issuer), shall have occurred and be continuing under the Indenture, the Trustee, by written notice to the Issuer, or the Holders of at least 25% in aggregate principal amount of the Notes

165

then outstanding by written notice to the Issuer and the Trustee, may declare (an "acceleration declaration") all amounts owing under the Notes to be due and payable immediately. Upon such declaration of acceleration, the aggregate principal of and accrued and unpaid interest on the outstanding Notes shall become due and payable immediately; provided, however, that after such acceleration, but before a judgment or decree based on acceleration, the Holders of a majority in aggregate principal amount of such outstanding Notes may, under certain circumstances, rescind and annul such acceleration if all Events of Default, other than the nonpayment of accelerated principal and interest, have been cured or waived as provided in the Indenture. If an Event of Default specified in clause (7) or (8) with respect to the Issuer occurs, all outstanding Notes shall become due and payable without any further action or notice.

        The Trustee shall, within 30 days after the occurrence of any Default with respect to the Notes known to it, give the Holders notice of all uncured Defaults thereunder known to it; provided, however, that, except in the case of an Event of Default in payment with respect to the Notes or a Default in complying with "—Certain Covenants—Limitations on Mergers, Consolidations, Etc.," the Trustee shall be protected in withholding such notice if and so long as a committee of its trust officers in good faith determines that the withholding of such notice is in the interest of the Holders.

        No Holder will have any right to institute any proceeding with respect to the Indenture or for any remedy thereunder, unless the Trustee:

(1)

has failed to act for a period of 60 days after receiving written notice of a continuing Event of Default by such Holder and a request to act by Holders of at least 25% in aggregate principal amount of Notes outstanding;



(2)

has been offered indemnity satisfactory to it in its reasonable judgment; and



(3)

has not received from the Holders of a majority in aggregate principal amount of the outstanding Notes a direction inconsistent with such request.

        However, such limitations do not apply to a suit instituted by a Holder of any Note for enforcement of payment of the principal of or interest on such Note on or after the due date therefor.

        The Issuer is required to deliver to the Trustee annually a statement regarding compliance with the Indenture and, upon any Officer of the Issuer becoming aware of any Default, a statement specifying such Default and what action, if any, the Issuer is taking or proposes to take with respect thereto.

Legal Defeasance And Covenant Defeasance

        The Issuer may, at its option and at any time, elect to have its obligations and the obligations of the Guarantors discharged with respect to the outstanding Notes ("Legal Defeasance"). Legal Defeasance means that the Issuer and the Guarantors shall be deemed to have paid and discharged the entire Indebtedness represented by the Notes and the Note Guarantees and the Indenture shall cease to be of further effect as to all outstanding Notes and Note Guarantees, except as to:

(1)

rights of Holders to receive payments in respect of the principal of and interest on the Notes when such payments are due from the trust funds referred to below,



(2)

the Issuer's obligations with respect to the Notes concerning issuing temporary Notes, registration of Notes, mutilated, destroyed, lost or stolen Notes, and the maintenance of an office or agency for payment and money for security payments held in trust,



(3)

the rights, powers, trust, duties, and immunities of the Trustee, and the Issuer's obligation in connection therewith, and



(4)

the Legal Defeasance provisions of the Indenture.

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        In addition, the Issuer may, at its option and at any time, elect to have its obligations and the obligations of the Guarantors released with respect to most of the covenants under the Indenture, except as described otherwise in the Indenture ("Covenant Defeasance"), and thereafter any omission to comply with such obligations shall not constitute a Default. In the event Covenant Defeasance occurs, certain Events of Default (not including non-payment, bankruptcy, receivership, rehabilitation and insolvency events) also will no longer apply. The Issuer may exercise its Legal Defeasance option regardless of whether it previously exercised Covenant Defeasance.

        In order to exercise either Legal Defeasance or Covenant Defeasance:

(1)

the Issuer must irrevocably deposit with the Trustee, in trust, for the benefit of the Holders, U.S. legal tender, U.S. Government Obligations or a combination thereof, in such amounts as will be sufficient (without reinvestment) in the opinion of a nationally recognized firm of independent public accountants selected by the Issuer, to pay the principal of and interest and premium, if any, on the Notes on the stated date for payment or on the redemption date of the Notes,



(2)

in the case of Legal Defeasance, the Issuer shall have delivered to the Trustee an opinion of counsel in the United States reasonably acceptable to the Trustee confirming that:



(a)

the Issuer has received from, or there has been published by, the Internal Revenue Service, a ruling, or



(b)

since the date of the Indenture, there has been a change in the applicable U.S. federal income tax law,

        in either case to the effect that, subject to customary assumptions and qualifications, and based thereon the Holders will not recognize income, gain or loss for U.S. federal income tax purposes as a result of the Legal Defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred,

(3)

in the case of Covenant Defeasance, the Issuer shall have delivered to the Trustee an opinion of counsel in the United States reasonably acceptable to the Trustee confirming that, subject to customary assumptions and qualifications, the Holders will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such Covenant Defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if the Covenant Defeasance had not occurred,



(4)

no Default shall have occurred and be continuing on the date of such deposit (other than a Default resulting from the borrowing of funds to be applied to such deposit and any similar deposit relating to other Indebtedness that is concurrently being defeased and, in each case, the granting of Liens in connection therewith),



(5)

the Legal Defeasance or Covenant Defeasance shall not result in a breach or violation of, or constitute a Default under the Indenture or a default under any other material agreement or instrument to which the Issuer or any of its Subsidiaries is a party or by which the Issuer or any of its Subsidiaries is bound (other than any such Default or default resulting solely from the borrowing of funds to be applied to such deposit and any similar deposit relating to other Indebtedness that is concurrently being defeased and, in each case, the granting of Liens in connection therewith),



(6)

the Issuer shall have delivered to the Trustee an Officers' Certificate stating that the deposit was not made by it with the intent of preferring the Holders over any other of its creditors or with the intent of defeating, hindering, delaying or defrauding any other of its creditors or others, and

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(7)

the Issuer shall have delivered to the Trustee an Officers' Certificate and an opinion of counsel (which opinion of counsel may be subject to customary assumptions and qualifications), each stating that the conditions provided for in, in the case of the Officers' Certificate, clauses (1) through (6) and, in the case of the opinion of counsel, clauses (2) and/or (3) and (5) of this paragraph have been complied with.

        If the funds deposited with the Trustee to effect Covenant Defeasance are insufficient to pay the principal of and interest on the Notes when due, then our obligations and the obligations of Guarantors under the Indenture will be revived and no such defeasance will be deemed to have occurred.

Satisfaction And Discharge

        The Indenture will be discharged and will cease to be of further effect (except as to rights of registration of transfer or exchange of Notes which shall survive until all Notes have been canceled) as to all outstanding Notes when either

(1)

all the Notes that have been authenticated and delivered (except lost, stolen or destroyed Notes which have been replaced or paid and Notes for whose payment money has been deposited in trust or segregated and held in trust by the Issuer and thereafter repaid to the Issuer or discharged from this trust) have been delivered to the Trustee for cancellation, or



(2)

(a) all Notes not delivered to the Trustee for cancellation otherwise (i) have become due and payable, (ii) will become due and payable, or may be called for redemption, within one year or (iii) have been called for redemption pursuant to the provisions described under "—Optional Redemption," and, in any case, the Issuer has irrevocably deposited or caused to be deposited with the Trustee as trust funds, in trust solely for the benefit of the Holders, U.S. legal tender, U.S. Government Obligations or a combination thereof, in such amounts as will be sufficient (without consideration of any reinvestment of interest) to pay and discharge the entire Indebtedness (including all principal and accrued interest and premium, if any) on the Notes not theretofore delivered to the Trustee for cancellation,



(b)

the Issuer has paid all sums payable by it under the Indenture, and



(c)

the Issuer has delivered irrevocable instructions to the Trustee to apply the deposited money toward the payment of the Notes at maturity or on the date of redemption, as the case may be.

        In addition, the Issuer must deliver an Officers' Certificate and an opinion of counsel stating that all conditions precedent to satisfaction and discharge have been complied with.

Transfer And Exchange

        A Holder will be able to register the transfer of or exchange Notes only in accordance with the provisions of the Indenture. The Registrar may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and to pay any taxes and fees required by law or permitted by the Indenture. The Issuer is not required (1) to register the transfer of or exchange any Note selected for redemption, (2) to register the transfer of or exchange any Note for a period of 15 days before a selection of Notes to be redeemed or (3) to register the transfer or exchange of a Note between a record date and the next succeeding interest payment date.

        The Notes will be issued in registered form and the registered Holder will be treated as the owner of such Note for all purposes. As described under "—Book-Entry, Delivery and Form of Securities", except in limited circumstances, the Notes will only be issued in global form and deposited with a nominee of DTC.

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Amendment, Supplement And Waiver

        Subject to certain exceptions, the Indenture, the Note Guarantees or the Notes may be amended with the consent (which may include consents obtained in connection with a tender offer or exchange offer for Notes) of the Holders of at least a majority in principal amount of the Notes then outstanding, and any existing Default under, or compliance with any provision of, the Indenture, the Note Guarantees or the Notes may be waived (other than any continuing Default in the payment of the principal or interest on the Notes) with the consent (which may include consents obtained in connection with a tender offer or exchange offer for Notes) of the Holders of a majority in principal amount of the Notes then outstanding; provided that, without the consent of each Holder affected, no amendment or waiver may:

(1)

reduce, or change the maturity, of the principal of any Note;



(2)

reduce the rate of or extend the time for payment of interest on any Note;



(3)

reduce any premium payable upon optional redemption of the Notes or change the date on which any Notes are subject to redemption (other than provisions relating to the purchase of Notes described above under "—Change of Control" and "—Certain Covenants—Limitations on Asset Sales," except that if a Change of Control has occurred, no amendment or other modification of the obligation of the Issuer to make a Change of Control Offer relating to such Change of Control shall be made without the consent of each Holder of the Notes affected);



(4)

make any Note payable in money or currency other than that stated in the Notes;



(5)

modify or change any provision of the Indenture or the related definitions to affect the ranking of the Notes or any Note Guarantee in a manner that adversely affects the Holders;



(6)

reduce the percentage of Holders necessary to consent to an amendment or waiver to the Indenture or the Notes;



(7)

waive a default in the payment of principal of or premium or interest on any Notes (except a rescission of acceleration of the Notes by the Holders thereof as provided in the Indenture and a waiver of the payment default that resulted from such acceleration);



(8)

impair the rights of Holders to receive payments of principal of or interest on the Notes on or after the due date therefor or to institute suit for the enforcement of any payment on the Notes;



(9)

release all or substantially all the Guarantors from their obligations under their Note Guarantee or the Indenture, except as permitted by the Indenture; or



(10)

make any change in these amendment and waiver provisions.

        Notwithstanding the foregoing, the Issuer and the Trustee may amend the Indenture, the Note Guarantees or the Notes without the consent of any Holder, to cure any ambiguity, defect or inconsistency; to provide for uncertificated Notes in addition to or in place of certificated Notes; to provide for the assumption of the Issuer's or a Guarantor's obligations to the Holders in the case of a merger, consolidation or sale of all or substantially all of the assets in accordance with "—Certain Covenants—Limitations on Mergers, Consolidations, Etc."; to release any Subsidiary Guarantor from any of its obligations under its Note Guarantee and the Indenture (to the extent permitted by the Indenture); to release the Parent from any of its obligations under its Note Guarantee and the Indenture; to add covenants for the benefit of the Holders or to surrender any right or power conferred upon the Issuer or any Guarantor; to evidence and provide for the acceptance and appointment under the Indenture of a successor Trustee; to conform the Indenture, the Note Guarantees or the Notes to this "Description of the Exchange Notes"; to make any change that does

169

not materially adversely affect the rights of any Holder; or in the case of the Indenture, to maintain the qualification of the Indenture under the Trust Indenture Act.

        The consent of the Holders is not necessary under the Indenture to approve the particular form of any proposed amendment, supplement or waiver. It is sufficient if such consent approves the substance of the proposed amendment, supplement or waiver. A consent to any amendment or waiver under the Indenture by any Holder given in connection with an exchange (in the case of an exchange offer) or a tender (in the case of a tender offer) of such Holder's Notes will not be rendered invalid by such tender or exchange. After an amendment, supplement or waiver under the Indenture becomes effective, the Issuer is required to mail to the Holders a notice briefly describing such amendment, supplement or waiver. However, the failure to give such notice to all Holders, or any defect in the notice will not impair or affect the validity of the amendment, supplement or waiver.

No Personal Liability Of Directors, Officers, Employees And Stockholders

        No director, officer, employee, member, incorporator or stockholder of the Issuer or any Guarantor will have any liability for any obligations of the Issuer under the Notes or the Indenture or of any Guarantor under its Note Guarantee or for any claim based on, in respect of, or by reason of, such obligations or their creation. Each Holder by accepting a Note waives and releases all such liability. The waiver and release are part of the consideration for issuance of the Notes and the Note Guarantees. The waiver may not be effective to waive liabilities under the federal securities laws. It is the view of the SEC that this type of waiver is against public policy.

Concerning The Trustee

        The Bank of New York Mellon Trust Company, N.A. is the Trustee under the Indenture and has been appointed by the Issuer as Registrar and Paying Agent with regard to the Notes. The Indenture contains certain limitations on the rights of the Trustee, should it become a creditor of the Issuer, to obtain payment of claims in certain cases, or to realize on certain assets received in respect of any such claim as security or otherwise. The Trustee will be permitted to engage in other transactions; however, if it acquires any conflicting interest (as defined in the Indenture), it must eliminate such conflict within 90 days, apply to the SEC for permission to continue or resign.

        The Holders of a majority in principal amount of the then outstanding Notes will have the right to direct the time, method and place of conducting any proceeding for exercising any remedy available to the Trustee, subject to certain exceptions. The Indenture will provide that, in case an Event of Default occurs and is not cured, the Trustee will be required, in the exercise of its power, to use the degree of care of a prudent person in similar circumstances in the conduct of such person's own affairs. Subject to such provisions, the Trustee will be under no obligation to exercise any of its rights or powers under the Indenture at the request of any Holder, unless such Holder shall have offered to the Trustee security and indemnity reasonably satisfactory to the Trustee.

Governing Law

        The Indenture, the Notes and the Note Guarantees are governed by, and construed in accordance with, the laws of the State of New York.

Certain Definitions

        Set forth below is a summary of certain of the defined terms used in the Indenture. Reference is made to the Indenture for the full definition of all such terms.

        "8% Senior Subordinated Notes" means Communications & Power Industries, Inc.'s 8% Senior Subordinated Notes due 2011 outstanding on the date of this Prospectus.

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        "Acquired Indebtedness" means (1) with respect to any Person that becomes a Restricted Subsidiary after the Issue Date, Indebtedness of such Person and its Subsidiaries existing at the time such Person becomes a Restricted Subsidiary that was not incurred in connection with, or in contemplation of, such Person becoming a Restricted Subsidiary and (2) with respect to the Issuer or any Restricted Subsidiary, any Indebtedness of a Person (other than the Issuer or a Restricted Subsidiary) existing at the time such Person is merged with or into the Issuer or a Restricted Subsidiary, or Indebtedness expressly assumed by the Issuer or any Restricted Subsidiary in connection with the acquisition of an asset or assets from another Person, which Indebtedness was not, in any case, incurred by such other Person in connection with, or in contemplation of, such merger or acquisition.

        "Additional Interest" has the meaning set forth in the Registration Rights Agreement.

        "Advisory Agreement" means that certain Advisory Agreement, dated as of the Issue Date, between the Issuer and the Sponsor.

        "Affiliate" of any Person means any other Person which directly or indirectly controls or is controlled by, or is under direct or indirect common control with, the referent Person. For purposes of this definition, "control" of a Person shall mean the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise.

        "amend" means to amend, supplement, restate, amend and restate or otherwise modify including successively; and "amendment" shall have a correlative meaning.

        "Applicable Premium" means, with respect to a Note at any Redemption Date, the greater of: (i) 1.0% of the principal amount of such Note; and (ii) the excess, if any, of: (A) the present value at such Redemption Date of (1) the redemption price of such Note on February 15, 2015 (such redemption price being that described in the first paragraph under "Optional Redemption") plus (2) all required remaining scheduled interest payments due on such Note through February 15, 2015, computed using a discount rate equal to the Treasury Rate on such Redemption Date plus 50 basis points per annum, over (B) the principal amount of such Note.

        Calculation of the Applicable Premium will be made by the Issuer or on behalf of the Issuer by such Person as the Issuer shall designate; provided, however, that such calculation shall not be a duty or obligation of the Trustee.

        "asset" means any asset or property.

        "Asset Sale" means (1) any sale, conveyance, transfer, lease, assignment or other disposition by the Issuer or any Restricted Subsidiary to any Person (including by means of a Sale and Leaseback Transaction or a merger or consolidation) (collectively, for purposes of this definition, a "transfer"), in one transaction or a series of related transactions, of any assets of the Issuer or any of its Restricted Subsidiaries other than in the ordinary course of business, or (2) the issuance or sale of Equity Interests of any Restricted Subsidiary, whether in one transaction or a series of related transactions. For purposes of this definition, the term "Asset Sale" shall not include:

(1)

transfers of cash or Cash Equivalents;



(2)

transfers of assets (including Equity Interests) that are governed by, and made in accordance with, the covenant described under "—Certain Covenants—Limitations on Mergers, Consolidations, Etc." or any such transfer that constitutes a Change of Control pursuant to the Indenture;



(3)

Permitted Investments and Restricted Payments permitted under the covenant described under "—Certain Covenants—Limitations on Restricted Payments";



(4)

the creation of or realization on any Permitted Lien;

171

(5)

transfers of damaged, worn-out or obsolete equipment or assets or transfers of inventories or goods (or other assets) that, in the Issuer's reasonable judgment, are no longer used or useful in the business of the Issuer or its Restricted Subsidiaries;



(6)

any transfer or series of related transfers that, but for this clause, would be Asset Sales, if after giving effect to such transfers, the aggregate Fair Market Value of the assets transferred in such transaction or any such series of related transactions does not exceed $10.0 million;



(7)

any transfer of assets by the Issuer or a Restricted Subsidiary, or the issuance of securities by a Restricted Subsidiary, in either case, to the Issuer or another Restricted Subsidiary;



(8)

any foreclosures, condemnation or similar action with respect to any asset; and



(9)

any issuance or sale of Equity Interests in, or Indebtedness or other securities of, an Unrestricted Subsidiary.

        "Attributable Indebtedness", when used with respect to any Sale and Leaseback Transaction, means, as at the time of determination, the present value (discounted at a rate borne by the Notes, compounded on a semi-annual basis) of the total obligations of the lessee for net rental payments during the remaining term of the lease included in any such Sale and Leaseback Transaction.

        "Bankruptcy Law" means Title 11 of the United States Code, as amended, or any similar federal or state law for the relief of debtors.

        "Board of Directors" means, with respect to any Person, (i) in the case of any corporation, the board of directors of such Person, (ii) in the case of any limited liability company, the board of managers or the managing member of such Person, (iii) in the case of any partnership, the Board of Directors of the general partner of such Person and (iv) in any other case, the functional equivalent of the foregoing.

        "Business Day" means a day other than a Saturday, Sunday or other day on which banking institutions in New York are authorized or required by law to close.

        "Capital Stock" means:

(1)

in the case of a corporation, corporate stock;



(2)

in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock;



(3)

in the case of a partnership or limited liability company, partnership interests (whether general or limited) or membership interests; and



(4)

any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person,

        but excluding from all of the foregoing any debt securities convertible into Capital Stock, whether or not such debt securities include any right of participation with Capital Stock.

        "Capitalized Lease" means a lease required to be capitalized for financial reporting purposes in accordance with GAAP.

        "Capitalized Lease Obligations" of any Person means the obligations of such Person to pay rent or other amounts under a Capitalized Lease, and the amount of such obligation shall be the capitalized amount thereof determined in accordance with GAAP.

        "Cash Equivalents" means:

(1)

obligations with a maturity of 13 months or less from the date of determination issued or directly and fully guaranteed or insured by the United States of America or any agency or

172

instrumentality thereof (provided that the full faith and credit of the United States of America is pledged in support thereof);

(2)

demand and time deposits and certificates of deposit or acceptances with a maturity of not more than one year of any financial institution that is a member of the Federal Reserve System having combined capital and surplus and undivided profits of not less than $500.0 million and is assigned at least a "B" rating by Thomson Financial BankWatch;



(3)

commercial paper maturing no more than 13 months from the date of determination thereof issued by a corporation that is not the Issuer or an Affiliate of the Issuer, and is organized under the laws of any State of the United States of America or the District of Columbia and rated at least A-2 by S&P or at least P-2 by Moody's;



(4)

repurchase obligations with a term of not more than 90 days for underlying securities of the types described in clause (1) above entered into with any commercial bank meeting the specifications of clause (2) above;



(5)

investments in money market or other mutual funds at least 90% of whose assets comprise securities of the types described in clauses (1) through (4) above; and



(6)

in the case of Investments by any Restricted Subsidiary that is a Foreign Subsidiary, (x) such local currencies in those countries in which such Foreign Subsidiary transacts business from time to time in the ordinary course of business and (y) Investments of comparable tenor and credit quality to those described in the foregoing clauses (1) through (5) customarily utilized in countries in which such Foreign Subsidiary operates for short-term cash management purposes.

        "CFC" means a controlled foreign corporation within the meaning of the U.S. Internal Revenue Code.

        "Change of Control" means the occurrence of any of the following events:

(1)

any "person" or "group" (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act), other than one or more Permitted Holders, is or becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that for purposes of this clause that person or group shall be deemed to have "beneficial ownership" of all securities that any such person or group has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of Voting Stock representing 50% or more of the voting power of the total outstanding Voting Stock of the Issuer;



(2)

during any period of two consecutive years commencing after the Issue Date, individuals who at the beginning of such period constituted the Board of Directors (together with any new directors whose election to such Board of Directors or whose nomination for election by the stockholders of the Issuer was approved by a vote of the majority of the directors of the Issuer then still in office who were either directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the Board of Directors of the Issuer; or



(3)

(a) all or substantially all of the assets of the Issuer and the Restricted Subsidiaries are sold or otherwise transferred to any Person other than a Wholly-Owned Restricted Subsidiary or one or more Permitted Holders or (b) the Issuer consolidates or merges with or into another Person or any Person consolidates or merges with or into the Issuer, in either case under this clause (3), in one transaction or a series of related transactions in which immediately after the consummation thereof Persons beneficially owning (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, Voting Stock representing in the aggregate a majority

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of the total voting power of the Voting Stock of the Issuer immediately prior to such consummation, together with the Permitted Holders, do not beneficially own (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, Voting Stock representing a majority of the total voting power of the Voting Stock of the Issuer or the surviving or transferee Person.

        "Consolidated Amortization Expense" for any period means the amortization expense of the Issuer and the Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP.

        "Consolidated Cash Flow" for any period means, without duplication, the sum of the amounts for such period of

(1)

Consolidated Net Income, plus

(2)

in each case only to the extent (and in the same proportion) deducted in determining Consolidated Net Income,



(a)

Consolidated Income Tax Expense;



(b)

Consolidated Amortization Expense (but only to the extent not included in Consolidated Interest Expense);



(c)

Consolidated Depreciation Expense;



(d)

Consolidated Interest Expense;



(e)

Restructuring Expenses;



(f)

to the extent permitted to be made pursuant to clause (9) of the second paragraph under "—Certain Covenants—Limitations on Transactions with Affiliates," any management, consulting, monitoring, advisory or termination fees and expenses or any transaction fees and expenses paid or accrued for payment to Sponsor or any of its Affiliates;



(g)

any fees, expenses, costs or charges or any amortization thereof, related to any Subject Transaction (in each case including any such transaction undertaken but not completed) and any amendment or modification of any such Subject Transaction;



(h)

the amount of any minority interest expense consisting of income of a Subsidiary Guarantor attributable to minority Equity Interests of third parties in any Subsidiary Guarantor that is not a Wholly-Owned Restricted Subsidiary;



(i)

expenses, costs or charges or any amortization thereof that results from accruals and reserves (other than fees, expenses, costs or charges relating to the Transactions) that are established within twelve months after the Issue Date that are so required to be established as a result of the Transactions in accordance with GAAP;



(j)

cash receipts (or any netting arrangements resulting in reduced cash expenditures) not representing Consolidated Net Income in any period to the extent non-cash gains relating to such income were deducted in the calculation of Consolidated Cash Flow pursuant to clause (3) below for any previous period and not added back;



(k)

the amount of net cost savings projected by the Issuer in good faith to be realized as a result of specified actions taken or initiated in connection with a Subject Transaction during or prior to such period (calculated on a pro forma basis as though such cost savings had been realized on the first day of such period), net of the amount of actual benefits realized during such period from such actions; provided that (x) such cost savings are reasonably identifiable and factually supportable, (y) no such cost savings may be

174

realized more than 12 months following the Subject Transaction and (z) the aggregate amount of cost savings added pursuant to this clause (k) shall not exceed, for any Four-Quarter Period, 15% of Consolidated Cash Flow for such period before giving effect to this clause (k), with such pro forma adjustments to Consolidated Cash Flow as are appropriate and consistent with the pro forma adjustment provision set forth in the definition of "Consolidated Interest Coverage Ratio"; and

(l)

all other non-cash items reducing the Consolidated Net Income (excluding (x) any non-cash charge that results in an accrual of a reserve for cash charges in any future period and (y) any write-offs or write-downs of inventory or accounts receivable (other than any write-off or write-down of inventory or accounts receivable in connection with an acquisition that includes the acquisition of such inventory or accounts receivable) for such period,



(2)

in each case determined on a consolidated basis in accordance with GAAP, reduced (without duplication) by the following, in each case to the extent included in determining Consolidated Net Income for such period:



(3)

(a) the aggregate amount of all non-cash items (excluding any item which represents the reversal of any accrual of, or cash reserve for, anticipated cash charges in any period), determined on a consolidated basis, to the extent such items increased Consolidated Net Income for such period; and



(b)

the amount of any minority interest income consisting of Subsidiary Guarantor losses attributable to minority Equity Interests of third parties in any Subsidiary Guarantor that is not a Wholly-Owned Restricted Subsidiary.

        "Consolidated Depreciation Expense" for any period means the depreciation expense of the Issuer and the Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP.

        "Consolidated Income Tax Expense" for any period means the provision for taxes of the Issuer and the Restricted Subsidiaries, determined on a consolidated basis in accordance with GAAP.

        "Consolidated Interest Coverage Ratio" means the ratio of Consolidated Cash Flow during the most recent four consecutive full fiscal quarters for which financial statements are available (the "Four-Quarter Period") ending on or prior to the date of the transaction giving rise to the need to calculate the Consolidated Interest Coverage Ratio (the "Transaction Date") to Consolidated Interest Expense for the Four-Quarter Period. For purposes of this definition, Consolidated Cash Flow and Consolidated Interest Expense shall be calculated after giving effect on a pro forma basis for the period of such calculation to:

(1)

the incurrence of any Indebtedness or the issuance of any Preferred Stock of the Issuer or any Restricted Subsidiary (and the application of the proceeds thereof) and any repayment of other Indebtedness or redemption of other Preferred Stock (and the application of the proceeds therefrom) (other than the incurrence or repayment of Indebtedness in the ordinary course of business for working capital purposes pursuant to any revolving credit arrangement) occurring during the Four-Quarter Period or at any time subsequent to the last day of the Four-Quarter Period and on or prior to the Transaction Date, as if such incurrence, repayment, issuance or redemption, as the case may be (and the application of the proceeds thereof), occurred on the first day of the Four-Quarter Period; and



(2)

any Investment, acquisition, disposition, merger, consolidation or disposed operation (as determined in accordance with GAAP) (including, without limitation, any acquisition giving rise to the need to make such calculation as a result of the Issuer or any Restricted Subsidiary (including any Person who becomes a Restricted Subsidiary as a result of such acquisition)

175

incurring Acquired Indebtedness and also including any Consolidated Cash Flow (including any pro forma expense and cost reductions calculated on a basis consistent with Regulation S-X under the Exchange Act) associated with any such acquisition) occurring during the Four-Quarter Period or at any time subsequent to the last day of the Four-Quarter Period and on or prior to the Transaction Date, as if such Investment, acquisition, disposition, merger, consolidation or disposed operation (including the incurrence of, or assumption or liability for, any such Acquired Indebtedness) occurred on the first day of the Four-Quarter Period. If since the beginning of such Four-Quarter Period any Person that subsequently became a Restricted Subsidiary or was merged with or into the Issuer or any of its Restricted Subsidiaries since the beginning of such period shall have made any Investment, acquisition, disposition, merger, consolidation or disposed operation that would have required adjustment pursuant to this definition, then the Consolidated Interest Coverage Ratio shall be calculated giving pro forma effect thereto for such period as if such Investment, acquisition, disposition, merger, consolidation or disposed operation had occurred at the beginning of the applicable Four-Quarter Period.

        If the Issuer or any Restricted Subsidiary directly or indirectly guarantees Indebtedness of a third Person, the preceding sentence shall give effect to the incurrence of such guaranteed Indebtedness as if the Issuer or such Restricted Subsidiary had directly incurred or otherwise assumed such guaranteed Indebtedness.

        For purposes of calculating the Consolidated Interest Coverage Ratio prior to the expiration of the first Four-Quarter Period subsequent to the Issue Date, such calculation shall be on the same pro forma basis as the pro forma financial statements that are presented in this Prospectus.

        In calculating Consolidated Interest Expense for purposes of determining the denominator (but not the numerator) of this Consolidated Interest Coverage Ratio:

(1)

interest on outstanding Indebtedness determined on a fluctuating basis as of the Transaction Date and which will continue to be so determined thereafter shall be deemed to have accrued at a fixed rate per annum equal to the rate of interest on this Indebtedness in effect on the Transaction Date;



(2)

if interest on any Indebtedness actually incurred on the Transaction Date may optionally be determined at an interest rate based upon a factor of a prime or similar rate, a eurocurrency interbank offered rate, or other rates, then the interest rate in effect on the Transaction Date will be deemed to have been in effect during the Four-Quarter Period; and



(3)

notwithstanding clause (1) or (2) above, interest on Indebtedness determined on a fluctuating basis, to the extent such interest is covered by agreements relating to Hedging Obligations, shall be deemed to accrue at the rate per annum resulting after giving effect to the operation of these agreements.

        "Consolidated Interest Expense" for any period means the sum, without duplication, of the total interest expense minus the interest income of the Issuer and the Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP and including without duplication,

(1)

imputed interest on Capitalized Lease Obligations and Attributable Indebtedness,



(2)

commissions, discounts and other fees and charges owed to Persons other than the Issuer or any Restricted Subsidiary with respect to letters of credit securing financial obligations, bankers' acceptance financing and receivables financings,



(3)

the net costs associated with Hedging Obligations,

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(4)

amortization of debt issuance costs and original issue discount resulting from the issuance of Indebtedness at less than par,



(5)

the interest portion of any deferred payment obligations,



(6)

all other non-cash interest expense (but excluding any non-cash interest expense attributable to the movement in the mark to market valuation of Hedging Obligations or other derivative instruments pursuant to GAAP),



(7)

capitalized interest, and



(8)

all cash dividend payments on any series of Disqualified Equity Interests of the Issuer or any Preferred Stock of any Restricted Subsidiary (other than any such Disqualified Equity Interests or any Preferred Stock held by the Issuer or a Wholly-Owned Restricted Subsidiary or to the extent paid in Qualified Equity Interests).

        Notwithstanding the preceding, all such amounts relating to the 8% Senior Subordinated Notes and the Floating Rate Notes to be purchased or redeemed in connection with the Transactions and the amortization of debt issuance costs, debt discount or premium and other financing fees and expenses incurred in connection with the Transactions shall be excluded in the calculation of Consolidated Interest Expense to the extent otherwise included therein.

        Consolidated Interest Expense shall be calculated after giving effect to Hedging Obligations (including associated costs) but excluding unrealized gains and losses with respect to Hedging Obligations.

        "Consolidated Net Income" for any period means the net income (or loss) of the Issuer and the Restricted Subsidiaries for such period determined on a consolidated basis in accordance with GAAP; provided that there shall be excluded from such net income (to the extent otherwise included therein), without duplication:

(1)

the net income (or loss) of any Person (other than a Restricted Subsidiary) in which any Person other than the Issuer and the Restricted Subsidiaries has an ownership interest, except to the extent that cash in an amount equal to any such income has actually been received by the Issuer or (subject to clause (3) below) any of its Restricted Subsidiaries during such period;



(2)

solely for purposes of calculating the Restricted Payments Basket, except to the extent includible in the consolidated net income of the Issuer pursuant to the foregoing clause (1), the net income (or loss) of any Person that accrued prior to the date that (a) such Person becomes a Restricted Subsidiary or is merged into or consolidated with the Issuer or any Restricted Subsidiary or (b) the assets of such Person are acquired by the Issuer or any Restricted Subsidiary;



(3)

solely for purposes of calculating the Restricted Payments Basket, the net income of any Restricted Subsidiary during such period to the extent that the declaration or payment of dividends or similar distributions by such Restricted Subsidiary of that income is not permitted by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation applicable to that Subsidiary during such period, except that the Consolidated Net Income of the Issuer will be increased by the amount of dividends or other distributions or other payments actually paid in cash (or to the extent converted into cash) to the Issuer or a Restricted Subsidiary by such Restricted Subsidiary, to the extent not already included therein;



(4)

other than for purposes of calculating the Restricted Payments Basket, any gain (or loss), together with any related provisions for taxes on any such gain (or the tax effect of any such

177

loss), realized during such period by the Issuer or any Restricted Subsidiary upon (a) the acquisition of any securities, or the extinguishment of any Indebtedness, of the Issuer or any Restricted Subsidiary or (b) any Asset Sale or other asset disposition or abandonment (other than in the ordinary course of business) and reserves relating thereto by the Issuer or any Restricted Subsidiary;

(5)

purchase accounting adjustments attributable to any acquisition, including the Transactions, including write-offs of acquired in-process research and development, amortization of inventory write-ups and amortization of acquisition-related intangibles, net of taxes;



(6)

gains and losses due solely to fluctuations in currency values and the related tax effects according to GAAP;



(7)

net unrealized gains and losses with respect to Hedging Obligations;



(8)

the cumulative effect of a change in accounting principles under GAAP;



(9)

any payments made in connection with the consummation of the Transactions as described in this Prospectus;



(10)

any extraordinary gain or loss and, other than for purposes of calculating the Restricted Payments Basket, any nonrecurring or unusual gains, losses, expenses or charges, together, as applicable, with any related provision for taxes on any such extraordinary or nonrecurring or unusual gain (or the tax effect of any such extraordinary or nonrecurring or unusual losses, expenses or charges), realized by the Issuer or any Restricted Subsidiary during such period;



(11)

any gains (or losses) resulting from the return of surplus assets of any benefit plan; and



(12)

any net after-tax gains or losses from discontinued operations or the disposal of disposed, abandoned or discontinued operations.

        In addition:

(a)

Consolidated Net Income shall be reduced by (without duplication) the amount of any payments to or on behalf of Parent made pursuant to clause (4) of the last paragraph of the covenant described under "—Certain Covenants—Limitations on Transactions with Affiliates"; and



(b)

any return of capital with respect to an Investment that increased the Restricted Payments Basket pursuant to clause (3)(d) of the first paragraph under "—Certain Covenants—Limitations on Restricted Payments" or decreased the amount of Investments outstanding pursuant to the last sentence of the definition of "Investments" shall be excluded from Consolidated Net Income for purposes of calculating the Restricted Payments Basket.

        "Consolidated Secured Debt Ratio" means, as of the date of determination, the ratio of (1) the aggregate principal amount of Indebtedness of the Issuer and the Restricted Subsidiaries of the type described in (a) clause (1), (2) (6) or (9) of the definition of "Indebtedness," or (b) clause (7) or (8) of the definition of "Indebtedness" (to the extent the Indebtedness secured or guaranteed is of the type described in the preceding clause (a)), in each case, that is secured by any Lien as of the end of the most recent fiscal quarter for which financial statements are available ending on or prior to the date of the transaction giving rise to the need to calculate the Consolidated Secured Debt Ratio to (2) the Issuer's Consolidated Cash Flow for the Four-Quarter Period ending on or prior to the date of the transaction giving rise to the need to calculate the Consolidated Secured Debt Ratio, in each case, with such pro forma adjustments to such Indebtedness and Consolidated Cash Flow as are appropriate and consistent with the pro forma adjustment provision set forth in the definition of "Consolidated Interest Coverage Ratio."

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        "Coverage Ratio Exception" has the meaning set forth in the proviso in the first paragraph of the covenant described under "—Certain Covenants—Limitations on Additional Indebtedness."

        "Credit Agreement" means the Credit Agreement dated on or about the Issue Date by and among the Issuer, as Borrower, UBS AG, Stamford Branch, as administrative agent and collateral agent and the lenders party thereto, including any notes, guarantees, collateral and security documents, instruments and agreements executed in connection therewith (including Hedging Obligations related to the Indebtedness incurred thereunder), and in each case as amended, modified, supplemented or refinanced from time to time.

        "Credit Facilities" means one or more debt facilities or other financing arrangements (which may be outstanding at the same time and including, without limitation, the Credit Agreement) providing for revolving credit loans, term loans, letters of credit or other long-term indebtedness, including any notes, mortgages, guarantees, collateral documents, instruments and agreements executed in connection therewith, and, in each case, as such agreements may be amended, amended and restated, supplemented, modified, refinanced, replaced or otherwise restructured, in whole or in part from time to time (including increasing the amount of available borrowings thereunder or adding Subsidiaries of the Issuer as additional borrowers or guarantors thereunder) with respect to all or any portion of the Indebtedness under such agreement or agreements or any successor or replacement agreement or agreements and whether or not with the same or any other agent, lender or group of lenders and whether or not provided under the Credit Agreement or any other credit or other agreement or indenture.

        "Custodian" means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law.

        "Default" means (1) any Event of Default or (2) any event, act or condition that, after notice or the passage of time or both, would be an Event of Default.

        "Designation" has the meaning given to this term in the covenant described under "—Certain Covenants—Limitations on Designation of Unrestricted Subsidiaries."

        "Designation Amount" has the meaning given to this term in the covenant described under "—Certain Covenants—Limitations on Designation of Unrestricted Subsidiaries."

        "Disqualified Equity Interests" of any Person means any class of Equity Interests of such Person that, by its terms, or by the terms of any related agreement or of any security into which it is convertible, puttable or exchangeable, is, or upon the happening of any event or the passage of time would be, required to be redeemed by such Person, whether or not at the option of the holder thereof, or matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, in whole or in part, on or prior to the date which is 91 days after the final maturity date of the Notes; provided, however, that any class of Equity Interests of such Person that, by its terms, authorizes such Person to satisfy in full its obligations with respect to the payment of dividends or upon maturity, redemption (pursuant to a sinking fund or otherwise) or repurchase thereof or otherwise by the delivery of Equity Interests that are not Disqualified Equity Interests, and that is not convertible, puttable or exchangeable for Disqualified Equity Interests or Indebtedness, will not be deemed to be Disqualified Equity Interests so long as such Person satisfies its obligations with respect thereto solely by the delivery of Equity Interests that are not Disqualified Equity Interests; provided, further, however, that any Equity Interests that would not constitute Disqualified Equity Interests but for provisions thereof giving holders thereof (or the holders of any security into or for which such Equity Interests are convertible, exchangeable or exercisable) the right to require the Issuer to redeem such Equity Interests upon the occurrence of a change of control or an asset disposition occurring prior to the final maturity date of the Notes shall not constitute Disqualified Equity Interests if the change of control or asset disposition provisions applicable to such Equity Interests are no more favorable to such holders than

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the provisions described under "—Change of Control" and "—Certain Covenants—Limitations on Asset Sales."

        "Domestic Subsidiary" means any Subsidiary other than a Foreign Subsidiary.

        "Equity Interests" of any Person means (1) Capital Stock and (2) all rights to purchase, warrants or options (whether or not currently exercisable) to acquire Capital Stock (but excluding any debt security that is convertible into or exchangeable for Capital Stock).

        "Exchange Act" means the U.S. Securities Exchange Act of 1934, as amended.

        "Excluded Subsidiary" means (i) any Foreign Subsidiary, (ii) any Domestic Subsidiary that is a Subsidiary of a CFC, (iii) any Domestic Subsidiary that is a disregarded entity under the U.S. Internal Revenue Code and has no material assets other than the Equity Interests of one or more CFCs, (iv) any Immaterial Subsidiary and (v) any Unrestricted Subsidiary.

        "Fair Market Value" means, with respect to any asset, the price (after taking into account any liabilities relating to such assets) that would be negotiated in an arm's-length transaction between a willing seller and a willing and able buyer, neither of which is under any compulsion to complete the transaction, as such price is determined in good faith by an Officer, or, with respect to valuations in excess of $10.0 million, by the Board of Directors of the Issuer or a duly authorized committee thereof, as evidenced by a resolution of such Board or committee.

        "Floating Rate Notes" means CPI International, Inc.'s Floating Rate Senior Notes due 2015 outstanding on the date of this Prospectus.

        "Foreign Subsidiary" means any Restricted Subsidiary of the Issuer which is not organized under the laws of (x) the United States or any State thereof or (y) the District of Columbia.

        "GAAP" means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as may be approved by a significant segment of the accounting profession of the United States, as in effect on the Issue Date. At any time after the Issuer Date, the Issuer may elect to apply IFRS accounting principles in lieu of GAAP and, upon any such election, references herein to GAAP shall thereafter be construed to mean IFRS; provided that calculations or determinations in the Indenture that require the application of GAAP for periods that include fiscal quarters ended prior to the Issuer's election to apply IFRS shall remain as previously calculated or determined in accordance with GAAP. The Issuer shall give notice of any such election made in accordance with this definition to the Trustee and the Holders.

        "guarantee" means a direct or indirect guarantee by any Person of any Indebtedness of any other Person and includes any obligation, direct or indirect, contingent or otherwise, of such Person: (1) to purchase or pay (or advance or supply funds for the purchase or payment of) Indebtedness of such other Person (whether arising by virtue of partnership arrangements, or by agreements to keep-well, to purchase assets, goods, securities or services (unless such purchase arrangements are on arm's-length terms and are entered into in the ordinary course of business), to take-or-pay, or to maintain financial statement conditions or otherwise); or (2) entered into for purposes of assuring in any other manner the obligee of such Indebtedness of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part); "guarantee," when used as a verb, and "guaranteed" have correlative meanings.

        "Guarantors" means Parent and each Restricted Subsidiary of the Issuer on the Issue Date (other than any Excluded Subsidiary), and each other Person that is required to, or at the election of the Issuer does, become a Guarantor by the terms of the Indenture after the Issue Date, in each case, until such Person is released from its Note Guarantee in accordance with the terms of the Indenture.

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        "Hedging Obligations" of any Person means the obligations of such Person under swap, cap, collar, forward purchase or similar agreements or arrangements dealing with interest rates, currency exchange rates or commodity prices, either generally or under specific contingencies.

        "Holder" means any registered holder, from time to time, of the Notes.

        "IFRS" means international financial reporting standards and interpretations issued by the International Accounting Standards Board and adopted by the European Commission, as in effect from time to time.

        "Immaterial Subsidiary" shall mean any Restricted Subsidiary of Parent (other than Issuer), which, together with its own Restricted Subsidiaries, as consolidated in the consolidated financial statements of Parent, accounts for (i) less than 1.0% of the consolidated assets of Parent as of the last day of the most recently ended fiscal quarter of Parent for which financial information is available and (ii) less than 1.0% of Consolidated Cash Flow for the most recently ended period of four consecutive fiscal quarters of Parent; provided that (x) all Immaterial Subsidiaries shall not, in the aggregate, account for more than 3.0% of the consolidated assets of Parent as of such most recently ended fiscal quarter or for more than 3.0% of the Consolidated Cash Flow of Parent for such most recently ended period of four consecutive fiscal quarters and (y) no Subsidiary that is an obligor under the Credit Agreement shall be an Immaterial Subsidiary.

        "incur" means, with respect to any Indebtedness or Obligation, incur, create, issue, assume, guarantee or otherwise become directly or, indirectly liable, contingently or otherwise, with respect to such Indebtedness or Obligation; provided that (1) the Indebtedness of a Person existing at the time such Person became a Restricted Subsidiary shall be deemed to have been incurred by such Restricted Subsidiary at such time and (2) none of the accrual of interest or dividends nor the accretion of accreted value, the accretion or amortization of original issue discount or the payment of interest or dividends in the form of additional Indebtedness or Disqualified Equity Interests of the same class shall be deemed to be an incurrence of Indebtedness.

        "Indebtedness" of any Person at any date means, without duplication:

(1)

all indebtedness of such Person for borrowed money (whether or not the recourse of the lender is to the whole of the assets of such Person or only to a portion thereof);



(2)

all indebtedness of such Person evidenced by bonds, debentures, notes or other similar instruments;



(3)

all reimbursement obligations of such Person in respect of letters of credit, letters of guaranty, bankers' acceptances, bank guarantees and similar credit transactions;



(4)

all obligations of such Person to pay the deferred and unpaid purchase price of property or services, except trade payables and accrued expenses incurred by such Person in the ordinary course of business in connection with obtaining goods, materials or services;



(5)

the maximum fixed redemption or repurchase price of all Disqualified Equity Interests of such Person;



(6)

all Capitalized Lease Obligations of such Person;



(7)

all Indebtedness of others secured by a Lien on any asset of such Person, whether or not such Indebtedness is assumed by such Person;



(8)

all Indebtedness of others guaranteed by such Person to the extent of such guarantee; provided that Indebtedness of the Issuer or its Subsidiaries that is guaranteed by the Issuer or the Issuer's Subsidiaries shall only be counted once in the calculation of the amount of Indebtedness of the Issuer and its Subsidiaries on a consolidated basis;

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(9)

all Attributable Indebtedness;



(10)

to the extent not otherwise included in this definition, net obligations of such Person under Hedging Obligations of such Person (the amounts of any such obligations to be equal at any time to the termination value of such Hedging Obligation that would be payable by, or to, such Person at such time); and



(11)

all obligations of such Person under conditional sale or other title retention agreements relating to assets purchased by such Person;

provided, that the foregoing clauses (3) (other than reimbursement obligations for letters of credit), (4), (6) and (11) shall only constitute Indebtedness if and to the extent such items would appear as a liability upon a balance sheet (excluding the footnotes thereto) of such Person prepared in accordance with GAAP; provided further, that Indebtedness shall not include any lease previously classified as an operating lease under GAAP that is reclassified as a Capitalized Lease as a result of a change in GAAP occurring after the Issue Date or any lease that but for any such change to GAAP would have been classified as an operating lease under GAAP.

        The amount of any Indebtedness which is incurred at a discount to the principal amount at maturity thereof as of any date shall be deemed to have been incurred at the accreted value thereof as of such date. The amount of Indebtedness of any Person at any date shall be the outstanding balance at such date of all unconditional obligations as described above, the maximum liability of such Person for any such contingent obligations at such date and, in the case of clause (7), the lesser of (a) the Fair Market Value of any asset subject to a Lien securing the Indebtedness of others on the date that the Lien attaches and (b) the amount of the Indebtedness secured. For purposes of clause (5), the "maximum fixed redemption or repurchase price" of any Disqualified Equity Interests that do not have a fixed redemption or repurchase price shall be calculated in accordance with the terms of such Disqualified Equity Interests as if such Disqualified Equity Interests were redeemed or repurchased on any date on which an amount of Indebtedness outstanding shall be required to be determined pursuant to the Indenture.

        "Independent Financial Advisor" means an accounting, appraisal or investment banking firm of nationally recognized standing that is, in the reasonable judgment of the Issuer's Board of Directors, qualified to perform the task for which it has been engaged and is not an Affiliate of the Issuer and is otherwise disinterested with respect to the applicable transaction.

        "interest" means, with respect to the Notes, interest and Additional Interest, if any, on the Notes.

        "Investments" of any Person means:

(1)

all direct or indirect investments by such Person in any other Person in the form of loans, advances or capital contributions or other credit extensions constituting Indebtedness of such other Person (excluding accounts receivable, trade credit, advances to customers, commission, travel and similar advances to officers and employees, in each case made in the ordinary course of business), and any guarantee of Indebtedness of any other Person;



(2)

all purchases (or other acquisitions for consideration) by such Person of Indebtedness, Equity Interests or other securities of any other Person (other than any such purchase that constitutes a Restricted Payment of the type described in clause (2) of the definition thereof);



(3)

all other items that would be classified as investments on a balance sheet of such Person prepared in accordance with GAAP in the same manner as the other investments included in this definition to the extent such transactions involve the transfer of cash or other property; and



(4)

the Designation of any Subsidiary as an Unrestricted Subsidiary.

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        Except as otherwise expressly specified in this definition, the amount of any Investment (other than an Investment made in cash) shall be the Fair Market Value thereof on the date such Investment is made. The amount of Investment pursuant to clause (4) shall be the Designation Amount determined in accordance with the covenant described under "—Certain Covenants—Limitations on Designation of Unrestricted Subsidiaries." If the Issuer or any Restricted Subsidiary sells or otherwise disposes of any Equity Interests of any direct or indirect Restricted Subsidiary such that, after giving effect to any such sale or disposition, such Person is no longer a Restricted Subsidiary, the Issuer shall be deemed to have made an Investment on the date of any such sale or other disposition equal to the Fair Market Value of the Investments in such Restricted Subsidiary not sold or disposed of, which amount shall be determined by the Board of Directors. The acquisition by the Issuer or any Restricted Subsidiary of a Person that holds an Investment in a third Person shall be deemed to be an Investment by the Issuer or such Restricted Subsidiary in the third Person in an amount equal to the Fair Market Value of the Investment held by the acquired Person in the third Person.

        The amount of any Investment outstanding at any time shall be deemed to be reduced:

(a)

upon the disposition or repayment of or return on such Investment, by an amount equal to the return of capital or principal with respect to such Investment to the Issuer or any Restricted Subsidiary (to the extent not included in the computation of Consolidated Net Income or the Restricted Payments Basket), less the cost of the disposition of such Investment and net of taxes; and



(b)

upon a Redesignation of an Unrestricted Subsidiary as a Restricted Subsidiary, by an amount equal to the lesser of (x) the Fair Market Value of the Issuer's proportionate interest in such Subsidiary immediately following such Redesignation, and (y) the aggregate amount of Investments in such Subsidiary that increased (and did not previously decrease) the amount of Investments outstanding; provided that the amount reducing the amount of Investments outstanding shall not also increase the Restricted Payments Basket pursuant to clause (3)(d) or (e) of the first paragraph under "—Certain Covenants—Limitation on Restricted Payments."

        "Investment Grade Rating" means a rating equal to or higher than Baa3 (or the equivalent) by Moody's and BBB- (or the equivalent) by S&P, or an equivalent rating by any other Rating Agency.

        "Issue Date" means February 11, 2011.

        "Lien" means, with respect to any asset, any mortgage, deed of trust, lien (statutory or other), pledge, lease, charge, security interest or other encumbrance of any kind or nature in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law, including any conditional sale or other title retention agreement, and any lease in the nature thereof, and any filing of, or agreement to give, any financing statement under the Uniform Commercial Code (or equivalent statutes) of any jurisdiction (other than cautionary filings in respect of operating leases); provided, that in no event shall an operating lease constitute a Lien.

        "Merger" means the merger of Catalyst Acquisition, Inc. with and into CPI International, Inc. with CPI International, Inc. as the surviving entity.

        "Moody's" means Moody's Investors Service, Inc., and its successors.

        "Net Available Proceeds" means, with respect to any Asset Sale, the proceeds thereof in the form of cash or Cash Equivalents, net of:

(1)

the direct costs relating to such Asset Sale, including brokerage commissions and other fees and expenses (including fees and expenses of legal counsel, accountants and investment banks) of such Asset Sale;

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(2)

relocation and demolition expenses incurred in connection with, or as a result of, such Asset Sale;



(3)

taxes paid and provisions for taxes payable as a result of such Asset Sale (after taking into account any available tax credits or deductions and any tax sharing arrangements);



(4)

amounts required to be paid to any Person (other than the Issuer or any Restricted Subsidiary) owning a beneficial interest in the assets subject to the Asset Sale or having a Lien thereon;



(5)

payments of unassumed liabilities (not constituting Indebtedness) relating to the assets sold at the time of, or within 90 days after the date of, such Asset Sale; and



(6)

appropriate amounts to be provided by the Issuer or any Restricted Subsidiary, as the case may be, as a reserve required in accordance with GAAP against any adjustment in the sale price of such asset or assets or liabilities associated with such Asset Sale and retained by the Issuer or any Restricted Subsidiary, as the case may be, after such Asset Sale, including pensions and other post-employment benefit liabilities, liabilities related to environmental matters and liabilities under any indemnification obligations associated with such Asset Sale; provided, however, that any amounts remaining after adjustments, revaluations or liquidations of such reserves shall constitute Net Available Proceeds at such time.

        "Non-Recourse Debt" means Indebtedness of an Unrestricted Subsidiary:

(1)

as to which neither the Issuer nor any Restricted Subsidiary (a) provides credit support of any kind (including any undertaking, agreement or instrument that would constitute Indebtedness), or (b) is directly or indirectly liable as a guarantor or otherwise; and



(2)

no default with respect to which (including any rights that the holders thereof may have to take enforcement action against an Unrestricted Subsidiary) would permit upon notice, lapse of time or both any holder of any other Indebtedness (other than the Credit Agreement or the Notes) of the Issuer or any Restricted Subsidiary to declare a default on the other Indebtedness or cause the payment thereof to be accelerated or payable prior to its stated maturity.

        "Obligation" means any principal, interest, penalties, fees, indemnification, reimbursements, costs, expenses, damages and other liabilities payable under the documentation governing any Indebtedness.

        "Prospectus" means this prospectus.

        "Officer" means any of the following of the Issuer: the Chairman of the Board of Directors, the Chief Executive Officer, the Chief Financial Officer, the President, any Vice President, the Treasurer or the Secretary.

        "Officers' Certificate" means a certificate signed by two Officers.

        "Parent" means CPI International Holding Corp., a Delaware corporation, and its successors and assigns.

        "Pari Passu Indebtedness" means any Indebtedness of the Issuer or any Guarantor that ranks pari passu in right of payment with the Notes or the Note Guarantees, as applicable.

        "Permitted Business" means the businesses engaged in by the Issuer and its Subsidiaries on the Issue Date as described in this Prospectus and businesses that are reasonably related thereto or reasonable extensions thereof or similar, incidental, ancillary or complementary thereto, including the business of power amplification and satellite communications.

        "Permitted Holders" means Sponsor and members of management of the Issuer or its Restricted Subsidiaries on the Issue Date who are holders of Equity Interests of the Issuer or Parent and any group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act or any

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successor provision) of which any of the foregoing are members; provided that, in the case of such group and without giving effect to the existence of such group or any other group, Sponsor and such members of management, collectively, beneficially own Voting Stock representing more than 50% of the total voting power of the Voting Stock of the Issuer.

        "Permitted Investments" means:

(1)

Investments by the Issuer or any Restricted Subsidiary in (a) any Restricted Subsidiary or (b) in any Person that will become immediately after such Investment a Restricted Subsidiary or that will merge or consolidate into the Issuer or a Restricted Subsidiary;



(2)

Investments in the Issuer by any Restricted Subsidiary;



(3)

loans and advances to or guarantees of Indebtedness of directors, employees and officers of the Issuer and the Restricted Subsidiaries not in excess of $4.0 million at any one time outstanding, and loans and advances to officers, directors and employees for business-related travel expenses, moving expenses and other similar expenses, in each case incurred in the ordinary course of business;



(4)

Hedging Obligations incurred pursuant to clause (4) of the second paragraph under the covenant described under "—Certain Covenants—Limitations on Additional Indebtedness";



(5)

cash and Cash Equivalents;



(6)

receivables owing to the Issuer or any Restricted Subsidiary if created or acquired in the ordinary course of business and payable or dischargeable in accordance with customary trade terms; provided, however, that such trade terms may include such concessionary trade terms as the Issuer or any such Restricted Subsidiary deems reasonable under the circumstances;



(7)

Investments in securities of trade creditors or customers received pursuant to any plan of reorganization or similar arrangement upon the bankruptcy or insolvency of such trade creditors or customers;



(8)

Investments made by the Issuer or any Restricted Subsidiary as a result of consideration received in connection with an Asset Sale made in compliance with the covenant described under "—Certain Covenants—Limitations on Asset Sales";



(9)

lease, utility and other similar deposits in the ordinary course of business;



(10)

Investments made by the Issuer or a Restricted Subsidiary for consideration consisting only of Qualified Equity Interests of the Issuer;



(11)

stock, obligations or securities received in settlement of debts created in the ordinary course of business and owing to the Issuer or any Restricted Subsidiary or in satisfaction of judgments; and



(12)

any Investment existing on the Issue Date and any Investment consisting of an extension, modification or renewal of any Investment existing on the Issue Date; provided that the amount of any such Investment may only be increased (a) as required by the terms of such Investment as in existence on the Issue Date or (b) to the extent permitted by another clause in this definition of "Permitted Investments" or by the covenant described under "—Certain Covenants—Limitations on Restricted Payments";



(13)

Investments acquired after the Issue Date as a result of the acquisition by the Issuer or any Restricted Subsidiary of the Issuer of another Person (including as contemplated by clause (1) above), including by way of a merger, amalgamation or consolidation with or into the Company or any of its Restricted Subsidiaries in a transaction that is not prohibited by the covenant described above under the caption "—Certain Covenants—Limitations on Mergers,

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Consolidations, Etc." after the Issue Date, to the extent that such Investments were not made in contemplation of such acquisition;

(14)

guarantees of Indebtedness of the Issuer or any Restricted Subsidiary to the extent such Indebtedness is permitted to be incurred under the Indenture; and



(15)

other Investments in an aggregate amount not to exceed $25.0 million at any one time outstanding (with each Investment being valued as of the date made and without regard to subsequent changes in value).

        "Permitted Liens" means the following types of Liens:

(1)

Liens for taxes, assessments or governmental charges or claims either (a) not delinquent for more than 30 days or (b) contested in good faith by appropriate proceedings and as to which the Issuer or the Restricted Subsidiaries shall have set aside on its books such reserves as may be required pursuant to GAAP;



(2)

statutory Liens of landlords and Liens of carriers, warehousemen, mechanics, suppliers, materialmen, repairmen and other Liens imposed by law incurred in the ordinary course of business for sums not yet delinquent for more than 30 days or being contested in good faith, if such reserve or other appropriate provision, if any, as shall be required by GAAP shall have been made in respect thereof;



(3)

Liens incurred or deposits made in the ordinary course of business in connection with workers' compensation, unemployment insurance and other types of social security, or to secure the performance of tenders, statutory obligations, surety and appeal bonds, bids, leases, government contracts, performance and return-of-money bonds and other similar obligations (exclusive of obligations for the payment of borrowed money);



(4)

Liens upon specific items of inventory or other goods and proceeds of any Person securing such Person's obligations in respect of bankers' acceptances issued or created for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods;



(5)

judgment Liens not giving rise to a Default so long as such Liens are adequately bonded and any appropriate legal proceedings which may have been duly initiated for the review of such judgment have not been finally terminated or the period within which the proceedings may be initiated has not expired;



(6)

easements, rights-of-way, zoning restrictions and other similar charges, restrictions or encumbrances in respect of real property or immaterial imperfections of title which do not, in the aggregate, impair in any material respect the ordinary conduct of the business of the Issuer and the Restricted Subsidiaries taken as a whole;



(7)

Liens securing reimbursement obligations with respect to commercial letters of credit which encumber documents and other assets relating to such letters of credit and products and proceeds thereof;



(8)

Liens encumbering deposits made to secure obligations arising from statutory, regulatory, contractual or warranty requirements of the Issuer or any Restricted Subsidiary, including rights of offset and setoff;



(9)

bankers' Liens, rights of setoff and other similar Liens existing solely with respect to cash and Cash Equivalents on deposit in one or more of accounts maintained by the Issuer or any Restricted Subsidiary, in each case granted in the ordinary course of business in favor of the bank or banks with which such accounts are maintained, securing amounts owing to such bank with respect to cash management and operating account arrangements, including those

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involving pooled accounts and netting arrangements; provided that in no case shall any such Liens secure (either directly or indirectly) the repayment of any Indebtedness;

(10)

leases, subleases, licenses or sublicenses granted to others that do not materially interfere with the ordinary course of business of the Issuer or any Restricted Subsidiary;



(11)

Liens arising from filing Uniform Commercial Code financing statements regarding leases;



(12)

Liens securing all of the Notes and Liens securing any Note Guarantee;



(13)

Liens existing on the Issue Date;



(14)

Liens in favor of the Issuer or a Guarantor;



(15)

Liens securing obligations with respect to Indebtedness incurred under clause (1) of the definition of "Permitted Indebtedness";



(16)

Liens securing Purchase Money Indebtedness and Capitalized Lease Obligations; provided that such Liens shall not extend to any asset other than the specified asset being financed and additions and improvements thereon;



(17)

Liens securing Acquired Indebtedness permitted to be incurred under the Indenture; provided that the Liens do not extend to assets not subject to such Lien at the time of acquisition (other than improvements thereon) and are no more favorable to the lienholders than those securing such Acquired Indebtedness prior to the incurrence of such Acquired Indebtedness by the Issuer or a Restricted Subsidiary;



(18)

Liens on assets of Foreign Subsidiaries securing Indebtedness of Foreign Subsidiaries;



(19)

Liens on assets or Equity Interests of a Person existing at the time such Person is acquired or merged with or into or consolidated with the Issuer or any such Restricted Subsidiary (and not created in anticipation or contemplation thereof);



(20)

Liens to secure Refinancing Indebtedness of Indebtedness secured by Liens referred to in the foregoing clauses (13), (16), (17) and (19); provided that such Liens do not extend to any additional assets (other than improvements thereon and replacements thereof);



(21)

Liens to secure Attributable Indebtedness; provided that any such Lien shall not extend to or cover any assets of the Issuer or any Restricted Subsidiary other than the assets which are the subject of the Sale and Leaseback Transaction in which the Attributable Indebtedness is incurred;



(22)

Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the importation of goods;



(23)

Liens securing Hedging Obligations permitted to be incurred under the Indenture;



(24)

Liens incurred in the ordinary course of business of the Issuer or any Restricted Subsidiary with respect to obligations that do not in the aggregate exceed $25.0 million at any one time outstanding; and



(25)

Liens securing Indebtedness permitted to be incurred pursuant to the covenant described under "—Limitations on Additional Indebtedness"; provided that at the time of incurrence and after giving pro forma effect thereto, the Consolidated Secured Debt Ratio would be no greater than 3:50 to 1:00.

        "Person" means any individual, corporation, partnership, limited liability company, joint venture, incorporated or unincorporated association, joint-stock company, trust, unincorporated organization or government or other agency or political subdivision thereof or other entity of any kind.

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        "Preferred Stock" means, with respect to any Person, any and all Capital Stock (however designated) of such Person whether now outstanding or issued after the Issue Date with preferential rights of payment of dividends or upon liquidation, dissolution or winding up.

        "principal" means, with respect to the Notes, the principal of, and premium, if any, on the Notes.

        "Purchase Money Indebtedness" means Indebtedness, including Capitalized Lease Obligations, of the Issuer or any Restricted Subsidiary incurred for the purpose of financing all or any part of the purchase price or lease of property, plant or equipment used or useful in the business of the Issuer or any Restricted Subsidiary or the cost of installation, construction or improvement thereof whether securing the direct purchase of assets or the Capital Stock of any Person owning such assets; provided, however, that (1) the amount of such Indebtedness shall not exceed such purchase price or cost and (2) such Indebtedness shall be incurred within 180 days after the acquisition or lease of such asset by the Issuer or such Restricted Subsidiary or such installation, construction or improvement.

        "Qualified Equity Interests" means Equity Interests of the Issuer other than Disqualified Equity Interests; provided that such Equity Interests shall not be deemed Qualified Equity Interests to the extent sold or owed to a Subsidiary of the Issuer or financed, directly or indirectly, using funds (1) borrowed from the Issuer or any Subsidiary of the Issuer until and to the extent such borrowing is repaid or (2) contributed, extended, guaranteed or advanced by the Issuer or any Subsidiary of the Issuer (including, without limitation, in respect of any employee stock ownership or benefit plan).

        "Qualified Equity Offering" means the issuance and sale of Qualified Equity Interests of the Issuer or any Equity Interests of any direct or indirect parent of the Issuer to Persons other than any Permitted Holder or any other Person who is not, prior to such issuance and sale, an Affiliate of the Issuer, other than in connection with a transaction or series of transactions constituting a Change of Control; provided, however, that if such issuance is made by any direct or indirect parent of the Issuer, cash proceeds therefrom equal to not less than 100% of the aggregate principal amount of any Notes to be redeemed are received by the Issuer as a contribution to the common equity capital of the Issuer immediately prior to such redemption.

        "Rating Agencies" means Moody's and S&P or if Moody's or S&P or both shall not make a rating on the Notes publicly available, a nationally recognized statistical rating agency or agencies, as the case may be, selected by the Issuer which shall be substituted for Moody's or S&P or both, as the case may be.

        "redeem" means to redeem, repurchase, purchase, defease, retire, discharge or otherwise acquire or retire for value; and "redemption" shall have a correlative meaning; provided that this definition shall not apply for purposes of "—Optional Redemption."

        "Redesignation" has the meaning given to such term in the covenant described under "—Certain Covenants—Limitations on Designation of Unrestricted Subsidiaries."

        "refinance" means to refinance, repay, prepay, replace, renew or refund, including successively.

        "Refinancing Indebtedness" means Indebtedness of the Issuer or a Restricted Subsidiary issued in exchange for, or the proceeds of which are used, within 90 days of such issuance or receipt of such proceeds to redeem or refinance in whole or in part, or constituting an amendment of, any Indebtedness of the Issuer or any Restricted Subsidiary (the "Refinanced Indebtedness"); provided that:

(1)

the principal amount (or accreted value, in the case of Indebtedness issued at a discount) of the Refinancing Indebtedness does not exceed the principal amount (or accreted value, as the case may be) of the Refinanced Indebtedness plus the amount of accrued and unpaid interest on the Refinanced Indebtedness, any premium paid to the holders of the Refinanced Indebtedness, defeasance costs and reasonable expenses incurred in connection with the incurrence of the Refinancing Indebtedness;

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(2)

the obligor of Refinancing Indebtedness does not include any Person (other than the Issuer or any Guarantor) that is not an obligor of the Refinanced Indebtedness;



(3)

if the Refinanced Indebtedness was subordinated to the Notes or the Note Guarantees, as the case may be, then such Refinancing Indebtedness, by its terms, is subordinate in right of payment to the Notes or the Note Guarantees, as the case may be, at least to the same extent as the Refinanced Indebtedness is subordinated in right of payment to, the Notes or the Note Guarantees, as the case may be;



(4)

the Refinancing Indebtedness is scheduled to mature no earlier than the earlier of (a) the maturity of the Refinanced Indebtedness being repaid or amended or (b) the maturity date of the Notes; and



(5)

the portion, if any, of the Refinancing Indebtedness that is scheduled to mature on or prior to the maturity date of the Notes has a Weighted Average Life to Maturity at the time such Refinancing Indebtedness is incurred that is equal to or greater than the Weighted Average Life to Maturity of the portion of the Refinanced Indebtedness being repaid that is scheduled to mature on or prior to the maturity date of the Notes.

        "Restricted Payment" means any of the following:

(1)

the declaration or payment of any dividend or any other distribution on Equity Interests of the Issuer or any Restricted Subsidiary, including, without limitation, any payment in connection with any merger or consolidation involving the Issuer but excluding (a) dividends or distributions payable solely in Qualified Equity Interests and (b) in the case of Restricted Subsidiaries, dividends or distributions payable to the Issuer or to a Restricted Subsidiary and pro rata dividends or distributions payable to minority stockholders of any Restricted Subsidiary;



(2)

the redemption of any Equity Interests of the Issuer or any Restricted Subsidiary, including, without limitation, any payment in connection with any merger or consolidation involving the Issuer but excluding any such Equity Interests held by the Issuer or any Restricted Subsidiary;



(3)

any Investment other than a Permitted Investment; or



(4)

any redemption prior to the scheduled maturity or prior to any scheduled repayment of principal or sinking fund payment, as the case may be, in respect of Subordinated Indebtedness.

        "Restricted Payments Basket" has the meaning given to such term in the first paragraph of the covenant described under "—Certain Covenants—Limitations on Restricted Payments."

        "Restricted Subsidiary" means any Subsidiary of the Issuer other than an Unrestricted Subsidiary.

        "Restructuring Expenses" means losses, expenses and charges incurred in connection with restructuring within the Issuer and/or one or more Restricted Subsidiaries, including in connection with integration of acquired businesses or Persons, disposition of one or more Subsidiaries or businesses, exiting of one or more lines of businesses and relocation or consolidation of facilities, including severance, lease termination and other non-ordinary course, non-operating costs and expenses in connection therewith.

        "S&P" means Standard & Poor's Ratings Services, a division of the McGraw-Hill Companies, Inc., and its successors.

        "Sale and Leaseback Transactions" means with respect to any Person an arrangement with any bank, insurance company or other lender or investor or to which such lender or investor is a party, providing for the leasing by such Person of any asset of such Person which has been or is being sold or transferred by such Person to such lender or investor or to any Person to whom funds have been or are to be advanced by such lender or investor on the security of such asset.

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        "SEC" means the U.S. Securities and Exchange Commission.

        "Secretary's Certificate" means a certificate signed by the Secretary of the Issuer.

        "Securities Act" means the U.S. Securities Act of 1933, as amended.

        "Significant Subsidiary" means (1) any Restricted Subsidiary that would be a "significant subsidiary" as defined in Regulation S-X promulgated pursuant to the Securities Act as such Regulation is in effect on the Issue Date and (2) any Restricted Subsidiary that, when aggregated with all other Restricted Subsidiaries that are not otherwise Significant Subsidiaries and as to which any event described in clause (7) or (8) under "—Events of Default" has occurred and is continuing, would constitute a Significant Subsidiary under clause (1) of this definition.

        "Sponsor" means Veritas Capital Fund Management, L.L.C. and its Affiliates and funds or partnerships managed by it or its Affiliates but not including any portfolio companies of the foregoing.

        "Subordinated Indebtedness" means Indebtedness of the Issuer or any Guarantor that is by its terms subordinated in right of payment to the Notes or the Note Guarantees, respectively.

        "Subject Transaction" means any of the Transactions, any future acquisition, investment, disposition, issuance, incurrence or repayment of Indebtedness, offering, issuance or disposition of Equity Interests, recapitalization, merger, consolidation, disposed or discontinued operation, multi-year strategic initiative or any other cost saving action or initiative made by the Issuer or any of its Restricted Subsidiaries, including through mergers or consolidations, or any Person or any of its Restricted Subsidiaries acquired by the Issuer or any of its Restricted Subsidiaries, and including any related financing transactions and including increases in ownership of Restricted Subsidiaries.

        "Subsidiary" means, with respect to any Person:

(1)

any corporation, limited liability company, association or other business entity of which more than 50% of the total voting power of the Equity Interests entitled (without regard to the occurrence of any contingency) to vote in the election of the Board of Directors thereof are at the time owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of that Person (or a combination thereof) or is consolidated under GAAP with such Person; and



(2)

any partnership (a) the sole general partner or the managing general partner of which is such Person or a Subsidiary of such Person or (b) the only general partners of which are such Person or one or more Subsidiaries of such Person (or any combination thereof) or (c) or is consolidated under GAAP with such Person.

        Unless otherwise specified, "Subsidiary" refers to a Subsidiary of the Issuer.

        "Subsidiary Guarantor" means any Guarantor other than Parent.

        "Transactions" means the Merger and the transactions related thereto, the offering of the Notes, the equity contribution by affiliates of the Sponsor, the refinancing of the existing senior credit facilities of Communications & Power Industries, Inc., the 8% Senior Subordinated Notes and the Floating Rate Notes and borrowings made on the Issue Date pursuant to the Credit Agreement.

        "Treasury Rate" means, with respect to a Redemption Date, the yield to maturity at the time of computation of United States Treasury securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519) that has become publicly available at least two Business Days prior to such Redemption Date (or, if such Statistical Release is no longer published, any publicly available source of similar market data)) most nearly equal to the period from such Redemption Date to February 15, 2015; provided, however, that if the period from such Redemption Date to February 15, 2015 is not equal to the constant maturity of the United States Treasury security for which a weekly average yield is given, the Treasury Rate shall be obtained by linear interpolation (calculated to the nearest one-twelfth of a year) from the weekly average yields of

190

United States Treasury securities for which such yields are given, except that if the period from such Redemption Date to February 15, 2015 is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year shall be used.

        "Trust Indenture Act" means the Trust Indenture Act of 1939, as amended.

        "Unrestricted Subsidiary" means (1) any Subsidiary that at the time of determination shall be designated an Unrestricted Subsidiary by the Board of Directors of the Issuer in accordance with the covenant described under "—Certain Covenants—Limitations on Designation of Unrestricted Subsidiaries" and (2) any Subsidiary of an Unrestricted Subsidiary.

        "U.S. Government Obligations" means direct non-callable obligations of, or obligations guaranteed by, the United States of America for the payment of which guarantee or obligations the full faith and credit of the United States is pledged.

        "Voting Stock" with respect to any Person, means securities of any class of Equity Interests of such Person entitling the holders thereof (whether at all times or only so long as no senior class of stock or other relevant equity interest has voting power by reason of any contingency) to vote in the election of members of the Board of Directors of such Person.

        "Weighted Average Life to Maturity" when applied to any Indebtedness at any date, means the number of years obtained by dividing (1) the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturity or other required payment of principal, including payment at final maturity, in respect thereof by (b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment by (2) the then outstanding principal amount of such Indebtedness.

        "Wholly-Owned Restricted Subsidiary" means a Restricted Subsidiary of which 100% of the Equity Interests (except for directors' qualifying shares or certain minority interests owned by other Persons solely due to local law requirements that there be more than one stockholder, but which interest is not in excess of what is required for such purpose) are owned directly by the Issuer or through one or more Wholly-Owned Restricted Subsidiaries.

Book-Entry, Delivery And Form Of Securities

        The Notes will be represented by one or more global notes (the "Global Notes") in registered, global form without interest coupons. The Global Notes will be deposited on the Issue Date with, or on behalf of, DTC and registered in the name of Cede & Co., as nominee of DTC (such nominee being referred to herein as the "Global Note Holder"). DTC will maintain the Notes in denominations of $1,000 and integral multiples thereof through its book-entry facilities.

        DTC has advised the Issuer as follows:

        DTC is a limited-purpose trust company that was created to hold securities for its participating organizations, including Euroclear and Clearstream (collectively, the "Participants" or the "Depositary's Participants"), and to facilitate the clearance and settlement of transactions in these securities between Participants through electronic book-entry changes in accounts of its Participants. The Depositary's Participants include securities brokers and dealers (including the initial purchasers), banks and trust companies, clearing corporations and certain other organizations. Access to DTC's system is also available to other entities such as banks, brokers, dealers and trust companies (collectively, the "Indirect Participants" or the "Depositary's Indirect Participants") that clear through or maintain a custodial relationship with a Participant, either directly or indirectly. Persons who are not Participants may beneficially own securities held by or on behalf of DTC only through the Depositary's Participants or the Depositary's Indirect Participants. Pursuant to procedures established by DTC, ownership of the Notes will be shown on, and the transfer of ownership thereof will be effected only through, records maintained by DTC (with respect to the interests of the Depositary's Participants) and

191

the records of the Depositary's Participants (with respect to the interests of the Depositary's Indirect Participants).

        The laws of some states require that certain persons take physical delivery in definitive form of securities that they own. Consequently, the ability to transfer the Notes will be limited to such extent.

        So long as the Global Note Holder is the registered owner of any Notes, the Global Note Holder will be considered the sole Holder of outstanding Notes represented by such Global Notes under the Indenture. Except as provided below, owners of Notes will not be entitled to have Notes registered in their names and will not be considered the owners or holders thereof under the Indenture for any purpose, including with respect to the giving of any directions, instructions, or approvals to the Trustee thereunder. None of the Issuer, the Guarantors or the Trustee will have any responsibility or liability for any aspect of the records relating to or payments made on account of Notes by DTC, or for maintaining, supervising or reviewing any records of DTC relating to such Notes.

        Payments in respect of the principal of, premium, if any, and interest on any Notes registered in the name of a Global Note Holder on the applicable record date will be payable by the Trustee to or at the direction of such Global Note Holder in its capacity as the registered holder under the Indenture. Under the terms of the Indenture, the Issuer and the Trustee may treat the persons in whose names any Notes, including the Global Notes, are registered as the owners thereof for the purpose of receiving such payments and for any and all other purposes whatsoever. Consequently, neither the Issuer or the Trustee has or will have any responsibility or liability for the payment of such amounts to beneficial owners of Notes (including principal, premium, if any, and interest). The Issuer believes, however, that it is currently the policy of DTC to immediately credit the accounts of the relevant Participants with such payments, in amounts proportionate to their respective beneficial interests in the relevant security as shown on the records of DTC. Payments by the Depositary's Participants and the Depositary's Indirect Participants to the beneficial owners of Notes will be governed by standing instructions and customary practice and will be the responsibility of the Depositary's Participants or the Depositary's Indirect Participants.

        Subject to certain conditions, any person having a beneficial interest in the Global Notes may, upon request to the Trustee and confirmation of such beneficial interest by the Depositary or its Participants or Indirect Participants, exchange such beneficial interest for Notes in definitive form. Upon any such issuance, the Trustee is required to register such Notes in the name of and cause the same to be delivered to, such person or persons (or the nominee of any thereof). Such Notes would be issued in fully registered form. In addition, if (1) the Depositary notifies the Issuer in writing that DTC is no longer willing or able to act as a depositary and the Issuer is unable to locate a qualified successor within 90 days or (2) the Issuer, at its option, notifies the Trustee in writing that it elects to cause the issuance of Notes in definitive form under the Indenture, then, upon surrender by the relevant Global Note Holder of its Global Note, Notes in such form will be issued to each person that such Global Note Holder and DTC identifies as being the beneficial owner of the related Notes.

        Neither the Issuer nor the Trustee will be liable for any delay by the Global Note Holder or DTC in identifying the beneficial owners of Notes and the Issuer and the Trustee may conclusively rely on, and will be protected in relying on, instructions from the Global Note Holder or DTC for all purposes.

192

CERTAIN UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS

        The exchange of an outstanding note for an exchange note pursuant to the exchange offer will not constitute a "significant modification" of the outstanding note for United States federal income tax purposes and, accordingly, the exchange note received will be treated as a continuation of the outstanding note in the hands of such holder. As a result, there will be no United States federal income tax consequences to a holder who exchanges an outstanding note for an exchange note pursuant to the exchange offer and any such holder will have the same adjusted tax basis and holding period in the exchange note as it had in the outstanding note immediately before the exchange. A holder who does not exchange its outstanding note for an exchange note pursuant to the exchange offer will not recognize any gain or loss, for United States federal income tax purposes, upon consummation of the exchange offer.

193

PLAN OF DISTRIBUTION

        Each broker-dealer that receives exchange notes for its own account pursuant to the exchange offer must acknowledge that it will deliver a prospectus in connection with any resale of the exchange notes. This prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of exchange notes received in exchange for outstanding notes where the outstanding notes were acquired as a result of market-making activities or other trading activities. To the extent any such broker-dealer participates in the exchange offer and so notifies us, or causes us to be so notified in writing, we have agreed that for a period of up to 180 days after the date of this prospectus, we will use our reasonable efforts to make this prospectus, as amended or supplemented, available to such broker-dealer for use in connection with any such resale, and will deliver as many additional copies of this prospectus and each amendment or supplement to this prospectus and any documents incorporated by reference in this prospectus as such broker-dealer may reasonably request. In addition, until                        , 2011, all dealers that effect transactions in the exchange notes, whether or not participating in the exchange offer, may be required to deliver a prospectus. This is in addition to the dealers' obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

        We will not receive any proceeds from any sale of exchange notes by broker-dealers. Exchange notes received by broker-dealers for their own accounts pursuant to the exchange offer may be sold from time to time in one or more transactions in the over-the-counter market, in negotiated transactions, through the writing of options on the exchange notes or a combination of these methods of resale, at market prices prevailing at the time of resale, at prices related to the prevailing market prices or negotiated prices. Any resale may be made directly to purchasers or to or through brokers or dealers who may receive compensation in the form of commissions or concessions from any broker-dealer or the purchasers of any exchange notes. Any broker-dealer that resells exchange notes that were received by it for its own account pursuant to the exchange offer and any broker or dealer that participates in a distribution of the exchange notes may be deemed to be an "underwriter" within the meaning of the Securities Act and any profit on any resale of exchange notes and any commissions or concessions received by these persons may be deemed to be underwriting compensation under the Securities Act. The letter of transmittal states that by acknowledging that it will deliver and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an "underwriter" within the meaning of the Securities Act.

        We have agreed to pay all expenses incident to the exchange offer, including the expenses of one counsel for the holders of all of the sellers of outstanding notes, other than commissions or concessions of any brokers or dealers and will indemnify the holders of outstanding notes, including any broker-dealers, against certain liabilities, including liabilities under the Securities Act.

194

CERTAIN ERISA CONSIDERATIONS

        The Employee Retirement Income Security Act of 1974, as amended ("ERISA") imposes certain requirements on "employee benefit plans" (as defined in ERISA) subject to Title I of ERISA, including entities such as collective investment funds and separate accounts whose underlying assets include the assets of such plans (collectively, the "ERISA Plans") and on those persons who are fiduciaries with respect to ERISA Plans.

        Section 406 of ERISA and Section 4975 of the Code, prohibit certain transactions involving the assets of an ERISA Plan (Section 4975 of the Code also imposes prohibitions for certain plans that are not subject to Title I of ERISA but which are subject to Section 4975 of the Code, such as individual retirement accounts (together with the ERISA Plans, the "Plans")) and certain persons (referred to as "parties in interest" or "disqualified persons") having certain relationships to such Plans, unless a statutory or administrative exemption is applicable to the transaction. A party in interest or disqualified person who engages in a prohibited transaction may be subject to excise taxes and other penalties and liabilities under ERISA and Section 4975 of the Code. Accordingly, each original or subsequent purchaser or transferee of a note is responsible for determining that its purchase and holding of such note will not constitute a non-exempt prohibited transaction under ERISA or Section 4975 of the Code.

        THE PRECEDING DISCUSSION IS ONLY A SUMMARY OF CERTAIN IMPLICATIONS OF AN INVESTMENT IN THE NOTES UNDER ERISA AND SECTION 4975 OF THE CODE AND DOES NOT PURPORT TO BE COMPLETE. PROSPECTIVE INVESTORS SHOULD CONSULT WITH THEIR OWN LEGAL, TAX, FINANCIAL AND OTHER ADVISORS PRIOR TO INVESTING IN THE NOTES TO REVIEW THESE IMPLICATIONS IN LIGHT OF SUCH INVESTOR'S PARTICULAR CIRCUMSTANCES.

195

LEGAL MATTERS

        Certain legal matters with respect to the validity of the exchange notes and related guarantees offered hereby will be passed upon for us by Skadden, Arps, Slate, Meagher & Flom LLP, New York, New York.

EXPERTS

        The balance sheet of Parent as of January 31, 2011 and the consolidated financial statements of the Predecessor and subsidiaries as of October 1, 2010 and October 2, 2009 and for each of the years in the three-year period ended October 1, 2010, and management's assessment of the effectiveness of internal control over financial reporting as of October 1, 2010 have been included herein in reliance upon the reports of KPMG LLP, independent registered public accounting firm, appearing elsewhere herein, and upon the authority of said firm as experts in accounting and auditing.

WHERE YOU CAN FIND ADDITIONAL INFORMATION

        We and the guarantors have filed with the SEC a registration statement on Form S-4 under the Securities Act with respect to the exchange notes being offered hereby. This prospectus, which forms a part of the registration statement, does not contain all of the information set forth in the registration statement. For further information with respect to us, the guarantors or the Exchange Notes, reference is made to the registration statement. Statements contained in this prospectus as to the contents of any contract or other document are not necessarily complete. We are not currently subject to the informational requirements of the Exchange Act. As a result of the offering of the exchange notes, we will become subject to the informational requirements of the Exchange Act, and, in accordance therewith, will file reports and other information with the SEC. The registration statements, such reports and other information can be inspected and copied at the Public Reference Room of the SEC located at Room 1580, 100 F Street, N.E., Washington D.C. 20549. Copies of such materials, including copies of all or any portion of the registration statement, can be obtained from the Public Reference Room of the SEC at prescribed rates. You can call the SEC at 1-800-SEC-0330 to obtain information on the operation of the Public Reference Room. Such materials may also be accessed electronically by means of the SEC's home page on the Internet (http://www.sec.gov).

196

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

AUDITED CONSOLIDATED BALANCE SHEET OF CPI INTERNATIONAL HOLDING CORP.
Report of Independent Registered Public Accounting Firm	F-2
Consolidated Balance Sheet	F-3
Notes to Consolidated Balance Sheet	F-4
AUDITED CONSOLIDATED FINANCIAL STATEMENTS OF CPI INTERNATIONAL, INC. AND SUBSIDIARIES*
Report Of Independent Registered Public Accounting Firm	F-6
Management's Annual Report On Internal Control Over Financial Reporting	F-7
Consolidated Balance Sheets	F-8
Consolidated Statements Of Income	F-9
Consolidated Statements Of Stockholders' Equity And Comprehensive Income	F-10
Consolidated Statements Of Cash Flows	F-11
Notes To Consolidated Financial Statements	F-12
UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS OF CPI INTERNATIONAL, INC. AND SUBSIDIARIES*
Condensed Consolidated Balance Sheets	F-67
Condensed Consolidated Statements of Income and Comprehensive Income	F-68
Condensed Consolidated Statements of Cash Flows	F-69
Notes to Unaudited Condensed Consolidated Financial Statements	F-70

*

On February 11, 2011, CPI International LLC (formerly, CPI International, Inc., "Predecessor"), a then Delaware corporation, completed its merger with Catalyst Acquisition, Inc. ("Merger Sub"), a Delaware corporation and wholly owned subsidiary of CPI International Acquisition, Inc., a Delaware corporation, whereby Merger Sub merged with and into Predecessor (the "Merger"), with Predecessor continuing as the surviving corporation and a wholly owned subsidiary of CPI International Acquisition, Inc. Immediately following the consummation of the Merger and related transactions, Predecessor was converted into a limited liability company and liquidated, and CPI International Acquisition, Inc. changed its name to CPI International, Inc.

The consolidated financial statements herein are those of Predecessor and its consolidated subsidiaries for periods prior to the Merger.

F-1

Report of Independent Registered Public Accounting Firm

The Board of Directors and Stockholder
CPI International Holding Corp.:

        We have audited the accompanying consolidated balance sheet of CPI International Holding Corp. and subsidiary as of January 31, 2011. This consolidated financial statement is the responsibility of the Company's management. Our responsibility is to express an opinion on this consolidated financial statement based on our audit.

        We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

        In our opinion, the consolidated balance sheet referred to above presents fairly, in all material respects, the financial position of CPI International Holding Corp. and subsidiary as of January 31, 2011, in conformity with U.S. generally accepted accounting principles.

(signed) KPMG LLP

Mountain View, California
April 7, 2011

F-2

CPI INTERNATIONAL HOLDING CORP.

CONSOLIDATED BALANCE SHEET
As of January 31, 2011

Assets
	Other receivable		$	10
		Total assets	$	10
Liabilities and stockholder's equity
Other payable			$	21
Stockholder's Equity:
	Common stock (par value $0.01, 1,000 shares authorized, 1,000 shares issued and outstanding)			10
	Due from stockholder			(10	)
	Accumulated deficit			(11	)
		Total liabilities and stockholder's equity	$	10

See accompanying notes to consolidated balance sheet.

F-3

CPI INTERNATIONAL HOLDING CORP.

NOTES TO CONSOLIDATED BALANCE SHEET

1. Organization

        CPI International Holding Corp. (the "Company") was incorporated in Delaware on January 18, 2011 initially under the name Catalyst Holdings 2, Inc. Under the Company's Certificate of Incorporation, as amended, the Company is authorized to issue up to 1,000 shares of common stock, each having a par value of one penny ($0.01). On January 18, 2011, the Company issued all 1,000 shares of its authorized common stock to CPI International Holding LLC (formerly Catalyst Holdings LLC, "Holding LLC"), a Delaware limited liability company, for $10.00.

        On January 26, 2011, the Company purchased from The Veritas Capital Fund IV, L.P. ("Sponsor"), a Delaware limited partnership, all 1,000 issued and outstanding shares of CPI International, Inc. (formerly Catalyst Holdings, Inc. and CPI International Acquisition, Inc., "CPII"), a Delaware corporation, for $21.00, and CPII became a wholly owned subsidiary of the Company.

        Each of the Company and CPII was formed solely for the purpose of effectuating the Merger (defined below) and related transactions and has not conducted any unrelated activities since its incorporation. Consequently, the only accounts on CPII's balance sheet are common stock and due from stockholder, each of which amounted to $10.00 as of January 31, 2011.

2. Merger agreement

        On November 24, 2010, CPII, CPI International LLC (formerly, CPI International, Inc., "Predecessor"), a then Delaware corporation and a publicly traded company and Catalyst Acquisition, Inc. ("Merger Sub"), a Delaware corporation and wholly-owned subsidiary of CPII, entered into an agreement and plan of merger pursuant to which CPII was to acquire Predecessor through the merger of Merger Sub with and into Predecessor (the "Merger"). See note 3, Subsequent Events.

3. Subsequent events

        Pursuant to the agreement and plan of merger, dated as of November 24, 2010, among CPII, Predecessor and Merger Sub, on February 11, 2011, Merger Sub merged with and into Predecessor, with Predecessor continuing as the surviving corporation and a wholly owned subsidiary of CPII, and the separate corporate existence of Merger Sub ceased. Predecessor's common stock is no longer publicly traded as a result of the Merger. Immediately following the consummation of the Merger and related transactions, Predecessor was converted into a limited liability company and liquidated, and CPII changed its name to CPI International, Inc. from CPI International Acquisition, Inc. Consequently, CPII now owns all of the outstanding equity interests of Communications & Power Industries LLC (formerly Communications & Power Industries, Inc., "CPI") and Communications & Power Industries Canada Inc., its main operating subsidiaries.

        In connection with the Merger, Sponsor and certain of its affiliates invested $200.0 million, solely for the purpose of purchasing equity securities of Holding LLC in order to provide a portion of the financing required for the Merger and the transactions contemplated by the merger agreement. Certain officers of Predecessor also invested in equity securities of Holding LLC in an aggregate amount of $11.1 million.

        On February 11, 2011, CPII entered into the senior secured credit facilities consisting of (i) a $150,000 six-year term loan facility; and (ii) a $30,000 five-year revolving credit facility (the "Senior Secured Credit Facilities"). CPII borrowed the full amount of the term loan thereunder, and the

F-4

CPI INTERNATIONAL HOLDING CORP.

NOTES TO CONSOLIDATED BALANCE SHEET

3. Subsequent events (Continued)

revolving credit facility was undrawn at closing (other than for approximately $4,500 of outstanding letters of credit). CPII has the option to increase the amount available under the Senior Secured Credit Facilities by up to an aggregate of $50,000 on an uncommitted basis.

        The revolving credit facility includes borrowing capacity available for letters of credit and for short-term borrowings referred to as the swing line borrowings. CPII's obligations under the Senior Secured Credit Facilities are fully and unconditionally guaranteed by the Company and, subject to certain exceptions, each of the Company's existing and future domestic restricted subsidiaries (other than CPII). In addition, CPII's obligations under the Senior Secured Credit Facilities and the guarantees of those obligations are secured by substantially all of CPII's assets and all of the assets of the guarantors, including but not limited to (a) pledges of all the equity interests held by CPII and each guarantor and (b) a first-priority security interest in, and mortgages on, substantially all of the present and after acquired assets of CPII and each guarantor, in each case subject to certain exceptions.

        Borrowings under the term loan facility and the revolving credit facility bear interest, at CPII's option, at a rate equal to a margin over either (a) a base rate or (b) LIBOR. As of March 29, 2011, the term loan facility bears an interest rate of 4% margin over LIBOR of 1% or 5%. The Senior Secured Credit Facilities are subject to amortization and prepayment requirements and contain customary representations and warranties, covenants, events of default and other provisions.

        In addition, on February 11, 2011, CPII issued $215 million aggregate principal amount of 8.00% Senior Notes due 2018 (the "Notes"). The Notes are CPII's senior unsecured obligations. The Company and, subject to certain exceptions, each of the Company's existing and future domestic restricted subsidiaries (other than CPII) guarantee the Notes on a senior unsecured basis. The Notes bear interest at the rate of 8.0% per year. Subject to certain exceptions, the indenture governing the Notes limits CPII's and its restricted subsidiaries' ability to incur additional indebtedness or issue certain preferred stock; pay dividends and make other restricted payments; make certain investments; sell assets; create liens; consolidate, merge or sell all or substantially of CPII's assets; enter into transactions with affiliates and designate subsidiaries as unrestricted subsidiaries; and contains customary events of default and other provisions.

        CPII used the equity contributions, borrowings under the term loan facility and the net proceeds from the Notes to pay the Merger consideration, repay existing indebtedness of Predecessor and its subsidiaries and to pay Merger-related fees and expenses.

F-5

Report of Independent Registered Public Accounting Firm

The Board of Directors and Stockholders
CPI International, Inc.:

        We have audited the accompanying consolidated balance sheets of CPI International, Inc. and subsidiaries (the Company) as of October 1, 2010 and October 2, 2009, and the related consolidated statements of income, stockholders' equity and comprehensive income, and cash flows for each of the years in the three-year period ended October 1, 2010. We also have audited the Company's internal control over financial reporting as of October 1, 2010, based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). The Company's management is responsible for these consolidated financial statements, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management's Annual Report on Internal Control over Financial Reporting (Item 9A). Our responsibility is to express an opinion on these consolidated financial statements and an opinion on the Company's internal control over financial reporting based on our audits.

        We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audits to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the consolidated financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the consolidated financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinion.

        A company's internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company's internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company's assets that could have a material effect on the financial statements.

        Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

        In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of CPI International, Inc. and subsidiaries as of October 1, 2010 and October 2, 2009, and the results of its operations and its cash flows for each of the years in the three-year period ended October 1, 2010, in conformity with U.S. generally accepted accounting principles. Also in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of October 1, 2010, based on criteria established in Internal Control—Integrated Framework issued by the COSO.

(signed) KPMG LLP

Mountain View, California
December 10, 2010, except as to note 15 and 16,
    as to which the date is April 7, 2011

F-6

CPI INTERNATIONAL, INC.
and Subsidiaries

MANAGEMENT'S ANNUAL REPORT ON INTERNAL CONTROL OVER FINANCIAL REPORTING

        Our management is responsible for establishing and maintaining adequate internal control over financial reporting to provide reasonable assurance regarding the reliability of our financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Internal control over financial reporting includes those policies and procedures that:

(i)

pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions of our assets;



(ii)

provide reasonable assurance that the transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with the authorization of management and/or our board of directors; and



(iii)

provide reasonable assurance regarding the prevention or timely detection of any unauthorized acquisition, use or disposition of our assets that could have a material effect on our financial statements.

        Due to its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate due to changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

        Under the supervision and with the participation of our management, including our chief executive officer and our chief financial officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting using the criteria set forth by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in Internal Control—Integrated Framework. Based on its evaluation, our management concluded that our internal control over financial reporting was effective as of October 1, 2010.

        KPMG LLP, an independent registered public accounting firm, has audited the consolidated financial statements included in this Prospectus and, as part of their audit, has issued its attestation report, included herein, on the effectiveness of our internal control over financial reporting as of October 1, 2010. See "Report of Independent Registered Public Accounting Firm".

F-7

CPI INTERNATIONAL, INC.
and Subsidiaries

CONSOLIDATED BALANCE SHEETS
(in thousands, except per share data)

			October 1, 2010			October 2, 2009
Assets
Current Assets:
	Cash and cash equivalents		$	42,829		$	2 6,152
	Restricted cash			1,804			1,561
	Accounts receivable, net			45,707			45,145
	Inventories			75,208			66,996
	Deferred tax assets			11,030			8,652
	Prepaid and other current assets			6,459			6,700
		Total current assets		183,037			155,206
Property, plant, and equipment, net				54,259			57,912
Deferred debt issue costs, net				1,604			3,609
Intangible assets, net				72,474			75,430
Goodwill				162,225			162,225
Other long-term assets				4,677			3,872
		Total assets	$	478,276		$	458,254
Liabilities and stockholders' equity
Current Liabilities:
	Current portion of long-term debt		$	66,000		$	—
	Accounts payable			24,290			22,665
	Accrued expenses			23,653			19,015
	Product warranty			5,101			3,845
	Income taxes payable			5,022			4,305
	Advance payments from customers			14,218			12,996
		Total current liabilities		138,284			62,826
Deferred income taxes				21,707			24,726
Long-term debt, less current portion				128,934			194,922
Other long-term liabilities				5,411			2,227
		Total liabilities		294,336			284,701
Commitments and contingencies
Stockholders' equity
	Preferred stock ($0.01 par value; 10,000 shares authorized and none issued and outstanding)			—			—
	Common stock ($0.01 par value, 90,000 shares authorized; 17,020 and 16,807 shares issued; 16,813 and 16,601 shares outstanding)			170			168
	Additional paid-in capital			80,015			75,630
	Accumulated other comprehensive (loss) income			(141	)		598
	Retained earnings			106,696			99,957
	Treasury stock, at cost (206 shares)			(2,800	)		(2,800	)
		Total stockholders' equity		183,940			173,553
		Total liabilities and stockholders' equity	$	478,276		$	458,254

The accompanying notes are an integral part of these consolidated financial statements.

F-8

CPI INTERNATIONAL, INC.
and Subsidiaries

CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except per share data)

		Year ended
		October 1, 2010		October 2, 2009			October 3, 2008
Sales		$	360,434	$	332,876		$	370,014
Cost of sales			251,987		239,385			261,086
Gross profit			108,447		93,491			108,928
Operating costs and expenses:
	Research and development		12,429		10,520			10,789
	Selling and marketing		20,794		19,466			21,144
	General and administrative		24,988		20,757			22,951
	Amortization of acquisition-related intangible assets		2,749		2,769			3,103
	Strategic alternative transaction expenses		19,913		—			—
Total operating costs and expenses			80,873		53,512			57,987
Operating income			27,574		39,979			50,941
Interest expense, net			15,213		16,979			19,055
(Gain) loss on debt extinguishment			—		(248	)		633
Income before income taxes			12,361		23,248			31,253
Income tax expense (benefit)			5,622		(218	)		10,804
Net income		$	6,739	$	23,466		$	20,449
Earnings per common share—Basic		$	0.40	$	1.42		$	1.24
Earnings per common share—Diluted		$	0.37	$	1.33		$	1.15
Shares used to compute earnings per common share—Basic			16,571		16,343			16,356
Shares used to compute earnings per common share—Diluted			17,837		17,443			17,684

The accompanying notes are an integral part of these consolidated financial statements.

F-9

CPI INTERNATIONAL, INC.
and Subsidiaries

CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY AND COMPREHENSIVE INCOME

(in thousands)

	Common stock							Accumulated other comprehensive income (loss)					Treasury stock
						Additional paid-in capital					Retained earnings
	Shares			Amount									Shares			Amount			Total
Balances, September 28, 2007		16,370		$	164	$	68,763	$	937		$	56,042		—		$	—		$	125,906
Comprehensive income:
Net income		—			—		—		—			20,449		—			—			20,449
Unrealized loss on cash flow hedges, net of tax benefit of $1,652		—			—		—		(2,697	)		—		—			—			(2,697	)
Unrealized actuarial loss and prior service credit for pension liability, net of tax benefit of $30		—			—		—		(49	)		—		—			—			(49	)
Total comprehensive income																				17,703
Stock-based compensation cost		—			—		2,160		—			—		—			—			2,160
Exercise of stock options		9			—		38		—			—		—			—			38
Tax benefit related to stock option exercises		—			—		5		—			—		—			—			5
Issuance of common stock under employee stock purchase plan		72			1		852		—			—		—			—			853
Issuance of restricted stock awards		89			—		—		—			—		—			—			—
Forfeiture of restricted stock awards		(2	)		—		—		—			—		—			—			—
Purchase of treasury stock		—			—		—		—			—		(206	)		(2,800	)		(2,800	)
Balances, October 3, 2008		16,538			165		71,818		(1,809	)		76,491		(206	)		(2,800	)		143,865
Comprehensive income:
Net income		—			—		—		—			23,466		—			—			23,466
Unrealized gain on cash flow hedges, net of tax expense of $1,471		—			—		—		2,415			—		—			—			2,415
Unrealized actuarial loss and prior service credit for pension liability, net of tax expense of $52		—			—		—		(8	)		—		—			—			(8	)
Total comprehensive income																				25,873
Stock-based compensation cost		—			—		2,729		—			—		—			—			2,729
Exercise of stock options		57			1		83		—			—		—			—			84
Tax benefit related to stock option exercises		—			—		48		—			—		—			—			48
Issuance of common stock under employee stock purchase plan		111			1		952		—			—		—			—			953
Issuance of restricted stock awards		106			1				—			—		—			—			1
Forfeiture of restricted stock awards		(5	)		—		—		—			—		—			—			—
Balances, October 2, 2009		16,807			168		75,630		598			99,957		(206	)		(2,800	)		173,553
Comprehensive income:
Net income		—			—		—		—			6,739		—			—			6,739
Unrealized loss on cash flow hedges, net of tax benefit of $496		—			—		—		(653	)		—		—			—			(653	)
Unrealized actuarial loss and prior service credit for pension liability, net of tax benefit of $22		—			—		—		(86	)		—		—			—			(86	)
Total comprehensive income																				6,000
Stock-based compensation cost		—			—		3,051		—			—		—			—			3,051
Exercise of stock options		126			1		229		—			—		—			—			230
Tax benefit related to stock option exercises		—			—		526		—			—		—			—			526
Issuance of common stock under employee stock purchase plan		49			1		579		—			—		—			—			580
Issuance of restricted stock awards		38			—		—		—			—		—			—			—
Balances, October 1, 2010		17,020		$	170	$	80,015	$	(141	)	$	106,696		(206	)	$	(2,800	)	$	183,940

The accompanying notes are an integral part of these consolidated financial statements.

F-10

CPI INTERNATIONAL, INC.
and Subsidiaries

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

			Year ended
			October 1, 2010			October 2, 2009			October 3, 2008
Cash flows from operating activities
Net income			$	6,739		$	23,466		$	20,449
Adjustments to reconcile net income to net cash provided by operating activities:
	Depreciation			8,076			7,773			7,607
	Amortization of intangible assets			2,996			3,021			3,356
	Write-off of patent application fees			—			83			—
	Amortization of deferred debt issue costs			1,353			1,241			1,197
	Amortization of discount on floating rate senior notes			12			12			15
	Non-cash loss on debt extinguishment			—			144			420
	Discount on repayment of debt			—			(392	)		—
	Non-cash defined benefit pension expense			31			39			55
	Stock-based compensation expense			3,040			2,679			2,135
	Allowance for doubtful accounts			17			6			—
	Deferred income taxes			(5,159	)		(1,000	)		(1,360	)
	Net loss on the disposition of assets			82			130			205
	Net loss (gain) on derivative contracts			374			343			(838	)
	Tax benefit from stock option exercises			806			212			50
	Excess tax benefit on stock option exercises			(593	)		(54	)		(18	)
	Changes in operating assets and liabilities, net of acquired assets and assumed liabilities:
		Restricted cash		(243	)		(785	)		1,479
		Accounts receivable		(579	)		2,197			5,241
		Inventories		(8,200	)		(1,495	)		1,986
		Prepaid and other current assets		(726	)		426			(246	)
		Other long-term assets		(775	)		67			(208	)
		Accounts payable		1,625			1,556			(685	)
		Accrued expenses		5,588			(4,107	)		(4,953	)
		Product warranty		1,256			(314	)		(1,419	)
		Income tax payable, net		2,516			(5,974	)		(1,003	)
		Advance payments from customers		1,222			661			203
		Other long-term liabilities		350			179			213
Net cash provided by operating activities				19,808			30,114			33,881
Cash flows from investing activities
	Capital expenditures			(4,492	)		(3,365	)		(4,262	)
	Acquisitions, net of cash acquired			—			—			1,615
	Payment of patent application fees			(41	)		—			(147	)
	Net cash used in investing activities			(4,533	)		(3,365	)		(2,794	)
Cash flows from financing activities
	Proceeds from stock purchase plan and exercises of stock options			809			1,037			891
	Repayments of debt			—			(30,358	)		(21,000	)
	Purchase of treasury stock			—			—			(2,800	)
	Excess tax benefit on stock option exercises			593			54			18
	Net cash provided by (used in) financing activities			1,402			(29,267	)		(22,891	)
Net increase (decrease) in cash and cash equivalents				16,677			(2,518	)		8,196
	Cash and cash equivalents at beginning of year			26,152			28,670			20,474
	Cash and cash equivalents at end of year		$	42,829		$	26,152		$	28,670
Supplemental cash flow disclosures
	Cash paid for interest		$	13,917		$	16,081		$	18,720
	Cash paid for income taxes, net of refunds		$	8,437		$	6,539		$	13,099

The accompanying notes are an integral part of these consolidated financial statements.

F-11

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

(All tabular amounts in thousands except share and per share amounts)

1. Organization and summary of significant accounting policies

        Organization and Basis of Presentation:    Unless the context otherwise requires, "CPI International" means CPI International, Inc. and "CPI" means Communications & Power Industries, Inc. CPI is a direct subsidiary of CPI International. CPI International is a holding company with no operations of its own. The term the "Company" refers to CPI International and its direct and indirect subsidiaries on a consolidated basis.

        The accompanying consolidated financial statements represent the consolidated results and financial position of CPI International, which is controlled by affiliates of The Cypress Group L.L.C. ("Cypress"). CPI International, through its wholly owned subsidiary, CPI, develops, manufactures, and distributes microwave and power grid Vacuum Electron Devices ("VEDs"), microwave amplifiers, modulators, antenna systems and various other power supply equipment and devices. The Company has two reportable segments, VED and satcom equipment.

        The consolidated financial statements include those of the Company and its subsidiaries. Significant intercompany balances, transactions, and stockholdings have been eliminated in consolidation. Certain prior year amounts have been reclassified to conform to current year presentation.

        The Company's fiscal year is the 52- or 53-week period that ends on the Friday nearest September 30. Fiscal years 2010 and 2009 comprised the 52-week periods ending October 1, 2010 and October 2, 2009, respectively. Fiscal year 2008 comprised the 53-week period ended October 3, 2008. All period references are to the Company's fiscal periods unless otherwise indicated.

        Liquidity:    The Company's cash and cash equivalents as of October 1, 2010 of approximately $42.8 million is not sufficient to repay certain long-term debt totaling $66.0 million currently scheduled to mature in August 2011. The Company intends to obtain replacement financing to repay the respective loan within fiscal year 2011 prior to its scheduled maturity date. The Company has historically financed, and intends to continue to finance, its capital and working capital requirements including debt service and internal growth, through a combination of cash flows from its operations and borrowings under its senior credit facilities.

        While the Company believes that, based on its cash flow from operations and its past history, it will be successful in obtaining the replacement financing with reasonable terms to repay its maturing debt, there are no assurances that such additional refinancing will be successful. If the Company is unable to refinance its debt facility, the Company may need to implement other alternatives such as issuing common stock or securities convertible into common stock to repay its indebtedness. If implemented, these actions could negatively impact its business or dilute its existing stockholders.

        Foreign Currency Translation:    The functional currency of the Company's foreign subsidiaries is the U.S. dollar. Gains or losses resulting from the translation into U.S. dollars of amounts denominated in foreign currencies are included in the determination of net income or loss. Foreign currency translation gains and losses are generally reported on a net basis in the caption "general and administrative" in the consolidated statements of income, except for translation gains or losses on income tax-related assets and liabilities, which are reported in "income tax expense" in the consolidated statements of income.

F-12

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

1. Organization and summary of significant accounting policies (Continued)

        Use of Estimates:    The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of sales and costs and expenses during the reporting period. On an ongoing basis, the Company evaluates its estimates, including those related to revenue recognition; inventory valuation; provision for product warranty; business combinations; recoverability and valuation of recorded amounts of long-lived assets and identifiable intangible assets, including goodwill; recognition and measurement of share-based compensation; and recognition and measurement of current and deferred income tax assets and liabilities. The Company bases its estimates on various factors and information, which may include, but are not limited to, history and prior experience, experience of other enterprises in the same industry, new related events, current economic conditions and information from third-party professionals that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

        Revenue Recognition:    Sales are recognized when persuasive evidence of an arrangement exists, delivery has occurred, the price is fixed or determinable, and collectibility is reasonably assured. The Company's products are generally subject to warranties, and the Company provides for the estimated future costs of repair, replacement or customer accommodation in cost of sales.

        Revenues from contracts that contain multiple elements are accounted for in accordance with Financial Accounting Standards Board ("FASB") Accounting Standards Codification ("ASC") Topic FASB ASC 605-25 "Revenue Recognition—Multiple Element Arrangements." Through October 1, 2010, revenue from these contracts was allocated to each respective element or unit of accounting, based on each element's relative fair value using vendor-specific objective evidence ("VSOE") or third-party evidence ("TPE"), if determinable, and was recognized when the respective revenue recognition criteria for each element was met. Effective October 2, 2010, the Company is required to adopt the provisions of FASB Accounting Standards Update ("ASU") 2009-13, "Revenue Recognition (Topic 605): Multiple Deliverable Revenue Arrangements—A Consensus of the FASB Emerging Issues Task Force," which, among other things, requires revenue to be allocated to each element based on the relative selling price method in the absence of VSOE or TPE. See Note 2.

        The Company has commercial and U.S. Government fixed-price contracts that are accounted for under FASB ASC 605, "Revenue Recognition," Subtopic 35, "Construction-Type and Production-Type Contracts." These contracts have represented not more than 4% of the Company's sales during fiscal years 2010, 2009 and 2008, and are for contracts that generally are greater than one year in duration and that include a significant amount of product development. The Company uses the percentage-of-completion method when reasonably dependable estimates of the extent of progress toward completion, contract revenues and contract costs can be made. The portion of revenue earned or the amount of gross profit earned for a period is determined by measuring the extent of progress toward completion using total cost incurred to date and estimated costs at contract completion.

        Sales under cost-reimbursement contracts, which are primarily for research and development, are recorded as costs are incurred and include estimated earned fees in the proportion that costs incurred

F-13

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

1. Organization and summary of significant accounting policies (Continued)

to date bear to total estimated costs. The fees under certain commercial and U.S. Government contracts may be increased or decreased in accordance with cost or performance incentive provisions that measure actual performance against established targets or other criteria. Such incentive fee awards or penalties are included in revenue at the time the amounts can be reasonably determined.

        Revenue is recorded net of taxes collected from customers that are remitted to governmental authorities, with the collected taxes recorded as current liabilities until remitted to the relevant government authority.

        Cash and Cash Equivalents:    The Company considers all highly liquid short-term investments with original maturities of three months or less, readily convertible to known amounts of cash to be cash equivalents.

        Restricted Cash:    Restricted cash consists primarily of bank guarantees from customer advance payments to the Company's international subsidiaries. The bank guarantees become unrestricted cash when performance under the sales or supply contract is complete.

        Inventories:    Inventories are stated at the lower of average cost or market value, primarily using the average cost method. Costs include labor, material and overhead costs. Overhead costs are based on indirect costs allocated among cost of sales, work-in-process inventory and finished goods inventory. Inventories also include costs and earnings in excess of progress billings for contracts using the percentage-of-completion method of accounting. Progress billings in excess of costs and earnings for contracts using the percentage-of-completion method of accounting are reported in Advance Payments from Customers.

        The Company assesses the valuation of inventory and periodically writes down the value for estimated excess and obsolete inventory based upon actual usage and estimates about future demand. The excess balance determined by this analysis becomes the basis for the Company's excess inventory charge. Management personnel play a key role in the excess inventory review process by providing updated sales forecasts, managing product rollovers and working with manufacturing to maximize recovery of excess inventory. If actual market conditions are less favorable than those projected by management, additional write-downs may be required. If actual market conditions are more favorable than anticipated, inventory previously written down may be sold, resulting in lower cost of sales and higher income from operations than expected in that period.

        Management also reviews the carrying value of inventory for lower of cost or market on an individual product or contract basis. A loss is charged to cost of sales when known if estimated product or contract cost at completion is in excess of net realizable value (selling price less estimated cost of disposal). If actual product or contract cost at completion is different than originally estimated, then a loss or gain provision adjustment is recorded that would have an impact on the Company's operating results.

        Property, Plant and Equipment:    Property, plant and equipment are stated at cost. Major improvements are capitalized, while maintenance and repairs are expensed as incurred. Plant and equipment are depreciated over their estimated useful lives using the straight-line method. Building, land improvements and process equipment are depreciated generally over 25, 20 and 12 years,

F-14

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

1. Organization and summary of significant accounting policies (Continued)

respectively. Machinery and equipment are depreciated generally over 7 to 12 years. Office furniture and equipment are depreciated generally over 5 to 10 years. Leasehold improvements are amortized using the straight-line method over their estimated useful lives, or the remaining term of the lease, whichever is shorter.

Goodwill and Other Intangible Assets: The Company accounts for business combinations using the purchase method of accounting in which intangible assets acquired are recognized and reported apart from goodwill.

        The values assigned to acquired identifiable intangible assets for technology were determined based on the excess earnings method of the income approach. This method determines fair market value using estimates and judgments regarding the expectations of future after-tax cash flows from those assets over their lives, including the probability of expected future contract renewals and sales, all of which are discounted to their present value.

        The Company accounts for goodwill and other intangible assets in accordance with FASB ASC 350, "Intangibles—Goodwill and Other." ASC 350 requires that goodwill and identifiable intangible assets with indefinite useful lives be tested for impairment at least annually. ASC 350 also requires that intangible assets subject to amortization be amortized over their respective estimated useful lives and reviewed for impairment. Identifiable intangible assets are amortized on a straight-line basis over their useful lives of up to 50 years. The Company tests goodwill for impairment annually or more frequently if events and circumstances warrant. The Company's annual testing resulted in no impairment of goodwill in fiscal years 2010, 2009 and 2008.

        Long-Lived Assets:    The Company accounts for long-lived assets in accordance with FASB ASC 360, "Property, Plant and Equipment," and ASC 350, which requires that long-lived and finite-lived intangible assets, including property, equipment and leasehold improvements, be evaluated for impairment whenever events or changes in circumstances indicate that the carrying amount of an asset may not be recoverable. An impairment loss would be recognized when the sum of the undiscounted future net cash flows expected to result from the use of the asset and its eventual disposition is less than its carrying amount. Such impairment loss would be measured as the difference between the carrying amount of the asset and its fair value.

        There were no triggering events identified that would indicate a need to review for impairment of long-lived assets during fiscal years 2010, 2009 and 2008.

        Deferred Debt Issue Costs:    Costs incurred related to the issuance of the Company's long-term debt and other credit facilities are capitalized and amortized over the estimated time the obligations are expected to be outstanding using the effective interest method. Deferred debt issue costs for CPI's revolving credit facility and term loan, CPI's 8% Senior Subordinated Notes due 2012 and CPI International's Floating Rate Senior Notes due 2015 are amortized over the term to maturity of the respective debt of four years, eight years and ten years, respectively. As a result of the Company's debt repurchase or prepayment as discussed in Note 5, $0.2 million and $0.3 million of unamortized deferred debt issue costs were written off and charged to (gain) loss on debt extinguishment in the consolidated statement of income for fiscal years 2009 and 2008, respectively. As the outstanding

F-15

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

1. Organization and summary of significant accounting policies (Continued)

balance of CPI's term loan is expected to be repaid within the next 12 months, the Company has classified $0.7 million of the related unamortized deferred debt issue costs as current (prepaid and other current assets) in the consolidated balance sheet as of October 1, 2010. As of October 1, 2010, and October 2, 2009, gross long-term deferred debt issue costs were $6.4 million and $7.9 million and related accumulated amortization was $4.8 million and $4.3 million, respectively.

        Product Warranty:    The Company's products typically carry warranty periods of one to three years or warranties over a predetermined product usage life. The Company estimates the costs that may be incurred under its warranty plans and records a liability in the amount of such estimated costs at the time revenue is recognized. The determination of product warranty reserves requires the Company to make estimates of product return rates and expected cost to repair or replace the products under warranty. The Company assesses the adequacy of its preexisting warranty liabilities and adjusts the balance based on actual experience and changes in future expectations.

        Business Risks and Credit Concentrations:    Defense-related applications, such as certain radar, electronic countermeasures and military communications applications, constitute a significant portion of the Company's sales. Companies engaged in supplying defense-related equipment and services to government agencies are subject to certain business risks unique to that industry. Sales to the government may be affected by changes in procurement policies, budget considerations, changing concepts of national defense, political developments abroad and other factors.

        Research and Development:    Company-sponsored research and development costs related to both present and future products are expensed as incurred. Customer-sponsored research and development costs are charged to cost of sales to match revenue recognized. Total expenditures incurred by the Company on research and development are summarized as follows:

	Year ended
	October 1, 2010		October 2, 2009		October 3, 2008
CPI Sponsored	$	12,429	$	10,520	$	10,789
Customer Sponsored		16,106		17,526		12,028
	$	28,535	$	28,046	$	22,817

        Advertising Expenses:    Costs related to advertising are recognized in selling and marketing expenses as incurred. Advertising expenses were not material in any of the periods presented.

        Income Taxes:    The Company records income taxes using the asset and liability method. Deferred tax assets and liabilities are recognized for the estimated future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates in effect for the year in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in income in the period that includes the enactment date.

F-16

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

1. Organization and summary of significant accounting policies (Continued)

        In addition, the calculation of the Company's tax liabilities involves dealing with uncertainties in the application of complex tax regulations. In accordance with FASB ASC 740, "Income Taxes," the Company recognizes liabilities for uncertain tax positions based on the two-step process. The first step is to evaluate the tax position for recognition by determining if the weight of available evidence indicates that it is more likely than not that the position will be sustained on audit, including resolution of related appeals or litigation processes, if any. The second step requires the Company to estimate and measure the tax benefit as the largest amount that is more than 50% likely of being realized upon ultimate settlement. It is inherently difficult and subjective to estimate such amounts, as this requires the Company to determine the probability of various possible outcomes. The Company reevaluates these uncertain tax positions on a quarterly basis. This evaluation is based on factors including, but not limited to, changes in facts or circumstances, changes in tax law, effectively settled issues under audit and new audit activity. Such a change in recognition or measurement would result in the recognition of a tax benefit or an additional charge to the tax provision.

        Income tax-related interest expense and income tax-related penalties are reported as a component of the provision for income taxes in the consolidated statement of income.

        See Note 11 for further discussion on income taxes.

        Comprehensive Income:    The Company follows the accounting treatment prescribed by FASB ASC 220, "Comprehensive Income." Comprehensive income is defined as a change in equity of a company during a period from transactions and other events and circumstances, excluding transactions resulting from investments by owners and distributions to owners. The difference between net income and comprehensive income for the Company arises from unrealized gains and losses on cash flow hedge contracts, net of tax, and unrealized actuarial loss and prior service credit for pension liability, net of tax.

2. Recently issued accounting standards

        In the first quarter of fiscal year 2010, the Company adopted provisions of FASB ASC 820, "Fair Value Measurements and Disclosures," that specified the way in which fair value measurements should be made for non-financial assets and non-financial liabilities that are not measured and recorded at fair value on a recurring basis, and specified additional disclosures related to these fair value measurements. The adoption of this new standard did not have an impact on the Company's consolidated results of operations, financial position or cash flows.

        In June 2008, the FASB issued an update to ASC 260, "Earnings Per Share," which addresses whether instruments granted in share-based payment transactions are participating securities prior to vesting and, therefore, need to be included in the earnings allocation in computing earnings per share under the two-class method. The update to ASC 260 requires unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents (whether paid or unpaid) to be treated as participating securities and to be included in the computation of earnings per share pursuant to the two-class method. This guidance under ASC 260 was effective for fiscal years beginning after December 15, 2008, and interim periods within those fiscal years. All prior-period earnings per share data presented shall be adjusted retrospectively. The Company adopted the provisions of this guidance

F-17

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

2. Recently issued accounting standards (Continued)

under ASC 260 effective October 3, 2009 and has included the required disclosures in Note 12 to the consolidated financial statements. The adoption of this guidance did not have a material impact on the Company's computation of earnings per share.

        In October 2008, the FASB issued guidance codified under ASC 715, "Compensation—Retirement Benefits," which requires that an employer disclose the following information about the fair value of plan assets: (1) the level within the fair value hierarchy in which fair value measurements of plan assets fall; (2) information about the inputs and valuation techniques used to measure the fair value of plan assets; and (3) a reconciliation of beginning and ending balances for fair value measurements of plan assets using significant unobservable inputs. At initial adoption, application of this guidance would not be required for earlier periods that are presented for comparative purposes. The Company adopted the provisions of this guidance under ASC 715 effective October 3, 2009. The adoption did not have an impact on the Company's consolidated results of operations, financial position or cash flows.

        In April 2009, the FASB released an amendment to ASC 805, "Business Combinations," which requires an acquirer to recognize at fair value, at the acquisition date, an asset acquired or a liability assumed that arises from a contingency if the acquisition date fair value of that asset or liability can be determined during the measurement period. If the acquisition date fair value cannot be determined during the measurement period, an asset or liability shall be recognized at the acquisition date if (1) information available before the end of the measurement period indicates that it is probable that an asset existed or that a liability had been incurred at the acquisition date, and (2) the amount of the asset or liability can be reasonably estimated. The Company adopted the provisions of the guidance under ASC 805 and its amendment effective October 3, 2009. The impact of the adoption will depend on the nature of acquisitions completed in the future.

        In August 2009, the FASB issued ASU 2009-05, "Measuring Liabilities at Fair Value," an update to ASC 820. This update provides amendments to reduce potential ambiguity in financial reporting when measuring the fair value of liabilities. Among other provisions, this update provides clarification that in circumstances in which a quoted price in an active market for the identical liability is not available, a reporting entity is required to measure fair value using one or more of the valuation techniques described in ASU 2009-05. The Company adopted the provisions of this guidance under ASU 2009-05 effective October 3, 2009. The adoption did not have an impact on the Company's consolidated results of operations, financial position or cash flows.

        In October 2009, the FASB issued ASU 2009-13, "Revenue Recognition (Topic 605): Multiple Deliverable Revenue Arrangements—A Consensus of the FASB Emerging Issues Task Force." This update provides application guidance on whether multiple deliverables exist, how the deliverables should be separated and how the consideration should be allocated to one or more units of accounting. This update eliminates the residual method of allocation for multiple-deliverable revenue arrangements, and requires that arrangement consideration be allocated at the inception of an arrangement to all deliverables using the relative selling price method. The selling price used for each deliverable will be based on VSOE, if available, TPE if VSOE is not available, or estimated selling price if neither VSOE or TPE is available. Additionally, ASU 2009-13 expands the disclosure requirements related to a vendor's multiple-deliverable revenue arrangements. ASU 2009-13 is effective prospectively for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010

F-18

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

2. Recently issued accounting standards (Continued)

and early adoption is permitted. The Company will adopt the provisions of this update under ASU 2009-13 effective October 2, 2010. The Company does not expect ASU 2009-13 to have a material impact on its consolidated results of operations, financial position or cash flows.

        In September 2009, the FASB issued ASU 2009-14, "Certain Revenue Arrangements That Include Software Elements," which is included in the ASC 985, "Software." ASU 2009-14 amends previous software revenue recognition to exclude (a) non-software components of tangible products and (b) software components of tangible products that are sold, licensed, or leased with tangible products when the software components and non-software components of the tangible product function together to deliver the tangible product's essential functionality. ASU 2009-14 is effective for revenue arrangements entered into or materially modified in fiscal years beginning on or after June 15, 2010 and shall be applied on a prospective basis. Earlier application is permitted as of the beginning of an entity's fiscal year. The Company will adopt the provisions of this update under ASU 2009-14 effective October 2, 2010. The Company does not expect ASU 2009-14 to have a material impact on its consolidated results of operations, financial position or cash flows.

        In December 2009, the FASB issued ASU 2009-17, "Improvements to Financial Reporting by Enterprises Involved with Variable Interest Entities," as a further clarification to ASC 810-10, "Consolidation of Variable Interest Entities." ASU 2009-17, upon adoption, requires the use of a qualitative analysis to determine the primary beneficiary of a variable interest entity ("VIE"), amends the guidance for determining if an entity is a VIE and enhances the disclosure requirements regarding an enterprise's involvement with a VIE. ASU 2009-17 is effective as of the beginning of a company's first fiscal year beginning after November 15, 2009. The Company will adopt the provisions of this update under ASU 2009-17 effective October 2, 2010. Since the Company does not currently have variable interest entities, this update is expected to have no impact on its consolidated results of operations, financial position or cash flows.

        In January 2010, the FASB issued ASU 2010-06, "Fair Value Measurements and Disclosures: Improving Disclosures About Fair Value Measurements." This update requires reporting entities to make new disclosures about recurring or nonrecurring fair-value measurements including significant transfers into and out of Level 1 and Level 2 fair-value measurements and information on purchases, sales, issuances, and settlements on a gross basis in the reconciliation of Level 3 fair-value measurements. ASU 2010-06 was effective for interim and annual reporting periods beginning after December 15, 2009, except for Level 3 reconciliation disclosures which are effective for annual periods beginning after December 15, 2010. The Company adopted the provisions of this guidance under ASU 2009-06, except for Level 3 reconciliation disclosures, effective January 2, 2010. As this guidance is disclosure-related, it did not have an impact on the Company's consolidated results of operations, financial position or cash flows.

        In February 2010, the FASB issued ASU 2010-08, "Technical Corrections to Various Topics." This update eliminates inconsistencies and outdated provisions in U.S. generally accepted accounting principles ("GAAP") and provides needed clarification on others. Amendments within ASU 2010-08 that may be applicable to the Company are effective as of the first reporting period beginning after February 2, 2010, the date this ASU was issued. The Company adopted the provisions of this guidance

F-19

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

2. Recently issued accounting standards (Continued)

under ASU 2010-08 effective April 3, 2010 with no material impact on its consolidated results of operations, financial position or cash flows.

        In April 2010, the FASB issued ASU 2010-17, "Revenue Recognition—Milestone Method (Topic 605): Milestone Method of Revenue Recognition." ASU 2010-17 provides guidance on applying the milestone method to milestone payments for achieving specified performance measures when those payments are related to uncertain future events. The scope of ASU 2010-17 is limited to transactions involving research or development. This update further states that the milestone method is not the only acceptable method of revenue recognition for milestone payments. Accordingly, entities can make an accounting policy election to recognize arrangement consideration received for achieving specified performance measures during the period in which the milestones are achieved, provided certain criteria are met. An entity's policy for recognizing deliverable consideration or unit of accounting consideration contingent upon achievement of a milestone shall be applied consistently to similar deliverables or units of accounting. ASU 2010-17 is effective on a prospective basis for milestones achieved in interim and fiscal years beginning after June 15, 2010. Early adoption is permitted. The Company will adopt the provisions of this update under ASU 2010-17 effective October 2, 2010. The Company does not expect ASU 2010-17 to have a material impact on its consolidated results of operations, financial position or cash flows.

3. Supplemental balance sheet information

        Accounts receivable:    Accounts receivable are stated net of allowances for doubtful accounts as follows:

	October 1, 2010			October 2, 2009
Accounts receivable	$	45,819		$	45,240
Less: Allowance for doubtful accounts		(112	)		(95	)
Accounts receivable, net	$	45,707		$	45,145

        The following table sets forth the changes in allowance for doubtful account during fiscal years 2010, 2009 and 2008:

	Year ended
	October 1, 2010			October 2, 2009			October 3, 2008
Balance at beginning of period	$	95		$	89		$	89
Provision for doubtful accounts charged to general and administrative expense		54			17			19
Write-offs against allowance		(37	)		(11	)		(19	)
Balance at end of period	$	112		$	95		$	89

F-20

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

3. Supplemental balance sheet information (Continued)

        Inventories:    The following table provides details of inventories:

	October 1, 2010		October 2, 2009
Raw material and parts	$	42,167	$	38,205
Work in process		24,531		20,542
Finished goods		8,510		8,249
	$	75,208	$	66,996

        Reserve for loss contracts:    The following table summarizes the activity related to reserves for loss contracts during fiscal years 2010 and 2009:

	Year ended
	October 1, 2010			October 2, 2009
Balance at beginning of period	$	4,068		$	1,928
Provision for loss contracts, charged to cost of sales		4,157			4,173
Credit to cost of sales upon revenue recognition		(4,488	)		(2,033	)
Balance at end of period	$	3,737		$	4,068

        Reserve for loss contracts are reported in the consolidated balance sheet in the following accounts:

	October 1, 2010		October 2, 2009
Inventories	$	3,343	$	3,967
Accrued expenses		394		101
	$	3,737	$	4,068

F-21

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

3. Supplemental balance sheet information (Continued)

        Property, Plant and Equipment, Net:    The following table provides details of property, plant and equipment, net:

	October 1, 2010			October 2, 2009
Land	$	2,947		$	2,947
Land improvements		1,861			1,851
Buildings		41,424			40,630
Machinery and equipment		48,610			45,935
Construction in progress		1,023			640
		95,865			92,003
Less: accumulated depreciation and amortization		(41,606	)		(34,091	)
Property, plant and equipment, net	$	54,259		$	57,912

        Intangible Assets:    The following tables present the details of the Company's total acquisition-related intangible assets:

			October 1, 2010							October 2, 2009
	Weighted average useful life (in years)
			Cost		Accumulated amortization			Net		Cost		Accumulated amortization			Net
VED Core Technology		50	$	30,700	$	(4,115	)	$	26,585	$	30,700	$	(3,501	)	$	27,199
VED Application Technology		25		19,800		(5,297	)		14,503		19,800		(4,505	)		15,295
X-ray Generator and Satcom Application Technology		15		8,000		(3,574	)		4,426		8,000		(3,042	)		4,958
Antenna and Telemetry Technology		25		5,300		(665	)		4,635		5,300		(453	)		4,847
Customer backlog		1		580		(580	)		—		580		(580	)		—
Land lease		46		11,810		(1,687	)		10,123		11,810		(1,434	)		10,376
Tradename		20-Indefinite		7,600		(495	)		7,105		7,600		(275	)		7,325
Customer list and programs		24		6,280		(1,485	)		4,795		6,280		(1,218	)		5,062
Noncompete agreement		5		530		(332	)		198		640		(336	)		304
Patent application fees		—		104		—			104		64		—			64
			$	90,704	$	(18,230	)	$	72,474	$	90,774	$	(15,344	)	$	75,430

        Intangible assets, net as of October 1, 2010 and October 2, 2009 include a total of approximately $0.1 million of application costs and associated legal costs incurred to obtain certain patents. Once obtained, these patents will be amortized on a straight-line basis and charged to operations over their estimated useful lives, not to exceed 17 years.

        The amortization of intangible assets amounted to $3.0 million, $3.0 million and $3.4 million for fiscal years 2010, 2009 and 2008, respectively.

F-22

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

3. Supplemental balance sheet information (Continued)

        The estimated future amortization expense of intangible assets, excluding the Company's unamortized tradenames, is as follows:

Fiscal Year	Amount
2011		3,003
2012		3,003
2013		2,883
2014		2,897
2015		2,897
Thereafter		54,591
	$	69,274

        Goodwill:    The following table sets forth the changes in goodwill by reportable segment during fiscal years 2010 and 2009:

	October 1, 2010		October 2, 2009
VED	$	132,621	$	132,621
Satcom equipment		13,720		13,720
Other		15,884		15,884
	$	162,225	$	162,225

        Accrued Expenses:    The following table provides details of accrued expenses:

	October 1, 2010		October 2, 2009
Payroll and employee benefits	$	14,254	$	11,015
Accrued interest		1,735		1,786
Strategic alternative transaction expenses (Note 10)		1,495		—
Other accruals		6,169		6,214
	$	23,653	$	19,015

F-23

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

3. Supplemental balance sheet information (Continued)

        Product Warranty:    The following table summarizes the activity related to product warranty during fiscal years 2010 and 2009:

	Year ended
	October 1, 2010			October 2, 2009
Beginning accrued warranty	$	3,845		$	4,159
Actual costs of warranty claims		(5,451	)		(4,524	)
Estimates for product warranty, charged to cost of sales		6,707			4,210
Ending accrued warranty	$	5,101		$	3,845

4. Financial instruments

        FASB ASC 825 establishes a framework for measuring fair value and expands disclosures about fair value measurements by establishing a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The three levels of the fair value hierarchy under ASC 825 are described as follows:

Level 1	Observable inputs that reflect quoted prices (unadjusted) for identical assets or liabilities in active markets.
Level 2	Inputs reflect quoted prices for identical assets or liabilities in markets that are not active; quoted prices for similar assets or liabilities in active markets; inputs other than quoted prices that are observable for the asset or the liability; or inputs that are derived principally from or corroborated by observable market data by correlation or other means.
Level 3	Unobservable inputs reflecting the Company's own assumptions incorporated in valuation techniques used to determine fair value. These assumptions are required to be consistent with market participant assumptions that are reasonably available.

        Fair value is the price that would be received upon sale of an asset or paid upon transfer of a liability in an orderly transaction between market participants at the measurement date and in the principal or most advantageous market for that asset or liability. The fair value should be calculated based on assumptions that market participants would use in pricing the asset or liability, not on assumptions specific to the entity. In addition, the fair value of liabilities should include consideration of non-performance risk, including the Company's own credit risk.

        The Company's non-financial assets (including goodwill, intangible assets, inventories and long-lived assets) and liabilities are measured at fair value on a non-recurring basis; that is, the assets and liabilities are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances such as when they are deemed to be other-than-temporarily impaired. The fair values of these non-financial assets and liabilities are determined based on valuation techniques using the best information available, and may include quoted market prices, market comparables, and discounted cash flow projections. During fiscal year 2010, no fair value adjustments or material fair value measurements were required for the Company's non-financial assets or liabilities.

F-24

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

4. Financial instruments (Continued)

        The Company measures certain financial assets and liabilities at fair value on a recurring basis, including cash equivalents, restricted cash, available-for-sale securities and derivative instruments. As of October 1, 2010, financial assets utilizing Level 1 inputs included cash equivalents, such as money market and overnight U.S. Government securities and available-for-sale securities, such as mutual funds. Financial assets and liabilities utilizing Level 2 inputs included foreign currency derivatives and interest rate swap derivatives. The Company does not have any financial assets or liabilities requiring the use of Level 3 inputs.

        The following tables set forth financial instruments carried at fair value within the ASC 825 hierarchy:

			Fair value measurements at October 1, 2010 using
	Total		Quoted prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Assets:
Money market and overnight U.S. Government securities(1)	$	36,420	$	36,420	$	—	$	—
Mutual funds(2)		171		171		—		—
Foreign exchange forward derivatives(3)		437		—		437		—
Total assets at fair value	$	37,028	$	36,591	$	437		—
Liabilities:
Interest rate swap derivative(4)	$	816	$	—	$	816	$	—
Total liabilities at fair value	$	816	$	—	$	816	$	—

(1)

The money market and overnight U.S. Government securities are classified as part of cash and cash equivalents and restricted cash in the consolidated balance sheet.

(2)

The mutual funds are classified as part of other long-term assets in the consolidated balance sheet.

(3)

The foreign currency derivatives are classified as part of prepaid and other current assets in the consolidated balance sheet.

F-25

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

4. Financial instruments (Continued)

(4)

The interest rate swap derivatives are classified as part of accrued expenses in the consolidated balance sheet.

			Fair value measurements at October 2, 2009 using
	Total		Quoted Prices in active markets for identical assets (Level 1)		Significant other observable inputs (Level 2)		Significant unobservable inputs (Level 3)
Assets:
Money market and overnight U.S. Government securities(1)	$	22,464	$	22,464	$	—	$	—
Mutual funds(2)		152		152		—		—
Foreign exchange forward derivatives(3)		3,467		—		3,467		—
Total assets at fair value	$	26,083	$	22,616	$	3,467	$	—
Liabilities:
Interest rate swap derivative(4)	$	2,323	$	—	$	2,323	$	—
Total liabilities at fair value	$	2,323	$	—	$	2,323	$	—

(1)

The money market and overnight U.S. Government securities are classified as part of cash and cash equivalents and restricted cash in the consolidated balance sheet.

(2)

The mutual funds are classified as part of other long-term assets in the consolidated balance sheet.

(3)

The foreign currency derivatives are classified as part of prepaid and other current assets in the consolidated balance sheet.

(4)

The interest rate swap derivatives are classified as part of accrued expenses and other long-term liabilities in the consolidated balance sheet.

Investments Other Than Derivatives

        In general and where applicable, the Company uses quoted prices in active markets for identical assets or liabilities to determine fair value. This pricing methodology applies to the Company's Level 1 investments, such as money market, U.S. Government securities and mutual funds.

        If quoted prices in active markets for identical assets or liabilities are not available to determine fair value, then the Company would use quoted prices for similar assets and liabilities or inputs other than the quoted prices that are observable either directly or indirectly. These investments would be included in Level 2.

F-26

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

4. Financial instruments (Continued)

Derivatives

        The Company executes foreign exchange forward contracts to purchase Canadian dollars and holds a pay-fixed receive-variable interest rate swap contract, all executed in the retail market with its relationship banks. To determine the most appropriate value, the Company uses an in-exchange valuation premise which considers the assumptions that market participants would use in pricing the derivatives. The Company has elected to use the income approach and uses observable (Level 2) market expectations at the measurement date and standard valuation techniques to convert future amounts to a single present amount. Level 2 inputs for derivative valuations are midmarket quoted prices for similar assets or liabilities in active markets and inputs other than quoted prices that are observable for the asset or liability.

        Key inputs for currency derivatives are spot rates, forward rates, interest rates and credit derivative rates. The spot rate for the Canadian dollar is the same spot rate used for all balance sheet translations at the measurement date. Forward premiums/discounts and interest rates are interpolated from commonly quoted intervals. Once valued, each forward is identified as either an asset or liability. Assets are further discounted using counterparty annual credit default rates, and liabilities are valued using the Company's credit as reflected in the spread paid over LIBOR on the term loan under the Company's senior credit facilities.

        Key inputs for valuing the interest rate swap are the cash rates used for the short term (under 3 months), futures rates for up to three years and LIBOR swap rates for periods beyond. These inputs are used to derive variable resets for the swap as well as to discount future fixed and variable cash flows to present value at the measurement date. A credit spread is used to further discount each net cash flow using, for assets, counterparty credit default rates and, for liabilities, the Company's credit spread over LIBOR on the term loan under the Company's senior credit facilities.

        See Note 7 for further information regarding the Company's derivative instruments.

Other Financial Instruments

        The Company's other financial instruments include cash, restricted cash, accounts receivable, accounts payable and long-term debt. Except for long-term debt, the carrying value of these financial instruments approximates fair values because of their relatively short maturity.

        The fair values of the Company's long-term debt were estimated using quoted market prices where available. For long-term debt not actively traded, fair values were estimated using discounted cash flow analyses, based on the Company's current estimated incremental borrowing rates for similar types of borrowing arrangements. The estimated fair value of the Company's long-term debt was $192.6 million and $188.5 million as of October 1, 2010 and October 2, 2009, respectively. See Note 5 for the carrying value of the long-term debt.

F-27

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

5. Long-term debt

        Long-term debt comprises the following:

	October 1, 2010		October 2, 2009
Term loan	$	66,000	$	66,000
8% Senior subordinated notes due 2012		117,000		117,000
Floating rate senior notes due 2015, net of issue discount of $66 and $78		11,934		11,922
		194,934		194,922
Less: Current portion		66,000		—
Long-term portion	$	128,934	$	194,922
Standby letters of credit	$	4,544	$	5,544

        Senior Credit Facilities:    CPI's senior credit facilities ("Senior Credit Facilities") provide for borrowings of up to an aggregate principal amount of $160 million, consisting of a $100 million term loan facility ("Term Loan") and a $60 million revolving credit facility ("Revolver"), with a sub-facility of $15 million for letters of credit and $5 million for swing line loans. Upon certain specified conditions, including maintaining a senior secured leverage ratio of 3.75:1 or less on a pro forma basis, CPI may seek commitments for a new class of term loans, not to exceed $125 million in the aggregate. The Senior Credit Facilities are guaranteed by CPI International and all of CPI's domestic subsidiaries and are secured by substantially all of the assets of CPI International, CPI and CPI's domestic subsidiaries.

        Both the Term Loan and the Revolver will mature on August 1, 2011 if, prior to August 1, 2011, CPI has not repaid or refinanced its 8% Senior Subordinated Notes due 2012. If CPI repays or refinances its 8% Senior Subordinated Notes due 2012 prior to August 1, 2011, then the Term Loan would mature on August 1, 2014 and the Revolver would mature on August 1, 2013.

        In August 2007, CPI borrowed $100 million under the Term Loan. Borrowings under the Senior Credit Facilities bear interest at a rate equal to, at CPI's option, LIBOR or the ABR plus the applicable margin. The ABR is the greater of the (a) the prime rate and (b) the federal funds rate plus 0.50%. For Term Loans, the applicable margin is 2.00% for LIBOR borrowings and 1.00% for ABR borrowings. The applicable margins under the Revolver vary depending on CPI's leverage ratio, as defined in the Senior Credit Facilities, and range from 1.25% to 2.00% for LIBOR borrowings and from 0.25% to 1.00% for ABR borrowings.

        In addition to customary fronting and administrative fees under the Senior Credit Facilities, CPI will pay letter of credit participation fees equal to the applicable LIBOR margin per annum on the average daily amount of the letter of credit exposure and a commitment fee on the average daily unused commitments under the Revolver. The commitment fee varies depending on CPI's leverage ratio, as defined in the Senior Credit Facilities and ranges from 0.25% to 0.50%.

        The Senior Credit Facilities require that CPI repay $250,000 of the Term Loan at the end of each fiscal quarter prior to the maturity date of the Term Loan, with the remainder due on the maturity

F-28

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

5. Long-term debt (Continued)

date. CPI is required to prepay its outstanding loans under the Senior Credit Facilities, subject to certain exceptions and limitations, with net cash proceeds received from certain events, including, without limitation, (1) all such proceeds received from certain asset sales by CPI International, CPI or any of CPI's subsidiaries, (2) all such proceeds received from issuances of debt (other than certain specified permitted debt) or preferred stock by CPI International, CPI or any of CPI's subsidiaries, and (3) all such proceeds paid to CPI International, CPI or any of CPI's subsidiaries from casualty and condemnation events in excess of amounts applied to replace, restore or reinvest in any properties for which proceeds were paid within a specified period.

        If CPI's leverage ratio, as defined in the Senior Credit Facilities, exceeds 3.5:1 at the end of any fiscal year, CPI will also be required to make an annual prepayment within 90 days after the end of such fiscal year equal to 50% of excess cash flow, as defined in the Senior Credit Facilities, less optional prepayments made during the fiscal year. CPI can make optional prepayments on the outstanding loans at any time without premium or penalty, except for customary "breakage" costs with respect to LIBOR loans.

        The Senior Credit Facilities contain a number of covenants that, among other things, restrict, subject to certain exceptions, the ability of CPI International, CPI or any of CPI's subsidiaries to: sell assets; engage in mergers and acquisitions; pay dividends and distributions or repurchase their capital stock; incur additional indebtedness or issue equity interests; make investments and loans; create liens or further negative pledges on assets; engage in certain transactions with affiliates; enter into sale and leaseback transactions; amend agreements or make prepayments relating to subordinated indebtedness; and amend or waive provisions of charter documents in a manner materially adverse to the lenders. CPI and its subsidiaries must comply with a maximum capital expenditure limitation and a maximum total secured leverage ratio, each calculated on a consolidated basis for CPI.

        CPI made no payments on the Term Loan during fiscal year 2010. During fiscal years 2009 and 2008, CPI made repayments on the Term Loan of $22.8 million and $11.0 million, respectively. As of October 1, 2010, the principal balance of the Term Loan was $66.0 million.

        At October 1, 2010, the amount available for borrowing under the Revolver, after taking into account the Company's outstanding letters of credit of $4.5 million, was approximately $55.5 million.

        8% Senior Subordinated Notes due 2012 of CPI:    As of October 1, 2010, CPI had $117.0 million in aggregate principal amount of its 8% Senior Subordinated Notes due 2012 (the "8% Notes"). CPI made no repurchase of any of the outstanding 8% Notes during fiscal year 2010. During fiscal year 2009, CPI repurchased a total of $8.0 million. CPI repurchased $3.0 million aggregate principal amount of the 8% Notes in January 2009 at a discount of 8.5% to par value. CPI paid approximately $2.9 million, including accrued interest of $0.1 million, for the repurchase and realized a net gain of approximately $0.2 million. CPI also repurchased $5.0 million aggregate principal amount of the 8% Notes in June 2009 at a discount of 2.75% to par value. CPI paid approximately $5.0 million, including accrued interest of $0.2 million, for the repurchase and realized a net gain of approximately $0.1 million. The 8% Notes have no sinking fund requirements.

        The 8% Notes bear interest at the rate of 8.0% per year, payable on February 1 and August 1 of each year. The 8% Notes will mature on February 1, 2012. The 8% Notes are unsecured obligations,

F-29

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

5. Long-term debt (Continued)

jointly and severally guaranteed by CPI International and each of CPI's domestic subsidiaries. The payment of all obligations relating to the 8% Notes are subordinated in right of payment to the prior payment in full in cash or cash equivalents of all senior debt (as defined in the indenture governing the 8% Notes) of CPI, including debt under the Senior Credit Facilities. Each guarantee of the 8% Notes is and will be subordinated to guarantor senior debt (as defined in the indenture governing the 8% Notes) on the same basis as the 8% Notes are subordinated to CPI's senior debt.

        At any time or from time to time, CPI, at its option, may redeem the 8% Notes, in whole or in part, at the redemption prices (expressed as percentages of principal amount) thereof, together with accrued and unpaid interest thereon, if any, to the redemption date, if redeemed during the 12-month period beginning on February 1 of any given year. For year 2010 and thereafter, the optional redemption price is 100% of the principal amount of the 8% Notes.

        Upon a change of control, CPI may be required to purchase all or any part of the 8% Notes for a cash price equal to 101% of the principal amount, plus accrued and unpaid interest thereon, if any, to the date of purchase.

        The indenture governing the 8% Notes contains a number of covenants that, among other things, restrict, subject to certain exceptions, the ability of CPI and its restricted subsidiaries (as defined in the indenture governing the 8% Notes) to incur additional indebtedness, sell assets, consolidate or merge with or into other companies, pay dividends or repurchase or redeem capital stock or subordinated indebtedness, make certain investments, issue capital stock of their subsidiaries, incur liens and enter into certain types of transactions with their affiliates.

        Events of default under the indenture governing the 8% Notes include: failure to make payments on the 8% Notes when due; failure to comply with covenants in the indenture governing the 8% Notes; a default under certain other indebtedness of CPI or any of its restricted subsidiaries that is caused by a failure to make payments on such indebtedness or that results in the acceleration of the maturity of such indebtedness; the existence of certain final judgments or orders against CPI or any of the restricted subsidiaries; and the occurrence of certain insolvency or bankruptcy events.

        Floating Rate Senior Notes due 2015 of CPI International:    As of October 1, 2010, $12.0 million of aggregate principal amount remained outstanding under CPI International's Floating Rate Senior Notes due 2015 (the "FR Notes"). CPI International redeemed none of its outstanding FR Notes during fiscal years 2010 and 2009. During fiscal year 2008, CPI International redeemed $10.0 million aggregate principal amount of the FR Notes. The FR Notes were originally issued at a 1% discount and have no sinking fund requirements.

        The FR Notes require interest payments at an annual interest rate, reset at the beginning of each semi-annual period, equal to the then six-month LIBOR plus 5.75%, payable semiannually on February 1 and August 1 of each year. The interest rate on the semi-annual interest payment due February 1, 2011 is 6.43% per annum. The FR Notes will mature on February 1, 2015.

        The FR Notes are general unsecured obligations of CPI International. The FR Notes are not guaranteed by any of CPI International's subsidiaries but are structurally subordinated to all existing and future indebtedness and other liabilities of CPI International's subsidiaries. The FR Notes are

F-30

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

5. Long-term debt (Continued)

senior in right of payment to CPI International's existing and future indebtedness that is expressly subordinated to the FR Notes.

        Because CPI International is a holding company with no operations of its own, CPI International relies on distributions from Communications & Power Industries to satisfy its obligations under the FR Notes. The Senior Credit Facilities and the indenture governing the 8% Notes restrict CPI's ability to make distributions to CPI International. The Senior Credit Facilities prohibit CPI from making distributions to CPI International unless there is no default under the Senior Credit Facilities and CPI satisfies a senior secured leverage ratio of 3.75:1 and, in the case of distributions to pay amounts other than interest on the FR Notes, the amount of the distribution and all prior such distributions do not exceed a specified amount. The indenture governing the 8% Notes prohibits CPI from making distributions to CPI International unless, among other things, there is no default under the indenture and the amount of the proposed dividend plus all previous Restricted Payments (as defined in the indenture governing the 8% Notes) does not exceed a specified amount.

        At any time or from time to time, CPI International, at its option, may redeem the FR Notes, in whole or in part, at the redemption prices (expressed as percentages of principal amount) thereof, together with accrued and unpaid interest thereon, if any, to the redemption date, if redeemed during the 12-month period beginning on February 1 of any given year. For year 2010 and thereafter, the optional redemption price is 100% of the principal amount of the FR Notes.

        Upon a change of control, as defined in the indenture governing the FR Notes, CPI International may be required to purchase all or any part of the outstanding FR Notes for a cash price equal to 101% of the principal amount, plus accrued and unpaid interest thereon, if any, to the date of purchase.

        The indenture governing the FR Notes contains certain covenants that, among other things, limit the ability of CPI International and its restricted subsidiaries (as defined in the indenture governing the FR Notes) to incur additional indebtedness, sell assets, consolidate or merge with or into other companies, pay dividends or repurchase or redeem capital stock or subordinated indebtedness, make certain investments, issue capital stock of their subsidiaries, incur liens and enter into certain types of transactions with their affiliates.

        Events of default under the indenture governing the FR Notes include: failure to make payments on the FR Notes when due; failure to comply with covenants in the indenture governing the FR Notes; a default under certain other indebtedness of CPI International or any of its restricted subsidiaries that is caused by a failure to make payments on such indebtedness or that results in the acceleration of the maturity of such indebtedness; the existence of certain final judgments or orders against CPI International or any of the restricted subsidiaries; and the occurrence of certain insolvency or bankruptcy events.

F-31

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

5. Long-term debt (Continued)

        Debt Maturities:    As of October 1, 2010, maturities on long-term debt were as follows:

Fiscal year	Term loan		8% Senior subordinated notes		Floating rate senior notes		Total
2011	$	66,000	$	—	$	—	$	66,000
2012		—		117,000		—		117,000
2013		—		—		—		—
2014		—		—		—		—
2015		—		—		12,000		12,000
	$	66,000	$	117,000	$	12,000	$	195,000

        The above table assumes (1) that the respective debt instruments will be outstanding until their scheduled maturity dates, except for the Term Loan under the Senior Credit Facilities, which is assumed to mature on the earlier date of August 1, 2011 as described above under "Senior Credit Facilities," and (2) a debt level based on mandatory repayments according to the contractual amortization schedule. The above table also excludes any optional prepayments.

        As of October 1, 2010, the Company was in compliance with the covenants under the indentures governing the 8% Notes and FR Notes and the agreements governing the Senior Credit Facilities.

        (Gain) loss on debt extinguishment:    The repurchase of $8.0 million of the 8% Notes during fiscal year 2009, as discussed above, resulted in a gain on debt extinguishment of $0.2 million which was comprised of a discount of $0.4 million, partially offset by a non-cash write-off of $0.2 million deferred debt issue costs. The redemption of $10.0 million of the FR Notes in fiscal year 2008 resulted in a loss on debt extinguishment of approximately $0.6 million, including non-cash write-offs of $0.4 million of unamortized debt issue costs and issue discount costs and $0.2 million in cash payments primarily for call premiums.

        Interest rate swap agreements:    See Note 7 for information on the interest rate swap agreements entered into by the Company to hedge the interest rate exposure associated with the Term Loan.

6. Employee benefit plans

        Retirement Plans:    The Company provides a qualified 401(k) investment plan covering substantially all of its domestic employees and a pension contribution plan covering substantially all of its Canadian employees. Discontinued as of end of fiscal year 2008, a profit sharing plan had also been provided by the Company, covering substantially all of its Econco employees. These plans provided for the Company to contribute an amount based on a percentage of each participant's base pay. The Company also has a Non-Qualified Deferred Compensation Plan (the "Non-Qualified Plan") that allows a select group of management and highly compensated employees to defer a portion of their compensation. The Non-Qualified Plan liability recorded by the Company amounted to approximately $0.4 million and $0.3 million as of October 1, 2010 and October 2, 2009, respectively. For all of the Company's current retirement plans, all participant contributions and Company matching contributions are 100% vested. Total CPI contributions to these retirement plans were $2.7 million, $2.6 million and

F-32

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

6. Employee benefit plans (Continued)

$3.7 million for fiscal years 2010, 2009 and 2008, respectively. The Company's contributions were lower in fiscal years 2010 and 2009 as the Company reduced its contributions to the retirement plans as a cost savings measure, which was restored to prior levels during fiscal year 2010.

        Defined Benefit Pension Plan:    The Company maintains a defined benefit pension plan for its Chief Executive Officer ("CEO"). The plan's benefits are based on the CEO's compensation earnings and are limited by statutory requirements of the Canadian Income Tax Act. All costs of the plan are borne by the Company.

        At October 1, 2010 and October 2, 2009, the Company recorded a liability of $0.4 million and $0.3 million, respectively, which approximates the excess of the projected benefit obligation over plan assets of $0.9 million and $0.8 million, respectively. Additionally, the Company recorded an unrealized loss of $0.3 million, net of tax of $0.1 million, as of October 1, 2010; an unrealized loss of $0.2 million, net of tax of $0.1 million, as of October 2, 2009; and an unrealized loss of $0.2 million, net of tax of $0.1 million, as of October 3, 2008 to accumulated other comprehensive (loss) income in the consolidated balance sheets.

        The Company's defined benefit pension plan is managed by an insurance company consistent with regulations or market practice in Canada, where the plan assets are invested. Net pension expense was not material for any period. Contributions to the plan are not expected to be significant to the financial position of the Company.

7. Derivative instruments and hedging activities

        Foreign Exchange Forward Contracts:    Although the majority of the Company's revenue and expense activities are transacted in U.S. dollars, the Company does transact business in foreign countries. The Company's primary foreign currency cash flows are in Canada and several European countries. In an effort to reduce its foreign currency exposure to Canadian dollar denominated expenses, the Company enters into Canadian dollar forward contracts to hedge the Canadian dollar denominated costs for its manufacturing operation in Canada. The Company does not engage in currency speculation.

        The Company's Canadian dollar forward contracts in effect as of October 1, 2010 have durations of 7 to 11 months. These contracts are designated as cash flow hedges and are considered highly effective, as defined by FASB ASC 815. Unrealized gains and losses from foreign exchange forward contracts are included in accumulated other comprehensive (loss) income in the consolidated balance sheets. At October 1, 2010, the unrealized gain, net of tax of $0.3 million, was $0.7 million. The Company anticipates recognizing the entire unrealized gain or loss in operating earnings within the next four fiscal quarters. Changes in the fair value of foreign currency forward contracts due to changes in time value are excluded from the assessment of effectiveness and are immediately recognized in general and administrative expenses in the consolidated statements of income. The time value was not material for fiscal years 2010, 2009 and 2008. If the transaction being hedged fails to occur, or if a portion of any derivative is ineffective, then the Company immediately recognizes the gain or loss on the associated financial instrument in general and administrative expenses in the consolidated statements of income. The gain recognized in general and administrative expenses due to hedge ineffectiveness for

F-33

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

7. Derivative instruments and hedging activities (Continued)

fiscal year 2010 was $0.1 million. No ineffective amounts were recognized due to anticipated transactions failing to occur in fiscal years 2009 and 2008.

        As of October 1, 2010, the Company had entered into Canadian dollar forward contracts for approximately $14.1 million (Canadian dollars), or approximately 39% of estimated Canadian dollar denominated expenses for October 2010 through June 2011, at an average rate of approximately 0.94 U.S. dollars to Canadian dollars.

        Interest Rate Contracts:    The Company also uses derivative instruments in order to manage interest costs and risk associated with its long-term debt. During fiscal year 2007, the Company entered into an interest rate swap contract (the "2007 Swap") to receive three-month USD-LIBOR-BBA (British Bankers' Association) interest and pay 4.77% fixed rate interest. Net interest positions are settled quarterly. The Company has structured the 2007 Swap with decreasing notional amounts such that it is less than the balance of its Term Loan under the Senior Credit Facilities discussed in Note 5. The notional value of the 2007 Swap was $30.0 million at October 1, 2010 and represented approximately 45% of the aggregate Term Loan balance. The Swap agreement is effective through June 30, 2011. Under the provisions of ASC 815, this arrangement was initially designated and qualified as an effective cash flow hedge of interest rate risk related to the term loan, which permitted recording the fair value of the 2007 Swap and corresponding unrealized gain or loss to accumulated other comprehensive (loss) income in the consolidated balance sheets. At October 1, 2010, the unrealized loss, net of tax of $0.3 million, was $0.5 million. The interest rate swap gain or loss is included in the assessment of hedge effectiveness. Gains and losses representing hedge ineffectiveness are immediately recognized in interest expense, net, in the consolidated statements of income.

        See Note 4, Financial Instruments, for further information regarding the Company's derivative instruments.

        The following table summarizes the fair value of derivative instruments designated as cash flow hedges at October 1, 2010 and October 2, 2009:

		Asset derivatives					Liability derivatives
			Fair value					Fair value
		Balance sheet location	October 1, 2010		October 2, 2009		Balance sheet location	October 1, 2010		October 2, 2009
Derivatives designated as hedging instruments
	Interest rate contracts						Accrued expenses	$	816	$	1,766
	Interest rate contracts						Other long-term liabilities		—		557
	Forward contracts	Prepaid and other current assets	$	437	$	3,467
Total derivatives designated as hedging instruments			$	437	$	3,467		$	816	$	2,323

F-34

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

7. Derivative instruments and hedging activities (Continued)

        As of October 1, 2010 and October 2, 2009, all of the Company's derivative instruments were classified as hedging instruments under ASC 815.

        The following table summarizes the effect of derivative instruments on the consolidated statements of income and comprehensive income for fiscal years 2010 and 2009:

								Amount of (loss) gain reclassified from accumulated OCI into income (effective portion)							Amount of (loss) gain recognized in income on derivative (ineffective and excluded portion)
	Amount of (loss) gain recognized in OCI on derivative (effective portion)
							Location of (loss) gain reclassified from accumulated OCI into income (effective portion)							Location of (loss) gain recognized in income on derivative (ineffective and excluded portion)
	Year ended							Year ended							Year ended
Derivatives in cash flow hedging relationships	October 1, 2010			October 2, 2009				October 1, 2010			October 2, 2009				October 1, 2010			October 2, 2009
Interest rate contracts	$	(355	)	$	(2,173	)	Interest expense, net	$	(1,862	)	$	(1,797	)	Interest expense, net	$	(36	)	$	(51	)
Forward contracts		1,236			(315	)	Cost of sales		3,150			(3,963	)	General and administrative(a)		45			(321	)
							Research and development		365			(192	)
							Selling and marketing		158			(106	)
							General and administrative		219			(317	)
Total	$	881		$	(2,488	)		$	2,030		$	(6,375	)		$	9		$	(372	)

(a)

The amount of gain recognized in income during fiscal year 2010 represents a $62 gain related to the ineffective portion of the hedging relationships, net of $17 loss related to the amount excluded from the assessment of hedge effectiveness. The amount of loss recognized in income during fiscal year 2009 represents a $323 loss related to the amount excluded from the assessment of hedge effectiveness, net of a $2 gain related to the ineffective portion of the hedging relationships.

        As a result of the use of derivative instruments, the Company is exposed to the risk that counterparties to derivative contracts will fail to meet their contractual obligations. The Company does not hold collateral or other security from its counterparties supporting its derivative instruments. To mitigate the counterparty credit risk, the Company has a policy of only entering into contracts with carefully selected major financial institutions based upon their credit ratings and other factors. The Company regularly reviews its credit exposure balances as well as the creditworthiness of its counterparties.

        When the Company's derivatives are in a net asset position, such as the case with the Company's forward foreign exchange contract derivatives at October 1, 2010, the Company is exposed to credit loss from nonperformance by the counterparty. If the counterparty fails to perform, credit risk with such counterparty is equal to the extent of the fair value gain in the derivative. At October 1, 2010, the Company's interest rate contract derivatives were in a net liability position, and the Company, therefore, was not exposed to the interest rate contract counterparty credit risk.

F-35

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

8. Commitments and contingencies

        Leases:    The Company is committed to minimum rentals under non-cancelable operating lease agreements, primarily for land and facility space, that expire on various dates through 2050. Certain of the leases provide for escalating lease payments. Future minimum lease payments for all non-cancelable operating lease agreements at October 1, 2010 were as follows:

Fiscal year	Operating leases
2011	$	1,409
2012		1,128
2013		699
2014		422
2015		219
Thereafter		2,443
	$	6,320

        Real estate taxes, insurance, and maintenance are also obligations of the Company. Rental expense under non-cancelable operating leases amounted to $2.5 million for each of fiscal years 2010, 2009 and 2008. Assets subject to capital leases at October 1, 2010 and October 2, 2009 were not material.

        Guarantees:    The Company has restricted cash of $1.8 million and $1.6 million as of October 1, 2010 and October 2, 2009, respectively, consisting primarily of bank guarantees from customer advance payments to the Company's international subsidiaries. The bank guarantees become unrestricted cash when performance under the sales or supply contract is complete.

        Purchase commitments:    As of October 1, 2010, the Company had the following known purchase commitments, which include primarily future purchases for inventory-related items under various purchase arrangements as well as other obligations in the ordinary course of business that the Company cannot cancel or where it would be required to pay a termination fee in the event of cancellation:

Fiscal year	Purchase contracts
2011	$	28,519
2012		326
2013		5
2014		—
2015		—
	$	28,850

        Indemnification:    As permitted under Delaware law, the Company has agreements whereby the Company indemnifies its officers, directors and certain employees for certain events or occurrences while the employee, officer or director is, or was serving, at the Company's request in such capacity. The term of the indemnification period is for the officer's or director's lifetime. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited; however, the Company has Director and Officer insurance policies that limit its exposure and may enable it to recover a portion of any future amounts paid.

F-36

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

8. Commitments and contingencies (Continued)

        The Company has entered into other standard indemnification agreements in its ordinary course of business. Pursuant to these agreements, the Company agrees to indemnify, defend, hold harmless and to reimburse the indemnified party for losses suffered or incurred by the indemnified party, generally the Company's business partners or customers, in connection with any patent, copyright or other intellectual property infringement claim by any third-party with respect to the Company's products. The term of these indemnification agreements is generally perpetual after execution of the agreement. The maximum potential amount of future payments the Company could be required to make under these indemnification agreements is unlimited. Management believes that the likelihood of loss under these agreements is remote.

        Employment Agreements:    The Company has entered into employment agreements with certain members of the executive management, which include provisions for the continued payment of salary, benefits and a pro-rata portion of an annual bonus for periods ranging from 12 months to 30 months upon certain terminations of employment.

        Contingencies:    From time to time, the Company may be subject to claims that arise in the ordinary course of business. Except as noted below, in the opinion of management, all such matters involve amounts that would not have a material adverse effect on the Company's consolidated financial position if unfavorably resolved.

        On July 1, 2010, a putative stockholder class action complaint was filed against the Company, the members of the Company's board of directors, and Comtech Telecommunications Corporation ("Comtech"). The lawsuit concerns the proposed merger between the Company and Comtech, and generally asserts claims alleging, among other things, that each member of the Company's board of directors breached his fiduciary duties by agreeing to the terms of the previously proposed merger and by failing to provide stockholders with allegedly material information related to the proposed merger, and that Comtech aided and abetted the breaches of fiduciary duty allegedly committed by the members of the Company's board of directors. The lawsuit seeks, among other things, class action certification and monetary relief. On July 28, 2010, the plaintiff filed an amended complaint, making generally the same claims against the same defendants, and seeking the same relief. In addition, the amended complaint generally alleges that the consideration that would have been paid to the Company's stockholders under the terms of the proposed merger was inadequate. On September 7, 2010, the Company terminated the Comtech sale agreement. On November 24, 2010, the Company entered in an agreement and plan of merger with Catalyst Holdings, Inc. and Catalyst Acquisition, Inc. which are affiliates of The Veritas Capital Fund IV, L.P. ("Veritas"). On December 9, 2010, the plaintiff filed a motion for leave to file a second amended complaint which, among other things, amends its breach of fiduciary duty claims to allege that the Company and its board of directors, as well as Cypress Associates II LLC, breached fiduciary duties in connection with the proposed merger of the Company with a Veritas affiliate, adds a claim for attorneys' fees for the benefit the plaintiff purportedly obtained as a result of its previous prosecution of this action, and adds claims against Veritas and its affiliates for aiding and abetting the aforementioned breaches of fiduciary duties. The action continues to seek, among other things, class action certification and monetary relief. The Company believes all claims asserted in the lawsuit to be without merit.

F-37

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

8. Commitments and contingencies (Continued)

        During fiscal year 2009, the Company received a notice from a customer purporting to terminate a sales contract due to alleged nonperformance. In April and June 2010, the Company received notices from the customer claiming additional cost incurred due to the alleged nonperformance. The customer has filed a claim for damages of approximately $2.1 million and the Company has filed a counterclaim for damages of approximately $0.9 million. The Company plans to contest this matter vigorously. At this time, the Company believes that any loss or gain with respect to this matter will not have a material effect on the Company's consolidated results of operations and cash flows.

        All legal costs are expensed as incurred.

9. Stockholders' equity

        Common and Preferred Stock:    The Company has 90,000,000 authorized shares of Common Stock, par value $0.01 per share, and 10,000,000 authorized shares of Preferred Stock, par value $0.01 per share. The holder of each share of Common Stock has the right to one vote. The board of directors has the authority to issue the undesignated Preferred Stock in one or more series and to fix the rights, preferences, privileges and restrictions thereof. At October 1, 2010 and October 2, 2009, there were no shares of Preferred Stock outstanding.

        Treasury Stock:    Pursuant to its May 2008 publicly announced share repurchase program, the Company repurchased 206,243 shares at an average per share price of $13.54, plus average brokerage commissions of $0.04 per share, for an aggregate cost of $2.8 million during fiscal year 2008. Repurchased shares have been recorded as treasury shares and will be held until the Company's board of directors designates that these shares be retired or used for other purposes.

        Stock-Based Compensation Plans:    The Company has two active stock plans: the 2006 Equity and Performance Incentive Plan (the "2006 Plan") and the 2006 Employee Stock Purchase Plan (the "2006 ESPP").

        2006 Plan:    The 2006 Plan provides for an aggregate of up to 2,800,000 shares of CPI International's common stock to be available for awards, plus the number of shares subject to awards granted under the 2004 Stock Incentive Plan (the "2004 Plan") and the 2000 Stock Option Plan (the "2000 Plan") that are forfeited, expire or are cancelled after the effective date of the 2006 Plan. All of the Company's employees (including officers), directors, and consultants are eligible for awards under the 2006 Plan. The 2006 Plan is administered by the Compensation Committee of the Company's board of directors ("Compensation Committee") and awards may consist of options, stock appreciation rights, restricted stock, other stock unit awards, performance awards, dividend equivalents or any combination of the foregoing. The exercise price for stock options generally cannot be less than 100% of the fair market value of the shares on the date of grant. Effective February 2009, future share-based awards (other than option and stock appreciation right awards) made under the 2006 Plan will count as two shares for purposes of determining whether the cap on the total number of shares issuable under the 2006 Plan has been exceeded. Approximately 1,285,000 shares were available for grant as of October 1, 2010.

F-38

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

9. Stockholders' equity (Continued)

        2006 ESPP:    The 2006 ESPP permits eligible employees to purchase common stock at a discounted price. An aggregate of 760,000 shares of common stock is reserved for issuance under this plan. The stock purchase plan is administered by the Compensation Committee. Employees participating in the plan may purchase stock for their accounts according to a price formula set by the Compensation Committee, as administrator, before the applicable offering period, which cannot exceed 24 months. The price per share will equal either a fixed percentage (which may not be lower than 85%) of the fair market value of a share of common stock on the last day of the purchase period in the offering, or the lower of (1) a fixed percentage (not to be less than 85%) of the fair market value of a share of common stock on the date of commencement of participation in the offering and (2) a fixed percentage (not to be less than 85%) of the fair market value of a share of common stock on the date of purchase as determined by the Compensation Committee. Under the 2006 ESPP, approximately 477,000 shares of common stock were available for issuance as of October 1, 2010.

        The Company has two other stock plans, the 2004 Plan and the 2000 Plan mentioned above, that were terminated as to future grants. Although these plans have been terminated as to future grants, they continue to govern all awards granted under them.

        Stock Options:    Options outstanding that have vested and are expected to vest as of October 1, 2010 are as follows:

	Number of shares		Weighted- average exercise price		Weighted- average remaining contractual term (years)		Aggregate intrinsic value
Vested		2,915,483	$	5.61		3.8	$	25,930
Expected to vest		430,539		13.29		7.5		871
Total		3,346,022		6.60		4.2	$	26,801

        Options outstanding that are expected to vest are net of estimated future option forfeitures in accordance with the provisions of FASB ASC 718, "Compensation—Stock Compensation."

F-39

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

9. Stockholders' equity (Continued)

        Additional information with respect to stock option activity is as follows:

	Outstanding options									Exercisable options
	Number of shares			Weighted- average exercise price		Weighted- average remaining contractual term (years)		Aggregate intrinsic value		Number of shares		Weighted- average exercise price		Weighted- average remaining contractual term (years)		Aggregate intrinsic value
Balance at September 28, 2007		3,171,081		$	5.61		6.58	$	42,513		2,259,528	$	3.00		5.98	$	36,184
Granted		208,750			16.79
Exercised		(8,906	)		4.32
Forfeited or cancelled		(21,631	)		17.75
Balance at October 3, 2008		3,349,294		$	6.23		5.77	$	24,363		2,556,762	$	3.83		5.16	$	23,052
Granted		108,000			10.00
Exercised		(57,382	)		1.44
Forfeited or cancelled		(17,149	)		16.85
Balance at October 2, 2009		3,382,763		$	6.38		4.95	$	20,362		2,845,996	$	4.73		4.43	$	20,227
Granted		108,000			9.66
Exercised		(126,446	)		1.83
Forfeited or cancelled		(17,125	)		16.42
Balance at October 1, 2010		3,347,192		$	6.60		4.24	$	26,801		2,915,483	$	5.61		3.76	$	25,930

        The aggregate intrinsic value in the preceding table represents the total pre-tax intrinsic value of in-the-money options that would have been received by the option holders had all option holders exercised their options at the Company's closing stock price on the date indicated. As of October 1, 2010, approximately 2.4 million exercisable options were in-the-money.

        During fiscal years 2010, 2009 and 2008, cash received from option exercises was approximately $0.2 million, $0.1 million and $38,000, and the total intrinsic value of options exercised was approximately $1.5 million, $0.4 million and $0.1 million, respectively. As of October 1, 2010, there was approximately $1.5 million of total unrecognized compensation costs related to nonvested stock options, which is expected to be recognized over a weighted-average vesting period of 1.3 years.

F-40

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

9. Stockholders' equity (Continued)

        Outstanding and exercisable options presented by exercise price at October 1, 2010 are as follows:

	Options outstanding				Exercisable options
Exercise price	Number of options outstanding		Weighted-average remaining contractual term (years)		Number of options exercisable		Weighted-average remaining contractual term (years)
$0.20		618,364		2.4		618,364		2.4
$0.74		23,153		1.1		23,153		1.1
$1.08		8,000		3.3		8,000		3.3
$4.32		1,666,531		3.5		1,666,531		3.5
$6.61		49,032		4.0		49,032		4.0
$6.98		21,412		4.5		21,412		4.5
$9.66		108,000		9.2		—		—
$10.00		108,000		8.2		13,500		8.2
$14.22		270,375		6.2		202,500		6.2
$16.79		192,325		7.2		96,741		7.2
$16.94		1,500		7.2		750		7.2
$17.09		6,000		6.4		6,000		6.4
$18.00		263,500		5.6		199,500		5.6
$19.53		7,000		7.0		7,000		7.0
$19.80		4,000		6.6		3,000		6.6
Total		3,347,192		4.2		2,915,483		3.8

        Stock Purchase Plan:    Employees purchased approximately 49,000 shares, 111,000 shares, and 72,000 shares in fiscal years 2010, 2009 and 2008, respectively, for $0.6 million, $1.0 million and $0.9 million, respectively, under the 2006 ESPP. As of October 1, 2010, there were no unrecognized compensation costs related to rights to acquire stock under the 2006 ESPP.

        Restricted Stock and Restricted Stock Units:    As of October 1, 2010, October 2, 2009 and October 3, 2008, there were outstanding 310,341, 218,298 and 117,154, respectively, of nonvested restricted stock and restricted stock units, in each case, granted to directors and employees. The restricted stock and restricted stock units generally vest over periods of one to four years. Upon vesting, each restricted stock unit will automatically convert into one share of common stock of CPI International.

F-41

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

9. Stockholders' equity (Continued)

        Additional information with respect to outstanding restricted stock and restricted stock unit activity is as follows:

	Number of shares			Weighted-average grant-date fair value per share		Aggregate fair value*
Nonvested at September 28, 2007		11,466		$	17.44
Granted		114,461		$	15.22
Vested		(5,848	)	$	17.60	$	62
Forfeited		(2,925	)	$	16.79
Nonvested at October 3, 2008		117,154		$	15.28
Granted		142,721		$	8.87
Vested		(36,377	)	$	14.81	$	233
Forfeited		(5,200	)	$	10.85
Nonvested at October 2, 2009		218,298		$	11.27
Granted		163,307		$	10.04
Vested		(65,914	)	$	11.87	$	778
Forfeited		(5,350	)	$	10.44
Nonvested at October 1, 2010		310,341		$	10.51

*

Based on the value of the Company's stock on the date that the restricted stock units vest.

        During the first quarter of fiscal year 2010, the Company granted 104,800 restricted stock units with time vesting criteria to certain of its non-executive employees and 36,000 restricted stock units with performance vesting criteria to its officers.

        During the second quarter of fiscal year 2010, the Company granted certain members of its board of directors a total of 22,507 shares of restricted stock which will vest within the following three years.

        Aggregate intrinsic value of the nonvested restricted stock and restricted stock unit awards at October 1, 2010 and October 2, 2009 was $4.4 million and $2.5 million, respectively. As of October 1, 2010, there was $2.3 million of unrecognized compensation costs related to restricted stock and restricted stock unit awards. The unrecognized compensation cost is expected to be recognized over a weighted average period of 1.7 years.

        The Company settles stock option exercises and restricted stock units with newly issued common shares.

Valuation and Expense Information

        The fair value of the Company's time-based option awards is estimated on the date of grant using the Black-Scholes model. The fair value of each market performance-based (or combination of market performance- and time-based) option, restricted stock and restricted stock unit award is estimated on the date of grant using the Monte Carlo simulation technique in a risk-neutral framework.

F-42

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

9. Stockholders' equity (Continued)

        The Black-Scholes and the Monte Carlo simulation valuation models were developed for use in estimating the fair value of traded options that have no vesting restrictions and are fully transferable and require the input of subjective assumptions, including the expected stock price volatility and estimated option life. The Company currently does not intend to pay dividends and, accordingly, no dividends have been assumed in its Black-Scholes calculation and Monte Carlo simulation. Since the Company's common stock has not been publicly traded for a sufficient time period, the expected volatility is based on a blend of expected volatilities of similar companies and that of the Company based on its available historical data. The risk-free rates are based on the U.S. Treasury yield in effect at the time of the grant. Since the Company's historical data is limited, the expected term of time-based options granted is based on integrating historical data with the simplified method for plain vanilla options in accordance with ASC 718. The integration of historical data with the simplified method is done by using the actual life for options that have been settled, and a uniform distribution assumption for the options still outstanding. The Company will continue to use historical data with the simplified method until it has enough historical experience to provide a reasonable estimate of expected term.

        Stock Options.    Assumptions used in the Black-Scholes model to estimate the fair value of time-based option grants are presented below.

	Year ended
	October 1, 2010			October 2, 2009			October 3, 2008
Expected term (in years)		7.79			—			6.25
Expected volatility		60.50	%		—	%		41.20	%
Dividend yield		0.00	%		—	%		0.0	%
Risk-free rate		3.0	%		—	%		3.8	%

        There were no time-based options granted during fiscal year 2009.

        Assumptions used in the Monte Carlo simulation model to estimate the fair value of time- and market performance-based options first granted during fiscal year 2009 are presented below.

Contractual term (in years)	10.00
Expected volatility	51.50	%
Risk-free rate	3.5	%
Dividend yield	0	%

        There were no time-based and market performance-based options granted during fiscal years 2010 and 2008.

        The weighted-average grant-date fair value of all the options granted during fiscal years 2010, 2009 and 2008 was $6.25, $5.61 and $7.83 per share, respectively.

        Stock Purchase Plan.    Based on the 15% discount received by the employees, the weighted-average fair value of shares issued under the 2006 ESPP was $2.08, $1.51 and $2.08 per share during fiscal years 2010, 2009 and 2008, respectively.

F-43

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

9. Stockholders' equity (Continued)

        Restricted Stock and Restricted Stock Units.    The fair value of each time-based restricted stock and restricted stock unit award and of each performance-based restricted stock unit award is calculated using the market price of the Company's common stock on the date of grant. The fair value of each performance-based restricted stock unit award assumes that the relevant performance criteria will be met and the target payout level will be achieved. Compensation cost is adjusted for subsequent changes in the outcome of performance-related conditions until the award vests.

        Assumptions used in the Monte Carlo simulation model to estimate the fair value of time- and market performance-based restricted stock and restricted stock units first granted during fiscal year 2009 are presented below.

Expected volatility	51.50	%
Risk-free rate	3.5	%
Dividend yield	0	%

        There were no time- and market performance-based restricted stock and restricted stock units granted during fiscal years 2010 and 2008.

        The weighted-average estimated fair value of restricted stock and restricted stock units granted was $10.04, $8.87 and $15.22 per share during fiscal years 2010, 2009 and 2008, respectively.

        As stock-based compensation expense recognized in the consolidated statement of income for all fiscal years presented is based on awards ultimately expected to vest, it has been reduced for estimated forfeitures. FASB ASC 718 requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates.

F-44

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

9. Stockholders' equity (Continued)

        The following table summarizes stock-based compensation expense for fiscal years 2010, 2009, and 2008, which was allocated as follows:

		Year ended
		October 1, 2010		October 2, 2009		October 3, 2008
Share-based compensation cost recognized in the statement of income by caption:
	Cost of sales	$	575	$	506	$	425
	Research and development		200		174		153
	Selling and marketing		284		262		229
	General and administrative		1,981		1,737		1,328
		$	3,040	$	2,679	$	2,135
Share-based compensation cost capitalized in inventory		$	586	$	516	$	453
Share-based compensation cost remaining in inventory at end of period		$	97	$	86	$	76
Share-based compensation expense by type of award:
	Stock options	$	1,831	$	1,746	$	1,544
	Restricted stock and restricted stock units		1,105		804		438
	Stock purchase plan		104		129		153
		$	3,040	$	2,679	$	2,135

        The tax benefit realized from option exercises and restricted stock vesting totaled approximately $0.8 million, $0.2 million and $50,000 during fiscal years 2010, 2009 and 2008, respectively.

10. Termination of merger agreement with Comtech

        On September 7, 2010, the Company and Comtech entered into a Termination and Release Agreement, by which the Company and Comtech terminated a previously announced merger agreement, dated May 8, 2010. The termination was by mutual agreement of the companies and was unanimously approved by the Company's board of directors and the board of directors of Comtech. As part of the termination, the Company has paid Comtech a termination fee of $15.0 million. In addition, the Company has incurred during fiscal year 2010 transaction expenses relating to the proposed merger in the amount of $4.9 million. Such transaction expenses comprised fees for investment bankers, attorneys and other professional services rendered in connection with the proposed merger, as well as with the related stockholder class lawsuit described in Note 8 above. The total expenses of $19.9 million is presented as "strategic alternative transaction expenses" in the consolidated statement of income for fiscal year 2010.

F-45

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

11. Income taxes

        Income (loss) before income taxes consisted of the following:

	Year ended
	October 1, 2010			October 2, 2009		October 3, 2008
U.S.	$	(2,914	)	$	15,206	$	20,405
Foreign		15,275			8,042		10,848
	$	12,361		$	23,248	$	31,253

        Income tax expense (benefit) consisted of the following:

		Year ended
		October 1, 2010			October 2, 2009			October 3, 2008
Current
	Federal	$	5,879		$	1,263		$	6,904
	State		857			1,083			1,980
	Foreign		3,751			(1,201	)		3,035
			10,487			1,145			11,919
Deferred
	Federal		(4,230	)		(99	)		(934	)
	State		(268	)		(738	)		(208	)
	Foreign		(367	)		(526	)		27
			(4,865	)		(1,363	)		(1,115	)
Income tax expense		$	5,622		$	(218	)	$	10,804

F-46

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

11. Income taxes (Continued)

        The differences between the effective income tax rate and the federal statutory income tax rate were as follows:

		Year ended
		October 1, 2010			October 2, 2009			October 3, 2008
Statutory federal income tax rate			35.0	%		35.0	%		35.0	%
Domestic manufacturing deduction			(3.2	)		(1.7	)		(1.5	)
Foreign tax rate differential			(10.0	)		(2.8	)		(2.3	)
State taxes			2.8			4.3			3.7
Research and development credit			(3.1	)		(1.3	)		—
Tax contingency reserve accrual (reversal)			23.9			(14.6	)		0.5
Correction of error from prior year			—			(7.2	)		(1.4	)
New state legislation			—			(2.9	)		—
Tax treaty benefits			—			(12.1	)		—
Other differences			0.1			2.4			0.6
	Effective tax rate		45.5	%		(0.9	)%		34.6	%

        The effective tax rate for fiscal year 2010 was 45.5% and diverged from the federal and state statutory rate primarily due to a $3.1 million discrete tax expense on an uncertain tax position for strategic alternative transaction expenses.

F-47

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

11. Income taxes (Continued)

        Deferred income taxes reflect the net tax effects of temporary differences between the basis of assets and liabilities for financial reporting and income tax purposes. The Company's deferred tax assets (liabilities) were as follows:

				October 1, 2010			October 2, 2009
Deferred tax assets:
	Inventory and other reserves			$	6,699		$	6,539
	Accrued vacation				1,758			1,607
	Deferred compensation and other accruals				6,448			5,338
	Tax credit carryforward				2,241			—
	Other				1,695			2,001
		Gross deferred tax assets			18,841			15,485
		Valuation allowance			—			—
			Total deferred tax assets	$	18,841		$	15,485
Deferred tax liabilities:
	Accelerated depreciation			$	(6,084	)	$	(7,122	)
	Acquisition-related intangibles				(23,022	)		(23,659	)
	Other comprehensive income				—			(432	)
	Unremitted foreign earnings				(92	)		(63	)
	Other long-term deferred tax liabilities				(320	)		(283	)
			Total deferred tax liabilities	$	(29,518	)	$	(31,559	)
Net deferred tax liabilities				$	(10,677	)	$	(16,074	)

        Realization of the Company's net deferred tax assets is based upon the weight of available evidence, including such factors as recent earnings history and expected future taxable income. The Company believes it is more likely than not that such assets will be realized; however, ultimate realization could be negatively impacted by market conditions and other variables not known or anticipated at this time. As of October 1, 2010, the Company had federal tax credit carryforwards of $2.2 million. If not utilized, the federal tax credit carryforwards will begin to expire in 2019.

        The net deferred tax assets (liabilities) were classified in the consolidated balance sheet as follows:

	October 2, 2009			October 1, 2010
Deferred tax assets (Current asset)	$	8,652		$	11,030
Deferred income taxes (Long-term liability)		(24,726	)		(21,707	)
Net deferred tax liabilities	$	(16,074	)	$	(10,677	)

        The Company has not provided deferred taxes on approximately $21.8 million of the Company's undistributed earnings in its Canadian operations which are intended to be permanently reinvested. The

F-48

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

11. Income taxes (Continued)

amount of unrecognized deferred tax liability related to this temporary difference is estimated to be approximately $2.7 million.

        The total unrecognized tax benefits, excluding any related interest accrual, are reported in the consolidated balance sheet in the following accounts:

	October 1, 2010		October 2, 2009
Income taxes payable	$	2,744	$	2,713
Other long-term liabilities		3,841		615
	$	6,585	$	3,328

        Of the total unrecognized tax benefit balance, $6.3 million and $2.4 million would reduce the effective tax rate if recognized as of October 1, 2010 and October 2, 2009, respectively. The Company believes that it is reasonably possible that, in the next 12 months, the amount of unrecognized tax benefits related to the resolution of federal, state and foreign matters could be reduced by $2.7 million as audits close, statutes expire and amended tax returns are filed.

        As of October 1, 2010 and October 2, 2009, the Company had $0.8 million and $0.6 million of accrued income tax related interest and penalties on unrecognized tax benefits, respectively. Interest included in the Company's provision for income taxes was an expense of $0.2 million for fiscal year 2010 and a benefit of $1.2 million for fiscal year 2009. If the accrued interest and penalties do not ultimately become payable, amounts accrued will be reduced in the period that such determination is made, and reflected as a reduction of the income tax provision.

        A reconciliation of the beginning and ending balances of the total amount of unrecognized tax benefits, excluding accrued interest and penalties is as follows:

	Year ended
	October 1, 2010			October 2, 2009
Unrecognized tax benefits—beginning of year	$	3,328		$	5,609
Settlements and effective settlements with tax authorities and related remeasurements		—			(75	)
Decrease in balances related to expiration of statute of limitations		(82	)		—
Increase in balances related to tax positions taken in current year		3,312			228
Decrease in balances related to tax positions taken in prior years		(86	)		(2,964	)
Increase in balances related to tax positions taken in prior years		31			512
Changes due to translation of foreign currency		82			18
Unrecognized tax benefits—end of year	$	6,585		$	3,328

F-49

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

11. Income taxes (Continued)

        The Company files U.S. federal, California and other U.S. states, Canada and other foreign jurisdictions income tax returns. Generally, fiscal years 2006 to 2009 remain open to examination by the various taxing jurisdictions and the Company has not been audited for U.S. federal income tax matters. The Company has income tax audits in progress in Canada and in several international jurisdictions in which it operates. The years under examination by the Canadian taxing authorities are 2001 to 2002.

        Based on the outcome of examinations of the Company and the result of the expiration of statutes of limitations for specific jurisdictions, it is reasonably possible that the related unrecognized tax benefits could change from those recorded in the statement of financial position. The Company has provided for amounts of anticipated tax audit adjustments in various jurisdictions based on its reasonable estimate of additional taxes and interest that do not meet the more likely than not standard under the accounting guidance for uncertainty in income taxes.

        The Canada Revenue Agency ("CRA") is conducting an audit of the Company's income tax returns in Canada for fiscal years 2001 and 2002. The Company received a proposed tax assessment, including interest expense from the CRA for fiscal years 2001 and 2002. The tax assessment is based on tax deductions related to the valuation of the Satcom business, which was purchased by Communications & Power Industries Canada Inc. from CPI in fiscal years 2001 and 2002. While the Company believes that it has meritorious defenses and intends to vigorously defend its position, it is reasonably possible that the CRA may issue a formal tax assessment requiring the Company to settle the tax deficiency within 12 months. The Company believes that adequate accruals have been provided for any adjustments that may result from the CRA examination.

12. Earnings per share

        As discussed in Note 2, the Company adopted ASC 260 effective October 3, 2009. Under ASC 260, earnings per share is computed using the two-class method, which is an earnings allocation method for computing earnings per share that treats a participating security as having rights to earnings that would otherwise have been available to common stockholders. Certain of the Company's stock-based compensation awards pay nonforfeitable dividends to the participants during the vesting period and, as such, are deemed participating securities. Basic earnings per share are computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding that are increased for additional shares that would be outstanding if potentially dilutive non-participating securities were converted to common shares, pursuant to the treasury stock method.

F-50

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

12. Earnings per share (Continued)

        Earnings per share for the respective periods were calculated as follows:

	Year ended
	October 1, 2010			October 2, 2009(1)			October 3, 2008(1)
Basic Earnings per Share
Net income	$	6,739		$	23,466		$	20,449
Income allocated to participating securities		(116	)		(286	)		(118	)
Net income available to common shareholders	$	6,623		$	23,180		$	20,331
Basic weighted average common shares outstanding		16,571			16,343			16,356
Net income per common share—Basic	$	0.40		$	1.42		$	1.24
Diluted Earnings per Share
Net income	$	6,739		$	23,466		$	20,449
Income allocated to participating securities		(108	)		(268	)		(110	)
Net income available to common shareholders	$	6,631		$	23,198		$	20,339
Basic weighted average common shares outstanding		16,571			16,343			16,356
Effect of dilutive stock options		1,266			1,100			1,328
Diluted weighted average common shares outstanding		17,837			17,443			17,684
Net income per common share—Diluted	$	0.37		$	1.33		$	1.15

(1)

Restated in accordance with ASC 260.

        The calculation of diluted net income per share excludes all anti-dilutive shares from stock options. For fiscal years 2010, 2009 and 2008, the number of anti-dilutive shares, as calculated based on the weighted average price of the Company's common stock for the periods, was approximately 743,000, 864,000 and 731,000 shares, respectively.

13. Segments, geographic and customer information

        The Company's reportable segments are VED and satcom equipment. The VED segment develops, manufactures and distributes high-power/high-frequency microwave and radio frequency signal components. The satcom equipment segment manufactures and supplies high-power amplifiers and networks for satellite communication uplink and industrial applications. Segment information reported below is consistent with the manner in which it is reviewed and evaluated by the Company's chief operating decision maker ("CODM"), its chief executive officer, and is based on the nature of the Company's operations and products offered to customers.

        The Company's reportable segments, VED and satcom equipment, are differentiated based on their underlying profitability and economic performance. The VED segment is made up of four divisions, that have been aggregated based on the similarity of their economic characteristics as measured by EBITDA, and the similarity of their products and services, production processes, types of customers and distribution methods, and nature of regulatory environments. The satcom equipment segment consists of one division. The Company's analysis of the similarity of economic characteristics was based on both a historical and anticipated future analysis of performance.

F-51

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

13. Segments, geographic and customer information (Continued)

        The VED segment develops, manufactures and distributes high power/high frequency microwave and radio frequency signal components. Its products include linear beam, cavity, power grid, crossed field and magnetron devices. These products are used in the communication, radar, electronic countermeasures, industrial, medical and scientific markets depending on the specific power and frequency requirements of the end-user and the physical operating conditions of the environment in which the VED will be located. These products are distributed through the Company's direct sales force, independent sales representatives and distributors.

        The satcom equipment segment manufactures and supplies high power amplifiers and networks for satellite communication uplink and industrial applications. This segment also provides spares, service and other post sales support. Its products are distributed through the Company's direct sales force and independent sales representatives.

        Amounts not reported as VED or satcom equipment are reported as Other. In accordance with quantitative and qualitative guidelines established by FASB ASC 280, "Segment Reporting." Other includes the activities of the Company's Malibu Division and unallocated corporate expenses, such as business combination-related expenses, share-based compensation expense and certain non-recurring or unusual expenses. The Malibu Division is a designer, manufacturer and integrator of advanced antenna systems for radar, radar simulators and telemetry systems, as well as for data links used in ground, airborne, unmanned aerial vehicles ("UAVs") and shipboard systems.

        Sales and marketing, and certain administration expenses, are allocated to the divisions and are included in the results reported. The accounting policies of the reportable segments are the same as those described in the summary of significant accounting policies. Intersegment product transfers are recorded at cost.

F-52

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

13. Segments, geographic and customer information (Continued)

        Summarized financial information concerning the Company's reportable segments is shown in the following tables:

		Year ended
		October 1, 2010			October 2, 2009			October 3, 2008
Sales from external customers
	VED	$	259,141		$	246,717		$	279,364
	Satcom equipment		85,984			69,534			74,264
	Other		15,309			16,625			16,386
		$	360,434		$	332,876		$	370,014
Intersegment product transfers
	VED	$	24,033		$	18,070		$	27,462
	Satcom equipment		96			9			116
		$	24,129		$	18,079		$	27,578
Capital expenditures
	VED	$	3,294		$	2,536		$	2,659
	Satcom equipment		426			141			692
	Other		772			688			911
		$	4,492		$	3,365		$	4,262
EBITDA
	VED	$	65,787		$	54,791		$	69,923
	Satcom equipment		9,451			5,598			5,997
	Other		(36,592	)		(9,368	)		(14,649	)
		$	38,646		$	51,021		$	61,271

		October 1, 2010		October 2, 2009
Total assets
	VED	$	326,117	$	324,490
	Satcom equipment		48,355		46,720
	Other		103,804		87,044
		$	478,276	$	458,254

        EBITDA is the measure used by the CODM to evaluate segment profit or loss. EBITDA represents earnings before net interest expense, provision for income taxes and depreciation and amortization. The Company believes that EBITDA is a more meaningful representation of segment operating performance for leveraged businesses like its own and therefore uses this metric as its internal measure of profitability. For the reasons listed below, the Company believes EBITDA provides

F-53

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

13. Segments, geographic and customer information (Continued)

investors better understanding of the Company's financial performance in connection with their analysis of the Company's business:

•

EBITDA is a component of the measures used by the Company's board of directors and management team to evaluate the Company's operating performance;

•

the Company's Senior Credit Facilities contain a covenant that requires the Company to maintain a senior secured leverage ratio that contains EBITDA as a component, and the Company's management team uses EBITDA to monitor compliance with this covenant;

•

EBITDA is a component of the measures used by the Company's management team to make day-to-day operating decisions;

•

EBITDA facilitates comparisons between the Company's operating results and those of competitors with different capital structures and, therefore, is a component of the measures used by the Company's management to facilitate internal comparisons to competitors' results and the Company's industry in general; and

•

the payment of management bonuses is contingent upon, among other things, the satisfaction by the Company of certain targets that contain EBITDA as a component.

        Other companies may define EBITDA differently and, as a result, the Company's measure of EBITDA may not be directly comparable to EBITDA of other companies. Although the Company uses EBITDA as a financial measure to assess the performance of its business, the use of EBITDA is limited because it does not include certain material costs, such as interest and taxes, necessary to operate the Company's business. When analyzing the Company's performance, EBITDA should be considered in addition to, and not as a substitute for or superior to, operating income, net income, cash flows from operating activities or other statements of income or statements of cash flows data prepared in accordance with U.S. GAAP. Operating income by the Company's reportable segments was as follows:

		Year ended
		October 1, 2010			October 2, 2009			October 3, 2008
Operating income
	VED	$	59,765		$	49,006		$	64,431
	Satcom equipment		8,726			4,861			5,327
	Other		(40,917	)		(13,888	)		(18,817	)
		$	27,574		$	39,979		$	50,941

F-54

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

13. Segments, geographic and customer information (Continued)

        The following table reconciles net income to EBITDA:

		Year ended
		October 1, 2010		October 2, 2009			October 3, 2008
Net income		$	6,739	$	23,466		$	20,449
	Depreciation and amortization		11,072		10,794			10,963
	Interest expense, net		15,213		16,979			19,055
	Income tax expense (benefit)		5,622		(218	)		10,804
	EBITDA	$	38,646	$	51,021		$	61,271

        Net property, plant and equipment by geographic area were as follows:

	October 1, 2010		October 2, 2009
United States	$	41,746	$	45,028
Canada		12,290		12,831
Other		223		53
Total	$	54,259	$	57,912

        With the exception of goodwill, the Company does not identify or allocate assets by operating segment, nor does its CODM evaluate operating segments using discrete asset information.

        Goodwill by geographic area was as follows:

	October 1, 2010		October 2, 2009
United States	$	114,252	$	114,252
Canada		47,973		47,973
	$	162,225	$	162,225

        Geographic sales by customer location were as follows for external customers:

		Year ended
		October 1, 2010		October 2, 2009		October 3, 2008
United States		$	230,888	$	210,590	$	237,909
All foreign countries			129,546		122,286		132,105
	Total sales	$	360,434	$	332,876	$	370,014

        There were no individual foreign countries with sales greater than 10% of total sales for the periods presented.

F-55

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

13. Segments, geographic and customer information (Continued)

        The United States Government is the only customer that accounted for 10% or more of the Company's consolidated sales in fiscal years 2010, 2009 and 2008. Direct sales to the United States Government were $48.5 million, $49.2 million and $68.6 million for fiscal years 2010, 2009 and 2008, respectively. Accounts receivable from this customer represented 12% and 11% of consolidated accounts receivable at October 1, 2010 and October 2, 2009, respectively.

14. Selected quarterly financial data (Unaudited)

        In management's opinion, the unaudited data has been prepared on the same basis as the audited information and includes all adjustments (consisting only of normal recurring adjustments) necessary for a fair presentation of the data for the periods presented. The Company's results of operations have varied and may continue to fluctuate significantly from quarter to quarter. The results of operations in any period should not be considered indicative of the results to be expected from any future period.

		First quarter		Second quarter		Third quarter		Fourth quarter
Year ended October 1, 2010
	Sales	$	82,767	$	88,352	$	93,876	$	95,439
	Gross profit		23,440		26,722		28,923		29,362
	Net income (loss)		3,841		4,492		4,211		(5,805	)
	Basic earnings per share	$	0.23	$	0.27	$	0.25	$	(0.34	)
	Diluted earnings per share	$	0.21	$	0.25	$	0.23	$	(0.34	)
Year ended October 2, 2009
	Sales	$	77,146	$	81,903	$	82,520	$	91,307
	Gross profit		19,916		21,766		24,284		27,525
	Net income		7,655		3,689		3,870		8,252
	Basic earnings per share(1)	$	0.47	$	0.22	$	0.23	$	0.50
	Diluted earnings per share(1)	$	0.44	$	0.21	$	0.22	$	0.46

(1)

Restated in accordance with ASC 260.

        Net income for the third quarter of fiscal year 2010 includes after-tax transaction expenses of $2.2 million relating to the previously announced merger agreement with Comtech.

        Net loss for the fourth quarter of fiscal year 2010 reflects after-tax termination fee and transaction expenses totaling $12.9 million relating to the merger agreement with Comtech.

        Net income for the first quarter of fiscal year 2009 includes two significant discrete tax benefits: (1) $5.1 million related to the Company's position with regard to an outstanding audit by the Canada Revenue Agency, and (2) $0.6 million for an adjustment to Canadian tax accounts.

        Net income for the second quarter of fiscal year 2009 includes a significant discrete tax benefit of $0.7 million related to certain provisions of the California Budget Act of 2008 signed in February 2009.

F-56

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

15. Subsequent events

        Pursuant to the agreement and plan of merger, dated as of November 24, 2010, among the Company, CPI International, Inc. (formerly Catalyst Holdings, Inc. and CPI International Acquisition, Inc., "CPII") a Delaware Corporation, and Catalyst Acquisition, Inc. ("Merger Sub"), a wholly owned subsidiary of CPII, on February 11, 2011, Merger Sub merged with and into the Company, with the Company continuing as the surviving corporation and a wholly owned subsidiary of CPII, and the separate corporate existence of Merger Sub ceased (the "Merger"). The Company's common stock is no longer publicly traded as a result of the Merger. Immediately following the consummation of the Merger and related transactions, the Company was converted into a limited liability company and liquidated, and CPII changed its name to CPI International, Inc. from CPI International Acquisition, Inc.

        CPI International Holding LLC ("Holding LLC"), a Delaware limited liability company, owns all of the outstanding common stock of CPI International Holding Corp. (formerly Catalyst Holdings 2, Inc., "Parent"), a Delaware corporation, which in turn owns all of the outstanding common stock of CPII, which now in turn owns all of the outstanding equity interests of Communications & Power Industries LLC (formerly Communications & Power Industries, Inc., "CPI") and Communications & Power Industries Canada Inc., CPII's main operating subsidiaries.

        Pursuant to the terms of the merger agreement, each outstanding share of common stock of the Company was converted into the right to receive $19.50 in cash in the Merger. Subject to certain exceptions, each option to purchase shares of the Company's common stock that was granted under its equity compensation plans and outstanding immediately prior to the closing became vested and was canceled at (or shortly following) the closing in exchange for cash equal to the excess, if any, of (i) $19.50 reduced by (ii) the per-share exercise price of such option. Subject to certain exceptions, each restricted stock award and restricted stock unit granted under the Company's equity compensation plans outstanding immediately prior to the closing was canceled at the closing in exchange for a payment, in cash, equal to $19.50.

        In connection with the Merger, The Veritas Capital Fund IV, L.P. and certain of its affiliates invested $200.0 million, solely for the purpose of purchasing equity securities of Holding LLC in order to provide a portion of the financing required for the Merger and the transactions contemplated by the merger agreement. Certain officers of the Company also invested in equity securities of Holding LLC in an aggregate amount of $11.1 million.

        On February 11, 2011, CPII entered into the senior secured credit facilities consisting of (i) a $150,000 six-year term loan facility; and (ii) a $30,000 five-year revolving credit facility (the "Senior Secured Credit Facilities"). CPII borrowed the full amount of the term loan thereunder, and the revolving credit facility was undrawn at closing (other than for approximately $4,500 of outstanding letters of credit). CPII has the option to increase the amount available under the Senior Secured Credit Facilities by up to an aggregate of $50,000 on an uncommitted basis.

        The revolving credit facility includes borrowing capacity available for letters of credit and for short-term borrowings referred to as the swing line borrowings. CPII's obligations under the Senior Secured Credit Facilities are fully and unconditionally guaranteed by Parent and, subject to certain exceptions, each of Parent's existing and future domestic restricted subsidiaries (other than CPII). In addition, CPII's obligations under the Senior Secured Credit Facilities and the guarantees of those

F-57

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

15. Subsequent events (Continued)

obligations are secured by substantially all of CPII's assets and all of the assets of the guarantors, including but not limited to (a) pledges of all the equity interests held by CPII and each guarantor and (b) a first-priority security interest in, and mortgages on, substantially all of the present and after acquired assets of CPII and each guarantor, in each case subject to certain exceptions.

        Borrowings under the term loan facility and the revolving credit facility bear interest, at CPII's option, at a rate equal to a margin over either (a) a base rate or (b) LIBOR. As of March 29, 2011, the term loan facility bears an interest rate of 4% margin over LIBOR of 1% or 5%. The Senior Secured Credit Facilities are subject to amortization and prepayment requirements and contain customary representations and warranties, covenants, events of default and other provisions.

        In addition, on February 11, 2011, CPII issued $215 million aggregate principal amount of 8.00% Senior Notes due 2018 (the "Notes"). The Notes are CPII's senior unsecured obligations. Parent and, subject to certain exceptions, each of Parent's existing and future domestic restricted subsidiaries (other than CPII) guarantee the notes on a senior unsecured basis. The Notes bear interest at the rate of 8.0% per year. Subject to certain exceptions, the indenture governing the Notes limits CPII's and its restricted subsidiaries' ability to incur additional indebtedness or issue certain preferred stock; pay dividends and make other restricted payments; make certain investments; sell all or substantially all assets; create liens; consolidate, merge or sell all or substantially of the CPII's assets; enter into transactions with affiliates and designate subsidiaries as unrestricted subsidiaries; and contains customary events of default and other provisions.

        In addition, in connection with the Merger, on January 13, 2011, CPI offered to purchase all $117.0 million aggregate principal amount of its existing outstanding 8% Senior Subordinated Notes due 2012 (the "8% Notes"), and the Company offered to purchase all $12.0 million aggregate principal amount of its existing outstanding Floating Rate Senior Notes due 2015 (the "FR Notes") pursuant to tender offers and related consent solicitations. All outstanding FR Notes and a portion of the 8% Notes were tendered pursuant to such tender offers and purchased by the Company and CPI, respectively, on February 11, 2011. CPI redeemed all remaining outstanding 8% Notes on March 14, 2011.

        CPII used the equity contributions, borrowings under the term loan facility and the net proceeds from the Notes to pay the Merger consideration, consummate the tender offers and redemption in connection with the Merger and pay related fees and expenses.

16. Supplemental guarantors condensed consolidating financial information

        The tables that follow reflect the supplemental guarantor financial information associated with CPII's newly issued 8.00% Senior Notes due 2018 (the "Notes"). As discussed in Note 15, Subsequent Events, the Notes are guaranteed by Parent and, subject to certain exceptions, each of Parent's existing and future domestic restricted subsidiaries (other than CPII) on a senior unsecured basis. Separate financial statements of the guarantor subsidiaries are not presented because (i) the guarantors are wholly owned and have fully and unconditionally guaranteed the Notes on a joint and several basis and (ii) CPII's management has determined that such separate financial statements are not material to investors. Instead, presented below are the consolidating financial statements of: (a) the guarantor subsidiaries (all of the domestic subsidiaries), (b) the non-guarantor subsidiaries, (c) the consolidating elimination entries, and (d) the consolidated totals. The accompanying consolidating financial information should be read in connection with the consolidated financial statements of the Company.

        Investments in subsidiaries are accounted for based on the equity method. The principal elimination entries eliminate investments in subsidiaries, intercompany balances, intercompany transactions and intercompany sales.

F-58

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

16. Supplemental guarantors condensed consolidating financial information (Continued)

Condensed Consolidating Balance Sheet
As of October 1, 2010

		Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Eliminations			Consolidated Total
Assets
Cash and cash equivalents		$	30,336		$	12,493	$	—		$	42,829
Restricted cash			1,710			94		—			1,804
Accounts receivable, net			30,332			15,375		—			45,707
Inventories			54,814			21,070		(676	)		75,208
Deferred tax assets			10,947			83		—			11,030
Intercompany receivable			9,660			16,677		(26,337	)		—
Prepaid and other current assets			5,132			1,327		—			6,459
	Total current assets		142,931			67,119		(27,013	)		183,037
Property, plant and equipment, net			41,778			12,481		—			54,259
Deferred debt issue costs, net			1,604			—		—			1,604
Intangible assets, net			66,014			6,460		—			72,474
Goodwill			114,280			47,945		—			162,225
Other long-term assets			4,677			—		—			4,677
Investment in subsidiaries			102,577			—		(102,577	)		—
	Total assets	$	473,861		$	134,005	$	(129,590	)	$	478,276
Liabilities and stockholders' equity
Current portion of long-term debt		$	66,000		$	—	$	—		$	66,000
Accounts payable			13,562			10,728		—			24,290
Accrued expenses			18,438			5,215		—			23,653
Product warranty			3,449			1,652		—			5,101
Income taxes payable			699			4,323		—			5,022
Advance payments from customers			10,253			3,965		—			14,218
Intercompany payable			26,337			—		(26,337	)		—
	Total current liabilities		138,738			25,883		(26,337	)		138,284
Deferred income taxes			17,644			4,063		—			21,707
Long-term debt, less current portion			128,934			—		—			128,934
Other long-term liabilities			4,605			806		—			5,411
	Total liabilities		289,921			30,752		(26,337	)		294,336
Common stock			170			—		—			170
Parent investment			—			50,969		(50,969	)		—
Additional paid-in capital			80,015			—		—			80,015
Accumulated other comprehensive (loss) gain			(141	)		84		(84	)		(141	)
Retained earnings			106,696			52,200		(52,200	)		106,696
Treasury stock			(2,800	)		—		—			(2,800	)
	Total stockholders' equity		183,940			103,253		(103,253	)		183,940
	Total liabilities and stockholders' equity	$	473,861		$	134,005	$	(129,590	)	$	478,276

F-59

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

16. Supplemental guarantors condensed consolidating financial information (Continued)

Condensed Consolidating Balance Sheet
As of October 2, 2009

		Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Eliminations			Consolidated Total
Assets
Cash and cash equivalents		$	15,824		$	10,328		$	—		$	26,152
Restricted cash			1,467			94			—			1,561
Accounts receivable, net			31,037			14,108			—			45,145
Inventories			49,499			18,117			(620	)		66,996
Deferred tax assets			8,496			156			—			8,652
Intercompany receivable			15,784			10,534			(26,318	)		—
Prepaid and other current assets			5,871			829			—			6,700
	Total current assets		127,978			54,166			(26,938	)		155,206
Property, plant and equipment, net			45,049			12,863			—			57,912
Deferred debt issue costs, net			3,609			—			—			3,609
Intangible assets, net			68,368			7,062			—			75,430
Goodwill			114,280			47,945			—			162,225
Other long-term assets			3,872			—			—			3,872
Intercompany notes receivable			1,035			—			(1,035	)		—
Investment in subsidiaries			97,529			—			(97,529	)		—
	Total assets	$	461,720		$	122,036		$	(125,502	)	$	458,254
Liabilities and stockholders' equity
Accounts payable		$	13,829		$	8,836		$	—		$	22,665
Accrued expenses			15,064			3,951			—			19,015
Product warranty			2,345			1,500			—			3,845
Income taxes payable			1,834			2,471			—			4,305
Advance payments from customers			11,757			1,239			—			12,996
Intercompany payable			26,318			—			(26,318	)		—
	Total current liabilities		71,147			17,997			(26,318	)		62,826
Deferred income taxes			20,342			4,384			—			24,726
Intercompany notes payable			—			1,035			(1,035	)		—
Long-term debt			194,922			—			—			194,922
Other long-term liabilities			1,756			471			—			2,227
	Total liabilities		288,167			23,887			(27,353	)		284,701
Common stock			168			—			—			168
Parent investment			—			58,404			(58,404	)		—
Additional paid-in capital			75,630			—			—			75,630
Accumulated other comprehensive gain (loss)			598			(223	)		223			598
Retained earnings			99,957			39,968			(39,968	)		99,957
Treasury stock			(2,800	)		—			—			(2,800	)
	Total stockholders' equity		173,553			98,149			(98,149	)		173,553
	Total liabilities and stockholders' equity	$	461,720		$	122,036		$	(125,502	)	$	458,254

F-60

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

16. Supplemental guarantors condensed consolidating financial information (Continued)

Condensed Consolidating Statement Of Income
For the year ended October 1, 2010

		Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Eliminations			Consolidated Total
Sales		$	289,063		$	149,742	$	(78,371	)	$	360,434
Cost of sales			219,647			110,655		(78,315	)		251,987
Gross profit			69,416			39,087		(56	)		108,447
Operating costs and expenses:
	Research and development		3,987			8,442		—			12,429
	Selling and marketing		11,695			9,099		—			20,794
	General and administrative		19,424			5,564		—			24,988
	Amortization of acquisition-related intangible assets		2,145			604		—			2,749
	Strategic alternative transaction expenses		19,913			—		—			19,913
Total operating costs and expenses			57,164			23,709		—			80,873
Operating (loss) income			12,252			15,378		(56	)		27,574
Interest expense (income), net			15,166			47		—			15,213
(Loss) income before income tax expense and equity in income of subsidiaries			(2,914	)		15,331		(56	)		12,361
	Income tax (benefit) expense		2,523			3,099		—			5,622
	Equity in income of subsidiaries		12,176			—		(12,176	)		—
Net income		$	6,739		$	12,232	$	(12,232	)	$	6,739

F-61

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

16. Supplemental guarantors condensed consolidating financial information (Continued)

Condensed Consolidating Statement Of Income
For the year ended October 2, 2009

		Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Eliminations			Consolidated Total
Sales		$	284,706		$	128,105		$	(79,935	)	$	332,876
Cost of sales			218,224			101,466			(80,305	)		239,385
Gross profit			66,482			26,639			370			93,491
Operating costs and expenses:
	Research and development		3,331			7,189			—			10,520
	Selling and marketing		11,588			7,878			—			19,466
	General and administrative		17,754			3,003			—			20,757
	Amortization of acquisition-related intangible assets		2,165			604			—			2,769
Total operating costs and expenses			34,838			18,674			—			53,512
Operating income			31,644			7,965			370			39,979
	Interest expense (income), net		16,898			81			—			16,979
	Gain on debt extinguishment		(248	)		—			—			(248	)
(Loss) income before income tax expense and equity in income of subsidiaries			14,994			7,884			370			23,248
	Income tax (benefit) expense		1,773			(1,991	)		—			(218	)
	Equity in income of subsidiaries		10,245			—			(10,245	)		—
Net income		$	23,466		$	9,875		$	(9,875	)	$	23,466

F-62

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

16. Supplemental guarantors condensed consolidating financial information (Continued)

Condensed Consolidating Statement Of Income
For the year ended October 3, 2008

		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Eliminations			Consolidated Total
Sales		$	309,280	$	140,420	$	(79,686	)	$	370,014
Cost of sales			232,185		108,275		(79,374	)		261,086
Gross profit			77,095		32,145		(312	)		108,928
Operating costs and expenses:
	Research and development		3,552		7,237		—			10,789
	Selling and marketing		12,218		8,926		—			21,144
	General and administrative		18,752		4,199		—			22,951
	Amortization of acquisition-related intangible assets		2,499		604		—			3,103
Total operating costs and expenses			37,021		20,966		—			57,987
Operating income			40,074		11,179		(312	)		50,941
	Interest expense (income), net		19,036		19		—			19,055
	Loss on debt extinguishment		633		—		—			633
(Loss) income before income tax expense and equity in income of subsidiaries			20,405		11,160		(312	)		31,253
	Income tax (benefit) expense		7,975		2,829		—			10,804
	Equity in income of subsidiaries		8,019		—		(8,019	)		—
Net income		$	20,449	$	8,331	$	(8,331	)	$	20,449

F-63

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

16. Supplemental guarantors condensed consolidating financial information (Continued)

Condensed Consolidating Statement Of Cash Flows
For the year ended October 1, 2010

		Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Eliminations		Consolidated Total
Cash flows from operating activities
	Net cash (used in) provided by operating activities	$	16,917		$	2,891		$	—	$	19,808
Cash flows from investing activities
	Capital expenditures and others		(3,807	)		(726	)		—		(4,533	)
	Net cash used in investing activities		(3,807	)		(726	)		—		(4,533	)
Cash flows from financing activities
	Proceeds from stock purchase plan and exercises of stock options		809			—			—		809
	Intercompany dividends / debt		—			—			—		—
	Excess tax benefit on stock option exercises		593			—			—		593
	Net cash provided by (used in) financing activities		1,402			—			—		1,402
Net increase in cash and cash equivalents			14,512			2,165			—		16,677
	Cash and cash equivalents at beginning of year		15,824			10,328			—		26,152
	Cash and cash equivalents at end of year	$	30,336		$	12,493		$	—	$	42,829

F-64

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

16. Supplemental guarantors condensed consolidating financial information (Continued)

Condensed Consolidating Statement Of Cash Flows
For the year ended October 2, 2009

		Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Eliminations		Consolidated Total
Cash flows from operating activities
	Net cash (used in) provided by operating activities	$	29,259		$	855		$	—	$	30,114
Cash flows from investing activities
	Capital expenditures		(3,228	)		(137	)		—		(3,365	)
	Net cash used in investing activities		(3,228	)		(137	)		—		(3,365	)
Cash flows from financing activities
	Proceeds from stock purchase plan and exercises of stock options		1,037			—			—		1,037
	Repayments of debt		(30,358	)		—			—		(30,358	)
	Intercompany dividends / debt		(7,789	)		7,789			—		—
	Excess tax benefit on stock option exercises		54			—			—		54
	Net cash provided by (used in) financing activities		(37,056	)		7,789			—		(29,267	)
Net (decrease) increase in cash and cash equivalents			(11,025	)		8,507			—		(2,518	)
	Cash and cash equivalents at beginning of year		26,849			1,821			—		28,670
	Cash and cash equivalents at end of year	$	15,824		$	10,328		$	—	$	26,152

F-65

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular amounts in thousands except share and per share amounts)

16. Supplemental guarantors condensed consolidating financial information (Continued)

Condensed Consolidating Statement Of Cash Flows
For the year ended October 3, 2008

		Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Eliminations		Consolidated Total
Cash flows from operating activities
	Net cash (used in) provided by operating activities	$	22,960		$	10,921		$	—	$	33,881
Cash flows from investing activities
	Capital expenditures		(3,542	)		(720	)		—		(4,262	)
	Acquisitions, net of cash acquired		1,615			—			—		1,615
	Payment of patent application fees		(147	)		—			—		(147	)
	Net cash used in investing activities		(2,074	)		(720	)		—		(2,794	)
Cash flows from financing activities
	Proceeds from stock purchase plan and exercises of stock options		891			—			—		891
	Repayments of debt		(21,000	)		—			—		(21,000	)
	Purchase of treasury stock		(2,800	)		—			—		(2,800	)
	Intercompany dividends / debt		10,000			(10,000	)		—		—
	Excess tax benefit on stock option exercises		18			—			—		18
	Net cash provided by (used in) financing activities		(12,891	)		(10,000	)		—		(22,891	)
Net (decrease) increase in cash and cash equivalents			7,995			201			—		8,196
	Cash and cash equivalents at beginning of year		18,854			1,620			—		20,474
	Cash and cash equivalents at end of year	$	26,849		$	1,821		$	—	$	28,670

F-66

CPI INTERNATIONAL, INC.
and Subsidiaries

Unaudited Condensed Consolidated Financial Statements

CONDENSED CONSOLIDATED BALANCE SHEETS

(In thousands, except per share data—unaudited)

			December 31, 2010			October 1, 2010
Assets
Current Assets:
	Cash and cash equivalents		$	59,907		$	42,829
	Restricted cash			3,060			1,804
	Accounts receivable, net			39,423			45,707
	Inventories			78,445			75,208
	Deferred tax assets			11,887			11,030
	Prepaid and other current assets			6,112			6,459
		Total current assets		198,834			183,037
Property, plant, and equipment, net				52,550			54,259
Deferred debt issue costs, net				1,344			1,604
Intangible assets, net				71,730			72,474
Goodwill				162,225			162,225
Other long-term assets				5,465			4,677
		Total assets	$	492,148		$	478,276
Liabilities and stockholders' equity
Current Liabilities:
	Current portion of long-term debt		$	66,000		$	66,000
	Accounts payable			22,195			24,290
	Accrued expenses			29,837			23,653
	Product warranty			5,418			5,101
	Income taxes payable			3,522			5,022
	Advance payments from customers			21,766			14,218
		Total current liabilities		148,738			138,284
Deferred income taxes				21,542			21,707
Long-term debt, less current portion				128,937			128,934
Other long-term liabilities				5,451			5,411
		Total liabilities		304,668			294,336
Commitments and contingencies
Stockholders' equity
	Common stock ($0.01 par value, 90,000 shares authorized; 17,059 and 17,020 shares issued; 16,852 and 16,813 shares outstanding)			171			170
	Additional paid-in capital			81,235			80,015
	Accumulated other comprehensive loss			(44	)		(141	)
	Retained earnings			108,918			106,696
	Treasury stock, at cost (206 shares)			(2,800	)		(2,800	)
		Total stockholders' equity		187,480			183,940
		Total liabilities and stockholders' equity	$	492,148		$	478,276

The accompanying notes are an integral part of these
unaudited condensed consolidated financial statements.

F-67

CPI INTERNATIONAL, INC.
and Subsidiaries

CONDENSED CONSOLIDATED
STATEMENTS OF INCOME AND COMPREHENSIVE INCOME

(In thousands, except per share data—unaudited)

		Quarter Ended
		December 31, 2010		January 1, 2010
Sales		$	89,020	$	82,767
Cost of sales			64,099		59,327
Gross profit			24,921		23,440
Operating costs and expenses:
	Research and development		3,130		2,556
	Selling and marketing		5,244		5,040
	General and administrative		6,316		5,525
	Amortization of acquisition-related intangible assets		686		687
	Strategic alternative transaction expenses		2,657		—
Total operating costs and expenses			18,033		13,808
Operating income			6,888		9,632
Interest expense, net			3,711		3,881
Income before income taxes			3,177		5,751
Income tax expense			955		1,910
Net income		$	2,222	$	3,841
Other comprehensive income, net of tax
	Net unrealized gain on cash flow hedges and minimum pension liability adjustment		97		844
Comprehensive income		$	2,319	$	4,685
Earnings per common share—Basic		$	0.13	$	0.23
Earnings per common share—Diluted		$	0.12	$	0.21
Shares used to compute earnings per common share—Basic			16,695		16,452
Shares used to compute earnings per common share—Diluted			18,076		17,630

The accompanying notes are an integral part of these
unaudited condensed consolidated financial statements.

F-68

CPI INTERNATIONAL, INC.
and Subsidiaries

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands—unaudited)

			Quarter Ended
			December 31, 2010			January 1, 2010
Cash flows from operating activities
		Net cash provided by operating activities	$	17,487		$	9,564
Cash flows from investing activities
	Capital expenditures			(447	)		(811	)
	Payment of patent application fees			(6	)		—
		Net cash used in investing activities		(453	)		(811	)
Cash flows from financing activities
	Payment for Senior Credit Facilities agreement amendment (Note 6)			(379	)		—
	Proceeds from issuance of common stock to employees			217			189
	Proceeds from exercise of stock options			136			14
	Excess tax benefit on stock option exercises			70			2
		Net cash provided by financing activities		44			205
Net increase in cash and cash equivalents				17,078			8,958
	Cash and cash equivalents at beginning of period			42,829			26,152
	Cash and cash equivalents at end of period		$	59,907		$	35,110
Supplemental cash flow disclosures
	Cash paid for interest		$	800		$	1,054
	Cash paid for income taxes, net of refunds		$	3,284		$	2,273

The accompanying notes are an integral part of these
unaudited condensed consolidated financial statements.

F-69

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts)

1. The Company and a Summary of its Significant Accounting Policies

The Company

        Unless the context otherwise requires, "CPI International" means CPI International, Inc., and "CPI" means Communications & Power Industries, Inc. CPI is a direct subsidiary of CPI International. CPI International is a holding company with no operations of its own. The term "the Company" refers to CPI International and its direct and indirect subsidiaries on a consolidated basis.

        The accompanying condensed consolidated financial statements represent the consolidated results and financial position of CPI International, which is controlled by affiliates of The Cypress Group L.L.C. CPI International, through its wholly owned subsidiary, CPI, develops, manufactures and distributes microwave and power grid Vacuum Electron Devices ("VEDs"), microwave amplifiers, modulators, antenna systems and various other power supply equipment and devices. The Company has two reportable segments: VED and satcom equipment.

        Liquidity:    The Company has historically financed, and intends to continue to finance, its capital and working capital requirements including debt service and internal growth, through a combination of cash flows from its operations and borrowings under its senior credit facilities. In addition, the Company is party to a merger agreement, as described in further details in Note 4, with Catalyst Acquisition, Inc., a wholly owned subsidiary of CPI International Acquisition, Inc. (formerly Catalyst Holdings, Inc.). Catalyst Acquisition, Inc. and CPI International Acquisition, Inc. are affiliates of The Veritas Capital Fund IV, L.P. (the "Veritas Fund"). If the merger closes, the Company expects to receive financing proceeds as a result of an equity contribution from the Veritas Fund and certain of its affiliates and net proceeds from the offering of senior notes and borrowings under the new term loan facility expected to be entered into by CPI International Acquisition, Inc. at the closing of the current pending merger.

        If the merger closes, the Company believes that the financial resources from the refinancing taking place in connection with the merger, its cash on hand, and expected cash flows from operations will be sufficient to meet its business requirements, including capital expenditures and working capital requirements for the next 12 months, and to repay the $66.0 million outstanding under its senior credit facility term loan scheduled to come due on August 1, 2011, as well as the $117.0 million of its outstanding 8% senior subordinated notes and the $12.0 million of its outstanding floating rate senior notes prior to their scheduled maturity dates. It is anticipated that the amounts outstanding under the Company's existing senior credit facility term loan and under its currently outstanding notes will be repaid in connection with the merger.

Basis of Presentation and Consolidation

        The Company's fiscal year is the 52- or 53-week period that ends on the Friday nearest September 30. Fiscal years 2011 and 2010 comprised the 52-week periods ending September 30, 2011 and October 1, 2010, respectively. The first quarters of both fiscal years 2011 and 2010 include 13 weeks. All period references are to the Company's fiscal periods unless otherwise indicated.

        The accompanying unaudited condensed consolidated financial statements of the Company as of December 31, 2010 and for the first quarter of fiscal years 2011 and 2010 are unaudited and reflect all normal recurring adjustments which are, in the opinion of management, necessary for the fair

F-70

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

1. The Company and a Summary of its Significant Accounting Policies (Continued)

presentation of such financial statements. These unaudited condensed consolidated financial statements should be read in conjunction with the Company's consolidated financial statements and notes thereto included in the Company's Annual Report on Form 10-K for the fiscal year ended October 1, 2010. The condensed consolidated balance sheet as of October 1, 2010 has been derived from the audited financial statements at that date. The results of operations and cash flows for the interim period ended December 31, 2010 are not necessarily indicative of results to be expected for the full year. Should the merger noted above and discussed in note 4 be completed, the Company anticipates the transaction will be accounted for as a business combination and result in a change in basis of its balance sheet as of the merger date. Such accounting will result in significant changes to the Company's balance sheet and income statement in future periods including recording all assets and liabilities at fair value as of the merger date, recognition of additional goodwill and, in periods after the merger, increased amortization of intangible assets which will reduce net income.

        The accompanying unaudited condensed consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries. All significant intercompany balances, transactions and stockholdings have been eliminated in consolidation.

Use of Estimates and Assumptions

        The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and the reported amounts of sales and costs and expenses during the reporting period. On an ongoing basis, the Company evaluates its estimates, including those related to revenue recognition; inventory and inventory valuation; business combinations; recoverability and valuation of recorded amounts of long-lived assets and identifiable intangible assets, including goodwill; recognition of share-based compensation; and recognition and measurement of current and deferred income tax assets and liabilities. The Company bases its estimates on various factors and information, which may include, but are not limited to, history and prior experience, experience of other enterprises in the same industry, new related events, current economic conditions and information from third-party professionals that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

2. Recently Issued Accounting Standards

        In October 2009, the Financial Accounting Standards Board ("FASB") issued Accounting Standards Update ("ASU") 2009-13, "Revenue Recognition (Topic 605): Multiple Deliverable Revenue Arrangements—A Consensus of the FASB Emerging Issues Task Force." This update provides application guidance on whether multiple deliverables exist, how the deliverables should be separated and how the consideration should be allocated to one or more units of accounting. This update eliminates the residual method of allocation for multiple-deliverable revenue arrangements, and requires that arrangement consideration be allocated at the inception of an arrangement to all deliverables. The selling price used for each deliverable will be based on vendor-specific objective

F-71

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

2. Recently Issued Accounting Standards (Continued)

evidence ("VSOE"), if available, third-party evidence ("TPE") if VSOE is not available, or estimated selling price if neither VSOE or TPE is available. Additionally, ASU 2009-13 expands the disclosure requirements related to a vendor's multiple-deliverable revenue arrangements. The Company adopted the provisions of this guidance under ASU 2009-13 effective October 2, 2010. The adoption did not have a material impact on the Company's consolidated results of operations, financial position or cash flows.

        In September 2009, the FASB issued ASU 2009-14, "Certain Revenue Arrangements That Include Software Elements," which is included in the Accounting Standards Codification ("ASC") Topic 985, "Software." ASU 2009-14 amends previous software revenue recognition to exclude (a) non-software components of tangible products and (b) software components of tangible products that are sold, licensed, or leased with tangible products when the software components and non-software components of the tangible product function together to deliver the tangible product's essential functionality. The Company adopted the provisions of this update under ASU 2009-14 effective October 2, 2010. The adoption did not have a material impact on the Company's consolidated results of operations, financial position or cash flows.

        In December 2009, the FASB issued ASU 2009-17, "Improvements to Financial Reporting by Enterprises Involved with Variable Interest Entities," as a further clarification to ASC 810-10, "Consolidation of Variable Interest Entities." ASU 2009-17, upon adoption, requires the use of a qualitative analysis to determine the primary beneficiary of a variable interest entity ("VIE"), amends the guidance for determining if an entity is a VIE and enhances the disclosure requirements regarding an enterprise's involvement with a VIE. The Company adopted the provisions of this update under ASU 2009-17 effective October 2, 2010. Since the Company does not currently have variable interest entities, this update did not have an impact on the Company's consolidated results of operations, financial position or cash flows.

        In January 2010, the FASB issued ASU 2010-06, "Fair Value Measurements and Disclosures: Improving Disclosures About Fair Value Measurements." This update requires reporting entities to make new disclosures about recurring or nonrecurring fair-value measurements including significant transfers into and out of Level 1 and Level 2 fair-value measurements and information on purchases, sales, issuances, and settlements on a gross basis in the reconciliation of Level 3 fair-value measurements. The Company adopted the provisions of this guidance under ASU 2009-06, except for Level 3 reconciliation disclosures, effective January 2, 2010 with no impact on the Company's consolidated results of operations, financial position or cash flows. The level 3 reconciliation disclosures are effective for annual periods beginning after December 15, 2010, and for interim periods within those fiscal years. As the level 3 reconciliation is also disclosure-related, its adoption is not expected to have an impact on the Company's consolidated results of operations, financial position or cash flows.

        In April 2010, the FASB issued ASU 2010-17, "Revenue Recognition—Milestone Method (Topic 605): Milestone Method of Revenue Recognition." ASU 2010-17 provides guidance on applying the milestone method to milestone payments for achieving specified performance measures when those payments are related to uncertain future events. The scope of ASU 2010-17 is limited to transactions involving research or development. This update further states that the milestone method is not the only acceptable method of revenue recognition for milestone payments. Accordingly, entities can make an

F-72

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

2. Recently Issued Accounting Standards (Continued)

accounting policy election to recognize arrangement consideration received for achieving specified performance measures during the period in which the milestones are achieved, provided certain criteria are met. An entity's policy for recognizing deliverable consideration or unit of accounting consideration contingent upon achievement of a milestone shall be applied consistently to similar deliverables or units of accounting. The Company adopted the provisions of this update under ASU 2010-17 effective October 2, 2010. The adoption did not have a material impact on the Company's consolidated results of operations, financial position or cash flows.

        In December 2010, the FASB issued ASU 2010-28, "Goodwill and Other (Topic 350): When to Perform Step 2 of the Goodwill Impairment Test for Reporting Units with Zero or Negative Carrying Amounts." ASU 2010-28 modifies Step 1 of the goodwill impairment test for reporting units with zero or negative carrying amounts. For those reporting units, an entity is required to perform Step 2 of the goodwill impairment test if it is more likely than not that a goodwill impairment exists. In determining whether it is more likely than not that a goodwill impairment exists, an entity must consider whether there are any adverse qualitative factors indicating an impairment may exist. ASU 2010-28 is effective for fiscal years, and interim periods within those years, beginning December 15, 2010. The adoption of this ASU is not expected to have a material impact on the Company's consolidated results of operations, financial position or cash flows.

        In December 2010, the FASB issued ASU 2010-29, "Business Combinations (Topic 805): Disclosure of Supplementary Pro Forma Information for Business Combinations." ASU 2010-29 requires that if a public entity presents comparative financial statements, the entity should disclose revenue and earnings of the combined entity as though the business combination(s) that occurred during the current year had occurred as of the beginning of the comparable prior annual reporting period only. This ASU also expands the supplemental pro forma adjustments to include a description of the nature and amount of material, nonrecurring pro forma adjustments directly attributable to the business combination included in the reported pro forma revenue and earnings. ASU 2010-29 is effective prospectively for business combinations for which the acquisition date is on or after the first annual reporting period beginning on or after December 15, 2010. As this ASU is disclosure-related, it is not expected to have a material impact on the Company's consolidated results of operations, financial position or cash flows.

3. Supplemental Balance Sheet Information

        Accounts Receivable:    Accounts receivable are stated net of allowances for doubtful accounts as follows:

		December 31, 2010			October 1, 2010
Accounts receivable		$	39,498		$	45,819
Less: Allowance for doubtful accounts			(75	)		(112	)
	Accounts receivable, net	$	39,423		$	45,707

F-73

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

3. Supplemental Balance Sheet Information (Continued)

        Inventories:    The following table provides details of inventories:

	December 31, 2010		October 1, 2010
Raw material and parts	$	44,039	$	42,167
Work in process		25,803		24,531
Finished goods		8,603		8,510
	$	78,445	$	75,208

        Reserve for loss contracts:    The following table summarizes the activity related to reserves for loss contracts:

		Quarter Ended
		December 31, 2010			January 1, 2010
Balance at beginning of period		$	3,737		$	4,068
Provision for loss contracts, charged to cost of sales			1,594			1,111
Credit to cost of sales upon revenue recognition			(426	)		(668	)
	Balance at end of period	$	4,905		$	4,511

        Reserve for loss contracts are reported in the condensed consolidated balance sheet in the following accounts:

	December 31, 2010		January 1, 2010
Inventories	$	4,018	$	4,391
Accrued expenses		887		120
	$	4,905	$	4,511

        Product Warranty:    The following table summarizes the activity related to product warranty:

	Quarter Ended
	December 31, 2010			January 1, 2010
Beginning accrued warranty	$	5,101		$	3,845
Actual costs of warranty claims		(1,334	)		(1,170	)
Estimates for product warranty, charged to cost of sales		1,651			1,286
Ending accrued warranty	$	5,418		$	3,961

F-74

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

3. Supplemental Balance Sheet Information (Continued)

        Accumulated Other Comprehensive Income:    The following table provides the components of accumulated other comprehensive income in the condensed consolidated balance sheets:

	December 31, 2010			October 1, 2010
Unrealized gain on cash flow hedges, net of tax	$	272		$	175
Unrealized actuarial loss and prior service credit for pension liability, net of tax		(316	)		(316	)
	$	(44	)	$	(141	)

4. Merger Agreement

        The Company entered into an Agreement and Plan of Merger dated as of November 24, 2010 ("Merger Agreement") with Catalyst Acquisition, Inc. ("Merger Sub"), an indirect wholly owned subsidiary of CPI International Acquisition, Inc. (formerly Catalyst Holdings, Inc.). CPI International Acquisition, Inc. is an indirect wholly owned subsidiary of CPI International Holding Corp. ("Parent"). Parent, Merger Sub and CPI International Acquisition, Inc. are affiliates of the Veritas Fund.

        The Merger Agreement contemplates that Merger Sub will be merged with and into the Company, with the Company surviving as a wholly-owned subsidiary of Parent (the "Merger"), and each outstanding share of the Company's common stock will be converted in the Merger into the right to receive $19.50 per share in cash.

        The Company has made customary representations, warranties and covenants in the Merger Agreement, including (i) its agreement, subject to certain exceptions, to conduct business in the ordinary course and not to engage in certain activities between the execution of the Merger Agreement and the consummation of the merger and (ii) its agreement to not solicit or knowingly encourage alternative transactions or, subject to certain exceptions, enter into discussions concerning, or provide information in connection with, alternative transactions.

        The completion of the Merger is subject to certain conditions, including, among others, (i) the adoption of the Merger Agreement by the Company's stockholders, (ii) the absence of certain legal impediments to the consummation of the merger, (iii) the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and certain approvals under foreign anti-competition laws, (iv) subject to certain materiality exceptions, the accuracy of the representations and warranties made by Parent and the Company, respectively, and (v) compliance by Parent and the Company with the respective obligations under the Merger Agreement. The completion of the Merger is not subject to a financing condition. However, generally, Parent will not be required to close the merger until completion of a marketing period set forth in the Merger Agreement.

        The Merger Agreement contains typical mutual termination rights, including termination by mutual agreement of the parties, for any final and nonappealable order or law enjoining or prohibiting or making illegal the Merger or for failure to obtain the Company's stockholder approval. In addition, either party may terminate the Merger Agreement if the Merger is not consummated by April 15, 2011.

F-75

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

4. Merger Agreement (Continued)

In addition, the Merger Agreement may be terminated by Parent in the event that the Company's board of directors changes its recommendation. The Company may terminate the Merger Agreement in order to enter into a superior acquisition proposal. The Company may also terminate the Merger agreement if all of the conditions precedent to Parent's obligation to close have been satisfied or waived (other than conditions that by their terms are to be satisfied at the closing) and Parent does not complete the closing by the required date.

        The Company has agreed to pay a termination fee upon termination of the merger agreement if, among other things, (i) Parent terminates the merger agreement due to a recommendation change by the Company's board of directors, (ii) either party terminates the merger agreement because of the failure to obtain stockholder approval and before termination, the Company's board of directors changes its recommendation, or (iii) the Company terminates the merger agreement to enter into a superior acquisition proposal. If the merger agreement is terminated in connection with a superior acquisition proposal, then the termination fee payable by the Company is $13 million. A termination by Parent following a change of recommendation resulting from certain events, circumstances or developments unknown or not understood as of the date of the merger agreement results in a termination fee of $15 million. In addition, if the termination by Parent following a change in recommendation resulting from certain events, circumstances or developments unknown or not understood as of the date of the merger agreement occurs after the stockholder meeting to approve the merger agreement and the stockholders fail to approve the merger agreement, the Company will also be required to reimburse up to $2.5 million of Parent's fees and expenses.

        If the Company terminates the merger agreement under certain circumstances (including Parent's failure to consummate the merger by the required date following satisfaction or waiver of all conditions precedent to Parent's obligation to close (other than conditions that by their terms are to be satisfied at the closing)), Parent must pay the Company a termination fee of $22.5 million; provided that this termination fee will be increased to $27.5 million if Parent has committed willful breach of the merger agreement.

Other Merger-Related Transactions

        In connection with the Merger, Communications & Power Industries, Inc. has offered to purchase all $117.0 million aggregate principal amount of its existing outstanding 8% Senior Subordinated Notes due 2012 (the "8% Notes"), and CPII has offered to purchase all $12.0 million aggregate principal amount of its existing outstanding Floating Rate Senior Notes due 2015 (the "FR Notes") pursuant to tender offers and related consent solicitations. The outstanding consents required to approve the proposed amendments to the indenture governing the 8% Notes and the FR Notes have been received. Any 8% Notes not tendered will be redeemed according to the terms of the indenture governing the 8% Notes. All holders of the FR Notes have validly tendered their notes and consents.

        At the closing of the Merger, the Company expects to refinance its existing senior credit facility. Parent has received an equity commitment letter from the Veritas Fund pursuant to which the Veritas Fund has committed to invest, or have its affiliates invest, up to $220.0 million, plus certain additional amounts, solely for the purpose of purchasing equity securities of an indirect parent of CPI International Acquisition, Inc. in order to provide a portion of the financing required for the Merger

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CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

4. Merger Agreement (Continued)

and the other transactions contemplated by the Merger Agreement. Actual funding from the Veritas Fund and its affiliates will depend on, among other things, the amount of the Company's cash balances at the Merger closing date.

        In addition, the remainder of the funding for the Merger, the associated refinancing of the Company's debt and fees and expenses is expected to come from a $215.0 million aggregate principal amount note offering by Parent and a new credit facility for Parent consisting of a $150.0 million six-year term loan facility and a $30.0 million five-year revolving credit facility.

Strategic Alternative Transaction Expenses

        The Company incurred during the first quarter of fiscal year 2011 non-recurring transaction costs, reported as "strategic alternative transaction expenses" in the condensed consolidated statement of income and comprehensive income, in the amount of $2.7 million. Such transaction expenses comprised fees for investment bankers, attorneys and other professional services rendered in connection with the sale of the Company, including the Merger.

5. Financial Instruments

        The Company's non-financial assets (including goodwill, intangible assets, inventories and long-lived assets) and liabilities are measured at fair value on a non-recurring basis; that is, the assets and liabilities are not measured at fair value on an ongoing basis but are subject to fair value adjustments in certain circumstances such as when they are deemed to be other-than-temporarily impaired. The fair values of these non-financial assets and liabilities are determined based on valuation techniques using the best information available, and may include quoted market prices, market comparables, and discounted cash flow projections. An impairment charge is recorded when the cost exceeds its fair value and this condition is determined to be other-than-temporary. During the first quarter of fiscal years 2011 and 2010, no fair value adjustments or material fair value measurements were required for the Company's non-financial assets or liabilities.

        The Company measures certain financial assets and liabilities at fair value on a recurring basis, including cash equivalents, restricted cash, available-for-sale securities and derivative instruments. As of December 31, 2010, financial assets utilizing Level 1 inputs included cash equivalents, such as money market and overnight U.S. Government securities and available-for-sale securities, such as mutual funds. Financial assets and liabilities utilizing Level 2 inputs included foreign currency derivatives and interest rate swap derivatives. The Company does not have any financial assets or liabilities requiring the use of Level 3 inputs.

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CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

5. Financial Instruments (Continued)

        The following tables set forth financial instruments carried at fair value within the ASC 825 hierarchy:

				Fair Value Measurements at December 31, 2010 Using
		Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Money market and overnight U.S. Government securities(1)		$	46,401	$	46,401	$	—	$	—
Mutual funds(2)			185		185		—		—
Foreign exchange forward derivatives(3)			739		—		739		—
	Total assets at fair value	$	47,325	$	46,586	$	739		—
Liabilities:
Interest rate swap derivative(4)		$	493	$	—	$	493	$	—
	Total liabilities at fair value	$	493	$	—	$	493	$	—

(1)

The money market and overnight U.S. Government securities are classified as part of cash and cash equivalents and restricted cash in the condensed consolidated balance sheet.

(2)

The mutual funds are classified as part of other long-term assets in the condensed consolidated balance sheet.

(3)

The foreign currency derivatives are classified as part of prepaid and other current assets in the condensed consolidated balance sheet.

(4)

The interest rate swap derivatives are classified as part of accrued expenses in the condensed consolidated balance sheet.

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and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

5. Financial Instruments (Continued)

				Fair Value Measurements at October 1, 2010 Using
		Total		Quoted Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)		Significant Unobservable Inputs (Level 3)
Assets:
Money market and overnight U.S. Government securities(1)		$	36,420	$	36,420	$	—	$	—
Mutual funds(2)			171		171		—		—
Foreign exchange forward derivatives(3)			437		—		437		—
	Total assets at fair value	$	37,028	$	36,591	$	437		—
Liabilities:
Interest rate swap derivative(4)		$	816	$	—	$	816	$	—
	Total liabilities at fair value	$	816	$	—	$	816	$	—

(1)

The money market and overnight U.S. Government securities are classified as part of cash and cash equivalents and restricted cash in the condensed consolidated balance sheet.

(2)

The mutual funds are classified as part of other long-term assets in the condensed consolidated balance sheet.

(3)

The foreign currency derivatives are classified as part of prepaid and other current assets in the condensed consolidated balance sheet.

(4)

The interest rate swap derivatives are classified as part of accrued expenses in the condensed consolidated balance sheet.

Investments Other Than Derivatives

        In general and where applicable, the Company uses quoted prices in active markets for identical assets or liabilities to determine fair value. This pricing methodology applies to the Company's Level 1 investments, such as money market, U.S. Government securities and mutual funds.

        If quoted prices in active markets for identical assets or liabilities are not available to determine fair value, then the Company would use quoted prices for similar assets and liabilities or inputs other than the quoted prices that are observable either directly or indirectly. These investments would be included in Level 2.

Derivatives

        The Company executes foreign exchange forward contracts to purchase Canadian dollars and holds a pay-fixed receive-variable interest rate swap contract, all executed in the retail market with its relationship banks. To determine the most appropriate value, the Company uses an in-exchange

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and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

5. Financial Instruments (Continued)

valuation premise which considers the assumptions that market participants would use in pricing the derivatives. The Company has elected to use the income approach and uses observable (Level 2) market expectations at the measurement date and standard valuation techniques to convert future amounts to a single present amount. Level 2 inputs for derivative valuations are midmarket quoted prices for similar assets or liabilities in active markets and inputs other than quoted prices that are observable for the asset or liability.

        Key inputs for currency derivatives are spot rates, forward rates, interest rates and credit derivative rates. The spot rate for the Canadian dollar is the same spot rate used for all balance sheet translations at the measurement date. Forward premiums/discounts and interest rates are interpolated from commonly quoted intervals. Once valued, each forward is identified as either an asset or liability. Assets are further discounted using counterparty annual credit default rates, and liabilities are valued using the Company's credit as reflected in the spread paid over LIBOR on the term loan under the Company's senior credit facilities.

        Key inputs for valuing the interest rate swap are the cash rates used for the short term (under 3 months), futures rates for up to three years and LIBOR swap rates for periods beyond. These inputs are used to derive variable resets for the swap as well as to discount future fixed and variable cash flows to present value at the measurement date. A credit spread is used to further discount each net cash flow using, for assets, counterparty credit default rates and, for liabilities, the Company's credit spread over LIBOR on the term loan under the Company's senior credit facilities.

        See Note 7 for further information regarding the Company's derivative instruments.

Other Financial Instruments

        The Company's other financial instruments include cash, restricted cash, accounts receivable, accounts payable and long-term debt. Except for long-term debt, the carrying value of these financial instruments approximates fair values because of their relatively short maturity.

        The fair values of the Company's long-term debt were estimated using quoted market prices where available. For long-term debt not actively traded, fair values were estimated using discounted cash flow analyses, based on the Company's current estimated incremental borrowing rates for similar types of borrowing arrangements. The estimated fair value of the Company's long-term debt as of December 31, 2010 and October 1, 2010 was $194.0 million and $192.6 million, respectively, compared to the carrying value of $194.9 million as of both dates.

6. Senior Credit Facilities Agreement Amendment

        In November 2010, Communications & Power Industries entered into Amendment and Waiver No. 1 (the "Amendment") to its Senior Credit Facilities. The Senior Credit Facilities will mature and become due and payable on August 1, 2011 if CPI does not refinance or repay its 8% Senior Subordinated Notes prior to such date. The Amendment effects several technical changes to the Senior Credit Facilities including, among other items: (1) as a result of the potential maturity of the credit agreement on August 1, 2011, Communications & Power Industries is not currently permitted to have letters of credit under the credit agreement which extend beyond July 27, 2011; the Amendment

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CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

6. Senior Credit Facilities Agreement Amendment (Continued)

permits Communications & Power Industries to obtain letters of credit outside the credit agreement (including depositing cash with the issuing banks to secure its obligations under those letters of credit) provided that the total amount of letters of credit that Communications & Power Industries may have outstanding at any time shall not exceed $10 million in the aggregate; (2) the Amendment clarifies that entering into a merger agreement and an associated voting agreement would not trigger defaults under the credit agreement. The Company paid $0.4 million for the Senior Credit Facilities agreement amendment. This amount is included in deferred debt issue costs, net in the condensed consolidated balance sheet as of December 31, 2010.

7. Derivative Instruments and Hedging Activities

        Foreign Exchange Forward Contracts:    Although the majority of the Company's revenue and expense activities are transacted in U.S. dollars, the Company does transact business in foreign countries. The Company's primary foreign currency cash flows are in Canada and several European countries. In an effort to reduce its foreign currency exposure to Canadian dollar denominated expenses, the Company enters into Canadian dollar forward contracts to hedge the Canadian dollar denominated costs for its manufacturing operation in Canada. The Company does not engage in currency speculation.

        The Company's Canadian dollar forward contracts in effect as of December 31, 2010 have durations of 3 to 12 months. These contracts are designated as a cash flow hedge and are considered highly effective, as defined by FASB ASC 815, "Derivatives and Hedging." Unrealized gains and losses from foreign exchange forward contracts are included in accumulated other comprehensive income in the condensed consolidated balance sheets. At December 31, 2010, the unrealized gain, net of tax of $0.3 million, was $0.6 million. The Company anticipates recognizing the entire unrealized gain or loss in operating earnings within the next four fiscal quarters. Changes in the fair value of foreign currency forward contracts due to changes in time value are excluded from the assessment of effectiveness and are immediately recognized in general and administrative expenses in the consolidated statements of income. The time value was not material for the first quarter of fiscal years 2011 and 2010. If the transaction being hedged fails to occur, or if a portion of any derivative is ineffective, then the Company immediately recognizes the gain or loss on the associated financial instrument in general and administrative in the consolidated statements of income. No ineffective amounts were recognized due to hedge ineffectiveness in the first quarter of fiscal year 2011. The gain recognized in general and administrative due to hedge ineffectiveness was insignificant for the first quarter of fiscal year 2010.

        As of December 31, 2010, the Company had entered into Canadian dollar forward contracts for approximately $18.9 million (Canadian dollars), or approximately 53% of estimated Canadian dollar denominated expenses for January 2011 through September 2011, at an average rate of approximately 0.96 U.S. dollar to Canadian dollar.

        Interest Rate Contracts:    The Company also uses derivative instruments in order to manage interest costs and risk associated with its long-term debt. During fiscal year 2007, the Company entered into an interest rate swap contract (the "2007 Swap") to receive three-month USD-LIBOR-BBA (British Bankers' Association) interest and pay 4.77% fixed rate interest. Net interest positions are settled quarterly. The Company has structured the 2007 Swap with decreasing notional amounts such that it is

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CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

7. Derivative Instruments and Hedging Activities (Continued)

less than the balance of its term loan under its senior credit facilities. The notional value of the 2007 Swap was $25.0 million at December 31, 2010 and represented approximately 38% of the aggregate term loan balance. The Swap agreement is effective through June 30, 2011. Under the provisions of ASC 815, this arrangement was initially designated and qualified as an effective cash flow hedge of interest rate risk related to the term loan, which permitted recording the fair value of the 2007 Swap and corresponding unrealized gain or loss to accumulated other comprehensive income in the consolidated balance sheets. At December 31, 2010, the unrealized loss, net of tax of $0.2 million, was $0.3 million. The interest rate swap gain or loss is included in the assessment of hedge effectiveness. Gains and losses representing hedge ineffectiveness are immediately recognized in interest expense, net in the consolidated statements of income.

        See Note 5, Financial Instruments, for further information regarding the Company's derivative instruments.

        The following table summarizes the fair value of derivative instruments designated as cash flow hedges at December 31, 2010 and October 1, 2010:

	Asset Derivatives					Liabilities Derivatives
		Fair Value					Fair Value
	Balance Sheet Location	December 31, 2010		October 1, 2010		Balance Sheet Location	December 31, 2010		October 1, 2010
Derivatives designated as hedging instruments
Interest rate contracts						Accrued expenses	$	493	$	816
Forward contracts	Prepaid and other current assets	$	739	$	437
Total derivatives designated as hedging instruments		$	739	$	437		$	493	$	816

        As of December 31, 2010 and October 1, 2010, all of the Company's derivative instruments were classified as hedging instruments under ASC 815.

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CPI INTERNATIONAL, INC.
and Subsidiaries
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

7. Derivative Instruments and Hedging Activities (Continued)

        The following table summarizes the effect of derivative instruments on the condensed consolidated statements of income and comprehensive income for the first quarter of fiscal years 2011 and 2010:

Derivatives in Cash Flow Hedging Relationships	Amount of Gain (Loss) Recognized in OCI on Derivative (Effective Portion)					Location of (Loss) Gain Reclassified from Accumulated OCI into Income (Effective Portion)	Amount of (Loss) Gain Reclassified from Accumulated OCI into Income (Effective Portion)						Location of (Loss) Gain Recognized in Income on Derivative (Ineffective and Excluded Portion)	Amount of (Loss) Gain Recognized in Income on Derivative (Ineffective and Excluded Portion)
	Quarter Ended						Quarter Ended							Quarter Ended
	December 31, 2010		January 1, 2010				December 31, 2010			January 1, 2010				December 31, 2010			January 1, 2010
Interest rate contracts	$	46	$	(84	)	Interest expense, net	$	(277	)	$	(550	)	Interest expense, net	$	(5	)	$	(10	)
Forward contracts		507		752		Cost of sales		504			(75	)	General and administrative(a)		33			2
						Research and development		51			39
						Selling and marketing		22			17
						General and administrative		30			22
Total	$	553	$	668			$	330		$	(547	)		$	(28	)	$	(8	)

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CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

7. Derivative Instruments and Hedging Activities (Continued)

        As a result of the use of derivative instruments, the Company is exposed to the risk that counterparties to derivative contracts will fail to meet their contractual obligations. The Company does not hold collateral or other security from its counterparties supporting its derivative instruments. To mitigate the counterparty credit risk, the Company has a policy of only entering into contracts with carefully selected major financial institutions based upon their credit ratings and other factors. The Company regularly reviews its credit exposure balances as well as the creditworthiness of its counterparties.

        When the Company's derivatives are in a net asset position, such as the case with the Company's forward foreign exchange contract derivatives at December 31, 2010, the Company is exposed to credit loss from nonperformance by the counterparty. If the counterparty fails to perform, credit risk with such counterparty is equal to the extent of the fair value gain in the derivative. At December 31, 2010, the Company's interest rate contract derivatives were in a liability position, and the Company, therefore, was not exposed to the interest rate contract counterparty credit risk.

8. Commitments and Contingencies

        Leases:    The Company is committed to minimum rentals under non-cancelable operating lease agreements, primarily for land and facility space, that expire on various dates through 2050. Certain of the leases provide for escalating lease payments. Future minimum lease payments for all non-cancelable operating lease agreements at December 31, 2010 were as follows:

Fiscal Year	Operating Leases
2011 (remaining nine months)	$	1,173
2012		1,301
2013		882
2014		467
2015		287
Thereafter		2,375
	$	6,485

        Real estate taxes, insurance, and maintenance are also obligations of the Company. Rental expense under non-cancelable operating leases amounted to $0.7 million for the first quarter of fiscal years 2011 and 2010. Assets subject to capital leases at December 31, 2010 and October 1, 2010 were not material.

        Guarantees:    The Company has restricted cash of $3.1 million and $1.8 million as of December 31, 2010 and October 1, 2010, respectively, consisting of bank guarantees from customer advance payments to the Company's international subsidiaries and cash collateral for certain performance bonds. The bank guarantees become unrestricted cash when performance under the sales or supply contract is complete. The cash collateral for the performance bonds will become unrestricted cash when the performance bonds expire.

        Purchase commitments:    As of December 31, 2010, the Company had the following known purchase commitments, which include primarily future purchases for inventory-related items under various purchase arrangements as well as other obligations in the ordinary course of business that the

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CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

8. Commitments and Contingencies (Continued)

Company cannot cancel or where it would be required to pay a termination fee in the event of cancellation:

Fiscal Year	Purchase Contracts
2011 (remaining nine months)	$	29,674
2012		2,482
2013		—
2014		—
2015		—
Thereafter	$	32,156

        Contingencies:    From time to time, the Company may be subject to claims that arise in the ordinary course of business. Except as noted below, in the opinion of management, all such matters involve amounts that would not have a material adverse effect on the Company's consolidated financial position if unfavorably resolved.

        On July 1, 2010, a putative stockholder class action complaint was filed against the Company, the members of the Company's board of directors, and Comtech Telecommunications Corp. ("Comtech") in the Superior Court of the State of California in and for the County of Santa Clara, entitled Continuum Capital v. Michael Targoff, et al. (Case No. 110CV175940). The lawsuit concerned the proposed merger between the Company and Comtech, and generally asserted claims alleging, among other things, that each member of the Company's board of directors breached his fiduciary duties by agreeing to the terms of the previously proposed merger and by failing to provide stockholders with allegedly material information related to the proposed merger, and that Comtech aided and abetted the breaches of fiduciary duty allegedly committed by the members of the Company's board of directors. The lawsuit sought, among other things, class action certification and monetary relief. On July 28, 2010, the plaintiff filed an amended complaint, making generally the same claims against the same defendants, and seeking the same relief. In addition, the amended complaint generally alleged that the consideration that would have been paid to the Company's stockholders under the terms of the proposed merger was inadequate. On September 7, 2010, the Company terminated the Comtech sale agreement. On November 24, 2010, as described in Note 4, the Company entered into an agreement and plan of merger with Merger Sub and CPI International Acquisition, Inc. (formerly Catalyst Holdings, Inc.), which are affiliates of the Veritas Fund. On December 15, 2010, the plaintiff filed a second amended complaint, which removed Comtech as a defendant, added allegations related to the Merger and to the Veritas Fund, and added a claim for attorneys' fees. On December 23, 2010, after the Company filed its preliminary proxy statement relating to a special meeting in connection with the approval of the Merger, the plaintiff filed a third amended complaint, adding allegations related to the disclosures in the preliminary proxy statement. The third amended complaint seeks, among other things, class action certification and monetary relief.

        The Company believes the action is without merit; however, to avoid the cost and uncertainty of litigation and to complete the proposed merger without delay, the defendants have entered into a Memorandum of Understanding concerning settlement. The settlement and any attorneys' fees award are subject to Court approval. Pursuant to the Memorandum of Understanding, among other things, the defendants will receive a release of claims and the plaintiff will dismiss the third amended

F-85

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

8. Commitments and Contingencies (Continued)

complaint with prejudice in exchange for, among other agreements, an agreement by the Company to make certain additional disclosures concerning the Merger, which disclosures have been included in a definitive proxy statement mailed to stockholders on or about January 12, 2011. The Memorandum of Understanding also provides that, upon Court approval and dismissal of the action, the Company, its insurers or its successor in interest will cause to be paid to the plaintiff's counsel approximately $0.6 million in full settlement of any claim for attorneys' fees and all expenses. The Company expects $0.4 million of this payment to be borne by its insurance carrier. The $0.6 million full settlement and the $0.4 million insurance reimbursement are included in accrued liabilities and prepaid and other current assets, respectively, in the condensed consolidated balance sheet as of December 31, 2010.

        During fiscal year 2009, the Company received a notice from a customer purporting to terminate a sales contract due to alleged nonperformance. In April and June 2010, the Company received notices from the customer claiming additional cost incurred due to the alleged nonperformance. The customer has initiated arbitration and filed a claim for damages of approximately $2.1 million. The Company has filed a counterclaim for damages of approximately $0.8 million. The Company plans to contest this matter vigorously. At this time, the Company believes that any loss or gain with respect to this matter will not have a material effect on its consolidated results of operations and cash flows.

        All legal costs are expensed as incurred.

9. Stock-based Compensation Plans

        Stock Options:    The following table summarizes the status of the Company's stock option awards as of December 31, 2010 and October 1, 2010 and of changes during the first quarter of fiscal year 2011 under the Company's stock option plans:

	Outstanding Options									Exercisable Options
	Number of Shares			Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (Years)		Aggregate Intrinsic Value		Number of Shares		Weighted- Average Exercise Price		Weighted- Average Remaining Contractual Term (Years)		Aggregate Intrinsic Value
Balance at October 1, 2010		3,347,192		$	6.60		4.24	$	26,801		2,915,483	$	5.61		3.76	$	25,930
Granted		108,000			19.33
Exercised		(17,657	)		7.72
Forfeited or cancelled		—			—
Balance at December 31, 2010		3,437,535		$	7.00		4.18	$	42,462		3,081,368	$	6.06		3.72	$	40,960

        The aggregate intrinsic value in the preceding table represents the total intrinsic value, based on the Company's closing stock price of $19.35 as of December 31, 2010, which would have been received by the option holders had all option holders exercised their options and sold the shares received upon such exercises as of that date. As of December 31, 2010, approximately 3.1 million exercisable options were in-the-money.

        During the first quarter of fiscal year 2011, cash received from option exercises was approximately $0.1 million, and the total intrinsic value of options exercised was $0.2 million. During the first quarter of fiscal year 2010, cash received from option exercises was approximately $13,500, and the total intrinsic value of options exercised was $21,697. As of December 31, 2010, there was approximately

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CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

9. Stock-based Compensation Plans (Continued)

$2.5 million of total unrecognized compensation costs related to nonvested stock options, which is expected to be recognized over a weighted-average vesting period of 1.9 years.

        Stock Purchase Plan:    Employees purchased approximately 13,000 shares in the first quarter of fiscal year 2011 for $0.2 million and approximately 17,000 shares in the first quarter of fiscal year 2010 for $0.2 million under the 2006 Employee Stock Purchase Plan (the "2006 ESPP"). As of December 31, 2010, there were no unrecognized compensation costs related to rights to acquire stock under the Company's stock purchase plan.

        Restricted Stock and Restricted Stock Units:    There were 425,266 and 310,341 shares outstanding of nonvested restricted stock and restricted stock units granted to directors and employees as of December 31, 2010 and October 1, 2010, respectively. The restricted stock and restricted stock units generally vest over periods of one to four years. Upon vesting, each restricted stock unit will automatically convert into one share of common stock of CPI International.

        A summary of the status of the Company's nonvested restricted stock and restricted stock unit awards as of December 31, 2010 and October 1, 2010 and of changes during the first quarter of fiscal year 2011 is presented below:

	Number of Shares			Weighted-Average Grant-Date Fair Value Per Share
Nonvested at October 1, 2010		310,341		$	10.51
Granted		138,700		$	19.33
Vested		(23,775	)	$	15.18
Forfeited		—		$	—
Nonvested at December 31, 2010		425,266		$	13.13

        During the first quarter of fiscal year 2011, the Company granted 102,700 restricted stock units with time vesting criteria to certain of its non-executive employees and 36,000 restricted stock units with performance vesting criteria to its executive officers. The performance conditions are based on the achievement of specified EBITDA (earnings before net interest expense, provision for income taxes and depreciation and amortization) levels over a period of four years.

        Aggregate intrinsic value of the nonvested restricted stock and restricted stock unit awards at December 31, 2010 and October 1, 2010 was $8.2 million and $4.4 million, respectively. As of December 31, 2010, there was $4.6 million of unrecognized compensation costs related to restricted stock and restricted stock unit awards. The unrecognized compensation cost is expected to be recognized over a weighted average period of 3.2 years.

        The Company settles stock option exercises and restricted stock units with newly issued common shares.

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CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

9. Stock-based Compensation Plans (Continued)

Valuation and Expense Information

        Stock Options.    The fair value of the Company's stock options granted during the first quarter of fiscal years 2011 and 2010 was estimated on the date of grant using the Black-Scholes model with the following assumptions:

	Quarter Ended
	December 31, 2010			January 1, 2010
Expected term (in years)		8.14			7.79
Expected volatility		60.91	%		60.50	%
Risk-free rate		2.57	%		3.00	%
Dividend yield		0	%		0	%

        The weighted-average grant-date fair value of all the options granted during the first quarter of fiscal years 2011 and 2010 was $12.65 and $6.25 per share, respectively.

        Stock Purchase Plan.    Based on the 15% discount received by the employees, the weighted-average fair value of shares issued under the 2006 ESPP was $2.90 and $1.99 per share during the first quarter of fiscal years 2011 and 2010, respectively.

        Restricted Stock and Restricted Stock Units.    The fair value of each time-based restricted stock and restricted stock unit award and each of performance-based restricted stock unit award is calculated using the market price of the Company's common stock on the date of grant. The fair value of each performance-based restricted stock unit award assumes that the relevant performance criteria will be met and the target payout level will be achieved. Compensation cost is adjusted for subsequent changes in the outcome of performance-related conditions until the award vests.

        The weighted-average estimated fair value of all restricted stock and restricted stock units granted during the first quarter of fiscal years 2011 and 2010 was $19.33 and $9.66 per share, respectively.

        As stock-based compensation expense recognized in the condensed consolidated statements of income and comprehensive income for the first quarter of fiscal years 2011 and 2010 is based on awards ultimately expected to vest, it has been reduced for estimated forfeitures. FASB ASC 718, "Compensation—Stock Compensation," requires forfeitures to be estimated at the time of grant and revised, if necessary, in subsequent periods if actual forfeitures differ from those estimates.

F-88

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

9. Stock-based Compensation Plans (Continued)

        The following table summarizes stock-based compensation expense for the first quarter of fiscal years 2011 and 2010, which was allocated as follows:

		Quarter Ended
		December 31, 2010		January 1, 2010
Share-based compensation cost recognized in the income statement by caption:
	Cost of sales	$	152	$	133
	Research and development		55		49
	Selling and marketing		77		73
	General and administrative		506		475
		$	790	$	730
Share-based compensation cost capitalized in inventory		$	163	$	141
Share-based compensation cost remaining in inventory at end of period		$	108	$	94
Share-based compensation expense by type of award:
	Stock options	$	428	$	456
	Restricted stock and units		327		241
	Stock purchase plan		35		33
		$	790	$	730

        The tax benefit realized from option exercises and restricted stock vesting totaled approximately $0.2 million and $0.1 million during the first quarter of fiscal years 2011 and 2010, respectively.

Effect of the Pending Merger on Stock Options, Restricted Stock and Restricted Stock Units

        Pursuant to the Company's pending merger with Merger Sub described in Note 4, subject to certain exceptions described below, unvested options to purchase the Company's common stock will become fully vested immediately prior to the effective time of the merger ("Effective Time"), and at (or, in the case of certain option holders, immediately after) the Effective Time, outstanding unexercised stock options will be cancelled in exchange for a cash payment in an amount equal to the product of (x) the number of shares subject to the option and (y) the excess, if any, of (A) $19.50 over (B) the exercise price per share subject to the option, less any applicable taxes. Subject to certain exceptions described below, each share of the Company's restricted stock and each of the Company's restricted stock unit outstanding immediately prior to the Effective Time will vest in full and entitle the holder to receive $19.50 in cash, less applicable taxes. With respect to options and restricted stock units granted in the first quarter of fiscal year 2011, only 25% of such options and restricted stock units will become vested upon the closing of the merger and the remaining 75% will be cancelled. The Company will account for the acceleration of vesting of stock options, restricted stock and restricted stock units in conjunction with a business combination in accordance with ASC 718.

F-89

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

10. Income Taxes

        The income tax expense of $1.0 million and $1.9 million for the first quarter of fiscal years 2011 and 2010, respectively, reflect estimated federal, foreign and state taxes. The effective tax rate for the first quarter of fiscal year 2011 was 30% and diverged from the combined federal and state statutory tax rate primarily because of Canadian foreign tax credits and a $0.2 million fiscal year 2010 discrete R&D tax benefit. The discrete benefit was a result of the retroactive extension of the R&D tax credit to calendar year 2010 through the enactment of the Tax Relief, Unemployment Insurance Authorization and Job Creation Act of 2010, signed into law on December 17, 2010. The effective tax rate for the first quarter of fiscal year 2010 was 33% and diverged from the combined federal and state statutory rate primarily because of Canadian foreign tax credits and a $0.3 million discrete tax benefit resulting from reduced Canadian deferred tax liabilities due to a reduction in the Ontario, Canada corporate tax rate effective December 15, 2009.

        Consistent with FASB ASC 805, "Business Combinations," acquisition-related costs have been charged to expense in the period when the related services are rendered, although these costs may not be immediately deductible for tax purposes. For income tax reporting purposes, the company recorded a $1.1 million income tax benefit and deferred tax asset for all $2.7 million of strategic alternative expenses that were incurred in the first quarter of fiscal year 2011 without assuming that a business combination will ultimately occur. If the anticipated Merger is consummated, it may be determined that a portion of or all of the strategic alternative expenses are not deductible which would result in a charge to income tax expense upon consummation of the Merger.

        The Company files a U.S. federal income tax return and state income tax returns in California, Massachusetts and several other U.S. states. The Company also files income tax returns in Canada and other foreign jurisdictions. In most of these jurisdictions, fiscal years 2006 to 2009 remain open to examination by the various taxing authorities. The Company has not been audited for U.S. federal income tax matters. The Company has income tax audits in progress in Canada and in several international jurisdictions in which it operates. The years under examination by the Canadian tax authorities are fiscal years 2001 and 2002. The total unrecognized tax benefit, which excludes any related interest accruals, was $6.8 million as of December 31, 2010. Of the total unrecognized tax benefit balance, $6.3 million of unrecognized tax benefits would reduce the effective tax rate if recognized as of December 31, 2010. Estimated interest and penalties related to the underpayment of income taxes are classified as a component of tax expense in the condensed consolidated statement of income and comprehensive income and totaled approximately $0.1 million for the first quarter of fiscal year 2011. Accrued interest and penalties, net of interest benefits accrued on receivables anticipated as a result of the change in the U.S.-Canada treaty, were approximately $0.9 million as of December 31, 2010. The Company has minimal penalties accrued in income tax expense.

        The Company believes that it is reasonably possible that, in the next 12 months, the amount of unrecognized tax benefits related to the resolution of federal, state and foreign matters could be reduced by $2.9 million as audits close, statutes expire and tax payments are made. Any prospective adjustments to the Company's unrecognized tax benefits will be recorded as an increase or decrease to income tax expense and cause a corresponding change to the Company's effective tax rate. Accordingly, the Company's effective tax rate could fluctuate materially from period to period.

F-90

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

11. Earnings Per Share

        Earnings per share is computed using the two-class method, which is an earnings allocation method for computing earnings per share that treats a participating security as having rights to earnings that would otherwise have been available to common stockholders. Certain of the Company's stock-based compensation awards pay nonforfeitable dividends to the participants during the vesting period and, as such, are deemed participating securities. Basic earnings per share are computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding during the period. Diluted earnings per share is computed by dividing net income available to common stockholders by the weighted average number of common shares outstanding that are increased for additional shares that would be outstanding if potentially dilutive non-participating securities were converted to common shares, pursuant to the treasury stock method.

        Earnings per share for the respective periods were calculated as follows (amounts and shares in thousands, except per share data):

	Quarter Ended
	December 31, 2010			January 1, 2010
Basic Earnings per Share
Net income	$	2,222		$	3,841
Income allocated to participating securities		(46	)		(57	)
Net income available to common shareholders	$	2,176		$	3,784
Basic weighted average common shares outstanding		16,695			16,452
Net income per common share—Basic	$	0.13		$	0.23
Diluted Earnings per Share
Net income	$	2,222		$	3,841
Income allocated to participating securities		(42	)		(57	)
Net income available to common shareholders	$	2,180		$	3,784
Basic weighted average common shares outstanding		16,695			16,452
Effect of dilutive stock options		1,381			1,178
Diluted weighted averages common shares outstanding		18,076			17,630
Net income per common share—Diluted	$	0.12		$	0.21

        The calculation of diluted net income per share excludes all anti-dilutive shares from stock options. For the first quarter of fiscal years 2011 and 2010, the number of anti-dilutive stock options, as calculated based on the weighted average closing price of the Company's common stock for the periods, was approximately 0.5 million and 0.9 million shares, respectively.

12. Segments, Geographic and Customer Information

        The Company's reportable segments are VED and satcom equipment. The VED segment develops, manufactures and distributes high-power/high-frequency microwave and radio frequency signal components. The satcom equipment segment manufactures and supplies high-power amplifiers and

F-91

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

12. Segments, Geographic and Customer Information (Continued)

networks for satellite communication uplink, electronic warfare and industrial applications. Segment information reported below is consistent with the manner in which it is reviewed and evaluated by the Company's chief operating decision maker ("CODM"), its chief executive officer, and is based on the nature of the Company's operations and products offered to customers.

        Amounts not reported as VED or satcom equipment are reported as Other. In accordance with quantitative and qualitative guidelines established by FASB ASC 280, "Segment Reporting." Other includes the activities of the Company's Malibu division and unallocated corporate expenses, such as strategic alternative transaction expenses, share-based compensation expense and certain non-recurring or unusual expenses. The Malibu division is a designer, manufacturer and integrator of advanced antenna systems for radar, radar simulators and telemetry systems, as well as for data links used in ground, airborne, unmanned aerial vehicles ("UAVs") and shipboard systems.

        Summarized financial information concerning the Company's reportable segments is shown in the following tables:

		Quarter Ended
		December 31, 2010			January 1, 2010
Sales from external customers
	VED	$	62,863		$	59,077
	Satcom equipment		20,731			20,127
	Other		5,426			3,563
		$	89,020		$	82,767
Intersegment product transfers
	VED	$	5,807		$	6,113
	Satcom equipment		36			—
		$	5,843		$	6,113
EBITDA
	VED	$	13,976		$	12,719
	Satcom equipment		2,008			2,728
	Other		(6,273	)		(3,080	)
		$	9,711		$	12,367

        EBITDA is the measure used by the CODM to evaluate segment profit or loss. EBITDA represents earnings before net interest expense, provision for income taxes and depreciation and amortization. The Company believes that EBITDA is a more meaningful representation of segment operating performance for leveraged businesses like its own and therefore uses this metric as its internal measure of profitability. For the reasons listed below, the Company believes EBITDA provides investors better understanding of the Company's financial performance in connection with their analysis of the Company's business:

•

EBITDA is a component of the measures used by the Company's board of directors and management team to evaluate the Company's operating performance;

F-92

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

12. Segments, Geographic and Customer Information (Continued)

•

the Company's Senior Credit Facilities contain a covenant that requires the Company to maintain a senior secured leverage ratio that contains EBITDA as a component, and the Company's management team uses EBITDA to monitor compliance with this covenant;

•

EBITDA is a component of the measures used by the Company's management team to make day-to-day operating decisions;

•

EBITDA facilitates comparisons between the Company's operating results and those of competitors with different capital structures and, therefore, is a component of the measures used by the Company's management to facilitate internal comparisons to competitors' results and the Company's industry in general; and

•

the payment of management bonuses is contingent upon, among other things, the satisfaction by the Company of certain targets that contain EBITDA as a component.

        Other companies may define EBITDA differently and, as a result, the Company's measure of EBITDA may not be directly comparable to EBITDA of other companies. Although the Company uses EBITDA as a financial measure to assess the performance of its business, the use of EBITDA is limited because it does not include certain material costs, such as interest and taxes, necessary to operate the Company's business. When analyzing the Company's performance, EBITDA should be considered in addition to, and not as a substitute for or superior to, operating income, net income, cash flows from operating activities or other statements of income or statements of cash flows data prepared in accordance with U.S. generally accepted accounting principles ("GAAP"). Operating income by the Company's reportable segments was as follows:

		Quarter Ended
		December 31, 2010			January 1, 2010
Operating income
	VED	$	12,425		$	11,232
	Satcom equipment		1,827			2,549
	Other		(7,364	)		(4,149	)
		$	6,888		$	9,632

        The following table reconciles net income to EBITDA:

		Quarter Ended
		December 31, 2010		January 1, 2010
Net income		$	2,222	$	3,841
	Depreciation and amortization		2,823		2,735
	Interest expense, net		3,711		3,881
	Income tax expense		955		1,910
EBITDA		$	9,711	$	12,367

F-93

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

13. Subsequent Events

        Pursuant to Merger Agreement described in Note 4, on February 11, 2011, Merger Sub merged with and into the Company, with the Company continuing as the surviving corporation and a wholly owned subsidiary of CPI International Acquisition, Inc., and the separate corporate existence of Merger Sub ceased (the "Merger"). The Company's common stock is no longer publicly traded as a result of the Merger. Immediately following the consummation of the Merger and related transactions, the Company was converted into a limited liability company and liquidated, and CPI International Acquisition, Inc. changed its name to CPI International, Inc. ("CPII").

        CPI International Holding LLC ("Holding LLC"), a Delaware limited liability company, owns all of the outstanding common stock of CPI International Holding Corp., (formerly Catalyst Holdings 2, Inc., "Parent"), a Delaware corporation, which in turn owns all of the outstanding common stock of CPII, which now in turn owns all of the outstanding equity interests of Communications & Power Industries LLC (formerly Communications & Power Industries, Inc., "CPI") and Communications & Power Industries Canada Inc., CPII's main operating subsidiaries.

        Pursuant to the terms of the Merger Agreement, each outstanding share of common stock of the Company was converted into the right to receive $19.50 in cash in the Merger. Subject to certain exceptions, each option to purchase shares of the Company's common stock that was granted under its equity compensation plans and outstanding immediately prior to the closing became vested and was canceled at (or shortly following) the closing in exchange for cash equal to the excess, if any, of (i) $19.50 reduced by (ii) the per-share exercise price of such option. Subject to certain exceptions, each restricted stock award and restricted stock unit granted under the Company's equity compensation plans outstanding immediately prior to the closing was canceled at the closing in exchange for a payment, in cash, equal to $19.50.

        In connection with the Merger, Veritas Fund and certain of its affiliates invested $200.0 million, solely for the purpose of purchasing equity securities of Holding LLC in order to provide a portion of the financing required for the Merger and the transactions contemplated by the Merger Agreement. Certain officers of the Company also invested in equity securities of Holding LLC in an aggregate amount of $11.1 million.

        On February 11, 2011, CPII entered into the senior secured credit facilities consisting of (i) a $150,000 six-year term loan facility; and (ii) a $30,000 five-year revolving credit facility (the "Senior Secured Credit Facilities"). CPII borrowed the full amount of the term loan thereunder, and the revolving credit facility was undrawn at closing (other than for approximately $4,500 of outstanding letters of credit). CPII has the option to increase the amount available under the Senior Secured Credit Facilities by up to an aggregate of $50,000 on an uncommitted basis.

        The revolving credit facility includes borrowing capacity available for letters of credit and for short-term borrowings referred to as the swing line borrowings. CPII's obligations under the Senior Secured Credit Facilities are fully and unconditionally guaranteed by Parent and, subject to certain exceptions, each of Parent's existing and future domestic restricted subsidiaries (other than CPII). In addition, CPII's obligations under the Senior Secured Credit Facilities and the guarantees of those obligations are secured by substantially all of CPII's assets and all of the assets of the guarantors, including but not limited to (a) pledges of all the equity interests held by CPII and each guarantor and (b) a first-priority security interest in, and mortgages on, substantially all of the present and after acquired assets of CPII and each guarantor, in each case subject to certain exceptions.

F-94

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

13. Subsequent Events (Continued)

        Borrowings under the term loan facility and the revolving credit facility bear interest, at CPII's option, at a rate equal to a margin over either (a) a base rate or (b) LIBOR. As of March 29, 2011, the term loan facility bears an interest rate of 4% margin over LIBOR of 1% or 5%. The Senior Secured Credit Facilities are subject to amortization and prepayment requirements and contain customary representations and warranties, covenants, events of default and other provisions.

        In addition, on February 11, 2011, CPII issued the $215 million aggregate principal amount of 8.00% Senior Notes due 2018 (the "Notes"). The Notes are CPII's senior unsecured obligations. Parent and, subject to certain exceptions, each of Parent's existing and future domestic restricted subsidiaries (other than CPII) guarantee the notes on a senior unsecured basis. The Notes bear interest at the rate of 8.0% per year. Subject to certain exceptions, the indenture governing the Notes limits Parent's and its restricted subsidiaries' ability to incur additional indebtedness or issue certain preferred stock; pay dividends and make other restricted payments; make certain investments; sell all or substantially all assets; create liens; consolidate, merge or sell all or substantially of the CPII's assets; enter into transactions with affiliates and designate subsidiaries as unrestricted subsidiaries; and contains customary events of default and other provisions.

        In addition, in connection with the Merger, on January 13, 2011, CPI offered to purchase all $117.0 million aggregate principal amount of its existing outstanding 8% Senior Subordinated Notes due 2012 (the "8% Notes"), and the Company offered to purchase all $12.0 million aggregate principal amount of its existing outstanding Floating Rate Senior Notes due 2015 (the "FR Notes") pursuant to tender offers and related consent solicitations. All outstanding FR Notes and a portion of the 8% Notes were tendered pursuant to such tender offers and purchased by the Company and CPI, respectively, on February 11, 2011. CPI redeemed all remaining outstanding 8% Notes on March 14, 2011.

        CPII used the equity contributions, borrowings under the term loan facility and the net proceeds from the Notes to pay the Merger consideration, consummate the tender offers and redemption in connection with the Merger and pay related fees and expenses..

14. Supplemental Guarantors Condensed Consolidating Financial Information

        The tables that follow reflect the supplemental guarantor financial information associated with CPII's newly issued 8.00% Senior Notes due 2018 (the "Notes"). As discussed in Note 13, Subsequent Events, the "Notes" are guaranteed by Parent and, subject to certain exceptions, each of Parent's existing and future domestic restricted subsidiaries (other than CPII) on a senior unsecured basis. Separate financial statements of the guarantor subsidiaries are not presented because (i) the guarantors are wholly owned and have fully and unconditionally guaranteed the Notes on a joint and several basis and (ii) CPII's management has determined that such separate financial statements are not material to investors. Instead, presented below are the consolidating financial statements of: (a) the guarantor subsidiaries (all of the domestic subsidiaries), (b) the non-guarantor subsidiaries, (c) the consolidating elimination entries, and (d) the consolidated totals. The accompanying consolidating financial information should be read in connection with the consolidated financial statements of the Company.

        Investments in subsidiaries are accounted for based on the equity method. The principal elimination entries eliminate investments in subsidiaries, intercompany balances, intercompany transactions and intercompany sales.

F-95

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

14. Supplemental Guarantors Condensed Consolidating Financial Information (Continued)

CONDENSED CONSOLIDATING BALANCE SHEET
As of December 31, 2010

		Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Eliminations			Consolidated Total
Assets
Cash and cash equivalents		$	39,250		$	20,657		$	—		$	59,907
Restricted cash			2,969			91			—			3,060
Accounts receivable, net			25,732			13,691			—			39,423
Inventories			57,188			21,901			(644	)		78,445
Deferred tax assets			11,729			158			—			11,887
Intercompany receivable			14,145			12,121			(26,266	)		—
Prepaid and other current assets			5,189			923			—			6,112
	Total current assets		156,202			69,542			(26,910	)		198,834
Property, plant and equipment, net			40,328			12,222						52,550
Deferred debt issue costs, net			1,344			—						1,344
Intangible assets, net			65,421			6,309						71,730
Goodwill			114,280			47,945						162,225
Other long-term assets			5,465			—						5,465
Investment in subsidiaries			104,542			—			(104,542	)		—
	Total assets	$	487,582		$	136,018		$	(131,452	)	$	492,148
Liabilities and stockholders' equity
Current portion of long-term debt		$	66,000		$	—					$	66,000
Accounts payable			11,961			10,234						22,195
Accrued expenses			24,822			5,015						29,837
Product warranty			3,722			1,696						5,418
Income taxes payable			722			2,800						3,522
Advance payments from customers			15,306			6,460						21,766
Intercompany payable			26,266			—			(26,266	)		—
	Total current liabilities		148,799			26,205			(26,266	)		148,738
Deferred income taxes			17,540			4,002						21,542
Long-term debt, less current portion			128,937			—						128,937
Other long-term liabilities			4,826			625						5,451
	Total liabilities		300,102			30,832			(26,266	)		304,668
Common stock			171			—						171
Parent investment			—			51,107			(51,107	)		—
Additional paid-in capital			81,235			—			—			81,235
Accumulated other comprehensive loss			(44	)		(187	)		187			(44	)
Retained earnings			108,918			54,266			(54,266	)		108,918
Treasury stock			(2,800	)		—			—			(2,800	)
	Total stockholders' equity		187,480			105,186			(105,186	)		187,480
	Total liabilities and stockholders' equity	$	487,582		$	136,018		$	(131,452	)	$	492,148

F-96

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

14. Supplemental Guarantors Condensed Consolidating Financial Information (Continued)

CONDENSED CONSOLIDATING BALANCE SHEET
As of October 1, 2010

		Guarantor Subsidiaries			Non-Guarantor Subsidiaries		Consolidating Eliminations			Consolidated Total
Assets
Cash and cash equivalents		$	30,336		$	12,493				$	42,829
Restricted cash			1,710			94					1,804
Accounts receivable, net			30,332			15,375					45,707
Inventories			54,814			21,070		(676	)		75,208
Deferred tax assets			10,947			83					11,030
Intercompany receivable			9,660			16,677		(26,337	)		—
Prepaid and other current assets			5,132			1,327					6,459
	Total current assets		142,931			67,119		(27,013	)		183,037
Property, plant and equipment, net			41,778			12,481					54,259
Deferred debt issue costs, net			1,604			—					1,604
Intangible assets, net			66,014			6,460					72,474
Goodwill			114,280			47,945					162,225
Other long-term assets			4,677			—					4,677
Investment in subsidiaries			102,577			—		(102,577	)		—
	Total assets	$	473,861		$	134,005	$	(129,590	)	$	478,276
Liabilities and stockholders' equity
Current portion of long-term debt		$	66,000		$	—				$	66,000
Accounts payable			13,562			10,728					24,290
Accrued expenses			18,438			5,215					23,653
Product warranty			3,449			1,652					5,101
Income taxes payable			699			4,323					5,022
Advance payments from customers			10,253			3,965					14,218
Intercompany payable			26,337			—		(26,337	)		—
	Total current liabilities		138,738			25,883		(26,337	)		138,284
Deferred income taxes			17,644			4,063					21,707
Long-term debt, less current portion			128,934			—					128,934
Other long-term liabilities			4,605			806					5,411
	Total liabilities		289,921			30,752		(26,337	)		294,336
Common stock			170			—		—			170
Parent investment			—			50,969		(50,969	)		—
Additional paid-in capital			80,015			—		—			80,015
Accumulated other comprehensive (loss) gain			(141	)		84		(84	)		(141	)
Retained earnings			106,696			52,200		(52,200	)		106,696
Treasury stock			(2,800	)		—		—			(2,800	)
	Total stockholders' equity		183,940			103,253		(103,253	)		183,940
	Total liabilities and stockholders' equity	$	473,861		$	134,005	$	(129,590	)	$	478,276

F-97

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(All tabular dollar amounts in thousands except share and per share amounts) (Continued)

14. Supplemental Guarantors Condensed Consolidating Financial Information (Continued)

CONDENSED CONSOLIDATING STATEMENT OF INCOME
For the Three Months Ended December 31, 2010

		Guarantor Subsidiaries		Non-Guarantor Subsidiaries			Consolidating Eliminations			Consolidated Total
Sales		$	69,397	$	38,356		$	(18,733	)	$	89,020
Cost of sales			53,586		29,278			(18,765	)		64,099
Gross profit			15,811		9,078			32			24,921
Operating costs and expenses:
	Research and development		831		2,299			—			3,130
	Selling and marketing		2,982		2,262			—			5,244
	General and administrative		4,592		1,724			—			6,316
	Amortization of acquisition-related intangible assets		535		151			—			686
	Strategic alternative transaction expenses		2,657		—			—			2,657
Total operating costs and expenses			11,597		6,436			—			18,033
Operating (loss) income			4,214		2,642			32			6,888
	Interest expense (income), net		3,714		(3	)		—			3,711
(Loss) income before income tax expense and equity in income of subsidiaries			500		2,645			32			3,177
	Income tax (benefit) expense		376		579			—			955
	Equity in income of subsidiaries		2,098		—			(2,098	)		—
Net income		$	2,222	$	2,066		$	(2,066	)	$	2,222

CONDENSED CONSOLIDATING STATEMENT OF INCOME
For the Three Months Ended January 1, 2010

		Guarantor Subsidiaries		Non-Guarantor Subsidiaries		Consolidating Eliminations			Consolidated Total
Sales		$	65,355	$	37,119	$	(19,707	)	$	82,767
Cost of sales			51,663		27,389		(19,725	)		59,327
Gross profit			13,692		9,730		18			23,440
Operating costs and expenses:
	Research and development		577		1,979		—			2,556
	Selling and marketing		2,766		2,274		—			5,040
	General and administrative		4,311		1,214		—			5,525
	Amortization of acquisition-related intangible assets		536		151		—			687
Total operating costs and expenses			8,190		5,618		—			13,808
Operating (loss) income			5,502		4,112		18			9,632
	Interest expense, net		3,853		28		—			3,881
(Loss) income before income tax expense and equity in income of subsidiaries			1,649		4,084		18			5,751
	Income tax (benefit) expense		1,367		543		—			1,910
	Equity in income of subsidiaries		3,559		—		(3,559	)		—
Net income		$	3,841	$	3,541	$	(3,541	)	$	3,841

F-98

CPI INTERNATIONAL, INC.
and Subsidiaries

NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(All tabular dollar amounts in thousands except share and per share amounts)

14. Supplemental Guarantors Condensed Consolidating Financial Information (Continued)

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the Three Months Ended December 31, 2010

			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Eliminations		Consolidated Total
Cash flows from operating activities
	Net cash (used in) provided by operating activities		$	9,266		$	8,221		$	—	$	17,487
Cash flows from investing activities
	Capital expenditures			(390	)		(57	)		—		(447	)
	Payment of patent application fees			(6	)		—			—		(6	)
		Net cash used in investing activities		(396	)		(57	)		—		(453	)
Cash flows from financing activities
	Payment for Senior Credit Facilities agreement amendment			(379	)		—			—		(379	)
	Proceeds from issuance of common stock to employees			217			—			—		217
	Proceeds from exercise of stock options			136			—			—		136
	Excess tax benefit on stock option exercises			70			—			—		70
		Net cash provided by (used in) financing activities		44			—			—		44
Net increase in cash and cash equivalents				8,914			8,164			—		17,078
	Cash and cash equivalents at beginning of period			30,336			12,493			—		42,829
	Cash and cash equivalents at end of period		$	39,250		$	20,657		$	—	$	59,907

CONDENSED CONSOLIDATING STATEMENT OF CASH FLOWS

For the Three Months Ended January 1, 2010

			Guarantor Subsidiaries			Non-Guarantor Subsidiaries			Consolidating Eliminations		Consolidated Total
Cash flows from operating activities
	Net cash (used in) provided by operating activities		$	4,028		$	5,536		$	—	$	9,564
Cash flows from investing activities
	Capital expenditures			(717	)		(94	)		—		(811	)
		Net cash used in investing activities		(717	)		(94	)		—		(811	)
Cash flows from financing activities
	Proceeds from issuance of common stock to employees			189			—			—		189
	Proceeds from exercise of stock options			14			—			—		14
	Excess tax benefit on stock option exercises			2			—			—		2
		Net cash provided by financing activities		205			—			—		205
Net increase in cash and cash equivalents				3,516			5,442			—		8,958
	Cash and cash equivalents at beginning of period			15,824			10,328			—		26,152
	Cash and cash equivalents at end of period		$	19,340		$	15,770		$	—	$	35,110

F-99

CPI INTERNATIONAL, INC.

Offer to Exchange

Offer to exchange $215 million aggregate principal amount of 8.00% Senior Notes due 2018

for

$215 million aggregate principal amount of 8.00% Senior Notes due 2018,
which have been registered under the Securities Act

PROSPECTUS

        Each broker-dealer that receives exchange notes for its own account pursuant to the exchange offer must acknowledge that it will deliver a prospectus in connection with any resale of such exchange notes. This prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales of exchange notes received in exchange for the outstanding notes where such outstanding notes were acquired as a result of market-making activities or other trading activities. We have agreed that, for a period of 180 days after the expiration of the exchange offer, it will make this prospectus, as amended or supplemented, available to any broker-dealer for use in connection with any such resale. See "Plan of Distribution." In addition, until            , 2011, all dealers that effect transactions in the exchange notes, whether or not participating in the exchange offer, may be required to deliver a prospectus. This is in addition to the dealers' obligation to deliver a prospectus when acting as underwriters and with respect to their unsold allotments or subscriptions.

                        , 2011

PART II
INFORMATION NOT REQUIRED IN PROSPECTUS

Item 20.    Indemnification of Directors and Officers.

Indemnification of Directors and Officers of CPI International, Inc.

        Section 145 of the Delaware General Corporation Law (the "DGCL") permits each corporation organized thereunder the power to indemnify any person who is or was a director, officer, employee or agent of a corporation or enterprise, against expenses, including attorneys' fees, judgments, fines and amounts paid in settlement actually and reasonably incurred by him in connection with any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative, other than an action by or in the right of the corporation to procure a judgment in its favor to procure a judgment in its favor, by reason of being or having been in any such capacity, if such person acted in good faith in a manner reasonably believed by such person to be in, or not opposed to, the best interests of the corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe his conduct was unlawful. Section 145 of the DGCL further provides that a corporation may indemnify any person who is or was a director, officer, employee or agent of a corporation or enterprise, against expenses, including attorneys' fees, actually and reasonably incurred by such person in connection with the defense or settlement of any threatened, pending or completed action, suit or proceeding by or in the right of the corporation to procure a judgment in its favor to procure a judgment in its favor, by reason of being or having been in any such capacity, if such person acted in good faith in a manner reasonably believed by such person to be in, or not opposed to, the best interests of the corporation, except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the corporation unless and only to the extent that the Court of Chancery or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, the person is fairly and reasonably entitled to indemnity for such expenses which the court shall deem proper. Section 145 of the DGCL also allows a corporation to provide contractual indemnification to its directors, and we have entered into indemnification agreements with each of our directors whereby we are contractually obligated to indemnify the director and advance expenses to the full extent permitted by the DGCL.

        Section 102(b)(7) of the DGCL enables a corporation in its certificate of incorporation to eliminate or limit the personal liability of a director to the corporation or its stockholders of monetary damages for violations of the directors' fiduciary duty of care, except (i) for any breach of the director's duty of loyalty to the corporation or its stockholders, (ii) for acts or omissions not in good faith or that involve intentional misconduct or a knowing violation of law, (iii) pursuant to Section 174 of the DGCL (providing for liability of directors for unlawful payment of dividends or unlawful stock purchases or redemptions) or (iv) for any transaction from which a director derived an improper personal benefit.

        Section Six of the Certificate of Incorporation of CPI International, Inc. ("CPII") provides that no director shall be personally liable to CPII or any of its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any breach of the director's duty of loyalty to CPII or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) pursuant to Section 174 of the DGCL or (iv) for any transaction from which the director derived an improper personal benefit.

        Article VIII of the By-laws of CPII allows it to purchase and maintain director and officer liability insurance on behalf of, and provides that CPII shall indemnify to the fullest extent permitted by law, any person who is or was a director or officer of CPII, or is or was a director or officer of CPII serving at the request of CPII as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise.

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Indemnification of Directors and Officers of the Guarantors

The Delaware Guarantors

        Each of CPI International Holding Corp., Communications & Power Industries International Inc. and Communications & Power Industries Asia Inc. is incorporated under the laws of the State of Delaware. The indemnification provisions of the DGCL described in "Indemnification of Directors and Officers of CPI International, Inc." above also relate to the directors and officers of each of CPI International Holding Corp., Communications & Power Industries International Inc. and Communications & Power Industries Asia Inc.

        Article Seven of the Certificate of Incorporation and Article Eight of the By-laws of each of Communications & Power Industries International Inc. and Communications & Power Industries Asia Inc. provides that a director of each corporation shall not be personally liable to such corporation or its stockholders for monetary damages for any breach of fiduciary duty as a director, except for liability (i) for any breach of the director's duty of loyalty to such corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the Delaware General Corporation Law or (iv) for any transaction from which such director derived any improper personal benefit.

        Article Eight of the Certificate of Incorporation and By-laws of each of Communications & Power Industries International Inc. and Communications & Power Industries Asia Inc. provides that each company may maintain insurance, at its expense, to protect itself and any director, officer, employee or agent of such companies or another corporation, partnership, joint venture, trust or other enterprise, and provides for the indemnification of each person who is or was a director or an officer of each company or is or was serving at the request of such company as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust or other enterprise.

        Section Six of the Certificate of Incorporation of CPI International Holding Corp. ("Parent") provides that no director shall be personally liable to Parent or any of its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any breach of the director's duty of loyalty to Parent or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) pursuant to Section 174 of the DGCL or (iv) for any transaction from which the director derived an improper personal benefit.

        Article VIII of the By-laws of Parent allows Parent to purchase and maintain director and officer liability insurance on behalf of, and provides that Parent shall indemnify to the fullest extent permitted by law, any person who is or was a director or officer of Parent, or is or was a director or officer of Parent serving at the request of Parent as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise.

        Each of Communications & Power Industries LLC and CPI Subsidiary Holdings LLC are a limited liability company organized under the laws of the State of Delaware. Section 18-303(a) of the Delaware Limited Liability Company Act ("DLLCA") provides that, except as otherwise provided by the DLLCA, the debts, obligations and liabilities of a limited liability company, whether arising in contract, tort or otherwise, shall be solely the debts, obligations and liabilities of the limited liability company, and no member or manager of a limited liability company shall be obligated personally for any such debt, obligation or liability of the limited liability company solely by reason of being a member or acting as a manager of the limited liability company. Section 18-108 of the DLLCA states that subject to such standards and restrictions, if any, as set forth in its limited liability company agreement, a limited liability company may, and shall have the power to, indemnify and hold harmless any member or manager or other person from and against any and all claims and demands whatsoever.

        Section 10.2 of the limited liability company agreement of each of Communications & Power Industries LLC and CPI Subsidiary Holdings LLC provides for the indemnification, to the fullest extent

II-2

of the law, of each company's members and any officers, directors, stockholders, partners, employees, affiliates, representatives or agents of such members, as well as any officer, employee, representative or agent of each of the companies.

The California Guarantors

        Each of CPI Econco Division and CPI Malibu Division is organized under the laws of the State of California.

        Section 317 of the California General Corporation Law ("CAGCL") authorizes a court to award, or a corporation to grant, indemnity to officers, directors and other agents for reasonable expenses incurred in connection with the defense or settlement of an action by or in the right of the corporation or in a proceeding by reason of the fact that the person is or was an officer, director, or agent of the corporation. Indemnity is available where the person party to a proceeding or action acted in good faith and in a manner reasonably believed to be in the best interests of the corporation and its shareholders and, with respect to criminal actions, had no reasonable cause to believe his conduct was unlawful. To the extent a corporation's officer, director or agent is successful on the merits in the defense of any proceeding or any claim, issue or related matter, that person shall be indemnified against expenses actually and reasonably incurred. Under Section 317 of the CAGCL, expenses incurred in defending any proceeding may be advanced by the corporation prior to the final disposition of the proceeding upon receipt of any undertaking by or on behalf of the officer, director, employee or agent to repay that amount if it is ultimately determined that the person is not entitled to be indemnified. Indemnifications are to be made by a majority vote of a quorum of disinterested directors, or by approval of members not including those persons to be indemnified, or by the court in which such proceeding is or was pending upon application made by either the corporation, the agent, the attorney, or other person rendering services in connection with the defense. The indemnification provided by Section 317 is not exclusive of any other rights to which those seeking indemnification may be entitled.

        Section Four of the Restated Articles of Incorporation of each of CPI Econco Division and CPI Malibu Division provides that the liability of the directors of such corporations for monetary damages shall be eliminated to the fullest extent permissible under California law. Section Four of the Restated Articles of Incorporation of each company authorizes each company to indemnify its directors and officers to the fullest extent permissible under California law.

        Section 5.5 of the By-laws of each of CPI Econco Division and CPI Malibu Division allows each company to purchase and maintain director and officer liability insurance on behalf of, and provides that each company shall indemnify to the fullest extent permitted by the California General Corporation Law, any person who is or was a director or officer of the companies, or is or was a director or officer of the companies serving at the request of t as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise.

Item 21.    Exhibits and Financial Statement Schedules.

Exhibits

        Certain of the agreements included as exhibits to this prospectus contain representations and warranties by each of the parties to the applicable agreement. These representations and warranties have been made solely for the benefit of the other parties to the applicable agreement and:

•

should not in all instances be treated as categorical statements of fact, but rather as a way of allocating the risk to one of the parties if those statements prove to be inaccurate;

II-3

•

have been qualified by disclosures that were made to the other party in connection with the negotiation of the applicable agreement, which disclosures are not necessarily reflected in the agreement;

•

may apply standards of materiality in a way that is different from what may be viewed as material to you or other investors; and

•

were made only as of the date of the applicable agreement or such other date or dates as may be specified in the agreement and are subject to more recent developments.

        Accordingly, these representations and warranties may not describe the actual state of affairs as of the date they were made or at any other time. The Company acknowledges that, notwithstanding the inclusion of the foregoing cautionary statements, it is responsible for considering whether additional specific disclosures of material information regarding material contractual provisions are required to make the statements in this registration statement not misleading.

        On February 11, 2011, CPI International LLC (formerly, CPI International, Inc., "Predecessor"), a then Delaware corporation and publicly traded company, completed its merger with Catalyst Acquisition, Inc. ("Merger Sub"), a Delaware corporation and wholly owned subsidiary of CPI International Acquisition, Inc., a Delaware corporation, whereby Merger Sub merged with and into Predecessor (the "Merger"), with Predecessor continuing as the surviving corporation and a wholly owned subsidiary of CPI International Acquisition, Inc. Immediately following the consummation of the Merger and related transactions, Predecessor was converted into a limited liability company and liquidated, and CPI International Acquisition, Inc. changed its name to CPI International, Inc. Certain of the exhibits incorporated by reference herein were filed by Predecessor and its wholly owned subsidiary Communications & Power Industries LLC (formerly, Communications & Power Industries Inc. ("CPI")), which was converted into a Delaware limited liability company upon the consummation of the Merger.

II-4

Exhibit		Description	Incorporated by Reference to:
	2.1	Agreement and Plan of Merger, dated as of November 24, 2010, by and among Catalyst Holdings, Inc., Catalyst Acquisition, Inc. and CPI International, Inc.	Predecessor's Form 8-K, filed on November 29, 2010.
	3.1	Certificate of Incorporation of CPI International, Inc.	Filed herewith.
	3.2	By-laws of CPI International, Inc.	Filed herewith.
	3.3	Certificate of Incorporation of CPI International Holding Corp.	Filed herewith.
	3.4	By-laws of CPI International Holding Corp.	Filed herewith.
	3.5	Certificate of Incorporation of Communications & Power Industries International Inc.	CPI's Registration Statement on Form S-4 (Registration No. 333-113867), filed on March 23, 2004.
	3.6	By-laws of Communications & Power Industries International Inc.	CPI's Registration Statement on Form S-4 (Registration No. 333-113867), filed on March 23, 2004.
	3.7	Restated Certificate of Incorporation of Communications & Power Industries Asia Inc.	Filed herewith.
	3.8	By-laws of Communications & Power Industries Asia Inc.	CPI's Registration Statement on Form S-4 (Registration No. 333-113867), filed on March 23, 2004.
	3.9	Restated Articles of Incorporation of CPI Econco Division	Filed herewith.
	3.10	Restated By-laws of CPI Econco Division	Filed herewith.
	3.11	Restated Articles of Incorporation of CPI Malibu Division	Filed herewith.
	3.12	Restated By-laws of CPI Malibu Division	Filed herewith.
	3.13	Certificate of Conversion from a Corporation to a Limited Liability Company of Communications & Power Industries LLC	Filed herewith.
	3.14	Certificate of Formation of Communications & Power Industries LLC	Filed herewith.
	3.15	Limited Liability Company Agreement of Communications & Power Industries LLC	Filed herewith.
	3.16	Certificate of Conversion from a Corporation to a Limited Liability Company of CPI Subsidiary Holdings LLC	Filed herewith.
	3.17	Certificate of Formation of CPI Subsidiary Holdings LLC	Filed herewith.
	3.18	Limited Liability Company Agreement of CPI Subsidiary Holdings LLC	Filed herewith.

II-5

Exhibit		Description	Incorporated by Reference to:
	4.1	Indenture, dated as of February 11, 2011 by and among, CPI International, Inc., CPI International Holding Corp. and The Bank of New York Mellon Trust Company, N.A.	Filed herewith.
	4.2	Supplemental Indenture, dated as of February 11, 2011, by and among, CPI International, Inc., CPI International Holding Corp., Communications & Power Industries LLC, CPI Subsidiary Holdings LLC, Communications & Power Industries International Inc., Communications & Power Industries Asia Inc., CPI Econco Division, CPI Malibu Division and The Bank of New York Mellon Trust Company, N.A.	Filed herewith.
	4.3	Registration Rights Agreement, relating to the 8.00% Senior Notes due 2018, dated as of February 11, 2011, by and among, CPI International Acquisition, Inc., the guarantors named therein, UBS Securities LLC and KKR Capital Markets LLC	Filed herewith.
	4.4	Joinder Agreement, dated as of February 11, 2011, by and among, Communications & Power Industries LLC, CPI Subsidiary Holdings LLC, Communications & Power Industries International Inc., Communications & Power Industries Asia Inc., CPI Econco Division and CPI Malibu Division	Filed herewith.
	4.5	Form of 8.00% Senior Note due 2018 (included as part of Exhibit 4.1).	Filed herewith.
	5.1	Opinion of Skadden, Arps, Slate, Meagher & Flom LLP	Filed herewith.
	10.1	Credit Agreement, dated as of February 11, 2011, by and among, CPI International Acquisition, Inc., as borrower, CPI International Holding Corp., the subsidiary guarantors named therein, the lenders named therein, UBS Securities LLC, as the sole lead arranger, Bank of the West and GE Capital Financial Inc., as co-documentation agents, KKR Capital Markets LLC, as syndication agent, UBS Loan Finance LLC, as swingline lender, UBS AG, Stamford Branch, as issuing bank and administrative agent for the lenders and as collateral agent	Filed herewith.
	10.2	Advisory Agreement, dated as of February 11, 2011, between CPI International, Inc. and Veritas Capital Fund Management, L.L.C.	Filed herewith.
	10.3	Cross License Agreement, dated as of August 10, 1995, between CPI and Varian Associates	CPI's Registration Statement on Form S-1 (Registration No. 033-96858) filed on September 12, 1995.

II-6

Exhibit		Description	Incorporated by Reference to:
	10.4	Agreement of Purchase and Sale (San Carlos Property), dated February 7, 2003, by and between CPI (as successor to Holding) and Palo Alto Medical Foundation; Seventh Amendment, dated November 12, 2003; and Ninth Amendment, dated June 16, 2004	Predecessor's Quarterly Report on Form 10-Q for the quarter ended July 2, 2004.
	10.5	Agreement re: Environmental Matters, dated June 18, 2004, by and between 301 Holding LLC, CPI, Varian Medical Systems, Inc. and Palo Alto Medical Foundation	Predecessor's Quarterly Report on Form 10-Q for the quarter ended July 2, 2004.
	10.6	Assignment and Assumption of Lessee's Interest in Lease (Units 1-4, Palo Alto) and Covenants, Conditions and Restrictions on Leasehold Interests (Units 1-12, Palo Alto), dated as of August 10, 1995, by and among Varian Realty Inc., Varian Associates and CPI	CPI's Registration Statement on Form S-1 (Registration No. 033-96858) filed on September 12, 1995.
	10.7	Fourth Amendment of Lease, dated December 15, 2000, by and between The Board of Trustees of the Leland Stanford Junior University and CPI	CPI's Quarterly Report on Form 10-Q for the quarter ended December 29, 2000 (File No. 033-96858).
	10.8	Sublease (Unit 8, Palo Alto), dated as of August 10, 1995, by and between Varian Realty Inc. and CPI	CPI's Registration Statement on Form S-1 (Registration No. 033-96858) filed on September 12, 1995.
	10.9	Sublease (Building 4, Palo Alto), dated as of August 10, 1995, by and between CPI, as Sublessee, Varian, as Sublessor, and Varian Realty Inc., as Adjacent Property Sublessor	CPI's Registration Statement on Form S-1 (Registration No. 033-96858) filed on September 12, 1995.
	10.10	First Amendment to Sublease, Subordination, Non-Disturbance and Attornment Agreement, dated as of April 2, 1999, by and among Varian, Inc., CPI, Varian, and Varian Realty Inc.	Predecessor's Registration Statement on Form S-4 (Registration No. 333-123917) filed on April 7, 2005.
	10.11	Second Amendment to Sublease, dated as of April 28, 2000, by and between Varian, Inc. and CPI	Predecessor's Registration Statement on Form S-4 (Registration No. 333-123917) filed on April 7, 2005.
	10.12	Communications & Power Industries 2000 Stock Option Plan	CPI's Annual Report on Form 10-K for the fiscal year ended September 29, 2000 (File No. 033-96858).
	10.13	First Amendment to Communications and Power Industries 2000 Stock Option Plan	CPI's Quarterly Report on Form 10-Q for the quarter ended April 4, 2003.
	10.14	Form of Stock Option Agreement 2000 Stock Option Plan	CPI's Annual Report on Form 10-K for the fiscal year ended September 29, 2000 (File No. 033-96858).

II-7

Exhibit		Description	Incorporated by Reference to:
	10.15	Form of Option Rollover Agreement (U.S. Employees)	CPI's Quarterly Report on Form 10-Q for the quarter ended January 2, 2004.
	10.16	Form of Option Rollover Agreement (Canadian Employees)	Predecessor's Registration Statement on Form S-4 (Registration No. 333-123917) filed on April 7, 2005.
	10.17	Conformed copy of 2004 Stock Incentive Plan reflecting amendments adopted on September 24, 2004 and December 7, 2006	Predecessor's Annual Report on Form 10-K for the fiscal year ended September 29, 2006.
	10.18	Form of Option Agreement (Employees) under the 2004 Stock Incentive Plan	Predecessor's Quarterly Report on Form 10-Q for the quarter ended April 2, 2004.
	10.19	Form of Option Agreement (Directors) under the 2004 Stock Incentive Plan	Predecessor's Quarterly Report on Form 10-Q for the quarter ended April 2, 2004.
	10.20	Conformed copy of 2006 Equity and Performance Incentive Plan reflecting amendments adopted on December 7, 2006, December 9, 2008 and February 24, 2009	Predecessor's Form 8-K filed on February 25, 2009.
	10.21	Form of Stock Option Agreement (IPO Grant) under 2006 Equity and Performance Incentive Plan	Predecessor's Registration Statement on Form S-1/A filed on April 11, 2006 (Commission File No. 333-130662).
	10.22	Form of Stock Option Agreement (Senior Executives) (IPO Grant) under 2006 Equity and Performance Incentive Plan	Predecessor's Registration Statement on Form S-1/A filed on April 11, 2006 (Commission File No. 333-130662).
	10.23	Form of Stock Option Agreement (Directors) under 2006 Equity and Performance Incentive Plan	Predecessor's Registration Statement on Form S-1/A filed on April 11, 2006 (Commission File No. 333-130662).
	10.24	Form of Restricted Stock Agreement (Directors) under 2006 Equity and Performance Incentive Plan	Predecessor's Registration Statement on Form S-1/A filed on April 11, 2006 (Commission File No. 333-130662).
	10.25	Conformed copy of 2006 Employee Stock Purchase Plan reflecting amendments adopted on July 1, 2006 and December 7, 2006	Predecessor's Annual Report on Form 10-K for the fiscal year ended September 29, 2006

II-8

Exhibit		Description	Incorporated by Reference to:
	10.26	Pension Plan for Executive Employees of CPI Canada, Inc. (as applicable to O. Joe Caldarelli) effective January 1, 2002	CPI's Annual Report on Form 10-K for the fiscal year ended October 3, 2003.
	10.27	First Amendment and Restatement of the CPI Non-Qualified Deferred Compensation Plan effective as of December 1, 2004	Predecessor's Form 10-Q filed on February 6, 2008.
	10.28	Employment Agreement, dated as of April 27, 2006, by and between Communications & Power Industries Canada Inc. and O. Joe Caldarelli	Predecessor's Form 10-Q filed on May 15, 2006
	10.29	Amended and Restated Employment Agreement, dated as of January 17, 2008, by and between CPI and Robert A. Fickett	Predecessor's Form 10-Q filed on February 6, 2008.
	10.30	Amended and Restated Employment Agreement, dated as of January 17, 2008, by and between CPI and Joel A. Littman	Predecessor's Form 10-Q filed on February 6, 2008.
	10.31	Employment Agreement, dated November 2, 2002, by and between CPI and Don Coleman	CPI's Annual Report on Form 10-K for the fiscal year ended October 3, 2003.
	10.32	Form of Indemnification Agreement	Predecessor's Registration Statement on Form S-1/A filed on April 11, 2006 (Commission File No. 333-130662)
	10.33	Form of Stock Option Agreement (Senior Executives) under 2006 Equity and Performance Incentive Plan	Predecessor's Form 8-K filed on December 13, 2006.
	10.34	Form of Stock Option Agreement under 2006 Equity and Performance Incentive Plan	Predecessor's Form 8-K filed on December 13, 2006.
	10.35	Employment Agreement, dated June 27, 2000, by and between CPI and John R. Beighley	Predecessor's Form 10-Q filed on February 12, 2007.
	10.36	Form of Restricted Stock Agreement (Senior Executives) under 2006 Equity and Performance Incentive Plan	Predecessor's Form 8-K filed on December 11, 2007.
	10.37	Form of Restricted Stock Agreement under 2006 Equity and Performance Incentive Plan	Predecessor's Form 8-K filed on December 11, 2007.
	10.38	Form of Restricted Stock Unit Award Agreement (Senior Executives) under 2006 Equity and Performance Incentive Plan	Predecessor's Form 8-K filed on December 11, 2007.
	10.39	Form of Restricted Stock Unit Award Agreement under 2006 Equity and Performance Incentive Plan	Predecessor's Form 8-K filed on December 11, 2007.
	10.40	Employment Agreement, dated June 21, 2004, by and between CPI and Andrew Tafler	Predecessor's Form 10-K filed on December 15, 2008.
	10.41	New Form of Performance Stock Option Agreement (Senior Executives) under 2006 Equity and Performance Incentive Plan	Predecessor's Form 10-K filed on December 15, 2008.

II-9

Exhibit		Description	Incorporated by Reference to:
	10.42	New Form of Performance Stock Option Agreement under 2006 Equity and Performance Incentive Plan	Predecessor's Form 10-K filed on December 15, 2008.
	10.43	New Form of Performance Restricted Stock Agreement (Senior Executives) under 2006 Equity and Performance Incentive Plan	Predecessor's Form 10-K filed on December 15, 2008.
	10.44	New Form of Performance Restricted Stock Agreement under 2006 Equity and Performance Incentive Plan	Predecessor's Form 10-K filed on December 15, 2008.
	10.45	New Form of Performance Restricted Stock Unit Award Agreement (Senior Executives) under 2006 Equity and Performance Incentive Plan	Predecessor's Form 10-K filed on December 15, 2008.
	10.46	New Form of Performance Restricted Stock Unit Award Agreement under 2006 Equity and Performance Incentive Plan	Predecessor's Form 10-K filed on December 15, 2008.
	12.1	Computation of Earnings to Fixed Charges	Filed herewith.
	21.1	List of Subsidiaries	Filed herewith.
	23.1	Consent of Skadden, Arps, Slate, Meagher & Flom LLP (included in Exhibit 5.1).	Filed herewith.
	23.2	Consent of KPMG LLP	Filed herewith.
	23.3	Consent of KPMG LLP	Filed herewith.
	25.1	Statement of Eligibility of The Bank of New York Mellon Trust Company, N.A., Trustee, as set forth on Form T-1	Filed herewith.
	99.1	Form of Letter of Transmittal	Filed herewith.
	99.2	Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees	Filed herewith.
	99.3	Form of Letter to Clients	Filed herewith.

Item 22.    Undertakings

The undersigned registrant hereby undertakes:

1)

To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

(a)

To include any prospectus required by section 10(a)(3) of the Securities Act of 1933;

(b)

To reflect in the prospectus any facts or events arising after the effective date of the registration statement (or the most recent post-effective amendment thereof) which, individually or in the aggregate, represent a fundamental change in the information set forth in the registration statement. Notwithstanding the foregoing, any increase or decrease in volume of securities offered (if the total dollar value of securities offered would not exceed that which was registered) and any deviation from the low or high end of the estimated maximum offering range may be reflected in the form of prospectus filed with the Commission pursuant to Rule 424(b) if, in the aggregate, the changes in volume and price represent no more than 20% change in the maximum aggregate offering price set forth in the "Calculation of Registration Fee" table in the effective registration statement;

II-10

(c)

To include any material information with respect to the plan of distribution not previously disclosed in the registration statement or any material change to such information in the registration statement.

2)

That, for the purpose of determining any liability under the Securities Act of 1933, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered therein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

3)

To remove from registration by means of a post-effective amendment any of the securities being registered which remain unsold at the termination of the offering.

4)

Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to directors, officers and controlling persons of the registrant pursuant to the foregoing provisions, or otherwise, the registrant has been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Act and is, therefore, unenforceable. In the event that a claim for indemnification against such liabilities (other than the payment by the registrant of expenses incurred or paid by a director, officer or controlling person of the registrant in the successful defense of any action, suit or proceeding) is asserted by such director, officer or controlling person in connection with the securities being registered, the registrant will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification by it is against public policy as expressed in the Act and will be governed by the final adjudication of such issue.

5)

For the purpose of determining liability under the Securities Act of 1933 to any purchaser, each prospectus filed pursuant to Rule 424(b) as part of a registration statement relating to an offering, other than registration statements relying on Rule 430B or other than prospectuses filed in reliance on Rule 430A, shall be deemed to be part of and included in the registration statement as of the date it is first used after effectiveness. Provided, however, that no statement made in a registration statement or prospectus that is part of the registration statement or made in a document incorporated or deemed incorporated by reference into the registration statement or prospectus that is part of the registration statement will, as to a purchaser with a time of contract of sale prior to such first use, supersede or modify any statement that was made in the registration statement or prospectus that was part of the registration statement or made in any such document immediately prior to such date of first use.

6)

The undersigned registrant hereby undertakes to respond to requests for information that is incorporated by reference into the prospectus pursuant to Items 4, 10(b), 11, or 13 of this Form, within one business day of receipt of such request, and to send the incorporated documents by first class mail or other equally prompt means. This includes information contained in documents filed subsequent to the effective date of the registration statement through the date of responding to the request.

7)

The undersigned registrant hereby undertakes to supply by means of a post-effective amendment all information concerning a transaction, and the company being acquired involved therein, that was not the subject of and included in the registration statement when it became effective.

II-11

SIGNATURES

        Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Palo Alto, State of California, on April 7, 2011.

CPI INTERNATIONAL HOLDING CORP.
By:	/s/ JOEL A. LITTMAN
	Name:	Joel A. Littman
	Title:	Chief Financial Officer, Treasurer and Secretary

SIGNATURES AND POWERS OF ATTORNEY

        KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below hereby constitutes and appoints O. Joe Caldarelli and Joel A. Littman and each of them, the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462 under the Securities Act of 1933, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

        Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.

Signature	Title	Date
/s/ O. JOE CALDARELLI O. Joe Caldarelli	Chief Executive Officer and Director (principal executive officer)	April 7, 2011
/s/ ROBERT A. FICKETT Robert A. Fickett	President, Chief Operating Officer and Director	April 7, 2011
/s/ ROBERT B. MCKEON Robert B. McKeon	Director	April 7, 2011
/s/ HUGH D. EVANS Hugh D. Evans	Assistant Secretary and Director	April 7, 2011

S-1

Signature	Title	Date
/s/ RAMZI M. MUSALLAM Ramzi M. Musallam	Director	April 7, 2011
/s/ JEFFREY P. KELLY Jeffrey P. Kelly	Assistant Treasurer and Director	April 7, 2011
/s/ JOEL A. LITTMAN Joel A. Littman	Chief Financial Officer, Treasurer and Secretary (principal financial officer and accounting officer)	April 7, 2011

S-2

        Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Palo Alto, State of California, on April 7, 2011.

CPI INTERNATIONAL, INC.
By:	/s/ JOEL A. LITTMAN
	Name:	Joel A. Littman
	Title:	Chief Financial Officer, Treasurer and Secretary

SIGNATURES AND POWERS OF ATTORNEY

        KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below hereby constitutes and appoints O. Joe Caldarelli and Joel A. Littman and each of them, the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462 under the Securities Act of 1933, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

        Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.

Signature	Title	Date
/s/ O. JOE CALDARELLI O. Joe Caldarelli	Chief Executive Officer and Director (principal executive officer)	April 7, 2011
/s/ ROBERT A. FICKETT Robert A. Fickett	President, Chief Operating Officer and Director	April 7, 2011
/s/ ROBERT B. MCKEON Robert B. McKeon	Director	April 7, 2011
/s/ HUGH D. EVANS Hugh D. Evans	Assistant Secretary and Director	April 7, 2011

S-3

Signature	Title	Date
/s/ RAMZI M. MUSALLAM Ramzi M. Musallam	Director	April 7, 2011
/s/ JEFFREY P. KELLY Jeffrey P. Kelly	Assistant Treasurer and Director	April 7, 2011
/s/ JOEL A. LITTMAN Joel A. Littman	Chief Financial Officer, Treasurer and Secretary (principal financial officer and accounting officer)	April 7, 2011

S-4

        Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Palo Alto, State of California, on April 7, 2011.

COMMUNICATIONS & POWER INDUSTRIES LLC
By:	/s/ JOEL A. LITTMAN Name:  Joel A. Littman Title:    Chief Financial Officer, Treasurer and             Secretary

SIGNATURES AND POWERS OF ATTORNEY

        KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below hereby constitutes and appoints O. Joe Caldarelli and Joel A. Littman and each of them, the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462 under the Securities Act of 1933, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

        Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.

Signature	Title	Date
/s/ O. JOE CALDARELLI O. Joe Caldarelli	Chief Executive Officer and Manager (principal executive officer)	April 7, 2011
/s/ ROBERT A. FICKETT Robert A. Fickett	President, Chief Operating Officer and Manager	April 7, 2011
/s/ ROBERT B. MCKEON Robert B. McKeon	Manager	April 7, 2011
/s/ HUGH D. EVANS Hugh D. Evans	Assistant Secretary and Manager	April 7, 2011
/s/ RAMZI M. MUSALLAM Ramzi M. Musallam	Manager	April 7, 2011
/s/ JEFFREY P. KELLY Jeffrey P. Kelly	Manager	April 7, 2011
/s/ JOEL A. LITTMAN Joel A. Littman	Chief Financial Officer, Treasurer and Secretary (principal financial officer and accounting officer)	April 7, 2011

S-5

        Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Palo Alto, State of California, on April 7, 2011.

CPI SUBSIDIARY HOLDINGS LLC*
By:	/s/ JOEL A. LITTMAN Name:  Joel A. Littman Title:    Secretary

SIGNATURES AND POWERS OF ATTORNEY

        KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below hereby constitutes and appoints Robert A. Fickett and Joel A. Littman and each of them, the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462 under the Securities Act of 1933, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

        Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.

Signature Title Date

By:	Communications & Powers Industries LLC, as Sole Member
/s/ JOEL A. LITTMAN Name:  Joel A. Littman Title:    Chief Financial Officer,             Treasurer and Secretary		Sole Member	April 7, 2011

/s/ ROBERT A. FICKETT Robert A. Fickett	President and Treasurer (principal executive officer)	April 7, 2011
/s/ JOEL A. LITTMAN Joel A. Littman	Secretary (principal financial officer and accounting officer)	April 7, 2011

*

CPI Subsidiary Holdings LLC is a single member limited liability company managed by its sole member, Communications & Powers Industries LLC.

S-6

        Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Palo Alto, State of California, on April 7, 2011.

COMMUNICATIONS & POWER INDUSTRIES INTERNATIONAL INC.
By:	/s/ JOEL A. LITTMAN Name:  Joel A. Littman Title:    Secretary

SIGNATURES AND POWERS OF ATTORNEY

        KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below hereby constitutes and appoints John R. Beighley and Joel A. Littman and each of them, the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462 under the Securities Act of 1933, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

        Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.

Signature	Title	Date
/s/ JOHN R. BEIGHLEY John R. Beighley	Sole Director, President and Treasurer (principal executive officer)	April 7, 2011
/s/ JOEL A. LITTMAN Joel A. Littman	Secretary (principal financial officer and accounting officer)	April 7, 2011

S-7

        Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Palo Alto, State of California, on April 7, 2011.

COMMUNICATIONS & POWER INDUSTRIES ASIA INC.
By:	/s/ JOEL A. LITTMAN Name:  Joel A. Littman Title:    Secretary and Treasurer

SIGNATURES AND POWERS OF ATTORNEY

        KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below hereby constitutes and appoints John R. Beighley and Joel A. Littman and each of them, the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462 under the Securities Act of 1933, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

        Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.

Signature	Title	Date
/s/ JOHN R. BEIGHLEY John R. Beighley	Sole Director and President (principal executive officer)	April 7, 2011
/s/ JOEL A. LITTMAN Joel A. Littman	Secretary and Treasurer (principal financial officer and accounting officer)	April 7, 2011

S-8

        Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Palo Alto, State of California, on April 7, 2011.

CPI ECONCO DIVISION
By:	/s/ JOEL A. LITTMAN
	Name:	Joel A. Littman
	Title:	Secretary, Treasurer and Director

SIGNATURES AND POWERS OF ATTORNEY

        KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below hereby constitutes and appoints Robert A. Fickett and Joel A. Littman and each of them, the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462 under the Securities Act of 1933, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

        Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.

Signature	Title	Date
/s/ DAVID ELLIOT David Elliot	President (principal executive officer)	April 7, 2011
/s/ ROBERT A. FICKETT Robert A. Fickett	Director	April 7, 2011
/s/ JOEL A. LITTMAN Joel A. Littman	Secretary, Treasurer and Director (principal financial officer and accounting officer)	April 7, 2011

S-9

        Pursuant to the requirements of the Securities Act of 1933, the registrant has duly caused this registration statement to be signed on its behalf by the undersigned, thereunto duly authorized, in the City of Palo Alto, State of California, on April 7, 2011.

CPI MALIBU DIVISION
By:	/s/ JOEL A. LITTMAN
	Name:	Joel A. Littman
	Title:	Secretary, Chief Financial Officer and Director

SIGNATURES AND POWERS OF ATTORNEY

        KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below hereby constitutes and appoints Robert A. Fickett and Joel A. Littman and each of them, the true and lawful attorneys-in-fact and agents of the undersigned, with full power of substitution and resubstitution, for and in the name, place and stead of the undersigned, in any and all capacities, to sign any and all amendments (including post-effective amendments) to this registration statement, including any filings pursuant to Rule 462 under the Securities Act of 1933, as amended, and to file the same, with all exhibits thereto, and all other documents in connection therewith, with the Securities and Exchange Commission, and hereby grants to such attorneys-in-fact and agents, and each of them, full power and authority to do and perform each and every act and anything necessary to be done, as fully to all intents and purposes as the undersigned might or could do in person, hereby ratifying and confirming all that said attorneys-in-fact and agents, or any of them, or their or his substitute, or substitutes, may lawfully do or cause to be done by virtue hereof.

        Pursuant to the requirements of the Securities Act of 1933, this registration statement has been signed by the following persons in the capacities and on the dates indicated.

Signature	Title	Date
/s/ ROBERT A. FICKETT Robert A. Fickett	President and Director (principal executive officer)	April 7, 2011
/s/ JOEL A. LITTMAN Joel A. Littman	Secretary, Chief Financial Officer and Director (principal financial officer and accounting officer)	April 7, 2011

S-10

EXHIBITS

Exhibit		Description	Incorporated by Reference to:
	2.1	Agreement and Plan of Merger, dated as of November 24, 2010, by and among Catalyst Holdings, Inc., Catalyst Acquisition, Inc. and CPI International, Inc.	Predecessor's Form 8-K, filed on November 29, 2010.
	3.1	Certificate of Incorporation of CPI International, Inc.	Filed herewith.
	3.2	By-laws of CPI International, Inc.	Filed herewith.
	3.3	Certificate of Incorporation of CPI International Holding Corp.	Filed herewith.
	3.4	By-laws of CPI International Holding Corp.	Filed herewith.
	3.5	Certificate of Incorporation of Communications & Power Industries International Inc.	CPI's Registration Statement on Form S-4 (Registration No. 333-113867), filed on March 23, 2004.
	3.6	By-laws of Communications & Power Industries International Inc.	CPI's Registration Statement on Form S-4 (Registration No. 333-113867), filed on March 23, 2004.
	3.7	Restated Certificate of Incorporation of Communications & Power Industries Asia Inc.	Filed herewith.
	3.8	By-laws of Communications & Power Industries Asia Inc.	CPI's Registration Statement on Form S-4 (Registration No. 333-113867), filed on March 23, 2004.
	3.9	Restated Articles of Incorporation of CPI Econco Division	Filed herewith.
	3.10	Restated By-laws of CPI Econco Division	Filed herewith.
	3.11	Restated Articles of Incorporation of CPI Malibu Division	Filed herewith.
	3.12	Restated By-laws of CPI Malibu Division	Filed herewith.
	3.13	Certificate of Conversion from a Corporation to a Limited Liability Company of Communications & Power Industries LLC	Filed herewith.
	3.14	Certificate of Formation of Communications & Power Industries LLC	Filed herewith.
	3.15	Limited Liability Company Agreement of Communications & Power Industries LLC	Filed herewith.
	3.16	Certificate of Conversion from a Corporation to a Limited Liability Company of CPI Subsidiary Holdings LLC	Filed herewith.
	3.17	Certificate of Formation of CPI Subsidiary Holdings LLC	Filed herewith.
	3.18	Limited Liability Company Agreement of CPI Subsidiary Holdings LLC	Filed herewith.
	4.1	Indenture, dated as of February 11, 2011 by and among, CPI International, Inc., CPI International Holding Corp. and The Bank of New York Mellon Trust Company, N.A.	Filed herewith.

Ex-1

Exhibit		Description	Incorporated by Reference to:
	4.2	Supplemental Indenture, dated as of February 11, 2011, by and among, CPI International, Inc., CPI International Holding Corp., Communications & Power Industries LLC, CPI Subsidiary Holdings LLC, Communications & Power Industries International Inc., Communications & Power Industries Asia Inc., CPI Econco Division, CPI Malibu Division and The Bank of New York Mellon Trust Company, N.A.	Filed herewith.
	4.3	Registration Rights Agreement, relating to the 8.00% Senior Notes due 2018, dated as of February 11, 2011, by and among, CPI International Acquisition, Inc., the guarantors named therein, UBS Securities LLC and KKR Capital Markets LLC	Filed herewith.
	4.4	Joinder Agreement, dated as of February 11, 2011, by and among, Communications & Power Industries LLC, CPI Subsidiary Holdings LLC, Communications & Power Industries International Inc., Communications & Power Industries Asia Inc., CPI Econco Division and CPI Malibu Division	Filed herewith.
	4.5	Form of 8.00% Senior Note due 2018 (included as part of Exhibit 4.1).	Filed herewith.
	5.1	Opinion of Skadden, Arps, Slate, Meagher & Flom LLP	Filed herewith.
	10.1	Credit Agreement, dated as of February 11, 2011, by and among, CPI International Acquisition, Inc., as borrower, CPI International Holding Corp., the subsidiary guarantors named therein, the lenders named therein, UBS Securities LLC, as the sole lead arranger, Bank of the West and GE Capital Financial Inc., as co-documentation agents, KKR Capital Markets LLC, as syndication agent, UBS Loan Finance LLC, as swingline lender, UBS AG, Stamford Branch, as issuing bank and administrative agent for the lenders and as collateral agent	Filed herewith.
	10.2	Advisory Agreement, dated as of February 11, 2011, between CPI International, Inc. and Veritas Capital Fund Management, L.L.C.	Filed herewith.
	10.3	Cross License Agreement, dated as of August 10, 1995, between CPI and Varian Associates	CPI's Registration Statement on Form S-1 (Registration No. 033-96858) filed on September 12, 1995.
	10.4	Agreement of Purchase and Sale (San Carlos Property), dated February 7, 2003, by and between CPI (as successor to Holding) and Palo Alto Medical Foundation; Seventh Amendment, dated November 12, 2003; and Ninth Amendment, dated June 16, 2004	Predecessor's Quarterly Report on Form 10-Q for the quarter ended July 2, 2004.
	10.5	Agreement re: Environmental Matters, dated June 18, 2004, by and between 301 Holding LLC, CPI, Varian Medical Systems, Inc. and Palo Alto Medical Foundation	Predecessor's Quarterly Report on Form 10-Q for the quarter ended July 2, 2004.

Ex-2

Exhibit		Description	Incorporated by Reference to:
	10.6	Assignment and Assumption of Lessee's Interest in Lease (Units 1-4, Palo Alto) and Covenants, Conditions and Restrictions on Leasehold Interests (Units 1-12, Palo Alto), dated as of August 10, 1995, by and among Varian Realty Inc., Varian Associates and CPI	CPI's Registration Statement on Form S-1 (Registration No. 033-96858) filed on September 12, 1995.
	10.7	Fourth Amendment of Lease, dated December 15, 2000, by and between The Board of Trustees of the Leland Stanford Junior University and CPI	CPI's Quarterly Report on Form 10-Q for the quarter ended December 29, 2000 (File No. 033-96858).
	10.8	Sublease (Unit 8, Palo Alto), dated as of August 10, 1995, by and between Varian Realty Inc. and CPI	CPI's Registration Statement on Form S-1 (Registration No. 033-96858) filed on September 12, 1995.
	10.9	Sublease (Building 4, Palo Alto), dated as of August 10, 1995, by and between CPI, as Sublessee, Varian, as Sublessor, and Varian Realty Inc., as Adjacent Property Sublessor	CPI's Registration Statement on Form S-1 (Registration No. 033-96858) filed on September 12, 1995.
	10.10	First Amendment to Sublease, Subordination, Non-Disturbance and Attornment Agreement, dated as of April 2, 1999, by and among Varian, Inc., CPI, Varian, and Varian Realty Inc.	Predecessor's Registration Statement on Form S-4 (Registration No. 333-123917) filed on April 7, 2005.
	10.11	Second Amendment to Sublease, dated as of April 28, 2000, by and between Varian, Inc. and CPI	Predecessor's Registration Statement on Form S-4 (Registration No. 333-123917) filed on April 7, 2005.
	10.12	Communications & Power Industries 2000 Stock Option Plan	CPI's Annual Report on Form 10-K for the fiscal year ended September 29, 2000 (File No. 033-96858).
	10.13	First Amendment to Communications and Power Industries 2000 Stock Option Plan	CPI's Quarterly Report on Form 10-Q for the quarter ended April 4, 2003.
	10.14	Form of Stock Option Agreement 2000 Stock Option Plan	CPI's Annual Report on Form 10-K for the fiscal year ended September 29, 2000 (File No. 033-96858).
	10.15	Form of Option Rollover Agreement (U.S. Employees)	CPI's Quarterly Report on Form 10-Q for the quarter ended January 2, 2004.
	10.16	Form of Option Rollover Agreement (Canadian Employees)	Predecessor's Registration Statement on Form S-4 (Registration No. 333-123917) filed on April 7, 2005.
	10.17	Conformed copy of 2004 Stock Incentive Plan reflecting amendments adopted on September 24, 2004 and December 7, 2006	Predecessor's Annual Report on Form 10-K for the fiscal year ended September 29, 2006.
	10.18	Form of Option Agreement (Employees) under the 2004 Stock Incentive Plan	Predecessor's Quarterly Report on Form 10-Q for the quarter ended April 2, 2004.

Ex-3

Exhibit		Description	Incorporated by Reference to:
	10.19	Form of Option Agreement (Directors) under the 2004 Stock Incentive Plan	Predecessor's Quarterly Report on Form 10-Q for the quarter ended April 2, 2004.
	10.20	Conformed copy of 2006 Equity and Performance Incentive Plan reflecting amendments adopted on December 7, 2006, December 9, 2008 and February 24, 2009	Predecessor's Form 8-K filed on February 25, 2009.
	10.21	Form of Stock Option Agreement (IPO Grant) under 2006 Equity and Performance Incentive Plan	Predecessor's Registration Statement on Form S-1/A filed on April 11, 2006 (Commission File No. 333-130662).
	10.22	Form of Stock Option Agreement (Senior Executives) (IPO Grant) under 2006 Equity and Performance Incentive Plan	Predecessor's Registration Statement on Form S-1/A filed on April 11, 2006 (Commission File No. 333-130662).
	10.23	Form of Stock Option Agreement (Directors) under 2006 Equity and Performance Incentive Plan	Predecessor's Registration Statement on Form S-1/A filed on April 11, 2006 (Commission File No. 333-130662).
	10.24	Form of Restricted Stock Agreement (Directors) under 2006 Equity and Performance Incentive Plan	Predecessor's Registration Statement on Form S-1/A filed on April 11, 2006 (Commission File No. 333-130662).
	10.25	Conformed copy of 2006 Employee Stock Purchase Plan reflecting amendments adopted on July 1, 2006 and December 7, 2006	Predecessor's Annual Report on Form 10-K for the fiscal year ended September 29, 2006
	10.26	Pension Plan for Executive Employees of CPI Canada, Inc. (as applicable to O. Joe Caldarelli) effective January 1, 2002	CPI's Annual Report on Form 10-K for the fiscal year ended October 3, 2003.
	10.27	First Amendment and Restatement of the CPI Non-Qualified Deferred Compensation Plan effective as of December 1, 2004	Predecessor's Form 10-Q filed on February 6, 2008.
	10.28	Employment Agreement, dated as of April 27, 2006, by and between Communications & Power Industries Canada Inc. and O. Joe Caldarelli	Predecessor's Form 10-Q filed on May 15, 2006
	10.29	Amended and Restated Employment Agreement, dated as of January 17, 2008, by and between CPI and Robert A. Fickett	Predecessor's Form 10-Q filed on February 6, 2008.
	10.30	Amended and Restated Employment Agreement, dated as of January 17, 2008, by and between CPI and Joel A. Littman	Predecessor's Form 10-Q filed on February 6, 2008.
	10.31	Employment Agreement, dated November 2, 2002, by and between CPI and Don Coleman	CPI's Annual Report on Form 10-K for the fiscal year ended October 3, 2003.
	10.32	Form of Indemnification Agreement	Predecessor's Registration Statement on Form S-1/A filed on April 11, 2006 (Commission File No. 333-130662)
	10.33	Form of Stock Option Agreement (Senior Executives) under 2006 Equity and Performance Incentive Plan	Predecessor's Form 8-K filed on December 13, 2006.

Ex-4

Exhibit		Description	Incorporated by Reference to:
	10.34	Form of Stock Option Agreement under 2006 Equity and Performance Incentive Plan	Predecessor's Form 8-K filed on December 13, 2006.
	10.35	Employment Agreement, dated June 27, 2000, by and between CPI and John R. Beighley	Predecessor's Form 10-Q filed on February 12, 2007.
	10.36	Form of Restricted Stock Agreement (Senior Executives) under 2006 Equity and Performance Incentive Plan	Predecessor's Form 8-K filed on December 11, 2007.
	10.37	Form of Restricted Stock Agreement under 2006 Equity and Performance Incentive Plan	Predecessor's Form 8-K filed on December 11, 2007.
	10.38	Form of Restricted Stock Unit Award Agreement (Senior Executives) under 2006 Equity and Performance Incentive Plan	Predecessor's Form 8-K filed on December 11, 2007.
	10.39	Form of Restricted Stock Unit Award Agreement under 2006 Equity and Performance Incentive Plan	Predecessor's Form 8-K filed on December 11, 2007.
	10.40	Employment Agreement, dated June 21, 2004, by and between CPI and Andrew Tafler	Predecessor's Form 10-K filed on December 15, 2008.
	10.41	New Form of Performance Stock Option Agreement (Senior Executives) under 2006 Equity and Performance Incentive Plan	Predecessor's Form 10-K filed on December 15, 2008.
	10.42	New Form of Performance Stock Option Agreement under 2006 Equity and Performance Incentive Plan	Predecessor's Form 10-K filed on December 15, 2008.
	10.43	New Form of Performance Restricted Stock Agreement (Senior Executives) under 2006 Equity and Performance Incentive Plan	Predecessor's Form 10-K filed on December 15, 2008.
	10.44	New Form of Performance Restricted Stock Agreement under 2006 Equity and Performance Incentive Plan	Predecessor's Form 10-K filed on December 15, 2008.
	10.45	New Form of Performance Restricted Stock Unit Award Agreement (Senior Executives) under 2006 Equity and Performance Incentive Plan	Predecessor's Form 10-K filed on December 15, 2008.
	10.46	New Form of Performance Restricted Stock Unit Award Agreement under 2006 Equity and Performance Incentive Plan	Predecessor's Form 10-K filed on December 15, 2008.
	12.1	Computation of Earnings to Fixed Charges	Filed herewith.
	21.1	List of Subsidiaries	Filed herewith.
	23.1	Consent of Skadden, Arps, Slate, Meagher & Flom LLP (included in Exhibit 5.1).	Filed herewith.
	23.2	Consent of KPMG LLP	Filed herewith
	23.3	Consent of KPMG LLP	Filed herewith.
	25.1	Statement of Eligibility of The Bank of New York Mellon Trust Company, N.A., Trustee, as set forth on Form T-1	Filed herewith.
	99.1	Form of Letter of Transmittal	Filed herewith.
	99.2	Form of Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees	Filed herewith.
	99.3	Form of Letter to Clients	Filed herewith.

Ex-5

EX-3.1

Exhibit 3.1

CERTIFICATE OF INCORPORATION

OF

CATALYST HOLDINGS, INC.

FIRST:  The name of the corporation is Catalyst Holdings, Inc. (the “Corporation”).

SECOND:  The address of the registered office of the Corporation in the State of Delaware is 615 South DuPont Highway, in the City of Dover, County of Kent.  The name of its registered agent at that address is National Corporate Research, Ltd.

THIRD:  The purpose of the Corporation is to engage in any lawful act or activity for which a corporation may be organized under the General Corporation Law of the State of Delaware as set forth in Title 8 of the Delaware Code (the “GCL”).

FOURTH:  The total number of shares of stock which the Corporation shall have authority to issue is 1,000 shares of Common Stock, each having a par value of one penny ($.01).

FIFTH:  The name and mailing address of the Sole Incorporator is as follows:

Name	Address
Mary Keogh	P.O. Box 636
	Wilmington, DE 19899

SIXTH:  The following provisions are inserted for the management of the business and the conduct of the affairs of the Corporation, and for further definition, limitation and regulation of the powers of the Corporation and of its directors and stockholders:

(1) The business and affairs of the Corporation shall be managed by or under the direction of the board of directors of the Corporation (the “Board of Directors”).

(2) The directors shall have concurrent power with the stockholders to make, alter, amend, change, add to or repeal the By-Laws of the Corporation.

(3) The number of directors of the Corporation shall be as from time to time fixed by, or in the manner provided in, the By-Laws of the Corporation.  Election of directors need not be by written ballot unless the By-Laws so provide.

(4) No director shall be personally liable to the Corporation or any of its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any breach of the director’s duty of loyalty to the Corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) pursuant to Section 174 of the GCL or (iv) for any transaction from which the director derived an improper personal benefit.  Any repeal or modification of this Article SIXTH by the stockholders of the Corporation shall not adversely affect any right or protection of a director of the Corporation existing at the time of such repeal or modification with respect to acts or omissions occurring prior to such repeal or modification.

(5) In addition to the powers and authority hereinbefore or by statute expressly conferred upon them, the directors are hereby empowered to exercise all such powers and do all such acts and things as may be exercised or done by the Corporation, subject, nevertheless, to the provisions of the GCL, this Certificate of Incorporation, and any By-Laws adopted by the stockholders; provided, however, that no By-Laws hereafter adopted by the stockholders shall invalidate any prior act of the directors which would have been valid if such By-Laws had not been adopted.

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SEVENTH:  Meetings of stockholders may be held within or without the State of Delaware, as the By-Laws may provide.  The books of the Corporation may be kept (subject to any provision contained in the GCL) outside the State of Delaware at such place or places as may be designated from time to time by the Board of Directors or in the By-Laws of the Corporation.

EIGHTH:  The Corporation reserves the right to amend, alter, change or repeal any provision contained in this Certificate of Incorporation, in the manner now or hereafter prescribed by statute, and all rights conferred upon stockholders herein are granted subject to this reservation.

I, THE UNDERSIGNED, being the Sole Incorporator hereinbefore named, for the purpose of forming a corporation pursuant to the GCL, do make this Certificate, hereby declaring and certifying that this is my act and deed and the facts herein stated are true, and accordingly have hereunto set my hand this 24th day of November, 2010.

/s/ Mary Keogh

Mary Keogh

Sole Incorporator

3

CERTIFICATE OF AMENDMENT

TO THE

CERTIFICATE OF INCORPORATION

OF

CATALYST HOLDINGS, INC.

Pursuant to Section 242 of the General

Corporation Law of the State of Delaware

Catalyst Holdings, Inc., a Delaware corporation (hereinafter called the “Corporation”), does hereby certify as follows:

FIRST:  Article FIRST of the Corporation’s Certificate of Incorporation is hereby amended to read in its entirety as set forth below:

FIRST:  The name of the corporation is CPI International Acquisition, Inc. (hereinafter the “Corporation”).

SECOND:  The foregoing amendment was duly adopted in accordance with Section 141(f) and Section 242 of the General Corporation Law of the State of Delaware.

IN WITNESS WHEREOF, the Corporation has caused this Certificate to be duly executed in its corporate name this 26th day of January, 2011.

CATALYST HOLDINGS, INC.
By:	/s/ Jeffrey P. Kelly
Name:	Jeffrey P. Kelly
Title:	Treasurer & Assistant Secretary

4

CERTIFICATE OF AMENDMENT

TO THE

CERTIFICATE OF INCORPORATION

OF

CPI INTERNATIONAL ACQUISITION, INC.

Pursuant to Section 242 of the General

Corporation Law of the State of Delaware

CPI International Acquisition, Inc., a Delaware corporation (hereinafter called the “Corporation”), does hereby certify as follows:

FIRST:  Article FOURTH of the Corporation’s Certificate of Incorporation is hereby amended to read in its entirety as set forth below:

FOURTH:  The total number of shares of stock which the Corporation shall have authority to issue is 2,000 shares of Common Stock, each having a par value of one penny ($.01).

SECOND:  The foregoing amendment was duly adopted in accordance with Section 141(f) and Section 242 of the General Corporation Law of the State of Delaware.

[remainder of page intentionally left blank]

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IN WITNESS WHEREOF, the Corporation has caused this Certificate to be duly executed in its corporate name this 10th day of February, 2011.

CPI INTERNATIONAL ACQUISITION, INC.
By:	/s/ Jeffrey P. Kelly
Name:	Jeffrey P. Kelly
Title:	Treasurer & Assistant Secretary

6

CERTIFICATE OF AMENDMENT

TO THE

CERTIFICATE OF INCORPORATION

OF

CPI INTERNATIONAL ACQUISITION, INC.

Pursuant to Section 242 of the General

Corporation Law of the State of Delaware

CPI International Acquisition, Inc., a Delaware corporation (hereinafter called the “Corporation”), does hereby certify as follows:

FIRST:  Article FIRST of the Corporation’s Certificate of Incorporation is hereby amended to read in its entirety as set forth below:

FIRST:  The name of the corporation is CPI International, Inc. (hereinafter the “Corporation”).

SECOND:  The foregoing amendment was duly adopted in accordance with Section 141(f) and Section 242 and of the General Corporation Law of the State of Delaware.

THIRD:  This Certificate of Amendment shall be effective at 8:53 a.m. on February 11, 2011.

[remainder of page intentionally left blank]

7

IN WITNESS WHEREOF, the Corporation has caused this Certificate to be duly executed in its corporate name this 10th day of February, 2011.

CPI INTERNATIONAL ACQUISITION, INC.
By:	/s/ Hugh D. Evans
Name:	Hugh D. Evans
Title:	Assistant Secretary

8

EX-3.2

Exhibit 3.2

BY-LAWS

OF

CATALYST HOLDINGS, INC.

A Delaware Corporation

Effective November 24, 2010

TABLE OF CONTENTS

		Page
	ARTICLE I
	OFFICES
Section 1.1	Registered Office	1
Section 1.2	Other Offices	1
	ARTICLE II
	MEETINGS OF STOCKHOLDERS
Section 2.1	Place of Meetings	1
Section 2.2	Annual Meetings	1
Section 2.3	Special Meetings	1
Section 2.4	Notice	1
Section 2.5	Adjournments	2
Section 2.6	Quorum	2
Section 2.7	Voting	2
Section 2.8	Proxies	2
Section 2.9	Consent of Stockholders in Lieu of Meeting	3
Section 2.10	List of Stockholders Entitled to Vote	4
Section 2.11	Record Date.	4
Section 2.12	Stock Ledger	5
Section 2.13	Conduct of Meetings	5
Section 2.14	Inspectors of Election	5
	ARTICLE III
	DIRECTORS
Section 3.1	Number and Election of Directors	6
Section 3.2	Vacancies	6
Section 3.3	Duties and Powers	6
Section 3.4	Meetings	6
Section 3.5	Organization	7
Section 3.6	Resignations and Removals of Directors	7
Section 3.7	Quorum	7
Section 3.8	Actions of the Board by Written Consent	7
Section 3.9	Meetings by Means of Conference Telephone	8
Section 3.10	Committees	8
Section 3.11	Compensation	8
Section 3.12	Interested Directors	9

	ARTICLE IV
	OFFICERS
Section 4.1	General	9
Section 4.2	Election	9
Section 4.3	Voting Securities Owned by the Corporation	10
Section 4.4	Chairman of the Board of Directors	10
Section 4.5	President	10
Section 4.6	Vice Presidents	10
Section 4.7	Secretary	11
Section 4.8	Treasurer	11
Section 4.9	Assistant Secretaries	12
Section 4.10	Assistant Treasurers	12
Section 4.11	Other Officers	12
	ARTICLE V
	STOCK
Section 5.1	Form of Certificates	12
Section 5.2	Signatures	12
Section 5.3	Lost Certificates	12
Section 5.4	Transfers	13
Section 5.5	Dividend Record Date	13
Section 5.6	Record Owners	13
Section 5.7	Transfer and Registry Agents	13
	ARTICLE VI
	NOTICES
Section 6.1	Notices	14
Section 6.2	Waivers of Notice	14
	ARTICLE VII
	GENERAL PROVISIONS
Section 7.1	Dividends	14
Section 7.2	Disbursements	14
Section 7.3	Fiscal Year	15
Section 7.4	Corporate Seal	15
	ARTICLE VIII
	INDEMNIFICATION
Section 8.1	Power to Indemnify in Actions, Suits or Proceedings other than Those by or in the Right of the Corporation	15
Section 8.2	Power to Indemnify in Actions, Suits or Proceedings by or in the Right of the Corporation	15
Section 8.3	Authorization of Indemnification	16

Section 8.4	Good Faith Defined	16
Section 8.5	Indemnification by a Court	16
Section 8.6	Expenses Payable in Advance	17
Section 8.7	Nonexclusivity of Indemnification and Advancement of Expenses	17
Section 8.8	Insurance	17
Section 8.9	Certain Definitions	17
Section 8.10	Survival of Indemnification and Advancement of Expenses	18
Section 8.11	Limitation on Indemnification	18
Section 8.12	Indemnification of Employees and Agents	18
	ARTICLE IX
	AMENDMENTS
Section 9.1	Amendments	18
Section 9.2	Entire Board of Directors	19

BY-LAWS
OF
CATALYST HOLDINGS, INC.
(hereinafter called the “Corporation”)

ARTICLE I
OFFICES

Section 1.1Registered Office.  The registered office of the Corporation shall be in the City of Dover, County of Kent, State of Delaware.

Section 1.2Other Offices.  The Corporation may also have offices at such other places, both within and without the State of Delaware, as the Board of Directors may from time to time determine.

ARTICLE II
MEETINGS OF STOCKHOLDERS

Section 2.1Place of Meetings.  Meetings of the stockholders for the election of directors or for any other purpose shall be held at such time and place, either within or without the State of Delaware, as shall be designated from time to time by the Board of Directors.

Section 2.2Annual Meetings.  The Annual Meeting of Stockholders for the election of directors shall be held on such date and at such time as shall be designated from time to time by the Board of Directors.  Any other proper business may be transacted at the Annual Meeting of Stockholders.

Section 2.3Special Meetings.  Unless otherwise required by law or by the certificate of incorporation of the Corporation, as amended and restated from time to time (the “Certificate of Incorporation”), Special Meetings of Stockholders, for any purpose or purposes, may be called by either (i) the Chairman, if there be one, or (ii) the President, (iii) any Vice President, if there be one, (iv) the Secretary or (v) any Assistant Secretary, if there be one, and shall be called by any such officer at the request in writing of (i) the Board of Directors, (ii) a committee of the Board of Directors that has been duly designated by the Board of Directors and whose powers and authority include the power to call such meetings or (iii) stockholders owning a majority of the capital stock of the Corporation issued and outstanding and entitled to vote.  Such request shall state the purpose or purposes of the proposed meeting.  At a Special Meeting of Stockholders, only such business shall be conducted as shall be specified in the notice of meeting (or any supplement thereto).

Section 2.4Notice.  Whenever stockholders are required or permitted to take any action at a meeting, a written notice of the meeting shall be given which shall state the place, date and hour of the meeting, and, in the case of a Special Meeting, the purpose or purposes for which the meeting is called.  Unless otherwise required by law, written notice of any meeting shall be given not less than ten (10) nor more than sixty (60)

1

days before the date of the meeting to each stockholder entitled to notice of and to vote at such meeting.

Section 2.5Adjournments.  Any meeting of the stockholders may be adjourned from time to time to reconvene at the same or some other place, and notice need not be given of any such adjourned meeting if the time and place thereof are announced at the meeting at which the adjournment is taken.  At the adjourned meeting, the Corporation may transact any business which might have been transacted at the original meeting.  If the adjournment is for more than thirty (30) days, or if after the adjournment a new record date is fixed for the adjourned meeting, notice of the adjourned meeting in accordance with the requirements of Section 4 hereof shall be given to each stockholder of record entitled to notice of and to vote at the meeting.

Section 2.6Quorum.  Unless otherwise required by applicable law or the Certificate of Incorporation, the holders of a majority of the Corporation’s capital stock issued and outstanding and entitled to vote thereat, present in person or represented by proxy, shall constitute a quorum at all meetings of the stockholders for the transaction of business.  A quorum, once established, shall not be broken by the withdrawal of enough votes to leave less than a quorum.  If, however, such quorum shall not be present or represented at any meeting of the stockholders, the stockholders entitled to vote thereat, present in person or represented by proxy, shall have power to adjourn the meeting from time to time, in the manner provided in Section 5 hereof, until a quorum shall be present or represented.

Section 2.7Voting.  Unless otherwise required by law, the Certificate of Incorporation or these By-Laws or permitted by the rules of any stock exchange on which the Corporation’s shares are listed and traded, any question brought before any meeting of the stockholders, other than the election of directors, shall be decided by the vote of the holders of a majority of the total number of votes of the Corporation’s capital stock represented at the meeting and entitled to vote on such question, voting as a single class.  Unless otherwise provided in the Certificate of Incorporation, and subject to Section 11(a) of this Article II, each stockholder represented at a meeting of the stockholders shall be entitled to cast one (1) vote for each share of the capital stock entitled to vote thereat held by such stockholder.  Such votes may be cast in person or by proxy as provided in Section 8 of this Article II.  The Board of Directors, in its discretion, or the officer of the Corporation presiding at a meeting of the stockholders, in such officer’s discretion, may require that any votes cast at such meeting shall be cast by written ballot.

Section 2.8Proxies.  Each stockholder entitled to vote at a meeting of the stockholders or to express consent or dissent to corporate action in writing without a meeting may authorize another person or persons to act for such stockholder as proxy, but no such proxy shall be voted upon after three years from its date, unless such proxy provides for a longer period.  Without limiting the manner in which a stockholder may authorize another person or persons to act for such stockholder as proxy, the following shall constitute a valid means by which a stockholder may grant such authority:

2

(i)A stockholder may execute a writing authorizing another person or persons to act for such stockholder as proxy.  Execution may be accomplished by the stockholder or such stockholder’s authorized officer, director, employee or agent signing such writing or causing such person’s signature to be affixed to such writing by any reasonable means, including, but not limited to, by facsimile signature.

(ii)A stockholder may authorize another person or persons to act for such stockholder as proxy by transmitting or authorizing the transmission of a telegram or cablegram to the person who will be the holder of the proxy or to a proxy solicitation firm, proxy support service organization or like agent duly authorized by the person who will be the holder of the proxy to receive such telegram or cablegram, provided that any such telegram or cablegram must either set forth or be submitted with information from which it can be determined that the telegram or cablegram was authorized by the stockholder.  If it is determined that such telegrams or cablegrams are valid, the inspectors or, if there are no inspectors, such other persons making that determination shall specify the information on which they relied.

Any copy, facsimile telecommunication or other reliable reproduction of the writing, telegram or cablegram authorizing another person or persons to act as proxy for a stockholder may be substituted or used in lieu of the original writing, telegram or cablegram for any and all purposes for which the original writing, telegram or cablegram could be used; provided, however, that such copy, facsimile telecommunication or other reproduction shall be a complete reproduction of the entire original writing, telegram or cablegram.

Section 2.9Consent of Stockholders in Lieu of Meeting.  Unless otherwise provided in the Certificate of Incorporation, any action required or permitted to be taken at any Annual or Special Meeting of Stockholders of the Corporation may be taken without a meeting, without prior notice and without a vote, if a consent or consents in writing, setting forth the action so taken, shall be signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted and shall be delivered to the Corporation by delivery to its registered office in the State of Delaware, its principal place of business, or an officer or agent of the Corporation having custody of the book in which proceedings of meetings of the stockholders are recorded.  Delivery made to the Corporation’s registered office shall be by hand or by certified or registered mail, return receipt requested.  Every written consent shall bear the date of signature of each stockholder who signs the consent and no written consent shall be effective to take the corporate action referred to therein unless, within sixty (60) days of the earliest dated consent delivered in the manner required by this Section 9 to the Corporation, written consents signed by a sufficient number of holders to take action are delivered to the Corporation by delivery to its registered office in the State of Delaware, its principal place of business, or an officer or agent of the Corporation having custody of the book in which proceedings of meetings of the stockholders are

3

recorded.  Any copy, facsimile or other reliable reproduction of a consent in writing may be substituted or used in lieu of the original writing for any and all purposes for which the original writing could be used, provided that such copy, facsimile or other reproduction shall be a complete reproduction of the entire original writing.  Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given to those stockholders who have not consented in writing and who, if the action had been taken at a meeting, would have been entitled to notice of the meeting if the record date for such meeting had been the date that written consents signed by a sufficient number of holders to take the action were delivered to the Corporation as provided above in this Section 9.

Section 2.10List of Stockholders Entitled to Vote.  The officer of the Corporation who has charge of the stock ledger of the Corporation shall prepare and make, at least ten (10) days before every meeting of the stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder.  Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten (10) days prior to the meeting (i) either at a place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting, or, if not so specified, at the place where the meeting is to be held or (ii) during ordinary business hours, at the principal place of business of the Corporation.  The list shall also be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder who is present.

Section 2.11Record Date.

(a)In order that the Corporation may determine the stockholders entitled to notice of or to vote at any meeting of the stockholders or any adjournment thereof, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which record date shall not be more than sixty (60) nor less than ten (10) days before the date of such meeting.  If no record date is fixed by the Board of Directors, the record date for determining stockholders entitled to notice of or to vote at a meeting of the stockholders shall be at the close of business on the day next preceding the day on which notice is given, or, if notice is waived, at the close of business on the day next preceding the day on which the meeting is held.  A determination of stockholders of record entitled to notice of or to vote at a meeting of the stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for the adjourned meeting.

(b)In order that the Corporation may determine the stockholders entitled to consent to corporate action in writing without a meeting, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which record date shall not be more than ten (10) days after the date upon which the resolution fixing the record date is adopted by the Board of Directors.  If no record date

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has been fixed by the Board of Directors, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting, when no prior action by the Board of Directors is required by applicable law, shall be the first date on which a signed written consent setting forth the action taken or proposed to be taken is delivered to the Corporation by delivery to its registered office in the State of Delaware, its principal place of business, or an officer or agent of the Corporation having custody of the book in which proceedings of meetings of the stockholders are recorded.  Delivery made to the Corporation’s registered office shall be by hand or by certified or registered mail, return receipt requested.  If no record date has been fixed by the Board of Directors and prior action by the Board of Directors is required by applicable law, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting shall be at the close of business on the day on which the Board of Directors adopts the resolution taking such prior action.

Section 2.12Stock Ledger.  The stock ledger of the Corporation shall be the only evidence as to who are the stockholders entitled to examine the stock ledger, the list required by Section 10 of this Article II or the books of the Corporation, or to vote in person or by proxy at any meeting of the stockholders.

Section 2.13Conduct of Meetings.  The Board of Directors of the Corporation may adopt by resolution such rules and regulations for the conduct of any meeting of the stockholders as it shall deem appropriate.  Except to the extent inconsistent with such rules and regulations as adopted by the Board of Directors, the chairman of any meeting of the stockholders shall have the right and authority to prescribe such rules, regulations and procedures and to do all such acts as, in the judgment of such chairman, are appropriate for the proper conduct of the meeting.  Such rules, regulations or procedures, whether adopted by the Board of Directors or prescribed by the chairman of the meeting, may include, without limitation, the following:  (i) the establishment of an agenda or order of business for the meeting; (ii) the determination of when the polls shall open and close for any given matter to be voted on at the meeting; (iii) rules and procedures for maintaining order at the meeting and the safety of those present; (iv) limitations on attendance at or participation in the meeting to stockholders of record of the Corporation, their duly authorized and constituted proxies or such other persons as the chairman of the meeting shall determine; (v) restrictions on entry to the meeting after the time fixed for the commencement thereof; and (vi) limitations on the time allotted to questions or comments by participants.

Section 2.14Inspectors of Election.  In advance of any meeting of the stockholders, the Board of Directors, by resolution, the Chairman or the President shall appoint one or more inspectors to act at the meeting and make a written report thereof.  One or more other persons may be designated as alternate inspectors to replace any inspector who fails to act.  If no inspector or alternate is able to act at a meeting of the stockholders, the chairman of the meeting shall appoint one or more inspectors to act at the meeting.  Unless otherwise required by applicable law, inspectors may be officers, employees or agents of the Corporation.  Each inspector, before entering upon the discharge of the duties of inspector, shall take and sign an oath faithfully to execute the duties of inspector with strict impartiality and according to the best of such inspector’s

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ability.  The inspector shall have the duties prescribed by law and shall take charge of the polls and, when the vote is completed, shall make a certificate of the result of the vote taken and of such other facts as may be required by applicable law.

ARTICLE III
DIRECTORS

Section 3.1Number and Election of Directors.  The Board of Directors shall consist of not less than one nor more than fifteen members, the exact number of which shall initially be fixed by the Incorporator and thereafter from time to time by the Board of Directors.  Except as provided in Section 2 of this Article III, directors shall be elected by a plurality of the votes cast at each Annual Meeting of Stockholders and each director so elected shall hold office until the next Annual Meeting of Stockholders and until such director’s successor is duly elected and qualified, or until such director’s earlier death, resignation or removal.  Directors need not be stockholders.

Section 3.2Vacancies.  Unless otherwise required by law or the Certificate of Incorporation, vacancies on the Board of Directors or any committee thereof arising through death, resignation, removal, an increase in the number of directors constituting the Board of Directors or such committee or otherwise may be filled only by a majority of the directors then in office, though less than a quorum, or by a sole remaining director. The directors so chosen shall, in the case of the Board of Directors, hold office until the next annual election and until their successors are duly elected and qualified, or until their earlier death, resignation or removal and, in the case of any committee of the Board of Directors, shall hold office until their successors are duly appointed by the Board of Directors or until their earlier death, resignation or removal.

Section 3.3Duties and Powers.  The business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors which may exercise all such powers of the Corporation and do all such lawful acts and things as are not by statute or by the Certificate of Incorporation or by these By-Laws required to be exercised or done by the stockholders.

Section 3.4Meetings.  The Board of Directors and any committee thereof may hold meetings, both regular and special, either within or without the State of Delaware.  Regular meetings of the Board of Directors or any committee thereof may be held without notice at such time and at such place as may from time to time be determined by the Board of Directors or such committee, respectively.  Special meetings of the Board of Directors may be called by the Chairman, if there be one, the President, or by any director.  Special meetings of any committee of the Board of Directors may be called by the chairman of such committee, if there be one, the President, or any director serving on such committee.  Notice thereof stating the place, date and hour of the meeting shall be given to each director (or, in the case of a committee, to each member of such committee) either by mail not less than forty-eight (48) hours before the date of the meeting, by telephone or telegram on twenty-four (24) hours’ notice, or on such shorter notice as the person or persons calling such meeting may deem necessary or appropriate in the circumstances.

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Section 3.5Organization.  At each meeting of the Board of Directors or any committee thereof, the Chairman of the Board of Directors or the chairman of such committee, as the case may be, or, in his or her absence or if there be none, a director chosen by a majority of the directors present, shall act as chairman.  Except as provided below, the Secretary of the Corporation shall act as secretary at each meeting of the Board of Directors and of each committee thereof.  In case the Secretary shall be absent from any meeting of the Board of Directors or of any committee thereof, an Assistant Secretary shall perform the duties of secretary at such meeting; and in the absence from any such meeting of the Secretary and all the Assistant Secretaries, the chairman of the meeting may appoint any person to act as secretary of the meeting.  Notwithstanding the foregoing, the members of each committee of the Board of Directors may appoint any person to act as secretary of any meeting of such committee and the Secretary or any Assistant Secretary of the Corporation may, but need not if such committee so elects, serve in such capacity.

Section 3.6Resignations and Removals of Directors.  Any director of the Corporation may resign from the Board of Directors or any committee thereof at any time, by giving notice in writing to the Chairman of the Board of Directors, if there be one, the President or the Secretary of the Corporation and, in the case of a committee, to the chairman of such committee, if there be one.  Such resignation shall take effect at the time therein specified or, if no time is specified, immediately; and, unless otherwise specified in such notice, the acceptance of such resignation shall not be necessary to make it effective.  Except as otherwise required by applicable law and subject to the rights, if any, of the holders of shares of preferred stock then outstanding, any director or the entire Board of Directors may be removed from office at any time by the affirmative vote of the holders of at least a majority in voting power of the issued and outstanding capital stock of the Corporation entitled to vote in the election of directors.  Any director serving on a committee of the Board of Directors may be removed from such committee at any time by the Board of Directors.

Section 3.7Quorum.  Except as otherwise required by law, the Certificate of Incorporation or the rules and regulations of any securities exchange or quotation system on which the Corporation’s securities are listed or quoted for trading, at all meetings of the Board of Directors or any committee thereof, a majority of the entire Board of Directors or a majority of the directors constituting such committee, as the case may be, shall constitute a quorum for the transaction of business and the act of a majority of the directors or committee members present at any meeting at which there is a quorum shall be the act of the Board of Directors or such committee, as applicable.  If a quorum shall not be present at any meeting of the Board of Directors or any committee thereof, the directors present thereat may adjourn the meeting from time to time, without notice other than announcement at the meeting of the time and place of the adjourned meeting, until a quorum shall be present.

Section 3.8Actions of the Board by Written Consent.  Unless otherwise provided in the Certificate of Incorporation or these By-Laws, any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting, if all the members of the Board of

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Directors or such committee, as the case may be, consent thereto in writing, and the writing or writings are filed with the minutes of proceedings of the Board of Directors or such committee.

Section 3.9Meetings by Means of Conference Telephone.  Unless otherwise provided in the Certificate of Incorporation or these By-Laws, members of the Board of Directors of the Corporation, or any committee thereof, may participate in a meeting of the Board of Directors or such committee by means of a conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and participation in a meeting pursuant to this Section 9 shall constitute presence in person at such meeting.

Section 3.10Committees.  The Board of Directors may designate one or more committees, each committee to consist of one or more of the directors of the Corporation.  Each member of a committee must meet the requirements for membership, if any, imposed by applicable law and the rules and regulations of any securities exchange or quotation system on which the securities of the Corporation are listed or quoted for trading.  The Board of Directors may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of any such committee.  Subject to the rules and regulations of any securities exchange or quotation system on which the securities of the Corporation are listed or quoted for trading, in the absence or disqualification of a member of a committee, and in the absence of a designation by the Board of Directors of an alternate member to replace the absent or disqualified member, the member or members thereof present at any meeting and not disqualified from voting, whether or not such member or members constitute a quorum, may unanimously appoint another qualified member of the Board of Directors to act at the meeting in the place of any absent or disqualified member.  Any committee, to the extent permitted by law and provided in the resolution establishing such committee, shall have and may exercise all the powers and authority of the Board of Directors in the management of the business and affairs of the Corporation, and may authorize the seal of the Corporation to be affixed to all papers which may require it.  Each committee shall keep regular minutes and report to the Board of Directors when required.  Notwithstanding anything to the contrary contained in this Article III, the resolution of the Board of Directors establishing any committee of the Board of Directors and/or the charter of any such committee may establish requirements or procedures relating to the governance and/or operation of such committee that are different from, or in addition to, those set forth in these By-Laws and, to the extent that there is any inconsistency between these By-Laws and any such resolution or charter, the terms of such resolution or charter shall be controlling.

Section 3.11Compensation.  The directors may be paid their expenses, if any, of attendance at each meeting of the Board of Directors and may be paid a fixed sum for attendance at each meeting of the Board of Directors or a stated salary for service as director, payable in cash or securities.  No such payment shall preclude any director from serving the Corporation in any other capacity and receiving compensation therefor.  Members of special or standing committees may be allowed like compensation for service as committee members.

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Section 3.12Interested Directors.  No contract or transaction between the Corporation and one or more of its directors or officers, or between the Corporation and any other corporation, partnership, association or other organization in which one or more of its directors or officers are directors or officers or have a financial interest, shall be void or voidable solely for this reason, or solely because the director or officer is present at or participates in the meeting of the Board of Directors or committee thereof which authorizes the contract or transaction, or solely because any such director’s or officer’s vote is counted for such purpose if: (i) the material facts as to the director’s or officer’s relationship or interest and as to the contract or transaction are disclosed or are known to the Board of Directors or the committee, and the Board of Directors or committee in good faith authorizes the contract or transaction by the affirmative votes of a majority of the disinterested directors, even though the disinterested directors be less than a quorum; or (ii) the material facts as to the director’s or officer’s relationship or interest and as to the contract or transaction are disclosed or are known to the stockholders entitled to vote thereon, and the contract or transaction is specifically approved in good faith by vote of the stockholders; or (iii) the contract or transaction is fair as to the Corporation as of the time it is authorized, approved or ratified by the Board of Directors, a committee thereof or the stockholders.  Common or interested directors may be counted in determining the presence of a quorum at a meeting of the Board of Directors or of a committee which authorizes the contract or transaction.

ARTICLE IV
OFFICERS

Section 4.1General.  The officers of the Corporation shall be chosen by the Board of Directors and shall be a President, a Secretary and a Treasurer.  The Board of Directors, in its discretion, also may choose a Chairman of the Board of Directors (who must be a director) and one or more Vice Presidents, Assistant Secretaries, Assistant Treasurers and other officers.  Any number of offices may be held by the same person, unless otherwise prohibited by law, the Certificate of Incorporation or these By-Laws.  The officers of the Corporation need not be stockholders of the Corporation nor, except in the case of the Chairman of the Board of Directors, need such officers be directors of the Corporation.

Section 4.2Election.  The Board of Directors, at its first meeting held after each Annual Meeting of Stockholders (or action by written consent of stockholders in lieu of the Annual Meeting of Stockholders), shall elect the officers of the Corporation who shall hold their offices for such terms and shall exercise such powers and perform such duties as shall be determined from time to time by the Board of Directors; and each officer of the Corporation shall hold office until such officer’s successor is elected and qualified, or until such officer’s earlier death, resignation or removal.  Any officer elected by the Board of Directors may be removed at any time by the Board of Directors.  Any vacancy occurring in any office of the Corporation shall be filled by the Board of Directors.  The salaries of all officers of the Corporation shall be fixed by the Board of Directors.

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Section 4.3Voting Securities Owned by the Corporation.  Powers of attorney, proxies, waivers of notice of meeting, consents and other instruments relating to securities owned by the Corporation may be executed in the name of and on behalf of the Corporation by the President or any Vice President or any other officer authorized to do so by the Board of Directors and any such officer may, in the name of and on behalf of the Corporation, take all such action as any such officer may deem advisable to vote in person or by proxy at any meeting of security holders of any corporation in which the Corporation may own securities and at any such meeting shall possess and may exercise any and all rights and power incident to the ownership of such securities and which, as the owner thereof, the Corporation might have exercised and possessed if present.  The Board of Directors may, by resolution, from time to time confer like powers upon any other person or persons.

Section 4.4Chairman of the Board of Directors.  The Chairman of the Board of Directors, if there be one, shall preside at all meetings of the stockholders and of the Board of Directors.  The Chairman of the Board of Directors shall be the Chief Executive Officer of the Corporation, unless the Board of Directors designates the President as the Chief Executive Officer, and, except where by law the signature of the President is required, the Chairman of the Board of Directors shall possess the same power as the President to sign all contracts, certificates and other instruments of the Corporation which may be authorized by the Board of Directors.  During the absence or disability of the President, the Chairman of the Board of Directors shall exercise all the powers and discharge all the duties of the President.  The Chairman of the Board of Directors shall also perform such other duties and may exercise such other powers as may from time to time be assigned by these By-Laws or by the Board of Directors.

Section 4.5President.  The President shall, subject to the control of the Board of Directors and, if there be one, the Chairman of the Board of Directors, have general supervision of the business of the Corporation and shall see that all orders and resolutions of the Board of Directors are carried into effect.  The President shall execute all bonds, mortgages, contracts and other instruments of the Corporation requiring a seal, under the seal of the Corporation, except where required or permitted by law to be otherwise signed and executed and except that the other officers of the Corporation may sign and execute documents when so authorized by these By-Laws, the Board of Directors or the President.  In the absence or disability of the Chairman of the Board of Directors, or if there be none, the President shall preside at all meetings of the stockholders and, provided the President is also a director, the Board of Directors.  If there be no Chairman of the Board of Directors, or if the Board of Directors shall otherwise designate, the President shall be the Chief Executive Officer of the Corporation.  The President shall also perform such other duties and may exercise such other powers as may from time to time be assigned to such officer by these By-Laws or by the Board of Directors.

Section 4.6Vice Presidents.  At the request of the President or in the President’s absence or in the event of the President’s inability or refusal to act (and if there be no Chairman of the Board of Directors), the Vice President, or the Vice Presidents if there are more than one (in the order designated by the Board of Directors),

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shall perform the duties of the President, and when so acting, shall have all the powers of and be subject to all the restrictions upon the President.  Each Vice President shall perform such other duties and have such other powers as the Board of Directors from time to time may prescribe.  If there be no Chairman of the Board of Directors and no Vice President, the Board of Directors shall designate the officer of the Corporation who, in the absence of the President or in the event of the inability or refusal of the President to act, shall perform the duties of the President, and when so acting, shall have all the powers of and be subject to all the restrictions upon the President.

Section 4.7Secretary.  The Secretary shall attend all meetings of the Board of Directors and all meetings of the stockholders and record all the proceedings thereat in a book or books to be kept for that purpose; the Secretary shall also perform like duties for committees of the Board of Directors when required.  The Secretary shall give, or cause to be given, notice of all meetings of the stockholders and special meetings of the Board of Directors, and shall perform such other duties as may be prescribed by the Board of Directors, the Chairman of the Board of Directors or the President, under whose supervision the Secretary shall be.  If the Secretary shall be unable or shall refuse to cause to be given notice of all meetings of the stockholders and special meetings of the Board of Directors, and if there be no Assistant Secretary, then either the Board of Directors or the President may choose another officer to cause such notice to be given.  The Secretary shall have custody of the seal of the Corporation and the Secretary or any Assistant Secretary, if there be one, shall have authority to affix the same to any instrument requiring it and when so affixed, it may be attested by the signature of the Secretary or by the signature of any such Assistant Secretary.  The Board of Directors may give general authority to any other officer to affix the seal of the Corporation and to attest to the affixing by such officer’s signature.  The Secretary shall see that all books, reports, statements, certificates and other documents and records required by law to be kept or filed are properly kept or filed, as the case may be.

Section 4.8Treasurer.  The Treasurer shall have the custody of the corporate funds and securities and shall keep full and accurate accounts of receipts and disbursements in books belonging to the Corporation and shall deposit all moneys and other valuable effects in the name and to the credit of the Corporation in such depositories as may be designated by the Board of Directors.  The Treasurer shall disburse the funds of the Corporation as may be ordered by the Board of Directors, taking proper vouchers for such disbursements, and shall render to the President and the Board of Directors, at its regular meetings, or when the Board of Directors so requires, an account of all transactions as Treasurer and of the financial condition of the Corporation.  If required by the Board of Directors, the Treasurer shall give the Corporation a bond in such sum and with such surety or sureties as shall be satisfactory to the Board of Directors for the faithful performance of the duties of the office of the Treasurer and for the restoration to the Corporation, in case of the Treasurer’s death, resignation, retirement or removal from office, of all books, papers, vouchers, money and other property of whatever kind in the Treasurer’s possession or under the Treasurer’s control belonging to the Corporation.

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Section 4.9Assistant Secretaries.  Assistant Secretaries, if there be any, shall perform such duties and have such powers as from time to time may be assigned to them by the Board of Directors, the President, any Vice President, if there be one, or the Secretary, and in the absence of the Secretary or in the event of the Secretary’s inability or refusal to act, shall perform the duties of the Secretary, and when so acting, shall have all the powers of and be subject to all the restrictions upon the Secretary.

Section 4.10Assistant Treasurers.  Assistant Treasurers, if there be any, shall perform such duties and have such powers as from time to time may be assigned to them by the Board of Directors, the President, any Vice President, if there be one, or the Treasurer, and in the absence of the Treasurer or in the event of the Treasurer’s inability or refusal to act, shall perform the duties of the Treasurer, and when so acting, shall have all the powers of and be subject to all the restrictions upon the Treasurer.  If required by the Board of Directors, an Assistant Treasurer shall give the Corporation a bond in such sum and with such surety or sureties as shall be satisfactory to the Board of Directors for the faithful performance of the duties of the office of Assistant Treasurer and for the restoration to the Corporation, in case of the Assistant Treasurer’s death, resignation, retirement or removal from office, of all books, papers, vouchers, money and other property of whatever kind in the Assistant Treasurer’s possession or under the Assistant Treasurer’s control belonging to the Corporation.

Section 4.11Other Officers.  Such other officers as the Board of Directors may choose shall perform such duties and have such powers as from time to time may be assigned to them by the Board of Directors.  The Board of Directors may delegate to any other officer of the Corporation the power to choose such other officers and to prescribe their respective duties and powers.

ARTICLE V
STOCK

Section 5.1Form of Certificates.  Every holder of stock in the Corporation shall be entitled to have a certificate signed by, or in the name of the Corporation (i) by the Chairman of the Board of Directors, or the President or a Vice President and (ii) by the Treasurer or an Assistant Treasurer, or the Secretary or an Assistant Secretary of the Corporation, certifying the number of shares owned by such stockholder in the Corporation.

Section 5.2Signatures.  Any or all of the signatures on a certificate may be a facsimile.  In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the Corporation with the same effect as if such person were such officer, transfer agent or registrar at the date of issue.

Section 5.3Lost Certificates.  The Board of Directors may direct a new certificate to be issued in place of any certificate theretofore issued by the Corporation alleged to have been lost, stolen or destroyed, upon the making of an affidavit of that fact

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by the person claiming the certificate of stock to be lost, stolen or destroyed.  When authorizing such issuance of a new certificate, the Board of Directors may, in its discretion and as a condition precedent to the issuance thereof, require the owner of such lost, stolen or destroyed certificate, or such owner’s legal representative, to advertise the same in such manner as the Board of Directors shall require and/or to give the Corporation a bond in such sum as it may direct as indemnity against any claim that may be made against the Corporation on account of the alleged loss, theft or destruction of such certificate or the issuance of such new certificate.

Section 5.4Transfers.  Stock of the Corporation shall be transferable in the manner prescribed by applicable law and in these By-Laws.  Transfers of stock shall be made on the books of the Corporation only by the person named in the certificate or by such person’s attorney lawfully constituted in writing and upon the surrender of the certificate therefor, properly endorsed for transfer and payment of all necessary transfer taxes; provided, however, that such surrender and endorsement or payment of taxes shall not be required in any case in which the officers of the Corporation shall determine to waive such requirement.  Every certificate exchanged, returned or surrendered to the Corporation shall be marked “Cancelled,” with the date of cancellation, by the Secretary or Assistant Secretary of the Corporation or the transfer agent thereof.  No transfer of stock shall be valid as against the Corporation for any purpose until it shall have been entered in the stock records of the Corporation by an entry showing from and to whom transferred.

Section 5.5Dividend Record Date.  In order that the Corporation may determine the stockholders entitled to receive payment of any dividend or other distribution or allotment of any rights or the stockholders entitled to exercise any rights in respect of any change, conversion or exchange of stock, or for the purpose of any other lawful action, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted, and which record date shall be not more than sixty (60) days prior to such action.  If no record date is fixed, the record date for determining stockholders for any such purpose shall be at the close of business on the day on which the Board of Directors adopts the resolution relating thereto.

Section 5.6Record Owners.  The Corporation shall be entitled to recognize the exclusive right of a person registered on its books as the owner of shares to receive dividends, and to vote as such owner, and to hold liable for calls and assessments a person registered on its books as the owner of shares, and shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise required by law.

Section 5.7Transfer and Registry Agents.  The Corporation may from time to time maintain one or more transfer offices or agencies and registry offices or agencies at such place or places as may be determined from time to time by the Board of Directors.

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ARTICLE VI
NOTICES

Section 6.1Notices.  Whenever written notice is required by law, the Certificate of Incorporation or these By-Laws, to be given to any director, member of a committee or stockholder, such notice may be given by mail, addressed to such director, member of a committee or stockholder, at such person’s address as it appears on the records of the Corporation, with postage thereon prepaid, and such notice shall be deemed to be given at the time when the same shall be deposited in the United States mail.  Written notice may also be given personally or by telegram, telex or cable.

Section 6.2Waivers of Notice.  Whenever any notice is required by applicable law, the Certificate of Incorporation or these By-Laws, to be given to any director, member of a committee or stockholder, a waiver thereof in writing, signed by the person or persons entitled to notice, whether before or after the time stated therein, shall be deemed equivalent thereto.  Attendance of a person at a meeting, present in person or represented by proxy, shall constitute a waiver of notice of such meeting, except where the person attends the meeting for the express purpose of objecting at the beginning of the meeting to the transaction of any business because the meeting is not lawfully called or convened.  Neither the business to be transacted at, nor the purpose of, any Annual or Special Meeting of Stockholders or any regular or special meeting of the directors or members of a committee of directors need be specified in any written waiver of notice unless so required by law, the Certificate of Incorporation or these By-Laws.

ARTICLE VII
GENERAL PROVISIONS

Section 7.1Dividends.  Dividends upon the capital stock of the Corporation, subject to the requirements of the General Corporation Law of the State of Delaware (the “DGCL”) and the provisions of the Certificate of Incorporation, if any, may be declared by the Board of Directors at any regular or special meeting of the Board of Directors (or any action by written consent in lieu thereof in accordance with Section 8 of Article III hereof), and may be paid in cash, in property, or in shares of the Corporation’s capital stock.  Before payment of any dividend, there may be set aside out of any funds of the Corporation available for dividends such sum or sums as the Board of Directors from time to time, in its absolute discretion, deems proper as a reserve or reserves to meet contingencies, or for purchasing any of the shares of capital stock, warrants, rights, options, bonds, debentures, notes, scrip or other securities or evidences of indebtedness of the Corporation, or for equalizing dividends, or for repairing or maintaining any property of the Corporation, or for any proper purpose, and the Board of Directors may modify or abolish any such reserve.

Section 7.2Disbursements.  All checks or demands for money and notes of the Corporation shall be signed by such officer or officers or such other person or persons as the Board of Directors may from time to time designate.

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Section 7.3Fiscal Year.  The fiscal year of the Corporation shall be fixed by resolution of the Board of Directors.

Section 7.4Corporate Seal.  The corporate seal shall have inscribed thereon the name of the Corporation, the year of its organization and the words “Corporate Seal, Delaware”.  The seal may be used by causing it or a facsimile thereof to be impressed or affixed or reproduced or otherwise.

ARTICLE VIII
INDEMNIFICATION

Section 8.1Power to Indemnify in Actions, Suits or Proceedings other than Those by or in the Right of the Corporation.  Subject to Section 3 of this Article VIII, the Corporation shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Corporation), by reason of the fact that such person is or was a director or officer of the Corporation, or is or was a director or officer of the Corporation serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe such person’s conduct was unlawful.  The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which such person reasonably believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, had reasonable cause to believe that such person’s conduct was unlawful.

Section 8.2Power to Indemnify in Actions, Suits or Proceedings by or in the Right of the Corporation.  Subject to Section 3 of this Article VIII, the Corporation shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the Corporation to procure a judgment in its favor by reason of the fact that such person is or was a director or officer of the Corporation, or is or was a director or officer of the Corporation serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection with the defense or settlement of such action or suit if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the Corporation; except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the Corporation unless and only to the extent that the Court of Chancery of the State of Delaware or the court in which such action or suit was brought shall determine upon

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application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court shall deem proper.

Section 8.3Authorization of Indemnification.  Any indemnification under this Article VIII (unless ordered by a court) shall be made by the Corporation only as authorized in the specific case upon a determination that indemnification of the present or former director or officer is proper in the circumstances because such person has met the applicable standard of conduct set forth in Section 1 or Section 2 of this Article VIII, as the case may be.  Such determination shall be made, with respect to a person who is a director or officer at the time of such determination, (i) by a majority vote of the directors who are not parties to such action, suit or proceeding, even though less than a quorum, or (ii) by a committee of such directors designated by a majority vote of such directors, even though less than a quorum, or (iii) if there are no such directors, or if such directors so direct, by independent legal counsel in a written opinion or (iv) by the stockholders.  Such determination shall be made, with respect to former directors and officers, by any person or persons having the authority to act on the matter on behalf of the Corporation.  To the extent, however, that a present or former director or officer of the Corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding described above, or in defense of any claim, issue or matter therein, such person shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection therewith, without the necessity of authorization in the specific case.

Section 8.4Good Faith Defined.  For purposes of any determination under Section 3 of this Article VIII, a person shall be deemed to have acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the Corporation, or, with respect to any criminal action or proceeding, to have had no reasonable cause to believe such person’s conduct was unlawful, if such person’s action is based on the records or books of account of the Corporation or another enterprise, or on information supplied to such person by the officers of the Corporation or another enterprise in the course of their duties, or on the advice of legal counsel for the Corporation or another enterprise or on information or records given or reports made to the Corporation or another enterprise by an independent certified public accountant or by an appraiser or other expert selected with reasonable care by the Corporation or another enterprise.  The provisions of this Section 4 shall not be deemed to be exclusive or to limit in any way the circumstances in which a person may be deemed to have met the applicable standard of conduct set forth in Section 1 or Section 2 of this Article VIII, as the case may be.

Section 8.5Indemnification by a Court.  Notwithstanding any contrary determination in the specific case under Section 3 of this Article VIII, and notwithstanding the absence of any determination thereunder, any director or officer may apply to the Court of Chancery of the State of Delaware or any other court of competent jurisdiction in the State of Delaware for indemnification to the extent otherwise permissible under Section 1 or Section 2 of this Article VIII.  The basis of such indemnification by a court shall be a determination by such court that indemnification of

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the director or officer is proper in the circumstances because such person has met the applicable standard of conduct set forth in Section 1 or Section 2 of this Article VIII, as the case may be.  Neither a contrary determination in the specific case under Section 3 of this Article VIII nor the absence of any determination thereunder shall be a defense to such application or create a presumption that the director or officer seeking indemnification has not met any applicable standard of conduct.  Notice of any application for indemnification pursuant to this Section 5 shall be given to the Corporation promptly upon the filing of such application.  If successful, in whole or in part, the director or officer seeking indemnification shall also be entitled to be paid the expense of prosecuting such application.

Section 8.6Expenses Payable in Advance.  Expenses (including attorneys’ fees) incurred by a director or officer in defending any civil, criminal, administrative or investigative action, suit or proceeding shall be paid by the Corporation in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of such director or officer to repay such amount if it shall ultimately be determined that such person is not entitled to be indemnified by the Corporation as authorized in this Article VIII.  Such  expenses (including attorneys’ fees) incurred by former directors and officers or other employees and agents may be so paid upon such terms and conditions, if any, as the Corporation deems appropriate.

Section 8.7Nonexclusivity of Indemnification and Advancement of Expenses.  The indemnification and advancement of expenses provided by, or granted pursuant to, this Article VIII shall not be deemed exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under the Certificate of Incorporation, these By-Laws, agreement, vote of stockholders or disinterested directors or otherwise, both as to action in such person’s official capacity and as to action in another capacity while holding such office, it being the policy of the Corporation that indemnification of the persons specified in Section 1 and Section 2 of this Article VIII shall be made to the fullest extent permitted by law.  The provisions of this Article VIII shall not be deemed to preclude the indemnification of any person who is not specified in Section 1 or Section 2 of this Article VIII but whom the Corporation has the power or obligation to indemnify under the provisions of the DGCL, or otherwise.

Section 8.8Insurance.  The Corporation may purchase and maintain insurance on behalf of any person who is or was a director or officer of the Corporation, or is or was a director or officer of the Corporation serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against such person and incurred by such person in any such capacity, or arising out of such person’s status as such, whether or not the Corporation would have the power or the obligation to indemnify such person against such liability under the provisions of this Article VIII.

Section 8.9Certain Definitions.  For purposes of this Article VIII, references to “the Corporation” shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had

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power and authority to indemnify its directors or officers, so that any person who is or was a director or officer of such constituent corporation, or is or was a director or officer of such constituent corporation serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, shall stand in the same position under the provisions of this Article VIII with respect to the resulting or surviving corporation as such person would have with respect to such constituent corporation if its separate existence had continued.  The term “another enterprise” as used in this Article VIII shall mean any other corporation or any partnership, joint venture, trust, employee benefit plan or other enterprise of which such person is or was serving at the request of the Corporation as a director, officer, employee or agent.  For purposes of this Article VIII, references to “fines” shall include any excise taxes assessed on a person with respect to an employee benefit plan; and references to “serving at the request of the Corporation” shall include any service as a director, officer, employee or agent of the Corporation which imposes duties on, or involves services by, such director or officer with respect to an employee benefit plan, its participants or beneficiaries; and a person who acted in good faith and in a manner such person reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner “not opposed to the best interests of the Corporation” as referred to in this Article VIII.

Section 8.10Survival of Indemnification and Advancement of Expenses.  The indemnification and advancement of expenses provided by, or granted pursuant to, this Article VIII shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director or officer and shall inure to the benefit of the heirs, executors and administrators of such a person.

Section 8.11Limitation on Indemnification.  Notwithstanding anything contained in this Article VIII to the contrary, except for proceedings to enforce rights to indemnification (which shall be governed by Section 5 of this Article VIII), the Corporation shall not be obligated to indemnify any director or officer (or his or her heirs, executors or personal or legal representatives) or advance expenses in connection with a proceeding (or part thereof) initiated by such person unless such proceeding (or part thereof) was authorized or consented to by the Board of Directors of the Corporation.

Section 8.12Indemnification of Employees and Agents.  The Corporation may, to the extent authorized from time to time by the Board of Directors, provide rights to indemnification and to the advancement of expenses to employees and agents of the Corporation similar to those conferred in this Article VIII to directors and officers of the Corporation.

ARTICLE IX
AMENDMENTS

Section 9.1Amendments.  These By-Laws may be altered, amended or repealed, in whole or in part, or new By-Laws may be adopted by the stockholders or by the Board of Directors; provided, however, that notice of such alteration, amendment, repeal or adoption of new By-Laws be contained in the notice of such meeting of the

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stockholders or Board of Directors, as the case may be.  All such amendments must be approved by either the holders of a majority of the outstanding capital stock entitled to vote thereon or by a majority of the entire Board of Directors then in office.

Section 9.2Entire Board of Directors.  As used in this Article IX and in these By-Laws generally, the term “entire Board of Directors” means the total number of directors which the Corporation would have if there were no vacancies.

* * *

Adopted as of: November 24, 2010

Last Amended as of:                        

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EX-3.3

Exhibit 3.3

CERTIFICATE OF INCORPORATION

OF

CATALYST HOLDINGS 2, INC.

FIRST:  The name of the corporation is Catalyst Holdings 2, Inc. (the “Corporation”).

SECOND:  The address of the registered office of the Corporation in the State of Delaware is 615 South DuPont Highway, in the City of Dover, County of Kent.  The name of its registered agent at that address is National Corporate Research, Ltd.

THIRD:  The purpose of the Corporation is to engage in any lawful act or activity for which a corporation may be organized under the General Corporation Law of the State of Delaware as set forth in Title 8 of the Delaware Code (the “GCL”).

FOURTH:  The total number of shares of stock which the Corporation shall have authority to issue is 1,000 shares of Common Stock, each having a par value of one penny ($.01).

FIFTH:  The name and mailing address of the Sole Incorporator is as follows:

Name	Address
Mary Keogh	P.O. Box 636
	Wilmington, DE 19899

SIXTH:  The following provisions are inserted for the management of the business and the conduct of the affairs of the Corporation, and for further definition, limitation and regulation of the powers of the Corporation and of its directors and stockholders:

(1)  The business and affairs of the Corporation shall be managed by or under the direction of the board of directors of the Corporation (the “Board of Directors”).

(2)  The directors shall have concurrent power with the stockholders to make, alter, amend, change, add to or repeal the By-Laws of the Corporation.

(3)  The number of directors of the Corporation shall be as from time to time fixed by, or in the manner provided in, the By-Laws of the Corporation.  Election of directors need not be by written ballot unless the By-Laws so provide.

(4)  No director shall be personally liable to the Corporation or any of its stockholders for monetary damages for breach of fiduciary duty as a director, except for liability (i) for any breach of the director’s duty of loyalty to the Corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) pursuant to Section 174 of the GCL or (iv) for any transaction from which the director derived an improper personal benefit.  Any repeal or modification of this Article SIXTH by the stockholders of the Corporation shall not adversely affect any right or protection of a director of the Corporation existing at the time of such repeal or modification with respect to acts or omissions occurring prior to such repeal or modification.

(5)  In addition to the powers and authority hereinbefore or by statute expressly conferred upon them, the directors are hereby empowered to exercise all such powers and do all such acts and things as may be exercised or done by the Corporation, subject, nevertheless, to the provisions of the GCL, this Certificate of Incorporation, and any By-Laws adopted by the stockholders; provided, however, that no By-Laws hereafter adopted by the stockholders shall invalidate any prior act of the directors which would have been valid if such By-Laws had not been adopted.

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SEVENTH:  Meetings of stockholders may be held within or without the State of Delaware, as the By-Laws may provide.  The books of the Corporation may be kept (subject to any provision contained in the GCL) outside the State of Delaware at such place or places as may be designated from time to time by the Board of Directors or in the By-Laws of the Corporation.

EIGHTH:  The Corporation reserves the right to amend, alter, change or repeal any provision contained in this Certificate of Incorporation, in the manner now or hereafter prescribed by statute, and all rights conferred upon stockholders herein are granted subject to this reservation.

I, THE UNDERSIGNED, being the Sole Incorporator hereinbefore named, for the purpose of forming a corporation pursuant to the GCL, do make this Certificate, hereby declaring and certifying that this is my act and deed and the facts herein stated are true, and accordingly have hereunto set my hand this 18th day of January, 2011.

/s/ Mary Keogh

Mary Keogh

Sole Incorporator

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CERTIFICATE OF AMENDMENT

TO THE

CERTIFICATE OF INCORPORATION

OF

CATALYST HOLDINGS 2, INC.

Pursuant to Section 242 of the General

Corporation Law of the State of Delaware

Catalyst Holdings 2, Inc., a Delaware corporation (hereinafter called the “Corporation”), does hereby certify as follows:

FIRST:  Article FIRST of the Corporation’s Certificate of Incorporation is hereby amended to read in its entirety as set forth below:

FIRST:  The name of the corporation is CPI International Holding Corp. (hereinafter the “Corporation”).

SECOND:  The foregoing amendment was duly adopted in accordance with Section 141(f) and Section 242 of the General Corporation Law of the State of Delaware.

IN WITNESS WHEREOF, the Corporation has caused this Certificate to be duly executed in its corporate name this 26th day of January, 2011.

CATALYST HOLDINGS 2, INC.
By:	/s/ Jeffrey P. Kelly
Name: Jeffrey P. Kelly
Title: Treasurer & Assistant Secretary

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CERTIFICATE OF AMENDMENT

TO THE

CERTIFICATE OF INCORPORATION

OF

CPI INTERNATIONAL HOLDING CORP.

Pursuant to Section 242 of the General

Corporation Law of the State of Delaware

CPI International Holding Corp., a Delaware corporation (hereinafter called the “Corporation”), does hereby certify as follows:

FIRST:  Article FOURTH of the Corporation’s Certificate of Incorporation is hereby amended to read in its entirety as set forth below:

FOURTH:  The total number of shares of stock which the Corporation shall have authority to issue is 2,000 shares of Common Stock, each having a par value of one penny ($.01).

SECOND:  The foregoing amendment was duly adopted in accordance with Section 141(f) and Section 242 of the General Corporation Law of the State of Delaware.

[remainder of page intentionally left blank]

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IN WITNESS WHEREOF, the Corporation has caused this Certificate to be duly executed in its corporate name this 11th day of February, 2011.

CPI INTERNATIONAL HOLDING CORP.
By:	/s/ Jeffrey P. Kelly
Name:	Jeffrey P. Kelly
Title:	Treasurer & Assistant Secretary

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EX-3.4

Exhibit 3.4

BY-LAWS

OF

CATALYST HOLDINGS 2, INC.

A Delaware Corporation

Effective January 18, 2011

TABLE OF CONTENTS

		Page
ARTICLE I
OFFICES
Section 1.1	Registered Office	1
Section 1.2	Other Offices	1
ARTICLE II
MEETINGS OF STOCKHOLDERS
Section 2.1	Place of Meetings	1
Section 2.2	Annual Meetings	1
Section 2.3	Special Meetings	1
Section 2.4	Notice	2
Section 2.5	Adjournments	2
Section 2.6	Quorum	2
Section 2.7	Voting	2
Section 2.8	Proxies	3
Section 2.9	Consent of Stockholders in Lieu of Meeting	3
Section 2.10	List of Stockholders Entitled to Vote	4
Section 2.11	Record Date.	4
Section 2.12	Stock Ledger	5
Section 2.13	Conduct of Meetings	5
Section 2.14	Inspectors of Election	6
ARTICLE III
DIRECTORS
Section 3.1	Number and Election of Directors	6
Section 3.2	Vacancies	6
Section 3.3	Duties and Powers	7
Section 3.4	Meetings	7
Section 3.5	Organization	7
Section 3.6	Resignations and Removals of Directors	7
Section 3.7	Quorum	8
Section 3.8	Actions of the Board by Written Consent	8
Section 3.9	Meetings by Means of Conference Telephone	8
Section 3.10	Committees	8
Section 3.11	Compensation	9
Section 3.12	Interested Directors	9

ARTICLE IV
OFFICERS
Section 4.1	General	10
Section 4.2	Election	10
Section 4.3	Voting Securities Owned by the Corporation	10
Section 4.4	Chairman of the Board of Directors	11
Section 4.5	President	11
Section 4.6	Vice Presidents	11
Section 4.7	Secretary	12
Section 4.8	Treasurer	12
Section 4.9	Assistant Secretaries	12
Section 4.10	Assistant Treasurers	13
Section 4.11	Other Officers	13
ARTICLE V
STOCK
Section 5.1	Form of Certificates	13
Section 5.2	Signatures	13
Section 5.3	Lost Certificates	13
Section 5.4	Transfers	14
Section 5.5	Dividend Record Date	14
Section 5.6	Record Owners	14
Section 5.7	Transfer and Registry Agents	14
ARTICLE VI
NOTICES
Section 6.1	Notices	15
Section 6.2	Waivers of Notice	15
ARTICLE VII
GENERAL PROVISIONS
Section 7.1	Dividends	15
Section 7.2	Disbursements	15
Section 7.3	Fiscal Year	16
Section 7.4	Corporate Seal	16
ARTICLE VIII
INDEMNIFICATION
Section 8.1	Power to Indemnify in Actions, Suits or Proceedings other than Those by or in the Right of the Corporation	16
Section 8.2	Power to Indemnify in Actions, Suits or Proceedings by or in the Right of the Corporation	16
Section 8.3	Authorization of Indemnification	17

Section 8.4	Good Faith Defined	17
Section 8.5	Indemnification by a Court	17
Section 8.6	Expenses Payable in Advance	18
Section 8.7	Nonexclusivity of Indemnification and Advancement of Expenses	18
Section 8.8	Insurance	18
Section 8.9	Certain Definitions	19
Section 8.10	Survival of Indemnification and Advancement of Expenses	19
Section 8.11	Limitation on Indemnification	19
Section 8.12	Indemnification of Employees and Agents	20
ARTICLE IX
AMENDMENTS
Section 9.1	Amendments	20
Section 9.2	Entire Board of Directors	21

BY-LAWS
OF
CATALYST HOLDINGS 2, INC.
(hereinafter called the “Corporation”)

ARTICLE I
OFFICES

Section 1.1Registered Office.  The registered office of the Corporation shall be in the City of Dover, County of Kent, State of Delaware.

Section 1.2Other Offices.  The Corporation may also have offices at such other places, both within and without the State of Delaware, as the Board of Directors may from time to time determine.

ARTICLE II
MEETINGS OF STOCKHOLDERS

Section 2.1Place of Meetings.  Meetings of the stockholders for the election of directors or for any other purpose shall be held at such time and place, either within or without the State of Delaware, as shall be designated from time to time by the Board of Directors.

Section 2.2Annual Meetings.  The Annual Meeting of Stockholders for the election of directors shall be held on such date and at such time as shall be designated from time to time by the Board of Directors.  Any other proper business may be transacted at the Annual Meeting of Stockholders.

Section 2.3Special Meetings.  Unless otherwise required by law or by the certificate of incorporation of the Corporation, as amended and restated from time to time (the “Certificate of Incorporation”), Special Meetings of Stockholders, for any purpose or purposes, may be called by either (i) the Chairman, if there be one, or (ii) the President, (iii) any Vice President, if there be one, (iv) the Secretary or (v) any Assistant Secretary, if there be one, and shall be called by any such officer at the request in writing of (i) the Board of Directors, (ii) a committee of the Board of Directors that has been duly designated by the Board of Directors and whose powers and authority include the power to call such meetings or (iii) stockholders owning a majority of the capital stock of the Corporation issued and outstanding and entitled to vote.  Such request shall state the purpose or purposes of the proposed meeting.  At a Special Meeting of Stockholders, only such business shall be conducted as shall be specified in the notice of meeting (or any supplement thereto).

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Section 2.4Notice.  Whenever stockholders are required or permitted to take any action at a meeting, a written notice of the meeting shall be given which shall state the place, date and hour of the meeting, and, in the case of a Special Meeting, the purpose or purposes for which the meeting is called.  Unless otherwise required by law, written notice of any meeting shall be given not less than ten (10) nor more than sixty (60) days before the date of the meeting to each stockholder entitled to notice of and to vote at such meeting.

Section 2.5Adjournments.  Any meeting of the stockholders may be adjourned from time to time to reconvene at the same or some other place, and notice need not be given of any such adjourned meeting if the time and place thereof are announced at the meeting at which the adjournment is taken.  At the adjourned meeting, the Corporation may transact any business which might have been transacted at the original meeting.  If the adjournment is for more than thirty (30) days, or if after the adjournment a new record date is fixed for the adjourned meeting, notice of the adjourned meeting in accordance with the requirements of Section 4 hereof shall be given to each stockholder of record entitled to notice of and to vote at the meeting.

Section 2.6Quorum.  Unless otherwise required by applicable law or the Certificate of Incorporation, the holders of a majority of the Corporation’s capital stock issued and outstanding and entitled to vote thereat, present in person or represented by proxy, shall constitute a quorum at all meetings of the stockholders for the transaction of business.  A quorum, once established, shall not be broken by the withdrawal of enough votes to leave less than a quorum.  If, however, such quorum shall not be present or represented at any meeting of the stockholders, the stockholders entitled to vote thereat, present in person or represented by proxy, shall have power to adjourn the meeting from time to time, in the manner provided in Section 5 hereof, until a quorum shall be present or represented.

Section 2.7Voting.  Unless otherwise required by law, the Certificate of Incorporation or these By-Laws or permitted by the rules of any stock exchange on which the Corporation’s shares are listed and traded, any question brought before any meeting of the stockholders, other than the election of directors, shall be decided by the vote of the holders of a majority of the total number of votes of the Corporation’s capital stock represented at the meeting and entitled to vote on such question, voting as a single class.  Unless otherwise provided in the Certificate of Incorporation, and subject to Section 11(a) of this Article II, each stockholder represented at a meeting of the stockholders shall be entitled to cast one (1) vote for each share of the capital stock entitled to vote thereat held by such stockholder.  Such votes may be cast in person or by proxy as provided in Section 8 of this Article II.  The Board of Directors, in its discretion, or the officer of the Corporation presiding at a meeting of the stockholders, in such officer’s discretion, may require that any votes cast at such meeting shall be cast by written ballot.

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Section 2.8Proxies.  Each stockholder entitled to vote at a meeting of the stockholders or to express consent or dissent to corporate action in writing without a meeting may authorize another person or persons to act for such stockholder as proxy, but no such proxy shall be voted upon after three years from its date, unless such proxy provides for a longer period.  Without limiting the manner in which a stockholder may authorize another person or persons to act for such stockholder as proxy, the following shall constitute a valid means by which a stockholder may grant such authority:

(i)A stockholder may execute a writing authorizing another person or persons to act for such stockholder as proxy.  Execution may be accomplished by the stockholder or such stockholder’s authorized officer, director, employee or agent signing such writing or causing such person’s signature to be affixed to such writing by any reasonable means, including, but not limited to, by facsimile signature.

(ii)A stockholder may authorize another person or persons to act for such stockholder as proxy by transmitting or authorizing the transmission of a telegram or cablegram to the person who will be the holder of the proxy or to a proxy solicitation firm, proxy support service organization or like agent duly authorized by the person who will be the holder of the proxy to receive such telegram or cablegram, provided that any such telegram or cablegram must either set forth or be submitted with information from which it can be determined that the telegram or cablegram was authorized by the stockholder.  If it is determined that such telegrams or cablegrams are valid, the inspectors or, if there are no inspectors, such other persons making that determination shall specify the information on which they relied.

Any copy, facsimile telecommunication or other reliable reproduction of the writing, telegram or cablegram authorizing another person or persons to act as proxy for a stockholder may be substituted or used in lieu of the original writing, telegram or cablegram for any and all purposes for which the original writing, telegram or cablegram could be used; provided, however, that such copy, facsimile telecommunication or other reproduction shall be a complete reproduction of the entire original writing, telegram or cablegram.

Section 2.9Consent of Stockholders in Lieu of Meeting.  Unless otherwise provided in the Certificate of Incorporation, any action required or permitted to be taken at any Annual or Special Meeting of Stockholders of the Corporation may be taken without a meeting, without prior notice and without a vote, if a consent or consents in writing, setting forth the action so taken, shall be signed by the holders of outstanding stock having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted and shall be delivered to the Corporation by delivery to its registered

3

office in the State of Delaware, its principal place of business, or an officer or agent of the Corporation having custody of the book in which proceedings of meetings of the stockholders are recorded.  Delivery made to the Corporation’s registered office shall be by hand or by certified or registered mail, return receipt requested.  Every written consent shall bear the date of signature of each stockholder who signs the consent and no written consent shall be effective to take the corporate action referred to therein unless, within sixty (60) days of the earliest dated consent delivered in the manner required by this Section 9 to the Corporation, written consents signed by a sufficient number of holders to take action are delivered to the Corporation by delivery to its registered office in the State of Delaware, its principal place of business, or an officer or agent of the Corporation having custody of the book in which proceedings of meetings of the stockholders are recorded.  Any copy, facsimile or other reliable reproduction of a consent in writing may be substituted or used in lieu of the original writing for any and all purposes for which the original writing could be used, provided that such copy, facsimile or other reproduction shall be a complete reproduction of the entire original writing.  Prompt notice of the taking of the corporate action without a meeting by less than unanimous written consent shall be given to those stockholders who have not consented in writing and who, if the action had been taken at a meeting, would have been entitled to notice of the meeting if the record date for such meeting had been the date that written consents signed by a sufficient number of holders to take the action were delivered to the Corporation as provided above in this Section 9.

Section 2.10List of Stockholders Entitled to Vote.  The officer of the Corporation who has charge of the stock ledger of the Corporation shall prepare and make, at least ten (10) days before every meeting of the stockholders, a complete list of the stockholders entitled to vote at the meeting, arranged in alphabetical order, and showing the address of each stockholder and the number of shares registered in the name of each stockholder.  Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least ten (10) days prior to the meeting (i) either at a place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting, or, if not so specified, at the place where the meeting is to be held or (ii) during ordinary business hours, at the principal place of business of the Corporation.  The list shall also be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder who is present.

Section 2.11Record Date.

(a)In order that the Corporation may determine the stockholders entitled to notice of or to vote at any meeting of the stockholders or any adjournment thereof, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which record date shall not be more than sixty (60) nor less than ten (10) days before the date of such meeting.  If no record date is fixed by the

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Board of Directors, the record date for determining stockholders entitled to notice of or to vote at a meeting of the stockholders shall be at the close of business on the day next preceding the day on which notice is given, or, if notice is waived, at the close of business on the day next preceding the day on which the meeting is held.  A determination of stockholders of record entitled to notice of or to vote at a meeting of the stockholders shall apply to any adjournment of the meeting; provided, however, that the Board of Directors may fix a new record date for the adjourned meeting.

(b)In order that the Corporation may determine the stockholders entitled to consent to corporate action in writing without a meeting, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted by the Board of Directors, and which record date shall not be more than ten (10) days after the date upon which the resolution fixing the record date is adopted by the Board of Directors.  If no record date has been fixed by the Board of Directors, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting, when no prior action by the Board of Directors is required by applicable law, shall be the first date on which a signed written consent setting forth the action taken or proposed to be taken is delivered to the Corporation by delivery to its registered office in the State of Delaware, its principal place of business, or an officer or agent of the Corporation having custody of the book in which proceedings of meetings of the stockholders are recorded.  Delivery made to the Corporation’s registered office shall be by hand or by certified or registered mail, return receipt requested.  If no record date has been fixed by the Board of Directors and prior action by the Board of Directors is required by applicable law, the record date for determining stockholders entitled to consent to corporate action in writing without a meeting shall be at the close of business on the day on which the Board of Directors adopts the resolution taking such prior action.

Section 2.12Stock Ledger.  The stock ledger of the Corporation shall be the only evidence as to who are the stockholders entitled to examine the stock ledger, the list required by Section 10 of this Article II or the books of the Corporation, or to vote in person or by proxy at any meeting of the stockholders.

Section 2.13Conduct of Meetings.  The Board of Directors of the Corporation may adopt by resolution such rules and regulations for the conduct of any meeting of the stockholders as it shall deem appropriate.  Except to the extent inconsistent with such rules and regulations as adopted by the Board of Directors, the chairman of any meeting of the stockholders shall have the right and authority to prescribe such rules, regulations and procedures and to do all such acts as, in the judgment of such chairman, are appropriate for the proper conduct of the meeting.  Such rules, regulations or procedures, whether adopted by the Board of Directors or prescribed by the chairman of the meeting, may include, without limitation, the following:  (i) the establishment of an agenda or order of business for the meeting; (ii) the determination of when the polls shall open and close for any given matter to be voted on at the meeting;

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(iii) rules and procedures for maintaining order at the meeting and the safety of those present; (iv) limitations on attendance at or participation in the meeting to stockholders of record of the Corporation, their duly authorized and constituted proxies or such other persons as the chairman of the meeting shall determine; (v) restrictions on entry to the meeting after the time fixed for the commencement thereof; and (vi) limitations on the time allotted to questions or comments by participants.

Section 2.14Inspectors of Election.  In advance of any meeting of the stockholders, the Board of Directors, by resolution, the Chairman or the President shall appoint one or more inspectors to act at the meeting and make a written report thereof.  One or more other persons may be designated as alternate inspectors to replace any inspector who fails to act.  If no inspector or alternate is able to act at a meeting of the stockholders, the chairman of the meeting shall appoint one or more inspectors to act at the meeting.  Unless otherwise required by applicable law, inspectors may be officers, employees or agents of the Corporation.  Each inspector, before entering upon the discharge of the duties of inspector, shall take and sign an oath faithfully to execute the duties of inspector with strict impartiality and according to the best of such inspector’s ability.  The inspector shall have the duties prescribed by law and shall take charge of the polls and, when the vote is completed, shall make a certificate of the result of the vote taken and of such other facts as may be required by applicable law.

ARTICLE III
DIRECTORS

Section 3.1Number and Election of Directors.  The Board of Directors shall consist of not less than one nor more than fifteen members, the exact number of which shall initially be fixed by the Incorporator and thereafter from time to time by the Board of Directors.  Except as provided in Section 2 of this Article III, directors shall be elected by a plurality of the votes cast at each Annual Meeting of Stockholders and each director so elected shall hold office until the next Annual Meeting of Stockholders and until such director’s successor is duly elected and qualified, or until such director’s earlier death, resignation or removal.  Directors need not be stockholders.

Section 3.2Vacancies.  Unless otherwise required by law or the Certificate of Incorporation, vacancies on the Board of Directors or any committee thereof arising through death, resignation, removal, an increase in the number of directors constituting the Board of Directors or such committee or otherwise may be filled only by a majority of the directors then in office, though less than a quorum, or by a sole remaining director. The directors so chosen shall, in the case of the Board of Directors, hold office until the next annual election and until their successors are duly elected and qualified, or until their earlier death, resignation or removal and, in the case of any committee of the Board of Directors, shall hold office until their successors are duly appointed by the Board of Directors or until their earlier death, resignation or removal.

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Section 3.3Duties and Powers.  The business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors which may exercise all such powers of the Corporation and do all such lawful acts and things as are not by statute or by the Certificate of Incorporation or by these By-Laws required to be exercised or done by the stockholders.

Section 3.4Meetings.  The Board of Directors and any committee thereof may hold meetings, both regular and special, either within or without the State of Delaware.  Regular meetings of the Board of Directors or any committee thereof may be held without notice at such time and at such place as may from time to time be determined by the Board of Directors or such committee, respectively.  Special meetings of the Board of Directors may be called by the Chairman, if there be one, the President, or by any director.  Special meetings of any committee of the Board of Directors may be called by the chairman of such committee, if there be one, the President, or any director serving on such committee.  Notice thereof stating the place, date and hour of the meeting shall be given to each director (or, in the case of a committee, to each member of such committee) either by mail not less than forty-eight (48) hours before the date of the meeting, by telephone or telegram on twenty-four (24) hours’ notice, or on such shorter notice as the person or persons calling such meeting may deem necessary or appropriate in the circumstances.

Section 3.5Organization.  At each meeting of the Board of Directors or any committee thereof, the Chairman of the Board of Directors or the chairman of such committee, as the case may be, or, in his or her absence or if there be none, a director chosen by a majority of the directors present, shall act as chairman.  Except as provided below, the Secretary of the Corporation shall act as secretary at each meeting of the Board of Directors and of each committee thereof.  In case the Secretary shall be absent from any meeting of the Board of Directors or of any committee thereof, an Assistant Secretary shall perform the duties of secretary at such meeting; and in the absence from any such meeting of the Secretary and all the Assistant Secretaries, the chairman of the meeting may appoint any person to act as secretary of the meeting.  Notwithstanding the foregoing, the members of each committee of the Board of Directors may appoint any person to act as secretary of any meeting of such committee and the Secretary or any Assistant Secretary of the Corporation may, but need not if such committee so elects, serve in such capacity.

Section 3.6Resignations and Removals of Directors.  Any director of the Corporation may resign from the Board of Directors or any committee thereof at any time, by giving notice in writing to the Chairman of the Board of Directors, if there be one, the President or the Secretary of the Corporation and, in the case of a committee, to the chairman of such committee, if there be one.  Such resignation shall take effect at the time therein specified or, if no time is specified, immediately; and, unless otherwise specified in such notice, the acceptance of such resignation shall not be necessary to make it effective.  Except as otherwise required by applicable law and subject to the

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rights, if any, of the holders of shares of preferred stock then outstanding, any director or the entire Board of Directors may be removed from office at any time by the affirmative vote of the holders of at least a majority in voting power of the issued and outstanding capital stock of the Corporation entitled to vote in the election of directors.  Any director serving on a committee of the Board of Directors may be removed from such committee at any time by the Board of Directors.

Section 3.7Quorum.  Except as otherwise required by law, the Certificate of Incorporation or the rules and regulations of any securities exchange or quotation system on which the Corporation’s securities are listed or quoted for trading, at all meetings of the Board of Directors or any committee thereof, a majority of the entire Board of Directors or a majority of the directors constituting such committee, as the case may be, shall constitute a quorum for the transaction of business and the act of a majority of the directors or committee members present at any meeting at which there is a quorum shall be the act of the Board of Directors or such committee, as applicable.  If a quorum shall not be present at any meeting of the Board of Directors or any committee thereof, the directors present thereat may adjourn the meeting from time to time, without notice other than announcement at the meeting of the time and place of the adjourned meeting, until a quorum shall be present.

Section 3.8Actions of the Board by Written Consent.  Unless otherwise provided in the Certificate of Incorporation or these By-Laws, any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting, if all the members of the Board of Directors or such committee, as the case may be, consent thereto in writing, and the writing or writings are filed with the minutes of proceedings of the Board of Directors or such committee.

Section 3.9Meetings by Means of Conference Telephone.  Unless otherwise provided in the Certificate of Incorporation or these By-Laws, members of the Board of Directors of the Corporation, or any committee thereof, may participate in a meeting of the Board of Directors or such committee by means of a conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and participation in a meeting pursuant to this Section 9 shall constitute presence in person at such meeting.

Section 3.10Committees.  The Board of Directors may designate one or more committees, each committee to consist of one or more of the directors of the Corporation.  Each member of a committee must meet the requirements for membership, if any, imposed by applicable law and the rules and regulations of any securities exchange or quotation system on which the securities of the Corporation are listed or quoted for trading.  The Board of Directors may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified

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member at any meeting of any such committee.  Subject to the rules and regulations of any securities exchange or quotation system on which the securities of the Corporation are listed or quoted for trading, in the absence or disqualification of a member of a committee, and in the absence of a designation by the Board of Directors of an alternate member to replace the absent or disqualified member, the member or members thereof present at any meeting and not disqualified from voting, whether or not such member or members constitute a quorum, may unanimously appoint another qualified member of the Board of Directors to act at the meeting in the place of any absent or disqualified member.  Any committee, to the extent permitted by law and provided in the resolution establishing such committee, shall have and may exercise all the powers and authority of the Board of Directors in the management of the business and affairs of the Corporation, and may authorize the seal of the Corporation to be affixed to all papers which may require it.  Each committee shall keep regular minutes and report to the Board of Directors when required.  Notwithstanding anything to the contrary contained in this Article III, the resolution of the Board of Directors establishing any committee of the Board of Directors and/or the charter of any such committee may establish requirements or procedures relating to the governance and/or operation of such committee that are different from, or in addition to, those set forth in these By-Laws and, to the extent that there is any inconsistency between these By-Laws and any such resolution or charter, the terms of such resolution or charter shall be controlling.

Section 3.11Compensation.  The directors may be paid their expenses, if any, of attendance at each meeting of the Board of Directors and may be paid a fixed sum for attendance at each meeting of the Board of Directors or a stated salary for service as director, payable in cash or securities.  No such payment shall preclude any director from serving the Corporation in any other capacity and receiving compensation therefor.  Members of special or standing committees may be allowed like compensation for service as committee members.

Section 3.12Interested Directors.  No contract or transaction between the Corporation and one or more of its directors or officers, or between the Corporation and any other corporation, partnership, association or other organization in which one or more of its directors or officers are directors or officers or have a financial interest, shall be void or voidable solely for this reason, or solely because the director or officer is present at or participates in the meeting of the Board of Directors or committee thereof which authorizes the contract or transaction, or solely because any such director’s or officer’s vote is counted for such purpose if: (i) the material facts as to the director’s or officer’s relationship or interest and as to the contract or transaction are disclosed or are known to the Board of Directors or the committee, and the Board of Directors or committee in good faith authorizes the contract or transaction by the affirmative votes of a majority of the disinterested directors, even though the disinterested directors be less than a quorum; or (ii) the material facts as to the director’s or officer’s relationship or interest and as to the contract or transaction are disclosed or are known to the stockholders entitled to vote thereon, and the contract or transaction is specifically approved in good faith by vote of the stockholders; or (iii) the contract or transaction is

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fair as to the Corporation as of the time it is authorized, approved or ratified by the Board of Directors, a committee thereof or the stockholders.  Common or interested directors may be counted in determining the presence of a quorum at a meeting of the Board of Directors or of a committee which authorizes the contract or transaction.

ARTICLE IV
OFFICERS

Section 4.1General.  The officers of the Corporation shall be chosen by the Board of Directors and shall be a President, a Secretary and a Treasurer.  The Board of Directors, in its discretion, also may choose a Chairman of the Board of Directors (who must be a director) and one or more Vice Presidents, Assistant Secretaries, Assistant Treasurers and other officers.  Any number of offices may be held by the same person, unless otherwise prohibited by law, the Certificate of Incorporation or these By-Laws.  The officers of the Corporation need not be stockholders of the Corporation nor, except in the case of the Chairman of the Board of Directors, need such officers be directors of the Corporation.

Section 4.2Election.  The Board of Directors, at its first meeting held after each Annual Meeting of Stockholders (or action by written consent of stockholders in lieu of the Annual Meeting of Stockholders), shall elect the officers of the Corporation who shall hold their offices for such terms and shall exercise such powers and perform such duties as shall be determined from time to time by the Board of Directors; and each officer of the Corporation shall hold office until such officer’s successor is elected and qualified, or until such officer’s earlier death, resignation or removal.  Any officer elected by the Board of Directors may be removed at any time by the Board of Directors.  Any vacancy occurring in any office of the Corporation shall be filled by the Board of Directors.  The salaries of all officers of the Corporation shall be fixed by the Board of Directors.

Section 4.3Voting Securities Owned by the Corporation.  Powers of attorney, proxies, waivers of notice of meeting, consents and other instruments relating to securities owned by the Corporation may be executed in the name of and on behalf of the Corporation by the President or any Vice President or any other officer authorized to do so by the Board of Directors and any such officer may, in the name of and on behalf of the Corporation, take all such action as any such officer may deem advisable to vote in person or by proxy at any meeting of security holders of any corporation in which the Corporation may own securities and at any such meeting shall possess and may exercise any and all rights and power incident to the ownership of such securities and which, as the owner thereof, the Corporation might have exercised and possessed if present.  The Board of Directors may, by resolution, from time to time confer like powers upon any other person or persons.

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Section 4.4Chairman of the Board of Directors.  The Chairman of the Board of Directors, if there be one, shall preside at all meetings of the stockholders and of the Board of Directors.  The Chairman of the Board of Directors shall be the Chief Executive Officer of the Corporation, unless the Board of Directors designates the President as the Chief Executive Officer, and, except where by law the signature of the President is required, the Chairman of the Board of Directors shall possess the same power as the President to sign all contracts, certificates and other instruments of the Corporation which may be authorized by the Board of Directors.  During the absence or disability of the President, the Chairman of the Board of Directors shall exercise all the powers and discharge all the duties of the President.  The Chairman of the Board of Directors shall also perform such other duties and may exercise such other powers as may from time to time be assigned by these By-Laws or by the Board of Directors.

Section 4.5President.  The President shall, subject to the control of the Board of Directors and, if there be one, the Chairman of the Board of Directors, have general supervision of the business of the Corporation and shall see that all orders and resolutions of the Board of Directors are carried into effect.  The President shall execute all bonds, mortgages, contracts and other instruments of the Corporation requiring a seal, under the seal of the Corporation, except where required or permitted by law to be otherwise signed and executed and except that the other officers of the Corporation may sign and execute documents when so authorized by these By-Laws, the Board of Directors or the President.  In the absence or disability of the Chairman of the Board of Directors, or if there be none, the President shall preside at all meetings of the stockholders and, provided the President is also a director, the Board of Directors.  If there be no Chairman of the Board of Directors, or if the Board of Directors shall otherwise designate, the President shall be the Chief Executive Officer of the Corporation.  The President shall also perform such other duties and may exercise such other powers as may from time to time be assigned to such officer by these By-Laws or by the Board of Directors.

Section 4.6Vice Presidents.  At the request of the President or in the President’s absence or in the event of the President’s inability or refusal to act (and if there be no Chairman of the Board of Directors), the Vice President, or the Vice Presidents if there are more than one (in the order designated by the Board of Directors), shall perform the duties of the President, and when so acting, shall have all the powers of and be subject to all the restrictions upon the President.  Each Vice President shall perform such other duties and have such other powers as the Board of Directors from time to time may prescribe.  If there be no Chairman of the Board of Directors and no Vice President, the Board of Directors shall designate the officer of the Corporation who, in the absence of the President or in the event of the inability or refusal of the President to act, shall perform the duties of the President, and when so acting, shall have all the powers of and be subject to all the restrictions upon the President.

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Section 4.7Secretary.  The Secretary shall attend all meetings of the Board of Directors and all meetings of the stockholders and record all the proceedings thereat in a book or books to be kept for that purpose; the Secretary shall also perform like duties for committees of the Board of Directors when required.  The Secretary shall give, or cause to be given, notice of all meetings of the stockholders and special meetings of the Board of Directors, and shall perform such other duties as may be prescribed by the Board of Directors, the Chairman of the Board of Directors or the President, under whose supervision the Secretary shall be.  If the Secretary shall be unable or shall refuse to cause to be given notice of all meetings of the stockholders and special meetings of the Board of Directors, and if there be no Assistant Secretary, then either the Board of Directors or the President may choose another officer to cause such notice to be given.  The Secretary shall have custody of the seal of the Corporation and the Secretary or any Assistant Secretary, if there be one, shall have authority to affix the same to any instrument requiring it and when so affixed, it may be attested by the signature of the Secretary or by the signature of any such Assistant Secretary.  The Board of Directors may give general authority to any other officer to affix the seal of the Corporation and to attest to the affixing by such officer’s signature.  The Secretary shall see that all books, reports, statements, certificates and other documents and records required by law to be kept or filed are properly kept or filed, as the case may be.

Section 4.8Treasurer.  The Treasurer shall have the custody of the corporate funds and securities and shall keep full and accurate accounts of receipts and disbursements in books belonging to the Corporation and shall deposit all moneys and other valuable effects in the name and to the credit of the Corporation in such depositories as may be designated by the Board of Directors.  The Treasurer shall disburse the funds of the Corporation as may be ordered by the Board of Directors, taking proper vouchers for such disbursements, and shall render to the President and the Board of Directors, at its regular meetings, or when the Board of Directors so requires, an account of all transactions as Treasurer and of the financial condition of the Corporation.  If required by the Board of Directors, the Treasurer shall give the Corporation a bond in such sum and with such surety or sureties as shall be satisfactory to the Board of Directors for the faithful performance of the duties of the office of the Treasurer and for the restoration to the Corporation, in case of the Treasurer’s death, resignation, retirement or removal from office, of all books, papers, vouchers, money and other property of whatever kind in the Treasurer’s possession or under the Treasurer’s control belonging to the Corporation.

Section 4.9Assistant Secretaries.  Assistant Secretaries, if there be any, shall perform such duties and have such powers as from time to time may be assigned to them by the Board of Directors, the President, any Vice President, if there be one, or the Secretary, and in the absence of the Secretary or in the event of the Secretary’s inability or refusal to act, shall perform the duties of the Secretary, and when so acting, shall have all the powers of and be subject to all the restrictions upon the Secretary.

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Section 4.10Assistant Treasurers.  Assistant Treasurers, if there be any, shall perform such duties and have such powers as from time to time may be assigned to them by the Board of Directors, the President, any Vice President, if there be one, or the Treasurer, and in the absence of the Treasurer or in the event of the Treasurer’s inability or refusal to act, shall perform the duties of the Treasurer, and when so acting, shall have all the powers of and be subject to all the restrictions upon the Treasurer.  If required by the Board of Directors, an Assistant Treasurer shall give the Corporation a bond in such sum and with such surety or sureties as shall be satisfactory to the Board of Directors for the faithful performance of the duties of the office of Assistant Treasurer and for the restoration to the Corporation, in case of the Assistant Treasurer’s death, resignation, retirement or removal from office, of all books, papers, vouchers, money and other property of whatever kind in the Assistant Treasurer’s possession or under the Assistant Treasurer’s control belonging to the Corporation.

Section 4.11Other Officers.  Such other officers as the Board of Directors may choose shall perform such duties and have such powers as from time to time may be assigned to them by the Board of Directors.  The Board of Directors may delegate to any other officer of the Corporation the power to choose such other officers and to prescribe their respective duties and powers.

ARTICLE V
STOCK

Section 5.1Form of Certificates.  Every holder of stock in the Corporation shall be entitled to have a certificate signed by, or in the name of the Corporation (i) by the Chairman of the Board of Directors, or the President or a Vice President and (ii) by the Treasurer or an Assistant Treasurer, or the Secretary or an Assistant Secretary of the Corporation, certifying the number of shares owned by such stockholder in the Corporation.

Section 5.2Signatures.  Any or all of the signatures on a certificate may be a facsimile.  In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate shall have ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the Corporation with the same effect as if such person were such officer, transfer agent or registrar at the date of issue.

Section 5.3Lost Certificates.  The Board of Directors may direct a new certificate to be issued in place of any certificate theretofore issued by the Corporation alleged to have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the person claiming the certificate of stock to be lost, stolen or destroyed.  When authorizing such issuance of a new certificate, the Board of Directors may, in its discretion and as a condition precedent to the issuance thereof, require the owner of such lost, stolen or destroyed certificate, or such owner’s legal representative, to advertise the

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same in such manner as the Board of Directors shall require and/or to give the Corporation a bond in such sum as it may direct as indemnity against any claim that may be made against the Corporation on account of the alleged loss, theft or destruction of such certificate or the issuance of such new certificate.

Section 5.4Transfers.  Stock of the Corporation shall be transferable in the manner prescribed by applicable law and in these By-Laws.  Transfers of stock shall be made on the books of the Corporation only by the person named in the certificate or by such person’s attorney lawfully constituted in writing and upon the surrender of the certificate therefor, properly endorsed for transfer and payment of all necessary transfer taxes; provided, however, that such surrender and endorsement or payment of taxes shall not be required in any case in which the officers of the Corporation shall determine to waive such requirement.  Every certificate exchanged, returned or surrendered to the Corporation shall be marked “Cancelled,” with the date of cancellation, by the Secretary or Assistant Secretary of the Corporation or the transfer agent thereof.  No transfer of stock shall be valid as against the Corporation for any purpose until it shall have been entered in the stock records of the Corporation by an entry showing from and to whom transferred.

Section 5.5Dividend Record Date.  In order that the Corporation may determine the stockholders entitled to receive payment of any dividend or other distribution or allotment of any rights or the stockholders entitled to exercise any rights in respect of any change, conversion or exchange of stock, or for the purpose of any other lawful action, the Board of Directors may fix a record date, which record date shall not precede the date upon which the resolution fixing the record date is adopted, and which record date shall be not more than sixty (60) days prior to such action.  If no record date is fixed, the record date for determining stockholders for any such purpose shall be at the close of business on the day on which the Board of Directors adopts the resolution relating thereto.

Section 5.6Record Owners.  The Corporation shall be entitled to recognize the exclusive right of a person registered on its books as the owner of shares to receive dividends, and to vote as such owner, and to hold liable for calls and assessments a person registered on its books as the owner of shares, and shall not be bound to recognize any equitable or other claim to or interest in such share or shares on the part of any other person, whether or not it shall have express or other notice thereof, except as otherwise required by law.

Section 5.7Transfer and Registry Agents.  The Corporation may from time to time maintain one or more transfer offices or agencies and registry offices or agencies at such place or places as may be determined from time to time by the Board of Directors.

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ARTICLE VI
NOTICES

Section 6.1Notices.  Whenever written notice is required by law, the Certificate of Incorporation or these By-Laws, to be given to any director, member of a committee or stockholder, such notice may be given by mail, addressed to such director, member of a committee or stockholder, at such person’s address as it appears on the records of the Corporation, with postage thereon prepaid, and such notice shall be deemed to be given at the time when the same shall be deposited in the United States mail.  Written notice may also be given personally or by telegram, telex or cable.

Section 6.2Waivers of Notice.  Whenever any notice is required by applicable law, the Certificate of Incorporation or these By-Laws, to be given to any director, member of a committee or stockholder, a waiver thereof in writing, signed by the person or persons entitled to notice, whether before or after the time stated therein, shall be deemed equivalent thereto.  Attendance of a person at a meeting, present in person or represented by proxy, shall constitute a waiver of notice of such meeting, except where the person attends the meeting for the express purpose of objecting at the beginning of the meeting to the transaction of any business because the meeting is not lawfully called or convened.  Neither the business to be transacted at, nor the purpose of, any Annual or Special Meeting of Stockholders or any regular or special meeting of the directors or members of a committee of directors need be specified in any written waiver of notice unless so required by law, the Certificate of Incorporation or these By-Laws.

ARTICLE VII
GENERAL PROVISIONS

Section 7.1Dividends.  Dividends upon the capital stock of the Corporation, subject to the requirements of the General Corporation Law of the State of Delaware (the “DGCL”) and the provisions of the Certificate of Incorporation, if any, may be declared by the Board of Directors at any regular or special meeting of the Board of Directors (or any action by written consent in lieu thereof in accordance with Section 8 of Article III hereof), and may be paid in cash, in property, or in shares of the Corporation’s capital stock.  Before payment of any dividend, there may be set aside out of any funds of the Corporation available for dividends such sum or sums as the Board of Directors from time to time, in its absolute discretion, deems proper as a reserve or reserves to meet contingencies, or for purchasing any of the shares of capital stock, warrants, rights, options, bonds, debentures, notes, scrip or other securities or evidences of indebtedness of the Corporation, or for equalizing dividends, or for repairing or maintaining any property of the Corporation, or for any proper purpose, and the Board of Directors may modify or abolish any such reserve.

Section 7.2Disbursements.  All checks or demands for money and notes of the Corporation shall be signed by such officer or officers or such other person or persons as the Board of Directors may from time to time designate.

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Section 7.3Fiscal Year.  The fiscal year of the Corporation shall be fixed by resolution of the Board of Directors.

Section 7.4Corporate Seal.  The corporate seal shall have inscribed thereon the name of the Corporation, the year of its organization and the words “Corporate Seal, Delaware”.  The seal may be used by causing it or a facsimile thereof to be impressed or affixed or reproduced or otherwise.

ARTICLE VIII
INDEMNIFICATION

Section 8.1Power to Indemnify in Actions, Suits or Proceedings other than Those by or in the Right of the Corporation.  Subject to Section 3 of this Article VIII, the Corporation shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (other than an action by or in the right of the Corporation), by reason of the fact that such person is or was a director or officer of the Corporation, or is or was a director or officer of the Corporation serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees), judgments, fines and amounts paid in settlement actually and reasonably incurred by such person in connection with such action, suit or proceeding if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, had no reasonable cause to believe such person’s conduct was unlawful.  The termination of any action, suit or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself, create a presumption that the person did not act in good faith and in a manner which such person reasonably believed to be in or not opposed to the best interests of the Corporation, and, with respect to any criminal action or proceeding, had reasonable cause to believe that such person’s conduct was unlawful.

Section 8.2Power to Indemnify in Actions, Suits or Proceedings by or in the Right of the Corporation.  Subject to Section 3 of this Article VIII, the Corporation shall indemnify any person who was or is a party or is threatened to be made a party to any threatened, pending or completed action or suit by or in the right of the Corporation to procure a judgment in its favor by reason of the fact that such person is or was a director or officer of the Corporation, or is or was a director or officer of the Corporation serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection with the defense or settlement of such action or suit if such person acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the Corporation; except that no indemnification shall be made in respect of any claim, issue or matter as to which such person shall have been adjudged to be liable to the

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Corporation unless and only to the extent that the Court of Chancery of the State of Delaware or the court in which such action or suit was brought shall determine upon application that, despite the adjudication of liability but in view of all the circumstances of the case, such person is fairly and reasonably entitled to indemnity for such expenses which the Court of Chancery or such other court shall deem proper.

Section 8.3Authorization of Indemnification.  Any indemnification under this Article VIII (unless ordered by a court) shall be made by the Corporation only as authorized in the specific case upon a determination that indemnification of the present or former director or officer is proper in the circumstances because such person has met the applicable standard of conduct set forth in Section 1 or Section 2 of this Article VIII, as the case may be.  Such determination shall be made, with respect to a person who is a director or officer at the time of such determination, (i) by a majority vote of the directors who are not parties to such action, suit or proceeding, even though less than a quorum, or (ii) by a committee of such directors designated by a majority vote of such directors, even though less than a quorum, or (iii) if there are no such directors, or if such directors so direct, by independent legal counsel in a written opinion or (iv) by the stockholders.  Such determination shall be made, with respect to former directors and officers, by any person or persons having the authority to act on the matter on behalf of the Corporation.  To the extent, however, that a present or former director or officer of the Corporation has been successful on the merits or otherwise in defense of any action, suit or proceeding described above, or in defense of any claim, issue or matter therein, such person shall be indemnified against expenses (including attorneys’ fees) actually and reasonably incurred by such person in connection therewith, without the necessity of authorization in the specific case.

Section 8.4Good Faith Defined.  For purposes of any determination under Section 3 of this Article VIII, a person shall be deemed to have acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of the Corporation, or, with respect to any criminal action or proceeding, to have had no reasonable cause to believe such person’s conduct was unlawful, if such person’s action is based on the records or books of account of the Corporation or another enterprise, or on information supplied to such person by the officers of the Corporation or another enterprise in the course of their duties, or on the advice of legal counsel for the Corporation or another enterprise or on information or records given or reports made to the Corporation or another enterprise by an independent certified public accountant or by an appraiser or other expert selected with reasonable care by the Corporation or another enterprise.  The provisions of this Section 4 shall not be deemed to be exclusive or to limit in any way the circumstances in which a person may be deemed to have met the applicable standard of conduct set forth in Section 1 or Section 2 of this Article VIII, as the case may be.

Section 8.5Indemnification by a Court.  Notwithstanding any contrary determination in the specific case under Section 3 of this Article VIII, and

17

notwithstanding the absence of any determination thereunder, any director or officer may apply to the Court of Chancery of the State of Delaware or any other court of competent jurisdiction in the State of Delaware for indemnification to the extent otherwise permissible under Section 1 or Section 2 of this Article VIII.  The basis of such indemnification by a court shall be a determination by such court that indemnification of the director or officer is proper in the circumstances because such person has met the applicable standard of conduct set forth in Section 1 or Section 2 of this Article VIII, as the case may be.  Neither a contrary determination in the specific case under Section 3 of this Article VIII nor the absence of any determination thereunder shall be a defense to such application or create a presumption that the director or officer seeking indemnification has not met any applicable standard of conduct.  Notice of any application for indemnification pursuant to this Section 5 shall be given to the Corporation promptly upon the filing of such application.  If successful, in whole or in part, the director or officer seeking indemnification shall also be entitled to be paid the expense of prosecuting such application.

Section 8.6Expenses Payable in Advance.  Expenses (including attorneys’ fees) incurred by a director or officer in defending any civil, criminal, administrative or investigative action, suit or proceeding shall be paid by the Corporation in advance of the final disposition of such action, suit or proceeding upon receipt of an undertaking by or on behalf of such director or officer to repay such amount if it shall ultimately be determined that such person is not entitled to be indemnified by the Corporation as authorized in this Article VIII.  Such expenses (including attorneys’ fees) incurred by former directors and officers or other employees and agents may be so paid upon such terms and conditions, if any, as the Corporation deems appropriate.

Section 8.7Nonexclusivity of Indemnification and Advancement of Expenses.  The indemnification and advancement of expenses provided by, or granted pursuant to, this Article VIII shall not be deemed exclusive of any other rights to which those seeking indemnification or advancement of expenses may be entitled under the Certificate of Incorporation, these By-Laws, agreement, vote of stockholders or disinterested directors or otherwise, both as to action in such person’s official capacity and as to action in another capacity while holding such office, it being the policy of the Corporation that indemnification of the persons specified in Section 1 and Section 2 of this Article VIII shall be made to the fullest extent permitted by law.  The provisions of this Article VIII shall not be deemed to preclude the indemnification of any person who is not specified in Section 1 or Section 2 of this Article VIII but whom the Corporation has the power or obligation to indemnify under the provisions of the DGCL, or otherwise.

Section 8.8Insurance.  The Corporation may purchase and maintain insurance on behalf of any person who is or was a director or officer of the Corporation, or is or was a director or officer of the Corporation serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any liability asserted against such person

18

and incurred by such person in any such capacity, or arising out of such person’s status as such, whether or not the Corporation would have the power or the obligation to indemnify such person against such liability under the provisions of this Article VIII.

Section 8.9Certain Definitions.  For purposes of this Article VIII, references to “the Corporation” shall include, in addition to the resulting corporation, any constituent corporation (including any constituent of a constituent) absorbed in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors or officers, so that any person who is or was a director or officer of such constituent corporation, or is or was a director or officer of such constituent corporation serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, shall stand in the same position under the provisions of this Article VIII with respect to the resulting or surviving corporation as such person would have with respect to such constituent corporation if its separate existence had continued.  The term “another enterprise” as used in this Article VIII shall mean any other corporation or any partnership, joint venture, trust, employee benefit plan or other enterprise of which such person is or was serving at the request of the Corporation as a director, officer, employee or agent.  For purposes of this Article VIII, references to “fines” shall include any excise taxes assessed on a person with respect to an employee benefit plan; and references to “serving at the request of the Corporation” shall include any service as a director, officer, employee or agent of the Corporation which imposes duties on, or involves services by, such director or officer with respect to an employee benefit plan, its participants or beneficiaries; and a person who acted in good faith and in a manner such person reasonably believed to be in the interest of the participants and beneficiaries of an employee benefit plan shall be deemed to have acted in a manner “not opposed to the best interests of the Corporation” as referred to in this Article VIII.

Section 8.10Survival of Indemnification and Advancement of Expenses.  The indemnification and advancement of expenses provided by, or granted pursuant to, this Article VIII shall, unless otherwise provided when authorized or ratified, continue as to a person who has ceased to be a director or officer and shall inure to the benefit of the heirs, executors and administrators of such a person.

Section 8.11Limitation on Indemnification.  Notwithstanding anything contained in this Article VIII to the contrary, except for proceedings to enforce rights to indemnification (which shall be governed by Section 5 of this Article VIII), the Corporation shall not be obligated to indemnify any director or officer (or his or her heirs, executors or personal or legal representatives) or advance expenses in connection with a proceeding (or part thereof) initiated by such person unless such proceeding (or part thereof) was authorized or consented to by the Board of Directors of the Corporation.

19

Section 8.12Indemnification of Employees and Agents.  The Corporation may, to the extent authorized from time to time by the Board of Directors, provide rights to indemnification and to the advancement of expenses to employees and agents of the Corporation similar to those conferred in this Article VIII to directors and officers of the Corporation.

ARTICLE IX
AMENDMENTS

Section 9.1Amendments.  These By-Laws may be altered, amended or repealed, in whole or in part, or new By-Laws may be adopted by the stockholders or by the Board of Directors; provided, however, that notice of such alteration, amendment, repeal or adoption of new By-Laws be contained in the notice of such meeting of the stockholders or Board of Directors, as the case may be.  All such amendments must be approved by either the holders of a majority of the outstanding capital stock entitled to vote thereon or by a majority of the entire Board of Directors then in office.

20

Section 9.2Entire Board of Directors.  As used in this Article IX and in these By-Laws generally, the term “entire Board of Directors” means the total number of directors which the Corporation would have if there were no vacancies.

* * *

Adopted as of: January 18, 2011

Last Amended as of:                       

21

EX-3.7

Exhibit 3.7

RESTATED CERTIFICATE OF INCORPORATION
OF
COMMUNICATIONS & POWER INDUSTRIES ASIA INC.
a Delaware corporation

Communications & Power Industries Asia Inc., a corporation organized and existing under the laws of the State of Delaware, hereby certifies as follows:

1.The present name of this corporation is Communications & Power Industries Asia Inc. (the “Corporation”).  The Corporation was originally incorporated under the same name and its original Certificate of Incorporation was filed with the Delaware Secretary of State on June 27, 1995.

2.The Restated Certificate of Incorporation has been duly adopted in accordance with the provisions of Sections 245 and 242 of the Delaware General Corporation Law by the sole director of the Corporation and the sole stockholder of the Corporation.

3.The Restated Certificate of Incorporation of the Corporation attached hereto as Exhibit A restates and amends the provisions of the Corporation’s Certificate of Incorporation as currently in effect.

4.The Corporation’s Certificate of Incorporation is hereby restated in its entirety to read as set forth on Exhibit A attached hereto and incorporated herein by this reference.

IN WITNESS WHEREOF, the Corporation has caused this Restated Certificate of Incorporation to be duly executed by the undersigned officer of the Corporation this 15th day of September, 2004.

Communications & Power Industries Asia Inc.
By:	/s/John Beighley
	John Beighley, President

Exhibit A

RESTATED CERTIFICATE OF INCORPORATION
OF
COMMUNICATIONS & POWER INDUSTRIES ASIA INC.

ONE:The name of the corporation is Communications & Power Industries Asia Inc. (hereinafter referred to as the “Corporation”).

TWO:The address of the Corporation’s registered office in the State of Delaware is 615 South DuPont Highway, in the City of Dover, County of Kent.  The name of the Corporation’s registered agent at such address is National Corporate Research, Ltd.

THREE:The purpose of the Corporation is to be a trading company and to engage in any lawful act or activity for which a corporation may be organized under the Delaware General Corporation Law.

FOUR:The Corporation is authorized to issue one class of stock which will be designated “Common Stock.”  The total number of shares of Common Stock which the Corporation shall have authority to issue is one thousand (1,000), and the par value of each of such shares is one cent ($.01).

FIVE:The following provisions are inserted for the management of the business and the conduct of the affairs of the Corporation, and for further definition, limitation and regulation of the powers of the Corporation and of its directors and stockholders:

A.The business and affairs of the Corporation shall be managed by or under the direction of the Board of Directors.  In addition to the powers and authority expressly conferred upon them by statute or by this Certificate of Incorporation or the Bylaws of the Corporation, the directors are hereby empowered to exercise all such powers and do all such acts and things as may be exercised or done by the Corporation.

B.The Board of Directors may adopt, amend or repeal the Bylaws of the Corporation.

C.The directors of the Corporation need not be elected by written ballot unless the Bylaws so provide.

SIX:The Corporation reserves the right to amend and repeal any provision contained in this Certificate of Incorporation in the manner from time to time prescribed by the laws of the State of Delaware.  All rights herein conferred are granted subject to this reservation.

SEVEN:A director of the Corporation shall not be personally liable to the Corporation or its stockholders for monetary damages for any breach of fiduciary duty as a director, except for liability (i) for any breach of the director’s duty of loyalty to the Corporation or its stockholders, (ii) for acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) under Section 174 of the Delaware General

1

Corporation Law or (iv) for any transaction from which such director derived any improper personal benefit.  This Article SEVEN is also contained in Article VIII, Section 1, of the Corporation’s Bylaws.  No amendment to or repeal of this Article SEVEN shall apply to or have any effect on the liability or alleged liability of any director of the Corporation for or with respect to any acts or omissions of such director occurring prior to such amendment or repeal.  If the Delaware General Corporation Law is amended to authorize corporate action further eliminating the personal liability of directors, then the liability of a director of the Corporation shall be eliminated or limited to the fullest extent permitted by the Delaware General Corporation Law, as amended, Any repeal or modification of this provision shall not adversely affect any right or protection of a director of the Corporation existing at the time of such repeal or modification.

EIGHT:A.Right to Indemnification.  Each person who was or is made a party or is threatened to be made a party to or is otherwise involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (hereinafter a “proceeding”), by reason of the fact that he or she is or was a director or an officer of the Corporation or is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust or other enterprise, including service with respect to an employee benefit plan (hereinafter an “indemnitee”), whether the basis of such proceeding is alleged action in an official capacity as a director, officer, employee or agent or in any other capacity while serving as a director, officer, employee or agent, shall be indemnified and held harmless by the Corporation to the fullest extent authorized by the Delaware General Corporation Law, as the same exists or may hereafter be amended (but, in the case of any such amendment, only to the extent that such amendment permits the Corporation to provide broader indemnification rights than such law permitted the Corporation to provide prior to such amendment), against all expense, liability and loss (including attorneys’ fees, judgments, fines, ERISA excise taxes or penalties and amounts paid in settlement) reasonably incurred or suffered by such indemnitee in connection therewith; provided, however, that, except as provided in Section C of this Article EIGHT with respect to proceedings to enforce rights to indemnification, the Corporation shall indemnify any such indemnitee in connection with a proceeding (or part thereof) initiated by such indemnitee only if such proceeding (or part thereof) was authorized by the Board of Directors of the Corporation.

B.Right to Advancement of Expenses.  The right to indemnification conferred in Section A of this Article EIGHT shall include the right to be paid by the Corporation the expenses (including attorneys’ fees) incurred in defending any such proceeding in advance of its final disposition (hereinafter an “advancement of expenses”); provided, however, that, if the Delaware General Corporation Law requires, an advancement of expenses incurred by an indemnitee in his or her capacity as a director or officer (and not in any other capacity in which service was or is rendered by such indemnitee, including, without limitation, service to an employee benefit plan) shall be made only upon delivery to the Corporation of an undertaking (hereinafter an “undertaking”), by or on behalf of such indemnitee, to repay all amounts so advanced if it shall ultimately be determined by final judicial decision from which there is no further right to appeal (hereinafter a “final adjudication”) that such indemnitee is not entitled to be indemnified for such expenses under this Section B or otherwise.  The rights to indemnification and to the advancement of expenses conferred in Sections A and B of this Article EIGHT shall be contract rights and such rights shall continue as to an indemnitee who

2

has ceased to be a director, officer, employee or agent and shall inure to the benefit of the indemnitee’s heirs, executors and administrators.

C.Right of Indemnitee to Bring Suit.  If a claim under Section A or B of this Article EIGHT is not paid in full by the Corporation within sixty (60) days after a written claim has been received by the Corporation, except in the case of a claim for an advancement of expenses, in which case the applicable period shall be twenty (20) days, the indemnitee may at any time thereafter bring suit against the Corporation to recover the unpaid amount of the claim.  If successful in whole or in part in any such suit, or in a suit brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the indemnitee shall be entitled to be paid also the expense of prosecuting or defending such suit.  In (i) any suit brought by the indemnitee to enforce a right to indemnification hereunder (but not in a suit brought by the indemnitee to enforce a right to an advancement of expenses) it shall be a defense that, and (ii) in any suit brought by the Corporation to recover an advancement of expenses pursuant to the terms of an undertaking, the Corporation shall be entitled to recover such expenses upon a final adjudication that, the indemnitee has not met any applicable standard for indemnification set forth in the Delaware General Corporation Law.  Neither the failure of the Corporation (including its Board of Directors, independent legal counsel, or its stockholders) to have made a determination prior to the commencement of such suit that indemnification of the indemnitee is proper in the circumstances because the indemnitee has met the applicable standard of conduct set forth in the Delaware General Corporation Law, nor an actual determination by the Corporation (including its Board of Directors, independent legal counsel, or its stockholders) that the indemnitee has not met such applicable standard of conduct, shall create a presumption that the indemnitee has not met the applicable standard of conduct or, in the case of such a suit brought by the indemnitee, be a defense to such suit.  In any suit brought by the indemnitee to enforce a right to indemnification or to an advancement of expenses hereunder, or brought by the Corporation to recover an advancement or expenses pursuant to the terms of an undertaking, the burden of proving that the indemnitee is not entitled to be indemnified, or to such advancement of expenses, under this Article EIGHT or otherwise shall be on the Corporation.

D.Non-Exclusivity of Rights.  The rights to indemnification and to the advancement of expenses conferred in this Article EIGHT shall not be exclusive of any other right which any person may have or hereafter acquire under any statute, the Corporation’s Certificate of Incorporation, Bylaws, agreement, vote of stockholders or disinterested directors or otherwise.

E.Insurance.  The Corporation may maintain insurance, at its expense, to protect itself and any director, officer, employee or agent of the Corporation or another corporation, partnership, joint venture, trust or other enterprise against any expense, liability or loss, whether or not the Corporation would have the power to indemnify such person against such expense, liability or loss under the Delaware General Corporation Law.

F.Indemnification of Employees and Agents of the Corporation.  The Corporation may, to the extent authorized from time to time by the Board of Directors, grant rights to indemnification and to the advancement of expenses to any employee or agent of the

3

Corporation to the fullest extent of the provisions of this Article with respect to the indemnification and advancement of expenses of directors and officers of the Corporation.

G.Amendment.  This Article EIGHT is also contained in Article VIII, Sections 2 through 7, of the Corporation’s Bylaws.  Any repeal or modification of this Article EIGHT shall not change the rights of any officer or director to indemnification with respect to any action or omission occurring prior to such repeal or modification.

4

EX-3.9

Exhibit 3.9

RESTATED ARTICLES OF INCORPORATION
OF
ECONCO BROADCAST SERVICE, INC.,
a California corporation

David Elliott and Joel A. Littman certify pursuant to Section 910 of the California General Corporation Law that:

1.They are the President and the Secretary, respectively, of Econco Broadcast Service, Inc., a California corporation.

2.The Restated Articles of Incorporation of this corporation are amended and restated to read in their entirety as set forth on the Restated Articles of Incorporation attached hereto as Exhibit A.

3.The foregoing amendment and restatement of Restated Articles of Incorporation has been duly approved by the Board of Directors.

4.The foregoing amendment and restatement of Articles of Incorporation has been duly approved by the required vote of shareholders in accordance with Section 902 of the California General Corporation Law.  The total number of outstanding shares of the corporation is 375.  The number of shares voting in favor of the amendment equaled or exceeded the vote required.  The percentage vote required was more than 50%.

The undersigned further declare under penalty of perjury under the laws of the State of California that the matters set forth in this certificate are true and correct of their own knowledge.

Executed at Woodland, California, this 8th day of October, 2004.

/s/ David Elliott

David Elliott, President

Executed at Palo Alto, California, this 8th day of October, 2004.

/s/ Joel A. Littmana

Joel A. Littman, Secretary

Exhibit A

RESTATED ARTICLES OF INCORPORATION
OF
ECONCO BROADCAST SERVICE, INC.,
a California corporation

ONE:The name of this corporation is Econco Broadcast Service, Inc.

TWO:The purpose of this corporation is to engage in any lawful act or activity for which a corporation may be organized under the California General Corporation Law other than the banking business, the trust company business or the practice of a profession permitted to be incorporated by the California Corporations Code.

THREE:This corporation is authorized to issue one class of shares of stock; the total number of said shares is twenty thousand (20,000).

FOUR:The liability of the directors of this corporation for monetary damages shall be eliminated to the fullest extent permissible under California law.

FIVE:This corporation is authorized to indemnify the directors and officers of this corporation to the fullest extent permissible under California law.

CERTIFICATE OF AMENDMENT OF
RESTATED ARTICLES OF INCORPORATION
OF
ECONCO BROADCAST SERVICE, INC.
a California corporation

David Elliott and Joel A. Littman certify that:

1.They are the President and the Secretary, respectively, of Econco Broadcast Service, Inc., a California corporation.

2.Article ONE of the Restated Articles of Incorporation of this corporation is amended to read in its entirety as follows:

“ONE: The name of this corporation is CPI Econco Division.”

3.The foregoing amendment to the Restated Articles of Incorporation has been duly approved by the Board of Directors.

4.The foregoing amendment to the Restated Articles of Incorporation has been duly approved by the required vote of shareholders in accordance with Section 902 of the California General Corporation Law.  The total number of outstanding shares of the corporation is 375.  The number of shares voting in favor of the amendment equaled or exceeded the vote required.  The percentage vote required was more than 50%.

Each of the undersigned further declare under penalty of perjury under the laws of the State of California that the matters set forth in this certificate are true and correct of his own knowledge.

Executed at Palo Alto, California, this 1st day of May, 2008.

/s/ David Elliott

David Elliott, President

/s/ Joel A. Littman

Joel A. Littman, Secretary

EX-3.10

Exhibit 3.10

RESTATED BYLAWS

for the regulation, except as
otherwise provided by statute or
the Restated Articles of Incorporation, of

Econco Broadcast Service, Inc.,
a California corporation

TABLE OF CONTENTS

			Page
	Section 1.1	Principal Executive Office	1
	Section 1.2	Section 1.2 Number of Directors	1
ARTICLE II.		SHARES AND SHAREHOLDERS	1
	Section 2.1	Meetings of Shareholders	1
	(a)	Place of Meetings	1
	(b)	Annual Meetings	1
	(c)	Special Meetings	2
	(d)	Notice of Meetings	2
	(e)	Adjourned Meeting and Notice Thereof	2
	(f)	Waiver of Notice	3
	(g)	Quorum	3
	Section 2.2	Action Without a Meeting	3
	Section 2.3	Voting of Shares	4
	(a)	In General	4
	(b)	Cumulative Voting	4
	(c)	Election by Ballot	4
	Section 2.4	Proxies	4
	Section 2.5	Inspectors of Election	4
	(a)	Appointment	4
	(b)	Duties	5
	Section 2.6	Record Date	5
	Section 2.7	Share Certificates	6
	(a)	In General	6

i

	(b)	Two or More Classes or Series	6
	(c)	Special Restrictions	6
	Section 2.8	Transfer of Certificates	7
	Section 2.9	Lost Certificates	7
ARTICLE III.		DIRECTORS	7
	Section 3.1	Powers	7
	Section 3.2	Committees of the Board	8
	Section 3.3	Election and Term of Office	8
	Section 3.4	Vacancies	8
	Section 3.5	Removal	9
	Section 3.6	Resignation	9
	Section 3.7	Meetings of the Board of Directors and Committees	9
	(a)	Regular Meetings	9
	(b)	Organization Meeting	9
	(c)	Special Meetings	9
	(d)	Notices; Waivers	9
	(e)	Adjournment	10
	(f)	Place of Meeting	10
	(g)	Presence by Conference Telephone Call	10
	(h)	Ouorum	10
	Section 3.8	Action Without Meeting	10
	Section 3.9	Committee Meetings	10
ARTICLE IV.		OFFICERS	10

ii

	Section 4.1	Officers		10
	Section 4.2	Elections		11
	Section 4.3	Other Officers		11
	Section 4.4	Removal		11
	Section 4.5	Resignation		11
	Section 4.6	Vacancies		11
	Section 4.7	Chairman of the Board		11
	Section 4.8	President		11
	Section 4.9	Vice President		12
	Section 4.10	Secretary		12
	Section 4.11	Chief Financial Officer		12
	Section 4.12	Treasurer		12
ARTICLE V.		MISCELLANEOUS		13
	Section 5.1	Records and Reports		13
	(a)	Books of Account and Proceedings		13
	(b)	Annual Report		13
	(c)	Shareholders’ Requests for Financial Reports		13
	Section 5.2	Rights of Inspection		13
	(a)	By Shareholders		13
		(1)	Record of Shareholders	13
		(2)	Corporate Records	14

iii

		(3)	Bylaws	14
	(b)	By Directors		14
	Section 5.3	Checks, Drafts, Etc.		14
	Section 5.4	Representation of Shares of Other Corporations		14
	Section 5.5	Indemnification and Insurance		15
	(a)	Right to Indemnification		15
	(b)	Right of Claimant to Bring Suit		15
	(c)	Non-Exclusivity of Rights		16
	(d)	Insurance		16
	(e)	Indemnification of Employees and Agents of the Corporation		16
	Section 5.6	Employee Stock Purchase Plans		16
	Section 5.7	Time Notice Given or Sent		17
	Section 5.8	Construction and Definitions		17
ARTICLE VI.		AMENDMENTS		17
	Section 6.1	Power of Shareholders		17
	Section 6.2	Power of Directors		17

iv

RESTATED BYLAWS

for the regulation, except as otherwise provided
by statute or the Restated Articles of Incorporation,
of

ECONCO BROADCAST SERVICE, INC.

GENERAL PROVISIONS

Section 1.1  Principal Executive Office.  The Board of Directors shall designate the location of the principal executive office of the corporation at any place within or without the State of California.  The Board of Directors shall have the power to change the principal executive office to another location and may designate and locate one or more subsidiary offices within or without the State of California.

Section 1.2  Section 1.2 Number of Directors.  The number of directors of the corporation shall be two (2) until changed by a bylaw amending this Section 1.02 duly adopted by the vote or written consent of a majority of the outstanding shares entitled to vote; provided, however, that if at any time the number of directors is more than one (1), a bylaw reducing the number of directors to a number less than five (5) cannot be adopted if the votes cast against its adoption at a meeting or the shares not consenting in the case of action by written consent are equal to more than 16-2/3 percent of the outstanding shares entitled to vote.

ARTICLE II.  SHARES AND SHAREHOLDERS

Section 2.1  Meetings of Shareholders.

(a)Place of Meetings.  Meetings of shareholders shall be held at any place within or without the State of California designated by the Board of Directors.  In the absence of any such designation, shareholders’ meetings shall be held at the principal executive office of the corporation.

(b)Annual Meetings.  An annual meeting of the shareholders of the corporation shall be held on such date and at such time as may be designated by the Board of Directors.  Should said day fall upon a legal holiday, the annual meeting of shareholders shall be held at the same time on the next day thereafter ensuing which is a full business day.  At each annual meeting directors shall be elected, and any other proper business may be transacted.

(c)Special Meetings.  Special meetings of the shareholders may be called by the Board of Directors, the chairman of the board, the president, or by the holders of shares entitled

to cast not less than 10 percent of the votes at the meeting.  Upon request in writing to the chairman of the board, the president, any vice president or the secretary by any person (other than the board) entitled to call a special meeting of shareholders, the officer forthwith shall cause notice to be given to the shareholders entitled to vote that a meeting will be held at a time requested by the person or persons calling the meeting, not less than 35 nor more than 60 daysafter the receipt of the request.  If the notice is not given within 20 days after receipt of the request, the persons entitled to call the meeting may give the notice.

(d)Notice of Meetings.  Notice of any shareholders’ meeting shall be given not less than 10 nor more than 60 days before the date of the meeting to each shareholder entitled to vote thereat.  Such notice shall state the place, date and hour of the meeting and (i) in the case of a special meeting, the general nature of the business to be transacted, and no other business may be transacted, or (ii) in the case of the annual meeting, those matters which the Board, at the time of the giving of the notice, intends to present for action by the shareholders.  The notice of any meeting at which directors are to be elected shall include the names of nominees intended at the time of the notice to be presented by the board for election.

If action is proposed to be taken at any meeting, which action is within Sections 310, 902, 1201, 1900 or 2007 of the General Corporation Law of the State of California, the notice shall also state the general nature of that proposal.

Notice of a shareholders’ meeting shall be given either personally or by first-class mail, or other means of written communication, charges prepaid, addressed to the shareholder at the address of such shareholder appearing on the books of the corporation or given by the shareholder to the corporation for the purpose of notice; or if no such address appears or is given, at the place where the principal executive office of the corporation is located or by publication at least once in a newspaper of general circulation in the county in which the principal executive office is located.  The notice shall be deemed to have been given at the time when delivered personally or deposited in the mail or sent by other means of written communication.  An affidavit of mailing of any notice executed by the secretary, assistant secretary or any transfer agent, shall be prima facie evidence of the giving of the notice.

(e)Adjourned Meeting and Notice Thereof.  Any meeting of shareholders may be adjourned from time to time by the vote of a majority of the shares represented either in person or by proxy whether or not a quorum is present.  When a shareholders’ meeting is adjourned to another time or place, notice need not be given of the adjourned meeting if the time and place thereof are announced at the meeting at which the adjournment is taken.  At the adjourned meeting the corporation may transact any business which might have been transacted at the original meeting.  However, if the adjournment is for more than 45 days or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each shareholder of record entitled to vote at the meeting.

(f)Waiver of Notice.  The transactions of any meeting of shareholders, however called and noticed, and wherever held, are as valid as though had at a meeting duly held after regular call and notice, if a quorum is present either in person or by proxy, and if, either before or after the meeting, each of the persons entitled to vote, not present in person or by proxy, signs a

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written waiver of notice or a consent to the holding of the meeting or an approval of the minutes thereof The waiver of notice or consent need not specify either the business to be transacted or the purpose of any annual or special meeting of shareholders, except that if action is taken or proposed to be taken for approval of any of those matters specified in the second paragraph of subparagraph (d) of Section 2.01 of this Article II, the waiver of notice or consent shall state thegeneral nature of the proposal.  All such waivers, consents and approvals shall be filed with the corporate records or made a part of the minutes of the meeting.

(g)Quorum.  The presence in person or by proxy of the persons entitled to vote a majority of the shares entitled to vote at any meeting shall constitute a quorum for the transaction of business.  If a quorum is present, the affirmative vote of the majority of the shares represented and voting at the meeting (which shares voting affirmatively also constitute at least a majority of the required quorum) shall be the act of the shareholders, unless the vote of a greater number or voting by classes is required by law or the Restated Articles of Incorporation of the corporation.

The shareholders present at a duly called or held meeting at which a quorum is present may continue to transact business until adjournment notwithstanding the withdrawal of enough shareholders to leave less than a quorum, provided that any action taken (other than adjournment) must be approved by at least a majority of the shares required to constitute a quorum.

Section 2.2  Action Without a Meeting.  Any action which may be taken at any annual or special meeting of shareholders may be taken without a meeting and without prior notice, if a consent in writing, setting forth the action so taken, shall be signed by the holders of outstanding shares having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted.  Notwithstanding the foregoing, directors may not be elected by written consent except by unanimous written consent of all shares entitled to vote for the election of directors, except as provided by Section 3.04 hereof.

(a)Where the approval of shareholders is given without a meeting by less than unanimous written consent, unless the consents of all shareholders entitled to vote have been solicited in writing, the secretary shall give prompt notice of the corporate action approved by the shareholders without a meeting.  In the case of approval of transactions pursuant to Section 310, 317, 1201 or 2007 of the General Corporation Law of the State of California, the notice shall be given at least 10 days before the consummation of any action authorized by that approval.  Such notice shall be given in the same manner as notice of shareholders’ meeting.

Section 2.3  Voting of Shares.

(a)In General.  Except as otherwise provided in the Restated Articles of Incorporation and subject to subparagraph (b) hereof, each outstanding share, regardless of class, shall be entitled to one (I) vote on each matter submitted to a vote of shareholders.

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(b)Cumulative Voting.  At any election of directors, every shareholder complying with this paragraph (b) and entitled to vote may cumulate his or her votes and give one (1) candidate a number of votes equal to the number of directors to be elected multiplied by the number of votes to which the shareholder’s shares are entitled, or distribute the shareholder’s votes on the same principle among as many candidates as the shareholder thinks fit.  No shareholder shall be entitled to cumulate votes (i.e., cast for any one (1) or more candidates a number of votes greater than the number of votes which such shareholder normally is entitled to cast) unless such candidate or candidates’ names have been placed in nomination prior to the voting and the shareholder has given notice at the meeting prior to the voting of the shareholder’sintention to cumulate the shareholder’s votes.  If any one (I) shareholder has given such notice, all shareholders may cumulate their votes for candidates in nomination.  In any election of directors, the candidates receiving the highest number of affirmative votes up to the number of directors to be elected by such shares are elected; votes against a director and votes withheld shall have no legal effect.

(c)Election by Ballot.  Elections for directors need not be by ballot unless a shareholder demands election by ballot at the meeting and before the voting begins.

Section 2.4  Proxies.  Every person entitled to vote shares may authorize another person or persons to act by proxy with respect to such shares.  No proxy shall be valid after the expiration of 11 months from the date thereof unless otherwise provided in the proxy.  Every proxy continues in full force and effect until revoked by the person executing it prior to the vote pursuant thereto, except as otherwise herein provided.  Such revocation may be effected by a writing delivered to the corporation stating that the proxy is revoked or by a subsequent proxy executed by the person executing the prior proxy and presented to the meeting, or as to any meeting by attendance at such meeting and voting in person by the person executing the proxy.  The dates contained on the forms of proxy presumptively determine the order of execution, regardless of the postmark dates on the envelopes in which they are mailed.  A proxy is not revoked by the death or incapacity of the maker unless, before the vote is counted, written notice of such death or incapacity is received by the corporation.  The revocability of a proxy that states on its face that it is irrevocable shall be governed by the provisions of Sections 705(e) and 705(0 of the California General Corporation Law.

Section 2.5  Inspectors of Election.

(a)Appointment.  In advance of any meeting of shareholders the Board may appoint inspectors of election to act at the meeting and any adjournment thereof.  If inspectors of election are not so appointed, or if any persons so appointed fail to appear or refuse to act, the chairman of any meeting of shareholders may, and on the request of any shareholder or a shareholder’s proxy shall, appoint inspectors of election (or persons to replace those who so fail or refuse) at the meeting.  The number of inspectors shall be either one (1) or three (3).  If appointed at a meeting on the request of one (1) or more shareholders or proxies, the majority of shares represented in person or by proxy shall determine whether one (1) or three (3) inspectors are to be appointed.

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(b)Duties.  The inspectors of election shall determine the number of shares outstanding and the voting power of each, the shares represented at the meeting, the existence of a quorum and the authenticity, validity and effect of proxies, receive votes, ballots or consents, hear and determine all challenges and questions in any way arising in connection with the right to vote, count and tabulate all votes or consents, determine when the polls shall close, determine the result and do such acts as may be proper to conduct the election or vote with fairness to all shareholders.  The inspectors of election shall perform their duties impartially, in good faith, to the best of their ability and as expeditiously as is practical.  If there are three inspectors of election, the decision, act or certificate of a majority is effective in all respects as the decision, act or certificate of all.  Any report or certificate made by the inspectors of election is prima facie evidence of the facts stated therein.

Section 2.6  Record Date.  In order that the corporation may determine the shareholders entitled to notice of any meeting or to vote or entitled to receive payment of any dividend or other distribution or allotment of any rights or entitled to exercise any rights in respect of any other lawful action, the Board may fix, in advance, a record date, which shall not be more than 60 nor less than 10 days prior to the date of such meeting nor more than 60 days prior to any other action.  If no record date is fixed:

(1)The record date for determining shareholders entitled to notice of or to vote at a meeting of shareholders shall be at the close of business on the business day next preceding the day on which notice is given or, if notice is waived, at the close of business on the business day next preceding the day on which the meeting is held.

(2)The record date for determining shareholders entitled to give consent to corporate action in writing without a meeting, when no prior action by the Board has been taken, shall be the day on which the first written consent is given.

(3)The record date for determining shareholders for any other purpose shall be at the close of business on the day on which the board adopts the resolution relating thereto, or the 60th day prior to the date of such other action, whichever is later.

A determination of shareholders of record entitled to notice of or to vote at a meeting of shareholders shall apply to any adjournment of the meeting unless the board fixes a new record date for the adjourned meeting, but the board shall fix a new record date if the meeting is adjourned for more than 45 days from the date set for the original meeting.

Shareholders at the close of business on the record date are entitled to notice and to vote or to receive the dividend, distribution or allotment of rights or to exercise the rights, as the case may be, notwithstanding any transfer of any shares on the books of the corporation after the record date, except as otherwise provided in the Restated Articles of Incorporation or by agreement or in the California General Corporation Law.

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Section 2.7  Share Certificates.

(a)In General.  The corporation shall issue a certificate or certificates representing shares of its capital stock.  Each certificate so issued shall be signed in the name of the corporation by the chairman or vice chairman of the board or the president or a vice president and by the chief financial officer or an assistant treasurer or the secretary or any assistant secretary, shall state the name of the record owner thereof and shall certify the number of shares and the class or series of shares represented thereby.  Any or all of the signatures on the certificate may be facsimile.  In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate has ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the corporation with the same effect as if such person were an officer, transfer agent or registrar at the date of issue.

(b)Two or More Classes or Series.  If the shares of the corporation are classified or if any class of shares has two or more series, there shall appear on the certificate one (1) of the following:

(1)A statement of the rights, preferences, privileges, and restrictions granted to or imposed upon the respective classes or series of shares authorized to be issued and upon the holders thereof; or

(2)A summary of such rights, preferences, privileges and restrictions with reference to the provisions of the Restated Articles of Incorporation and any certificates of determination establishing the same; or

(3)A statement setting forth the office or agency of the corporation from which shareholders may obtain upon request and without charge, a copy of the statement referred to in subparagraph (1).

(c)Special Restrictions.  There shall also appear on the certificate (unless stated or summarized under subparagraph (1) or (2) of subparagraph (b) above) the statements required by all of the following clauses to the extent applicable:

(1)The fact that the shares are subject to restrictions upon transfer.

(2)If the shares are assessable, a statement that they are assessable.

(3)If the shares are not fully paid, a statement of the total consideration to be paid therefor and the amount paid thereon.

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(4)The fact that the shares are subject to a voting agreement or an irrevocable proxy or restrictions upon voting rights contractually imposed by the corporation.

(5)The fact that the shares are redeemable.

(6)The fact that the shares are convertible and the period for conversion.

Section 2.8  Transfer of Certificates.  Where a certificate for shares is presented to the corporation or its transfer clerk or transfer agent with a request to register a transfer of shares, the corporation shall register the transfer, cancel the certificate presented, and issue a new certificate if (a) the security is endorsed by the appropriate person or persons; (b) reasonable assurance is given that those endorsements are genuine and effective; (c) the corporation has no notice of adverse claims or has discharged any duty to inquire into such adverse claims; (d) any applicable law relating to the collection of taxes has been complied with; (e) the transfer is not in violation of any federal or state securities law; and (0 the transfer is in compliance with any applicable agreement governing the transfer of the shares.

Section 2.9  Lost Certificates.  Where a certificate has been lost, destroyed or wrongfully taken, the corporation shall issue a new certificate in place of the original if the owner:

(a)so requests before the corporation has notice that the certificate has been acquired by a bona fide purchaser; (h) files with the corporation a sufficient indemnity bond, if so requested by the Board of Directors; and (c) satisfies any other reasonable requirements as may be imposed by the Board.  Except as above provided, no new certificate for shares shall be issuedin lieu of an old certificate unless the corporation is ordered to do so by a court in the judgment in an action brought under Section 419(b) of the California General Corporation Law.

ARTICLE III.  DIRECTORS

Section 3.1  Powers.  Subject to the provisions of the California General Corporation Law and the Restated Articles of Incorporation, the business and affairs of the corporation shall be managed and all corporate powers shall be exercised by or under the direction of the Board of Directors.  The Board may delegate the management of the day-to-day operations of the business of the corporation to a management company or other person provided that the business and affairs of the corporation shall be managed and all corporate powers shall be exercised under the ultimate direction of the Board.

Section 3.2  Committees of the Board.  The Board may, by resolution adopted by a majority of the authorized number of directors, designate one (1) or more committees, each consisting of two or more directors, to serve at the pleasure of the Board.  The Board may designate one (1) or more directors as alternate members of any committee, who may replace any absent member at

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any meeting of the committee.  The appointment of members or alternate members of a committee requires the vote of a majority of the authorized number of directors.  Any such committee, to the extent provided in the resolution of the Board, shall have all the authority of the Board, except with respect to:

(1)The approval of any action which also requires, under the California General Corporation Law, shareholders’ approval or approval of the outstanding shares;

(2)The filling of vacancies on the Board or in any committee.

(3)The fixing of compensation of the directors for serving on the Board or on any committee.

(4)The amendment or repeal of bylaws or the adoption of new bylaws.

(5)The amendment or repeal of any resolution of the Board which by its express terms is not so amendable or repealable.

(6)A distribution (within the meaning of the California General Corporation Law) to the shareholders of the corporation, except at a rate or in a periodic amount or within a price range determined by the Board.

(7)The appointment of other committees of the Board or the members thereof.

Section 3.3  Election and Term of Office.  The directors shall be elected at each annual meeting of shareholders but, if any such annual meeting is not held or the directors are not elected thereat, the directors may be elected at any special meeting of shareholders held for that purpose.  Each director, including a director elected to fill a vacancy, shall hold office until the expiration of the term for which elected and until a successor has been elected and qualified.

Section 3.4  Vacancies.  Except for a vacancy created by the removal of a director, vacancies on the Board may be filled by approval of the Board or, if the number of directors then in office is less than a quorum, by (a) the unanimous written consent of the directors then in office, (b) the affirmative vote of a majority of the directors then in office at a meeting held pursuant to notice or waivers of notice under the California General Corporation Law, or (c) a sole remaining director.  The shareholders may elect a director or directors at any time to fill any vacancy or vacancies not filled by the directors, but any such election by written consent requires the consent of a majority of the outstanding shares entitled to vote.

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The Board of Directors shall have the power to declare vacant the office of a director who has been declared of unsound mind by an order of court, or convicted of a felony.

Section 3.5  Removal.  Any or all of the directors may be removed without cause if such removal is approved by the vote of a majority of the outstanding shares entitled to vote, except that no director may be removed (unless the entire board is removed) when the votes cast against removal, or not consenting in writing to such removal, would be sufficient to elect such director if voted cumulatively at an election at which the same total number of votes were cast (or, if such action is taken by written consent, all shares entitled to vote were voted) and the entire number of directors authorized at the time of the director’s most recent election were then being elected.

Section 3.6  Resignation.  Any director may resign effective upon giving written notice to the chairman of the board, the president, the secretary or the Board of Directors of the corporation, unless the notice specifies a later time for the effectiveness of such resignation.  If the resignation is effective at a future time, a successor may be elected to take office when the resignation becomes effective.

Section 3.7  Meetings of the Board of Directors and Committees.

(a)Regular Meetings.  Regular meetings of the Board of Directors may be held without notice at such time and place within or without the State as may be designated from time to time by resolution of the Board or by written consent of all members of the Board or in these bylaws.

(b)Organization Meeting.  Immediately following each annual meeting of shareholders the Board of Directors shall hold a regular meeting for the purpose of organization, election of officers, and the transaction of other business.  Notice of such meetings is hereby dispensed with.

(c)Special Meetings.  Special meetings of the Board of Directors for any purpose or purposes may be called at any time by the chairman of the board or the president or, by any vice president or the secretary or any two directors.

(d)Notices; Waivers.  Special meetings shall be held upon four (4) days’ notice by mail or forty-eight (48) hours’ notice delivered personally or by telephone, including a voice messaging system or other system or technology designed to record and communicate messages, telegraph, facsimile, electronic mail, or other electronic means.  Notice of a meeting need not be given to any director who signs a waiver of notice or a consent to holding the meeting or an approval of the minutes thereof, whether before or after the meeting, or who attends the meetingwithout protesting, prior thereto or at its commencement, the lack of notice to such director.  All such waivers, consents and approvals shall be filed with the corporate records or made a part of the minutes of the meeting.

(e)Adjournment.  A majority of the directors present, whether or not a quorum is present, may adjourn any meeting to another time and place.  If the meeting is adjourned for

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more than 24 hours, notice of such adjournment to another time and place shall be given prior to the time of the adjourned meeting to the directors who were not present at the time of adjournment.

(f)Place of Meeting.  Meetings of the Board may be held at any place within or without the state which has been designated in the notice of the meeting or, if not stated in the notice or there is no notice, then such meeting shall be held at the principal executive office of the corporation, or such other place designated by resolution of the Board.

(g)Presence by Conference Telephone Call.  Members of the Board may participate in a meeting through use of conference telephone or similar communications equipment, so long as all members participating in such meeting can hear one another.  Such participation constitutes presence in person at such meeting.

(h)Quorum.  A majority of the authorized number of directors constitutes a quorum of the Board for the transaction of business.  Every act or decision done or made by a majority of the directors present at a meeting duly held at which a quorum is present is the act of the Board of Directors, unless a greater number be required by law or by the Restated Articles of Incorporation.  A meeting at which a quorum is initially present may continue to transact business notwithstanding the withdrawal of directors, if any action taken is approved by at least a majority of the required quorum for such meeting.

Section 3.8  Action Without Meeting.  Any action required or permitted to be taken by the Board of Directors, may be taken without a meeting if all members of the Board shall individually or collectively consent in writing to such action.  Such written consent or consents shall be filed with the minutes of the proceedings of the Board.  Such action by written consent shall have the same force and effect as a unanimous vote of such directors.

Section 3.9  Committee Meetings.  The provisions of Sections 3.07 and 3.08 of these bylaws apply also to committees of the Board and action by such committees, mutatis mutandis.

ARTICLE IV.  OFFICERS

Section 4.1  Officers.  The officers of the corporation shall consist of a chairman of the board or a president, or both, a secretary, a chief financial officer, and such additional officers as may be elected or appointed in accordance with Section 4.03 of these bylaws and as may be necessary to enable the corporation to sign instruments and share certificates.  Any number of offices may be held by the same person.

Section 4.2  Elections.  All officers of the corporation, except such officers as may be otherwise appointed in accordance with Section 4.03, shall be chosen by the Board of Directors, and shallserve at the pleasure of the Board of Directors, subject to the rights, if any, of an officer under any contract of employment.

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Section 4.3  Other Officers.  The Board of Directors, the chairman of the board, or the president at their or his discretion, may appoint one (I) or more vice presidents, one (1) or more assistant secretaries, a treasurer, one (1) or more assistant treasurers, or such other officers as the business of the corporation may require, each of whom shall hold office for such period, have such authority and perform such duties as the Board of Directors, the chairman of the board, or the president, as the case may be, may from time to time determine.

Section 4.4  Removal.  Subject to the rights, if any, of an officer under any contract of employment, any officer may be removed, either with or without cause, by the Board of Directors, or, except in case of an officer chosen by the Board of Directors, by any officer upon whom such power of removal may be conferred by the Board of Directors, without prejudice to the rights, if any, of the corporation under any contract to which the officer is a party.

Section 4.5  Resignation.  Any officer may resign at any time by giving written notice to the Board of Directors or to the president, or to the secretary of the corporation without prejudice to the rights, if any, of the corporation under any contract to which the officer is a party.  Any such resignation shall take effect at the date of the receipt of such notice or at any later time specified therein; and, unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective.

Section 4.6  Vacancies.  A vacancy in any office because of death, resignation, removal, disqualification or any other cause shall be filled in the manner prescribed in these bylaws for regular appointments to such office.

Section 4.7  Chairman of the Board.  The chairman of the board, if there shall be such an officer, shall, if present, preside at all meetings of the Board of Directors and exercise and perform such other powers and duties as may be from time to time assigned to him by the Board of Directors.  If there is no president, the chairman of the board shall in addition be the chief executive officer of the corporation and shall have the powers and duties prescribed in Section 4.08 below.

Section 4.8  President.  Subject to such supervisory powers, if any, as may be given by the Board of Directors to the chairman of the board, if there be such an officer, the president shall be general manager and chief executive officer of the corporation and shall, subject to the control of the Board of Directors, have general supervision, direction and control of the business and affairs of the corporation.  He shall preside at all meetings of the shareholders and, in the absence of the chairman of the board, or if there be none, at all meetings of the Board of Directors.  He shall be ex-officio a member of all the standing committees.  including the executive committee, if any, and shall have the general powers and duties of management usually vested in the office of president of a corporation, and shall have such other powers and duties as may be prescribed by the Board of Directors or these bylaws.

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Section 4.9  Vice President.  In the absence of the president or in the event of the president’s inability or refusal to act, the vice president, or in the event there be more than one (1) vice president, the vice president designated by the Board of Directors, or if no such designation ismade, in order of their election, shall perform the duties of president and when so acting, shall have all the powers of and be subject to all the restrictions upon the president.  Any vice president shall perform such other duties as from time to time may be assigned to such vice president by the president or the Board of Directors.

Section 4.10  Secretary.  The secretary shall keep or cause to be kept the minutes of proceedings and record of shareholders, as provided for and in accordance with Section 5.01(a) of these bylaws.

The secretary shall give, or cause to be given, notice of all meetings of the shareholders and of the Board of Directors required by these bylaws or by law to be given, and shall have such other powers and perform such other duties as may be prescribed by the Board of Directors.

Section 4.11  Chief Financial Officer.  The chief financial officer shall have general supervision, direction and control of the financial affairs of the corporation and shall have such other powers and duties as may be prescribed by the Board of Directors or these bylaws.  In the absence of a named treasurer, the chief financial officer shall also have the powers and duties of the treasurer as hereinafter set forth and shall be authorized and empowered to sign as treasurer in any case where such officer’s signature is required.

Section 4.12  Treasurer.  The treasurer shall keep or cause to be kept the books and records of account as provided for and in accordance with Section 5.01(a) of these bylaws.  The books of account shall at all reasonable times be open to inspection by any director.

The treasurer shall deposit all moneys and other valuables in the name and to the credit of the corporation with such depositaries as may be designated by the Board of Directors.  He shall disburse the funds of the corporation as may be ordered by the Board of Directors, shall render to the president and directors, whenever they request it, an account of all of his transactions as treasurer and of the financial condition of the corporation, and shall have such other powers and perform such other duties as may be prescribed by the Board of Directors or these bylaws.  In the absence of a named chief financial officer, the treasurer shall be deemed to be the chief financial officer and shall have the powers and duties of such office as hereinabove set forth.

ARTICLE V.  MISCELLANEOUS

Section 5.1  Records and Reports.

(a)Books of Account and Proceedings.  The corporation shall keep adequate and correct books and records of account and shall keep minutes of the proceedings of its

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shareholders, Board and committees of the board and shall keep at its principal executive office, or at the office of its transfer agent or registrar, a record of its shareholders, giving the names and addresses of all shareholders and the number and class of shares held by each.  Such minutes shall be kept in written form.  Such other books and records shall be kept either in written form or in any other form capable of being converted into written form.

(b)Annual Report.  An annual report to shareholders referred to in Section 1501 of the California General Corporation Law is expressly dispensed with, but nothing herein shall beinterpreted as prohibiting the Board of Directors from issuing annual or other periodic reports to the shareholders of the corporation as they consider appropriate.

(c)Shareholders’ Requests for Financial Reports.  If no annual report for the last fiscal year has been sent to shareholders, the corporation shall, upon the written request of any shareholder made more than 120 days after the close of that fiscal year, deliver or mail to the person making the request within 30 days thereafter the financial statements for that year required by Section 1501(a) of the California General Corporation Law.  Any shareholder or shareholders holding at least five (5) percent of the outstanding shares of any class of the corporation may make a written request to the corporation for an income statement of the corporation for the three-month, six-month or nine-month period of the current fiscal year ended more than 30 days prior to the date of the request and a balance sheet of the corporation as of the end of such period, and the corporation shall deliver or mail the statements to the person making the request within 30 days thereafter.  A copy of the statements shall be kept on file in the principal office of the corporation for 12 months and they shall be exhibited at all reasonable times to any shareholder demanding an examination of them or a copy shall be mailed to such shareholder upon demand.

Section 5.2  Rights of Inspection.

(a)By Shareholders.

(1)Record of Shareholders.  Any shareholder or shareholders holding at least five (5) percent in the aggregate of the outstanding voting shares of the corporation or who hold at least one (1) percent of such voting shares and have filed a Schedule 14A with the United States Securities and Exchange Commission shall have an absolute right to do either or both of the following: (0 inspect and copy the record of shareholders’ names and addresses and shareholdings during usual business hours upon five (5) business days’ prior written demand upon the corporation, or (ii) obtain from the transfer agent for the corporation, upon written demand and upon the tender of its usual charges for such a list (the amount of which charges shall be stated to the shareholder by the transfer agent upon request), a list of the shareholders’ names and addresses, who are entitled to vote for the election of directors, and their shareholdings, as of the most recent record date for which it has been compiled or as of a date specified by the shareholder subsequent to the date of demand.  The list shall be made available on or before the later of five (5) business days after demand is received or the date specified therein as the date as of which the list is to be compiled.

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The record of shareholders shall also be open to inspection and copying by any shareholder or holder of a voting trust certificate at any time during usual business hours upon written demand on the corporation, for a purpose reasonably related to such holder’s interests as a shareholder or holder of a voting trust certificate.

(2)Corporate Records.  The accounting books and records and minutes of proceedings of the shareholders and the Board and committees of the board shall be open to inspection upon the written demand on the corporation of any shareholder or holder of a voting trust certificate at any reasonable time during usual business hours, for a purpose reasonably related to such holder’s interests as a shareholder or as the holder of such voting trust certificate.  This right of inspection shall also extend to the records of any subsidiary of the corporation.

(3)Bylaws.  The corporation shall keep at its principal executive office in this state, the original or a copy of its bylaws as amended to date, which shall be open to inspection by the shareholders at all reasonable times during office hours.

(b)By Directors.  Every director shall have the absolute right at any reasonable time to inspect and copy all books, records and documents of every kind and to inspect the physical properties of the corporation of which such person is a director and also of its subsidiary corporations, domestic or foreign.  Such inspection by a director may be made in person or by agent or attorney and the right of inspection includes the right to copy and make extracts.

Section 5.3  Checks, Drafts, Etc.  All checks, drafts or other orders for payment of money, notes or other evidences of indebtedness, issued in the name of or payable to the corporation, shall be signed or endorsed by such person or persons and in such manner as, from time to time, shall be determined by resolution of the Board of Directors.

Section 5.4  Representation of Shares of Other Corporations.  The chairman of the board, if any, president or any vice president of the corporation, or any other person authorized to do so by the chairman of the board, president or any vice president, is authorized to vote, represent and exercise on behalf of the corporation all rights incident to any and all shares of any other corporation or corporations standing in the name of the corporation.  The authority herein granted to said officers to vote or represent on behalf of the corporation any and all shares held by the corporation in any other corporation or corporations may be exercised either by such officers in person or by any other person authorized so to do by proxy or power of attorney duly executed by said officers.

Section 5.5  Indemnification and Insurance.

(a)Right to Indemnification.  Each person who was or is made a party to or is threatened to be made a party to or is involuntarily involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (hereinafter a “Proceeding”), by reason of the fact that he or she, or a person of whom he or she is the legal representative, is or was a director or officer of the corporation or is or was serving (during such person’s tenure as director or officer) at the request of the corporation, any other corporation, partnership, joint venture,

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trust or other enterprise in any capacity, whether the basis of a Proceeding is an alleged action in an official capacity as a director or officer or in any other capacity while serving as a director or officer, shall be indemnified and held harmless by the corporation to the fullest extent authorized by California General Corporation Law, as the same exists or may hereafter be amended (but, in the case of any such amendment, only to the extent that such amendment permits the corporation to provide broader indemnification rights than said law permitted the corporation to provide prior to such amendment), against all expenses, liability and loss (including attorneys’ fees, judgments, fines, or penalties and amounts to be paid in settlement) reasonably incurred or suffered by such person in connection therewith.  The right to indemnification conferred in this Section shall be a contract right and shall include the right to be paid by the corporation the expenses incurred in defending a Proceeding in advance of its final disposition; provided, however, that, if CaliforniaGeneral Corporation Law requires, the payment of such expenses in advance of the final disposition of a Proceeding shall be made only upon receipt by the corporation of an undertaking by or on behalf of such director or officer to repay all amounts so advanced if it shall ultimately be determined that such director or officer is not entitled to be indemnified under this Section or otherwise.  No amendment to or repeal of this Section 5.05 shall apply to or have any effect on any right to indemnification provided hereunder with respect to any acts or omissions occurring prior to such amendment or repeal.

(b)Right of Claimant to Bring Suit.  If a claim for indemnity under paragraph (a) of this Section is not paid in full by the corporation within 90 days after a written claim has been received by the corporation, the claimant may at any time thereafter bring suit against the corporation to recover the unpaid amount of the claim and, if successful in whole or in part, the claimant shall also be entitled to be paid the expense of prosecuting such claim including reasonable attorneys’ fees incurred in connection therewith.  It shall be a defense to any such action (other than an action brought to enforce a claim for expenses incurred in defending a Proceeding in advance of its final disposition where the required undertaking, if any is required, has been tendered to the corporation) that the claimant has not met the standards of conduct which make it permissible under California General Corporation Law for the corporation to indemnify the claimant for the amount claimed, but the burden of proving such defense shall be on the corporation_ Neither the failure of the corporation (including its Board of Directors, independent legal counsel, or its shareholders) to have made a determination prior to the commencement of such action that indemnification of the claimant is proper in the circumstances because he or she has met the applicable standard of conduct set forth in California General Corporation Law, nor an actual determination by the corporation (including its Board of Directors, independent legal counsel, or its shareholders) that the claimant has not met such applicable standard of conduct, shall be a defense to the action or create a presumption that the claimant has not met the applicable standard of conduct.

(c)Non-Exclusivity of Rights.  The rights conferred in this Section shall not be exclusive of any other rights which any director, officer, employee or agent may have or hereafter acquire under any statute, provision of the Restated Articles of Incorporation, bylaw, agreement, vote of shareholders or disinterested directors or otherwise, to the extent the additional rights to indemnification are authorized in the Restated Articles of Incorporation of the corporation.

(d)Insurance.  In furtherance and not in limitation of the powers conferred by statute:

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(1)the corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any expense, liability or loss, whether or not the corporation would have the power to indemnify the person against that expense, liability or loss under the California General Corporation Law.

(2)the corporation may create a trust fund, grant a security interest and/or use other means (including, without limitation, letters of credit, surety bonds and/or other similar arrangements), as well as enter into contracts providing indemnification to the full extentauthorized or permitted by law and including as part thereof provisions with respect to any or all of the foregoing to ensure the payment of such amounts as may become necessary to effect indemnification as provided therein, or elsewhere.

(e)Indemnification of Employees and Agents of the Corporation.  The corporation may, to the extent authorized from time to time by the Board of Directors, grant rights to indemnification, including the right to be paid by the corporation the expenses incurred in defending a Proceeding in advance of its final disposition, to any employee or agent of the corporation to the fullest extent of the provisions of this Section or otherwise with respect to the indemnification and advancement of expenses of directors and officers of the corporation.

Section 5.6  Employee Stock Purchase Plans.  The corporation may adopt and carry out a stock purchase plan or agreement or stock option plan or agreement providing for the issue and sale for such consideration as may be fixed of its unissued shares, or of issued shares acquired or to be acquired, to one (1) or more of the employees or directors of the corporation or of a subsidiary or to a trustee on their behalf and for the payment for such shares in installments or at one (1) time, and may provide for aiding any such persons in paying for such shares by compensation for services rendered, promissory notes or otherwise.

A stock purchase plan or agreement or stock option plan or agreement may include, among other features, the fixing of eligibility for participation therein, the class and price of shares to be issued or sold under the plan or agreement, the number of shares which may be subscribed for, the method of payment therefor, the reservation of title until full payment therefor, the effect of the termination of employment, an option or obligation on the part of the corporation to repurchase the shares upon termination of employment, subject to the provisions of the California General Corporation Law, restrictions upon transfer of the shares and the time limits of and termination of the plan.

Section 5.7  Time Notice Given or Sent.  Any reference in these Bylaws to the time a notice is given or sent means, unless otherwise expressly provided herein or by law, (a) the time a written notice by mail is deposited in the United States mails, postage prepaid; or (b) the time any other written notice, including facsimile, telegram, or electronic mail message, is personally delivered to the recipient or is delivered to a common carrier for transmission, or actually transmitted by the person giving the notice by electronic means, to the recipient; or (c) the time any oral notice is communicated, in person or by telephone, including a voice messaging system or other system

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or technology designed to record and communicate messages, or wireless, to the recipient, including the recipient’s designated voice mailbox or address on such system, or to a person at the office of the recipient who the person giving the notice has reason to believe will promptly communicate it to the recipient.

Section 5.8  Construction and Definitions.  Unless the context otherwise requires, the general provisions, rules of construction and definitions contained in the California General Corporation Law shall govern the construction of these bylaws.  Without limiting the generality of the foregoing, the masculine gender includes the feminine and neuter, the singular number includes the plural and the plural number includes the singular, and the term “person” includes a corporation as well as a natural person.

ARTICLE VI.  AMENDMENTS

Section 6.1  Power of Shareholders.  New bylaws may be adopted or these bylaws may be amended or repealed by the vote of shareholders entitled to exercise a majority of the voting power of the corporation or by the written assent of such shareholders, except as otherwise provided by law or by the Restated Articles of Incorporation.

Section 6.2  Power of Directors.  Subject to the right of shareholders as provided in Section 6.01 to adopt, amend or repeal bylaws, any bylaw may be adopted, amended or repealed by the Board of Directors other than a bylaw or amendment thereof changing the authorized number of directors, if such number is fixed, or the maximum-minimum limits thereof, if an indefinite number.

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THIS IS TO CERTIFY:

That I am the duly elected, qualified and acting Secretary of Econco Broadcast Service, Inc., a California corporation, and that the foregoing bylaws were adopted as the bylaws of said corporation as of the 8th day of October, 2004, by the Board of Directors and the sole shareholder of said corporation.

Dated as of October 8, 2004
	/s/ Joel A. Littman
	Joel A. Littman, Secretary

EX-3.11

Exhibit 3.11

RESTATED ARTICLES OF INCORPORATION
OF
MALIBU RESEARCH ASSOCIATES, INC.,
a California corporation

Robert A. Fickett and Joel A. Littman certify pursuant to Section 910 of the California General Corporation Law that:

1.They are the President and the Secretary, respectively, of Malibu Research Associates, Inc., a California corporation.

2.The Restated Articles of Incorporation of this corporation are amended and restated to read in their entirety as set forth on the Restated Articles of Incorporation attached hereto as Exhibit A and incorporated herein by this reference.

3.The foregoing amendment and restatement of Restated Articles of Incorporation has been duly approved by the Board of Directors.

4.The foregoing amendment and restatement of Articles of Incorporation has been duly approved by the required vote of shareholders in accordance with Section 902 of the California General Corporation Law. The total number of outstanding shares of the corporation is 45,699. The number of shares voting in favor of the amendment equaled or exceeded the vote required, The percentage vote required was more than 50%.

The undersigned further declare under penalty of perjury under the laws of the State of California that the matters set forth in this certificate are true and correct of their own knowledge.

Executed at Palo Alto, California, this 10th day of August, 2007.

/s/ Robert A. Fickett

Robert A. Fickett, President

Executed at Palo Alto, California, this 10th day of August, 2007.

/s/ Joel A. Littman

Joel A. Littman, Secretary

Exhibit A

RESTATED ARTICLES OF INCORPORATION
OF
MALIBU RESEARCH ASSOCIATES, INC.,
a California corporation

ONE:The name of this corporation is Malibu Research Associates, Inc.

TWO:The purpose of this corporation is to engage in any lawful act or activity for which a corporation may be organized under the California General Corporation Law other than the banking business, the trust company business or the practice of a profession permitted to be incorporated by the California Corporations Code.

THREE:This corporation is authorized to issue one class of shares of stock; the total number of said shares is Fifty Thousand (50,000).

FOUR:The liability of the directors of this corporation for monetary damages shall be eliminated to the fullest extent permissible under California law.

FIVE:This corporation is authorized to indemnify the directors and officers of this corporation to the fullest extent permissible under California law.

SIX:This corporation hereby elects to be governed by all of the provisions of the General Corporation Law effective January 1, 1977, not otherwise applicable to it under Chapter 23 thereof.

CERTIFICATE OF AMENDMENT OF
RESTATED ARTICLES OF INCORPORATION
OF
MALIBU RESEARCH ASSOCIATES INC.
a California corporation

Robert A. Fickett and Joel A. Littman certify that:

1.They are the President and the Secretary, respectively, of Malibu Research Associates, Inc., a California corporation.

2.Article ONE of the Restated Articles of Incorporation of this corporation is amended to read in its entirety as follows:

“ONE: The name of this corporation is CPI Malibu Division.”

3.The foregoing amendment to the Restated Articles of Incorporation has been duly approved by the Board of Directors.

4.The foregoing amendment to the Restated Articles of Incorporation has been duly approved by the required vote of shareholders in accordance with Section 902 of the California General Corporation Law. The total number of outstanding shares of the corporation is 45,699. The number of shares voting in favor of the amendment equaled or exceeded the vote required. The percentage vote required was more than 50%.

Each of the undersigned further declares under penalty of perjury under the laws of the State of California that the matters set forth in this certificate are true and correct of his own knowledge.

Executed at Palo Alto, California, this 1st day of May, 2008.

/s/ Robert A. Fickett

Robert A. Fickett, President

/s/ Joel A. Littman

Joel A. Littman, Secretary

EX-3.12

Exhibit 3.12

RESTATED BYLAWS

for the regulation, except as
otherwise provided by statute or
the Restated Articles of Incorporation, of

Malibu Research Associates, Inc.,
a California corporation

TABLE OF CONTENTS

				Page
ARTICLE I GENERAL PROVISIONS				1
	Section 1.1		Principal Executive Office	1
	Section 1.2		Number of Directors	1
ARTICLE II SHARES AND SHAREHOLDERS				1
	Section 2.1		Meetings of Shareholders	1
		(a)	Place of Meetings	1
		(b)	Annual Meetings	1
		(c)	Special Meetings	2
		(d)	Notice of Meetings	2
		(e)	Adjourned Meeting and Notice Thereof	2
		(f)	Waiver of Notice	3
		(g)	Quorum	3
	Section 2.2		Action Without a Meeting	3
	Section 2.3		Voting of Shares	4
		(a)	In General	4
		(b)	Cumulative Voting	4
		(c)	Election by Ballot	4
	Section 2.4		Proxies	4
	Section 2.5		Inspectors of Election	4
		(a)	Appointment	4
		(b)	Duties	5
	Section 2.6		Record Date	5
	Section 2.7		Share Certificates	6

		(a)	In General	6
		(b)	Two or More Classes or Series	6
		(c)	Special Restrictions	6
	Section 2.8		Transfer of Certificates	7
	Section 2.9		Lost Certificates	7
ARTICLE III DIRECTORS				7
	Section 3.1		Powers	7
	Section 3.2		Committees of the Board	8
	Section 3.3		Election and Term of Office	8
	Section 3.4		Vacancies	8
	Section 3.5		Removal	9
	Section 3.6		Resignation	9
	Section 3.7		Meetings of the Board of Directors and Committees	9
		(a)	Regular Meetings	9
		(b)	Organization Meeting	9
		(c)	Special Meetings	9
		(d)	Notices; Waivers	9
		(e)	Adjournment	10
		(f)	Place of Meeting	10
		(g)	Presence by Conference Telephone Call	10
		(h)	Quorum	10
	Section 3.8		Action Without Meeting	10
	Section 3.9		Committee Meetings	10
ARTICLE IV OFFICERS				10

	Section 4.1		Officers	10
	Section 4.2		Elections	11
	Section 4.3		Other Officers	11
	Section 4.4		Removal	11
	Section 4.5		Resignation	11
	Section 4.6		Vacancies	11
	Section 4.7		Chairman of the Board	11
	Section 4.8		President	11
	Section 4.9		Vice President	12
	Section 4.10		Secretary	12
	Section 4.11		Chief Financial Officer	12
	Section 4.12		Treasurer	12
ARTICLE V MISCELLANEOUS				13
	Section 5.1		Records and Reports	13
		(a)	Books of Account and Proceedings	13
		(b)	Annual Report	13
		(c)	Shareholders’ Requests for Financial Reports	13
	Section 5.2		Rights of Inspection	13
		(a)	By Shareholders	13
		(b)	By Directors	14

	Section 5.3		Checks, Drafts, Etc	14
	Section 5.4		Representation of Shares of Other Corporations	14
	Section 5.5		Indemnification and Insurance	15
		(a)	Right to Indemnification	15
		(b)	Right of Claimant to Bring Suit	15
		(c)	Non-Exclusivity of Rights	16
		(d)	Insurance	16
		(e)	Indemnification of Employees and Agents of the Corporation	16
	Section 5.6		Employee Stock Purchase Plans	16
	Section 5.7		Time Notice Given or Sent	17
	Section 5.8		Construction and Definitions	17
ARTICLE VI AMENDMENTS				17
	Section 6.1		Power of Shareholders	17
	Section 6.2		Power of Directors	17

RESTATED BYLAWS

for the regulation, except as otherwise provided
by statute or the Restated Articles of Incorporation,
of

MALIBU RESEARCH ASSOCIATES, INC.

ARTICLE I

GENERAL PROVISIONS

Section 1.1             Principal Executive Office. The Board of Directors shall designate the location of the principal executive office of the corporation at any place within or without the State of California. The Board of Directors shall have the power to change the principal executive office to another location and may designate and locate one or more subsidiary offices within or without the State of California.

Section 1.2             Number of Directors. The number of directors of the corporation shall be two (2) until changed by a bylaw amending this Section 1.2 duly adopted by the vote or written consent of a majority of the outstanding shares entitled to vote; provided, however, that if at any time the number of directors is more than one (1), a bylaw reducing the number of directors to a number less than five (5) cannot be adopted if the votes cast against its adoption at a meeting or the shares not consenting in the case of action by written consent are equal to more than 16-2/3 percent of the outstanding shares entitled to vote.

ARTICLE II

SHARES AND SHAREHOLDERS

Section 2.1             Meetings of Shareholders.

(a)        Place of Meetings. Meetings of shareholders shall be held at any place within or without the State of California designated by die Board of Directors. In the absence of any such designation, shareholders’ meetings shall be held at the principal executive office of the corporation.

(b)        Annual Meetings. An annual meeting of the shareholders of the corporation shall be held on such date and at such time as may be designated by the Board of Directors. Should said day fall upon a legal holiday, the annual meeting of shareholders shall be held at the same time on the next day thereafter ensuing which is a full business day. At each annual meeting directors shall be elected, and any other proper business may be transacted.

(c)        Special Meetings. Special meetings of the shareholders may be called by the Board of Directors, the chairman of the board, the president, or by the holders of shares entitled to cast not less than 10 percent of the votes at the meeting. Upon request in writing to the chairman of the board, the president, any vice president or the secretary by any person (other than the board) entitled to call a special meeting of shareholders, the officer forthwith shall cause notice to be given to the shareholders entitled to vote that a meeting will be held at a time requested by the person or persons calling the meeting, not less than 35 nor more than 60 days after the receipt of the request. If the notice is not given within 20 days after receipt of the request, the persons entitled to call the meeting may give the notice.

(d)        Notice of Meetings. Notice of any shareholders’ meeting shall be given not less than 10 nor more than 60 days before the date of the meeting to each shareholder entitled to vote thereat. Such notice shall state the place, date and hour of the meeting and (i) in the case of a special meeting, the general nature of the business to be transacted, and no other business may be transacted, or (ii) in the case of the annual meeting, those matters which the Board, at the time of the giving of the notice, intends to present for action by the shareholders. The notice of any meeting at which directors are to be elected shall include the names of nominees intended at the time of the notice to be presented by the board for election.

If action is proposed to be taken at any meeting, which action is within Sections 310, 902, 1201, 1900 or 2007 of the General Corporation Law of the State of California, the notice shall also state the general nature of that proposal.

Notice of a shareholders’ meeting shall be given either personally or by first-class mail, or other means of written communication, charges prepaid, addressed to the shareholder at the address of such shareholder appearing on the books of the corporation or given by the shareholder to the corporation for the purpose of notice; or if no such address appears or is given, at the place where the principal executive office of the corporation is located or by publication at least once in a newspaper of general circulation in the county in which the principal executive office is located. The notice shall be deemed to have been given at the time when delivered personally or deposited in the mail or sent by other means of written communication. An affidavit of mailing of any notice executed by the secretary, assistant secretary or any transfer agent, shall be prima facie evidence of the giving of the notice.

(e)        Adjourned Meeting and Notice Thereof. Any meeting of shareholders may be adjourned from time to time by the vote of a majority of the shares represented either in person or by proxy whether or not a quorum is present. When a shareholders’ meeting is adjourned to another time or place, notice need not be given of the adjourned meeting if the time and place thereof are announced at the meeting at which the adjournment is taken. At the adjourned meeting the corporation may transact any business which might have been transacted at the original meeting. However, if the adjournment is for more than 45 days or if after the adjournment a new record date is fixed for the adjourned meeting, a notice of the adjourned meeting shall be given to each shareholder of record entitled to vote at the meeting.

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(f)         Waiver of Notice. The transactions of any meeting of shareholders, however called and noticed, and wherever held, are as valid as though had at a meeting duly held after regular call and notice, if a quorum is present either in person or by proxy, and if, either before or after the meeting, each of the persons entitled to vote, not present in person or by proxy, signs a written waiver of notice or a consent to the holding of the meeting or an approval of the minutes thereof. The waiver of notice or consent need not specify either the business to be transacted or the purpose of any annual or special meeting of shareholders, except that if action is taken or proposed to be taken for approval of any of those matters specified in the second paragraph of subparagraph (d) of Section 2.1 of this Article II, the waiver of notice or consent shall state the general nature of the proposal. All such waivers, consents and approvals shall be filed with the corporate records or made a part of the minutes of the meeting.

(g)        Quorum. The presence in person or by proxy of the persons entitled to vote a majority of the shares entitled to vote at any meeting shall constitute a quorum for the transaction of business. If a quorum is present, the affirmative vote of the majority of the shares represented and voting at the meeting (which shares voting affirmatively also constitute at least a majority of the required quorum) shall be the act of the shareholders, unless the vote of a greater number or voting by classes is required by law or the Restated Articles of Incorporation of the corporation.

The shareholders present at a duly called or held meeting at which a quorum is present may continue to transact business until adjournment notwithstanding the withdrawal of enough shareholders to leave less than a quorum, provided that any action taken (other than adjournment) must be approved by at least a majority of the shares required to constitute a quorum.

Section 2.2             Action Without a Meeting. Any action which may be taken at any annual or special meeting of shareholders may be taken without a meeting and without prior notice, if a consent in writing, setting forth the action so taken, shall be signed by the holders of outstanding shares having not less than the minimum number of votes that would be necessary to authorize or take such action at a meeting at which all shares entitled to vote thereon were present and voted. Notwithstanding the foregoing, directors may not be elected by written consent except by unanimous written consent of all shares entitled to vote for the election of directors, except as provided by Section 3.4 hereof.

Where the approval of shareholders is given without a meeting by less than unanimous written consent, unless the consents of all shareholders entitled to vote have been solicited in writing, the secretary shall give prompt notice of the corporate action approved by the shareholders without a meeting. In the case of approval of transactions pursuant to Section 310, 317, 1201 or 2007 of the General Corporation Law of the State of California, the notice shall be given at least 10 days before the consummation of any action authorized by that approval. Such notice shall be given in the same manner as notice of shareholders’ meeting.

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Section 2.3             Voting of Shares.

(a)        In General. Except as otherwise provided in the Restated Articles of Incorporation and subject to subparagraph (b) hereof, each outstanding share, regardless of class, shall be entitled to one (1) vote on each matter submitted to a vote of shareholders.

(b)        Cumulative Voting. At any election of directors, every shareholder complying with this paragraph (b) and entitled to vote may cumulate his or her votes and give one (1) candidate a number of votes equal to the number of directors to be elected multiplied by the number of votes to which the shareholder’s shares are entitled, or distribute the shareholder’s votes on the same principle among as many candidates as the shareholder thinks fit. No shareholder shall be entitled to cumulate votes (i.e., cast for any one (1) or more candidates a number of votes greater than the number of votes which such shareholder normally is entitled to cast) unless such candidate or candidates’ names have been placed in nomination prior to the voting and the shareholder has given notice at the meeting prior to the voting of the shareholder’s intention to cumulate the shareholder’s votes. If any one (1) shareholder has given such notice, all shareholders may cumulate their votes for candidates in nomination. In any election of directors, the candidates receiving the highest number of affirmative votes up to the number of directors to be elected by such shares are elected; votes against a director and votes withheld shall have no legal effect.

(c)        Election by Ballot. Elections for directors need not be by ballot unless a shareholder demands election by ballot at the meeting and before the voting begins.

Section 2.4             Proxies. Every person entitled to vote shares may authorize another person or persons to act by proxy with respect to such shares. No proxy shall be valid after the expiration of 11 months from the date thereof unless otherwise provided in the proxy. Every proxy continues in full force and effect until revoked by the person executing it prior to the vote pursuant thereto, except as otherwise herein provided. Such revocation may be effected by a writing delivered to the corporation stating that the proxy is revoked or by a subsequent proxy executed by the person executing the prior proxy and presented to the meeting, or as to any meeting by attendance at such meeting and voting in person by the person executing the proxy. The dates contained on the forms of proxy presumptively determine the order of execution, regardless of the postmark dates on the envelopes in which they are mailed. A proxy is not revoked by the death or incapacity of the maker unless, before the vote is counted, written notice of such death or incapacity is received by the corporation. The revocability of a proxy that states on its face that it is irrevocable shall be governed by the provisions of Sections 705(e) and 705(f) of the California General Corporation Law.

Section 2.5             Inspectors of Election.

(a)        Appointment. In advance of any meeting of shareholders the Board may appoint inspectors of election to act at the meeting and any adjournment thereof. If inspectors of election are not so appointed, or if any persons so appointed fail to appear or refuse to act, the chairman of any meeting of shareholders may, and on the request of any shareholder or a shareholder’s proxy shall, appoint inspectors of election (or persons to replace those who so fail or refuse) at the meeting. The number of inspectors shall be either one (1) or three (3). If appointed at a meeting on the request of one (1) or more shareholders or proxies, the majority of shares represented in person or by proxy shall determine whether one (1) or three (3) inspectors are to be appointed.

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(b)        Duties. The inspectors of election shall determine the number of shares outstanding and the voting power of each, the shares represented at the meeting, the existence of a quorum and the authenticity, validity and effect of proxies, receive votes, ballots or consents, hear and determine all challenges and questions in any way arising in connection with the right to vote, count and tabulate all votes or consents, determine when the polls shall close, determine the result and do such acts as may be proper to conduct the election or vote with fairness to all shareholders. The inspectors of election shall perform their duties impartially, in good faith, to the best of their ability and as expeditiously as is practical. If there are three inspectors of election, the decision, act or certificate of a majority is effective in all respects as the decision, act or certificate of all. Any report or certificate made by the inspectors of election is prima facie evidence of the facts stated therein.

Section 2.6             Record Date. In order that the corporation may determine the shareholders entitled to notice of any meeting or to vote or entitled to receive payment of any dividend or other distribution or allotment of any rights or entitled to exercise any rights in respect of any other lawful action, the Board may fix, in advance, a record date, which shall not be more than 60 nor less than 10 days prior to the date of such meeting nor more than 60 days prior to any other action. If no record date is fixed:

(1)       The record date for determining shareholders entitled to notice of or to vote at a meeting of shareholders shall be at the close of business on the business day next preceding the day on which notice is given or, if notice is waived, at the close of business on the business day next preceding the day on which the meeting is held.

(2)       The record date for determining shareholders entitled to give consent to corporate action in writing without a meeting, when no prior action by the Board has been taken, shall be the day on which the first written consent is given.

(3)       The record date for determining shareholders for any other purpose shall be at the close of business on the day on which the board adopts the resolution relating thereto, or the 60th day prior to the date of such other action, whichever is later.

A determination of shareholders of record entitled to notice of or to vote at a meeting of shareholders shall apply to any adjournment of the meeting unless the board fixes a new record date for the adjourned meeting, but the board shall fix a new record date if the meeting is adjourned for more than 45 days from the date set for the original meeting.

Shareholders at the close of business on the record date are entitled to notice and to vote or to receive the dividend, distribution or allotment of rights or to exercise the rights, as the case may be, notwithstanding any transfer of any shares on the books of the

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corporation after the record date, except as otherwise provided in the Restated Articles of Incorporation or by agreement or in the California General Corporation Law.

Section 2.7             Share Certificates.

(a)        In General. The corporation shall issue a certificate or certificates representing shares of its capital stock. Each certificate so issued shall be signed in the name of the corporation by the chairman or vice chairman of the board or the president or a vice president and by the chief financial officer or an assistant treasurer or the secretary or any assistant secretary, shall state the name of the record owner thereof and shall certify the number of shares and the class or series of shares represented thereby. Any or all of the signatures on the certificate may be facsimile. In case any officer, transfer agent or registrar who has signed or whose facsimile signature has been placed upon a certificate has ceased to be such officer, transfer agent or registrar before such certificate is issued, it may be issued by the corporation with the same effect as if such person were an officer, transfer agent or registrar at the date of issue.

(b)        Two or More Classes or Series. If the shares of the corporation are classified or if any class of shares has two or more series, there shall appear on the certificate one (1) of the following:

(1)       A statement of the rights, preferences, privileges, and restrictions granted to or imposed upon the respective classes or series of shares authorized to be issued and upon the holders thereof; or

(2)       A summary of such rights, preferences, privileges and restrictions with reference to the provisions of the Restated Articles of Incorporation and any certificates of determination establishing the same; or

(3)       A statement setting forth the office or agency of the corporation from which shareholders may obtain upon request and without charge, a copy of the statement referred to in subparagraph (1).

(c)        Special Restrictions. There shall also appear on the certificate (unless stated or summarized under subparagraph (1) or (2) of subparagraph (b) above) the statements required by all of the following clauses to the extent applicable:

(1)       The fact that the shares are subject to restrictions upon transfer.

(2)       If the shares are assessable, a statement that they are assessable.

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(3)       If the shares are not fully paid, a statement of the total consideration to be paid therefor and the amount paid thereon.

(4)       The fact that the shares are subject to a voting agreement or an irrevocable proxy or restrictions upon voting rights contractually imposed by the corporation.

(5)       The fact that the shares are redeemable.

(6)       The fact that the shares are convertible and the period for conversion.

Section 2.8             Transfer of Certificates. Where a certificate for shares is presented to the corporation or its transfer clerk or transfer agent with a request to register a transfer of shares, the corporation shall register the transfer, cancel the certificate presented, and issue a new certificate if: (a) the security is endorsed by the appropriate person or persons; (b) reasonable assurance is given that those endorsements are genuine and effective; (c) the corporation has no notice of adverse claims or has discharged any duty to inquire into such adverse claims; (d) any applicable law relating to the collection of taxes has been complied with; (e) the transfer is not in violation of any federal or state securities law; and (f) the transfer is in compliance with any applicable agreement governing the transfer of the shares.

Section 2.9             Lost Certificates. Where a certificate has been lost, destroyed or wrongfully taken, the corporation shall issue a new certificate in place of the original if the owner: (a) so requests before the corporation has notice that the certificate has been acquired by a bona fide purchaser; (b) files with the corporation a sufficient indemnity bond, if so requested by the Board of Directors; and (c) satisfies any other reasonable requirements as may be imposed by the Board. Except as above provided, no new certificate for shares shall be issued in lieu of an old certificate unless the corporation is ordered to do so by a court in the judgment in an action brought under Section 419(b) of the California General Corporation Law.

ARTICLE III

DIRECTORS

Section 3.1             Powers. Subject to the provisions of the California General Corporation Law and the Restated Articles of Incorporation, the business and affairs of the corporation shall be managed and all corporate powers shall be exercised by or under the direction of the Board of Directors. The Board may delegate the management of the day-to-day operations of the business of the corporation to a management company or other person provided that the business and affairs of the corporation shall be managed and all corporate powers shall be exercised under the ultimate direction of the Board.

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Section 3.2             Committees of the Board. The Board may, by resolution adopted by a majority of the authorized number of directors, designate one (1) or more committees, each consisting of two or more directors, to serve at the pleasure of the Board. The Board may designate one (1) or more directors as alternate members of any committee, who may replace any absent member at any meeting of the committee. The appointment of members or alternate members of a committee requires the vote of a majority of the authorized number of directors. Any such committee, to the extent provided in the resolution of the Board, shall have all the authority of the Board, except with respect to:

(1)       The approval of any action which also requires, under the California General Corporation Law, shareholders’ approval or approval of the outstanding shares;

(2)       The filling of vacancies on the Board or in any committee.

(3)       The fixing of compensation of the directors for serving on the Board or on any committee.

(4)       The amendment or repeal of bylaws or the adoption of new bylaws.

(5)       The amendment or repeal of any resolution of the Board which by its express terms is not so amendable or repealable.

(6)       A distribution (within the meaning of the California General Corporation Law) to the shareholders of the corporation, except at a rate or in a periodic amount or within a price range determined by the Board.

(7)       The appointment of other committees of the Board or the members thereof.

Section 3.3             Election and Term of Office. The directors shall be elected at each annual meeting of shareholders but, if any such annual meeting is not held or the directors are not elected thereat, the directors may be elected at any special meeting of shareholders held for that purpose. Each director, including a director elected to fill a vacancy, shall hold office until the expiration of the term for which elected and until a successor has been elected and qualified.

Section 3.4             Vacancies. Except for a vacancy created by the removal of a director, vacancies on the Board may be filled by approval of the Board or, if the number of directors then in office is less than a quorum, by (a) the unanimous written consent of the

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directors then in office, (b) the affirmative vote of a majority of the directors then in office at a meeting held pursuant to notice or waivers of notice under the California General Corporation Law, or (c) a sole remaining director. The shareholders may elect a director or directors at any time to fill any vacancy or vacancies not filled by the directors, but any such election by written consent requires the consent of a majority of the outstanding shares entitled to vote.

The Board of Directors shall have the power to declare vacant the office of a director who has been declared of unsound mind by an order of court, or convicted of a felony.

Section 3.5             Removal. Any or all of the directors may be removed without cause if such removal is approved by the vote of a majority of the outstanding shares entitled to vote, except that no director may be removed (unless the entire board is removed) when the votes cast against removal, or not consenting in writing to such removal, would be sufficient to elect such director if voted cumulatively at an election at which the same total number of votes were cast (or, if such action is taken by written consent, all shares entitled to vote were voted) and the entire number of directors authorized at the time of the director’s most recent election were then being elected.

Section 3.6             Resignation. Any director may resign effective upon giving written notice to the chairman of the board, the president, the secretary or the Board of Directors of the corporation, unless the notice specifies a later time for the effectiveness of such resignation. If the resignation is effective at a future time, a successor may be elected to take office when the resignation becomes effective.

Section 3.7             Meetings of the Board of Directors and Committees.

(a)        Regular Meetings. Regular meetings of the Board of Directors may be held without notice at such time and place within or without the State as may be designated front time to time by resolution of the Board or by written consent of all members of the Board or in these bylaws.

(b)        Organization Meeting. Immediately following each annual meeting of shareholders the Board of Directors shall hold a regular meeting for the purpose of organization, election of officers, and the transaction of other business. Notice of such meetings is hereby dispensed with.

(c)        Special Meetings. Special meetings of the Board of Directors for any purpose or purposes may be called at any time by the chairman of the board or the president or, by any vice president or the secretary or any two directors.

(d)        Notices; Waivers. Special meetings shall be held upon four (4) days’ notice by mail or forty-eight (48) hours’ notice delivered personally or by telephone, including a voice messaging system or other system or technology designed to record and communicate messages, telegraph, facsimile, electronic mail, or other electronic means. Notice of a meeting need not be given to any director who signs a waiver of notice or a consent to holding the meeting or an approval of the minutes thereof, whether before or after

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the meeting, or who attends the meeting without protesting, prior thereto or at its commencement, the lack of notice to such director. All such waivers, consents and approvals shall be filed with the corporate records or made a part of the minutes of the meeting.

(e)        Adjournment. A majority of the directors present, whether or not a quorum is present, may adjourn any meeting to another time and place. If the meeting is adjourned for more than 24 hours, notice of such adjournment to another time and place shall be given prior to the time of the adjourned meeting to the directors who were not present at the time of adjournment.

(f)         Place of Meeting. Meetings of the Board may be held at any place within or without the state which has been designated in the notice of the meeting or, if not stated in the notice or there is no notice, then such meeting shall be held at the principal executive office of the corporation, or such other place designated by resolution of the Board.

(g)        Presence by Conference Telephone Call. Members of the Board may participate in a meeting through use of conference telephone or similar communications equipment, so long as all members participating in such meeting can hear one another. Such participation constitutes presence in person at such meeting.

(h)        Quorum. A majority of the authorized number of directors constitutes a quorum of the Board for the transaction of business. Every act or decision done or made by a majority of the directors present at a meeting duly held at which a quorum is present is the act of the Board of Directors, unless a greater number be required by law or by the Restated Articles of Incorporation. A meeting at which a quorum is initially present may continue to transact business notwithstanding the withdrawal of directors, if any action taken is approved by at least a majority of the required quorum for such meeting.

Section 3.8             Action Without Meeting. Any action required or permitted to be taken by the Board of Directors, may be taken without a meeting if all members of the Board shall individually or collectively consent in writing to such action. Such written consent or consents shall be filed with the minutes of the proceedings of the Board. Such action by written consent shall have the same force and effect as a unanimous vote of such directors.

Section 3.9             Committee Meetings. The provisions of Sections 3.7 and 3.8 of these bylaws apply also to committees of the Board and action by such committees, mutatis mutandis.

ARTICLE IV

OFFICERS

Section 4.1             Officers. The officers of the corporation shall consist of a chairman of the board or a president, or both, a secretary, a chief financial officer, and such additional officers as may be elected or appointed in accordance with Section 4.3 of these bylaws and as may be necessary to enable the corporation to sign instruments and share certificates. Any number of offices may be held by the same person.

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Section 4.2             Elections. All officers of the corporation, except such officers as may be otherwise appointed in accordance with Section 4.3, shall be chosen by the Board of Directors, and shall serve at the pleasure of the Board of Directors, subject to the rights, if any, of an officer under any contract of employment.

Section 4.3             Other Officers. The Board of Directors, the chairman of the board, or the president at their or his discretion, may appoint one (1) or more vice presidents, one (1) or more assistant secretaries, a treasurer, one (1) or more assistant treasurers, or such other officers as the business of the corporation may require, each of whom shall hold office for such period, have such authority and perform such duties as the Board of Directors, the chairman of the board, or the president, as the case may be, may from time to time determine.

Section 4.4             Removal. Subject to the rights, if any, of an officer under any contract of employment, any officer may be removed, either with or without cause, by the Board of Directors, or, except in case of an officer chosen by the Board of Directors, by any officer upon whom such power of removal may be conferred by the Board of Directors, without prejudice to the rights, if any, of the corporation under any contract to which the officer is a party.

Section 4.5             Resignation. Any officer may resign at any time by giving written notice to the Board of Directors or to the president, or to the secretary of the corporation without prejudice to the rights, if any, of the corporation under any contract to which the officer is a party. Any such resignation shall take effect at the date of the receipt of such notice or at any later time specified therein; and, unless otherwise specified therein, the acceptance of such resignation shall not be necessary to make it effective.

Section 4.6             Vacancies. A vacancy in any office because of death, resignation, removal, disqualification or any other cause shall be filled in the manner prescribed in these bylaws for regular appointments to such office.

Section 4.7             Chairman of the Board. The chairman of the board, if there shall be such an officer, shall, if present, preside at all meetings of the Board of Directors and exercise and perform such other powers and duties as may be from time to time assigned to him by the Board of Directors. If there is no president, the chairman of the board shall in addition be the chief executive officer of the corporation and shall have the powers and duties prescribed in Section 4.8 below.

Section 4.8             President. Subject to such supervisory powers, if any, as may be given by the Board of Directors to the chairman of the board, if there be such an officer, the president shall be general manager and chief executive officer of the corporation and shall, subject to the control of the Board of Directors, have general supervision, direction and control of the business and affairs of the corporation. He shall preside at all meetings of the shareholders and, in the absence of the chairman of the board, or if there be none, at all meetings of the Board of Directors. He shall be ex-officio a member of all the standing committees, including the executive committee, if any, and shall have the general powers and duties of management usually vested in the office of president of a corporation, and shall have such other powers and duties as may be prescribed by the Board of Directors or these bylaws.

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Section 4.9             Vice President. In the absence of the president or in the event of the president’s inability or refusal to act, the vice president, or in the event there be more than one (1) vice president, the vice president designated by the Board of Directors, or if no such designation is made, in order of their election, shall perform the duties of president and when so acting, shall have all the powers of and be subject to all the restrictions upon the president. Any vice president shall perform such other duties as from time to time may be assigned to such vice president by the president or the Board of Directors.

Section 4.10           Secretary. The secretary shall keep or cause to be kept the minutes of proceedings and record of shareholders, as provided for and in accordance with Section 5.1(a) of these bylaws.

The secretary shall give, or cause to be given, notice of all meetings of the shareholders and of the Board of Directors required by these bylaws or by law to be given, and shall have such other powers and perform such other duties as may be prescribed by the Board of Directors.

Section 4.11           Chief Financial Officer. The chief financial officer shall have general supervision, direction and control of the financial affairs of the corporation and shall have such other powers and duties as may be prescribed by the Board of Directors or these bylaws. In the absence of a named treasurer, the chief financial officer shall also have the powers and duties of the treasurer as hereinafter set forth and shall be authorized and empowered to sign as treasurer in any case where such officer’s signature is required.

Section 4.12           Treasurer. The treasurer shall keep or cause to be kept the books and records of account as provided for and in accordance with Section 5.1(a) of these bylaws. The books of account shall at all reasonable times be open to inspection by any director.

The treasurer shall deposit all moneys and other valuables in the name and to the credit of the corporation with such depositaries as may be designated by the Board of Directors. He shall disburse the funds of the corporation as may be ordered by the Board of Directors, shall render to the president and directors, whenever they request it, an account of all of his transactions as treasurer and of the financial condition of the corporation, and shall have such other powers and perform such other duties as may be prescribed by the Board of Directors or these bylaws. In the absence of a named chief financial officer, the treasurer shall be deemed to be the chief financial officer and shall have the powers and duties of such office as hereinabove set forth.

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ARTICLE V

MISCELLANEOUS

Section 5.1             Records and Reports.

(a)        Books of Account and Proceedings. The corporation shall keep adequate and correct books and records of account and shall keep minutes of the proceedings of its shareholders, Board and committees of the board and shall keep at its principal executive office, or at the office of its transfer agent or registrar, a record of its shareholders, giving the names and addresses of all shareholders and the number and class of shares held by each. Such minutes shall be kept in written form. Such other books and records shall be kept either in written form or in any other form capable of being converted into written form.

(b)        Annual Report. An annual report to shareholders referred to in Section 1501 of the California General Corporation Law is expressly dispensed with, but nothing herein shall be interpreted as prohibiting the Board of Directors from issuing annual or other periodic reports to the shareholders of the corporation as they consider appropriate.

(c)        Shareholders’ Requests for Financial Reports. If no annual report for the last fiscal year has been sent to shareholders, the corporation shall, upon the written request of any shareholder made more than 120 days after the close of that fiscal year, deliver or mail to the person making the request within 30 days thereafter the financial statements for that year required by Section 1501(a) of the California General Corporation Law. Any shareholder or shareholders holding at least five (5) percent of the outstanding shares of any class of the corporation may make a written request to the corporation for an income statement of the corporation for the three-month, six-month or nine-month period of the current fiscal year ended more than 30 days prior to the date of the request and a balance sheet of the corporation as of the end of such period, and the corporation shall deliver or mail the statements to the person making the request within 30 days thereafter. A copy of the statements shall be kept on file in the principal office of the corporation for 12 months and they shall be exhibited at all reasonable times to any shareholder demanding an examination of them or a copy shall be mailed to such shareholder upon demand.

Section 5.2             Rights of Inspection.

(a)        By Shareholders.

(1)       Record of Shareholders. Any shareholder or shareholders holding at least five (5) percent in the aggregate of the outstanding voting shares of the corporation or who hold at least one (1) percent of such voting shares and have filed a Schedule 14A with the United States Securities and Exchange Commission shall have an absolute right to do either or both of the following: (i) inspect and copy the record of shareholders’ names and addresses and shareholdings during usual business hours upon five (5) business days’ prior written demand upon the corporation, or (ii) obtain from the transfer agent for the corporation, upon written demand and upon the tender of its usual charges for such a list (the amount of which charges shall be stated to the shareholder by the transfer agent upon request), a list of the shareholders’ names and addresses, who are entitled to vote for the election of directors, and their shareholdings, as of the most recent record date for which it has been compiled or as of a date specified by the shareholder subsequent to the date of demand. The list shall be made available on or before the later of five (5) business

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days after demand is received or the date specified therein as the date as of which the list is to be compiled.

The record of shareholders shall also be open to inspection and copying by any shareholder or holder of a voting trust certificate at any time during usual business hours upon written demand on the corporation, for a purpose reasonably related to such holder’s interests as a shareholder or holder of a voting trust certificate.

(2)       Corporate Records. The accounting books and records and minutes of proceedings of the shareholders and the Board and committees of the board shall be open to inspection upon the written demand on the corporation of any shareholder or holder of a voting trust certificate at any reasonable time during usual business hours, for a purpose reasonably related to such holder’s interests as a shareholder or as the holder of such voting trust certificate. This right of inspection shall also extend to the records of any subsidiary of the corporation.

(3)       Bylaws. The corporation shall keep at its principal executive office in this state, the original or a copy of its bylaws as amended to date, which shall be open to inspection by the shareholders at all reasonable times during office hours.

(b)        By Directors. Every director shall have the absolute right at any reasonable time to inspect and copy all books, records and documents of every kind and to inspect the physical properties of the corporation of which such person is a director and also of its subsidiary corporations, domestic or foreign. Such inspection by a director may be made in person or by agent or attorney and the right of inspection includes the right to copy and make extracts.

Section 5.3             Checks, Drafts, Etc. All checks, drafts or other orders for payment of money, notes or other evidences of indebtedness, issued in the name of or payable to the corporation, shall be signed or endorsed by such person or persons and in such manner as, from time to time, shall be determined by resolution of the Board of Directors.

Section 5.4             Representation of Shares of Other Corporations. The chairman of the board, if any, president or any vice president of the corporation, or any other person authorized to do so by the chairman of the board, president or any vice president, is authorized to vote, represent and exercise on behalf of the corporation all rights incident to any and all shares of any other corporation or corporations standing in the name of the corporation. The authority herein granted to said officers to vote or represent on behalf of the corporation any and all shares held by the corporation in any other corporation or corporations may be exercised either by such officers in person or by any other person authorized so to do by proxy or power of attorney duly executed by said officers.

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Section 5.5             Indemnification and Insurance.

(a)        Right to Indemnification. Each person who was or is made a party to or is threatened to be made a party to or is involuntarily involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative (hereinafter a “Proceeding”), by reason of the fact that he or she, or a person of whom he or she is the legal representative, is or was a director or officer of the corporation or is or was serving (during such person’s tenure as director or officer) at the request of the corporation, any other corporation, partnership, joint venture, trust or other enterprise in any capacity, whether the basis of a Proceeding is an alleged action in an official capacity as a director or officer or in any other capacity while serving as a director or officer, shall be indemnified and held harmless by the corporation to the fullest extent authorized by California General Corporation Law, as the same exists or may hereafter be amended (but, in the case of any such amendment, only to the extent that such amendment permits the corporation to provide broader indemnification rights than said law permitted the corporation to provide prior to such amendment), against all expenses, liability and loss (including attorneys’ fees, judgments, fines, or penalties and amounts to be paid in settlement) reasonably incurred or suffered by such person in connection therewith. The right to indemnification conferred in this Section shall be a contract right and shall include the right to be paid by the corporation the expenses incurred in defending a Proceeding in advance of its final disposition; provided, however, that, if California General Corporation Law requires, the payment of such expenses in advance of the final disposition of a Proceeding shall be made only upon receipt by the corporation of an undertaking by or on behalf of such director or officer to repay all amounts so advanced if it shall ultimately be determined that such director or officer is not entitled to be indemnified under this Section or otherwise. No amendment to or repeal of this Section 5.5 shall apply to or have any effect on any right to indemnification provided hereunder with respect to any acts or omissions occurring prior to such amendment or repeal.

(b)        Right of Claimant to Bring Suit. If a claim for indemnity under paragraph (a) of this Section is not paid in full by the corporation within 90 days after a written claim has been received by the corporation, the claimant may at any time thereafter bring suit against the corporation to recover the unpaid amount of the claim and, if successful in whole or in part, the claimant shall also be entitled to be paid the expense of prosecuting such claim including reasonable attorneys’ fees incurred in connection therewith. It shall be a defense to any such action (other than an action brought to enforce a claim for expenses incurred in defending a Proceeding in advance of its final disposition where the required undertaking, if any is required, has been tendered to the corporation) that the claimant has not met the standards of conduct which make it permissible under California General Corporation Law for the corporation to indemnify the claimant for the amount claimed, but the burden of proving such defense shall be on the corporation. Neither the failure of the corporation (including its Board of Directors, independent legal counsel, or its shareholders) to have made a determination prior to the commencement of such action that indemnification of the claimant is proper in the circumstances because he or she has met the applicable standard of conduct set forth in California General Corporation Law, nor an actual determination by the corporation (including its Board of Directors, independent legal counsel, or its shareholders) that the claimant has not met such applicable standard of conduct, shall be a defense to the action or create a presumption that the claimant has not met the applicable standard of conduct.

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(c)        Non-Exclusivity of Rights. The rights conferred in this Section shall not be exclusive of any other rights which any director, officer, employee or agent may have or hereafter acquire under any statute, provision of the Restated Articles of Incorporation, bylaw, agreement, vote of shareholders or disinterested directors or otherwise, to the extent the additional rights to indemnification are authorized in the Restated Articles of Incorporation of the corporation.

(d)        Insurance. In furtherance and not in limitation of the powers conferred by statute:

(1)       the corporation may purchase and maintain insurance on behalf of any person who is or was a director, officer, employee or agent of the corporation, or is serving at the request of the corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any expense, liability or loss, whether or not the corporation would have the power to indemnify the person against that expense, liability or loss under the California General Corporation Law.

(2)       the corporation may create a trust fund, grant a security interest and/or use other means (including, without limitation, letters of credit, surety bonds and/or other similar arrangements), as well as enter into contracts providing indemnification to the full extent authorized or permitted by law and including as part thereof provisions with respect to any or all of the foregoing to ensure the payment of such amounts as may become necessary to effect indemnification as provided therein, or elsewhere.

(e)        Indemnification of Employees and Agents of the Corporation. The corporation may, to the extent authorized from time to time by the Board of Directors, grant rights to indemnification, including the right to be paid by the corporation the expenses incurred in defending a Proceeding in advance of its final disposition, to any employee or agent of the corporation to the fullest extent of the provisions of this Section or otherwise with respect to the indemnification and advancement of expenses of directors and officers of the corporation.

Section 5.6             Employee Stock Purchase Plans. The corporation may adopt and carry out a stock purchase plan or agreement or stock option plan or agreement providing for the issue and sale for such consideration as may be fixed of its unissued shares, or of issued shares acquired or to be acquired, to one (1) or more of the employees or directors of the corporation or of a subsidiary or to a trustee on their behalf and for the payment for such shares in installments or at one (1) time, and may provide for aiding any such persons in paying for such shares by compensation for services rendered, promissory notes or otherwise.

A stock purchase plan or agreement or stock option plan or agreement may include, among other features, the fixing of eligibility for participation therein, the class and price of shares to be issued or sold under the plan or agreement, the number of shares which

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may be subscribed for, the method of payment therefor, the reservation of title until full payment therefor, the effect of the termination of employment, an option or obligation on the part of the corporation to repurchase the shares upon termination of employment, subject to the provisions of the California General Corporation Law, restrictions upon transfer of the shares and the time limits of and termination of the plan.

Section 5.7             Time Notice Given or Sent. Any reference in these Bylaws to the time a notice is given or sent means, unless otherwise expressly provided herein or by law, (a) the time a written notice by mail is deposited in the United States mails, postage prepaid; or (b) the time any other written notice, including facsimile, telegram, or electronic mail message, is personally delivered to the recipient or is delivered to a common carrier for transmission, or actually transmitted by the person giving the notice by electronic means, to the recipient; or (c) the time any oral notice is communicated, in person or by telephone, including a voice messaging system or other system or technology designed to record and communicate messages, or wireless, to the recipient, including the recipient’s designated voice mailbox or address on such system, or to a person at the office of the recipient who the person giving the notice has reason to believe will promptly communicate it to the recipient.

Section 5.8             Construction and Definitions. Unless the context otherwise requires, the general provisions, rules of construction and definitions contained in the California General Corporation Law shall govern the construction of these bylaws. Without limiting the generality of the foregoing, the masculine gender includes the feminine and neuter, the singular number includes the plural and the plural number includes the singular, and the term “person” includes a corporation as well as a natural person.

ARTICLE VI

AMENDMENTS

Section 6.1             Power of Shareholders. New bylaws may be adopted or these bylaws may be amended or repealed by the vote of shareholders entitled to exercise a majority of the voting power of the corporation or by the written assent of such shareholders, except as otherwise provided by law or by the Restated Articles of Incorporation.

Section 6.2             Power of Directors. Subject to the right of shareholders as provided in Section 6.1 to adopt, amend or repeal bylaws, any bylaw may be adopted, amended or repealed by the Board of Directors other than a bylaw or amendment thereof changing the authorized number of directors, if such number is fixed, or the maximum-minimum limits thereof, if an indefinite number.

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THIS IS TO CERTIFY:

That I am the duly elected, qualified and acting Secretary of Malibu Research Associates, Inc., a California corporation, and that the foregoing bylaws were adopted as the bylaws of said corporation as of the 10th day of August, 2007, by the Board of Directors and the sole shareholder of said corporation.

Dated as of August 10, 2007
	/s/ Joel A. Littman
	Joel A. Littman, Secretary

EX-3.13

Exhibit 3.13

CERTIFICATE OF CONVERSION

FROM A CORPORATION

TO LIMITED LIABILITY COMPANY

Pursuant to Sections 18-204 and 18-214 of the

Delaware Limited Liability Company Act

and Section 266 of the

General Corporation Law of the State of Delaware

1.             The name of the Corporation immediately prior to the filing of this Certificate of Conversion is Communications & Power Industries, Inc.  The Corporation was originally incorporated under the same name.

2.             The Corporation was originally incorporated on the 12th day of June, 1995, under the laws of the State of Delaware.  The Corporation’s jurisdiction of incorporation immediately prior to the filing of this Certificate of Conversion is the State of Delaware.

3.             The name of the limited liability company into which the Corporation shall be converted, as set forth in its Certificate of Formation, is Communications & Power Industries LLC.

4.             The Conversion has been approved in accordance with the provisions of Section 266 of the General Corporation Law of the State of Delaware.

5.             This Certificate of Conversion shall be effective at 8:49 a.m. on February 11, 2011.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF, the Corporation has caused this Certificate of Conversion to be executed in its name this 10th day of February, 2011.

COMMUNICATIONS & POWER
INDUSTRIES, INC.
By:	/s/ Robert A. Fickett
Name: Robert A. Fickett
Title: Authorized Officer

EX-3.14

Exhibit 3.14

CERTIFICATE OF FORMATION

OF

COMMUNICATIONS & POWER INDUSTRIES LLC

1.                       The name of the limited liability company is Communications & Power Industries LLC.

2.                       The address of its registered office in the State of Delaware is 615 South DuPont Highway, in the City of Dover, County of Kent.  The name of its registered agent at such address is National Corporate Research, Ltd.

3.                       This Certificate of Formation shall be effective at 8:49 a.m. on February 11, 2011.

IN WITNESS WHEREOF, the undersigned has executed this Certificate of Formation this 10th day of February, 2011.

By:	/s/ Robert A. Fickett
Name: Robert A. Fickett
Title: Authorized Person

EX-3.15

Exhibit 3.15

EXECUTION COPY

LIMITED LIABILITY COMPANY AGREEMENT

OF

COMMUNICATIONS & POWER INDUSTRIES LLC

THIS LIMITED LIABILITY COMPANY AGREEMENT of Communications & Power Industries LLC (the “Company”), dated as of the 11th day of February, 2011 (this “Agreement”), is made by CPI International, Inc., a Delaware corporation, as the initial sole member of the Company (the “Initial Member”), and by and between the Initial Member and/or any person(s) or entity(ies) subsequently admitted as a member or members of the Company in accordance with the terms hereof (the Initial Member and any such person(s) or entity(ies) being sometimes referred to individually as a “Member” and collectively as the “Members”).

RECITAL

The Company was formed as a limited liability company under the laws of the State of Delaware, and the Initial Member desires to enter into a written agreement, in accordance with the provisions of the Delaware Limited Liability Company Act and any successor statute, as amended from time to time (the “Act”), governing the affairs of the Company and the conduct of its business.

ARTICLE I

DEFINITIONS

Capitalized terms used but not otherwise defined herein shall have the meanings assigned to them in the Act.

ARTICLE II

THE LIMITED LIABILITY COMPANY

2.1           Formation.  The Company was formed as a limited liability company pursuant to the provisions of the Act.  A certificate of formation for the Company as described in Section 18-201 of the Act (the “Certificate of Formation”) has been filed in the Office of the Secretary of State of the State of Delaware in conformity with the Act.  The Initial Member hereby ratifies and confirms the authority of Robert A. Fickett as an authorized person within the meaning of Sections 18-201 and 18-204 of the Act to execute the Certificate of Formation and to cause it to be so filed.

2.2           Name.  The name of the Company is “Communications & Power Industries LLC” and its business shall be carried on in such name with such variations and changes as the Board of Managers from time to time shall determine or deem necessary to comply with requirements of the jurisdictions in which the Company’s operations are conducted.

2.3           Business Purpose; Powers.  The Company is formed for the purpose of engaging in any lawful business, purpose or activity for which limited liability companies may be formed under the Act. The Company shall possess and may exercise all the powers and privileges granted by the Act or by any other law or by this Agreement, together with any powers incidental thereto, so far as such powers and privileges are necessary or convenient to the conduct, promotion or attainment of the business purposes or activities of the Company.  Without limiting the scope of the foregoing, the purpose of the Company includes the development, manufacture and distribution of products used to generate, amplify, transmit and receive high-power/high-frequency microwave and radio frequency signals and/or provide power and control for end use commercial and defense-related applications.

2.4           Registered Office and Agent.  The location of the registered office of the Company shall be 615 South DuPont Highway, Dover, Delaware 19901.  The Company’s Registered Agent at such address shall be National Corporate Research, Ltd.

2.5           Term.  The term of the Company commenced on the date of the filing of the Certificate of Formation in the Office of the Secretary of State of the State of Delaware.  Subject to the provisions of Article VII below, the Company shall have perpetual existence.

2.6           No State Law Partnership.  The Member(s) intend(s) that for state law purposes the Company not be a partnership (including a limited partnership) or joint venture and that no Member be a partner or joint venturer of any other Member for any purpose.  This Agreement may not be construed to suggest otherwise; though, for the avoidance of doubt, this Section 2.6 shall have no bearing on the classification of the Company for U.S. federal income tax purposes.

2.7           Fiscal Year.  The fiscal year of the Company for financial statement and federal income tax purposes shall be determined by the Board of Managers (as defined in Section 3.2).

ARTICLE III

MEMBERS

3.1           Members.  The name, address and percentage (“Common Interest Percentage”) of all outstanding Common Interests (as hereinafter defined) of the Member(s) is set forth on Schedule A hereto, which shall be amended from time to time to reflect the admission of new Members, additional capital contributions of Members or the Transfer (as hereinafter defined) of Common Interests of any Member.

3.2           Admission of New Members.  Additional persons or entities shall be admitted as Members of the Company only upon the approval of the Board of Managers, subject to receipt by the Company of a written agreement (which may take the form of a counterpart of this Agreement) executed by such persons or entities proposed to become Members pursuant to which such persons or entities thereby agree to be bound by the terms of this Agreement, at which time such persons or entities shall be bound by this Agreement and admitted as Members.

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3.3           Actions by Members; Meetings.  The Member or Members holding, in the aggregate, a majority of the outstanding Common Interests (a “Majority of Members”)  (or Members holdings such Common Interest Percentage sufficient to approve any such action pursuant to the terms of this Agreement or the Act (the “Required Members”)) may approve a matter or take any action at a meeting or without a meeting by the written consent of such Majority of Members or Required Members.  Meetings of Members may be called at any time by the Board of Managers.

3.4           No Liability of Members.  All debts, obligations and liabilities of the Company, whether arising in contract, tort or otherwise, shall be solely the debts, obligations and liabilities of the Company, and no Member shall be obligated personally for any such debt, obligation or liability of the Company solely by reason of being a Member.

3.5           Power to Bind the Company.  No Member (acting in its capacity as such) shall have any authority to bind the Company to any third party with respect to any matter except by written approval of a Majority of Members that expressly authorizes such matter and authorizes such Member to bind the Company with respect thereto; provided, however, that the Initial Member (acting in its capacity as such) shall have the authority to bind the Company to any third party with respect to any matter until such time as any new Member is admitted pursuant to the terms hereof at which time the foregoing limitation on the power of the Members to bind the Company shall apply to all Members, including the Initial Member.

ARTICLE IV

MANAGEMENT

4.1           General.

(a)           Except for situations in which the approval of any Member is expressly required hereunder or by non-waivable provisions of applicable law or as otherwise expressly required by this Agreement, the powers of the Company shall be exercised by or under the authority of, and the business and affairs of the Company shall be managed under the direction of, a board of Managers (the “Board of Managers”), and the Board of Managers may make all decisions and take all actions for the Company not otherwise expressly provided for in this Agreement.  The Board of Managers shall be the managers of the Company within the meaning of Section 18-402 of the Act.  Subject to the Act or as otherwise provided in this Agreement, the Board of Managers must act as a board, and no individual Manager, as such, shall have any authority to bind or act for, or assume any obligation or responsibility on behalf of, the Company unless expressly authorized to do so by action taken by the Board of Managers in accordance with this Agreement.

(b)           The Member(s) shall not have regular meetings or voting rights with respect to the management of the Company and, except as expressly required by non-waivable provisions of applicable law, shall not be entitled to vote on or consent to or approve or disapprove actions or decisions regarding the Company, except for those matters requiring approval expressly provided for in this Agreement.

(c)           Any duties (including fiduciary duties) of a Covered Person to the Company or to any other Covered Person that would otherwise apply at law or in equity are hereby eliminated to the fullest extent permitted under the Act and any other Applicable Law; provided, that (i) the

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foregoing shall not eliminate the obligation of each Member to act in compliance with the express terms of this Agreement and (ii) the foregoing shall not be deemed to eliminate the implied contractual covenant of good faith and fair dealing.

4.3           Board of Managers.

(a)           The Board shall be comprised of one (1) to (10) individuals (the “Managers”), with the exact number of Managers comprising the Board to be determined from time to time by a Majority of the Members. The Managers shall be elected by a Majority of the Members.  The Board of Managers shall initially consist of six (6) members.  The Initial Member shall have the right to appoint all members of the initial Board of Managers.  The names of the initial members of the Board of Managers are set forth on Exhibit A, as such may be reasonably promptly amended from time to time to reflect any change in the composition of the Board of Managers pursuant to the terms of this Article IV.

(b)           Each Manager shall hold office until his or her successor shall have been appointed and qualified or until his or her earlier resignation, removal, death or disability.

(c)           A Majority of Members shall have the right to remove, with or without cause, any Manager and to fill any vacancy created by the death, disability, removal or resignation of any Manager. A Manager chosen to fill a vacancy shall serve the unexpired term of his predecessor in office.

(d)           Without limitation of Section 4.1, the Board of Managers shall have the authority to appoint and terminate officers of the Company (the “Officers”) and retain and terminate employees, agents and consultants of the Company and to delegate such duties to any such Officers, employees, agents and consultants as the Board of Managers deem appropriate, including the power, acting individually or jointly, to represent and bind the Company in all matters, in accordance with the scope of their respective duties.  The Initial Member shall have the right to appoint the initial Officers.  The names of the initial Officers are set forth on Exhibit B, as such may be reasonably promptly amended from time to time to reflect any appointment or termination of Officers pursuant to the terms of this Article IV.

(e)           Each Officer shall serve until the earlier of his death, disability, resignation or removal by the Board of Managers.  Any vacancy occurring in the office of any Officer may be filled by the Board of Managers.

(f)            Written notice stating the place, day and time of every meeting of the Board of Managers and, in case of a special meeting, the purpose or purposes for which the meeting is called, shall be delivered not less than three nor more than thirty calendar days before the date of the meeting (or if sent by facsimile or email, not less than two business days before the date of the meeting), in each case to each Manager at his or her notice address maintained in the records of the Company.  Such further notice shall be given as may be required by applicable law, but meetings may be held without notice if all the members of the Board of Managers entitled to vote at the meeting are present in person or by telephone or represented by proxy or if notice is waived in writing by those not present, either before or after the meeting.

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(g)           Unless otherwise provided by applicable law or this Agreement, the presence of Managers constituting a majority of the voting authority of the whole Board of Managers shall be necessary to constitute a quorum for the transaction of business.  At any meeting of the Board of Managers where a quorum is present, a majority vote of the voting authority of those Managers present will constitute an act of the Board of Managers.  If such quorum is not present within sixty minutesafter the time appointed for such meeting, such meeting shall be adjourned and the President or acting Chairman shall reschedule the meeting to be held not fewer than two nor more than ten business days thereafter.  If such meeting is rescheduled two consecutive times, then those Managers who are present or represented by proxy at the second such rescheduled meeting shall constitute a valid quorum for all purposes hereunder; provided, that written notice of any rescheduled meeting shall have been delivered to all Managers at least two business days prior to the date of such rescheduled meeting.  Notwithstanding any provision to the contrary contained herein, interested Managers may be counted in determining the presence of a quorum at a meeting of the Board of Managers or of a committee that authorizes any interested party contract or transaction.

(h)           Each Manager shall be entitled to one vote on each matter to be voted on by the Board of Managers.

(i)            Meetings of the Board may be conducted in person or by conference telephone facilities.  Any action required or permitted to be taken at any meeting of the Board of Managers may be taken without a meeting if the Managers holding a number of votes necessary to approve an action at a meeting of the Board of Managers (assuming all Managers are present at such meeting) pursuant to the terms of this Agreement consent thereto in writing.  Any such written consents shall be filed with the minutes of the proceedings of the Board of Managers.

(j)            Persons dealing with the Company are entitled to rely conclusively upon the power and authority of the Board of Managers herein set forth.

ARTICLE V

CAPITAL STRUCTURE AND CONTRIBUTIONS; CAPITAL ACCOUNTS

5.1           Capital Structure.  The capital structure of the Company shall consist of one class of common interests (the “Common Interests”).  All Common Interests shall be identical with each other in every respect.

5.2           Capital Contributions.  From time to time, the Board of Managers may determine that the Company requires capital and may make capital contribution(s) in an amount determined by the Board of Managers.  In accordance with Section 18-301(d) of the Act, the Initial Member and any additional Member may be admitted to the Company as a Member and may receive Common Interests without making a contribution or being obligated to make a contribution to the Company.

5.3           Transfer of Common Interest.  A transferee (pursuant to a Transfer in accordance with the terms of this Agreement) of all (or a portion) of a Common Interest will succeed to the Capital Account (or portion of the Capital Account) attributable to the Transferred Common Interest.

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ARTICLE VI

PROFITS, LOSSES AND DISTRIBUTIONS

6.1           Profits and Losses.  The Company’s net profits or net losses shall be determined on an annual basis in accordance with the manner determined by the Board of Managers, in its sole and absolute discretion.

6.2           Distributions.  The Board of Managers shall determine, in its sole and absolute discretion, when cash or other Company assets are available for distribution to the Member(s) in compliance with the Act, and the amount, if any, to be distributed to the Member(s), and shall authorize and distribute on the Common Interests to the Member(s), pro rata in proportion to its (their) respective Common Interest Percentages, the determined amount when, as and if declared by the Board of Managers.  No distribution shall be made to the extent prohibited under the Act.

ARTICLE VII

ADMINISTRATIVE PROVISIONS

7.1           Accounting Method.  The accounting for purposes of the Company shall be in accordance with accounting principles determined by the Board of Managers.

7.2           Entity Classification.  For U.S. federal income tax purposes, the Company shall be disregarded as an entity separate from its owner within the meaning of Treasury Regulation §301.7701-3 and shall not make an election to be classified as a corporation.

ARTICLE VIII

EVENTS OF DISSOLUTION OF THE COMPANY

8.1           Dissolution.  The Company shall dissolve, and its affairs shall be wound up only upon the first to occur of the following:  (i) the written consent of the Board of Managers; (ii) the sale of substantially all of the assets of the Company; (iii) the entry of a decree of judicial dissolution under Section 18-802 of the Act or (iv) at any time there is no member of the Company unless the Company is continued in accordance with the Act.  The Members shall continue to be allocated profit and loss, in the manner set forth in Section 6.1 during the liquidation.  The proceeds from liquidation of Company assets shall be applied as follows:

(1)           satisfaction (whether by payment or the making of reasonable provision for payment) of debts of the Company other than to the Members;

(2)           to payment of amounts owed to the Members for amounts borrowed from and not repaid to the Members; and

(3)           to the Members in accordance with Section 6.2.

8.2           Effect of Dissolution.  Upon dissolution, the Company shall cease carrying on business but shall not be terminated and shall wind up current Company business.  The Company shall continue

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in existence until the winding up of the affairs of the Company is completed and the certificate of cancellation has been issued by the Secretary of State of the State of Delaware with respect to the Certificate of Formation.

8.3           Gains or Losses in Winding-Up.  Any gain or loss on disposition of Company properties in the process of liquidation shall be credited or charged to the Members in the manner set forth in Section 6.1.  Any property distributed in kind in the liquidation of the Company shall be valued and treated as though the property were sold and the cash proceeds were distributed.  The difference between the value of the property distributed in kind and its book value shall be treated as again or loss on sale of the property and shall be credited or charged to the Members in the manner set forth in Section 6.1.

8.4           Termination.  The Company shall terminate when all of the assets of the Company, after payment of or due provision for all debts, liabilities and obligations of the Company shall have been distributed to the Members in the manner provided for in this Article VIII, and the certificate of formation of the Company in effect as of the date thereof shall have been canceled in the manner required by the Act.

ARTICLE IX

TRANSFER OF INTERESTS IN THE COMPANY

A Member may sell, assign, transfer, convey, gift, exchange or otherwise dispose of (each, a “Transfer”) any or all of its Common Interests and, subject to Section 3.2, upon receipt by the Company of a written agreement (which may take the form of a counterpart of this Agreement) executed by the person or entity to whom such Common Interests are to be Transferred pursuant to which such person or entity thereby agrees to be bound by the terms of this Agreement, such person or entity shall be bound by this Agreement and admitted as a Member.  A Member shall automatically cease to be deemed a Member under this Agreement (an “Exiting Member”) in the event that (i) such Member has Transferred all Common Interests held by such Member, in one or a series of transactions and in accordance with the terms hereof, to other persons or entities and (ii) if one or more of the following is true: (x) at least one transferee of such Transferred Common Interests is already a Member, (y) a Member other than the Exiting Member is in existence or (z) at least one transferee of such Transferred Common Interests has been admitted as a Member pursuant to the preceding sentence.

ARTICLE X

EXCULPATION AND INDEMNIFICATION

10.1         Exculpation.  Notwithstanding any other provisions of this Agreement, whether express or implied, or any obligation or duty at law or in equity, none of the Member, Managers, or any officers, directors, stockholders, partners, employees, affiliates, representatives or agents of any of the foregoing, nor any officer, employee, representative or agent of the Company (individually, a “Covered Person” and, collectively, the “Covered Persons”) shall be liable to the Company or any other person for any act or omission (in relation to the Company, its property or the conduct of its business or affairs, this Agreement, any related document or any transaction or investment contemplated hereby or thereby) taken or omitted by a Covered Person in the reasonable belief that

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such act or omission is in or is not contrary to the best interests of the Company and is within the scope of authority granted to such Covered Person by the Agreement, provided such act or omission does not constitute fraud, willful misconduct, bad faith, or gross negligence.

10.2         Indemnification.  To the fullest extent permitted by law, the Company shall indemnify and hold harmless each Covered Person from and against any and all losses, claims, demands, liabilities, expenses, judgments, fines, settlements and other amounts arising from any and all claims, demands, actions, suits or proceedings, civil, criminal, administrative or investigative (“Claims”), in which the Covered Person may be involved, or threatened to be involved, as a party or otherwise, by reason of its management of the affairs of the Company or which relates to or arises out of theCompany or its property, business or affairs. A Covered Person shall not be entitled to indemnification under this Section 10.2 with respect to (i) any Claim with respect to which such Covered Person has engaged in fraud, willful misconduct, bad faith or gross negligence or (ii) any Claim initiated by such Covered Person unless such Claim (or part thereof) (A) was brought to enforce such Covered Person’s rights to indemnification hereunder or (B) was authorized or consented to by the Board. Expenses incurred by a Covered Person in defending any Claim shall be paid by the Company in advance of the final disposition of such Claim upon receipt by the Company of an undertaking by or on behalf of such Covered Person to repay such amount if it shall be ultimately determined that such Covered Person is not entitled to be indemnified by the Company as authorized by this Section 10.2.

10.3         Amendments.  Any repeal or modification of this Article X by the Member shall not adversely affect any rights of such Covered Person pursuant to this Article X, including the right to indemnification and to the advancement of expenses of a Covered Person existing at the time of such repeal or modification with respect to any acts or omissions occurring prior to such repeal or modification.

ARTICLE XI

MISCELLANEOUS

11.1         Amendments.  Except as otherwise provided in this Agreement, amendments to this Agreement and to the Certificate of Formation shall be approved in writing by the Board of Managers.  An amendment shall become effective as of the date specified in the approval of the Board of Managers, or if none is specified, as of the date of such approval or as otherwise provided in the Act.  Notwithstanding anything to the contrary set forth in this Section 11.1, upon a Transfer of a Common Interest in accordance with this Agreement, Schedule A, Schedule B, Exhibit A, Exhibit B or other schedules or exhibits, as applicable, shall be amended, without the consent of any Member, to reflect such Transfer and the Transferee shall be admitted as a Member and shall be subject to the terms and conditions of this Agreement.

11.2         Severability.  If any provision of this Agreement is held to be invalid or unenforceable for any reason, such provision shall be ineffective to the extent of such invalidity or unenforceability; provided, however, that the remaining provisions will continue in full force without being impaired or invalidated in any way unless such invalid or unenforceable provision or clause shall be so significant as to materially affect the expectations of the Member(s) regarding this Agreement.  Otherwise, any invalid or unenforceable provision shall be replaced by the Board of Managers with a valid provision which most closely approximates the intent and economic effect of the invalid or unenforceable provision.

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11.3         Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware without regard to the principles of conflicts of laws thereof.  In particular, this Agreement shall be construed to the maximum extent possible to comply with all the terms and conditions of the Act.

11.4         Successors; Counterparts.  Subject to Section 3.2 and Article VIII, this Agreement (a) shall be binding as to the executors, administrators, estates, heirs and legal successors, or nominees or representatives, of the Member(s) and (b) may be executed in counterparts with the same effect as if the parties executing the several counterparts had all executed one counterpart.

11.5         Interpretation. Wherever from the context it appears appropriate, each term stated in either the singular or the plural shall include the singular and the plural, and pronouns stated in either the masculine, the feminine, or the neuter gender shall include the masculine, feminine and neuter.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, the undersigned has duly executed this Agreement as of the day first above written.

INITIAL MEMBER:
CPI INTERNATIONAL, INC.
By:	/s/ Robert A. Fickett
	Name: Robert A. Fickett
	Title: Authorized Signatory

[Signature Page to Communications & Power Industries LLC Agreement]

Schedule A

Communications & Power Industries LLC

Name and Address of Member(s)	Common Interest Percentage
CPI International, Inc.811 Hansen WayPalo Alto, CA 94303	100	%

A-1

Exhibit A

Initial Board of Managers

Name	Position
O. Joe Caldarelli	Manager
Robert A. Fickett	Manager
Robert B. McKeon	Manager
Hugh D. Evans	Manager
Ramzi M. Musallam	Manager
Jeffrey P. Kelly	Manager

A-1

Exhibit B

Initial Officers

Officer	Title
O. Joe Caldarelli	Chief Executive Officer
Robert A. Fickett	President and Chief Operating Officer
Joel A. Littman	Chief Financial Officer, Treasurer and Secretary
John R. Beighley	Vice President and Assistant Secretary
Don C. Coleman	Vice President
Andrew E. Tafler	Vice President
Hugh D. Evans	Assistant Secretary

B-1

EX-3.16

Exhibit 3.16

CERTIFICATE OF CONVERSION

FROM A CORPORATION

TO LIMITED LIABILITY COMPANY

Pursuant to Sections 18-204 and 18-214 of the

Delaware Limited Liability Company Act

and Section 266 of the

General Corporation Law of the State of Delaware

1.             The name of the Corporation immediately prior to the filing of this Certificate of Conversion is CPI Subsidiary Holdings Inc.  The Corporation was originally incorporated under the same name.

2.             The Corporation was originally incorporated on the 27th day of June, 1995, under the laws of the State of Delaware.  The Corporation’s jurisdiction of incorporation immediately prior to the filing of this Certificate of Conversion is the State of Delaware.

3.             The name of the limited liability company into which the Corporation shall be converted, as set forth in its Certificate of Formation, is CPI Subsidiary Holdings LLC.

4.             The Conversion has been approved in accordance with the provisions of Section 266 of the General Corporation Law of the State of Delaware.

5.             This Certificate of Conversion shall be effective at 8:47 a.m. on February 11, 2011.

[SIGNATURE PAGE FOLLOWS]

IN WITNESS WHEREOF, the Corporation has caused this Certificate of Conversion to be executed in its name this 10th day of February, 2011.

CPI SUBSIDIARY HOLDINGS INC.
By:	/s/ Robert A. Fickett
Name: Robert A. Fickett
Title: Authorized Officer

EX-3.17

Exhibit 3.17

CERTIFICATE OF FORMATION

OF

CPI SUBSIDIARY HOLDINGS LLC

1.                             The name of the limited liability company is CPI Subsidiary Holdings LLC.

2.                             The address of its registered office in the State of Delaware is 615 South DuPont Highway, in the City of Dover, County of Kent.  The name of its registered agent at such address is National Corporate Research, Ltd.

3.                             This Certificate of Formation shall be effective at 8:47 a.m. on February 11, 2011.

IN WITNESS WHEREOF, the undersigned has executed this Certificate of Formation this 10th day of February, 2011.

By:	/s/ Robert A. Fickett
Name: Robert A. Fickett
Title: Authorized Person

EX-3.18

Exhibit 3.18

EXECUTION COPY

LIMITED LIABILITY COMPANY AGREEMENT

OF

CPI SUBSIDIARY HOLDINGS LLC

THIS LIMITED LIABILITY COMPANY AGREEMENT of CPI Subsidiary Holdings LLC (the “Company”), dated as of the 11th day of February, 2011 (this “Agreement”), is made by Communications & Power Industries, Inc., a Delaware corporation, as the initial sole member of the Company (the “Initial Member”), and by and between the Initial Member and/or any person(s) or entity(ies) subsequently admitted as a member or members of the Company in accordance with the terms hereof (the Initial Member and any such person(s) or entity(ies) being sometimes referred to individually as a “Member” and collectively as the “Members”).

RECITAL

The Company was formed as a limited liability company under the laws of the State of Delaware, and the Initial Member desires to enter into a written agreement, in accordance with the provisions of the Delaware Limited Liability Company Act and any successor statute, as amended from time to time (the “Act”), governing the affairs of the Company and the conduct of its business.

ARTICLE I

DEFINITIONS

Capitalized terms used but not otherwise defined herein shall have the meanings assigned to them in the Act.

ARTICLE II

THE LIMITED LIABILITY COMPANY

2.1Formation.  The Company was formed as a limited liability company pursuant to the provisions of the Act.  A certificate of formation for the Company as described in Section 18-201 of the Act (the “Certificate of Formation”) has been filed in the Office of the Secretary of State of the State of Delaware in conformity with the Act.  The Initial Member hereby ratifies

and confirms the authority of Robert A. Fickett as an authorized person within the meaning of Sections 18-201 and 18-204 of the Act to execute the Certificate of Formation and to cause it to be so filed.

2.2Name.  The name of the Company is “ CPI Subsidiary Holdings LLC “ and its business shall be carried on in such name with such variations and changes as the Member(s)from time to time shall determine or deem necessary to comply with requirements of the jurisdictions in which the Company’s operations are conducted.

2.3Business Purpose; Powers.  The Company is formed for the purpose of engaging in any lawful business, purpose or activity for which limited liability companies may be formed under the Act.  The Company shall possess and may exercise all the powers and privileges granted by the Act or by any other law or by this Agreement, together with any powers incidental thereto, so far as such powers and privileges are necessary or convenient to the conduct, promotion or attainment of the business purposes or activities of the Company.

2.4Registered Office and Agent.  The location of the registered office of the Company shall be 615 South DuPont Highway, Dover, Delaware 19901.  The Company’s Registered Agent at such address shall be National Corporate Research, Ltd.

2.5Term.  The term of the Company commenced on the date of the filing of the Certificate of Formation in the Office of the Secretary of State of the State of Delaware.  Subject to the provisions of Article VII below, the Company shall have perpetual existence.

2.6No State Law Partnership.  The Member(s) intend(s) that for state law purposes the Company not be a partnership (including a limited partnership) or joint venture and that no Member be a partner or joint venturer of any other Member for any purpose.  This Agreement may not be construed to suggest otherwise; though, for the avoidance of doubt, this Section 2.6 shall have no bearing on the classification of the Company for U.S. federal income tax purposes.

2.7Fiscal Year.  The fiscal year of the Company for financial statement and federal income tax purposes shall be determined by a Majority of Members (as defined in Section 3.2).

ARTICLE III

MEMBERS

3.1Members.  The name, address and percentage (“Common Interest Percentage”) of all outstanding Common Interests (as hereinafter defined) of the Member(s) is set forth on Schedule A hereto, which shall be amended from time to time to reflect the admission of new Members, additional capital contributions of Members or the Transfer (as hereinafter defined) of Common Interests of any Member.

3.2Admission of New Members.  Additional persons or entities shall be admitted as Members of the Company only upon the approval of the Member or Members holding, in the aggregate, a majority of the outstanding Common Interests (a “Majority of Members”), subject to receipt by the Company of a written agreement (which may take the form of a counterpart of this

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Agreement) executed by such persons or entities proposed to become Members pursuant to which such persons or entities thereby agree to be bound by the terms of this Agreement, at which time such persons or entities shall be bound by this Agreement and admitted as Members.

3.3Actions by Members; Meetings.  A Majority of Members may approve a matter or take any action at a meeting or without a meeting by the written consent of such Majority of Members.  Meetings of Members may be called at any time by a Majority of Members.

3.4No Liability of Members.  All debts, obligations and liabilities of the Company, whether arising in contract, tort or otherwise, shall be solely the debts, obligations and liabilities of the Company, and no Member shall be obligated personally for any such debt, obligation or liability of the Company solely by reason of being a Member.

3.5Power to Bind the Company.  No Member (acting in its capacity as such) shall have any authority to bind the Company to any third party with respect to any matter except by written approval of a Majority of Members that expressly authorizes such matter and authorizes such Member to bind the Company with respect thereto; provided, however, that the Initial Member (acting in its capacity as such) shall have the authority to bind the Company to any third party with respect to any matter until such time as any new Member is admitted pursuant to the terms hereof at which time the foregoing limitation on the power of the Members to bind the Company shall apply to all Members, including the Initial Member.

ARTICLE IV

MANAGEMENT BY MEMBERS

4.1Management by Members.  The management of the Company is fully reserved to the Member(s), and the Company shall not have “managers,” as that term is used in the Act.  The powers of the Company shall be exercised by or under the authority of, and the business and affairs of the Company shall be managed under the direction of, the Member(s), who shall make all decisions and take all actions for the Company.  In managing the business and affairs of the Company and exercising its powers, the Member(s) may act through resolutions adopted in written consents signed by a Majority of Members, or through agreements or other instruments signed by a Majority of Members and reciting or setting forth the approval or consent of a Majority of Members.  Decisions or actions taken by a Majority of Members in accordance with this Agreement shall constitute decisions or action by the Company and shall be binding on the Company.

4.2Officers and Related Persons.  Without limitation of Section 4.1, a Majority of Members shall have the authority to appoint and terminate officers of the Company and retain and terminate employees, agents and consultants of the Company and to delegate such duties to any such officers, employees, agents and consultants as a Majority of Members deem appropriate, including the power, acting individually or jointly, to represent and bind the Company in all matters, in accordance with the scope of their respective duties.  The Initial Member shall have the right to appoint the initial Officers.  The names of the initial Officers are set forth on Exhibit

3

A, as such may be reasonably promptly amended from time to time to reflect any appointment or termination of Officers pursuant to the terms of this Article IV.

ARTICLE V

CAPITAL STRUCTURE AND CONTRIBUTIONS; CAPITAL ACCOUNTS

5.1Capital Structure.  The capital structure of the Company shall consist of one class of common interests (the “Common Interests”).  All Common Interests shall be identical with each other in every respect.

5.2Capital Contributions.  From time to time, the Member(s) may determine that the Company requires capital and may make capital contribution(s) in an amount determined by a Majority of Members.  In accordance with Section 18-301(d) of the Act, the Initial Member and any additional Member may be admitted to the Company as a Member and may receive Common Interests without making a contribution or being obligated to make a contribution to the Company.

5.3Transfer of Common Interest.  A transferee (pursuant to a Transfer in accordance with the terms of this Agreement) of all (or a portion) of a Common Interest will succeed to the Capital Account (or portion of the Capital Account) attributable to the Transferred Common Interest.

ARTICLE VI

PROFITS, LOSSES AND DISTRIBUTIONS

6.1Profits and Losses.  For financial accounting purposes, the Company’s net profits or net losses shall be determined on an annual basis in accordance with the manner determined by a Majority of Members.

6.2Distributions.  A Majority of Members shall determine when cash or other Company assets are available for distribution to the Member(s) in compliance with the Act, and the amount, if any, to be distributed to the Member(s), and shall authorize and distribute on the Common Interests to the Member(s), pro rata in proportion to its (their) respective Common Interest Percentages, the determined amount when, as and if declared by a Majority of Members.

ARTICLE VII

ADMINISTRATIVE PROVISIONS

7.1Accounting Method.  The accounting for purposes of the Company shall be in accordance with accounting principles determined by the Manager.

4

7.2Entity Classification.  For U.S. federal income tax purposes, the Company shall be disregarded as an entity separate from its owner within the meaning of Treasury Regulation §301.7701-3 and shall not make an election to be classified as a corporation.

ARTICLE VIII

EVENTS OF DISSOLUTION OF THE COMPANY

8.1Dissolution.  The Company shall dissolve, and its affairs shall be wound up only upon the first to occur of the following:  (i) the written consent of the Members or (ii) the entry of a decree of judicial dissolution under Section 18-802 of the Act or (iii) at any time there is no member of the Company unless the Company is continued in accordance with the Act.  The Members shall continue to be allocated profit and loss, in the manner set forth in Section 6.1 during the liquidation.  The proceeds from liquidation of Company assets shall be applied as follows:

(1)satisfaction (whether by payment or the making of reasonable provision for payment) of debts of the Company other than to the Members;

(2)to payment of amounts owed to the Members for amounts borrowed from and not repaid to the Members; and

(3)to the Members.

8.2Gains or Losses in Winding-Up.  Any gain or loss on disposition of Company properties in the process of liquidation shall be credited or charged to the Members in the manner set forth in Section 6.1.  Any property distributed in kind in the liquidation of the Company shall be valued and treated as though the property were sold and the cash proceeds were distributed.  The difference between the value of the property distributed in kind and its book value shall be treated as a gain or loss on sale of the property and shall be credited or charged to the Members in the manner set forth in Section 6.1.

8.3Termination.  The Company shall terminate when all of the assets of the Company, after payment of or due provision for all debts, liabilities and obligations of the Company shall have been distributed to the Members in the manner provided for in this Article VIII, and the certificate of formation of the Company in effect as of the date thereof shall have been canceled in the manner required by the Act.

ARTICLE IX

TRANSFER OF INTERESTS IN THE COMPANY

A Member may sell, assign, transfer, convey, gift, exchange or otherwise dispose of (each, a “Transfer”) any or all of its Common Interests and, subject to Section 3.2, upon receipt by the Company of a written agreement (which may take the form of a counterpart of this Agreement) executed by the person or entity to whom such Common Interests are to be

5

Transferred pursuant to which such person or entity thereby agrees to be bound by the terms of this Agreement, such person or entity shall be bound by this Agreement and admitted as a Member.  A Member shall automatically cease to be deemed a Member under this Agreement (an “Exiting Member”) in the event that (i) such Member has Transferred all Common Interests held by such Member, in one or a series of transactions and in accordance with the terms hereof, to other persons or entities and (ii) if one or more of the following is true: (x) at least one transferee of such Transferred Common Interests is already a Member, (y) a Member other than the Exiting Member is in existence or (z) at least one transferee of such Transferred Common Interests has been admitted as a Member pursuant to the preceding sentence.

ARTICLE X

EXCULPATION AND INDEMNIFICATION

10.1Exculpation.  Notwithstanding any other provisions of this Agreement, whether express or implied, or any obligation or duty at law or in equity, neither the Member(s), nor any officers, directors, stockholders, partners, employees, affiliates, representatives or agents of any of the Member(s), nor any officer, employee, representative or agent of the Company(individually, a “Covered Person” and, collectively, the “Covered Persons”), shall be liable to the Company or any other person for any act or omission (in relation to the Company, its property or the conduct of its business or affairs, this Agreement, any related document or any transaction or investment contemplated hereby or thereby) taken or omitted by a Covered Person in the reasonable belief that such act or omission is in or is not contrary to the best interests of the Company and is within the scope of authority granted to such Covered Person by the Agreement, provided such act or omission does not constitute fraud, willful misconduct, bad faith, or gross negligence.

10.2Indemnification.  To the fullest extent permitted by law, the Company shall indemnify and hold harmless each Covered Person from and against any and all losses, claims, demands, liabilities, expenses, judgments, fines, settlements and other amounts arising from any and all claims, demands, actions, suits or proceedings, civil, criminal, administrative or investigative (“Claims”), in which the Covered Person may be involved, or threatened to be involved, as a party or otherwise, by reason of its management of the affairs of the Company or which relates to or arises out of the Company or its property, business or affairs.  A Covered Person shall not be entitled to indemnification under this Section 9.2 with respect to (i) any Claim with respect to which such Covered Person has engaged in fraud, willful misconduct, bad faith or gross negligence or (ii) any Claim initiated by such Covered Person unless such Claim (or part thereof) (A) was brought to enforce such Covered Person’s rights to indemnification hereunder or (B) was authorized or consented to by a Majority of Members.  Expenses incurred by a Covered Person in defending any Claim shall be paid by the Company in advance of the final disposition of such Claim upon receipt by the Company of an undertaking by or on behalf of such Covered Person to repay such amount if it shall be ultimately determined that such Covered Person is not entitled to be indemnified by the Company as authorized by this Section 9.2.

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10.3Amendments.  Any repeal or modification of this Article IX pursuant to Section 10.2 hereof shall not adversely affect any rights of such Covered Person pursuant to this Article IX, including the right to indemnification and to the advancement of expenses of a Covered Person existing at the time of such repeal or modification with respect to any acts or omissions occurring prior to such repeal or modification.

ARTICLE XI

MISCELLANEOUS

11.1Amendments.  Except as otherwise provided in this Agreement, amendments to this Agreement and to the Certificate of Formation shall be approved in writing by a Majority of Members.  An amendment shall become effective as of the date specified in the approval of a Majority of Members, or if none is specified, as of the date of such approval or as otherwise provided in the Act.

11.2Severability.  If any provision of this Agreement is held to be invalid or unenforceable for any reason, such provision shall be ineffective to the extent of such invalidity or unenforceability; provided, however, that the remaining provisions will continue in full force without being impaired or invalidated in any way unless such invalid or unenforceable provisionor clause shall be so significant as to materially affect the expectations of the Member(s) regarding this Agreement.  Otherwise, any invalid or unenforceable provision shall be replaced by a Majority of Members with a valid provision which most closely approximates the intent and economic effect of the invalid or unenforceable provision.

11.3Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware without regard to the principles of conflicts of laws thereof.  In particular, this Agreement shall be construed to the maximum extent possible to comply with all the terms and conditions of the Act.

11.4Successors; Counterparts.  Subject to Section 3.2 and Article VIII, this Agreement (a) shall be binding as to the executors, administrators, estates, heirs and legal successors, or nominees or representatives, of the Member(s) and (b) may be executed in counterparts with the same effect as if the parties executing the several counterparts had all executed one counterpart.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

[SIGNATURE PAGE FOLLOWS]

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IN WITNESS WHEREOF, the undersigned has duly executed this Agreement as of the day first above written.

INITIAL MEMBER:
COMMUNICATIONS & POWER INDUSTRIES, INC.
By:	/s/ Robert A. Fickett
	Name:Robert A. Fickett
	Title:Authorized Signatory

[Signature Page to CPI Subsidiary Holdings LLC Agreement]

Schedule A

CPI Subsidiary Holdings LLC

Name and Address of Member(s)	Common Interest Percentage
Communications & Power Industries, Inc. 811 Hansen Way Palo Alto, CA 94303	100	%

A-1

Exhibit A

Initial Officers

Officer	Title
Robert A. Fickett	President & Treasurer
Joel A. Littman	Secretary

A-1

EX-4.1

Exhibit 4.1

CPI INTERNATIONAL ACQUISITION, INC.
(to be renamed CPI INTERNATIONAL, INC.)
as Issuer,

CPI INTERNATIONAL HOLDING CORP.,
as Guarantor
and the other Guarantors that become party hereto from time to time,

and

The Bank of New York Mellon Trust Company, N.A.,
as Trustee

INDENTURE

Dated as of February 11, 2011

8.00% Senior Notes due 2018

CROSS-REFERENCE TABLE

Trust Indenture Act Section		Indenture Section
310 (a)(1)		7.10
	(a)(2)	7.10
	(a)(3)	N.A.
	(a)(4)	N.A.
	(a)(5)	7.08; 7.10
	(b)	7.08; 7.10; 12.02
	(c)	N.A.
311 (a)		7.11
	(b)	7.11
	(c)	N.A.
312 (a)		2.05
	(b)	12.03
	(c)	12.03
313 (a)		7.06
	(b)(1)	7.06
	(b)(2)	7.06
	(c)	7.06; 12.02
	(d)	7.06
314 (a)		4.06; 4.18; 12.02
	(b)	N.A.
	(c)(1)	7.02; 12.04; 12.05
	(c)(2)	7.02; 12.04; 12.05
	(c)(3)	N.A.
	(d)	N.A.
	(e)	12.05
	(f)	N.A.
315 (a)		7.01(b); 7.02(a)
	(b)	7.05; 12.02
	(c)	7.01
	(d)	6.05; 7.01(c)
	(e)	6.11
316 (a)(last sentence)		2.09
	(a)(1)(A)	6.05
	(a)(1)(B)	6.04
	(a)(2)	9.02
	(b)	6.07
	(c)	9.05
317 (a)(1)		6.08
	(a)(2)	6.09
	(b)	2.04
318 (a)		12.01
	(c)	12.01

N.A. means Not Applicable

Note:This Cross-Reference Table shall not, for any purpose, be deemed to be a part of this Indenture.

TABLE OF CONTENTS

		Page
ARTICLE One
DEFINITIONS AND INCORPORATION BY REFERENCE
SECTION 1.01.	Definitions	1
SECTION 1.02.	Other Definitions	22
SECTION 1.03.	Incorporation by Reference of Trust Indenture Act	23
SECTION 1.04.	Rules of Construction	23
ARTICLE Two
THE NOTES
SECTION 2.01.	Form and Dating	24
SECTION 2.02.	Execution, Authentication and Denomination; Additional Notes; Exchange Notes	25
SECTION 2.03.	Registrar and Paying Agent	26
SECTION 2.04.	Paying Agent To Hold Assets in Trust	26
SECTION 2.05.	Holder Lists	26
SECTION 2.06.	Transfer and Exchange	26
SECTION 2.07.	Replacement Notes	27
SECTION 2.08.	Outstanding Notes	27
SECTION 2.09.	Treasury Notes	27
SECTION 2.10.	Temporary Notes	28
SECTION 2.11.	Cancellation	28
SECTION 2.12.	Defaulted Interest	28
SECTION 2.13.	CUSIP and ISIN Numbers	28
SECTION 2.14.	Deposit of Moneys	28
SECTION 2.15.	Book-Entry Provisions for Global Notes	28
SECTION 2.16.	Special Transfer and Exchange Provisions	29
ARTICLE Three
REDEMPTION
SECTION 3.01.	Notices to Trustee	32
SECTION 3.02.	Selection of Notes To Be Redeemed	32
SECTION 3.03.	Notice of Redemption	33
SECTION 3.04.	Effect of Notice of Redemption	33
SECTION 3.05.	Deposit of Redemption Price	34
SECTION 3.06.	Notes Redeemed in Part	34
ARTICLE Four
COVENANTS
SECTION 4.01.	Payment of Notes	34
SECTION 4.02.	Maintenance of Office or Agency	34
SECTION 4.03.	Corporate Existence	35
SECTION 4.04.	Payment of Taxes	35
SECTION 4.05.	Suspension of Covenants	35

i

		Page
SECTION 4.06.	Compliance Certificate; Notice of Default	36
SECTION 4.07.	Business Activities	36
SECTION 4.08.	Waiver of Stay, Extension or Usury Laws	36
SECTION 4.09.	Change of Control	36
SECTION 4.10.	Limitations on Additional Indebtedness	38
SECTION 4.11.	Limitations on Restricted Payments	40
SECTION 4.12.	Limitations on Liens	41
SECTION 4.13.	Limitations on Asset Sales	42
SECTION 4.14.	Limitations on Transactions with Affiliates	45
SECTION 4.15.	Limitations on Dividend and Other Restrictions Affecting Restricted Subsidiaries	46
SECTION 4.16.	Additional Note Guarantees	47
SECTION 4.17.	Limitation on Layering Indebtedness	48
SECTION 4.18.	Reports to Holders	48
SECTION 4.19.	Limitations on Designation of Unrestricted Subsidiaries	49
SECTION 4.20.	Additional Interest Notice	50
ARTICLE Five
SUCCESSOR CORPORATION
SECTION 5.01.	Mergers, Consolidations, Etc	50
ARTICLE Six
DEFAULT AND REMEDIES
SECTION 6.01.	Events of Default	52
SECTION 6.02.	Acceleration	53
SECTION 6.03.	Other Remedies	54
SECTION 6.04.	Waiver of Past Defaults	54
SECTION 6.05.	Control by Majority	54
SECTION 6.06.	Limitation on Suits	54
SECTION 6.07.	Rights of Holders To Receive Payment	55
SECTION 6.08.	Collection Suit by Trustee	55
SECTION 6.09.	Trustee May File Proofs of Claim	55
SECTION 6.10.	Priorities	55
SECTION 6.11.	Undertaking for Costs	55
ARTICLE Seven
TRUSTEE
SECTION 7.01.	Duties of Trustee	56
SECTION 7.02.	Rights of Trustee	57
SECTION 7.03.	Individual Rights of Trustee	58
SECTION 7.04.	Trustee’s Disclaimer	58
SECTION 7.05.	Notice of Default	58
SECTION 7.06.	Reports by Trustee to Holders	58
SECTION 7.07.	Compensation and Indemnity	58
SECTION 7.08.	Replacement of Trustee	59
SECTION 7.09.	Successor Trustee by Merger, Etc	60
SECTION 7.10.	Eligibility; Disqualification	60
SECTION 7.11.	Preferential Collection of Claims Against the Issuer	60

ii

		Page
ARTICLE Eight
DISCHARGE OF INDENTURE; DEFEASANCE
SECTION 8.01.	Termination of the Issuer’s Obligations	60
SECTION 8.02.	Legal Defeasance and Covenant Defeasance	61
SECTION 8.03.	Conditions to Legal Defeasance or Covenant Defeasance	62
SECTION 8.04.	Application of Trust Money	63
SECTION 8.05.	Repayment to the Issuer	63
SECTION 8.06.	Reinstatement	63
ARTICLE Nine
AMENDMENTS, SUPPLEMENTS AND WAIVERS
SECTION 9.01.	Without Consent of Holders	64
SECTION 9.02.	With Consent of Holders	64
SECTION 9.03.	[Reserved]	65
SECTION 9.04.	Compliance with the Trust Indenture Act	65
SECTION 9.05.	Revocation and Effect of Consents	66
SECTION 9.06.	Notation on or Exchange of Notes	66
SECTION 9.07.	Trustee To Sign Amendments, Etc	66
ARTICLE Ten
[RESERVED]
ARTICLE Eleven
NOTE GUARANTEE
SECTION 11.01.	Guarantee	67
SECTION 11.02.	[Reserved]	67
SECTION 11.03.	Limitation on Guarantor Liability	67
SECTION 11.04.	[Reserved]	68
SECTION 11.05.	Release of a Subsidiary Guarantor; Release of Parent	68
ARTICLE Twelve
MISCELLANEOUS
SECTION 12.01.	Trust Indenture Act Controls	68
SECTION 12.02.	Notices	69
SECTION 12.03.	Communications by Holders with Other Holders	70
SECTION 12.04.	Certificate and Opinion as to Conditions Precedent	70
SECTION 12.05.	Statements Required in Certificate or Opinion	70
SECTION 12.06.	Rules by Paying Agent or Registrar	70
SECTION 12.07.	Legal Holidays	70
SECTION 12.08.	Governing Law	70
SECTION 12.09.	No Adverse Interpretation of Other Agreements	71
SECTION 12.10.	No Recourse Against Others	71
SECTION 12.11.	Successors	71
SECTION 12.12.	Duplicate Originals	71
SECTION 12.13.	Severability	71

iii

		Page
SECTION 12.14.	Waiver of Jury Trial	71
SECTION 12.15.	Force Majeure	71
Signatures		S-1

Exhibit A	–	Form of Note
Exhibit B	–	Form of Legends
Exhibit C	–	Form of Certificate To Be Delivered in Connection with Transfers to Non-QIB Accredited Investors
Exhibit D	–	Form of Certificate To Be Delivered in Connection with Transfers Pursuant to Regulation S
Exhibit E	–	Form of Certificate To Be Delivered in Connection with Transfers of Temporary Regulation S Global Note

Note:This Table of Contents shall not, for any purpose, be deemed to be part of this Indenture.

iv

INDENTURE dated as of February 11, 2011 among CPI International Acquisition, Inc. (to be renamed CPI International, Inc.), a Delaware corporation (the “Issuer”), CPI INTERNATIONAL HOLDING CORP., as Guarantor and the other Guarantors that become party hereto from time to time, and The Bank of New York Mellon Trust Company, N.A., a national banking association organized and existing under the laws of the United States of America, as Trustee (the “Trustee”).

The Issuer has duly authorized the creation of an issue of 8.00% Senior Notes due 2018 and, to provide therefor, the Issuer and the Guarantors have duly authorized the execution and delivery of this Indenture.  All things necessary to make the Notes, when duly issued and executed by the Issuer and authenticated and delivered hereunder, the valid and binding obligations of the Issuer and to make this Indenture a valid and binding agreement of the Issuer and the Guarantors has been done.

THIS INDENTURE WITNESSETH

For and in consideration of the premises and the purchase of the Notes by the Holders thereof, the parties hereto covenant and agree, for the equal and proportionate benefit of all Holders, as follows:

ARTICLE ONE

DEFINITIONS AND INCORPORATION BY REFERENCE

SECTION 1.01.Definitions.

Set forth below are certain defined terms used in this Indenture.

“8% Senior Subordinated Notes” means Communications & Power Industries, Inc.’s 8.00% Senior Subordinated Notes due 2012 outstanding on the Issue Date.

“Acquired Indebtedness” means (1) with respect to any Person that becomes a Restricted Subsidiary after the Issue Date, Indebtedness of such Person and its Subsidiaries existing at the time such Person becomes a Restricted Subsidiary that was not incurred in connection with, or in contemplation of, such Person becoming a Restricted Subsidiary and (2) with respect to the Issuer or any Restricted Subsidiary, any Indebtedness of a Person (other than the Issuer or a Restricted Subsidiary) existing at the time such Person is merged with or into the Issuer or a Restricted Subsidiary, or Indebtedness expressly assumed by the Issuer or any Restricted Subsidiary in connection with the acquisition of an asset or assets from another Person, which Indebtedness was not, in any case, incurred by such other Person in connection with, or in contemplation of, such merger or acquisition.

“Additional Interest” has the meaning set forth in the Registration Rights Agreement.

“Advisory Agreement” means that certain Advisory Agreement, dated as of the Issue Date, between the Issuer and the Sponsor.

“Affiliate” of any Person means any other Person which directly or indirectly controls or is controlled by, or is under direct or indirect common control with, the referent Person.  For purposes of this definition, “control” of a Person shall mean the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise.

“Agent” means any Registrar or Paying Agent.

“amend” means to amend, supplement, restate, amend and restate or otherwise modify, including successively; and “amendment” shall have a correlative meaning.

“Applicable Premium” means, with respect to a Note at any Redemption Date, the greater of:  (i) 1.0% of the principal amount of such Note; and (ii) the excess, if any, of:  (A) the present value at such Redemption Date of (1) the redemption price of such Note on February 15, 2015 (such redemption price being that set forth in Section

5(a) of the Notes) plus (2) all required remaining scheduled interest payments due on such Note through February 15, 2015, computed using a discount rate equal to the Treasury Rate on such Redemption Date plus 50 basis points per annum, over (B) the principal amount of such Note.

Calculation of the Applicable Premium will be made by the Issuer or on behalf of the Issuer by such Person as the Issuer shall designate; provided, however, that such calculation shall not be a duty or obligation of the Trustee.

“asset” means any asset or property.

“Asset Sale” means (1) any sale, conveyance, transfer, lease, assignment or other disposition by the Issuer or any Restricted Subsidiary to any Person (including by means of a Sale and Leaseback Transaction or a merger or consolidation) (collectively, for purposes of this definition, a “transfer”), in one transaction or a series of related transactions, of any assets of the Issuer or any of its Restricted Subsidiaries other than in the ordinary course of business, or (2) the issuance or sale of Equity Interests of any Restricted Subsidiary, whether in one transaction or a series of related transactions.  For purposes of this definition, the term “Asset Sale” shall not include:

(1)transfers of cash or Cash Equivalents;

(2)transfers of assets (including Equity Interests) that are governed by, and made in accordance with Section 5.01 or any such transfer that constitutes a Change of Control pursuant to this Indenture;

(3)Permitted Investments and Restricted Payments permitted under Section 4.11;

(4)the creation of or realization on any Permitted Lien;

(5)transfers of damaged, worn-out or obsolete equipment or assets or transfers of inventories or goods (or other assets) that, in the Issuer’s reasonable judgment, are no longer used or useful in the business of the Issuer or its Restricted Subsidiaries;

(6)any transfer or series of related transfers that, but for this clause, would be Asset Sales, if after giving effect to such transfers, the aggregate Fair Market Value of the assets transferred in such transaction or any such series of related transactions does not exceed $10.0 million;

(7)any transfer of assets by the Issuer or a Restricted Subsidiary, or the issuance of securities by a Restricted Subsidiary, in either case, to the Issuer or another Restricted Subsidiary;

(8)any foreclosures, condemnation or similar action with respect to any asset; and

(9)any issuance or sale of Equity Interests in, or Indebtedness or other securities of, an Unrestricted Subsidiary.

“Attributable Indebtedness”, when used with respect to any Sale and Leaseback Transaction, means, as at the time of determination, the present value (discounted at a rate borne by the Notes, compounded on a semi-annual basis) of the total obligations of the lessee for net rental payments during the remaining term of the lease included in any such Sale and Leaseback Transaction.

“Bankruptcy Law” means Title 11 of the United States Code, as amended, or any similar federal or state law for the relief of debtors.

“Board of Directors” means, with respect to any Person, (i) in the case of any corporation, the board of directors of such Person, (ii) in the case of any limited liability company, the board of managers or the managing member of such Person, (iii) in the case of any partnership, the Board of Directors of the general partner of such Person and (iv) in any other case, the functional equivalent of the foregoing.

2

“Business Day” means a day other than a Saturday, Sunday or other day on which banking institutions in New York are authorized or required by law to close.

“Capital Stock” means:

(1)in the case of a corporation, corporate stock;

(2)in the case of an association or business entity, any and all shares, interests, participations, rights or other equivalents (however designated) of corporate stock;

(3)in the case of a partnership or limited liability company, partnership interests (whether general or limited) or membership interests; and

(4)any other interest or participation that confers on a Person the right to receive a share of the profits and losses of, or distributions of assets of, the issuing Person;

but excluding from all of the foregoing any debt securities convertible into Capital Stock, whether or not such debt securities include any right of participation with Capital Stock.

“Capitalized Lease” means a lease required to be capitalized for financial reporting purposes in accordance with GAAP.

“Capitalized Lease Obligations” of any Person means the obligations of such Person to pay rent or other amounts under a Capitalized Lease, and the amount of such obligation shall be the capitalized amount thereof determined in accordance with GAAP.

“Cash Equivalents” means:

(1)obligations with a maturity of 13 months or less from the date of determination issued or directly and fully guaranteed or insured by the United States of America or any agency or instrumentality thereof (provided that the full faith and credit of the United States of America is pledged in support thereof);

(2)demand and time deposits and certificates of deposit or acceptances with a maturity of not more than one year of any financial institution that is a member of the Federal Reserve System having combined capital and surplus and undivided profits of not less than $500.0 million and is assigned at least a “B” rating by Thomson Financial BankWatch;

(3)commercial paper maturing no more than 13 months from the date of determination thereof issued by a corporation that is not the Issuer or an Affiliate of the Issuer, and is organized under the laws of any State of the United States of America or the District of Columbia and rated at least A-2 by S&P or at least P-2 by Moody’s;

(4)repurchase obligations with a term of not more than 90 days for underlying securities of the types described in clause (1) above entered into with any commercial bank meeting the specifications of clause (2) above;

(5)investments in money market or other mutual funds at least 90% of whose assets comprise securities of the types described in clauses (1) through (4) above; and

(6)in the case of Investments by any Restricted Subsidiary that is a Foreign Subsidiary, (x) such local currencies in those countries in which such Foreign Subsidiary transacts business from time to time in the ordinary course of business and (y) Investments of comparable tenor and credit quality to those described in the foregoing clauses (1) through (5) customarily utilized in countries in which such Foreign Subsidiary operates for short-term cash management purposes.

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“CFC” means a controlled foreign corporation within the meaning of the U.S. Internal Revenue Code.

“Change of Control” means the occurrence of any of the following events:

(1)any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act, other than one or more Permitted Holders, is or becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act, except that for purposes of this clause that person or group shall be deemed to have “beneficial ownership” of all securities that any such person or group has the right to acquire, whether such right is exercisable immediately or only after the passage of time), directly or indirectly, of Voting Stock representing 50% or more of the voting power of the total outstanding Voting Stock of the Issuer;

(2)during any period of two consecutive years commencing after the Issue Date, individuals who at the beginning of such period constituted the Board of Directors (together with any new directors whose election to such Board of Directors or whose nomination for election by the stockholders of the Issuer was approved by a vote of the majority of the directors of the Issuer then still in office who were either directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the Board of Directors of the Issuer; or

(3)(a) all or substantially all of the assets of the Issuer and the Restricted Subsidiaries are sold or otherwise transferred to any Person other than a Wholly-Owned Restricted Subsidiary or one or more Permitted Holders or (b) the Issuer consolidates or merges with or into another Person or any Person consolidates or merges with or into the Issuer, in either case under this clause (3), in one transaction or a series of related transactions in which immediately after the consummation thereof Persons beneficially owning (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, Voting Stock representing in the aggregate a majority of the total voting power of the Voting Stock of the Issuer immediately prior to such consummation, together with the Permitted Holders, do not beneficially own (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, Voting Stock representing a majority of the total voting power of the Voting Stock of the Issuer or the surviving or transferee Person.

“Consolidated Amortization Expense” for any period means the amortization expense of the Issuer and the Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP.

“Consolidated Cash Flow” for any period means, without duplication, the sum of the amounts for such period of

(1)Consolidated Net Income, plus

(2)in each case only to the extent (and in the same proportion) deducted in determining Consolidated Net Income,

(a)Consolidated Income Tax Expense;

(b)Consolidated Amortization Expense (but only to the extent not included in Consolidated Interest Expense);

(c)Consolidated Depreciation Expense;

(d)Consolidated Interest Expense;

(e)Restructuring Expenses;

(f)to the extent permitted to be made pursuant to Section 4.14(b)(9), any management, consulting, monitoring, advisory or termination fees and expenses or any transaction fees and expenses paid or accrued for payment to Sponsor or any of its Affiliates;

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(g)any fees, expenses, costs or charges or any amortization thereof, related to any Subject Transaction (in each case including any such transaction undertaken but not completed) and any amendment or modification of any such Subject Transaction;

(h)the amount of any minority interest expense consisting of income of a Subsidiary Guarantor attributable to minority Equity Interests of third parties in any Subsidiary Guarantor that is not a Wholly-Owned Restricted Subsidiary;

(i)expenses, costs or charges or any amortization thereof that results from accruals and reserves (other than fees, expenses, costs or charges relating to the Transactions) that are established within twelve months after the Issue Date that are so required to be established as a result of the Transactions in accordance with GAAP;

(j)cash receipts (or any netting arrangements resulting in reduced cash expenditures) not representing Consolidated Net Income in any period to the extent non-cash gains relating to such income were deducted in the calculation of Consolidated Cash Flow pursuant to clause (3) below for any previous period and not added back;

(k)the amount of net cost savings projected by the Issuer in good faith to be realized as a result of specified actions taken or initiated in connection with a Subject Transaction during or prior to such period (calculated on a pro forma basis as though such cost savings had been realized on the first day of such period), net of the amount of actual benefits realized during such period from such actions; provided that (x) such cost savings are reasonably identifiable and factually supportable, (y) no such cost savings may be realized more than 12 months following the Subject Transaction and (z) the aggregate amount of cost savings added pursuant to this clause (k) shall not exceed, for any Four-Quarter Period, 15% of Consolidated Cash Flow for such period before giving effect to this clause (k), with such pro forma adjustments to Consolidated Cash Flow as are appropriate and consistent with the pro forma adjustment provision set forth in the definition of “Consolidated Interest Coverage Ratio”; and

(l)all other non-cash items reducing the Consolidated Net Income (excluding (x) any non-cash charge that results in an accrual of a reserve for cash charges in any future period and (y) any write-offs or write-downs of inventory or accounts receivable (other than any write-off or write-down of inventory or accounts receivable in connection with an acquisition that includes the acquisition of such inventory or accounts receivable) for such period,

in each case determined on a consolidated basis in accordance with GAAP, reduced (without duplication) by the following, in each case to the extent included in determining Consolidated Net Income for such period:

(3)(a) the aggregate amount of all non-cash items (excluding any item which represents the reversal of any accrual of, or cash reserve for, anticipated cash charges in any period), determined on a consolidated basis, to the extent such items increased Consolidated Net Income for such period; and

(b)the amount of any minority interest income consisting of Subsidiary Guarantor losses attributable to minority Equity Interests of third parties in any Subsidiary Guarantor that is not a Wholly-Owned Restricted Subsidiary.

“Consolidated Depreciation Expense” for any period means the depreciation expense of the Issuer and the Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP.

“Consolidated Income Tax Expense” for any period means the provision for taxes of the Issuer and the Restricted Subsidiaries, determined on a consolidated basis in accordance with GAAP.

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“Consolidated Interest Coverage Ratio” means the ratio of Consolidated Cash Flow during the most recent four consecutive full fiscal quarters for which financial statements are available (the “Four-Quarter Period”) ending on or prior to the date of the transaction giving rise to the need to calculate the Consolidated Interest Coverage Ratio (the “Transaction Date”) to Consolidated Interest Expense for the Four-Quarter Period.  For purposes of this definition, “Consolidated Cash Flow” and “Consolidated Interest Expense” shall be calculated after giving effect on a pro forma basis for the period of such calculation to:

(1)the incurrence of any Indebtedness or the issuance of any Preferred Stock of the Issuer or any Restricted Subsidiary (and the application of the proceeds thereof) and any repayment of other Indebtedness or redemption of other Preferred Stock (and the application of the proceeds therefrom) (other than the incurrence or repayment of Indebtedness in the ordinary course of business for working capital purposes pursuant to any revolving credit arrangement) occurring during the Four-Quarter Period or at any time subsequent to the last day of the Four-Quarter Period and on or prior to the Transaction Date, as if such incurrence, repayment, issuance or redemption, as the case may be (and the application of the proceeds thereof), occurred on the first day of the Four-Quarter Period; and

(2)any Investment, acquisition, disposition, merger, consolidation or disposed operation (as determined in accordance with GAAP) (including, without limitation, any acquisition giving rise to the need to make such calculation as a result of the Issuer or any Restricted Subsidiary (including any Person who becomes a Restricted Subsidiary as a result of such acquisition) incurring Acquired Indebtedness and also including any Consolidated Cash Flow (including any pro forma expense and cost reductions calculated on a basis consistent with Regulation S-X under the Exchange Act) associated with any such acquisition) occurring during the Four-Quarter Period or at any time subsequent to the last day of the Four-Quarter Period and on or prior to the Transaction Date, as if such Investment, acquisition, disposition, merger, consolidation or disposed operation (including the incurrence of, or assumption or liability for, any such Acquired Indebtedness) occurred on the first day of the Four-Quarter Period.  If since the beginning of such Four-Quarter Period any Person that subsequently became a Restricted Subsidiary or was merged with or into the Issuer or any of its Restricted Subsidiaries since the beginning of such period shall have made any Investment, acquisition, disposition, merger, consolidation or disposed operation that would have required adjustment pursuant to this definition, then the Consolidated Interest Coverage Ratio shall be calculated giving pro forma effect thereto for such period as if such Investment, acquisition, disposition, merger, consolidation or disposed operation had occurred at the beginning of the applicable Four-Quarter Period.

If the Issuer or any Restricted Subsidiary directly or indirectly guarantees Indebtedness of a third Person, the preceding sentence shall give effect to the incurrence of such guaranteed Indebtedness as if the Issuer or such Restricted Subsidiary had directly incurred or otherwise assumed such guaranteed Indebtedness.

For purposes of calculating the Consolidated Interest Coverage Ratio prior to the expiration of the first Four-Quarter Period subsequent to the Issue Date, such calculation shall be on the same pro forma basis as the pro forma financial statements that are presented in the Offering Memorandum.

In calculating Consolidated Interest Expense for purposes of determining the denominator (but not the numerator) of this Consolidated Interest Coverage Ratio:

(1)interest on outstanding Indebtedness determined on a fluctuating basis as of the Transaction Date and which will continue to be so determined thereafter shall be deemed to have accrued at a fixed rate per annum equal to the rate of interest on this Indebtedness in effect on the Transaction Date;

(2)if interest on any Indebtedness actually incurred on the Transaction Date may optionally be determined at an interest rate based upon a factor of a prime or similar rate, a eurocurrency interbank offered rate, or other rates, then the interest rate in effect on the Transaction Date will be deemed to have been in effect during the Four-Quarter Period; and

(3)notwithstanding clause (1) or (2) above, interest on Indebtedness determined on a fluctuating basis, to the extent such interest is covered by agreements relating to Hedging Obligations, shall be deemed to accrue at the rate per annum resulting after giving effect to the operation of these agreements.

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“Consolidated Interest Expense” for any period means the sum, without duplication, of the total interest expense minus the interest income of the Issuer and the Restricted Subsidiaries for such period, determined on a consolidated basis in accordance with GAAP and including without duplication,

(1)imputed interest on Capitalized Lease Obligations and Attributable Indebtedness,

(2)commissions, discounts and other fees and charges owed to Persons other than the Issuer or any Restricted Subsidiary with respect to letters of credit securing financial obligations, bankers’ acceptance financing and receivables financings,

(3)the net costs associated with Hedging Obligations,

(4)amortization of debt issuance costs and original issue discount resulting from the issuance of Indebtedness at less than par,

(5)the interest portion of any deferred payment obligations,

(6)all other non-cash interest expense (but excluding any non-cash interest expense attributable to the movement in the mark to market valuation of Hedging Obligations or other derivative instruments pursuant to GAAP),

(7)capitalized interest, and

(8)all cash dividend payments on any series of Disqualified Equity Interests of the Issuer or any Preferred Stock of any Restricted Subsidiary (other than any such Disqualified Equity Interests or any Preferred Stock held by the Issuer or a Wholly-Owned Restricted Subsidiary or to the extent paid in Qualified Equity Interests).

Notwithstanding the preceding, all such amounts relating to the 8% Senior Subordinated Notes and the Floating Rate Notes to be purchased or redeemed in connection with the Transactions and the amortization of debt issuance costs, debt discount or premium and other financing fees and expenses incurred in connection with the Transactions shall be excluded in the calculation of Consolidated Interest Expense to the extent otherwise included therein.

Consolidated Interest Expense shall be calculated after giving effect to Hedging Obligations (including associated costs) but excluding unrealized gains and losses with respect to Hedging Obligations.

“Consolidated Net Income” for any period means the net income (or loss) of the Issuer and the Restricted Subsidiaries for such period determined on a consolidated basis in accordance with GAAP; provided that there shall be excluded from such net income (to the extent otherwise included therein), without duplication:

(1)the net income (or loss) of any Person (other than a Restricted Subsidiary) in which any Person other than the Issuer and the Restricted Subsidiaries has an ownership interest, except to the extent that cash in an amount equal to any such income has actually been received by the Issuer or (subject to clause (3) of this definition) any of its Restricted Subsidiaries during such period;

(2)solely for purposes of calculating the Restricted Payments Basket, except to the extent includible in the consolidated net income of the Issuer pursuant to the foregoing clause (1), the net income (or loss) of any Person that accrued prior to the date that (a) such Person becomes a Restricted Subsidiary or is merged into or consolidated with the Issuer or any Restricted Subsidiary or (b) the assets of such Person are acquired by the Issuer or any Restricted Subsidiary;

(3)solely for purposes of calculating the Restricted Payments Basket, the net income of any Restricted Subsidiary during such period to the extent that the declaration or payment of dividends or similar distributions by such Restricted Subsidiary of that income is not permitted by operation of the terms of its charter or any agreement, instrument, judgment, decree, order, statute, rule or governmental regulation

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applicable to that Subsidiary during such period, except that the Consolidated Net Income of the Issuer will be increased by the amount of dividends or other distributions or other payments actually paid in cash (or to the extent converted into cash) to the Issuer or a Restricted Subsidiary by such Restricted Subsidiary, to the extent not already included therein;

(4)other than for purposes of calculating the Restricted Payments Basket, any gain (or loss), together with any related provisions for taxes on any such gain (or the tax effect of any such loss), realized during such period by the Issuer or any Restricted Subsidiary upon (a) the acquisition of any securities, or the extinguishment of any Indebtedness, of the Issuer or any Restricted Subsidiary or (b) any Asset Sale or other asset disposition or abandonment (other than in the ordinary course of business) and reserves relating thereto by the Issuer or any Restricted Subsidiary;

(5)purchase accounting adjustments attributable to any acquisition, including the Transactions, including write-offs of acquired in-process research and development, amortization of inventory write-ups and amortization of acquisition-related intangibles, net of taxes;

(6)gains and losses due solely to fluctuations in currency values and the related tax effects according to GAAP;

(7)net unrealized gains and losses with respect to Hedging Obligations;

(8)the cumulative effect of a change in accounting principles under GAAP;

(9)any payments made in connection with the consummation of the Transactions as described in the Offering Memorandum;

(10)any extraordinary gain or loss and, other than for purposes of calculating the Restricted Payments Basket, any nonrecurring or unusual gains, losses, expenses or charges, together, as applicable, with any related provision for taxes on any such extraordinary or nonrecurring or unusual gain (or the tax effect of any such extraordinary or nonrecurring or unusual losses, expenses or charges), realized by the Issuer or any Restricted Subsidiary during such period;

(11)any gains (or losses) resulting from the return of surplus assets of any benefit plan; and

(12)any net after-tax gains or losses from discontinued operations or the disposal of disposed, abandoned or discontinued operations.

In addition:

(a)Consolidated Net Income shall be reduced by (without duplication) the amount of any payments to or on behalf of Parent made pursuant to Section 4.14(b)(4); and

(b)any return of capital with respect to an Investment that increased the Restricted Payments Basket pursuant to Section 4.11(a)(3)(d) or decreased the amount of Investments outstanding pursuant to the last sentence of the definition of “Investments” shall be excluded from Consolidated Net Income for purposes of calculating the Restricted Payments Basket.

“Consolidated Secured Debt Ratio” means, as of the date of determination, the ratio of (1) the aggregate principal amount of Indebtedness of the Issuer and the Restricted Subsidiaries of the type described in (a) clause (1), (2) (6) or (9) of the definition of “Indebtedness,” or (b) clause (7) or (8) of the definition of “Indebtedness” (to the extent the Indebtedness secured or guaranteed is of the type described in the preceding clause (a)), in each case, that is secured by any Lien as of the end of the most recent fiscal quarter for which financial statements are available ending on or prior to the date of the transaction giving rise to the need to calculate the Consolidated Secured Debt Ratio to (2) the Issuer’s Consolidated Cash Flow for the Four-Quarter Period ending on or prior to the date of the transaction giving rise to the need to calculate the Consolidated Secured Debt Ratio, in each case, with such pro

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forma adjustments to such Indebtedness and Consolidated Cash Flow as are appropriate and consistent with the pro forma adjustment provision set forth in the definition of “Consolidated Interest Coverage Ratio.”

“Corporate Trust Office” means the corporate trust office of the Trustee located at [700 S. Flower Street, Suite 500 Los Angeles, California, 90017, Attention:  Corporate Trust Department], or such other office, designated by the Trustee by written notice to the Issuer, at which at any particular time its corporate trust business shall be administered.

“Coverage Ratio Exception” has the meaning set forth in Section 4.10(a).

“Credit Agreement” means the Credit Agreement dated on or about the Issue Date by and among the Issuer, as Borrower, UBS AG, Stamford Branch, as administrative agent and collateral agent and the lenders party thereto, including any notes, guarantees, collateral and security documents, instruments and agreements executed in connection therewith (including Hedging Obligations related to the Indebtedness incurred thereunder), and in each case as amended, modified, supplemented or refinanced from time to time.

“Credit Facilities” means one or more debt facilities or other financing arrangements (which may be outstanding at the same time and including, without limitation, the Credit Agreement) providing for revolving credit loans, term loans, letters of credit or other long-term indebtedness, including any notes, mortgages, guarantees, collateral documents, instruments and agreements executed in connection therewith and, in each case, as such agreements may be amended, amended and restated, supplemented, modified, refinanced, replaced or otherwise restructured, in whole or in part from time to time (including increasing the amount of available borrowings thereunder or adding Subsidiaries of the Issuer as additional borrowers or guarantors thereunder), with respect to all or any portion of the Indebtedness under such agreement or agreements or any successor or replacement agreement or agreements and whether or not with the same or any other agent, lender or group of lenders and whether or not provided under the Credit Agreement or any other credit or other agreement or indenture.

“Custodian” means any receiver, trustee, assignee, liquidator or similar official under any Bankruptcy Law.

“Default” means (1) any Event of Default or (2) any event, act or condition that, after notice or the passage of time or both, would be an Event of Default.

“Depository” means The Depository Trust Company, New York, New York, or a successor thereto registered under the Exchange Act or other applicable statute or regulation.

“Disqualified Equity Interests” of any Person means any class of Equity Interests of such Person that, by its terms, or by the terms of any related agreement or of any security into which it is convertible, puttable or exchangeable, is, or upon the happening of any event or the passage of time would be, required to be redeemed by such Person, whether or not at the option of the holder thereof, or matures or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, in whole or in part, on or prior to the date which is 91 days after the final maturity date of the Notes; provided, however, that any class of Equity Interests of such Person that, by its terms, authorizes such Person to satisfy in full its obligations with respect to the payment of dividends or upon maturity, redemption (pursuant to a sinking fund or otherwise) or repurchase thereof or otherwise by the delivery of Equity Interests that are not Disqualified Equity Interests, and that is not convertible, puttable or exchangeable for Disqualified Equity Interests or Indebtedness, will not be deemed to be Disqualified Equity Interests so long as such Person satisfies its obligations with respect thereto solely by the delivery of Equity Interests that are not Disqualified Equity Interests; provided, further, however, that any Equity Interests that would not constitute Disqualified Equity Interests but for provisions thereof giving holders thereof (or the holders of any security into or for which such Equity Interests are convertible, exchangeable or exercisable) the right to require the Issuer to redeem such Equity Interests upon the occurrence of a change in control or an asset disposition occurring prior to the final maturity date of the Notes shall not constitute Disqualified Equity Interests if the change of control or asset disposition provisions applicable to such Equity Interests are no more favorable to such holders than the provisions set forth in Section 4.09 and Section 4.13.

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

“Equity Interests” of any Person means (1) Capital Stock and (2) all rights to purchase, warrants or options (whether or not currently exercisable) to acquire Capital Stock (but excluding any debt security that is convertible into or exchangeable for Capital Stock).

“Exchange Act” means the U.S. Securities Exchange Act of 1934, as amended.

“Exchange Notes” has the meaning set forth in the Registration Rights Agreement.

“Exchange Offer” means the offer that may be made by the Issuer pursuant to the Registration Rights Agreement to exchange Notes bearing the Private Placement Legend for the Exchange Notes.

“Excluded Subsidiary” means (i) any Foreign Subsidiary, (ii) any Domestic Subsidiary that is a Subsidiary of a CFC, (iii) any Domestic Subsidiary that is a disregarded entity under the U.S. Internal Revenue Code and has no material assets other than the Equity Interests of one or more CFCs, (iv) any Immaterial Subsidiary and (v) any Unrestricted Subsidiary.

“Fair Market Value” means, with respect to any asset, the price (after taking into account any liabilities relating to such assets) that would be negotiated in an arm’s-length transaction between a willing seller and a willing and able buyer, neither of which is under any compulsion to complete the transaction, as such price is determined in good faith by an Officer, or, with respect to valuations in excess of $10.0 million, by the Board of Directors of the Issuer or a duly authorized committee thereof, as evidenced by a resolution of such Board or committee.

“Floating Rate Notes” means CPI International, Inc.’s Floating Rate Senior Notes due 2015 outstanding on the Issue Date.

“Foreign Subsidiary” means any Restricted Subsidiary of the Issuer which is not organized under the laws of (x) the United States or any State thereof or (y) the District of Columbia.

“GAAP” means generally accepted accounting principles set forth in the opinions and pronouncements of the Accounting Principles Board of the American Institute of Certified Public Accountants and statements and pronouncements of the Financial Accounting Standards Board or in such other statements by such other entity as may be approved by a significant segment of the accounting profession of the United States, as in effect on the Issue Date.  At any time after the Issue Date, the Issuer may elect to apply IFRS accounting principles in lieu of GAAP and, upon any such election, references herein to GAAP shall thereafter be construed to mean IFRS; provided that calculations or determinations in this Indenture that require the application of GAAP for periods that include fiscal quarters ended prior to the Issuer’s election to apply IFRS shall remain as previously calculated or determined in accordance with GAAP.  The Issuer shall give notice of any such election made in accordance with this definition to the Trustee and the Holders.

“guarantee” means a direct or indirect guarantee by any Person of any Indebtedness of any other Person and includes any obligation, direct or indirect, contingent or otherwise, of such Person:  (1) to purchase or pay (or advance or supply funds for the purchase or payment of) Indebtedness of such other Person (whether arising by virtue of partnership arrangements, or by agreements to keep-well, to purchase assets, goods, securities or services (unless such purchase arrangements are on arm’s-length terms and are entered into in the ordinary course of business), to take-or-pay, or to maintain financial statement conditions or otherwise); or (2) entered into for purposes of assuring in any other manner the obligee of such Indebtedness of the payment thereof or to protect such obligee against loss in respect thereof (in whole or in part); “guarantee,” when used as a verb, and “guaranteed” have correlative meanings.

“Guarantors” means Parent and each Restricted Subsidiary of the Issuer on the Issue Date (other than any Excluded Subsidiary), and each other Person that is required to, or at the election of the Issuer does, become a Guarantor by the terms of this Indenture after the Issue Date, in each case, until such Person is released from its Note Guarantee in accordance with the terms of this Indenture.

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“Hedging Obligations” of any Person means the obligations of such Person under swap, cap, collar, forward purchase or similar agreements or arrangements dealing with interest rates, currency exchange rates or commodity prices, either generally or under specific contingencies.

“Holder” means any registered holder, from time to time, of the Notes.

“IFRS” means international financial reporting standards and interpretations issued by the International Accounting Standards Board and adopted by the European Commission, as in effect from time to time.

“Immaterial Subsidiary” shall mean any Restricted Subsidiary of Parent (other than Issuer), which, together with its own Restricted Subsidiaries, as consolidated in the consolidated financial statements of Parent, accounts for (i) less than 1.0% of the consolidated assets of Parent as of the last day of the most recently ended fiscal quarter of Parent for which financial information is available and (ii) less than 1.0% of Consolidated Cash Flow for the most recently ended period of four consecutive fiscal quarters of Parent; provided that (x) all Immaterial Subsidiaries shall not, in the aggregate, account for more than 3.0% of the consolidated assets of Parent as of such most recently ended fiscal quarter or for more than 3.0% of the Consolidated Cash Flow of Parent for such most recently ended period of four consecutive fiscal quarters and (y) no Subsidiary that is an obligor under the Credit Agreement shall be an Immaterial Subsidiary.

“incur” means, with respect to any Indebtedness or Obligation, incur, create, issue, assume, guarantee or otherwise become directly or indirectly liable, contingently or otherwise, with respect to such Indebtedness or Obligation; provided that (1) the Indebtedness of a Person existing at the time such Person became a Restricted Subsidiary shall be deemed to have been incurred by such Restricted Subsidiary at such time and (2) none of the accrual of interest or dividends nor the accretion of accreted value, the accretion or amortization of original issue discount or the payment of interest or dividends in the form of additional Indebtedness or Disqualified Equity Interests of the same class shall be deemed to be an incurrence of Indebtedness.

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

(1)           all indebtedness of such Person for borrowed money (whether or not the recourse of the lender is to the whole of the assets of such Person or only to a portion thereof);

(2)           all indebtedness of such Person evidenced by bonds, debentures, notes or other similar instruments;

(3)           all reimbursement obligations of such Person in respect of letters of credit, letters of guaranty, bankers’ acceptances, bank guarantees and similar credit transactions;

(4)           all obligations of such Person to pay the deferred and unpaid purchase price of property or services, except trade payables and accrued expenses incurred by such Person in the ordinary course of business in connection with obtaining goods, materials or services;

(5)           the maximum fixed redemption or repurchase price of all Disqualified Equity Interests of such Person;

(6)           all Capitalized Lease Obligations of such Person;

(7)           all Indebtedness of others secured by a Lien on any asset of such Person, whether or not such Indebtedness is assumed by such Person;

(8)           all Indebtedness of others guaranteed by such Person to the extent of such guarantee; provided that Indebtedness of the Issuer or its Subsidiaries that is guaranteed by the Issuer or the Issuer’s Subsidiaries shall only be counted once in the calculation of the amount of Indebtedness of the Issuer and its Subsidiaries on a consolidated basis;

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(9)           all Attributable Indebtedness;

(10)         to the extent not otherwise included in this definition, net obligations of such Person under Hedging Obligations of such Person (the amounts of any such obligations to be equal at any time to the termination value of such Hedging Obligation that would be payable by, or to, such Person at such time); and

(11)         all obligations of such Person under conditional sale or other title retention agreements relating to assets purchased by such Person;

provided, that the foregoing clauses (3) (other than reimbursement obligations for letters of credit), (4), (6) and (11) shall only constitute Indebtedness if and to the extent such items would appear as a liability upon a balance sheet (excluding the footnotes thereto) of such Person prepared in accordance with GAAP; provided further, that Indebtedness shall not include any lease previously classified as an operating lease under GAAP that is reclassified as a Capitalized Lease as a result of a change in GAAP occurring after the Issue Date or any lease that but for any such change to GAAP would have been classified as an operating lease under GAAP.

The amount of any Indebtedness which is incurred at a discount to the principal amount at maturity thereof as of any date shall be deemed to have been incurred at the accreted value thereof as of such date.  The amount of Indebtedness of any Person at any date shall be the outstanding balance at such date of all unconditional obligations as described above, the maximum liability of such Person for any such contingent obligations at such date and, in the case of clause (7), the lesser of (a) the Fair Market Value of any asset subject to a Lien securing the Indebtedness of others on the date that the Lien attaches and (b) the amount of the Indebtedness secured.  For purposes of clause (5), the “maximum fixed redemption or repurchase price” of any Disqualified Equity Interests that do not have a fixed redemption or repurchase price shall be calculated in accordance with the terms of such Disqualified Equity Interests as if such Disqualified Equity Interests were redeemed or repurchased on any date on which an amount of Indebtedness outstanding shall be required to be determined pursuant to this Indenture.

“Indenture” means this Indenture, as amended or supplemented from time to time in accordance with the terms hereof.

“Independent Financial Advisor” means an accounting, appraisal or investment banking firm of nationally recognized standing that is, in the reasonable judgment of the Issuer’s Board of Directors, qualified to perform the task for which it has been engaged and is not an Affiliate of the Issuer and is otherwise disinterested with respect to the applicable transaction.

“Initial Purchasers” means UBS Securities LLC and KKR Capital Markets LLC.

“Institutional Accredited Investor” or “IAI” means an “accredited investor” with the meaning of Rule 501(a)(1), (2), (3) or (7) under the Securities Act.

“interest” means, with respect to the Notes, interest and Additional Interest, if any, on the Notes.

“Interest Payment Date” means the stated maturity of an installment of interest on the Notes.

“Investment Grade Rating” means a rating equal to or higher than Baa3 (or the equivalent) by Moody’s and BBB- (or the equivalent) by S&P, or an equivalent rating by any other Rating Agency.

“Investments” of any Person means:

(1)           all direct or indirect investments by such Person in any other Person in the form of loans, advances or capital contributions or other credit extensions constituting Indebtedness of such other Person (excluding accounts receivable, trade credit, advances to customers, commission, travel and similar advances to officers and employees, in each case, made in the ordinary course of business), and any guarantee of Indebtedness of any other Person;

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(2)           all purchases (or other acquisitions for consideration) by such Person of Indebtedness, Equity Interests or other securities of any other Person (other than any such purchase that constitutes a Restricted Payment of the type described in clause (2) of the definition thereof);

(3)           all other items that would be classified as investments on a balance sheet of such Person prepared in accordance with GAAP (in the same manner as the other investments included in this definition to the extent such transactions involve the transfer of cash or other property); and

(4)           the Designation of any Subsidiary as an Unrestricted Subsidiary.

Except as otherwise expressly specified in this definition, the amount of any Investment (other than an Investment made in cash) shall be the Fair Market Value thereof on the date such Investment is made.  The amount of Investment pursuant to clause (4) shall be the Designation Amount determined in accordance with Section 4.19.  If the Issuer or any Restricted Subsidiary sells or otherwise disposes of any Equity Interests of any direct or indirect Restricted Subsidiary such that, after giving effect to any such sale or disposition, such Person is no longer a Restricted Subsidiary, the Issuer shall be deemed to have made an Investment on the date of any such sale or other disposition equal to the Fair Market Value of the Investments in such Restricted Subsidiary not sold or disposed of, which amount shall be determined by the Board of Directors.  The acquisition by the Issuer or any Restricted Subsidiary of a Person that holds an Investment in a third Person shall be deemed to be an Investment by the Issuer or such Restricted Subsidiary in the third Person in an amount equal to the Fair Market Value of the Investment held by the acquired Person in the third Person.

The amount of any Investment outstanding at any time shall be deemed to be reduced:

(a)upon the disposition or repayment of or return on such Investment, by an amount equal to the return of capital or principal with respect to such Investment to the Issuer or any Restricted Subsidiary (to the extent not included in the computation of Consolidated Net Income or the Restricted Payments Basket), less the cost of the disposition of such Investment and net of taxes; and

(b)upon a Redesignation of an Unrestricted Subsidiary as a Restricted Subsidiary, by an amount equal to the lesser of (x) the Fair Market Value of the Issuer’s proportionate interest in such Subsidiary immediately following such Redesignation, and (y) the aggregate amount of Investments in such Subsidiary that increased (and did not previously decrease) the amount of Investments outstanding;

provided that the amount reducing the amount of Investments outstanding shall not also increase the Restricted Payments Basket pursuant to Section 4.11(a)(3)(d) or (e).

“Issue Date” means February 11, 2011.

“Lien” means, with respect to any asset, any mortgage, deed of trust, lien (statutory or other), pledge, lease, charge, security interest or other encumbrance of any kind or nature in respect of such asset, whether or not filed, recorded or otherwise perfected under applicable law, including any conditional sale or other title retention agreement, and any lease in the nature thereof, and any filing of, or agreement to give, any financing statement under the Uniform Commercial Code (or equivalent statutes) of any jurisdiction (other than cautionary filings in respect of operating leases); provided, that in no event shall an operating lease constitute a Lien.

“Maturity Date” means February 15, 2018.

“Merger” means the merger of Catalyst Acquisition, Inc. with and into CPI International, Inc. with CPI International, Inc. as the surviving entity.

“Moody’s” means Moody’s Investors Service, Inc., and its successors.

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“Net Available Proceeds” means, with respect to any Asset Sale, the proceeds thereof in the form of cash or Cash Equivalents, net of

(1)           the direct costs relating to such Asset Sale, including brokerage commissions and other fees and expenses (including fees and expenses of legal counsel, accountants and investment banks) of such Asset Sale;

(2)           relocation and demolition expenses incurred in connection with, or as a result of, such Asset Sale;

(3)           taxes paid and provisions for taxes payable as a result of such Asset Sale (after taking into account any available tax credits or deductions and any tax sharing arrangements);

(4)           amounts required to be paid to any Person (other than the Issuer or any Restricted Subsidiary) owning a beneficial interest in the assets subject to the Asset Sale or having a Lien thereon;

(5)           payments of unassumed liabilities (not constituting Indebtedness) relating to the assets sold at the time of, or within 90 days after the date of, such Asset Sale; and

(6)           appropriate amounts to be provided by the Issuer or any Restricted Subsidiary, as the case may be, as a reserve required in accordance with GAAP against any adjustment in the sale price of such asset or assets or liabilities associated with such Asset Sale and retained by the Issuer or any Restricted Subsidiary, as the case may be, after such Asset Sale, including pensions and other post-employment benefit liabilities, liabilities related to environmental matters and liabilities under any indemnification obligations associated with such Asset Sale; provided, however, that any amounts remaining after adjustments, revaluations or liquidations of such reserves shall constitute Net Available Proceeds at such time.

“Non-Recourse Debt” means Indebtedness of an Unrestricted Subsidiary:

(1)           as to which neither the Issuer nor any Restricted Subsidiary (a) provides credit support of any kind (including any undertaking, agreement or instrument that would constitute Indebtedness), or (b) is directly or indirectly liable as a guarantor or otherwise; and

(2)           no default with respect to which (including any rights that the holders thereof may have to take enforcement action against an Unrestricted Subsidiary) would permit upon notice, lapse of time or both any holder of any other Indebtedness (other than the Credit Agreement or the Notes) of the Issuer or any Restricted Subsidiary to declare a default on the other Indebtedness or cause the payment thereof to be accelerated or payable prior to its stated maturity.

“Non-U.S. Person” has the meaning assigned to such term in Regulation S.

“Note Guarantee” means the guarantee by each Guarantor pursuant to this Indenture of the Issuer’s payment obligations under this Indenture and the Notes.

“Notes” means, collectively, the Issuer’s 8.00% Senior Notes due 2018 issued in accordance with Section 2.02 (whether issued on the Issue Date, issued as Additional Notes, issued as Exchange Notes or Private Exchange Notes, or otherwise issued after the Issue Date) treated as a single class of securities under this Indenture, as amended or supplemented from time to time in accordance with the terms of this Indenture.

“Obligation” means any principal, interest, penalties, fees, indemnification, reimbursements, costs, expenses, damages and other liabilities payable under the documentation governing any Indebtedness.

“Offering Memorandum” means the offering memorandum of the Issuer relating to the Notes dated February 3, 2011.

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“Officer” means any of the following of the Issuer:  the Chairman of the Board of Directors, the Chief Executive Officer, the Chief Financial Officer, the President, any Vice President, the Treasurer or the Secretary.

“Officers’ Certificate” means a certificate signed by two Officers; provided, however, that for purposes of Section 4.06(a), “Officers’ Certificate” means a certificate signed by the principal executive officer, principal financial officer or principal accounting officer of the Issuer and at least one other Officer of the Issuer.

“Opinion of Counsel” means a written opinion from legal counsel who is reasonably acceptable to the Trustee.  The counsel may be an employee of, or counsel to, the Issuer or a Guarantor.

“Parent” means CPI International Holding Corp., a Delaware corporation, and its successors and assigns.

“Pari Passu Indebtedness” means any Indebtedness of the Issuer or any Guarantor that ranks pari passu in right of payment with the Notes or the Note Guarantees, as applicable.

“Permitted Business” means the businesses engaged in by the Issuer and its Subsidiaries on the Issue Date as described in the Offering Memorandum and businesses that are reasonably related thereto or reasonable extensions thereof or similar, incidental, ancillary or complementary thereto, including the business of power amplification and satellite communications.

“Permitted Holders” means Sponsor and members of management of the Issuer or its Restricted Subsidiaries on the Issue Date who are holders of Equity Interests of the Issuer or Parent and any group (within the meaning of Section 13(d)(3) or Section 14(d)(2) of the Exchange Act or any successor provision) of which any of the foregoing are members; provided that, in the case of such group and without giving effect to the existence of such group or any other group, Sponsor and such members of management, collectively, beneficially own Voting Stock representing more than 50% of the total voting power of the Voting Stock of the Issuer.

“Permitted Investments” means:

(1)           Investments by the Issuer or any Restricted Subsidiary in (a) any Restricted Subsidiary or (b) in any Person that will become immediately after such Investment a Restricted Subsidiary or that will merge or consolidate into the Issuer or a Restricted Subsidiary;

(2)           Investments in the Issuer by any Restricted Subsidiary;

(3)           loans and advances to or guarantees of Indebtedness of directors, employees and officers of the Issuer and the Restricted Subsidiaries not in excess of $4.0 million at any one time outstanding, and loans and advances to officers, directors and employees for business-related travel expenses, moving expenses and other similar expenses, in each case incurred in the ordinary course of business;

(4)           Hedging Obligations incurred pursuant to Section 4.10(b)(4);

(5)           cash and Cash Equivalents;

(6)           receivables owing to the Issuer or any Restricted Subsidiary if created or acquired in the ordinary course of business and payable or dischargeable in accordance with customary trade terms; provided, however, that such trade terms may include such concessionary trade terms as the Issuer or any such Restricted Subsidiary deems reasonable under the circumstances;

(7)           Investments in securities of trade creditors or customers received pursuant to any plan of reorganization or similar arrangement upon the bankruptcy or insolvency of such trade creditors or customers;

(8)           Investments made by the Issuer or any Restricted Subsidiary as a result of consideration received in connection with an Asset Sale made in compliance with Section 4.13;

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(9)           lease, utility and other similar deposits in the ordinary course of business;

(10)         Investments made by the Issuer or a Restricted Subsidiary for consideration consisting only of Qualified Equity Interests of the Issuer;

(11)         stock, obligations or securities received in settlement of debts created in the ordinary course of business and owing to the Issuer or any Restricted Subsidiary or in satisfaction of judgments;

(12)         any Investment existing on the Issue Date and any Investment consisting of an extension, modification or renewal of any Investment existing on the Issue Date; provided that the amount of any such Investment may only be increased (a) as required by the terms of such Investment as in existence on the Issue Date or (b) to the extent permitted by another clause in this definition of “Permitted Investments” or Section 4.11;

(13)         Investments acquired after the Issue Date as a result of the acquisition by the Issuer or any Restricted Subsidiary of the Issuer of another Person (including as contemplated by clause (1) above), including by way of a merger, amalgamation or consolidation with or into the Company or any of its Restricted Subsidiaries in a transaction that is not prohibited by Section 5.01 after the Issue Date, to the extent that such Investments were not made in contemplation of such acquisition;

(14)         guarantees of Indebtedness of the Issuer or any Restricted Subsidiary to the extent such Indebtedness is permitted to be incurred under this Indenture; and

(15)         other Investments in an aggregate amount not to exceed $25.0 million at any one time outstanding (with each Investment being valued as of the date made and without regard to subsequent changes in value).

“Permitted Liens” means the following types of Liens:

(1)           Liens for taxes, assessments or governmental charges or claims either (a) not delinquent for more than 30 days or (b) contested in good faith by appropriate proceedings and as to which the Issuer or the Restricted Subsidiaries shall have set aside on its books such reserves as may be required pursuant to GAAP;

(2)           statutory Liens of landlords and Liens of carriers, warehousemen, mechanics, suppliers, materialmen, repairmen and other Liens imposed by law incurred in the ordinary course of business for sums not yet delinquent for more than 30 days or being contested in good faith, if such reserve or other appropriate provision, if any, as shall be required by GAAP shall have been made in respect thereof;

(3)           Liens incurred or deposits made in the ordinary course of business in connection with workers’ compensation, unemployment insurance and other types of social security, or to secure the performance of tenders, statutory obligations, surety and appeal bonds, bids, leases, government contracts, performance and return-of-money bonds and other similar obligations (exclusive of obligations for the payment of borrowed money);

(4)           Liens upon specific items of inventory or other goods and proceeds of any Person securing such Person’s obligations in respect of bankers’ acceptances issued or created for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods;

(5)           judgment Liens not giving rise to a Default so long as such Liens are adequately bonded and any appropriate legal proceedings which may have been duly initiated for the review of such judgment have not been finally terminated or the period within which the proceedings may be initiated has not expired;

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(6)           easements, rights-of-way, zoning restrictions and other similar charges, restrictions or encumbrances in respect of real property or immaterial imperfections of title which do not, in the aggregate, impair in any material respect the ordinary conduct of the business of the Issuer and the Restricted Subsidiaries taken as a whole;

(7)           Liens securing reimbursement obligations with respect to commercial letters of credit which encumber documents and other assets relating to such letters of credit and products and proceeds thereof;

(8)           Liens encumbering deposits made to secure obligations arising from statutory, regulatory, contractual or warranty requirements of the Issuer or any Restricted Subsidiary, including rights of offset and setoff;

(9)           bankers’ Liens, rights of setoff and other similar Liens existing solely with respect to cash and Cash Equivalents on deposit in one or more of accounts maintained by the Issuer or any Restricted Subsidiary, in each case granted in the ordinary course of business in favor of the bank or banks with which such accounts are maintained, securing amounts owing to such bank with respect to cash management and operating account arrangements, including those involving pooled accounts and netting arrangements; provided that in no case shall any such Liens secure (either directly or indirectly) the repayment of any Indebtedness;

(10)         leases, subleases, licenses or sublicenses granted to others that do not materially interfere with the ordinary course of business of the Issuer or any Restricted Subsidiary;

(11)         Liens arising from filing Uniform Commercial Code financing statements regarding leases;

(12)         Liens securing all of the Notes and Liens securing any Note Guarantee;

(13)         Liens existing on the Issue Date;

(14)         Liens in favor of the Issuer or a Guarantor;

(15)         Liens securing obligations with respect to Indebtedness incurred under clause (1) of the definition of “Permitted Indebtedness”;

(16)         Liens securing Purchase Money Indebtedness and Capitalized Lease Obligations; provided that such Liens shall not extend to any asset other than the specified asset being financed and additions and improvements thereon;

(17)         Liens securing Acquired Indebtedness permitted to be incurred under this Indenture; provided that the Liens do not extend to assets not subject to such Lien at the time of acquisition (other than improvements thereon) and are no more favorable to the lienholders than those securing such Acquired Indebtedness prior to the incurrence of such Acquired Indebtedness by the Issuer or a Restricted Subsidiary;

(18)         Liens on assets of Foreign Subsidiaries securing Indebtedness of Foreign Subsidiaries;

(19)         Liens on assets or Equity Interests of a Person existing at the time such Person is acquired or merged with or into or consolidated with the Issuer or any such Restricted Subsidiary (and not created in anticipation or contemplation thereof);

(20)         Liens to secure Refinancing Indebtedness of Indebtedness secured by Liens referred to in the foregoing clauses (13), (16), (17) and (19); provided that such Liens do not extend to any additional assets (other than improvements thereon and replacements thereof);

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(21)         Liens to secure Attributable Indebtedness; provided that any such Lien shall not extend to or cover any assets of the Issuer or any Restricted Subsidiary other than the assets which are the subject of the Sale and Leaseback Transaction in which the Attributable Indebtedness is incurred;

(22)         Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the importation of goods;

(23)         Liens securing Hedging Obligations permitted to be incurred under this Indenture;

(24)         Liens incurred in the ordinary course of business of the Issuer or any Restricted Subsidiary with respect to obligations that do not in the aggregate exceed $25.0 million at any one time outstanding; and

(25)         Liens securing Indebtedness permitted to be incurred pursuant to Section 4.10; provided that at the time of incurrence and after giving pro forma effect thereto, the Consolidated Secured Debt Ratio would be no greater than 3:50 to 1:00.

“Person” means any individual, corporation, partnership, limited liability company, joint venture, incorporated or unincorporated association, joint-stock company, trust, unincorporated organization or government or other agency or political subdivision thereof or other entity of any kind.

“Preferred Stock” means, with respect to any Person, any and all Capital Stock (however designated) of such Person whether now outstanding or issued after the Issue Date with preferential rights of payment of dividends or upon liquidation, dissolution or winding up.

“principal” means, with respect to the Notes, the principal of, and premium, if any, on the Notes.

“Private Exchange Notes” has the meaning given to it in the Registration Rights Agreement.

“Private Placement Legend” means the legends initially set forth on the Notes in the form set forth in Exhibit B.

“Purchase Money Indebtedness” means Indebtedness, including Capitalized Lease Obligations, of the Issuer or any Restricted Subsidiary incurred for the purpose of financing all or any part of the purchase price or lease of property, plant or equipment used or useful in the business of the Issuer or any Restricted Subsidiary or the cost of installation, construction or improvement thereof whether securing the direct purchase of assets or the Capital Stock of any Person owning such assets; provided, however, that (1) the amount of such Indebtedness shall not exceed such purchase price or cost and (2) such Indebtedness shall be incurred within 180 days after the acquisition or lease of such asset by the Issuer or such Restricted Subsidiary or such installation, construction or improvement.

“Qualified Equity Interests” means Equity Interests of the Issuer other than Disqualified Equity Interests; provided that such Equity Interests shall not be deemed Qualified Equity Interests to the extent sold or owed to a Subsidiary of the Issuer or financed, directly or indirectly, using funds (1) borrowed from the Issuer or any Subsidiary of the Issuer until and to the extent such borrowing is repaid or (2) contributed, extended, guaranteed or advanced by the Issuer or any Subsidiary of the Issuer (including, without limitation, in respect of any employee stock ownership or benefit plan).

“Qualified Equity Offering” means the issuance and sale of Qualified Equity Interests of the Issuer or any Equity Interests of any direct or indirect parent of the Issuer to Persons other than any Permitted Holder or any other Person who is not, prior to such issuance and sale, an Affiliate of the Issuer, other than in connection with a transaction or series of transactions constituting a Change of Control; provided, however, that if such issuance is made by any direct or indirect parent of the Issuer, cash proceeds therefrom equal to not less than 100% of the aggregate principal amount of any Notes to be redeemed are received by the Issuer as a contribution to the common equity capital of the Issuer immediately prior to such redemption.

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“QIB” shall have the meaning specified in Rule 144A under the Securities Act.

“Rating Agencies” means Moody’s and S&P or if Moody’s or S&P or both shall not make a rating on the Notes publicly available, a nationally recognized statistical rating agency or agencies, as the case may be, selected by the Issuer which shall be substituted for Moody’s or S&P or both, as the case may be.

“Record Date” means the applicable Record Date specified in the Notes; provided that if any such date is not a Business Day, the Record Date shall be the first day immediately succeeding such specified day that is a Business Day.

“redeem” means to redeem, repurchase, purchase, defease, retire, discharge or otherwise acquire or retire for value; and “redemption” shall have a correlative meaning; provided that this definition shall not apply for purposes of Section 5 of the Notes or Article III.

“Redemption Date,” when used with respect to any Note to be redeemed, means the date fixed for such redemption pursuant to this Indenture and the Notes.

“Redemption Price,” when used with respect to any Note to be redeemed, means the price fixed for such redemption, payable in immediately available funds, pursuant to this Indenture and the Notes.

“refinance” means to refinance, repay, prepay, replace, renew or refund, including successively.

“Refinancing Indebtedness” means Indebtedness of the Issuer or a Restricted Subsidiary issued in exchange for, or the proceeds of which are used, within 90 days of such issuance or receipt of such proceeds to redeem or refinance in whole or in part, or constituting an amendment of, any Indebtedness of the Issuer or any Restricted Subsidiary (the “Refinanced Indebtedness”); provided that:

(1)           the principal amount (or accreted value, in the case of Indebtedness issued at a discount) of the Refinancing Indebtedness does not exceed the principal amount (or accreted value, as the case may be) of the Refinanced Indebtedness plus the amount of accrued and unpaid interest on the Refinanced Indebtedness, any premium paid to the holders of the Refinanced Indebtedness, defeasance costs and reasonable expenses incurred in connection with the incurrence of the Refinancing Indebtedness;

(2)           the obligor of Refinancing Indebtedness does not include any Person (other than the Issuer or any Guarantor) that is not an obligor of the Refinanced Indebtedness;

(3)           if the Refinanced Indebtedness was subordinated to the Notes or the Note Guarantees, as the case may be, then such Refinancing Indebtedness, by its terms, is subordinate in right of payment to the Notes or the Note Guarantees, as the case may be, at least to the same extent as the Refinanced Indebtedness is subordinated in right of payment to the Notes or the Note Guarantees, as the case may be;

(4)           the Refinancing Indebtedness is scheduled to mature no earlier than the earlier of (a) the maturity of the Refinanced Indebtedness being repaid or amended or (b) after the maturity date of the Notes; and

(5)           the portion, if any, of the Refinancing Indebtedness that is scheduled to mature on or prior to the maturity date of the Notes has a Weighted Average Life to Maturity at the time such Refinancing Indebtedness is incurred that is equal to or greater than the Weighted Average Life to Maturity of the portion of the Refinanced Indebtedness being repaid that is scheduled to mature on or prior to the maturity date of the Notes.

“Registration Rights Agreement” means the Registration Rights Agreement dated as of February 11, 2011 among the Issuer, the Guarantors and the Initial Purchasers, as amended, supplemented or modified from time to time, and any similar agreement entered into in connection with the issuance of any Additional Notes.

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“Regulation S” means Regulation S under the Securities Act.

“Regulation S Global Note” has the meaning given to such term in Section 2.01.

“Responsible Officer” means, when used with respect to the Trustee, any officer in the Corporate Trust Office of the Trustee, including any vice president, assistant vice president, assistant secretary, assistant treasurer, trust officer or any other officer of the Trustee who customarily performs functions similar to those performed by the persons who at the time shall be such officers, respectively, to whom any corporate trust matter is referred because of such person’s knowledge of and familiarity with the particular subject and who shall have direct responsibility for the administration of this Indenture.

“Restricted Payment” means any of the following:

(1)           the declaration or payment of any dividend or any other distribution on Equity Interests of the Issuer or any Restricted Subsidiary, including, without limitation, any payment in connection with any merger or consolidation involving the Issuer but excluding (a) dividends or distributions payable solely in Qualified Equity Interests and (b) in the case of Restricted Subsidiaries, dividends or distributions payable to the Issuer or to a Restricted Subsidiary and pro rata dividends or distributions payable to minority stockholders of any Restricted Subsidiary;

(2)           the redemption of any Equity Interests of the Issuer or any Restricted Subsidiary, including, without limitation, any payment in connection with any merger or consolidation involving the Issuer but excluding any such Equity Interests held by the Issuer or any Restricted Subsidiary;

(3)           any Investment other than a Permitted Investment; or

(4)           any redemption prior to the scheduled maturity or prior to any scheduled repayment of principal or sinking fund payment, as the case may be, in respect of Subordinated Indebtedness.

“Restricted Payments Basket” has the meaning given to such term in Section 4.11(a).

“Restricted Security” means a Note that constitutes a “Restricted Security” within the meaning of Rule 144(a)(3) under the Securities Act; provided, however, that the Trustee shall be entitled to request and conclusively rely on an Opinion of Counsel with respect to whether any Note constitutes a Restricted Security.

“Restricted Subsidiary” means any Subsidiary of the Issuer other than an Unrestricted Subsidiary.

“Restructuring Expenses” means losses, expenses and charges incurred in connection with restructuring within the Issuer and/or one or more Restricted Subsidiaries, including in connection with integration of acquired businesses or Persons, disposition of one or more Subsidiaries or businesses, exiting of one or more lines of businesses and relocation or consolidation of facilities, including severance, lease termination and other non-ordinary course, non-operating costs and expenses in connection therewith.

“Rule 144A” means Rule 144A under the Securities Act.

“S&P” means Standard & Poor’s Ratings Services, a division of the McGraw-Hill Companies, Inc., and its successors.

“Sale and Leaseback Transactions” means with respect to any Person an arrangement with any bank, insurance company or other lender or investor or to which such lender or investor is a party, providing for the leasing by such Person of any asset of such Person which has been or is being sold or transferred by such Person to such lender or investor or to any Person to whom funds have been or are to be advanced by such lender or investor on the security of such asset.

“SEC” means the U.S. Securities and Exchange Commission.

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“Secretary’s Certificate” means a certificate signed by the Secretary of the Issuer.

“Securities Act” means the U.S. Securities Act of 1933, as amended.

“Significant Subsidiary” means (1) any Restricted Subsidiary that would be a “significant subsidiary” as defined in Regulation S-X promulgated pursuant to the Securities Act as such Regulation is in effect on the Issue Date and (2) any Restricted Subsidiary that, when aggregated with all other Restricted Subsidiaries that are not otherwise Significant Subsidiaries and as to which any event described in Section 6.01(7) or (8) has occurred and is continuing, would constitute a Significant Subsidiary under clause (1) of this definition.

“Sponsor” means Veritas Capital Fund Management, L.L.C. and its Affiliates and funds or partnerships managed by it or its Affiliates but not including any portfolio companies of the foregoing.

“Subordinated Indebtedness” means Indebtedness of the Issuer or any Guarantor that is by its terms subordinated in right of payment to the Notes or the Note Guarantees, respectively.

“Subject Transaction” means any of the Transactions, any future acquisition, investment, disposition, issuance, incurrence or repayment of Indebtedness, offering, issuance or disposition of Equity Interests, recapitalization, merger, consolidation, disposed or discontinued operation, multi-year strategic initiative or any other cost saving action or initiative made by the Issuer or any of its Restricted Subsidiaries, including through mergers or consolidations, or any Person or any of its Restricted Subsidiaries acquired by the Issuer or any of its Restricted Subsidiaries, and including any related financing transactions and including increases in ownership of Restricted Subsidiaries.

“Subsidiary” means, with respect to any Person:

(1)           any corporation, limited liability company, association or other business entity of which more than 50% of the total voting power of the Equity Interests entitled (without regard to the occurrence of any contingency) to vote in the election of the Board of Directors thereof are at the time owned or controlled, directly or indirectly, by such Person or one or more of the other Subsidiaries of that Person (or a combination thereof) or is consolidated under GAAP with such Person; and

(2)           any partnership (a) the sole general partner or the managing general partner of which is such Person or a Subsidiary of such Person, (b) the only general partners of which are such Person or of one or more Subsidiaries of such Person (or any combination thereof) or (c) is consolidated under GAAP with such Person.

Unless otherwise specified, “Subsidiary” refers to a Subsidiary of the Issuer.

“Subsidiary Guarantor” means any Guarantor other than Parent.

“Temporary Regulation S Global Note” has the meaning given to such term in Section 2.01.

“Transactions” means the Merger and the transactions related thereto, the offering of the Notes, the equity contribution by affiliates of the Sponsor, the refinancing of the existing senior credit facilities of Communications & Power Industries, Inc., the 8% Senior Subordinated Notes and the Floating Rate Notes and borrowings made on the Issue Date pursuant to the Credit Agreement.

“Treasury Rate” means, with respect to a Redemption Date, the yield to maturity at the time of computation of United States Treasury securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519) that has become publicly available at least two Business Days prior to such Redemption Date (or, if such Statistical Release is no longer published, any publicly available source of similar market data)) most nearly equal to the period from such Redemption Date to February 15, 2015; provided, however, that if the period from such Redemption Date to February 15, 2015 is not equal to the constant maturity of the United States Treasury security for which a weekly average yield is given, the Treasury Rate shall be obtained by linear interpolation (calculated to the nearest one-twelfth of a year) from the weekly average yields of United States

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Treasury securities for which such yields are given, except that if the period from such Redemption Date to February 15, 2015 is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year shall be used.

“Trust Indenture Act” means the Trust Indenture Act of 1939, as amended.

“Trustee” means the party named as such in this Indenture until a successor replaces it in accordance with the provisions of this Indenture and thereafter means such successor.

“Unrestricted Subsidiary” means (1) any Subsidiary that at the time of determination shall be designated an Unrestricted Subsidiary by the Board of Directors of the Issuer in accordance with Section 4.19 and (2) any Subsidiary of an Unrestricted Subsidiary.

“U.S. Government Obligations” means direct non-callable obligations of, or obligations guaranteed by, the United States of America for the payment of which guarantee or obligations the full faith and credit of the United States is pledged.

“U.S. Legal Tender” means such coin or currency of the United States of America that at the time of payment shall be legal tender for the payment of public and private debts.

“Voting Stock” with respect to any Person means securities of any class of Equity Interests of such Person entitling the holders thereof (whether at all times or only so long as no senior class of stock or other relevant equity interest has voting power by reason of any contingency) to vote in the election of members of the Board of Directors of such Person.

“Weighted Average Life to Maturity” when applied to any Indebtedness at any date, means the number of years obtained by dividing (1) the sum of the products obtained by multiplying (a) the amount of each then remaining installment, sinking fund, serial maturity or other required payment of principal, including payment at final maturity, in respect thereof, by (b) the number of years (calculated to the nearest one-twelfth) that will elapse between such date and the making of such payment by (2) the then outstanding principal amount of such Indebtedness.

“Wholly-Owned Restricted Subsidiary” means a Restricted Subsidiary of which 100% of the Equity Interests (except for directors’ qualifying shares or certain minority interests owned by other Persons solely due to local law requirements that there be more than one stockholder, but which interest is not in excess of what is required for such purpose) are owned directly by the Issuer or through one or more Wholly-Owned Restricted Subsidiaries.

SECTION 1.02.          Other Definitions.

Term	Defined in Section
“144A Global Note”	2.01
“Additional Notes”	2.02
“Affiliate Transaction”	4.14
“Authentication Order”	2.02
“Change of Control Offer”	4.09
“Change of Control Payment Date”	4.09
“Change of Control Purchase Price”	4.09
“Covenant Defeasance”	8.02
“Coverage Ratio Exception”	4.10
“Designation”	4.19
“Designation Amount”	4.19
“Event of Default”	6.01
“Excess Proceeds”	4.13
“Four-Quarter Period”	1.01

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Term	Defined in Section
“Global Note”	2.01
“Guarantee Obligations”	11.01
“IAI Global Note”	2.01
“Initial Global Note”	2.01
“Initial Note”	2.02
“Legal Defeasance”	8.02
“Net Proceeds Deficiency”	4.13
“Net Proceeds Offer”	4.13
“Net Proceeds Payment Date”	4.13
“Offered Price”	4.13
“Pari Passu Indebtedness Price”	4.13
“Parent Successor”	5.01
“Participants”	2.15
“Paying Agent”	2.03
“Payment Amount”	4.13
“Permitted Indebtedness”	4.10
“Permanent Regulation S Global Note”	2.01
“Physical Notes”	2.01
“Redesignation”	4.19
“Registrar”	2.03
“Restricted Payments Basket”	4.11
“Reversion Date”	4.05
“Successor”	5.01
“Suspended Covenants”	4.05
“Suspension Date”	4.05
“Suspension Period”	4.05
“Transaction Date”	1.01

SECTION 1.03.          Incorporation by Reference of Trust Indenture Act.

Whenever this Indenture refers to a provision of the Trust Indenture Act, such provision is incorporated by reference in, and made a part of, this Indenture.  The following Trust Indenture Act terms used in this Indenture have the following meanings:

“indenture securities” means the Notes.

“indenture security holder” means a Holder.

“indenture to be qualified” means this Indenture.

“indenture trustee” or “institutional trustee” means the Trustee.

“obligor” on the indenture securities means the Issuer, any Guarantor or any other obligor on the Notes.

All other Trust Indenture Act terms used in this Indenture that are defined by the Trust Indenture Act, defined by Trust Indenture Act reference to another statute or defined by SEC rule and not otherwise defined herein have the meanings assigned to them therein.

SECTION 1.04.          Rules of Construction.

Unless the context otherwise requires:

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(1)           a term has the meaning assigned to it;

(2)           an accounting term not otherwise defined has the meaning assigned to it in accordance with GAAP;

(3)           “or” is not exclusive;

(4)           words in the singular include the plural, and words in the plural include the singular;

(5)           provisions apply to successive events and transactions;

(6)           “herein,” “hereof” and other words of similar import refer to this Indenture as a whole and not to any particular Article, Section or other subdivision; and

(7)           the words “including,” “includes” and similar words shall be deemed to be followed by “without limitation.”

ARTICLE TWO

THE NOTES

SECTION 2.01.          Form and Dating.

The Notes and the Trustee’s certificate of authentication shall be substantially in the form of Exhibit A hereto.  The Notes may have notations, legends or endorsements required by law, stock exchange rule or usage.  The Issuer shall approve the form of the Notes and any notation, legend or endorsement on them.  Each Note shall be dated the date of its issuance and show the date of its authentication.

The terms and provisions contained in the Notes shall constitute, and are hereby expressly made, a part of this Indenture and, to the extent applicable, the Issuer, the Guarantors and the Trustee, by their execution and delivery of this Indenture, expressly agree to such terms and provisions and to be bound thereby.

Notes offered and sold in reliance on Rule 144A shall be issued initially in the form of a single permanent global Note in registered form, substantially in the form set forth in Exhibit A (the “144A Global Note”), deposited with the Trustee, as custodian for the Depository, duly executed by the Issuer and authenticated by the Trustee as hereinafter provided and shall bear the legends set forth in Exhibit B.

Notes offered and sold in offshore transactions in reliance on Regulation S shall be issued initially in the form of a single temporary global Note in registered form, substantially in the form of Exhibit A (the “Temporary Regulation S Global Note”), deposited with the Trustee, as custodian for the Depository, duly executed by the Issuer and authenticated by the Trustee as hereinafter provided and shall bear the legends set forth in Exhibit B.  Reasonably promptly following the date that is 40 days after the later of the commencement of the offering of the Notes in reliance on Regulation S and the Issue Date, upon receipt by the Trustee and the Issuer of a duly executed certificate certifying that the Holder of the beneficial interest in the Temporary Regulation S Global Note is a Non-U.S. Person, substantially in the form of Exhibit E from the Depository, a single permanent global Note in registered form substantially in the form of Exhibit A (the “Permanent Regulation S Global Note,” and together with the Temporary Regulation S Global Note, the “Regulation S Global Note”) duly executed by the Issuer and authenticated by the Trustee as hereinafter provided shall be deposited with the Trustee, as custodian for the Depository, and the Registrar shall reflect on its books and records the cancellation of the Temporary Regulation S Global Note and the issuance of the Permanent Regulation S Global Note.

The initial offer and resale of the Notes shall not be to an Institutional Accredited Investor.  The Notes resold to Institutional Accredited Investors in connection with the first transfer made pursuant to Section 2.16(a) shall be issued initially in the form of a single permanent Global Note in registered form, substantially in the form set forth in Exhibit A (the “IAI Global Note,” and, together with the 144A Global Note and the Regulation S Global

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Note, the “Initial Global Notes”), deposited with the Trustee, as custodian for the Depository, duly executed by the Issuer and authenticated by the Trustee as hereinafter provided and shall bear the legend set forth in Exhibit B.

Notes issued after the Issue Date shall be issued initially in the form of one or more global Notes in registered form, substantially in the form set forth in Exhibit A, deposited with the Trustee, as custodian for the Depository, duly executed by the Issuer and authenticated by the Trustee as hereinafter provided and shall bear any legends required by applicable law (together with the Initial Global Notes, the “Global Notes”) or as Physical Notes.

The aggregate principal amount of the Global Notes may from time to time be increased or decreased by adjustments made on the records of the Trustee, as custodian for the Depository, as hereinafter provided.  Notes issued in exchange for interests in a Global Note pursuant to Section 2.16 may be issued in the form of permanent certificated Notes in registered form in substantially the form set forth in Exhibit A and bearing the applicable legends, if any, (the “Physical Notes”).

SECTION 2.02.          Execution, Authentication and Denomination; Additional Notes; Exchange Notes.

One Officer of the Issuer (who shall have been duly authorized by all requisite corporate actions) shall sign the Notes for such Issuer by manual or facsimile signature.

If an Officer whose signature is on a Note was an Officer at the time of such execution but no longer holds that office at the time the Trustee authenticates the Note, the Note shall nevertheless be valid.

A Note shall not be valid until an authorized signatory of the Trustee manually signs the certificate of authentication on the Note.  The signature shall be conclusive evidence that the Note has been authenticated under this Indenture.

The Trustee shall authenticate (i) on the Issue Date, Notes for original issue in the aggregate principal amount not to exceed $215,000,000 (the “Initial Notes”), (ii) additional Notes (the “Additional Notes”) in an unlimited amount (so long as not otherwise prohibited by the terms of this Indenture, including, without limitation, Section 4.10) and (iii) Exchange Notes or Private Exchange Notes (x) in exchange for a like principal amount of Initial Notes or (y) in exchange for a like principal amount of Additional Notes in each case upon a written order of the Issuer in the form of a certificate of an Officer of the Issuer (an “Authentication Order”).  Each such Authentication Order shall specify the amount of Notes to be authenticated and the date on which the Notes are to be authenticated, whether the Notes are to be Initial Notes, Exchange Notes, Private Exchange Notes or Additional Notes and whether the Notes are to be issued as certificated Notes or Global Notes or such other information as the Trustee may reasonably request.  In addition, with respect to authentication pursuant to clause (ii) or (iii) of the first sentence of this paragraph, the first such Authentication Order from the Issuer shall be accompanied by an Opinion of Counsel of the Issuer in a form reasonably satisfactory to the Trustee.

All Notes issued under this Indenture shall be treated as a single class for all purposes under this Indenture.  The Additional Notes and the Private Exchange Notes shall bear any legend required by applicable law.

The Trustee may appoint an authenticating agent reasonably acceptable to the Issuer to authenticate Notes.  Unless otherwise provided in the appointment, an authenticating agent may authenticate Notes whenever the Trustee may do so.  Each reference in this Indenture to authentication by the Trustee includes authentication by such agent.  An authenticating agent has the same rights as an Agent to deal with the Issuer and Affiliates of the Issuer.  The Trustee shall have the right to decline to authenticate and deliver any Notes under this Indenture if the Trustee, being advised by counsel, determines that such action may not lawfully be taken or if the Trustee in good faith shall determine that such action would expose the Trustee to personal liability.

The Notes shall be issuable only in registered form without coupons in denominations of $1,000 and integral multiples of $1,000.

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SECTION 2.03.          Registrar and Paying Agent.

The Issuer shall maintain or cause to be maintained an office or agency in the Borough of Manhattan, The City of New York, where (a) Notes may be presented or surrendered for registration of transfer or for exchange (“Registrar”), (b) Notes may, subject to Section 2 of the Notes, be presented or surrendered for payment (“Paying Agent”) and (c) notices and demands to or upon the Issuer in respect of the Notes and this Indenture may be served.  The Issuer may also from time to time designate one or more other offices or agencies where the Notes may be presented or surrendered for any or all such purposes and may from time to time rescind such designations; provided, however, that no such designation or rescission shall in any manner relieve the Issuer of its obligation to maintain or cause to be maintained an office or agency in the Borough of Manhattan, The City of New York, for such purposes.  The Issuer may act as Registrar or Paying Agent, except that for the purposes of Articles Three and Eight and Sections 4.09 and 4.13, neither the Issuer nor any Affiliate of the Issuer shall act as Paying Agent.  The Registrar shall keep a register of the Notes and of their transfer and exchange.  The Issuer, upon notice to the Trustee, may have one or more co-registrars and one or more additional paying agents reasonably acceptable to the Trustee.  The term “Registrar” includes any co-registrar and the term “Paying Agent” includes any additional paying agent.  The Issuer initially appoints the Trustee as Registrar and Paying Agent until such time as the Trustee has resigned or a successor has been appointed.

The Issuer shall enter into an appropriate agency agreement with any Agent not a party to this Indenture, which agreement shall implement the provisions of this Indenture that relate to such Agent.  The Issuer shall notify the Trustee, in advance, of the name and address of any such Agent.  If the Issuer fails to maintain a Registrar or Paying Agent, the Trustee shall act as such.

SECTION 2.04.          Paying Agent To Hold Assets in Trust.

The Issuer shall require each Paying Agent other than the Trustee or the Issuer or any Subsidiary to agree in writing that each Paying Agent shall hold in trust for the benefit of Holders or the Trustee all assets held by the Paying Agent for the payment of principal of, or interest on, the Notes (whether such assets have been distributed to it by the Issuer or any other obligor on the Notes), and shall notify the Trustee of any Default by the Issuer (or any other obligor on the Notes) in making any such payment.  The Issuer at any time may require a Paying Agent to distribute all assets held by it to the Trustee and account for any assets disbursed and the Trustee may at any time during the continuance of any payment Default, upon written request to a Paying Agent, require such Paying Agent to distribute all assets held by it to the Trustee and to account for any assets distributed.  Upon distribution to the Trustee of all assets that shall have been delivered by the Issuer to the Paying Agent, the Paying Agent shall have no further liability for such assets.

SECTION 2.05.          Holder Lists.

The Trustee shall preserve in as current a form as is reasonably practicable the most recent list available to it of the names and addresses of Holders.  If the Trustee is not the Registrar, the Issuer shall furnish to the Trustee at least two (2) Business Days prior to each Interest Payment Date and at such other times as the Trustee may request in writing a list, in such form and as of such date as the Trustee may reasonably require, of the names and addresses of Holders, which list may be conclusively relied upon by the Trustee.

SECTION 2.06.          Transfer and Exchange.

Subject to Sections 2.15 and 2.16, when Notes are presented to the Registrar with a request to register the transfer of such Notes or to exchange such Notes for an equal principal amount of Notes of other authorized denominations, the Registrar shall register the transfer or make the exchange as requested if its requirements for such transaction are met; provided, however, that the Notes surrendered for transfer or exchange shall be duly endorsed or accompanied by a written instrument of transfer in form satisfactory to the Issuer and the Registrar, duly executed by the Holder thereof or his or her attorney duly authorized in writing.  To permit registrations of transfers and exchanges, the Issuer shall execute and the Trustee shall authenticate Notes at the Registrar’s request.  No service charge shall be made for any registration of transfer or exchange, but the Issuer may require payment of a sum sufficient to cover any transfer tax or similar governmental charge payable in connection therewith.

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Without the prior written consent of the Issuer, the Registrar shall not be required to register the transfer of or exchange of any Note (i) during a period beginning at the opening of business 15 days before the mailing of a notice of redemption of Notes and ending at the close of business on the day of such mailing, (ii) selected for redemption in whole or in part pursuant to Article Three, except the unredeemed portion of any Note being redeemed in part, and (iii) beginning at the opening of business on any Record Date and ending on the close of business on the related Interest Payment Date.

Any Holder of a beneficial interest in a Global Note shall, by acceptance of such beneficial interest, agree that transfers of beneficial interests in such Global Note may be effected only through a book-entry system maintained by the Holder of such Global Note (or its agent) in accordance with the applicable legends thereon, and that ownership of a beneficial interest in the Note shall be required to be reflected in a book-entry system.

SECTION 2.07.          Replacement Notes.

If a mutilated Note is surrendered to the Trustee or if the Holder of a Note claims that the Note has been lost, destroyed or wrongfully taken, the Issuer shall issue and the Trustee shall authenticate a replacement Note if the Trustee’s requirements are met.  Such Holder must provide an indemnity bond or other indemnity, sufficient in the judgment of both the Issuer and the Trustee, to protect the Issuer, the Trustee or any Agent from any loss which any of them may suffer if a Note is replaced.  The Issuer may charge such Holder for its reasonable out-of-pocket expenses in replacing a Note pursuant to this Section 2.07, including reasonable fees and expenses of counsel and of the Trustee.

Every replacement Note is an additional obligation of the Issuer and of the Guarantors thereof.

The provisions of this Section 2.07 are exclusive and shall preclude (to the extent lawful) all other rights and remedies with respect to the replacement or payment of lost, destroyed or wrongfully taken Notes.

SECTION 2.08.          Outstanding Notes.

Notes outstanding at any time are all the Notes that have been authenticated by the Trustee except those cancelled by it, those delivered to it for cancellation and those described in this Section as not outstanding.  A Note does not cease to be outstanding because the Issuer, the Guarantors or any of their respective Affiliates hold the Note (subject to the provisions of Section 2.09).

If a Note is replaced pursuant to Section 2.07 (other than a mutilated Note surrendered for replacement), it ceases to be outstanding unless a Responsible Officer of the Trustee receives proof satisfactory to it that the replaced Note is held by a bona fide purchaser.  A mutilated Note ceases to be outstanding upon surrender of such Note and replacement thereof pursuant to Section 2.07.

If the principal amount of any Note is considered paid under Section 4.01, it ceases to be outstanding and interest ceases to accrue.  If on a Redemption Date or the Maturity Date the Trustee or Paying Agent (other than the Issuer or an Affiliate thereof) holds U.S. Legal Tender or U.S. Government Obligations sufficient to pay all of the principal and interest due on the Notes payable on that date, then on and after that date such Notes cease to be outstanding and interest on them ceases to accrue.

SECTION 2.09.          Treasury Notes.

In determining whether the Holders of the required principal amount of Notes have concurred in any direction, waiver or consent, Notes owned by the Issuer or any of its Affiliates shall be disregarded, except that, for the purposes of determining whether the Trustee shall be protected in relying on any such direction, waiver or consent, only Notes that a Responsible Officer of the Trustee actually knows are so owned shall be disregarded.

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SECTION 2.10.          Temporary Notes.

Until definitive Notes are ready for delivery, the Issuer may prepare and the Trustee shall authenticate temporary Notes.  Temporary Notes shall be substantially in the form of definitive Notes but may have variations that the Issuer considers appropriate for temporary Notes.  Without unreasonable delay, the Issuer shall prepare and the Trustee shall authenticate definitive Notes in exchange for temporary Notes.  Until such exchange, temporary Notes shall be entitled to the same rights, benefits and privileges as definitive Notes.  Notwithstanding the foregoing, so long as the Notes are represented by a Global Note, such Global Note may be in typewritten form.

SECTION 2.11.          Cancellation.

The Issuer at any time may deliver Notes to the Trustee for cancellation.  The Registrar and the Paying Agent shall forward to the Trustee any Notes surrendered to them for transfer, exchange or payment.  The Trustee, or at the direction of the Trustee, the Registrar or the Paying Agent (other than the Issuer or a Subsidiary), and no one else, shall cancel and, at the written direction of the Issuer, shall dispose of all Notes surrendered for transfer, exchange, payment or cancellation in accordance with its customary procedures.  Subject to Section 2.07, the Issuer may not issue new Notes to replace Notes that it has paid or delivered to the Trustee for cancellation.  If the Issuer or any Guarantor shall acquire any of the Notes, such acquisition shall not operate as a redemption or satisfaction of the Indebtedness represented by such Notes unless and until the same are surrendered to the Trustee for cancellation pursuant to this Section 2.11.

SECTION 2.12.          Defaulted Interest.

If the Issuer defaults in a payment of interest on the Notes, it shall pay the defaulted interest, plus (to the extent lawful) any interest payable on the defaulted interest, in any lawful manner.  The Issuer may pay the defaulted interest to the persons who are Holders on a subsequent special record date, which date shall be the fifteenth day next preceding the date fixed by the Issuer for the payment of defaulted interest or the next succeeding Business Day if such date is not a Business Day.  At least 15 days before any such subsequent special record date, the Issuer shall mail to each Holder, with a copy to the Trustee, a notice that states the subsequent special record date, the payment date and the amount of defaulted interest, and interest payable on such defaulted interest, if any, to be paid.

SECTION 2.13.          CUSIP and ISIN Numbers.

The Issuer in issuing the Notes may use “CUSIP” or “ISIN” numbers, and if so, the Trustee shall use the “CUSIP” or “ISIN” numbers in notices of redemption or exchange as a convenience to Holders; provided, however, that any such notice may state that no representation is made as to the correctness or accuracy of the “CUSIP” or “ISIN” numbers printed in the notice or on the Notes, and that reliance may be placed only on the other identification numbers printed on the Notes.  The Issuer will promptly notify the Trustee of any change in the “CUSIP” or “ISIN” numbers.

SECTION 2.14.          Deposit of Moneys.

Subject to Section 2 of the Notes, prior to 10:00 a.m. New York City time on each Interest Payment Date, Maturity Date, Redemption Date, Change of Control Payment Date and Net Proceeds Payment Date, the Issuer shall have deposited with the Paying Agent in immediately available funds money sufficient to make cash payments, if any, due on such Interest Payment Date, Maturity Date, Redemption Date, Change of Control Payment Date and Net Proceeds Payment Date, as the case may be, in a timely manner which permits the Paying Agent to remit payment to the Holders on such Interest Payment Date, Maturity Date, Redemption Date, Change of Control Payment Date and Net Proceeds Payment Date, as the case may be.

SECTION 2.15.          Book-Entry Provisions for Global Notes.

(a)           The Global Notes initially shall (i) be registered in the name of the Depository or the nominee of such Depository, (ii) be delivered to the Trustee as custodian for such Depository and (iii) bear legends as set forth in Exhibit B, as applicable.

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Members of, or participants in, the Depository (“Participants”) shall have no rights under this Indenture with respect to any Global Note held on their behalf by the Depository, or the Trustee as its custodian, or under the Global Note, and the Depository may be treated by the Issuer, the Trustee and any agent of the Issuer or the Trustee as the absolute owner of the Global Note for all purposes whatsoever.  Notwithstanding the foregoing, nothing herein shall prevent the Issuer, the Trustee or any agent of the Issuer or the Trustee from giving effect to any written certification, proxy or other authorization furnished by the Depository or impair, as between the Depository and Participants, the operation of customary practices governing the exercise of the rights of a Holder of any Note.

(b)           Transfers of Global Notes shall be limited to transfers in whole, but not in part, to the Depository, its successors or their respective nominees.  Interests of beneficial owners in the Global Notes may be transferred or exchanged for Physical Notes in accordance with the rules and procedures of the Depository and the provisions of Section 2.16.  In addition, Physical Notes shall be transferred to all beneficial owners in exchange for their beneficial interests in Global Notes if (i) the Depository notifies the Issuer that it is unwilling or unable to act as Depository for any Global Note, the Issuer so notifies the Trustee in writing and a successor Depository is not appointed by the Issuer within 90 days of such notice, (ii) the Issuer, at its option, notifies the Trustee in writing that it elects to cause the issuance of the Notes in the form of Physical Notes under this Indenture, or (iii) a Default or Event of Default has occurred and is continuing and the Registrar has received a written request from any owner of a beneficial interest in a Global Note to issue Physical Notes.  Upon any issuance of a Physical Note in accordance with this Section 2.15(b) the Trustee is required to register such Physical Note in the name of, and cause the same to be delivered to, such person or persons (or the nominee of any thereof).  All such Physical Notes shall bear the applicable legends, if any.

(c)           In connection with any transfer or exchange of a portion of the beneficial interest in a Global Note to beneficial owners pursuant to paragraph (b) of this Section 2.15, the Registrar shall (if one or more Physical Notes are to be issued) reflect on its books and records the date and a decrease in the principal amount of such Global Note in an amount equal to the principal amount of the beneficial interest in the Global Note to be transferred, and the Issuer shall execute, and the Trustee shall authenticate and deliver, one or more Physical Notes of authorized denominations in an aggregate principal amount equal to the principal amount of the beneficial interest in the Global Note so transferred.

(d)           In connection with the transfer of a Global Note as an entirety to beneficial owners pursuant to paragraph (b) of this Section 2.15, such Global Note shall be deemed to be surrendered to the Trustee for cancellation, and (i) the Issuer shall execute and (ii) the Trustee shall upon written instructions from the Issuer authenticate and deliver, to each beneficial owner identified by the Depository in exchange for its beneficial interest in such Global Note, an equal aggregate principal amount of Physical Notes of authorized denominations.

(e)           Any Physical Note constituting a Restricted Security delivered in exchange for an interest in a Global Note pursuant to paragraph (b) or (c) of this Section 2.15 shall, except as otherwise provided by Section 2.16, bear the Private Placement Legend.

(f)            The Holder of any Global Note may grant proxies and otherwise authorize any Person, including Participants and Persons that may hold interests through Participants, to take any action which a Holder is entitled to take under this Indenture or the Notes.

SECTION 2.16.          Special Transfer and Exchange Provisions.

(a)           Transfers to Non-QIB Institutional Accredited Investors.  The following provisions shall apply with respect to the registration of any proposed transfer of a Restricted Security to any Institutional Accredited Investor which is not a QIB:

(i)      the Registrar shall register the transfer of any Restricted Security, whether or not such Note bears the Private Placement Legend, if (x) the requested transfer is after the first anniversary of the Issue Date; provided, however, that neither the Issuer nor any Affiliate of the Issuer has held any beneficial interest in such Note, or portion thereof, at any time on or prior to the first anniversary of the Issue Date or (y) the proposed transferee has delivered to the Registrar a certificate substantially in the form of Exhibit C

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hereto and any legal opinions and certifications as may be reasonably requested by the Trustee and the Issuer;

(ii)     if the proposed transferee is a Participant and the Notes to be transferred consist of Physical Notes which after transfer are to be evidenced by an interest in the IAI Global Note, upon receipt by the Registrar of the Physical Note and (x) written instructions given in accordance with the Depository’s and the Registrar’s procedures and (y) the certificate, if required, referred to in clause (y) of paragraph (i) above (and any legal opinion or other certifications), the Registrar shall register the transfer and reflect on its books and records the date and an increase in the principal amount of the IAI Global Note in an amount equal to the principal amount of Physical Notes to be transferred, and the Registrar shall cancel the Physical Notes so transferred; and

(iii)    if the proposed transferor is a Participant seeking to transfer an interest in a Global Note, upon receipt by the Registrar of (x) written instructions given in accordance with the Depository’s and the Registrar’s procedures and (y) the certificate, if required, referred to in clause (y) of paragraph (i) above, the Registrar shall register the transfer and reflect on its books and records the date and (A) a decrease in the principal amount of the Global Note from which such interests are to be transferred in an amount equal to the principal amount of the Notes to be transferred and (B) an increase in the principal amount of the IAI Global Note in an amount equal to the principal amount of the Notes to be transferred.

(b)           Transfers to QIBs.  The following provisions shall apply with respect to the registration of any proposed transfer of a Restricted Security to a QIB:

(i)      the Registrar shall register the transfer of any Restricted Security, whether or not such Note bears the Private Placement Legend, if (x) the requested transfer is after the first anniversary of the Issue Date; provided, however, that neither the Issuer nor any Affiliate of the Issuer has held any beneficial interest in such Note, or portion thereof, at any time on or prior to the first anniversary of the Issue Date or (y) such transfer is being made by a proposed transferor who has checked the box provided for on the applicable Global Note stating, or has otherwise advised the Issuer and the Registrar in writing, that the sale has been made in compliance with the provisions of Rule 144A to a transferee who has signed the certification provided for on the applicable Global Note stating, or has otherwise advised the Issuer and the Registrar in writing, that it is purchasing the Note for its own account or an account with respect to which it exercises sole investment discretion and that it and any such account is a QIB within the meaning of Rule 144A, and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that it has received such information regarding the Issuer as it has requested pursuant to Rule 144A or has determined not to request such information and that it is aware that the transferor is relying upon its foregoing representations in order to claim the exemption from registration provided by Rule 144A;

(ii)     if the proposed transferee is a Participant and the Notes to be transferred consist of Physical Notes which after transfer are to be evidenced by an interest in the 144A Global Note, upon receipt by the Registrar of the Physical Note and written instructions given in accordance with the Depository’s and the Registrar’s procedures, the Registrar shall register the transfer and reflect on its book and records the date and an increase in the principal amount of the 144A Global Note in an amount equal to the principal amount of Physical Notes to be transferred, and the Registrar shall cancel the Physical Notes so transferred; and

(iii)    if the proposed transferor is a Participant seeking to transfer an interest in the IAI Global Note or the Regulation S Global Note, upon receipt by the Registrar of written instructions given in accordance with the Depository’s and the Registrar’s procedures, the Registrar shall register the transfer and reflect on its books and records the date and (A) a decrease in the principal amount of the IAI Global Note or the Regulation S Global Note, as the case may be, in an amount equal to the principal amount of the Notes to be transferred and (B) an increase in the principal amount of the 144A Global Note in an amount equal to the principal amount of the Notes to be transferred.

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(c)           Transfers of Interests in the Temporary Regulation S Global Note.  The following provisions shall apply with respect to the registration of any proposed transfer of interests in the Temporary Regulation S Global Note:

(i)      the Registrar shall register the transfer of an interest in the Temporary Regulation S Global Note, whether or not such Global Note bears the Private Placement Legend if the proposed transferor has delivered to the Registrar a certificate substantially in the form of Exhibit E stating, among other things, that the proposed transferee is a Non-U.S. Person (except for a transfer to an Initial Purchaser);

(ii)     if the proposed transferee is a Participant, upon receipt by the Registrar of the documents referred to in clause (i) above, if required, and instructions given in accordance with the Depository’s and the Registrar’s procedures, the Registrar shall reflect on its books and records the date and amount of such transfer of an interest in the Temporary Regulation S Global Note.

(d)           Transfers to Non-U.S. Persons.  The following provisions shall apply with respect to any transfer of a Restricted Security to a Non-U.S. Person under Regulation S:

(i)      the Registrar shall register any proposed transfer of a Restricted Security to a Non-U.S. Person upon receipt of a certificate substantially in the form of Exhibit D from the proposed transferor and such certifications, legal opinions and other information as the Trustee or the Issuer may reasonably request; and

(ii)     (a) if the proposed transferor is a Participant holding a beneficial interest in the Rule 144A Global Note or the IAI Global Note or the Note to be transferred consists of Physical Notes, upon receipt by the Registrar of (x) the documents required by paragraph (i) and (y) instructions in accordance with the Depository’s and the Registrar’s procedures, the Registrar shall reflect on its books and records the date and a decrease in the principal amount of the Rule 144A Global Note or the IAI Global Note, as the case may be, in an amount equal to the principal amount of the beneficial interest in the Rule 144A Global Note or the IAI Global Note, as the case may be, to be transferred or cancel the Physical Notes to be transferred, and (b) if the proposed transferee is a Participant, upon receipt by the Registrar of instructions given in accordance with the Depository’s and the Registrar’s procedures, the Registrar shall reflect on its books and records the date and an increase in the principal amount of the Permanent Regulation S Global Note in an amount equal to the principal amount of the Rule 144A Global Note, the IAI Global Note or the Physical Notes, as the case may be, to be transferred.

(e)           Exchange Offer.  Upon the occurrence of the Exchange Offer in accordance with the Registration Rights Agreement, the Issuer shall issue and, upon receipt of an Authentication Order in accordance with Section 2.02, the Trustee shall authenticate one or more Global Notes and/or Physical Notes not bearing the Private Placement Legend in an aggregate principal amount equal to the principal amount of the beneficial interests in the Initial Global Notes or Physical Notes, as the case may be, tendered for acceptance in accordance with the Exchange Offer and accepted for exchange in the Exchange Offer.

(f)            Restrictions on Transfer and Exchange of Global Notes.  Notwithstanding any other provisions of this Indenture, a Global Note may not be transferred as a whole except by the Depository to a nominee of the Depository or by a nominee of the Depository to the Depository or another nominee of the Depository or by the Depository or any such nominee to a successor Depository or a nominee of such successor Depository.

(g)           Private Placement Legend.  Upon the transfer, exchange or replacement of Notes not bearing the Private Placement Legend unless otherwise required by applicable law, the Registrar shall deliver Notes that do not bear the Private Placement Legend.  Upon the transfer, exchange or replacement of Notes bearing the Private Placement Legend, the Registrar shall deliver only Notes that bear the Private Placement Legend unless (i) there is delivered to the Trustee an Opinion of Counsel reasonably satisfactory to the Issuer and the Trustee to the effect that neither such legend nor the related restrictions on transfer are required in order to maintain compliance with the provisions of the Securities Act or (ii) such Note has been offered and sold (including pursuant to the Exchange Offer) pursuant to an effective registration statement under the Securities Act.

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(h)           General.  By its acceptance of any Note bearing the Private Placement Legend, each Holder of such a Note acknowledges the restrictions on transfer of such Note set forth in this Indenture and in the Private Placement Legend and agrees that it will transfer such Note only as provided in this Indenture.

The Registrar shall retain copies of all letters, notices and other written communications received pursuant to Section 2.15 or Section 2.16.  The Issuer shall have the right to inspect and make copies of all such letters, notices or other written communications at any reasonable time upon the giving of reasonable written notice to the Registrar.

The Trustee shall have no obligation or duty to monitor, determine or inquire as to compliance with any restrictions on transfer imposed under this Indenture or under applicable law with respect to any transfer of any interest in any Note (including any transfers between or among Depository Participants or beneficial owners of interests in any Global Note) other than to require delivery of such certificates and other documentation or evidence as are expressly required by, and to do so if and when expressly required by the terms of, this Indenture, and to examine the same to determine substantial compliance as to form with the express requirements hereof.

The Trustee shall have no responsibility for the actions or omissions of the Depository, or the accuracy of the books and records of the Depository.

(i)            Cancellation and/or Adjustment of Global Note.  At such time as all beneficial interests in a particular Global Note have been exchanged for Physical Notes or a particular Global Note has been redeemed, repurchased or canceled in whole and not in part, each such Global Note shall be returned to or retained and canceled by the Trustee in accordance with Section 2.11 hereof.  At any time prior to such cancellation, if any beneficial interest in a Global Note is exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Note or for Physical Notes, the principal amount of Notes represented by such Global Note shall be reduced accordingly and an endorsement shall be made on such Global Note by the Trustee or by the Depository at the direction of the Trustee to reflect such reduction; and if the beneficial interest is being exchanged for or transferred to a Person who will take delivery thereof in the form of a beneficial interest in another Global Note, such other Global Note shall be increased accordingly and an endorsement shall be made on such Global Note by the Trustee or by the Depository at the direction of the Trustee to reflect such increase.

ARTICLE THREE

REDEMPTION

SECTION 3.01.          Notices to Trustee.

If the Issuer elects to redeem Notes pursuant to Section 5 of the Notes, it shall notify the Trustee in writing of the Redemption Date, the Redemption Price and the principal amount of Notes to be redeemed.  The Issuer shall give notice of redemption to the Trustee at least 30 days but not more than 60 days before the Redemption Date, together with such documentation and records as shall enable the Trustee to select the Notes to be redeemed.

SECTION 3.02.          Selection of Notes To Be Redeemed.

If less than all of the Notes are to be redeemed at any time pursuant to Section 5 of the Notes, the Trustee will select Notes for redemption as follows:

(x)            if the Notes are listed on a national securities exchange, in compliance with the requirements of the principal national securities exchange on which the Notes are listed; or

(y)           if the Notes are not so listed, on a pro rata basis, by lot or by such method as the Trustee shall deem fair and appropriate;

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provided that, in the case of such redemption pursuant to Section 5(c) of the Notes, the Trustee will select the Notes on a pro rata basis or on as nearly a pro rata basis as practicable (subject to the procedures of the Depository) unless that method is otherwise prohibited.

No Notes of $1,000 or less shall be redeemed in part.

SECTION 3.03.          Notice of Redemption.

At least 30 days but not more than 60 days before a Redemption Date, the Issuer shall mail a notice of redemption by first class mail, postage prepaid, to each Holder whose Notes are to be redeemed at its registered address (except that a notice issued in connection with a redemption referred to in Section 8.01 or 8.02 may be more than 60 days before such Redemption Date).  At the Issuer’s request delivered at least 5 days before such notice is to be given (unless a shorter period shall be acceptable to the Trustee), the Trustee shall forward the notice of redemption in the Issuer’s name and at the Issuer’s expense.  Each notice for redemption shall identify the Notes (including the CUSIP or ISIN number) to be redeemed and shall state:

(1)           the Redemption Date;

(2)           the Redemption Price and the amount of accrued interest, if any, to be paid;

(3)           the name and address of the Paying Agent;

(4)           that Notes called for redemption must be surrendered to the Paying Agent to collect the Redemption Price plus accrued interest, if any;

(5)           that, unless the Issuer defaults in making the redemption payment, interest on Notes called for redemption ceases to accrue on and after the Redemption Date, and the only remaining right of the Holders of such Notes is to receive payment of the Redemption Price upon surrender to the Paying Agent of the Notes redeemed;

(6)           if any Note is being redeemed in part, the portion of the principal amount of such Note to be redeemed and that, after the Redemption Date, and upon surrender and cancellation of such Note, a new Note or Notes in aggregate principal amount equal to the unredeemed portion thereof will be issued;

(7)           if fewer than all the Notes are to be redeemed, the identification of the particular Notes (or portion thereof) to be redeemed, as well as the aggregate principal amount of Notes to be redeemed and the aggregate principal amount of Notes to be outstanding after such partial redemption; and

(8)           the Section of the Notes or this Indenture, as applicable, pursuant to which the Notes are to be redeemed.

The notice, if mailed in a manner herein provided, shall be conclusively presumed to have been given, whether or not the Holder receives such notice.  In any case, failure to give such notice by mail or any defect in the notice to the Holder of any Note designated for redemption in whole or in part shall not affect the validity of the proceedings for the redemption of any other Note.  Except with respect to redemption pursuant to Section 5(c) of the Notes, notices of redemption may not be conditional.  Notice of any redemption pursuant to Section 5(c) of the Notes may be given prior to the completion of the related Qualified Equity Offering, and any such redemption or notice may, at the Issuer’s discretion, be subject to the closing of such Qualified Equity Offering.

SECTION 3.04.          Effect of Notice of Redemption.

Once notice of redemption is mailed in accordance with Section 3.03, Notes called for redemption become due and payable on the Redemption Date and at the Redemption Price plus accrued interest, if any.  Upon surrender to the Trustee or Paying Agent, such Notes called for redemption shall be paid at the Redemption Price (which shall include accrued interest thereon to, but not including, the Redemption Date), but installments of interest, the maturity

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of which is on or prior to the Redemption Date, shall be payable to Holders of record at the close of business on the relevant Record Dates.  On and after the Redemption Date interest shall cease to accrue on Notes or portions thereof called for redemption unless the Issuer shall have not complied with its obligations pursuant to Section 3.05.

SECTION 3.05.          Deposit of Redemption Price.

On or before 10:00 a.m. New York time on the Redemption Date, the Issuer shall deposit with the Paying Agent U.S. Legal Tender sufficient to pay the Redemption Price plus accrued and unpaid interest, if any, of all Notes to be redeemed on that date.

If the Issuer complies with the preceding paragraph, then, unless the Issuer defaults in the payment of such Redemption Price plus accrued interest, if any, interest on the Notes to be redeemed will cease to accrue on and after the applicable Redemption Date, whether or not such Notes are presented for payment.

SECTION 3.06.          Notes Redeemed in Part.

If any Note is to be redeemed in part only, the notice of redemption that relates to such Note shall state the portion of the principal amount thereof to be redeemed.  A new Note or Notes in principal amount equal to the unredeemed portion of the original Note or Notes shall be issued in the name of the Holder thereof upon surrender and cancellation of the original Note or Notes.

The provisions of this Article Three notwithstanding, the Issuer may acquire Notes by means other than a redemption, whether pursuant to an issuer tender offer, open market purchase or otherwise, so long as the acquisition does not otherwise violate the terms of this Indenture.

ARTICLE FOUR

COVENANTS

SECTION 4.01.          Payment of Notes.

The Issuer shall pay the principal of (and premium, if any) and interest on the Notes in the manner provided in the Notes, the Registration Rights Agreement and this Indenture.  An installment of principal of, or interest on, the Notes shall be considered paid on the date it is due if the Trustee or Paying Agent (other than the Issuer or an Affiliate thereof) holds on that date U.S. Legal Tender designated for and sufficient to pay the installment.  Interest on the Notes will be computed on the basis of a 360-day year comprised of twelve 30-day months.

The Issuer shall pay interest on overdue principal (including, without limitation, post petition interest in a proceeding under any Bankruptcy Law), and overdue interest, to the extent lawful, at the same rate per annum borne by the Notes.

SECTION 4.02.          Maintenance of Office or Agency.

The Issuer shall maintain in the Borough of Manhattan, The City of New York, the office or agency required under Section 2.03 (which may be an office of the Trustee or an affiliate of the Trustee or Registrar).  The Issuer shall give prompt written notice to the Trustee of the location, and any change in the location, of such office or agency.  If at any time the Issuer shall fail to maintain any such required office or agency or shall fail to furnish the Trustee with the address thereof, such presentations, surrenders, notices and demands may be made or served at the address of the Trustee set forth in Section 12.02.

The Issuer may also from time to time designate one or more other offices or agencies where the Notes may be presented or surrendered for any or all such purposes and may from time to time rescind such designations.  The Issuer will give prompt written notice to the Trustee of any such designation or rescission and of any change in the location of any such other office or agency.

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The Issuer hereby initially designates the office or agency of the Trustee located in The Borough of Manhattan, The City of New York, as such office of the Issuer in accordance with Section 2.03.

SECTION 4.03.          Corporate Existence.

Except as otherwise permitted by Article Five, the Issuer shall do or cause to be done all things necessary to preserve and keep in full force and effect its corporate existence and the corporate, partnership or other existence of each of its Restricted Subsidiaries in accordance with the respective organizational documents of each such Restricted Subsidiary and the material rights (charter and statutory) and material franchises of the Issuer and each of its Restricted Subsidiaries; provided, however, that the Issuer shall not be required to preserve any such right, franchise or corporate existence with respect to itself or any Restricted Subsidiary if the Board of Directors shall determine that the preservation thereof is no longer desirable in the conduct of the business of the Issuer and its Restricted Subsidiaries, taken as a whole, and that the loss thereof is not adverse in any material respect to the Holders of the Notes.

SECTION 4.04.          Payment of Taxes.

The Issuer and the Guarantors shall, and shall cause each of the Restricted Subsidiaries to, pay or discharge or cause to be paid or discharged, before the same shall become delinquent, (a) all material taxes, assessments and governmental charges levied or imposed upon it or any of the Restricted Subsidiaries or upon the income, profits or property of it or any of the Restricted Subsidiaries and (b) all lawful claims for labor, materials and supplies which, in each case, if unpaid, might by law become a material liability or Lien upon the property of it or any of the Restricted Subsidiaries; provided, however, that the Issuer and the Guarantors shall not be required to pay or discharge or cause to be paid or discharged any such tax, assessment, charge or claim whose amount the applicability or validity is being contested in good faith by appropriate actions and for which appropriate provision has been made.

SECTION 4.05.          Suspension of Covenants.

(a)           During any period of time that (1) the Notes have Investment Grade Ratings from both Rating Agencies and (2) no Default has occurred and is continuing under this Indenture (the occurrence of the events described in the foregoing clauses (1) and (2) being collectively referred to as a “Covenant Suspension Event” and the date thereof being referred to as the “Suspension Date”) then, Sections 4.10, 4.11, 4.13, 4.14, 4.15, 4.17 and 5.01(a)(3) (collectively, the “Suspended Covenants”) will not be applicable to the Notes.  Following any Suspension Date and prior to a corresponding Reversion Date, the Issuer may not designate any Subsidiaries as Unrestricted Subsidiaries pursuant to Section 4.19.  In the event that the Issuer and its Restricted Subsidiaries are not subject to the Suspended Covenants under this Indenture for any period of time as a result of the foregoing, and on any subsequent date (the “Reversion Date”) one or both of the Rating Agencies withdraw their Investment Grade Rating or downgrade the rating assigned to the Notes below an Investment Grade Rating, then the Issuer and its Restricted Subsidiaries will thereafter again be subject to the Suspended Covenants under this Indenture with respect to future events.  The period of time between the Suspension Date and the Reversion Date is referred to as the “Suspension Period.”  Additionally, upon the occurrence of a Covenant Suspension Event, the amount of Net Available Proceeds shall be reset to zero.

(b)           Notwithstanding the foregoing, in the event of any such reinstatement, no action taken or omitted to be taken by the Issuer or any of its Restricted Subsidiaries prior to such reinstatement will give rise to a Default or Event of Default under this Indenture; provided that (1) with respect to Restricted Payments made after such reinstatement, the amount of Restricted Payments made will be calculated as though the Section 4.11 had been in effect prior to, but not during, the Suspension Period (and, for avoidance of doubt, all Consolidated Net Income and other amounts attributable to the Suspension Period that would otherwise increase the amount of the Restricted Payments Basket shall be excluded in determining the amount of the Restricted Payments Basket following the Reversion Date); and (2) all Indebtedness incurred, or Disqualified Equity Interests issued, during the Suspension Period will be classified to have been incurred or issued pursuant to Section 4.10(b)(3).

(c)           The Issuer shall give the Trustee and the Holders prompt notice of each Suspension Date and each Reversion Date.

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SECTION 4.06.          Compliance Certificate; Notice of Default.

(a)           The Issuer shall deliver to the Trustee, within 120 days after the close of each fiscal year, an Officers’ Certificate stating that a review of the activities of the Issuer and its Subsidiaries has been made under the supervision of the signing Officers with a view to determining whether the Issuer and the Guarantors have kept, observed, performed and fulfilled their obligations under this Indenture and further stating, as to each such Officer signing such certificate, that to the best of such Officer’s knowledge, the Issuer and the Guarantors during such preceding fiscal year has kept, observed, performed and fulfilled each and every such covenant and no Default occurred during such year and at the date of such certificate there is no Default that has occurred and is continuing or, if such signers do know of such Default, the certificate shall specify such Default and what action, if any, the Issuer is taking or proposes to take with respect thereto.  The Officers’ Certificate shall also notify the Trustee should the Issuer elect to change the manner in which it fixes the fiscal year end.

(b)           The Issuer shall deliver to the Trustee, upon any Officer of the Issuer becoming aware of the occurrence of any Default, an Officers’ Certificate specifying the Default and what action, if any, the Issuer is taking or proposes to take with respect thereto.

SECTION 4.07.          Business Activities.

The Issuer will not, and will not permit any Restricted Subsidiary to, engage in any business other than a Permitted Business.

SECTION 4.08.          Waiver of Stay, Extension or Usury Laws.

The Issuer and each Guarantor covenants (to the extent permitted by applicable law) that it will not at any time insist upon, plead, or in any manner whatsoever claim or take the benefit or advantage of, any stay or extension law or any usury law or other law that would prohibit or forgive such Issuer or such Guarantor from paying all or any portion of the principal of and/or interest on the Notes, wherever enacted, now or at any time hereafter in force, or which may affect the covenants or the performance of this Indenture, and (to the extent permitted by applicable law) each hereby expressly waives all benefit or advantage of any such law, and covenants that it will not hinder, delay or impede the execution of any power herein granted to the Trustee, but will suffer and permit the execution of every such power as though no such law had been enacted.

SECTION 4.09.          Change of Control.

Upon the occurrence of any Change of Control, unless the Issuer has previously or concurrently mailed a redemption notice with respect to all the outstanding Notes pursuant to Section 5 of the Notes, each Holder will have the right to require that the Issuer purchase all or any part (equal to $1,000 or an integral multiple of $1,000) of that Holder’s Notes pursuant to a Change of Control Offer (the “Change of Control Offer”).  In the Change of Control Offer, the Issuer will offer to pay an amount in cash (the “Change of Control Purchase Price”) equal to 101% of the aggregate principal amount of the Notes to be purchased, plus accrued and unpaid interest thereon, if any, to the date of purchase.  Within 30 days following any Change of Control, the Issuer will mail, or cause to be mailed, a notice to each Holder describing the transaction or transactions that constitute the Change of Control and offering to purchase Notes on the date (the “Change of Control Payment Date”) specified in such notice, which date shall be a Business Day no earlier than 30 days and no later than 60 days from the date such notice is mailed, pursuant to the procedures described below.  Such notice shall state:

(1)           that the Change of Control Offer is being made pursuant to this Section 4.09 and that all Notes tendered and not withdrawn will be accepted for payment;

(2)           the purchase price (including the amount of accrued interest) and the Change of Control Payment Date;

(3)           that any Note not tendered will continue to accrue interest;

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(4)           that, unless the Issuer defaults in making payment therefor, any Note accepted for payment pursuant to the Change of Control Offer shall cease to accrue interest after the Change of Control Payment Date;

(5)           that Holders electing to have a Note purchased pursuant to a Change of Control Offer will be required to surrender the Note, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Note completed, to the Paying Agent at the address specified in the notice prior to the close of business on the third Business Day prior to the Change of Control Payment Date;

(6)           that Holders will be entitled to withdraw their election if the Paying Agent receives, not later than the second Business Day prior to the Change of Control Payment Date, a telegram, facsimile transmission or letter setting forth the name of the Holder, the principal amount of the Notes the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Note purchased;

(7)           that Holders whose Notes are purchased only in part will be issued new Notes in a principal amount equal to the unpurchased portion of the Notes surrendered (equal to $1,000 or an integral multiple of $1,000); and

(8)           the circumstances and relevant facts regarding such Change of Control.

On or before the Change of Control Payment Date, the Issuer will, to the extent lawful:

(i)            accept for payment all Notes or portions thereof properly tendered pursuant to the Change of Control Offer;

(ii)           deposit with the Paying Agent U.S. Legal Tender sufficient to pay the Change of Control Purchase Price in respect of all Notes or portions thereof so tendered; and

(iii)          deliver or cause to be delivered to the Trustee the Notes so accepted together with an Officers’ Certificate stating the aggregate principal amount of Notes or portions thereof being purchased by the Issuer.

The Paying Agent will promptly mail to each Holder of Notes so tendered the Change of Control Purchase Price for such Notes, and the Trustee will promptly authenticate and mail (or cause to be transferred by book entry) to each Holder a new Note equal in principal amount to any unpurchased portion of the Notes surrendered, if any; provided that each such new Note will be in a principal amount of $1,000 or an integral multiple of $1,000.

The Issuer will publicly announce the results of the Change of Control Offer on or as soon as practicable after the Change of Control Payment Date.

The Issuer will not be required to make a Change of Control Offer upon a Change of Control if a third party makes the Change of Control Offer in the manner, at the times and otherwise in compliance with the requirements set forth in this Indenture applicable to a Change of Control Offer made by the Issuer and purchases all Notes properly tendered and not withdrawn under such Change of Control Offer.

Notwithstanding anything to the contrary herein, a Change of Control Offer may be made in advance of a Change of Control, conditional upon such Change of Control, if a definitive agreement is in place for the Change of Control at the time of making of the Change of Control Offer.

The Issuer shall cause the Change of Control Offer to remain open for at least 20 Business Days or for such longer period as may be required by law.  The Issuer will comply with applicable tender offer rules, including the requirements of Rule 14e-1 under the Exchange Act and any other securities laws and regulations thereunder to the extent such laws and regulations are applicable in connection with a Change of Control Offer.  To the extent the provisions of any applicable securities laws or regulations conflict with the provisions of this Section 4.09, the Issuer

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will not be deemed to have breached their obligations under this Section 4.09 by virtue of complying with such laws or regulations.

SECTION 4.10.          Limitations on Additional Indebtedness.

(a)           The Issuer will not, and will not permit any Restricted Subsidiary to, directly or indirectly, incur any Indebtedness; provided that the Issuer or any Guarantor may incur additional Indebtedness if, after giving effect thereto, the Consolidated Interest Coverage Ratio would be at least 2.00 to 1.00 (the “Coverage Ratio Exception”).

(b)           Notwithstanding Section 4.10(a), each of the following shall be permitted (the “Permitted Indebtedness”):

(1)           Indebtedness under Credit Facilities in an aggregate amount at any time outstanding not to exceed $230.0 million;

(2)           the Notes issued on the Issue Date and the Note Guarantees and the Exchange Notes and the Note Guarantees in respect thereof to be issued pursuant to the Registration Rights Agreement;

(3)           Indebtedness of the Issuer and the Restricted Subsidiaries to the extent outstanding on the Issue Date (other than Indebtedness referred to in clauses (1) and (2) above or (5) below), after giving effect to the Transactions;

(4)           Indebtedness under Hedging Obligations entered into in the ordinary course of business for bona fide hedging purposes and not for the purpose of speculation that are designed to protect against fluctuations in interest rates, foreign currency exchange rates and commodity prices;

(5)           (x) Indebtedness of the Issuer owed to a Restricted Subsidiary and Indebtedness of any Restricted Subsidiary owed to the Issuer or any other Restricted Subsidiary and (y) guarantees by the Issuer or any Restricted Subsidiary of any Indebtedness of the Issuer or any other Restricted Subsidiary that is permitted to be incurred by another provision of this covenant and could have been incurred (in compliance with this covenant) by the Person so guaranteeing such Indebtedness; provided, however, that upon any such Restricted Subsidiary ceasing to be a Restricted Subsidiary or such Indebtedness being owed to any Person other than the Issuer or a Restricted Subsidiary, the Issuer or such Restricted Subsidiary, as applicable, shall be deemed to have incurred Indebtedness not permitted by this clause (5);

(6)           Indebtedness in respect of bid, performance, bank guarantees or surety bonds issued for the account of the Issuer or any Restricted Subsidiary in the ordinary course of business, including guarantees or obligations of the Issuer or any Restricted Subsidiary with respect to letters of credit supporting such bid, performance or surety obligations (in each case other than for an obligation for money borrowed) and reimbursement obligations with respect to letters of credit issued in the ordinary course of business in respect of workers’ compensation claims or other similar obligations;

(7)           Purchase Money Indebtedness and Capitalized Lease Obligations incurred by the Issuer or any Restricted Subsidiary, and Refinancing Indebtedness thereof, in an aggregate amount not to exceed at any time outstanding $25.0 million;

(8)           Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of business; provided, however, that such Indebtedness is extinguished within fifteen Business Days of incurrence;

(9)           Indebtedness arising in connection with endorsement of instruments for deposit or other commercial banking arrangements to manage cash balances, in each case, in the ordinary course of business;

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(10)         Refinancing Indebtedness with respect to Indebtedness incurred pursuant to the Coverage Ratio Exception or clauses (2) or (3) above, this clause (10), or clauses (11) or (13) below;

(11)         Indebtedness of Foreign Subsidiaries; provided that at the time of incurrence of Indebtedness under this clause (11) and after giving effect thereto, Consolidated Interest Coverage Ratio of the Foreign Subsidiaries (calculated by replacing the references to the Issuer in the relevant definitions to all Foreign Subsidiaries) is at least 2.00 to 1.00;

(12)         Indebtedness of the Issuer or any Restricted Subsidiary in an aggregate amount not to exceed $25.0 million at any time outstanding;

(13)         (i) Acquired Indebtedness or (ii) Indebtedness the proceeds of which are used to fund the acquisition (including related transaction fees and expenses and any related refinancing of Acquired Indebtedness) of (x) the Equity Interests of any Person that becomes a Restricted Subsidiary or merges with or into a Restricted Subsidiary or the Issuer or (y) any assets by the Issuer or any Restricted Subsidiary; provided that after giving effect thereto and the transaction giving rise to such Acquired Indebtedness or Indebtedness,

(a)           the Issuer would be permitted to incur at least $1.00 of additional Indebtedness pursuant to the Coverage Ratio Exception; or

(b)           the Consolidated Interest Coverage Ratio of the Issuer and the Restricted Subsidiaries is equal to or greater than immediately prior to such transaction;

(14)         Indebtedness constituting indemnification, adjustment of purchase price, earnouts or similar obligations, in each case, incurred or assumed in connection with the disposition of any business, assets or a Subsidiary, other than guarantees of Indebtedness incurred by any Person acquiring all or any portion of such business, assets or a Subsidiary for the purpose of financing such acquisition; provided, that

(a)           such Indebtedness is not reflected on the balance sheet of the Issuer or any Restricted Subsidiary (excluding the footnotes thereto); and

(b)           the maximum assumable liability in respect of all such Indebtedness shall at no time exceed the gross proceeds including non-cash proceeds (the fair market value of such non-cash proceeds being measured at the time received and without giving effect to any subsequent changes in value) actually received by the Issuer and its Restricted Subsidiaries in connection with such disposition;

(15)         customer deposits and advance payments received in the ordinary course of business from customers for goods purchased in the ordinary course of business; and

(16)         Indebtedness consisting of (a) the financing of insurance premiums or (b) take-or-pay obligations contained in supply arrangements, in each case, incurred in the ordinary course of business.

(c)           For purposes of determining compliance with this Section 4.10, in the event that an item of Indebtedness meets the criteria of more than one of the categories of Permitted Indebtedness described in clauses (1) through (16) of Section 4.10(b) or is entitled to be incurred pursuant to the Coverage Ratio Exception, the Issuer shall, in its sole discretion, classify such item of Indebtedness and may divide and classify such Indebtedness in more than one of the types of Indebtedness described, except that Indebtedness incurred under the Credit Facilities on the Issue Date shall be deemed to have been incurred under clause (1) of Section 4.10(b) and may later reclassify any item of Indebtedness described in clauses (1) through (16) above (provided that at the time of reclassification it meets the criteria in such category or categories).  In addition, for purposes of determining any particular amount of Indebtedness under this Section 4.10, guarantees, Liens or letter of credit obligations supporting Indebtedness otherwise included in the determination of such particular amount shall not be included so long as incurred by a Person that could have incurred such Indebtedness.

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SECTION 4.11.          Limitations on Restricted Payments.

(a)           The Issuer will not, and will not permit any Restricted Subsidiary to, directly or indirectly, make any Restricted Payment if at the time of such Restricted Payment:

(1)           a Default shall have occurred and be continuing or shall occur as a consequence thereof;

(2)           the Issuer cannot incur $1.00 of additional Indebtedness pursuant to the Coverage Ratio Exception; or

(3)           the amount of such Restricted Payment, when added to the aggregate amount of all other Restricted Payments made after the Issue Date (other than Restricted Payments made pursuant to clause (2), (3), (4), (5), (6), (7), (8) or (9) of Section 4.11(b)), exceeds the sum (the “Restricted Payments Basket”) of (without duplication):

(a)           50% of Consolidated Net Income for the period (taken as one accounting period) commencing on the first day of the fiscal quarter in which the Issue Date occurs to and including the last day of the fiscal quarter ended immediately prior to the date of such calculation for which consolidated financial statements are available (or, if such Consolidated Net Income shall be a deficit, minus 100% of such aggregate deficit), plus

(b)           100% of the aggregate net proceeds, including cash and the Fair Market Value of property other than cash, received by the Issuer either (x) as contributions to the common equity of the Issuer after the Issue Date or (y) from the issuance and sale of Qualified Equity Interests after the Issue Date, other than any such proceeds which are used to redeem Notes in accordance with Section 5(c) of the Notes, plus

(c)           the aggregate amount by which Indebtedness (other than any Subordinated Indebtedness) incurred by the Issuer or any Restricted Subsidiary subsequent to the Issue Date is reduced on the Issuer’s balance sheet upon the conversion or exchange (other than by a Subsidiary of the Issuer) into Qualified Equity Interests (less the amount of any cash, or the fair value of assets, distributed by the Issuer or any Restricted Subsidiary upon such conversion or exchange), plus

(d)           in the case of the disposition or repayment of or return on any Investment that was treated as a Restricted Payment made after the Issue Date, an amount (to the extent not included in the computation of Consolidated Net Income) equal to 100% of the aggregate amount received by the Issuer or any Restricted Subsidiary in cash or other property (valued at the Fair Market Value thereof) as the return of capital with respect to such Investment, less the cost of the disposition of such Investment and net of taxes, plus

(e)           upon a Redesignation of an Unrestricted Subsidiary as a Restricted Subsidiary, the Fair Market Value of the Issuer’s proportionate interest in such Subsidiary immediately following such Redesignation to the extent such Investments reduced the Restricted Payments Basket or constituted a Permitted Investment and were not previously repaid or otherwise reduced.

(b)           The foregoing provisions will not prohibit:

(1)           the payment by the Issuer or any Restricted Subsidiary of any dividend within 60 days after the date of declaration thereof, if on the date of declaration the payment would have complied with the provisions of this Indenture;

(2)           the redemption of any Equity Interests of the Issuer or any Restricted Subsidiary in exchange for, or out of the proceeds of the substantially concurrent issuance and sale of, Qualified Equity Interests or from the substantially concurrent contribution to the common equity capital of the Issuer;

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(3)           the redemption of Subordinated Indebtedness of the Issuer or any Restricted Subsidiary (a) in exchange for, or out of the proceeds of the substantially concurrent issuance and sale of, Qualified Equity Interests or from the substantially concurrent contribution to the common equity capital of the Issuer; (b) in exchange for, or out of the proceeds of the substantially concurrent incurrence of, Refinancing Indebtedness permitted to be incurred under Section 4.10 and the other terms of this Indenture or (c) upon a Change of Control or in connection with an Asset Sale to the extent required by the agreement governing such Subordinated Indebtedness but only if the Issuer shall have complied with Section 4.09 and Section 4.13 and purchased all Notes validly tendered pursuant to the relevant offer prior to purchasing or repaying such Subordinated Indebtedness;

(4)           Restricted Payments which are used to redeem Equity Interests of the Issuer or Parent held by officers, directors, consultants or employees or former officers, directors, consultants or employees (or their transferees, estates or beneficiaries under their estates) of Parent or any of its Subsidiaries, upon their death, disability, retirement, severance or termination of employment or service; provided that the aggregate cash consideration paid for all such redemptions shall not exceed $3.0 million during any calendar year (with unused amounts in any calendar year being usable, without duplication, in subsequent calendar years, provided that not more than $5.0 million of unused amounts from previous calendar years may be utilized in any single calendar year);

(5)           payments, distributions, or Investments permitted pursuant to clauses (2), (3), (4) and (9) of Section 4.14(b);

(6)           repurchases of Equity Interests deemed to occur upon the exercise of stock options or warrants if the Equity Interests represent a portion of the exercise price thereof;

(7)           any payments made in connection with the consummation of the Transactions as described in the Offering Memorandum, including any loans or distributions to Parent to make such payments;

(8)           other Restricted Payments in an aggregate amount not to exceed $15.0 million;

(9)           the declaration and payment of dividends or other distributions to holders of any class or series of Disqualified Equity Interests or any Preferred Stock of any Restricted Subsidiary issued in accordance with Section 4.10 to the extent such dividends or distributions are included in Consolidated Interest Expense in calculating the Consolidated Interest Coverage Ratio; or

(10)         the declaration and payment of dividends on the Issuer’s common stock (or the payment of dividends to any direct or indirect parent entity to fund a payment of dividends on such entity’s common stock), following the first public offering of the Issuer’s common stock or the common stock of any of its direct or indirect parent companies after the Issue Date, of up to 6.0% per annum of the net cash proceeds received by or contributed to the Issuer in or from any such public offering, other than public offerings with respect to the Issuer’s common stock registered on Form S-4 or Form S-8;

provided that (a) in the case of any Restricted Payment pursuant to clauses (3), (8), (9) or (10) above, no Default shall have occurred and be continuing or occur as a consequence thereof and (b) to the extent the issuance and sale of Qualified Equity Interests or contributions to the common equity capital of the Issuer are used to make a payment pursuant to clause (2) or (3) above, such issuance and sale or contribution shall not increase the Restricted Payments Basket.

SECTION 4.12.          Limitations on Liens.

The Issuer shall not, and shall not permit any Restricted Subsidiary to, directly or indirectly, create, incur, assume or permit or suffer to exist any Lien of any nature whatsoever (other than Permitted Liens) against any assets of the Issuer or any Restricted Subsidiary (including Equity Interests of a Restricted Subsidiary), securing any

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Indebtedness, whether owned at the Issue Date or thereafter acquired, or any proceeds therefrom, or assign or otherwise convey any right to receive income or profits therefrom, unless contemporaneously therewith:

(1)           in the case of any Lien securing an obligation that ranks pari passu with the Notes or a Note Guarantee, effective provision is made to secure the Notes or such Note Guarantee, as the case may be, at least equally and ratably with or prior to such obligation with a Lien on the same assets of the Issuer or such Restricted Subsidiary, as the case may be; and

(2)           in the case of any Lien securing an obligation that is subordinated in right of payment to the Notes or a Note Guarantee, effective provision is made to secure the Notes or such Note Guarantee, as the case may be, with a Lien on the same assets of the Issuer or such Restricted Subsidiary, as the case may be, that is prior to the Lien securing such subordinated obligation,

in each case, for so long as such obligation is secured by such Lien.

SECTION 4.13.          Limitations on Asset Sales.

(a)           The Issuer will not, and will not permit any Restricted Subsidiary to, directly or indirectly, consummate any Asset Sale unless:

(1)           the Issuer or such Restricted Subsidiary receives consideration at the time of such Asset Sale at least equal to the Fair Market Value of the assets included in such Asset Sale; and

(2)           at least 75% of the total consideration received in such Asset Sale consists of cash or Cash Equivalents.

(b)           For purposes of clause (2) of Section 4.13(a), the following shall be deemed to be cash:

(1)           the amount (without duplication) of any Indebtedness (other than Subordinated Indebtedness) of the Issuer or such Restricted Subsidiary that is expressly assumed by the transferee in such Asset Sale and with respect to which the Issuer or such Restricted Subsidiary, as the case may be, is unconditionally released by the holder of such Indebtedness,

(2)           the amount of any securities received from such transferee that are within 365 days converted by the Issuer or such Restricted Subsidiary to cash (to the extent of the cash actually so received), and

(3)           the Fair Market Value of (i) any assets (other than securities) received by the Issuer or any Restricted Subsidiary to be used by it in a Permitted Business, (ii)  Equity Interests in a Person that is a Restricted Subsidiary or in a Person engaged in a Permitted Business that shall become a Restricted Subsidiary immediately upon the acquisition of such Person by the Issuer or (iii) a combination of (i) and (ii).

(c)           If at any time any non-cash consideration received by the Issuer or any Restricted Subsidiary of the Issuer, as the case may be, in connection with any Asset Sale is repaid or converted into or sold or otherwise disposed of for cash (other than interest received with respect to any such non-cash consideration), then the date of such repayment, conversion or disposition shall be deemed to constitute the date of an Asset Sale hereunder and the Net Available Proceeds thereof shall be applied in accordance with this Section 4.13.

(d)           If the Issuer or any Restricted Subsidiary engages in an Asset Sale, the Issuer or such Restricted Subsidiary shall, no later than 365 days following the consummation thereof, apply all or any of the Net Available Proceeds therefrom to:

(1)           repay obligations under the Credit Agreement, and in the case of any such repayment under any revolving credit facility, effect a permanent reduction in the availability under such revolving credit facility;

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(2)           repay any Indebtedness which was secured by the assets sold in such Asset Sale;

(3)           repay any Pari Passu Indebtedness that is secured by a Lien (to the extent of the value of the assets (excluding any assets also pledged to secure the Notes or any Note Guarantee pursuant to clause (1) of Section 4.12) secured by such Lien), which Lien is permitted by this Indenture;

(4)           repay any Indebtedness of a Restricted Subsidiary that is not a Guarantor, other than Indebtedness owed to the Issuer or another Restricted Subsidiary; and/or

(5)           (A) invest all or any part of the Net Available Proceeds thereof in the purchase of assets (other than securities) to be used by the Issuer or any Restricted Subsidiary in a Permitted Business, (B) acquire Equity Interests in a Person that is a Restricted Subsidiary or in a Person engaged in a Permitted Business that shall become a Restricted Subsidiary immediately upon the consummation of such acquisition, (C) make capital expenditures or (D) a combination of (A), (B) and/or (C);

provided that the Issuer and its Restricted Subsidiaries will be deemed to have complied with the provisions described in clause (5) of this paragraph if and to the extent that, within 365 days after the Asset Sale that generated the Net Available Proceeds, the Issuer or such Restricted Subsidiary has entered into and not abandoned or rejected a binding agreement to effect the provisions of clause (5) of this paragraph, and the Net Available Proceeds are applied as described in clause (5) of this paragraph within 180 days after the end of such 365-day period; provided that if any Net Available Proceeds are not so applied, then such Net Available Proceeds shall constitute Excess Proceeds (as defined below) on such 180th day.

The amount of Net Available Proceeds not applied or invested as provided in this paragraph will constitute “Excess Proceeds.”

(e)           When the aggregate amount of Excess Proceeds equals or exceeds $25.0 million, the Issuer will be required to make within 10 Business Days thereof, an offer to purchase from all Holders and, if applicable, redeem (or make an offer to do so) any Pari Passu Indebtedness of the Issuer the provisions of which require the Issuer to redeem such Indebtedness with the proceeds from any Asset Sales (or offer to do so), in an aggregate principal amount of Notes and such Pari Passu Indebtedness equal to the amount of such Excess Proceeds as follows:

(1)           the Issuer will (a) make an offer to purchase (a “Net Proceeds Offer”) to all Holders in accordance with the procedures set forth in this Indenture, and (b) redeem (or make an offer to do so) any such other Pari Passu Indebtedness, pro rata in proportion to the respective principal amounts of the Notes and such other Indebtedness required to be redeemed, the maximum principal amount of Notes and Pari Passu Indebtedness that may be redeemed out of the amount (the “Payment Amount”) of such Excess Proceeds;

(2)           the offer price for the Notes will be payable in cash in an amount equal to 100% of the principal amount of the Notes tendered pursuant to a Net Proceeds Offer, plus accrued and unpaid interest thereon, if any, to the date such Net Proceeds Offer is consummated (the “Offered Price”), in accordance with the procedures set forth in this Indenture and the redemption price for such Pari Passu Indebtedness (the “Pari Passu Indebtedness Price”) shall be as set forth in the related documentation governing such Indebtedness;

(3)           if the aggregate Offered Price of Notes validly tendered and not withdrawn by Holders thereof exceeds the pro rata portion of the Payment Amount allocable to the Notes, Notes to be purchased will be selected on a pro rata basis; and

(4)           upon completion of such Net Proceeds Offer in accordance with the foregoing provisions, the amount of Excess Proceeds with respect to which such Net Proceeds Offer was made shall be deemed to be zero.

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(f)            To the extent that the sum of the aggregate Offered Price of Notes tendered pursuant to a Net Proceeds Offer and the aggregate Pari Passu Indebtedness Price paid to the holders of such Pari Passu Indebtedness is less than the Payment Amount relating thereto (such shortfall constituting a “Net Proceeds Deficiency”), the Issuer may use the Net Proceeds Deficiency, or a portion thereof, for general corporate purposes, subject to the provisions of this Indenture.

(g)           Pending the final application of any Net Available Proceeds pursuant to this covenant, the holder of such Net Available Proceeds may apply such Net Available Proceeds temporarily to reduce Indebtedness outstanding under a revolving credit facility or otherwise invest such Net Available Proceeds in Cash Equivalents.

(h)           Upon the commencement of a Net Proceeds Offer, the Issuer shall send, by first class mail, a notice to the Trustee and to each Holder at is registered address.  The notice shall contain all instructions and materials necessary to enable such Holder to tender Notes pursuant to the Net Proceeds Offer.  Any Net Proceeds Offer shall be made to all Holders.  The notice, which shall govern the terms of the Net Proceeds Offer, shall state:

(1)           that the Net Proceeds Offer is being made pursuant to this Section;

(2)           the Payment Amount, the Offered Price, and the date on which Notes tendered and accepted for payment shall be purchased, which date shall be at least 30 days and not later than 60 days from the date such notices is mailed (the “Net Proceeds Payment Date”);

(3)           that any Notes not tendered or accepted for payment shall continue to accrue interest;

(4)           that, unless the Issuer defaults in making such payment, any Notes accepted for payment pursuant to the Net Proceeds Offer shall cease to accrue interest on and after the Net Proceeds Payment Date;

(5)           that Holders electing to have any Notes purchased pursuant to any Net Proceeds Offer shall be required to surrender the Notes, with the form entitled “Option of Holder to Elect Purchase” on the reverse of the Note completed, or transfer by book-entry transfer, to the Issuer, a depository, if appointed by the Issuer, or the Paying Agent at the address specified in the notice at least three days before the Net Proceeds Payment Date;

(6)           that Holders shall be entitled to withdraw their election if the Issuer, the Depository or the Paying Agent, as the case may be, receives, not later than the Net Proceeds Payment Date, a notice setting forth the name of the Holder, the principal amount of the Note the Holder delivered for purchase and a statement that such Holder is withdrawing his election to have such Note purchased;

(7)           that if the aggregate principal amount of Notes surrendered by Holders exceeds the Payment Amount, the Issuer shall select the Notes to be purchased on a pro rata basis (with such adjustments as may be deemed appropriate by the Issuer so that only Notes in denominations of $1,000, or integral multiples of $1,000, shall be purchased); and

(8)           that Holders whose Notes were purchased only in part shall be issued new Notes equal in principal amount to the unpurchased portion of the Notes surrendered (or transferred by book-entry).

(i)            On the Net Proceeds Payment Date, the Issuer shall, to the extent lawful:  (1) accept for payment all Notes or portions thereof properly tendered pursuant to the Net Proceeds Offer, subject to pro ration if the aggregate Notes tendered exceed the Payment Amount allocable to the Notes; (2) deposit with the Paying Agent U.S. Legal Tender equal to the lesser of the Payment Amount allocable to the Notes and the amount sufficient to pay the Offered Price in respect of all Notes or portions thereof so tendered; and (3) deliver or cause to be delivered to the Trustee the Notes so accepted together with an Officers’ Certificate stating the aggregate principal amount of Notes or portions thereof being repurchased by the Issuer.  The Issuer shall publicly announce the results of the Net Proceeds Offer on the Net Proceeds Payment Date.

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(j)            The Paying Agent shall promptly mail to each Holder of Notes so tendered the Offered Price for such Notes, and the Trustee shall promptly authenticate pursuant to an Authentication Order and mail (or cause to be transferred by book-entry) to each Holder a new Note equal in principal amount to any unrepurchased portion of the Notes surrendered, if any; provided that each such new Note shall be in principal amount of $1,000 or an integral multiple of $1,000.  However, if the Net Proceeds Payment Date is on or after an interest record date and on or before the related interest payment date, any accrued and unpaid interest shall be paid to the Person in whose name a Note is registered at the close of business on such record date, and no additional interest shall be payable to Holders who tender Notes pursuant to the Net Proceeds Offer.

(k)           The Issuer will comply with applicable tender offer rules, including the requirements of Rule 14e-1 under the Exchange Act and any other applicable laws and regulations in connection with the purchase of Notes pursuant to a Net Proceeds Offer.  To the extent that the provisions of any securities laws or regulations conflict with the provisions of this Section 4.13, the Issuer shall comply with the applicable securities laws and regulations and will not be deemed to have breached its obligations under this Section 4.13 by virtue of this compliance.

SECTION 4.14.          Limitations on Transactions with Affiliates.

(a)           The Issuer will not, and will not permit any Restricted Subsidiary to, directly or indirectly, in one transaction or a series of related transactions, sell, lease, transfer or otherwise dispose of any of its assets to, or purchase any assets from, or enter into any contract, agreement, understanding, loan, advance or guarantee with, or for the benefit of, any Affiliate involving aggregate payments or consideration in excess of $2.5 million (an “Affiliate Transaction”), unless:

(1)           such Affiliate Transaction is on terms that are not materially less favorable to the Issuer or the relevant Restricted Subsidiary than those that would have been obtained in a comparable transaction at such time on an arm’s-length basis by the Issuer or that Restricted Subsidiary from a Person that is not an Affiliate of the Issuer or that Restricted Subsidiary; and

(2)           the Issuer delivers to the Trustee:

(x)            with respect to any Affiliate Transaction involving aggregate value in excess of $10.0 million, an Officers’ Certificate certifying that such Affiliate Transaction complies with clause (1) above and a Secretary’s Certificate which sets forth and authenticates a resolution that has been adopted by the Board of Directors approving such Affiliate Transaction; and

(y)           with respect to any Affiliate Transaction involving aggregate value of $35.0 million or more, the certificates described in the preceding clause (x) and a written opinion as to the fairness of such Affiliate Transaction to the Issuer or such Restricted Subsidiary from a financial point of view issued by an Independent Financial Advisor.

(b)           The foregoing restrictions shall not apply to:

(1)           transactions exclusively between or among (a) the Issuer and one or more Restricted Subsidiaries or (b) Restricted Subsidiaries; provided, in each case, that no Affiliate of the Issuer (other than another Restricted Subsidiary) owns Equity Interests of any such Restricted Subsidiary;

(2)           reasonable director, officer and employee compensation (including bonuses) and other benefits (including retirement, health, stock option and other benefit plans) and indemnification and employment arrangements, in each case approved by the Board of Directors, and payments to Parent or on behalf of Parent to pay such amounts incurred by Parent;

(3)           payments by the Issuer and/or one or more Subsidiaries to any other Person with which the Issuer or such Subsidiaries are required or permitted to file a consolidated tax return or with which the Issuer or such Subsidiaries are part of a consolidated group for tax purposes, to be used by such Person to

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pay taxes, and which payments by the Issuer and such Subsidiaries are not in excess of the tax liabilities that would have been payable by them on a stand-alone basis;

(4)           payments by the Issuer to or on behalf of Parent in an amount sufficient to pay out-of-pocket legal, accounting and filing costs, franchise taxes, general operating and overhead expenses and other fees required to maintain the corporate existence of Parent or that are otherwise attributable to the ownership or operation of the Issuer and fees and expenses related to any unsuccessful securities offering of Parent actually incurred by Parent;

(5)           any agreement described in the Offering Memorandum as in effect as of the Issue Date or as thereafter amended in a manner not materially adverse to the Holders when taken as a whole;

(6)           any Restricted Payments which are made in accordance with Section 4.11 and Permitted Investments;

(7)           any transaction with an Affiliate where the only consideration paid by the Issuer or any Restricted Subsidiary is Equity Interests of Parent or Qualified Equity Interests;

(8)           the Transactions and the payment of fees and other expenses to be paid in connection with the consummation of the Transactions as described in the Offering Memorandum; or

(9)           so long as no Default exists, payments by the Issuer or on behalf of Parent to Sponsor and its Affiliates pursuant to the Advisory Agreement as in effect on the Issue Date or as thereafter amended in a manner not materially adverse to the Holders when taken as a whole.

SECTION 4.15.          Limitations on Dividend and Other Restrictions Affecting Restricted Subsidiaries.

The Issuer will not, and will not permit any Restricted Subsidiary to, directly or indirectly, create or otherwise cause or permit to exist or become effective any consensual encumbrance or consensual restriction on the ability of any Restricted Subsidiary to:

(a)           pay dividends or make any other distributions on or in respect of its Equity Interests;

(b)           make loans or advances or pay any Indebtedness or other obligation owed to the Issuer or any other Restricted Subsidiary; or

(c)           transfer any of its assets to the Issuer or any other Restricted Subsidiary;

except for:

(1)           encumbrances or restrictions existing under or by reason of applicable law;

(2)           encumbrances or restrictions existing under this Indenture, the Notes and the Note Guarantees;

(3)           non-assignment provisions of any contract or any lease or license entered into in the ordinary course of business;

(4)           encumbrances or restrictions existing under agreements existing on the date of this Indenture (including, without limitation, the Credit Facilities) as in effect on that date;

(5)           restrictions on the transfer of assets subject to any Lien permitted under this Indenture imposed by the holder of such Lien;

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(6)           restrictions on the transfer of assets imposed under any agreement to sell such assets permitted under this Indenture to any Person pending the closing of such sale;

(7)           any instrument governing Acquired Indebtedness, which encumbrance or restriction is not applicable to any Person, or the properties or assets of any Person, other than the Person or the properties or assets of the Person so acquired;

(8)           any other agreement governing Indebtedness entered into after the Issue Date that contains encumbrances and restrictions that are no more materially restrictive, taken as a whole, than those in effect on the Issue Date pursuant to agreements in effect on the Issue Date;

(9)           customary provisions in partnership agreements, limited liability company organizational governance documents, joint venture agreements and other similar agreements entered into in the ordinary course of business that restrict the transfer of ownership interests in such partnership, limited liability company, joint venture or similar Person;

(10)         Purchase Money Indebtedness and Capitalized Lease Obligations incurred in compliance with Section 4.10 that impose restrictions of the nature described in clause (c) above on the assets acquired;

(11)         encumbrances or restrictions contained in Indebtedness of Foreign Subsidiaries permitted to be incurred under this Indenture; and

(12)         any encumbrances or restrictions imposed by any amendments or refinancings of the contracts, instruments or obligations referred to in clauses (1) through (10) above; provided that such amendments or refinancings are, in the good faith judgment of the Issuer’s Board of Directors, no more materially restrictive taken as a whole with respect to such encumbrances and restrictions than those prior to such amendment or refinancing.

SECTION 4.16.          Additional Note Guarantees.

(a)           If, after the Issue Date, (x) the Issuer or any Restricted Subsidiary shall acquire or create another Subsidiary (other than an Excluded Subsidiary), (y) any Unrestricted Subsidiary is designated a Restricted Subsidiary (other than an Excluded Subsidiary) or (z) the Issuer otherwise elects to have any Restricted Subsidiary become a Guarantor, then, in each such case, the Issuer shall cause such Restricted Subsidiary to:

(1)           execute and deliver to the Trustee a supplemental indenture in form and substance reasonably satisfactory to the Trustee pursuant to which such Restricted Subsidiary shall unconditionally guarantee all of the Issuer’s obligations under the Notes and this Indenture to the same extent as the Note Guarantees; and

(2)           deliver to the Trustee one or more Opinions of Counsel that such supplemental indenture (a) has been duly authorized, executed and delivered by such Restricted Subsidiary and (b) constitutes a valid and legally binding obligation of such Restricted Subsidiary in accordance with its terms (provided, that such Opinion of Counsel shall not be given in connection with the execution of the supplemental indenture on the Issue Date).

Thereafter, such Restricted Subsidiary shall be a Guarantor for all purposes of this Indenture.

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(b)           Notwithstanding Section 4.16(a), a Subsidiary Guarantor will be automatically and unconditionally released and discharged from its obligations under its Note Guarantee, this Indenture and the Registration Rights Agreement under the circumstances set forth in Section 11.05(a).

SECTION 4.17.          Limitation on Layering Indebtedness.

The Issuer will not, and will not permit any Guarantor to, directly or indirectly, incur any Indebtedness that is or purports to be by its terms (or by the terms of any agreement governing such Indebtedness) subordinated in right of payment to any other Indebtedness of the Issuer or of such Guarantor, as the case may be, unless such Indebtedness is also by its terms (or by the terms of any agreement governing such Indebtedness) made expressly subordinate in right of payment to the Notes or the Note Guarantee of such Guarantor, to the same extent and in the same manner as such Indebtedness is subordinated in right of payment to such other Indebtedness of the Issuer or such Guarantor, as the case may be.

For purposes of the foregoing, no Indebtedness will be deemed to be subordinated in right of payment to any other Indebtedness of the Issuer or any Guarantor solely by virtue of being unsecured or secured by a junior priority lien or by virtue of the fact that the holders of such Indebtedness have entered into intercreditor agreements or other arrangements giving one or more of such holders priority over the other holders in the collateral held by them, including intercreditor agreements that contain customary provisions requiring turnover by holders of junior prior liens of proceeds of collateral in the event that the security interests in favor of the holders of the senior priority in such intended collateral are not perfected or invalidated and similar customary provisions protecting the holders of senior priority liens.

SECTION 4.18.          Reports to Holders.

Whether or not required by the SEC, so long as any Notes are outstanding, the Issuer or Parent will furnish to the Holders of Notes, or file electronically with the SEC through the SEC’s Electronic Data Gathering, Analysis and Retrieval System (or any successor system), within 15 days of the time periods that would be applicable to the Issuer or Parent, as applicable, if it were subject to Section 13(a) or 15(d) of the Exchange Act as a non-accelerated filer:

(1)           all quarterly and annual financial information that would be required to be contained in a filing with the SEC on Forms 10-Q and 10-K if the Issuer or Parent, as applicable, were required to file these Forms, including a “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and, with respect to the annual information only, a report on the annual financial statements by the Issuer’s or Parent’s, as applicable, certified independent accountants; and

(2)           all current reports that would be required to be filed with the SEC on Form 8-K if the Issuer or Parent were required to file these reports.

In addition, whether or not required by the SEC, the Issuer will file a copy of all of the information and reports referred to in clauses (1) and (2) above with the SEC for public availability within 15 days of the time periods specified in the SEC’s rules and regulations for a non-accelerated filer required to file reports under Section 13(a) or 15(d) of the Exchange Act (unless the SEC will not accept the filing) and make the information available to prospective investors upon request.  The Issuer agrees that it will not take any action (including, following the Registered Exchange Offer (as defined in the Registration Rights Agreement entered into on the Issue Date), terminating its registration under Section 15(d) of the Exchange Act) for the purpose of causing the SEC not to accept such filings.  The Issuer and the Guarantors have agreed that, for so long as any Notes remain outstanding, the Issuer will furnish to the Holders and to prospective investors, upon their request, the information required to be delivered pursuant to Rule 144A(d)(4) under the Securities Act.

Notwithstanding the foregoing, such requirements shall be deemed satisfied prior to the commencement of the Registered Exchange Offer or the effectiveness of the shelf registration statement required by the Registration Rights Agreement by (1) the filing with the SEC of the exchange offer registration statement or shelf registration statement (or any other similar registration statement), and any amendments thereto, with such financial information

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that satisfies Regulation S-X of the Securities Act or (2) by posting publicly on its website, within 15 days of the time periods after the Issuer or Parent would have been required to file annual and interim reports with the SEC as a non-accelerated filer, the information (including a “Management’s discussion and analysis of financial condition and results of operations” section) that would be required to be included in such reports, subject to exceptions consistent with the presentation of financial information in the Offering Memorandum.

Neither the Issuer nor any Guarantor shall provide information to any Person or the public not otherwise authorized to receive such information relative to performance requirements or performance contracts when such information requires access to information classified pursuant to Executive Order 12356, April 2, 1982 (47 Federal Register 14874, April 6, 1982), or successor or predecessor orders, or the Atomic Energy Act of 1954 (as amended).  Neither the Issuer nor any Guarantor shall be required to acknowledge to any Person or the public not otherwise authorized to receive such information the existence or non-existence of work under special access or compartmented programs.  Notwithstanding the foregoing, should the Issuer or any Guarantor withhold information permitted pursuant to this paragraph, such entity shall nonetheless use its commercially reasonable efforts to comply with the rules and regulations of the SEC relating to the information to be provided pursuant to the first paragraph above, but shall not be obligated to make disclosures required by the rules and regulations of the SEC to the extent such disclosures would conflict with the two preceding sentences.

SECTION 4.19.          Limitations on Designation of Unrestricted Subsidiaries.

(a)           The Issuer may designate any Subsidiary of the Issuer as an “Unrestricted Subsidiary” under this Indenture (a “Designation”) only if:

(1)           no Default shall have occurred and be continuing at the time of or after giving effect to such Designation; and

(2)           the Issuer would be permitted to make, at the time of such Designation, an Investment in an amount (the “Designation Amount”) equal to the Fair Market Value of the Issuer’s proportionate interest in such Subsidiary on such date.

(b)           No Subsidiary shall be Designated as an “Unrestricted Subsidiary” unless such Subsidiary:

(1)           has no Indebtedness other than Non-Recourse Debt;

(2)           is not party to any agreement, contract, arrangement or understanding with the Issuer or any Restricted Subsidiary unless the terms of the agreement, contract, arrangement or understanding are no less favorable to the Issuer or the Restricted Subsidiary, taken as a whole, than those that might be obtained at the time from Persons who are not Affiliates;

(3)           is a Person with respect to which neither the Issuer nor any Restricted Subsidiary has any direct or indirect obligation (a) to subscribe for additional Equity Interests or (b) to maintain or preserve the Person’s financial condition or to cause the Person to achieve any specified levels of operating results; and

(4)           has not guaranteed or otherwise directly or indirectly provided credit support for any Indebtedness of the Issuer or any Restricted Subsidiary, except for any guarantee given solely to support the pledge by the Issuer or any Restricted Subsidiary of the Equity Interests of such Unrestricted Subsidiary, which guarantee is not recourse to the Issuer or any Restricted Subsidiary.

(c)           If, at any time, any Unrestricted Subsidiary fails to meet the requirements of Section 4.19(a) and (b) as an Unrestricted Subsidiary, it shall thereafter cease to be an Unrestricted Subsidiary for purposes of this Indenture and any Indebtedness of the Subsidiary and any Liens on assets of such Subsidiary shall be deemed to be incurred by a Restricted Subsidiary as of such date and, if the Indebtedness is not permitted to be incurred under Section 4.10 or the Lien is not permitted under the covenant described under Section 4.12, the Issuer shall be in default of the applicable covenant.

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(d)           The Issuer may designate an Unrestricted Subsidiary as a Restricted Subsidiary (a “Redesignation”) only if:

(1)           no Default shall have occurred and be continuing at the time of and after giving effect to such Redesignation; and

(2)           all Liens, Indebtedness and Investments of such Unrestricted Subsidiary outstanding immediately following such Redesignation would, if incurred or made at such time, have been permitted to be incurred or made for all purposes of this Indenture.

(e)           All Designations and Redesignations must be evidenced by resolutions of the Board of Directors of the Issuer, delivered to the Trustee certifying compliance with the foregoing provisions.

SECTION 4.20.          Additional Interest Notice.

In the event that the Issuer is required to pay Additional Interest Holders of the Notes pursuant to the Registration Rights Agreement, the Issuer will provide written notice (an “Additional Interest Notice”) to the Trustee of its obligation to pay Additional Interest no later than fifteen days prior to the proposed payment date for the Additional Interest, and the Additional Interest Notice shall set forth the amount of Additional Interest to be paid by the Issuer on such payment date. The Trustee shall not at any time be under any duty or responsibility to any Holder of Notes to determine the Additional Interest, or with respect to the nature, extent, or calculation of the amount of Additional Interest owed, or with respect to the method employed in such calculation of the Additional Interest.

ARTICLE FIVE

SUCCESSOR CORPORATION

SECTION 5.01.          Mergers, Consolidations, Etc.

(a)           The Issuer will not, directly or indirectly, in a single transaction or a series of related transactions, consolidate or merge with or into another Person, or sell, lease, transfer, convey or otherwise dispose of or assign all or substantially all of the assets of the Issuer or the Issuer and the Restricted Subsidiaries (taken as a whole), unless:

(1)           either:

(a)           the Issuer will be the surviving or continuing Person; or

(b)           the Person formed by or surviving such consolidation or merger or to which such sale, lease, conveyance or other disposition shall be made (collectively, the “Successor”) is a corporation or limited liability company organized and existing under the laws of any State of the United States of America or the District of Columbia, and the Successor expressly assumes, by supplemental indenture in form and substance satisfactory to the Trustee, all of the obligations of the Issuer under the Notes, this Indenture and the Registration Rights Agreement;

(2)           immediately after giving effect to such transaction and the assumption of the obligations as set forth in clause (1)(b) above and the incurrence of any Indebtedness to be incurred in connection therewith, no Default shall have occurred and be continuing; and

(3)           immediately after and giving effect to such transaction and the assumption of the obligations set forth in clause (1)(b) above and the incurrence of any Indebtedness to be incurred in connection therewith, and the use of any net proceeds therefrom on a pro forma basis, either (x) the Issuer or the Successor, as the case may be, could incur $1.00 of additional Indebtedness pursuant to the Coverage Ratio Exception or (y) the Consolidated Interest Coverage Ratio of the Issuer or the Successor, as the case may be, would be at least equal to the Consolidated Interest Coverage Ratio of the Issuer immediately prior to such transaction.

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For purposes of this Section 5.01, any Indebtedness of the Successor which was not Indebtedness of the Issuer immediately prior to the transaction shall be deemed to have been incurred in connection with such transaction.

Clause (3) above shall not apply to the merger of the Issuer with a Subsidiary of Parent solely for the purpose of reincorporating the Issuer in another jurisdiction of the United States.

(b)           Parent will not, directly or indirectly, in a single transaction or a series of related transactions, consolidate or merge with or into another Person, or sell, lease, transfer, convey or otherwise dispose of or assign all or substantially all of the assets of Parent and its Subsidiaries (taken as a whole) unless:

(1)           either:

(a)           Parent will be the surviving or continuing Person; or

(b)           the Person formed by or surviving such consolidation or merger or to which such sale, lease, conveyance or other disposition shall be made (collectively, the “Parent Successor”) is a corporation, limited liability company or limited partnership organized and existing under the laws of any State of the United States of America or the District of Columbia, and the Parent Successor expressly assumes, by supplemental indenture in form and substance reasonably satisfactory to the Trustee, all of the obligations of Parent under its Note Guarantee, this Indenture and the Registration Rights Agreement; and

(2)           immediately after giving effect to such transaction, no Default shall have occurred and be continuing.

(c)           Except as provided in Section 11.05(a), no Guarantor (other than Parent, as provided above) may consolidate with or merge with or into (whether or not such Guarantor is the surviving Person) another Person, unless:

(1)           either:

(a)           such Guarantor will be the surviving or continuing Person; or

(b)           the Person formed by or surviving any such consolidation or merger is another Guarantor or assumes, by supplemental indenture in form and substance reasonably satisfactory to the Trustee, all of the obligations of such Guarantor under the Note Guarantee of such Guarantor, this Indenture and the Registration Rights Agreement; and

(2)           immediately after giving effect to such transaction, no Default shall have occurred and be continuing.

(d)           For purposes of the foregoing, the transfer (by lease, assignment, sale or otherwise, in a single transaction or series of transactions) of all or substantially all of the properties or assets of one or more Restricted Subsidiaries, the Equity Interests of which constitute all or substantially all of the properties and assets of the Issuer, will be deemed to be the transfer of all or substantially all of the properties and assets of the Issuer or Parent, as the case may be.

(e)           Upon any consolidation, combination or merger of the Issuer or a Guarantor, or any transfer of all or substantially all of the assets of the Issuer or Parent in accordance with the foregoing, in which the Issuer or such Guarantor is not the continuing obligor under the Notes or its Note Guarantee, the surviving entity formed by such consolidation or into which the Issuer or such Guarantor is merged or the entity to which the conveyance, lease or transfer is made will succeed to, and be substituted for, and may exercise every right and power of, the Issuer or such Guarantor under this Indenture, the Notes and the Note Guarantees with the same effect as if such surviving entity had been named therein as the Issuer or such Guarantor, and, except in the case of a lease, the Issuer or such Guarantor, as the case may be, will be released from the obligation to pay the principal of and interest on the Notes

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or in respect of its Note Guarantee, as the case may be, and all of the Issuer’s or such Guarantor’s other obligations and covenants under the Notes, this Indenture and its Note Guarantee, if applicable.

(f)            Notwithstanding the foregoing, any Restricted Subsidiary may consolidate with, merge with or into or convey, transfer or lease, in one transaction or a series of transactions, all or substantially all of its assets to, the Issuer or another Restricted Subsidiary.

ARTICLE SIX

DEFAULT AND REMEDIES

SECTION 6.01.          Events of Default.

Each of the following is an “Event of Default”:

(1)           failure by the Issuer to pay interest on any of the Notes when it becomes due and payable and the continuance of any such failure for 30 days;

(2)           failure by the Issuer to pay the principal on any of the Notes when it becomes due and payable, whether at stated maturity, upon redemption, upon purchase, upon acceleration or otherwise;

(3)           failure by the Issuer to comply with Section 5.01 or in respect of its obligations to make a Change of Control Offer pursuant to Section 4.09;

(4)           failure by the Issuer to comply with any other agreement or covenant in this Indenture and continuance of this failure for 60 days after notice of the failure has been given to the Issuer by the Trustee or by the Holders of at least 25% of the aggregate principal amount of the Notes then outstanding;

(5)           default under any mortgage, indenture or other instrument or agreement under which there may be issued or by which there may be secured or evidenced Indebtedness of the Issuer or any Restricted Subsidiary, whether such Indebtedness now exists or is incurred after the Issue Date, which default:

(a)           is caused by a failure to pay at final maturity, principal on such Indebtedness within the applicable express grace period and any extensions thereof,

(b)           results in the acceleration of such Indebtedness prior to its express final maturity or

(c)           results in the commencement of judicial proceedings to foreclose upon, or to exercise remedies under applicable law or applicable security documents to take ownership of, the assets securing such Indebtedness, and

in each case, the principal amount of such Indebtedness, together with any other Indebtedness with respect to which an event described in clause (a), (b) or (c) has occurred and is continuing, aggregates $35.0 million or more;

(6)           one or more judgments or orders that exceed $35.0 million in the aggregate (net of amounts covered by insurance or bonded) for the payment of money have been entered by a court or courts of competent jurisdiction against the Issuer or any Restricted Subsidiary and such judgment or judgments have not been satisfied, stayed, annulled or rescinded within 60 days of being entered;

(7)           the Issuer or any Significant Subsidiary pursuant to or within the meaning of any Bankruptcy Law:

(a)           commences a voluntary case,

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(b)           consents to the entry of an order for relief against it in an involuntary case,

(c)           consents to the appointment of a Custodian of it or for all or substantially all of its assets, or

(d)           makes a general assignment for the benefit of its creditors;

(8)           a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:

(a)           is for relief against the Issuer or any Significant Subsidiary as debtor in an involuntary case,

(b)           appoints a Custodian of the Issuer or any Significant Subsidiary or a Custodian for all or substantially all of the assets of the Issuer or any Significant Subsidiary, or

(c)           orders the liquidation of the Issuer or any Significant Subsidiary,

and the order or decree remains unstayed and in effect for 60 days; or

(9)           any Note Guarantee of any Significant Subsidiary ceases to be in full force and effect (other than in accordance with the terms of such Note Guarantee and this Indenture) or is declared null and void and unenforceable or found to be invalid or any Guarantor denies its liability under its Note Guarantee (other than by reason of release of a Guarantor from its Note Guarantee in accordance with the terms of this Indenture).

SECTION 6.02.          Acceleration.

If an Event of Default specified in Section 6.01(7) or (8) with respect to the Issuer occurs, all outstanding Notes shall become due and payable without any further action or notice.  If an Event of Default (other than an Event of Default specified in Section 6.01(7) or (8) with respect to the Issuer) shall have occurred and be continuing under this Indenture, the Trustee, by written notice to the Issuer, or the Holders of at least 25% in aggregate principal amount of the Notes then outstanding by written notice to the Issuer and the Trustee, may declare (an “acceleration declaration”) all amounts owing under the Notes to be due and payable immediately.  Upon such declaration of acceleration, the aggregate principal of and accrued and unpaid interest on the outstanding Notes shall become due and payable immediately; provided, however, that after such acceleration, but before a judgment or decree based on acceleration, the Holders of a majority in aggregate principal amount of such outstanding Notes may rescind and annul such acceleration:

(1)           if the rescission would not conflict with any judgment or decree;

(2)           if all existing Defaults have been cured or waived except nonpayment of principal and interest that has become due solely because of this acceleration;

(3)           to the extent the payment of such interest is lawful, interest on overdue installments of interest and overdue principal, which has become due otherwise than by such declaration of acceleration, has been paid;

(4)           if the Issuer has paid to the Trustee its reasonable compensation and reimbursed the Trustee of its expenses, disbursements and advances; and

(5)           in the event of a cure or waiver of a Default of the type set forth in Section 6.01(7) or (8), the Trustee shall have received an Officers’ Certificate and an Opinion of Counsel that such Default has been cured or waived.

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No such rescission shall affect any subsequent Default or impair any right consequent thereto.

SECTION 6.03.          Other Remedies.

If a Default occurs and is continuing, the Trustee may pursue any available remedy by proceeding at law or in equity to collect the payment of principal of, or interest on, the Notes or to enforce the performance of any provision of the Notes or this Indenture.

The Trustee may maintain a proceeding even if it does not possess any of the Notes or does not produce any of them in the proceeding.  A delay or omission by the Trustee or any Holder in exercising any right or remedy accruing upon a Default shall not impair the right or remedy or constitute a waiver of or acquiescence in the Default.  No remedy is exclusive of any other remedy.  All available remedies are cumulative to the extent permitted by law.

SECTION 6.04.          Waiver of Past Defaults.

Subject to Sections 2.09, 6.07 and 9.02, the Holders of a majority in principal amount of the outstanding Notes (which may include consents obtained in connection with a tender offer or exchange offer of Notes) by notice to the Trustee may waive an existing Default and its consequences, except a Default in the payment of principal of, or interest on, any Note as specified in Section 6.01(1) or (2).  The Issuer shall deliver to the Trustee an Officers’ Certificate stating that the requisite percentage of Holders have consented to such waiver and attaching copies of such consents.  When a Default is waived, it is cured and ceases.

SECTION 6.05.          Control by Majority.

The Holders of not less than a majority in principal amount of the outstanding Notes may direct the time, method and place of conducting any proceeding for any remedy available to the Trustee or exercising any trust or power conferred on it.  Subject to Section 7.01, however, the Trustee may refuse to follow any direction that conflicts with any law or this Indenture, that the Trustee determines may be unduly prejudicial to the rights of another Holder, or that may involve the Trustee in personal liability; provided that the Trustee may take any other action deemed proper by the Trustee which is not inconsistent with such direction.

In the event the Trustee takes any action or follows any direction pursuant to this Indenture, the Trustee shall be entitled to indemnification reasonably satisfactory to the Trustee against any loss or expense caused by taking such action or following such direction.

SECTION 6.06.          Limitation on Suits.

No Holder will have any right to institute any proceeding with respect to this Indenture or for any remedy thereunder, unless the Trustee:

(1)           has failed to act for a period of 60 days after receiving written notice of a continuing Event of Default by such Holder and a request to act by Holders of at least 25% in aggregate principal amount of Notes outstanding;

(2)           has been offered indemnity satisfactory to it in its reasonable judgment; and

(3)           has not received from the Holders of a majority in aggregate principal amount of the outstanding Notes a direction inconsistent with such request.

However, such limitations do not apply to a suit instituted by a Holder of any Note for enforcement of payment of the principal of or interest on such Note on or after the due date therefor.

A Holder may not use this Indenture to prejudice the rights of another Holder or to obtain a preference or priority over such other Holder.

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SECTION 6.07.          Rights of Holders To Receive Payment.

Notwithstanding any other provision of this Indenture, the right of any Holder to receive payment of principal of, and interest on, a Note, on or after the respective due dates therefor, or to bring suit for the enforcement of any such payment on or after such respective dates, shall not be impaired or affected without the consent of the Holder.

SECTION 6.08.          Collection Suit by Trustee.

If a Default in payment of principal or interest specified in Section 6.01(1) or (2) occurs and is continuing, the Trustee may recover judgment in its own name and as trustee of an express trust against the Issuer or any other obligor on the Notes for the whole amount of principal and accrued interest and fees remaining unpaid, together with interest on overdue principal and, to the extent that payment of such interest is lawful, interest on overdue installments of interest, in each case at the rate per annum borne by the Notes and such further amount as shall be sufficient to cover the costs and expenses of collection, including the reasonable compensation, expenses, disbursements and advances of the Trustee, its agents and counsel.

SECTION 6.09.          Trustee May File Proofs of Claim.

The Trustee may file such proofs of claim and other papers or documents as may be necessary or advisable in order to have the claims of the Trustee (including any claim for the compensation, expenses, disbursements and advances of the Trustee, its agents and counsel) and the Holders allowed in any judicial proceedings relating to the Issuer, their creditors or their property and shall be entitled and empowered to collect and receive any monies or other property payable or deliverable on any such claims and to distribute the same, and any Custodian in any such judicial proceedings is hereby authorized by each Holder to make such payments to the Trustee and, in the event that the Trustee shall consent to the making of such payments directly to the Holders, to pay to the Trustee any amount due to it for the reasonable compensation, expenses, disbursements and advances of the Trustee, its agent and counsel, and any other amounts due the Trustee under Section 7.07.  Nothing herein contained shall be deemed to authorize the Trustee to authorize or consent to or accept or adopt on behalf of any Holder any plan of reorganization, arrangement, adjustment or composition affecting the Notes or the rights of any Holder thereof, or to authorize the Trustee to vote in respect of the claim of any Holder in any such proceeding.  The Trustee shall be entitled to participate as a member of any official committee of creditors in the matters as it deems necessary or advisable.

SECTION 6.10.          Priorities.

If the Trustee collects any money or property pursuant to this Article Six, it shall pay out the money or property in the following order:

First:  to the Trustee for amounts due under Section 7.07;

Second:  to Holders for interest accrued on the Notes, ratably, without preference or priority of any kind, according to the amounts due and payable on the Notes for interest;

Third:  to Holders for principal amounts due and unpaid on the Notes, ratably, without preference or priority of any kind, according to the amounts due and payable on the Notes for principal; and

Fourth:  to the Issuer or, if applicable, the Guarantors, as their respective interests may appear.

The Trustee, upon prior notice to the Issuer, may fix a record date and payment date for any payment to Holders pursuant to this Section 6.10.

SECTION 6.11.          Undertaking for Costs.

In any suit for the enforcement of any right or remedy under this Indenture or in any suit against the Trustee for any action taken or omitted by it as Trustee, a court in its discretion may require the filing by any party

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litigant in the suit of an undertaking to pay the costs of the suit, and the court in its discretion may assess reasonable costs, including reasonable attorneys’ fees and expenses, against any party litigant in the suit, having due regard to the merits and good faith of the claims or defenses made by the party litigant.  This Section 6.11 does not apply to a suit by the Trustee, a suit by a Holder pursuant to Section 6.07, or a suit by a Holder or Holders of more than 10% in principal amount of the outstanding Notes.

ARTICLE SEVEN

TRUSTEE

SECTION 7.01.          Duties of Trustee.

(a)           If a Default has occurred and is continuing, the Trustee shall exercise such of the rights and powers vested in it by this Indenture and use the same degree of care and skill in their exercise as a prudent person would exercise or use under the circumstances in the conduct of his or her own affairs.

(b)           Except during the continuance of a Default:

(1)           The Trustee need perform only those duties as are specifically set forth herein or in the Trust Indenture Act and no duties, covenants, responsibilities or obligations shall be implied in this Indenture against the Trustee.

(2)           In the absence of bad faith on its part, the Trustee may conclusively rely, as to the truth of the statements and the correctness of the opinions expressed therein, upon certificates (including Officers’ Certificates) or opinions (including Opinions of Counsel) furnished to the Trustee and conforming to the requirements of this Indenture.  However, in the case of any such certificates or opinions which by any provision hereof are specifically required to be furnished to the Trustee, the Trustee shall examine the certificates and opinions to determine whether or not they conform to the requirements of this Indenture (but need not confirm or investigate the accuracy of mathematical calculations or other facts stated therein).

(c)           Notwithstanding anything to the contrary herein, the Trustee may not be relieved from liability for its own negligent action, its own negligent failure to act, or its own willful misconduct, except that:

(1)           This paragraph does not limit the effect of Section 7.01(b).

(2)           The Trustee shall not be liable for any error of judgment made in good faith by a Responsible Officer, unless it is proved that the Trustee was negligent in ascertaining the pertinent facts.

(3)           The Trustee shall not be liable with respect to any action it takes or omits to take in good faith in accordance with a direction received by it pursuant to Section 6.05.

(d)           No provision of this Indenture shall require the Trustee to expend or risk its own funds or otherwise incur any financial liability in the performance of any of its duties hereunder or to take or omit to take any action under this Indenture or take any action at the request or direction of Holders if it shall have reasonable grounds for believing that repayment of such funds is not assured to it.

(e)           Whether or not therein expressly so provided, every provision of this Indenture that in any way relates to the Trustee is subject to this Section 7.01.

(f)            The Trustee shall not be liable for interest on any money received by it except as the Trustee may agree in writing with the Issuer.  Money held in trust by the Trustee need not be segregated from other funds except to the extent required by law.

(g)           In the absence of bad faith, negligence or willful misconduct on the part of the Trustee, the Trustee shall not be responsible for the application of any money by any Paying Agent other than the Trustee.

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SECTION 7.02.          Rights of Trustee.

Subject to Section 7.01:

(a)           The Trustee may rely conclusively on any resolution, certificate (including any Officers’ Certificate), statement, instrument, opinion (including any Opinion of Counsel), notice, request, direction, consent, order, bond, debenture, or other paper or document believed by it to be genuine and to have been signed or presented by the proper Person.  The Trustee need not investigate any fact or matter stated in the document.

(b)           Before the Trustee acts or refrains from acting, it may require an Officers’ Certificate and an Opinion of Counsel, which shall conform to the provisions of Section 12.05.  The Trustee shall not be liable for any action it takes or omits to take in good faith in reliance on such Officers’ Certificate or Opinion of Counsel.

(c)           The Trustee may act through its attorneys and agents and shall not be responsible for the misconduct or negligence of any agent (other than an agent who is an employee of the Trustee) appointed with due care.

(d)           The Trustee shall not be liable for any action it takes or omits to take in good faith which it reasonably believes to be authorized or within its rights or powers under this Indenture.

(e)           The Trustee may consult with counsel of its selection and the advice or opinion of such counsel as to matters of law shall be full and complete authorization and protection from liability in respect of any action taken, omitted or suffered by it hereunder in good faith and in accordance with the advice or opinion of such counsel.

(f)            The Trustee shall be under no obligation to exercise any of the rights or powers vested in it by this Indenture at the request, order or direction of any of the Holders pursuant to the provisions of this Indenture, unless such Holders shall have offered to the Trustee reasonable security or indemnity satisfactory to it against the costs, expenses and liabilities which may be incurred therein or thereby.

(g)           The Trustee shall not be bound to make any investigation into the facts or matters stated in any resolution, certificate (including any Officers’ Certificate), statement, instrument, opinion (including any Opinion of Counsel), notice, request, direction, consent, order, bond, debenture, or other paper or document, but the Trustee, in its discretion, may make such further inquiry or investigation into such facts or matters as it may see fit and, if the Trustee shall determine to make such further inquiry or investigation, it shall be entitled, upon reasonable notice to the Issuer, to examine the books, records, and premises of the Issuer, personally or by agent or attorney at the sole cost of the Issuer.

(h)           The Trustee shall not be required to give any bond or surety in respect of the performance of its powers and duties hereunder.

(i)            The permissive rights of the Trustee to do things enumerated in this Indenture shall not be construed as duties.

(j)            Except with respect to Section 4.01 and 4.06, the Trustee shall have no duty to inquire as to the performance of the Issuer with respect to the covenants contained in Article 4.  In addition, the Trustee shall not be deemed to have knowledge of an Event of Default except (i) any Default or Event of Default occurring pursuant to Sections 4.01 or 6.01(1) or (2) or (ii) any Default or Event of Default of which the Trustee shall have received written notification at the Corporate Trust Office and such notice references the Notes and this Indenture.

(k)           The rights, privileges, protections, immunities and benefits given to the Trustee, including, without limitation, its right to be indemnified, are extended to, and shall be enforceable by, the Trustee

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in each of its capacities hereunder, and to each agent, custodian and other Person employed to act hereunder.

(l)            In no event shall the Trustee be responsible or liable for special, indirect, or consequential loss or damage of any kind whatsoever (including, but not limited to, loss of profit) irrespective of whether the Trustee has been advised of the likelihood of such loss or damage and regardless of the form of action.

(m)          The Trustee may request that the Issuer deliver a certificate setting forth the names of individuals and/or titles of officers authorized at such time to take specified actions pursuant to this Indenture.

SECTION 7.03.          Individual Rights of Trustee.

The Trustee in its individual or any other capacity may become the owner or pledgee of Notes and may otherwise deal with the Issuer, its Subsidiaries or its respective Affiliates with the same rights it would have if it were not Trustee.  Any Agent may do the same with like rights.  However, the Trustee must comply with Sections 7.10 and 7.11.

SECTION 7.04.          Trustee’s Disclaimer.

The Trustee shall not be responsible for and makes no representation as to the validity or adequacy of this Indenture or the Notes, it shall not be accountable for the Issuer’s use of the proceeds from the Notes, and it shall not be responsible for any statement of the Issuer in this Indenture or any document issued in connection with the sale of Notes or any statement in the Notes other than the Trustee’s certificate of authentication.  The Trustee makes no representations with respect to the effectiveness or adequacy of this Indenture.

SECTION 7.05.          Notice of Default.

If a Default occurs and is continuing and the Trustee receives actual notice of such Default, the Trustee shall mail to each Holder notice of the uncured Default within 30 days after such Default occurs.  Except in the case of a Default in payment of principal of, or interest on, any Note, including an accelerated payment and the failure to make a payment on the Change of Control Payment Date pursuant to a Change of Control Offer or the Net Proceeds Payment Date pursuant to a Net Proceeds Offer, or a Default in complying with the provisions of Article Five, the Trustee may withhold the notice if and so long as the Board of Directors, the executive committee, or a trust committee of directors and/or Responsible Officers, of the Trustee in good faith determines that withholding the notice is in the interest of the Holders.

SECTION 7.06.          Reports by Trustee to Holders.

Within 60 days after each January 1, beginning with January 1, 2012, the Trustee shall, to the extent that any of the events described in Trust Indenture Act § 313(a) occurred within the previous twelve months, but not otherwise, mail to each Holder a brief report dated as of such date that complies with Trust Indenture Act § 313(a).  The Trustee also shall comply with Trust Indenture Act §§ 313(b), 313(c) and 313(d).

A copy of each report at the time of its mailing to Holders shall be mailed to the Issuer and filed with the SEC and each securities exchange, if any, on which the Notes are listed.

The Issuer shall notify the Trustee if the Notes become listed on any securities exchange or of any delisting thereof and the Trustee shall comply with Trust Indenture Act § 313(d).

SECTION 7.07.          Compensation and Indemnity.

The Issuer shall pay to the Trustee from time to time such compensation as the Issuer and the Trustee shall from time to time agree in writing for its services hereunder.  The Trustee’s compensation shall not be limited by any law on compensation of a trustee of an express trust.  The Issuer shall reimburse the Trustee upon request for all

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reasonable disbursements, expenses and advances (including reasonable fees and expenses of counsel) incurred or made by it in addition to the compensation for its services, except any such disbursements, expenses and advances as may be attributable to the Trustee’s negligence, bad faith or willful misconduct.  Such expenses shall include the reasonable fees and expenses of the Trustee’s agents and counsel.

The Issuer shall indemnify each of the Trustee or any predecessor Trustee and its agents for, and hold them harmless against, any and all loss, damage, claims including taxes (other than taxes based upon, measured by or determined by the income of the Trustee), liability or expense incurred by them except for such actions to the extent caused by any negligence, bad faith or willful misconduct on their part, arising out of or in connection with the acceptance or administration of this trust including the reasonable costs and expenses of defending themselves against or investigating any claim or liability in connection with the exercise or performance of any of the Trustee’s rights, powers or duties hereunder.  The Trustee shall notify the Issuer promptly of any claim asserted against the Trustee or any of its agents for which it may seek indemnity.  The Issuer may, subject to the approval of the Trustee (which approval shall not be unreasonably withheld), defend the claim and the Trustee shall cooperate in the defense.  The Trustee and its agents subject to the claim may have separate counsel and the Issuer shall pay the reasonable fees and expenses of such counsel; provided, however, that the Issuer will not be required to pay such fees and expenses if, subject to the approval of the Trustee (which approval shall not be unreasonably withheld), it assumes the Trustee’s defense and there is no conflict of interest between the Issuer and the Trustee and its agents subject to the claim in connection with such defense as reasonably determined by the Trustee.  The Issuer need not pay for any settlement made without its written consent (which shall not be unreasonably withheld).  The Issuer need not reimburse any expense or indemnify against any loss or liability to the extent incurred by the Trustee through its negligence, bad faith or willful misconduct.

To secure the Issuer’s payment obligations in this Section 7.07, the Trustee shall have a Lien prior to the Notes against all money or property held or collected by the Trustee, in its capacity as Trustee, except money or property held in trust to pay principal and interest on particular Notes.

When the Trustee incurs expenses or renders services after a Default specified in Section 6.01(7) or (8)  occurs, such expenses and the compensation for such services shall be paid to the extent allowed under any Bankruptcy Law.

Notwithstanding any other provision in this Indenture, the foregoing provisions of this Section 7.07 shall survive the satisfaction and discharge of this Indenture or the appointment of a successor Trustee.

SECTION 7.08.          Replacement of Trustee.

The Trustee may resign at any time by so notifying the Issuer in writing.  The Holders of a majority in principal amount of the outstanding Notes may remove the Trustee by so notifying the Issuer and the Trustee and may appoint a successor Trustee.  The Issuer may remove the Trustee if:

(1)           the Trustee fails to comply with Section 7.10;

(2)           the Trustee is adjudged a bankrupt or an insolvent;

(3)           a receiver or other public officer takes charge of the Trustee or its property; or

(4)           the Trustee becomes incapable of acting.

If the Trustee resigns or is removed or if a vacancy exists in the office of Trustee for any reason, the Issuer shall notify each Holder of such event and shall promptly appoint a successor Trustee.  Within one year after the successor Trustee takes office, the Holders of a majority in principal amount of the Notes may appoint a successor Trustee to replace the successor Trustee appointed by the Issuer.

A successor Trustee shall deliver a written acceptance of its appointment to the retiring Trustee and to the Issuer.  Immediately after that, the retiring Trustee shall transfer, after payment of all sums then owing to the Trustee

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pursuant to Section 7.07, all property held by it as Trustee to the successor Trustee, subject to the Lien provided in Section 7.07, the resignation or removal of the retiring Trustee shall become effective, and the successor Trustee shall have all the rights, powers and duties of the Trustee under this Indenture.  A successor Trustee shall mail notice of its succession to each Holder.

If a successor Trustee does not take office within 60 days after the retiring Trustee resigns or is removed, the retiring Trustee, at the Issuer’s expense, the Issuer or the Holders of at least 10% in principal amount of the outstanding Notes may petition any court of competent jurisdiction for the appointment of a successor Trustee at the expense of the Issuer.

If the Trustee fails to comply with Section 7.10, any Holder may petition any court of competent jurisdiction for the removal of the Trustee and the appointment of a successor Trustee.

Notwithstanding replacement of the Trustee pursuant to this Section 7.08, the Issuer’s obligations under Section 7.07 shall continue for the benefit of the retiring Trustee.

SECTION 7.09.          Successor Trustee by Merger, Etc.

If the Trustee consolidates with, merges or converts into, or transfers all or substantially all of its corporate trust business to, another corporation, the resulting, surviving or transferee corporation without any further act shall, if such resulting, surviving or transferee corporation is otherwise eligible hereunder, be the successor Trustee; provided that such corporation shall be otherwise qualified and eligible under this Article Seven.

SECTION 7.10.          Eligibility; Disqualification.

This Indenture shall always have a Trustee who satisfies the requirement of Trust Indenture Act §§ 310(a)(1), 310(a)(2) and 310(a)(5).  The Trustee shall have a combined capital and surplus of at least $150,000,000 as set forth in its most recent published annual report of condition.  The Trustee shall comply with Trust Indenture Act § 310(b); provided, however, that there shall be excluded from the operation of Trust Indenture Act § 310(b)(1) any indenture or indentures under which other securities, or certificates of interest or participation in other securities, of the Issuer are outstanding, if the requirements for such exclusion set forth in Trust Indenture Act § 310(b)(1) are met.  The provisions of Trust Indenture Act § 310 shall apply to the Issuer and any other obligor of the Notes.

SECTION 7.11.          Preferential Collection of Claims Against the Issuer.

The Trustee, in its capacity as Trustee hereunder, shall comply with Trust Indenture Act § 311(a), excluding any creditor relationship listed in Trust Indenture Act § 311(b).  A Trustee who has resigned or been removed shall be subject to Trust Indenture Act § 311(a) to the extent indicated.

ARTICLE EIGHT

DISCHARGE OF INDENTURE; DEFEASANCE

SECTION 8.01.          Termination of the Issuer’s Obligations.

The Issuer may terminate its obligations under the Notes and this Indenture and the obligations of the Guarantors under the Note Guarantees and this Indenture and this Indenture shall cease to be of further effect, except those obligations referred to in the penultimate paragraph of this Section 8.01, if:

(1)           all the Notes that have been authenticated and delivered (except lost, stolen or destroyed Notes which have been replaced or paid and Notes for whose payment money has been deposited in trust or segregated and held in trust by the Issuer and thereafter repaid to the Issuer or discharged from this trust) have been delivered to the Trustee for cancellation, or

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(2)(a) all Notes not delivered to the Trustee for cancellation otherwise (i) have become due and payable, (ii) will become due and payable, or may be called for redemption within one year or (iii) have been called for redemption pursuant to Section 5 of the Notes and the Issuer has irrevocably deposited or caused to be deposited with the Trustee as trust funds, in trust solely for the benefit of Holders, U.S. Legal Tender, U.S. Government Obligations or a combination thereof, in such amounts as will be sufficient (without consideration of any reinvestment of interest) to pay and discharge the entire Indebtedness (including all principal and accrued interest and premium, if any) on the Notes not theretofore delivered to the Trustee for cancellation,

(b)the Issuer has paid all sums payable by them under this Indenture, and

(c)the Issuer has delivered irrevocable instructions to the Trustee to apply the deposited money toward the payment of the Notes at maturity or on the date of redemption, as the case may be.

In addition, in the case of clause (2), the Issuer must deliver an Officers’ Certificate and an Opinion of Counsel stating that all conditions precedent to satisfaction and discharge have been complied with.

In the case of clause (2) of this Section 8.01, and subject to the next sentence and notwithstanding the foregoing paragraph, the Issuer’s obligations in Sections 2.05, 2.06, 2.07, 2.08, 2.10, 4.01, 4.02, 4.03 (as to legal existence of the Issuer only), 7.07, 8.05 and 8.06 shall survive until the Notes are no longer outstanding pursuant to the last paragraph of Section 2.08.  After the Notes are no longer outstanding, the Issuer’s obligations in Sections 7.07, 8.05 and 8.06 shall survive.

After such delivery or irrevocable deposit, the Trustee upon request shall acknowledge in writing the discharge of the Issuer’s obligations under the Notes and this Indenture except for those surviving obligations specified above.

SECTION 8.02.Legal Defeasance and Covenant Defeasance.

(a)The Issuer may, at its option and at any time, elect to have either paragraph (b) or (c) below be applied to the outstanding Notes upon compliance with the conditions set forth in Section 8.03.

(b)Upon the Issuer’s exercise under Section 8.02(a) hereof of the option applicable to this Section 8.02(b), the Issuer and the Guarantors shall, subject to the satisfaction of the conditions set forth in Section 8.03, be deemed to have been discharged from their obligations with respect to all outstanding Notes on the date the conditions set forth below are satisfied (hereinafter, “Legal Defeasance”).  For this purpose, Legal Defeasance means that the Issuer and the Guarantors shall be deemed to have paid and discharged the entire Indebtedness represented by the outstanding Notes and the Note Guarantees, which shall thereafter be deemed to be “outstanding” only for the purposes of Section 8.04 hereof and the other Sections of this Indenture referred to in (i) and (ii) below, and to have satisfied all its other obligations under such Notes and this Indenture and the Guarantors shall be deemed to have satisfied all of their obligations under the Note Guarantees and this Indenture (and the Trustee, on demand of and at the expense of the Issuer, shall execute proper instruments acknowledging the same), except for the following provisions which shall survive until otherwise terminated or discharged hereunder:

(i)the rights of Holders of outstanding Notes to receive, solely from the trust fund described in Section 8.04 hereof, and as more fully set forth in such Section 8.04, payments in respect of the principal of , premium, if any, and interest on such Notes when such payments are due;

(ii)the Issuer’s obligations with respect to such Notes under Article Two and Section 4.02 hereof;

(iii)the rights, powers, trusts, duties and immunities of the Trustee hereunder and the Issuer’s obligations in connection therewith; and

(iv)the provisions of this Article Eight applicable to Legal Defeasance.

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Subject to compliance with this Article Eight, the Issuer may exercise its option under this Section 8.02(b) notwithstanding the prior exercise of its option under Section 8.02(c) hereof.

(c)Upon the Issuer’s exercise under paragraph (a) hereof of the option applicable to this paragraph (c), the Issuer and the Guarantors shall, subject to the satisfaction of the conditions set forth in Section 8.03 hereof, be released from their respective obligations under the covenants contained in Sections 4.03 (other than with respect to the legal existence of the Issuer), 4.04, 4.07 and 4.09 through 4.19, clause (3) of Section 5.01(a) and Article 11 hereof with respect to the outstanding Notes on and after the date the conditions set forth in Section 8.03 are satisfied (hereinafter, “Covenant Defeasance”), and the Notes shall thereafter be deemed not “outstanding” for the purposes of any direction, waiver, consent or declaration or act of Holders (and the consequences of any thereof) in connection with such covenants, but shall continue to be deemed “outstanding” for all other purposes hereunder (it being understood that such Notes shall not be deemed outstanding for accounting purposes).  For this purpose, Covenant Defeasance means that, with respect to the outstanding Notes, the Issuer and the Guarantors may omit to comply with and shall have no liability in respect of any term, condition or limitation set forth in any such covenant, whether directly or indirectly, by reason of any reference elsewhere herein to any such covenant or by reason of any reference in any such covenant to any other provision herein or in any other document and such omission to comply shall not constitute an Event of Default under Section 6.01 hereof, but, except as specified above, the remainder of this Indenture and such Notes shall be unaffected thereby.  In addition, upon the Issuer’s exercise under paragraph (a) hereof of the option applicable to this paragraph (c), subject to the satisfaction of the conditions set forth in Section 8.03 hereof, clauses (3), (4), (5), (6) and (9) of Section 6.01 hereof shall not constitute Events of Default.

SECTION 8.03.Conditions to Legal Defeasance or Covenant Defeasance.

The following shall be the conditions to the application of either Section 8.02(b) or 8.02(c) hereof to the outstanding Notes:

(1)the Issuer must irrevocably deposit with the Trustee, in trust, for the benefit of the Holders, U.S. Legal Tender, U.S. Government Obligations or a combination thereof, in such amounts as will be sufficient (without reinvestment), in the opinion of a nationally recognized firm of independent public accountants selected by the Issuer, to pay the principal of and interest and premium, if any, on the Notes on the stated date for payment or on the redemption date of the Notes,

(2)in the case of Legal Defeasance, the Issuer shall have delivered to the Trustee an Opinion of Counsel in the United States reasonably acceptable to the Trustee confirming that:

(a)the Issuer has received from, or there has been published by the Internal Revenue Service, a ruling, or

(b)since the date of this Indenture, there has been a change in the applicable U.S. federal income tax law,

in either case to the effect that, subject to customary assumptions and qualifications, and based thereon the Holders will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such Legal Defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Legal Defeasance had not occurred,

(3)in the case of Covenant Defeasance, the Issuer shall have delivered to the Trustee an Opinion of Counsel in the United States reasonably acceptable to the Trustee confirming that, subject to customary assumptions and qualifications, the Holders will not recognize income, gain or loss for U.S. federal income tax purposes as a result of such Covenant Defeasance and will be subject to U.S. federal income tax on the same amounts, in the same manner and at the same times as would have been the case if such Covenant Defeasance had not occurred,

(4)no Default shall have occurred and be continuing on the date of such deposit (other than a Default resulting from the borrowing of funds to be applied to such deposit and any similar deposit relating

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to other Indebtedness that is concurrently being defeased and, in each case, the granting of Liens in connection therewith),

(5)the Legal Defeasance or Covenant Defeasance shall not result in a breach or violation of, or constitute a Default under this Indenture or a default under any other material agreement or instrument to which the Issuer or any of its Subsidiaries is a party or by which the Issuer or any of its Subsidiaries is bound (other than any such Default or default resulting solely from the borrowing of funds to be applied to such deposit and any similar deposit relating to other Indebtedness that is concurrently being defeased and, in each case, the granting of Liens in connection therewith),

(6)the Issuer shall have delivered to the Trustee an Officers’ Certificate stating that the deposit was not made by it with the intent of preferring the Holders over any other of its creditors or with the intent of defeating, hindering, delaying or defrauding any other of its creditors or others, and

(7)the Issuer shall have delivered to the Trustee an Officers’ Certificate and an Opinion of Counsel (which Opinion of Counsel may be subject to customary assumptions and qualification), each stating that the conditions provided for in, in the case of the Officers’ Certificate, clauses (1) through (6), as applicable, and, in the case of the Opinion of Counsel, clauses (2), if applicable, and/or (3) and (5) of this Section 8.03 have been complied with.

SECTION 8.04.Application of Trust Money.

The Trustee or Paying Agent shall hold in trust U.S. Legal Tender and U.S. Government Obligations deposited with it pursuant to this Article Eight, and shall apply the deposited U.S. Legal Tender and the money from U.S. Government Obligations in accordance with this Indenture to the payment of the principal of and the interest on the Notes.  The Trustee shall be under no obligation to invest said U.S. Legal Tender and U.S. Government Obligations, except as it may agree with the Issuer.

The Issuer shall pay and indemnify the Trustee against any tax, fee or other charge imposed on or assessed against the U.S. Legal Tender and U.S. Government Obligations deposited pursuant to Section 8.03 or the principal and interest received in respect thereof, other than any such tax, fee or other charge which by law is for the account of the Holders of the outstanding Notes.

Anything in this Article Eight to the contrary notwithstanding, the Trustee shall deliver or pay to the Issuer from time to time upon the Issuer’s request any U.S. Legal Tender and U.S. Government Obligations held by it as provided in Section 8.03 which, in the opinion of a nationally recognized firm of independent public accountants expressed in a written certification thereof delivered to the Trustee, are in excess of the amount thereof that would then be required to be deposited to effect an equivalent Legal Defeasance or Covenant Defeasance.

SECTION 8.05.Repayment to the Issuer.

The Trustee and the Paying Agent shall pay to the Issuer upon request any money held by them for the payment of principal or interest that remains unclaimed for two years; provided that the Trustee or such Paying Agent, before being required to make any payment, may at the expense of the Issuer cause to be published once in a newspaper of general circulation in the City of New York or mail to each Holder entitled to such money notice that such money remains unclaimed and that after a date specified therein which shall be at least 30 days from the date of such publication or mailing any unclaimed balance of such money then remaining will be repaid to the Issuer.  After payment to the Issuer, Holders entitled to such money must look to the Issuer for payment as general creditors unless an applicable law designates another Person.

SECTION 8.06.Reinstatement.

If the Trustee or Paying Agent is unable to apply any U.S. Legal Tender and U.S. Government Obligations in accordance with this Article Eight by reason of any legal proceeding or by reason of any order or judgment of any court or governmental authority enjoining, restraining or otherwise prohibiting such application, or if the funds deposited

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with the Trustee to effect Covenant Defeasance are insufficient to pay the principal of, and interest on, the Notes when due, the Issuer’s obligations under this Indenture, and the Notes shall be revived and reinstated as though no deposit had occurred pursuant to this Article Eight until such time as the Trustee or Paying Agent is permitted to apply all such U.S. Legal Tender and U.S. Government Obligations in accordance with this Article Eight; provided that if the Issuer has made any payment of interest on, or principal of, any Notes because of the reinstatement of its obligations, the Issuer shall be subrogated to the rights of the Holders of such Notes to receive such payment from the U.S. Legal Tender and U.S. Government Obligations held by the Trustee or Paying Agent.

ARTICLE NINE

AMENDMENTS, SUPPLEMENTS AND WAIVERS

SECTION 9.01.Without Consent of Holders.

(a)The Issuer, the Guarantors and the Trustee, together, may amend or supplement this Indenture or the Notes without notice to or consent (which may include consents obtained in connection with a tender offer or exchange offer for Notes) of any Holder:

(1)to cure any ambiguity, defect or inconsistency;

(2)to provide for uncertificated Notes in addition to or in place of certificated Notes;

(3)to provide for the assumption of the Issuer’s or a Guarantor’s obligations to the Holders of the Notes in the case of a merger, consolidation or sale of all or substantially all of the assets, in accordance with Article Five;

(4)to release any Subsidiary Guarantor from any of its obligations under this Indenture (to the extent permitted by this Indenture);

(5)to release the Parent from any of its obligations under this Indenture;

(6)to make any change that would not materially adversely affect the rights of any Holder;

(7)to add covenants for the benefit of the Holders or to surrender any right or power conferred upon the Issuer or any Guarantor;

(8)to evidence and provide for the acceptance and appointment under this Indenture of a successor Trustee;

(9)to conform this Indenture or the Notes to the “Description of the notes” in the Offering Memorandum; or

(10)to comply with requirements of the SEC in order to effect or maintain the qualification of this Indenture under the Trust Indenture Act;

provided that the Issuer has delivered to the Trustee an Opinion of Counsel and an Officers’ Certificate, each stating that such amendment or supplement complies with the provisions of this Section 9.01.

SECTION 9.02.With Consent of Holders.

(a)Subject to Section 6.07, the Issuer, the Guarantors and the Trustee, together, with the written consent of the Holder or Holders of a majority in aggregate principal amount of the outstanding Notes may amend or supplement this Indenture or the Notes, without notice to any other Holders (which may include consents obtained in connection with a tender offer or exchange offer for Notes).  Subject to Section 6.07, the Holder or Holders of a

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majority in aggregate principal amount of the outstanding Notes may waive compliance with any provision of this Indenture or the Notes without notice to any other Holders;

(b)Notwithstanding Section 9.02(a), without the consent of each Holder affected, no amendment or waiver may:

(1)reduce, or change the maturity, of the principal of any Note;

(2)reduce the rate of or extend the time for payment of interest on any Note;

(3)reduce any premium payable upon optional redemption of the Notes, or change the date on which any Notes are subject to redemption (other than provisions of Section 4.09 and Section 4.13, except that if a Change of Control has occurred, no amendment or other modification of the obligation of the Issuer to make a Change of Control Offer relating to such Change of Control shall be made without the consent of each Holder of the Notes affected);

(4)make any Note payable in money or currency other than that stated in the Notes;

(5)modify or change any provision of this Indenture or the related definitions to affect the ranking of the Notes or any Note Guarantee in a manner that adversely affects the Holders;

(6)reduce the percentage of Holders necessary to consent to an amendment or waiver to this Indenture or the Notes;

(7)waive a default in the payment of principal of or premium or interest on any Notes (except a rescission of acceleration of the Notes by the Holders thereof as provided in this Indenture and a waiver of the payment default that resulted from such acceleration);

(8)impair the rights of Holders to receive payments of principal of or interest on the Notes on or after the due date therefor or to institute suit for the enforcement of any payment on the Notes; or

(9)release all or substantially all the Guarantors from their obligations under this Indenture, except as permitted by this Indenture; or

(10)make any change in these amendment and waiver provisions.

(c)It shall not be necessary for the consent of the Holders under this Section 9.02 to approve the particular form of any proposed amendment, supplement or waiver.  It is sufficient if such consent approves the substance thereof.

(d)A consent to any amendment, supplement or waiver under this Indenture by any Holder given in connection with an exchange (in the case of an exchange offer) or a tender (in the case of a tender offer) of such Holder’s Notes will not be rendered invalid by such tender or exchange.

(e)After an amendment, supplement or waiver under this Section 9.02 becomes effective, the Issuer shall mail to the Holders affected thereby a notice briefly describing the amendment, supplement or waiver.  Any failure of the Issuer to mail such notice, or any defect therein, shall not, however, in any way impair or affect the validity of any such amendment, supplement or waiver.

SECTION 9.03.[Reserved].

SECTION 9.04.Compliance with the Trust Indenture Act.

From the date on which this Indenture is qualified under the Trust Indenture Act, every amendment, waiver or supplement of this Indenture or the Notes shall comply with the Trust Indenture Act as then in effect.

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SECTION 9.05.Revocation and Effect of Consents.

Until an amendment, waiver or supplement becomes effective, a consent to it by a Holder is a continuing consent by the Holder and every subsequent Holder of a Note or portion of a Note that evidences the same debt as the consenting Holder’s Note, even if notation of the consent is not made on any Note.  However, any such Holder or subsequent Holder may revoke the consent as to his Note or portion of his Note by notice to the Trustee or the Issuer received before the date on which the Trustee receives an Officers’ Certificate certifying that the Holders of the requisite principal amount of Notes have consented (and not theretofore revoked such consent) to the amendment, supplement or waiver.

The Issuer may, but shall not be obligated to, fix a record date for the purpose of determining the Holders entitled to consent to any amendment, supplement or waiver, which record date shall be at least 30 days prior to the first solicitation of such consent.  If a record date is fixed, then notwithstanding the last sentence of the immediately preceding paragraph, those Persons who were Holders at such record date (or their duly designated proxies), and only those Persons, shall be entitled to revoke any consent previously given, whether or not such Persons continue to be Holders after such record date.  No such consent shall be valid or effective for more than 90 days after such record date.  The Issuer shall inform the Trustee in writing of the fixed record date if applicable.

After an amendment, supplement or waiver becomes effective, it shall bind every Holder, unless it makes a change described in any of clauses (1) through (10) of Section 9.02(b), in which case, the amendment, supplement or waiver shall bind only each Holder of a Note who has consented to it and every subsequent Holder of a Note or portion of a Note that evidences the same debt as the consenting Holder’s Note; provided that any such waiver shall not impair or affect the right of any Holder to receive payment of principal of, and interest on, a Note, on or after the respective due dates therefor, or to bring suit for the enforcement of any such payment on or after such respective dates without the consent of such Holder.

SECTION 9.06.Notation on or Exchange of Notes.

If an amendment, supplement or waiver changes the terms of a Note, the Issuer may require the Holder of the Note to deliver it to the Trustee.  The Issuer shall provide the Trustee with an appropriate notation on the Note about the changed terms and cause the Trustee to return it to the Holder at the Issuer’s expense.  Alternatively, if the Issuer or the Trustee so determines, the Issuer in exchange for the Note shall issue, and the Trustee shall authenticate, a new Note that reflects the changed terms.  Failure to make the appropriate notation or issue a new Note shall not affect the validity and effect of such amendment, supplement or waiver.

SECTION 9.07.Trustee To Sign Amendments, Etc.

The Trustee shall execute any amendment, supplement or waiver authorized pursuant to this Article Nine; provided that the Trustee may, but shall not be obligated to, execute any such amendment, supplement or waiver which affects the Trustee’s own rights, duties or immunities under this Indenture.  The Trustee shall be entitled to receive, and shall be fully protected in relying upon, an Opinion of Counsel and an Officers’ Certificate each stating that the execution of any amendment, supplement or waiver authorized pursuant to this Article Nine is authorized or permitted by this Indenture and constitutes legal, valid and binding obligations of the Issuer enforceable in accordance with its terms.  Such Opinion of Counsel shall be at the expense of the Issuer.

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ARTICLE TEN

[RESERVED]

ARTICLE ELEVEN

NOTE GUARANTEE

SECTION 11.01.Guarantee.

Subject to this Article 11, each of the Guarantors hereby, jointly and severally, unconditionally guarantees to each Holder of a Note authenticated and delivered by the Trustee and to the Trustee and its successors and assigns, irrespective of the validity and enforceability of this Indenture, the Notes or the obligations of the Issuer hereunder or thereunder, that:  (a) the principal of and interest on the Notes will be promptly paid in full when due, whether at maturity, by acceleration, redemption or otherwise, and interest on the overdue principal of and interest on the Notes, if any, if lawful, and all other obligations of the Issuer to the Holders or the Trustee hereunder or thereunder will be promptly paid in full or performed, all in accordance with the terms hereof and thereof; and (b) in case of any extension of time of payment or renewal of any Notes or any of such other obligations, that same will be promptly paid in full when due or performed in accordance with the terms of the extension or renewal, whether at stated maturity, by acceleration or otherwise.  Failing payment when due of any amount so guaranteed or any performance so guaranteed for whatever reason, the Guarantors shall be jointly and severally obligated to pay the same immediately.  Each Guarantor agrees that this is a guarantee of payment and not a guarantee of collection.

The Guarantors hereby agree that their obligations hereunder shall be unconditional, irrespective of the validity, regularity or enforceability of the Notes or this Indenture, the absence of any action to enforce the same, any waiver or consent by any Holder of the Notes with respect to any provisions hereof or thereof, the recovery of any judgment against the Issuer, any action to enforce the same or any other circumstance which might otherwise constitute a legal or equitable discharge or defense of a guarantor.  Each Guarantor hereby waives, to the extent permitted by applicable law, diligence, presentment, demand of payment, filing of claims with a court in the event of insolvency or bankruptcy of the Issuer, any right to require a proceeding first against the Issuer, protest, notice and all demands whatsoever and covenant that this Note Guarantee shall not be discharged except by complete performance of the obligations contained in the Notes and this Indenture.

If any Holder or the Trustee is required by any court or otherwise to return to the Issuer, the Guarantors or any custodian, trustee, liquidator or other similar official acting in relation to either the Issuer or the Guarantors, any amount paid by either to the Trustee or such Holder, this Note Guarantee, to the extent theretofore discharged, shall be reinstated in full force and effect.

Each Guarantor agrees that it shall not be entitled to any right of subrogation in relation to the Holders in respect of any obligations guaranteed hereby until payment in full of all obligations guaranteed hereby.  Each Guarantor further agrees that, as between the Guarantors, on the one hand, and the Holders and the Trustee, on the other hand, (x) the maturity of the obligations guaranteed hereby may be accelerated as provided in Article Six hereof for the purposes of this Note Guarantee, notwithstanding any stay, injunction or other prohibition preventing such acceleration in respect of the obligations guaranteed hereby, and (y) in the event of any declaration of acceleration of such obligations as provided in Article Six hereof, such obligations (whether or not due and payable) shall forthwith become due and payable by the Guarantors for the purpose of this Note Guarantee.

SECTION 11.02.[Reserved].

SECTION 11.03.Limitation on Guarantor Liability.

Each Subsidiary Guarantor, and by its acceptance of Notes, each Holder, hereby confirms that it is the intention of all such parties that the Note Guarantee of such Guarantor not constitute a fraudulent transfer or conveyance for purposes of Bankruptcy Law, the Uniform Fraudulent Conveyance Act, the Uniform Fraudulent Transfer Act or any similar federal or state law to the extent applicable to any Note Guarantee.  To effectuate the foregoing

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intention, the Trustee, the Holders and the Subsidiary Guarantors hereby irrevocably agree that the obligations of such Guarantor will, after giving effect to such maximum amount and all other contingent and fixed liabilities of such Guarantor that are relevant under such laws, and after giving effect to any collections from, rights to receive contribution from or payments made by or on behalf of any other Subsidiary Guarantor in respect of the obligations of such other Guarantor under this Article Eleven, result in the obligations of such Guarantor under its Note Guarantee not constituting a fraudulent transfer or conveyance.  Each Subsidiary Guarantor that makes a payment for distribution under its Note Guarantee is entitled to a contribution from each other Subsidiary Guarantor in a pro rata amount based on the adjusted net assets of each Subsidiary Guarantor.

SECTION 11.04.[Reserved].

SECTION 11.05.Release of a Subsidiary Guarantor; Release of Parent.

(a)A Subsidiary Guarantor shall be released from its obligations under this Indenture and the Registration Rights Agreement:

(1)in the event of a sale or other disposition of all or substantially all of the assets of such Subsidiary Guarantor, by way of merger, consolidation or otherwise, or a sale or other disposition of all of the Equity Interests of such Subsidiary Guarantor then held by the Issuer and the Restricted Subsidiaries;

(2)if such Subsidiary Guarantor is designated as an Unrestricted Subsidiary or otherwise ceases to be a Restricted Subsidiary, in each case in accordance with the provisions of this Indenture, upon effectiveness of such designation or when it first ceases to be a Restricted Subsidiary, respectively; or

(3)upon the exercise by the Issuer of its legal defeasance option or covenant defeasance option under Section 8.02 or the discharge of the Issuer’s obligations under this Indenture pursuant to Section 8.01.

The Trustee shall execute an appropriate instrument prepared by the Issuer evidencing the release of a Subsidiary Guarantor from its obligations under this Indenture upon receipt of a request by the Issuer or such Subsidiary Guarantor accompanied by an Officers’ Certificate and an Opinion of Counsel certifying as to the compliance with this Section 11.05; provided, however, that the legal counsel delivering such Opinion of Counsel may rely as to matters of fact on one or more Officers’ Certificates of the Issuer.

Nothing contained in this Indenture or in any of the Notes shall prevent any consolidation or merger of a Guarantor with or into the Issuer (in which case such Guarantor shall no longer be a Guarantor) or another Guarantor or shall prevent any sale or conveyance of the property of a Guarantor as an entirety or substantially as an entirety to the Issuer or another Guarantor.

(b)Notwithstanding any other provisions of this Indenture or the Notes, the Guarantee of the Parent may be released at any time without the consent of any Holder.

ARTICLE TWELVE

MISCELLANEOUS

SECTION 12.01.Trust Indenture Act Controls.

If any provision of this Indenture limits, qualifies, or conflicts with another provision which is required or deemed to be included in this Indenture by the Trust Indenture Act, such required or deemed provision shall control.

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SECTION 12.02.Notices.

Any notices or other communications required or permitted hereunder shall be in writing, and shall be sufficiently given if made by hand delivery, by telex, by nationally recognized overnight courier service, by telecopier or registered or certified mail, postage prepaid, return receipt requested, addressed as follows:

if to the Issuer or a Guarantor:
	CPI International Acquisition, Inc. (to be renamed CPI International, Inc.)
	c/o The Veritas Capital Fund IV, L.P.
	590 Madison Avenue, New York, New York 10022
	Attention: Jeffrey Kelly
	Telephone:	(212) 415-6716
	Facsimile:	(212) 688-9411
if to the Trustee:
	The Bank of New York Mellon Trust Company, N. A.
	700 S. Flower Street, Suite 500
	Los Angeles, California 90017
	Attention: Corporate Trust Administration
	Facsimile:	(213) 630 6289

The Trustee agrees to accept and act upon instructions or directions pursuant to this Indenture sent by unsecured e-mail, facsimile transmission or other similar unsecured electronic methods.  If the party elects to give the Trustee e-mail or facsimile instructions (or instructions by a similar electronic method) and the Trustee in its discretion elects to act upon such instructions, the Trustee’s understanding of such instructions shall be deemed controlling. The Trustee shall not be liable for any losses, costs or expenses arising directly or indirectly from the Trustee’s reliance upon and compliance with such instructions notwithstanding such instructions conflict or are inconsistent with a subsequent written instruction. The party providing electronic instructions agrees to assume all risks arising out of the use of such electronic methods to submit instructions and directions to the Trustee, including without limitation the risk of the Trustee acting on unauthorized instructions, and the risk of interception and misuse by third parties.

Notwithstanding anything to the contrary contained herein, as long as the Notes are in the form of a Global Note, notice to the Holders may be made electronically in accordance with procedures of the Depository.

Each of the Issuer and the Trustee by written notice to each other such Person may designate additional or different addresses for notices to such Person.  Any notice or communication to the Issuer and the Trustee, shall be deemed to have been given or made as of the date so delivered if personally delivered; when replied to; when receipt is acknowledged, if telecopied; five (5) calendar days after mailing if sent by registered or certified mail, postage prepaid (except that a notice of change of address shall not be deemed to have been given until actually received by the addressee); and next Business Day if by nationally recognized overnight courier service.

Any notice or communication mailed to a Holder shall be mailed to him by first class mail or other equivalent means at his address as it appears on the registration books of the Registrar and shall be sufficiently given to him if so mailed within the time prescribed.

Failure to mail a notice or communication to a Holder or any defect in it shall not affect its sufficiency with respect to other Holders.  If a notice or communication is mailed in the manner provided above, it is duly given, whether or not the addressee receives it.

69

SECTION 12.03.Communications by Holders with Other Holders.

Holders may communicate pursuant to Trust Indenture Act § 312(b) with other Holders with respect to their rights under this Indenture, the Notes or the Note Guarantees.  The Issuer, the Trustee, the Registrar and any other Person shall have the protection of Trust Indenture Act § 312(c).

SECTION 12.04.Certificate and Opinion as to Conditions Precedent.

Upon any request or application by the Issuer to the Trustee to take any action under this Indenture, the Issuer shall furnish to the Trustee at the request of the Trustee:

(1)an Officers’ Certificate, in form and substance satisfactory to the Trustee, stating that, in the opinion of the signers, all conditions precedent to be performed or effected by the Issuer, if any, provided for in this Indenture relating to the proposed action have been complied with; and

(2)an Opinion of Counsel stating that, in the opinion of such counsel, all such conditions precedent have been complied with (provided, that such Opinion of Counsel shall not be given in connection with the issuance of the Initial Notes).

SECTION 12.05.Statements Required in Certificate or Opinion.

Each certificate or opinion with respect to compliance with a condition or covenant provided for in this Indenture, other than the Officers’ Certificate required by Section 4.06, shall include:

(1)a statement that the Person making such certificate or opinion has read such covenant or condition;

(2)a brief statement as to the nature and scope of the examination or investigation upon which the statements or opinions contained in such certificate or opinion are based;

(3)a statement that, in the opinion of such Person, he has made such examination or investigation as is necessary to enable him to express an informed opinion as to whether or not such covenant or condition has been complied with or satisfied; and

(4)a statement as to whether or not, in the opinion of each such Person, such condition or covenant has been complied with; provided, however, that with respect to matters of fact, an Opinion of Counsel may rely on an Officers’ Certificate or certificates of public officials.

SECTION 12.06.Rules by Paying Agent or Registrar.

The Paying Agent or Registrar may make reasonable rules and set reasonable requirements for their functions.

SECTION 12.07.Legal Holidays.

If a payment date is not a Business Day, payment may be made on the next succeeding day that is a Business Day.

SECTION 12.08.Governing Law.

This Indenture (including the Note Guarantees) and the Notes will be governed by and construed in accordance with the laws of the State of New York.

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SECTION 12.09.No Adverse Interpretation of Other Agreements.

This Indenture may not be used to interpret another indenture, loan or debt agreement of any of the Issuer or any of its Subsidiaries.  Any such indenture, loan or debt agreement may not be used to interpret this Indenture.

SECTION 12.10.No Recourse Against Others.

No director, officer, employee, incorporator, stockholder, member or manager of the Issuer or any Guarantor shall have any liability for any obligations of the Issuer under the Notes or this Indenture or of any Guarantor under its Note Guarantee or this Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation.  Each Holder of Notes by accepting a Note waives and releases all such liability.  Such waiver and release are part of the consideration for issuance of the Notes.

SECTION 12.11.Successors.

All agreements of the Issuer and the Guarantors in this Indenture and the Notes shall bind their respective successors.  All agreements of the Trustee in this Indenture shall bind its successor.

SECTION 12.12.Duplicate Originals.

All parties may sign any number of copies of this Indenture.  Each signed copy or counterpart shall be an original, but all of them together shall represent the same agreement.

SECTION 12.13.Severability.

To the extent permitted by applicable law, in case any one or more of the provisions in this Indenture or in the Notes shall be 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 shall not in any way be affected or impaired thereby, it being intended that all of the provisions hereof shall be enforceable to the full extent permitted by law.

SECTION 12.14.Waiver of Jury Trial.

EACH OF THE ISSUER, EACH GUARANTOR AND THE TRUSTEE HEREBY IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATING TO THIS INDENTURE, THE NOTES OR THE TRANSACTION CONTEMPLATED HEREBY.

SECTION 12.15.Force Majeure.

In no event shall the Trustee be responsible or liable for any failure or delay in the performance of its obligations hereunder arising out of or caused by, directly or indirectly, forces beyond its control, including, without limitation, strikes, work stoppages, accidents, acts of war or terrorism, civil or military disturbances, nuclear or natural catastrophes or acts of God, and interruptions, loss or malfunctions of utilities, communications or computer (software and hardware) services; it being understood that the Trustee shall use reasonable efforts which are consistent with accepted practices in the banking industry to resume performance as soon as practicable under the circumstances.

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SIGNATURES

IN WITNESS WHEREOF, the parties hereto have caused this Indenture to be duly executed all as of the date first written above.

CPI INTERNATIONAL ACQUISITION, INC. (to be renamed CPI INTERNATIONAL, INC.),
as Issuer
By:	/s/ Robert B. McKeon
	Name: Robert B. McKeon
	Title: President
CPI INTERNATIONAL HOLDING CORP.,
as Guarantor
By:	/s/ Robert B. McKeon
	Name: Robert B. McKeon
	Title: President
THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A., as Trustee
By:	/s/ Alex Briffett
	Name: John A. (Alex) Briffett
	Title: Authorized Signatory

S-1

EXHIBIT A

[Insert the Global Note Legend, if applicable pursuant to the provisions of the Indenture]

[Insert the Private Placement Legend, if applicable pursuant to the provisions of the Indenture]

CPI INTERNATIONAL ACQUISITION, INC.
(to be renamed CPI INTERNATIONAL, INC.)
8.00% Senior Notes due 2018

	CUSIP No.
No.	$

CPI INTERNATIONAL ACQUISITION, INC. (to be renamed CPI INTERNATIONAL, INC.), a Delaware corporation (the “Issuer”), for value received promise to pay to                        or its registered assigns, the principal sum of                           [or such other amount as is provided in a schedule attached hereto](1) on February 15, 2018.

Interest Payment Dates:  February 15 and August 15, commencing August 15, 2011.

Record Dates:  February 1 and August 1.

Reference is made to the further provisions of this Note contained herein, which will for all purposes have the same effect as if set forth at this place.

(1)This language should be included only if the Note is issued in global form.

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IN WITNESS WHEREOF, the Issuer has caused this Note to be signed manually or by facsimile by its duly authorized officer.

Dated:
	CPI INTERNATIONAL ACQUISITION, INC.
	(to be renamed CPI INTERNATIONAL, INC.),
	as Issuer
	By:
		Name:
		Title:

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[FORM OF] TRUSTEE’S CERTIFICATE OF AUTHENTICATION

This is one of the 8.00% Senior Notes due 2018 described in the within-mentioned Indenture.

Dated:
	THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.,
	as Trustee
	By:
	Authorized Signatory

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(Reverse of Note)

8.00% Senior Notes due 2018

Capitalized terms used herein shall have the meanings assigned to them in the Indenture referred to below unless otherwise indicated.

SECTION 1.  Interest.  CPI International Acquisition, Inc., a Delaware corporation (the “Issuer”) promises to pay interest on the principal amount of this Note at 8.00% per annum from February 11, 2011 until maturity.  The Issuer will pay interest semi-annually on February 15 and August 15 of each year, or if any such day is not a Business Day, on the next succeeding Business Day (each an “Interest Payment Date”), commencing August 15, 2011.  Interest on the Notes will accrue from the most recent date to which interest has been paid or, if no interest has been paid, from the date of original issuance.  The Issuer shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue principal and premium, if any, from time to time on demand to the extent lawful at the interest rate applicable to the Notes; it shall pay interest (including post-petition interest in any proceeding under any Bankruptcy Law) on overdue installments of interest (without regard to any applicable grace periods) from time to time on demand at the same rate to the extent lawful.  Interest will be computed on the basis of a 360-day year of twelve 30-day months.

SECTION 2.  Method of Payment.  The Issuer will pay interest on the Notes to the Persons who are registered Holders of Notes at the close of business on the February 1 or August 1 next preceding the Interest Payment Date, even if such Notes are canceled after such record date and on or before such Interest Payment Date, except as provided in Section 2.12 of the Indenture with respect to defaulted interest.  The Notes will be issued in denominations of $1,000 and integral multiples of $1,000.  The Issuer shall pay principal, premium, if any, and interest on the Notes in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts (“U.S. Legal Tender”).  Principal, premium, if any, and interest on the Notes will be payable at the office or agency of the Issuer maintained for such purpose except that, at the option of the Issuer, the payment of interest may be made by check mailed to the Holders of the Notes at their respective addresses set forth in the register of Holders of Notes; provided that for Holders of at least $5.0 million in principal amount of the Notes that have given wire transfer instructions to the Issuer at least ten Business Days prior to the applicable payment date, the Issuer will make all payments of principal, premium and interest by wire transfer of immediately available funds to the accounts specified by the Holders thereof.  Notwithstanding the foregoing, all payments with respect to Notes represented by one or more global notes registered in the name of or held by DTC or its nominee will be made by wire transfer of immediately available funds to the account specified by the Holder. Until otherwise designated by the Issuer, the Issuer’s office or agency in New York will be the office of the Trustee maintained for such purpose.

SECTION 3.  Paying Agent and Registrar.  Initially, The Bank of New York Mellon Trust Company, N.A., the Trustee under the Indenture, will act as Paying Agent and Registrar.  The Issuer may change any Paying Agent or Registrar without notice to any Holder.  Except as provided in the Indenture, the Issuer or any of its Subsidiaries may act in any such capacity.

SECTION 4.  Indenture.  The Issuer issued the Notes under an Indenture dated as of February 11, 2011 (“Indenture”) by and among the Issuer, the Guarantors and the Trustee.  The terms of the Notes include those stated in the Indenture and those made part of the Indenture by reference to the Trust Indenture Act of 1939, as amended (15 U.S. Code §§ 77aaa-77bbbb) (the “Trust Indenture Act”).  The Notes are subject to all such terms, and Holders are referred to the Indenture and the Trust Indenture Act for a statement of such terms.

SECTION 5.  Optional Redemption.  (a) At any time or from time to time on or after February 15, 2015, the Issuer, at its option, may redeem the Notes, in whole or in part, at the redemption prices (expressed as percentages of principal amount) set forth below, together with accrued and unpaid interest thereon, if any, to the applicable Redemption Date, if redeemed during the twelve-month period beginning on February 15 of the years indicated:

Year	Percentage
2015	104.00	%

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Year	Percentage
2016	102.00	%
2017 and thereafter	100.00	%

(b)At any time prior to February 15, 2015, the Issuer may redeem all or a part of the Notes at a redemption price equal to 100% of the principal amount of the Notes to be redeemed plus the Applicable Premium as of, plus accrued and unpaid interest, if any, to, the Redemption Date.

(c)At any time, and on one or more occasions, prior to February 15, 2014, the Issuer may redeem up to 35% of the aggregate principal amount of Notes with the net cash proceeds of one or more Qualified Equity Offerings at a redemption price equal to 108% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest thereon, if any, to the Redemption Date; provided that (i) at least 65% of the aggregate principal amount of Notes issued under the Indenture remains outstanding immediately after the occurrence of such redemption (excluding in such calculation Notes held by Parent and its Subsidiaries) and (ii) such redemption shall occur within 120 days of the date of the closing of any such Qualified Equity Offering.  Notice of any redemption upon any Qualified Equity Offering may be given prior to the completion thereof, and any such redemption or notice may, at the Issuer’s discretion, be subject to the closing of the related Qualified Equity Offering.

SECTION 6.  [Reserved].

SECTION 7.  Notice of Redemption.  Notice of redemption will be mailed by first class mail at least 30 days but not more than 60 days before the redemption date to each Holder of Notes to be redeemed at its registered address.  Notes in denominations larger than $1,000 may be redeemed in part.  If any Note is to be redeemed in part only, the notice of redemption that relates to such Note shall state the portion of the principal amount thereof to be redeemed.  A new Note in principal amount equal to the unredeemed portion thereof will be issued in the name of the Holder thereof upon cancellation of the original Note.  On and after the redemption date interest ceases to accrue on Notes or portions thereof called for redemption.

SECTION 8.  Mandatory Redemption.  The Issuer shall not be required to make mandatory redemption payments with respect to the Notes, except as described in Section 9.

SECTION 9.  Repurchase at Option of Holder.  Upon the occurrence of a Change of Control, and subject to certain conditions set forth in the Indenture, the Issuer will be required to offer to purchase all of the outstanding Notes at a purchase price equal to 101% of the principal amount thereof, plus accrued and unpaid interest, if any, thereon to the date of repurchase.

The Issuer is, subject to certain conditions and exceptions, obligated to make an offer to purchase Notes at 100% of their principal amount, plus accrued and unpaid interest, if any, thereon to the date of repurchase, with certain net cash proceeds of certain sales or other dispositions of assets in accordance with the Indenture.

SECTION 10.  Denominations, Transfer, Exchange.  The Notes are in registered form without coupons in denominations of $1,000 and integral multiples of $1,000.  The transfer of Notes may be registered and Notes may be exchanged as provided in the Indenture.  The Registrar and the Trustee may require a Holder, among other things, to furnish appropriate endorsements and transfer documents and the Issuer may require a Holder to pay any taxes and fees required by law or permitted by the Indenture.  The Issuer and the Registrar are not required to transfer or exchange any Note selected for redemption.  Also, the Issuer and the Registrar are not required to transfer or exchange any Notes for a period of 15 days before a selection of Notes to be redeemed.

SECTION 11.  Persons Deemed Owners.  The registered Holder of a Note may be treated as its owner for all purposes.

SECTION 12.  Amendment, Supplement and Waiver.  Subject to certain exceptions, the Indenture and the Notes may be amended or supplemented with the written consent of the Holders of at least a majority in aggregate principal amount of the Notes then outstanding, and any existing Default or compliance with any provision may be

A-5

waived with the consent of the Holders of a majority in aggregate principal amount of the Notes then outstanding.  Without notice to or consent of any Holder, the parties thereto may amend or supplement the Indenture and the Notes to, among other things, cure any ambiguity, defect or inconsistency in the Indenture, provide for uncertificated Notes in addition to certificated Notes, comply with any requirements of the SEC in connection with the qualification of the Indenture under the Trust Indenture Act, or make any change that does not materially adversely affect the rights of any Holder of a Note.

SECTION 13.  Defaults and Remedies.  If a Default occurs and is continuing, the Trustee or the Holders of at least 25% in principal amount of the then outstanding Notes generally may declare all the Notes to be due and payable immediately.  Notwithstanding the foregoing, in the case of a Default arising from certain events of bankruptcy or insolvency as set forth in the Indenture, with respect to the Issuer, all outstanding Notes will become due and payable without further action or notice.  Holders of the Notes may not enforce the Indenture or the Notes except as provided in the Indenture.  Subject to certain limitations, Holders of a majority in principal amount of the then outstanding Notes may direct the Trustee in its exercise of any trust or power.  The Trustee may withhold from Holders of the Notes notice of any continuing Default (except a Default relating to the payment of principal or interest including an accelerated payment or the failure to make a payment on the Change of Control Payment Date or the Net Proceeds Payment Date pursuant to a Net Proceeds Offer or a Default in complying with the provisions of Article Five of the Indenture) if it determines that withholding notice is in their interest.  The Holders of a majority in aggregate principal amount of the Notes then outstanding by notice to the Trustee may on behalf of the Holders of all of the Notes waive any existing Default and its consequences under the Indenture except a continuing Default in the payment of interest on, or the principal of, or the premium on, the Notes.

SECTION 14.  Restrictive Covenants.  The Indenture contains certain covenants that, among other things, limit the ability of the Issuer and its Restricted Subsidiaries to make restricted payments, to incur indebtedness, to create liens, to sell assets, to permit restrictions on dividends and other payments by Restricted Subsidiaries of the Issuer, to consolidate, merge or sell all or substantially all of its assets or to engage in transactions with affiliates.  The limitations are subject to a number of important qualifications and exceptions.  The Issuer must annually report to the Trustee on compliance with such limitations and other provisions in the Indenture.

SECTION 15.  No Recourse Against Others.  No director, officer, employee, incorporator, stockholder, member or manager of the Issuer or any Guarantor shall have any liability for any obligations of the Issuer under the Notes or the Indenture, or of any Guarantor under its Note Guarantee or the Indenture or for any claim based on, in respect of, or by reason of, such obligations or their creation.  Each Holder of Notes by accepting a Note waives and releases all such liability.  The waiver and release are part of the consideration for issuance of the Notes.

SECTION 16.  Note Guarantees.  This Note will be entitled to the benefits of certain Note Guarantees made for the benefit of the Holders.  Reference is hereby made to the Indenture for a statement of the respective rights, limitations of rights, duties and obligations thereunder of the Guarantors, the Trustee and the Holders.

SECTION 17.  Trustee Dealings with the Issuer.  Subject to certain terms, the Trustee under the Indenture, in its individual or any other capacity, may become the owner or pledgee of Notes and may otherwise deal with the Issuer, their Subsidiaries or their respective Affiliates as if it were not the Trustee.

SECTION 18.  Authentication.  This Note shall not be valid until authenticated by the manual signature of the Trustee or an authenticating agent.

SECTION 19.  Abbreviations.  Customary abbreviations may be used in the name of a Holder or an assignee, such as:  TEN COM (= tenants in common), TEN ENT (= tenants by the entirety), JT TEN (= joint tenants with right of survivorship and not as tenants in common), CUST (= Custodian), and U/G/M/A (= Uniform Gifts to Minors Act).

SECTION 20.  Additional Rights of Holders of Restricted Global Notes and Restricted Definitive Notes.  Pursuant to, but subject to the exceptions in, the Registration Rights Agreement, the Issuer and the Guarantors will be obligated to consummate an exchange offer pursuant to which the Holder of this Note shall have the right to exchange this Note for an 8.00% Senior Note due 2018 of the Issuer which shall have been registered under the Securities Act, in like principal amount and having terms identical in all material respects to this Note (except that such

A-6

note shall not be entitled to Additional Interest and shall not contain terms with respect to transfer restrictions).  The Holders shall be entitled to receive certain Additional Interest in the event such exchange offer is not consummated or the Notes are not offered for resale and upon certain other conditions, all pursuant to and in accordance with the terms of the Registration Rights Agreement.(2)

SECTION 21.  CUSIP and ISIN Numbers.  Pursuant to a recommendation promulgated by the Committee on Uniform Security Identification Procedures, the Issuer has caused CUSIP and ISIN numbers to be printed on the Notes and the Trustee may use CUSIP or ISIN numbers in notices of redemption as a convenience to Holders.  No representation is made as to the accuracy of such numbers either as printed on the Notes or as contained in any notice of redemption and reliance may be placed only on the other identification numbers placed thereon.

SECTION 22.  Governing Law.  This Note shall be governed by, and construed in accordance with, the laws of the State of New York.

The Issuer will furnish to any Holder upon written request and without charge a copy of the Indenture.

(2)This Section not to appear on Exchange Notes or Private Exchange Notes or Additional Notes unless required by the terms of such Additional Notes.

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ASSIGNMENT FORM

I or we assign and transfer this Note to

(Print or type name, address and zip code of assignee or transferee)

(Insert Social Security or other identifying number of assignee or transferee)

and irrevocably appoint                                                              agent to transfer this Note on the books of the Issuer.  The agent may substitute another to act for him.

Dated:	Signed:
		(Sign exactly as name appears on the other side of this Note)

Signature Guarantee:
	Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor program reasonably acceptable to the Trustee)

In connection with any transfer of this Note occurring prior to the date which is the date following the second anniversary of the original issuance of this Note, the undersigned confirms that it has not utilized any general solicitation or general advertising in connection with the transfer and is making the transfer pursuant to one of the following:

[Check One]

(1) oto the Issuer or a subsidiary thereof; or

(2) oto a person who the transferor reasonably believes is a “qualified institutional buyer” pursuant to and in compliance with Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”); or

(3) oto an institutional “accredited investor” (as defined in Rule 501(a)(1), (2), (3) or (7) under the Securities Act) that has furnished to the Trustee a signed letter containing certain representations and agreements (the form of which letter can be obtained from the Trustee); or

(4) ooutside the United States to a non-”U.S. person” as defined in Rule 902 of Regulation S under the Securities Act in compliance with Rule 904 of Regulation S under the Securities Act; or

(5) opursuant to the exemption from registration provided by Rule 144 under the Securities Act; or

(6) opursuant to an effective registration statement under the Securities Act.

and unless the box below is checked, the undersigned confirms that such Note is not being transferred to an “affiliate” of the Issuer as defined in Rule 144 under the Securities Act (an “Affiliate”):

oThe transferee is an Affiliate of the Issuer.

Unless one of the foregoing items (1) through (6) is checked, the Trustee will refuse to register any of the Notes evidenced by this certificate in the name of any person other than the registered Holder thereof; provided, however, that if item (3), (4) or (5) is checked, the Issuer or the Trustee may require, prior to registering any such transfer of the Notes, in their sole discretion, such written legal opinions, certifications (including an investment letter in the case of box (3) or (4)) and other information as the Trustee or the Issuer has reasonably requested to

confirm that such transfer is being made pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act.

If none of the foregoing items (1) through (6) are checked, the Trustee or Registrar shall not be obligated to register this Note in the name of any person other than the Holder hereof unless and until the conditions to any such transfer of registration set forth herein and in Section 2.16 of the Indenture shall have been satisfied.

Dated:		Signed:
			(Sign exactly as name appears on the other side of this Note)
Signature Guarantee:
	Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor program reasonably acceptable to the Trustee)

TO BE COMPLETED BY PURCHASER IF (2) ABOVE IS CHECKED

The undersigned represents and warrants that it is purchasing this Note for its own account or an account with respect to which it exercises sole investment discretion and that it and any such account is a “qualified institutional buyer” within the meaning of Rule 144A under the Securities Act and is aware that the sale to it is being made in reliance on Rule 144A and acknowledges that it has received such information regarding the Issuer as the undersigned has requested pursuant to Rule 144A or has determined not to request such information and that it is aware that the transferor is relying upon the undersigned’s foregoing representations in order to claim the exemption from registration provided by Rule 144A.

Dated:
	NOTICE:	To be executed by an executive officer

2

OPTION OF HOLDER TO ELECT PURCHASE

If you want to elect to have this Note purchased by the Issuer pursuant to Section 4.09 or Section 4.13 of the Indenture, check the appropriate box:

Section 4.09 o Section 4.13 o

If you want to elect to have only part of this Note purchased by the Issuer pursuant to Section 4.09 or Section 4.13 of the Indenture, state the amount (in denominations of $1,000 and integral multiples of $1,000):  $             

Dated:		Signed:
			(Sign exactly as name appears on the other side of this Note)
Signature Guarantee:
	Participant in a recognized Signature Guarantee Medallion Program (or other signature guarantor program reasonably acceptable to the Trustee)

3

SCHEDULE OF EXCHANGES OF INTERESTS IN THE GLOBAL NOTE(3)

The following exchanges of a part of this Global Note for an interest in another Global Note or for a Physical Note, or exchanges of a part of another Global Note or Physical Note for an interest in this Global Note, have been made:

Date of Exchange Amount of decrease in
Principal Amount of
this Global Note Amount of increase in
Principal Amount of
this Global Note Principal Amount of
this Global Note
following such decrease
(or increase) Signature of
authorized officer of
Trustee or Note
Custodian

(3)This schedule should be included only if the Note is issued in global form.

4

EXHIBIT B

FORM OF LEGENDS

Each Global Note and Physical Note that constitutes a Restricted Security shall bear the following legend (the “Private Placement Legend”) on the face thereof until after the second anniversary of the Issue Date, unless otherwise agreed by the Issuer and the Holder thereof or if such legend is no longer required by Section 2.16(f) of the Indenture:

THE SECURITY (OR ITS PREDECESSOR) EVIDENCED BY THIS CERTIFICATE WAS ORIGINALLY ISSUED IN A TRANSACTION EXEMPT FROM REGISTRATION UNDER SECTION 5 OF THE U.S. SECURITIES ACT OF 1933, AND THE SECURITY EVIDENCED BY THIS CERTIFICATE MAY NOT BE OFFERED, SOLD, PLEDGED OR OTHERWISE TRANSFERRED IN THE ABSENCE OF REGISTRATION OR AN APPLICABLE EXEMPTION FROM THE SECURITIES ACT.  EACH PURCHASER OF THE SECURITY EVIDENCED BY THIS CERTIFICATE (1) BY ITS ACQUISITION OF THE SECURITY REPRESENTS THAT (A) IT IS A “QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING THE SECURITY EVIDENCED BY THIS CERTIFICATE IN AN OFFSHORE TRANSACTION IN COMPLIANCE WITH REGULATION S UNDER THE SECURITIES ACT, AND (2) IS HEREBY NOTIFIED THAT THE SELLER MAY BE RELYING ON THE EXEMPTION FROM THE PROVISIONS OF SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE 144A OR ANOTHER EXEMPTION UNDER THE SECURITIES ACT.  THE HOLDER OF THE SECURITY EVIDENCED BY THIS CERTIFICATE AGREES FOR THE BENEFIT OF THE ISSUER AND THE GUARANTORS THAT (X) THIS SECURITY MAY BE RESOLD, PLEDGED OR OTHERWISE TRANSFERRED ONLY (1)(A) TO A PERSON WHO THE SELLER REASONABLY BELIEVES IS A QUALIFIED INSTITUTIONAL BUYER (AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144A, (B) IN A TRANSACTION MEETING THE REQUIREMENTS OF RULE 144 UNDER THE SECURITIES ACT, IF AVAILABLE, (C) OUTSIDE THE UNITED STATES TO A PERSON THAT IS NOT A U.S. PERSON (AS DEFINED IN RULE 902 UNDER THE SECURITIES ACT) IN A TRANSACTION MEETING THE REQUIREMENTS OF REGULATION S UNDER THE SECURITIES ACT, (D) TO AN ACCREDITED INVESTOR (WITHIN THE MEANING OF RULE 501(a)(1), (2), (3), OR (7) UNDER THE SECURITIES ACT) (AN “INSTITUTIONAL ACCREDITED INVESTOR”) THAT IS PURCHASING AT LEAST $250,000 OF NOTES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF AN INSTITUTIONAL ACCREDITED INVESTOR (AND BASED UPON AN OPINION OF COUNSEL IF THE ISSUER SO REQUESTS), (2) TO THE ISSUER OR ANY OF ITS SUBSIDIARIES OR (3) UNDER AN EFFECTIVE REGISTRATION STATEMENT AND, IN EACH CASE, IN COMPLIANCE WITH ANY APPLICABLE SECURITIES LAWS OF ANY STATE OF THE UNITED STATES OR ANY OTHER APPLICABLE JURISDICTION AND (Y) THE HOLDER WILL, AND EACH SUBSEQUENT HOLDER IS REQUIRED TO, NOTIFY ANY PURCHASER FROM IT OF THE SECURITY EVIDENCED BY THIS CERTIFICATE OF THE RESALE RESTRICTIONS DESCRIBED IN (X) ABOVE.  IN CONNECTION WITH ANY TRANSFER OF THIS SECURITY WITHIN ONE YEAR AFTER THE ORIGINAL ISSUANCE OF THIS SECURITY OR IF THE PROPOSED TRANSFEREE IS AN INSTITUTIONAL ACCREDITED INVESTOR, THE HOLDER MUST, PRIOR TO SUCH TRANSFER, FURNISH TO THE TRUSTEE AND THE ISSUER SUCH CERTIFICATIONS, LEGAL OPINIONS OR OTHER INFORMATION AS EITHER OF THEM MAY REASONABLY REQUIRE TO CONFIRM THAT SUCH TRANSFER IS BEING MADE PURSUANT TO AN EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT.

Each Global Note authenticated and delivered hereunder shall also bear the following legend:

THIS NOTE IS A GLOBAL NOTE WITHIN THE MEANING OF THE INDENTURE HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF A DEPOSITORY OR A NOMINEE OF A DEPOSITORY OR A SUCCESSOR DEPOSITORY.  THIS NOTE IS NOT EXCHANGEABLE FOR NOTES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE

B-1

DEPOSITORY OR ITS NOMINEE EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE, AND NO TRANSFER OF THIS NOTE (OTHER THAN A TRANSFER OF THIS NOTE AS A WHOLE BY THE DEPOSITORY TO A NOMINEE OF THE DEPOSITORY OR BY A NOMINEE OF THE DEPOSITORY TO THE DEPOSITORY OR ANOTHER NOMINEE OF THE DEPOSITORY) MAY BE REGISTERED EXCEPT IN THE LIMITED CIRCUMSTANCES DESCRIBED IN THE INDENTURE.

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), TO THE ISSUER OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

TRANSFERS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS IN WHOLE, BUT NOT IN PART, TO NOMINEES OF CEDE & CO. OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL NOTE SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN SECTION 2.16 OF THE INDENTURE.

Each Temporary Regulation S Global Note shall also bear the following legend:

“THIS GLOBAL NOTE IS A TEMPORARY GLOBAL NOTE FOR PURPOSES OF REGULATION S UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED (THE “SECURITIES ACT”).  NEITHER THIS TEMPORARY GLOBAL NOTE NOR ANY INTEREST HEREIN MAY BE OFFERED, SOLD OR DELIVERED, EXCEPT AS PERMITTED UNDER THE INDENTURE REFERRED TO BELOW.

“NO BENEFICIAL OWNERS OF THIS TEMPORARY GLOBAL NOTE SHALL BE ENTITLED TO RECEIVE PAYMENT OF PRINCIPAL OR INTEREST HEREON UNLESS THE REQUIRED CERTIFICATIONS HAVE BEEN DELIVERED PURSUANT TO THE TERMS OF THE INDENTURE.”

B-2

EXHIBIT C

Form of Certificate To Be
Delivered in Connection with
Transfers to Non-QIB Institutional Accredited Investors

[                  ], [    ]

The Bank of New York Mellon Trust Company, N.A.
700 S. Flower Street, Suite 500
Los Angeles, California 90017
T: (213) 630 6489
F: (213) 630 6298

Attention:  Corporate Trust Department

Ladies and Gentlemen:

In connection with our proposed purchase of 8.00% Senior Notes due 2018 (the “Notes”) of CPI INTERNATIONAL ACQUISITION, INC. (to be renamed CPI INTERNATIONAL, INC.), a Delaware corporation (the “Issuer”), we confirm that:

1.We understand that any subsequent transfer of the Notes is subject to certain restrictions and conditions set forth in the Indenture relating to the Notes (the “Indenture”) and the undersigned agrees to be bound by, and not to resell, pledge or otherwise transfer the Notes except in compliance with, such restrictions and conditions and the Securities Act of 1933, as amended (the “Securities Act”), and all applicable state securities laws.

2.We understand that the offer and sale of the Notes have not been registered under the Securities Act, and that the Notes may not be offered, sold, pledged or otherwise transferred except as permitted in the following sentence.  We agree, on our own behalf and on behalf of any accounts for which we are acting as hereinafter stated, that if we should sell, offer, pledge or otherwise transfer any Notes, we will do so only (i) to the Issuer or any of its subsidiaries, (ii) inside the United States in a transaction meeting the requirements of Rule 144A under the Securities Act to a person who we reasonably believe to be a “qualified institutional buyer” (as defined in Rule 144A under the Securities Act), (iii) inside the United States to an institutional “accredited investor” (as defined below) that is purchasing at least $250,000 of Notes for its own account or for the account of an institutional accredited investor and who, prior to such transfer, furnishes (or has furnished on its behalf by a U.S. broker-dealer) to the Trustee (as defined in the Indenture) a signed letter containing certain representations and agreements relating to the restrictions on transfer of the Notes (the form of which letter can be obtained from the Trustee), (iv) outside the United States to a person that is not a U.S. person (as defined in Rule 902 under the Securities Act) in accordance with Regulation S promulgated under the Securities Act, (v) pursuant to the exemption from registration provided by Rule 144 under the Securities Act (if available) or (vi) pursuant to an effective registration statement under the Securities Act, and we further agree to provide to any person purchasing any of the Notes from us a notice advising such purchaser that resales of the Notes are restricted as stated herein.

3.We are not acquiring the Notes for or on behalf of, and will not transfer the Notes to, any employee benefit plan subject to Title I of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), any plan, individual retirement accounts or other arrangements subject to Section 4975 of the Internal Revenue Code of 1986, as amended (the “Code”), or provisions under any federal, state, local, or non-U.S. or other laws or regulations that are similar to such provisions of ERISA of the Code or any entity whose underlying assets are considered to include “plan assets” of such plans, accounts or arrangements, except as permitted in the sections entitled “Notice to investors” and “Certain ERISA considerations” of the Offering Memorandum.

C-1

4.We understand that, on any proposed resale of any Notes, we will be required to furnish to the Trustee and the Issuer such certification, legal opinions and other information as the Trustee and the Issuer may reasonably require to confirm that the proposed sale complies with the foregoing restrictions.  We further understand that the Notes purchased by us will bear a legend to the foregoing effect.

5.We are an institutional “accredited investor” (as defined in Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) and have such knowledge and experience in financial and business matters as to be capable of evaluating the merits and risks of our investment in the Notes, and we and any accounts for which we are acting are each able to bear the economic risk of our or their investment, as the case may be.

6.We are acquiring the Notes purchased by us for our account or for one or more accounts (each of which is an institutional “accredited investor”) as to each of which we exercise sole investment discretion.

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You, as Trustee, the Issuer, counsel for the Issuer and others are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceeding or official inquiry with respect to the matters covered hereby.

Very truly yours,
[Name of Transferee]
By:
	Name:
	Title:

C-3

EXHIBIT D

Form of Certificate To Be Delivered
in Connection with Transfers
     Pursuant to Regulation S     

[                ], [    ]

The Bank of New York Mellon Trust Company, N.A.
700 S. Flower Street, Suite 500
Los Angeles, California 90017
T: (213) 630 6489
F: (213) 630 6298

Attention:  Corporate Trust Department

Re:CPI International Acquisition, Inc. (the “Issuer”)
   8.00% Senior Notes due 2018 (the “Notes”)   

Ladies and Gentlemen:

In connection with our proposed sale of $[   ] aggregate principal amount of the Notes, we confirm that such sale has been effected pursuant to and in accordance with Regulation S under the U.S. Securities Act of 1933, as amended (the “Securities Act”), and, accordingly, we represent that:

(1)           the offer of the Notes was not made to a person in the United States;

(2)           either (a) at the time the buy offer was originated, the transferee was outside the United States or we and any person acting on our behalf reasonably believed that the transferee was outside the United States, or (b) the transaction was executed in, on or through the facilities of a designated offshore securities market and neither we nor any person acting on our behalf knows that the transaction has been prearranged with a buyer in the United States;

(3)           no directed selling efforts have been made in the United States in contravention of the requirements of Rule 903(b) or Rule 904(b) of Regulation S, as applicable;

(4)           the transaction is not part of a plan or scheme to evade the registration requirements of the Securities Act; and

(5)           we have advised the transferee of the transfer restrictions applicable to the Notes.

You, as Trustee, the Issuer, counsel for the Issuer and others are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby.  Terms used in this certificate have the meanings set forth in Regulation S.

Very truly yours,

[Name of Transferor]

D-1

By:

Authorized Signatory

D-2

EXHIBIT E

FORM OF CERTIFICATE TO BE DELIVERED IN CONNECTION WITH
TRANSFERS OF TEMPORARY REGULATION S GLOBAL NOTE

                           ,          

The Bank of New York Mellon Trust Company, N.A.
700 S. Flower Street, Suite 500
Los Angeles, California 90017
T: (213) 630 6489
F: (213) 630 6298

Attention:  Corporate Trust Department

Re:CPI International Acquisition, Inc. (the “Issuer”)
   8.00% Senior Notes due 2018 (the “Notes”)   

Dear Sirs:

This letter relates to U.S. $                     principal amount of Notes represented by a certificate (the “Legended Certificate”) which bears a legend outlining restrictions upon transfer of such Legended Certificate.  Pursuant to Section 2.16(c) of the Indenture (the “Indenture”) dated as of February 11, 2011 relating to the Notes, we hereby certify that we are (or we will hold such securities on behalf of) a person outside the United States (or to an Initial Purchaser (as defined in the Indenture)) to whom the Notes could be transferred in accordance with Rule 904 of Regulation S promulgated under the U.S. Securities Act of 1933, as amended.

You, as Trustee, the Issuer, counsel for the Issuer and others are entitled to rely upon this letter and are irrevocably authorized to produce this letter or a copy hereof to any interested party in any administrative or legal proceedings or official inquiry with respect to the matters covered hereby.  Terms used in this letter have the meanings set forth in Regulation S.

Very truly yours,

[Name of Holder]

By:

Authorized Signatory

E-1

EX-4.2

Exhibit 4.2

SUPPLEMENTAL INDENTURE

SUPPLEMENTAL INDENTURE (this “Supplemental Indenture”), dated as of February 11, 2011, by and among CPI International Acquisition, Inc. (to be renamed CPI International, Inc.), a Delaware corporation (the “Issuer”), CPI International Holding Corp., a Delaware Corporation, (the “Parent”), the indirect, wholly-owned subsidiaries of the Issuer listed as guarantors on the signature pages hereto, (such subsidiaries collectively with the Parent, the “Guarantors”), The Bank of New York Mellon Trust Company, N.A., a national banking association organized and existing under the laws of the United States of America, as trustee under the indenture referred to below (the “Trustee”), and the other Guarantors (as defined in the Indenture referenced below).

W I T N E S S E T H

WHEREAS, the Issuer and the Parent have heretofore executed and delivered to the Trustee an indenture (the “Indenture”), dated as of February 11, 2011, providing for the issuance of an aggregate principal amount of $215,000,000 of 8.00% Senior Notes due 2018 (the “Notes”);

WHEREAS, the Issuer is party to an Agreement and Plan of Merger, dated as of November 24, 2010 (the “Merger Agreement”), with CPI International, Inc., a Delaware corporation (“CPII”), and Catalyst Acquisition, Inc., a Delaware corporation (the “Merger Sub”), pursuant to which Merger Sub has been merged with and into CPII (the “Merger”);

WHEREAS, upon the consummation of the Merger, the Guarantors (other than the Parent) have become indirect, wholly owned subsidiaries of the Issuer; and

WHEREAS, the Purchase Agreement dated as of February 3, 2011 among the Issuer, Parent, Catalyst Acquisition, Inc., UBS Securities LLC and KKR Capital Markets LLC requires that the Guarantors execute and deliver to the Trustee this Supplemental Indenture pursuant to which the Guarantors shall unconditionally guarantee all of the Issuer’s obligations under the Notes and the Indenture.

NOW THEREFORE, in consideration of the foregoing and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Guarantors and the Trustee mutually covenant and agree for the equal and ratable benefit of the Holders of the Notes as follows:

1.Capitalized Terms.  Capitalized terms used herein without definition shall have the meanings assigned to them in the Indenture.

2.Agreement to Guarantee.  The Guarantors hereby, jointly and severally with all other Guarantors, unconditionally guarantee the Issuer’s obligations under the Notes on the terms and subject to the conditions set forth in Article 11 of the Indenture and agree to be bound by all other applicable provisions of the Indenture.  From and after the date of this Supplemental Indenture, each Guarantor shall be a “Guarantor” for all purposes of the Indenture.

3.Effectiveness.  This Supplemental Indenture shall be effective upon execution by the parties hereto.

4.Governing Law.  This Supplemental Indenture and the guarantee provided in Section 2 hereof will be governed by and construed in accordance with the laws of the State of New York.

5.Counterparts.  The parties may sign any number of copies or counterparts of this Supplemental Indenture.  Each signed copy shall be an original, but all of them together shall represent the same agreement.

6.Effect of Headings.  The headings of the Sections of this Supplemental Indenture have been inserted for convenience only, are not to be considered a part hereof and shall in no way modify or restrict any of the terms or provisions hereof.

7.Trustee Disclaimer.  The Trustee makes no representation as to the validity or sufficiency of this Supplemental Indenture other than as to the validity of its execution and delivery by the Trustee. The recitals and statements herein are deemed to be those of the Issuer and not of the Trustee.

2

IN WITNESS WHEREOF, the parties hereto have caused this Supplemental Indenture to be duly executed as of the date first above written.

CPI INTERNATIONAL ACQUISITION, INC. (to be renamed CPI INTERNATIONAL, INC.),
as Issuer
By:	/s/ Joel A. Littman
	Name:	Joel A. Littman
	Title:	Chief Financial Officer, Treasurer and Secretary
CPI INTERNATIONAL HOLDING CORP.,
as Guarantor
By:	/s/ Joel A. Littman
	Name:	Joel A. Littman
	Title:	Chief Financial Officer, Treasurer and Secretary
COMMUNICATIONS & POWER INDUSTRIES LLC, as Guarantor
By:	/s/ Joel A. Littman
	Name:	Joel A. Littman
	Title:	Chief Financial Officer, Treasurer and Secretary
CPI ECONCO DIVISION, as Guarantor
By:	/s/ Joel A. Littman
	Name:	Joel A. Littman
	Title:	Secretary and Treasurer
CPI SUBSIDIARY HOLDINGS LLC, as Guarantor
By:	Communications & Power Industries, LLC, its sole member
By:	/s/ Joel A. Littman
	Name:	Joel A. Littman
	Title:	Chief Financial Officer, Treasurer and Secretary

3

CPI MALIBU DIVISION, as Guarantor
By:	/s/ Joel A. Littman
	Name:	Joel A. Littman
	Title:	Secretary and Chief Financial Officer
COMMUNICATIONS & POWER INDUSTRIES INTERNATIONAL INC.,
as Guarantor
By:	/s/ Joel A. Littman
	Name:	Joel A. Littman
	Title:	Secretary
COMMUNICATIONS & POWER INDUSTRIES ASIA INC., as Guarantor
By:	/s/ Joel A. Littman
	Name:	Joel A. Littman
	Title:	Secretary and Treasurer
THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.,
as Trustee
By:	/s/ Alex Briffett
	Name:	John A. (Alex) Briffett
	Title:	Authorized Signatory

4

EX-4.3

Exhibit 4.3

REGISTRATION RIGHTS AGREEMENT

Dated as of February 11, 2011

By and Among

CPI INTERNATIONAL ACQUISITION, INC.,

the GUARANTORS named herein

and

UBS SECURITIES LLC

and

KKR CAPITAL MARKETS LLC

as Initial Purchasers

8.00% Senior Notes due 2018

TABLE OF CONTENTS

			Page
Section 1.		Definitions	1
Section 2.		Exchange Offer	5
Section 3.		Shelf Registration	8
Section 4.		Additional Interest	9
Section 5.		Registration Procedures	10
Section 6.		Registration Expenses	17
Section 7.		Indemnification	18
Section 8.		Rules 144 and 144A	21
Section 9.		Underwritten Registrations	21
Section 10.		Miscellaneous	21
	(a)	No Inconsistent Agreements	21
	(b)	Adjustments Affecting Registrable Notes	22
	(c)	Amendments and Waivers	22
	(d)	Notices	22
	(e)	Guarantors	23
	(f)	Successors and Assigns	23
	(g)	Counterparts	23
	(h)	Headings	24
	(i)	Governing Law	24
	(j)	Severability	24
	(k)	Securities Held by the Issuers or Their Affiliates	24
	(l)	Third-Party Beneficiaries	24
	(m)	Entire Agreement	24
SIGNATURES			S-1

REGISTRATION RIGHTS AGREEMENT

This Registration Rights Agreement (this “Agreement”) is dated as of February 11, 2011, by and among CPI INTERNATIONAL ACQUISITION, INC., a Delaware corporation (the “Company”), and each of the Guarantors (as defined herein) (the Company and the Guarantors are referred to collectively herein as the “Issuers”), on the one hand, and UBS SECURITIES LLC (the “Representative”) and KKR CAPITAL MARKETS LLC (together with the Representative, the “Initial Purchasers”), on the other hand.

This Agreement is entered into in connection with the Purchase Agreement, dated as of February 3, 2011, by and among the Issuers and the Initial Purchasers (the “Purchase Agreement”), relating to the offering of $215,000,000 aggregate principal amount of 8.00% Senior Notes due 2018 of the Company (including the guarantees thereof by the Guarantors, the “Notes”).  The execution and delivery of this Agreement is a condition to the Initial Purchasers’ obligation to purchase the Notes under the Purchase Agreement.  On the date hereof, the Company will acquire CPI International, Inc., a Delaware corporation (“CPII”) through its indirect wholly owned subsidiary Catalyst Acquisition, Inc., a Delaware corporation (“MergerSub”), which will merge with and into CPII (the “Merger”), after which the obligations of MergerSub under this Agreement, will become obligations of CPII.  The representations, warranties and agreements of CPII and its subsidiaries that are Guarantors shall not become effective until consummation of the Merger and execution by the CPII and its subsidiaries that are Guarantors of a joinder agreement to this Agreement (the “Joinder Agreement”), at which time such representations, warranties and agreements shall become effective as of the date hereof pursuant to the terms of the Joinder Agreement and CPII and each of its subsidiaries that are Guarantors shall, without any further action by any person, become a party to this Agreement.

The parties hereby agree as follows:

Section 1.        Definitions

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

“action” shall have the meaning set forth in Section 7(c) hereof.

“Additional Interest” shall have the meaning set forth in Section 4(a) hereof.

“Additional Interest Payment Date” shall have the meaning set forth in Section 4(b) hereof.

“Advice” shall have the meaning set forth in Section 5 hereof.

“Agreement” shall have the meaning set forth in the first introductory paragraph hereto.

“Applicable Period” shall have the meaning set forth in Section 2(b) hereof.

“Board of Directors” shall have the meaning set forth in Section 5 hereof.

“Business Day” shall mean a day that is not a Legal Holiday.

“Company” shall have the meaning set forth in the introductory paragraph hereto and shall also include the Company’s permitted successors and assigns.

“Commission” shall mean the Securities and Exchange Commission or any successor agency or other government body performing functions currently performed by the Securities and Exchange Commission.

“CPI” shall have the meaning set forth in the second introductory paragraph hereto.

“day” shall mean a calendar day.

“Delay Period” shall have the meaning set forth in Section 5 hereof.

“Effectiveness Period” shall have the meaning set forth in Section 3(b) hereof.

“Exchange Act” shall mean the Securities Exchange Act of 1934, as amended, and the rules and regulations of the Commission promulgated thereunder.

“Exchange Notes” shall have the meaning set forth in Section 2(a) hereof.

“Exchange Offer” shall have the meaning set forth in Section 2(a) hereof.

“Exchange Offer Registration Statement” shall have the meaning set forth in Section 2(a) hereof.

“FINRA” shall mean the Financial Industry Regulatory Authority.

“Guarantors” means each subsidiary of the Company listed on the signature page to this Agreement and each Person who executes and delivers the Joinder Agreement or a counterpart of this Agreement after the date hereof pursuant to Section 10(e) hereof.

“Holder” shall mean any holder of a Registrable Note or Registrable Notes.

“Indenture” shall mean the Indenture, dated as of February 11, 2011, by and among the Issuers and The Bank of New York Mellon, as trustee, pursuant to which the Notes are being issued, as amended or supplemented from time to time in accordance with the terms thereof.

“Initial Purchasers” shall have the meaning set forth in the first introductory paragraph hereof.

“Inspectors” shall have the meaning set forth in Section 5(n) hereof.

“Issue Date” shall mean February 11, 2011, the date of original issuance of the Notes.

“Issuers” shall have the meaning set forth in the first introductory paragraph hereto.

2

“Joinder Agreement” shall have the meaning set forth in the second introductory paragraph hereto.

“Legal Holiday” shall mean a Saturday, a Sunday or a day on which banking institutions in New York, New York are required by law, regulation or executive order to remain closed.

“Losses” shall have the meaning set forth in Section 7(a) hereof.

“Merger” shall have the meaning set forth in the second introductory paragraph hereto.

“MergerSub” shall have the meaning set forth in the second introductory paragraph hereto.

“Notes” shall have the meaning set forth in the second introductory paragraph hereto.

“Participant” shall have the meaning set forth in Section 7(a) hereof.

“Participating Broker-Dealer” shall have the meaning set forth in Section 2(b) hereof.

“Person” shall mean an individual, corporation, partnership, joint venture association, joint stock company, trust, limited liability company, government or any agency or political subdivision thereof or any other entity.

“Private Exchange” shall have the meaning set forth in Section 2(b) hereof.

“Private Exchange Notes” shall have the meaning set forth in Section 2(b) hereof.

“Prospectus” shall mean the prospectus included in any Registration Statement (including, without limitation, any prospectus subject to completion and a prospectus that includes any information previously omitted from a prospectus filed as part of an effective registration statement in reliance upon Rule 430A promulgated under the Securities Act), as amended or supplemented by any prospectus supplement, and all other amendments and supplements to the Prospectus, including post-effective amendments, and all material incorporated by reference or deemed to be incorporated by reference in such Prospectus.

“Purchase Agreement” shall have the meaning set forth in the second introductory paragraph hereof.

“Records” shall have the meaning set forth in Section 5(m) hereof.

“Registrable Notes” shall mean each Note upon its original issuance and at all times subsequent thereto, each Exchange Note as to which Section 2(c)(iv) hereof is applicable upon original issuance and at all times subsequent thereto and each Private Exchange Note upon original issuance thereof and at all times subsequent thereto, in each case until (i) a Registration Statement (other than, with respect to any Exchange Note as to which Section 2(c)(iv) hereof is applicable, the Exchange Offer Registration Statement) covering such Note, Exchange Note or Private Exchange Note has been

3

declared effective by the Commission and such Note, Exchange Note or such Private Exchange Note, as the case may be, has been disposed of in accordance with such effective Registration Statement, (ii) such Note has been exchanged pursuant to the Exchange Offer for an Exchange Note or Exchange Notes that may be resold without restriction under state and federal securities laws other than due solely to the status of such Holders as an affiliate of any Issuer within the meaning of the Securities Act, or (iii) such Note, Exchange Note or Private Exchange Note, as the case may be, ceases to be outstanding for purposes of the Indenture.

“Registration Default” shall have the meaning set forth in Section 4(a) hereof.

“Registration Statement” shall mean any appropriate registration statement of the Issuers covering any of the Registrable Notes filed with the Commission under the Securities Act, and all amendments and supplements to any such Registration Statement, including post-effective amendments, in each case including the Prospectus contained therein, all exhibits thereto and all material incorporated by reference therein.

“Requesting Participating Broker-Dealer” shall have the meaning set forth in Section 2(b) hereof.

“Rule 144” shall mean Rule 144 promulgated under the Securities Act, as such Rule may be amended from time to time, or any similar rule (other than Rule 144A) or regulation hereafter adopted by the Commission providing for offers and sales of securities made in compliance therewith resulting in offers and sales by subsequent holders that are not affiliates of an issuer of such securities being free of the registration and prospectus delivery requirements of the Securities Act.

“Rule 144A” shall mean Rule 144A promulgated under the Securities Act, as such Rule may be amended from time to time, or any similar rule (other than Rule 144) or regulation hereafter adopted by the Commission.

“Rule 415” shall mean Rule 415 promulgated under the Securities Act, as such Rule may be amended from time to time, or any similar rule or regulation hereafter adopted by the Commission.

“Securities Act” shall mean the Securities Act of 1933, as amended, and the rules and regulations of the Commission promulgated thereunder.

“Shelf Filing Event” shall have the meaning set forth in Section 2(c) hereof.

“Shelf Registration” shall have the meaning set forth in Section 3(a) hereof.

“TIA” shall mean the Trust Indenture Act of 1939, as amended.

“Trustee” shall mean the trustee under the Indenture and the trustee (if different than the trustee under the Indenture) under any indenture governing the Exchange Notes and Private Exchange Notes.

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“underwritten registration” or “underwritten offering” shall mean a registration in which securities of the Issuers are sold to an underwriter for reoffering to the public.

Section 2.        Exchange Offer

(a)           Unless the Exchange Offer would violate applicable law or interpretation of the staff of the Commission, the Issuers shall (i) file a Registration Statement (the “Exchange Offer Registration Statement”) with the Commission on an appropriate registration form with respect to a registered offer (the “Exchange Offer”) to exchange any and all of the Registrable Notes for a like aggregate principal amount of notes (including the guarantees with respect thereto, the “Exchange Notes”) that are identical in all material respects to the Notes (except that the Exchange Notes shall not contain restrictive legends, terms with respect to transfer restrictions or Additional Interest upon a Registration Default), (ii) use their commercially reasonable efforts to cause the Exchange Offer Registration Statement to be declared effective under the Securities Act and (iii) use their commercially reasonable efforts to consummate the Exchange Offer within 270 days after the Issue Date.  Upon the Exchange Offer Registration Statement being declared effective by the Commission, the Issuers will offer the Exchange Notes in exchange for surrender of the Notes.  The Issuers shall keep the Exchange Offer open for not less than 20 days (or longer if required by applicable law) after the date notice of the Exchange Offer is mailed to registered Holders.

Each Holder that participates in the Exchange Offer will be required to represent to the Issuers in writing that (i) any Exchange Notes to be received by it will be acquired in the ordinary course of its business, (ii) it has no arrangement or understanding with any Person to participate in the distribution (within the meaning of the Securities Act) of the Exchange Notes in violation of the provisions of the Securities Act, (iii) it is not an affiliate of the Company or any Guarantor as defined by Rule 405 of the Securities Act, or if it is an affiliate, it will comply with the registration and prospectus delivery requirements of the Securities Act to the extent applicable, (iv) if such Holder is not a broker-dealer, it is not engaged in, and does not intend to engage in, a distribution of Exchange Notes and (v) if such Holder is a broker-dealer that will receive Exchange Notes for its own account in exchange for Notes that were acquired as a result of market-making or other trading activities, it will deliver a prospectus in connection with any resale of such Exchange Notes.

(b)           The Issuers and the Initial Purchasers acknowledge that the staff of the Commission has taken the position that any broker-dealer that elects to exchange Notes that were acquired by such broker-dealer for its own account as a result of market-making or other trading activities for Exchange Notes in the Exchange Offer (a “Participating Broker-Dealer”) may be deemed to be an “underwriter” within the meaning of the Securities Act and must deliver a prospectus meeting the requirements of the Securities Act in connection with any resale of such Exchange Notes (other than a resale of an unsold allotment resulting from the original offering of the Notes).

The Issuers and the Initial Purchasers also acknowledge that the staff of the Commission has taken the position that if the Prospectus contained in the Exchange Offer Registration Statement includes a plan of distribution containing a statement to the above effect and the means by which Participating Broker-Dealers may resell the Exchange Notes, without naming the Participating Broker-Dealers or specifying the amount of Exchange Notes owned by them, such Prospectus may be delivered by Participating Broker-Dealers to satisfy their prospectus delivery obligations under the Securi-

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ties Act in connection with resales of Exchange Notes for their own accounts, so long as the Prospectus otherwise meets the requirements of the Securities Act.

In light of the foregoing, if requested by a Participating Broker-Dealer (a “Requesting Participating Broker-Dealer”), the Issuers agree to use their commercially reasonable efforts to keep the Exchange Offer Registration Statement continuously effective for a period necessary to comply with applicable law in connection with such resales but in no event more than 180 days after the date on which the Exchange Registration Statement is declared effective, or such longer period if extended pursuant to any Delay Period in accordance with the last paragraph of Section 5 hereof (such period, the “Applicable Period”), or such earlier date as each Requesting Participating Broker-Dealer shall have notified the Company in writing that such Requesting Participating Broker-Dealer has resold all Exchange Notes acquired by it in the Exchange Offer.  The Issuers shall include a plan of distribution in such Exchange Offer Registration Statement that meets the requirements set forth in the preceding paragraph.

If, prior to consummation of the Exchange Offer, any Initial Purchaser or any other Holder holds any Notes acquired by it that have, or that are reasonably likely to be determined to have, the status of an unsold allotment in an initial distribution, or if any Holder is not entitled to participate in the Exchange Offer, the Issuers upon the request of any Initial Purchaser or any such Holder, as the case may be, shall simultaneously with the delivery of the Exchange Notes in the Exchange Offer, issue and deliver to the Initial Purchasers or any such Holder, as the case may be, in exchange (the “Private Exchange”) for such Notes held by the Initial Purchasers or any such Holder a like principal amount of notes (the “Private Exchange Notes”) of the Issuers that are identical in all material respects to the Exchange Notes except that the Private Exchange Notes may be subject to restrictions on transfer and bear a legend to such effect.  The Private Exchange Notes shall be issued pursuant to the same indenture as the Exchange Notes and bear the same CUSIP number as the Exchange Notes (if permitted by the CUSIP Service Bureau).

Upon consummation of the Exchange Offer in accordance with this Section 2, the Issuers shall have no further registration obligations other than the Issuers’ continuing registration obligations with respect to (i) Private Exchange Notes, (ii) Exchange Notes held by Participating Broker-Dealers and (iii) Notes or Exchange Notes as to which clause (c)(iv) of this Section 2 applies.

In connection with the Exchange Offer, the Issuers shall:

(1)           mail or cause to be mailed to each registered Holder entitled to participate in the Exchange Offer a copy of the Prospectus forming part of the Exchange Offer Registration Statement, together with an appropriate letter of transmittal and related documents;

(2)           utilize the services of a depositary for the Exchange Offer;

(3)           permit Holders to withdraw tendered Notes at any time prior to the close of business, New York time, on the last Business Day on which the Exchange Offer shall remain open; and

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(4)           otherwise comply in all material respects with all applicable laws, rules and regulations.

As soon as practicable after the close of the Exchange Offer and the Private Exchange, if any, the Issuers shall:

(1)           accept for exchange all Notes validly tendered and not validly withdrawn by the Holders pursuant to the Exchange Offer and the Private Exchange, if any;

(2)           deliver or cause to be delivered to the Trustee for cancellation all Registrable Notes so accepted for exchange; and

(3)           cause the Trustee to authenticate and deliver promptly to each such Holder of Notes, Exchange Notes or Private Exchange Notes, as the case may be, equal in principal amount to the Registrable Notes of such Holder so accepted for exchange.

The Exchange Offer and the Private Exchange shall not be subject to any conditions, other than that (i) the Exchange Offer or Private Exchange, as the case may be or the making of any exchange by a Holder, does not violate applicable law, rule or regulation or any applicable interpretation of the staff of the Commission, (ii) the procedural requirements for tendering Registrable Securities set forth in the applicable registration statement, letter of transmittal or similar applicable documents, (iii) no action or proceeding shall have been instituted or threatened in any court or by any governmental agency which might materially impair the ability of the Issuers to proceed with the Exchange Offer or the Private Exchange, and no material adverse development shall have occurred in any existing action or proceeding with respect to the Issuers and (iv) all governmental approvals shall have been obtained, which approvals the Company deems necessary for the consummation of the Exchange Offer or Private Exchange.

The Exchange Notes and the Private Exchange Notes shall be issued under (i) the Indenture or (ii) an indenture identical in all material respects to the Indenture (in either case, with such changes as are necessary to comply with any requirements of the Commission to effect or maintain the qualification thereof under the TIA) and which, in either case, has been qualified under the TIA and shall provide that (a) the Exchange Notes shall not be subject to the transfer restrictions set forth in the Indenture and (b) the Private Exchange Notes shall be subject to the transfer restrictions set forth in the Indenture.  The Indenture or such indenture shall provide that the Exchange Notes, the Private Exchange Notes and the Notes shall vote and consent together on all matters as one class and that none of the Exchange Notes, the Private Exchange Notes or the Notes will have the right to vote or consent as a separate class on any matter.

(c)           In the event that (i) any changes in law or the applicable interpretations of the staff of the Commission do not permit the Issuers to effect the Exchange Offer, (ii) for any reason the Exchange Offer is not consummated within 270 days of the Issue Date, (iii) any Holder notifies the Company prior to the 20th day following consummation of the Exchange Offer that it is prohibited by law or the applicable interpretations of the staff of the Commission from participating in the Exchange Offer, (iv) in the case of any Holder who participates in the Exchange Offer, such Holder does not receive Exchange Notes on the date of the exchange that may be sold without restriction under state and

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federal securities laws (other than due solely to the status of such Holder as an affiliate of any Issuer within the meaning of the Securities Act) or (v) any Initial Purchaser so requests with respect to Notes or Private Exchange Notes that have, or that are reasonably likely to be determined to have, the status of unsold allotments in an initial distribution (each such event referred to in clauses (i) through (v) of this sentence, a “Shelf Filing Event”), then the Issuers shall file a Shelf Registration pursuant to Section 3 hereof.

Section 3.        Shelf Registration

If at any time a Shelf Filing Event shall occur, then:

(a)           Shelf Registration.  The Issuers shall file with the Commission a Registration Statement for an offering to be made on a continuous basis pursuant to Rule 415 covering all of the Registrable Notes not exchanged in the Exchange Offer, Private Exchange Notes and Exchange Notes as to which Section 2(c)(iv) is applicable (the “Shelf Registration”).  The Shelf Registration shall be on Form S-1 or another appropriate form permitting registration of such Registrable Notes for resale by Holders in the manner or manners designated by them (including, without limitation, one or more underwritten offerings).  The Issuers shall not permit any securities other than the Registrable Notes to be included in the Shelf Registration.

(b)           The Issuers shall use their commercially reasonable efforts (x) to cause the Shelf Registration to be declared effective under the Securities Act on or prior to the later of (A) the 270th day after the Issue Date and (B) the 120th day after the occurrence of the applicable Shelf Filing Event and (y) to keep the Shelf Registration continuously effective under the Securities Act for the period ending on the date which is one year from the date such Shelf Registration Statement is declared effective under the Securities Act, subject to extension pursuant to the penultimate paragraph of Section 5 hereof, or such shorter period ending when all Registrable Notes covered by the Shelf Registration have been sold in the manner set forth and as contemplated in the Shelf Registration(the “Effectiveness Period”); provided, however, that (i) the Effectiveness Period in respect of the Shelf Registration shall be extended to the extent required to permit dealers to comply with the applicable prospectus delivery requirements of Rule 174 under the Securities Act and as otherwise provided herein and (ii) the Company may suspend the effectiveness of the Shelf Registration by written notice to the registered Holders solely (A) as a result of the filing of a post-effective amendment to the Shelf Registration to incorporate annual audited financial information with respect to the Company where such post-effective amendment is not yet effective and needs to be declared effective to permit Holders to use the related Prospectus or (B) to the extent and for so long as permitted by the penultimate paragraph of Section 5.

(c)           Supplements and Amendments.  The Issuers agree to supplement or make amendments to the Shelf Registration as and when required by the rules, regulations or instructions applicable to the registration form used for such Shelf Registration or by the Securities Act or rules and regulations thereunder for shelf registration, or if reasonably requested by the Holders of a majority in aggregate principal amount of the Registrable Notes covered by such Registration Statement or by the Initial Purchasers.

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Section 4.        Additional Interest

(a)           The Issuers and the Initial Purchasers agree that the Holders will suffer damages if the Issuers fail to fulfill their obligations under Section 2 or Section 3 hereof and that it would not be feasible to ascertain the extent of such damages with precision.  Accordingly, the Issuers agree that if:

(i)      the Exchange Offer is not consummated on or prior to the 270th day following the Issue Date, or, if that day is not a Business Day, the next day that is a Business Day; or

(ii)     the Shelf Registration is required to be filed but is not declared effective within the time period specified in Section 3(b)(x), or is declared effective by such date but thereafter ceases to be effective or usable (unless the Shelf Registration ceases to be effective or usable as specifically permitted by Section 3(b) and the penultimate paragraph of Section 5 hereof),

(each such event referred to in clauses (i) and (ii) a “Registration Default”), additional interest in the form of additional cash interest (“Additional Interest”) will accrue on the affected Registrable Notes.  The rate of Additional Interest will be 0.25% per annum for the first 90-day period immediately following the occurrence of a Registration Default, increasing by an additional 0.25% per annum with respect to each subsequent 90-day period up to a maximum amount of Additional Interest of 1.00% per annum, from and including the date on which any such Registration Default shall occur to, but excluding, the earlier of (1) the date on which all Registration Defaults have been cured or (2) the date on which such Registrable Note ceases to be a Registrable Note or otherwise become freely transferable by Holders other than affiliates of the Issuers without further registration under the Securities Act.  If, after the cure of all Registration Defaults then in effect, there is a subsequent Registration Default, the rate of Additional Interest for such subsequent Registration Default shall initially be 0.25% regardless of the rate in effect with respect to any prior Registration Default at the time of cure of such Registration Default and shall increase in the manner and be subject to the maximum Additional Interest rate contained in the preceding sentence.

Notwithstanding the foregoing, (1) the amount of Additional Interest payable shall not increase because more than one Registration Default has occurred and is pending and (2) a Holder of Registrable Notes that is not entitled to the benefits of the Shelf Registration (e.g., such Holder has not elected to include information) shall not be entitled to Additional Interest with respect to a Registration Default that pertains to the Shelf Registration.

(b)           So long as Notes remain outstanding, the Company shall notify the Trustee within five Business Days after each and every date on which an event occurs in respect of which Additional Interest is required to be paid.  Any amounts of Additional Interest due pursuant to clauses (a)(i) or (a)(ii) of this Section 4 will be payable on each date on which interest is required to be paid pursuant to the Indenture (each a “Additional Interest Payment Date”), commencing with the first such date occurring after any such Additional Interest commences to accrue, to Holders to whom regular interest is payable on such Additional Interest Payment Date with respect to Notes that are Registrable Notes.  The amount of Additional Interest for each Registrable Note will be determined by multiplying the applicable rate of Additional Interest by the aggregate principal amount of such Registrable Note

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outstanding on the Additional Interest Payment Date following such Registration Default in the case of the first such payment of Additional Interest with respect to a Registration Default (and thereafter at the next succeeding Additional Interest Payment Date until the cure of such Registration Default), and multiplying the product of the foregoing by a fraction, the numerator of which is the number of days such Additional Interest rate was applicable during such period (determined on the basis of a 360-day year comprised of twelve 30-day months and, in the case of a partial month, the actual number of days elapsed), and the denominator of which is 360.

Section 5.        Registration Procedures

In connection with the filing of any Registration Statement pursuant to Section 2 or 3 hereof, the Issuers shall effect such registrations to permit the sale of the securities covered thereby in accordance with the intended method or methods of disposition thereof, and pursuant thereto and in connection with any Registration Statement filed by the Issuers hereunder, the Issuers shall:

(a)           Prepare and file with the Commission the Registration Statement or Registration Statements prescribed by Section 2 or 3 hereof, and use their commercially reasonable efforts to cause each such Registration Statement to become effective and remain effective as provided herein; provided, however, that, if (1) such filing is pursuant to Section 3 hereof, or (2) a Prospectus contained in the Exchange Offer Registration Statement filed pursuant to Section 2 hereof is required to be delivered under the Securities Act by any Participating Broker-Dealer who seeks to sell Exchange Notes during the Applicable Period relating thereto, before filing any Registration Statement or Prospectus or any amendments or supplements thereto, the Issuers shall furnish to and afford the Holders of the Registrable Notes covered by such Registration Statement or each such Participating Broker-Dealer, as the case may be, their counsel (if requested by any such person) and the managing underwriters, if any, a reasonable opportunity to review copies of all such documents (including copies of any documents to be incorporated by reference therein and all exhibits thereto) proposed to be filed (in each case at least five Business Days prior to such filing).

(b)           Prepare and file with the Commission such amendments and post-effective amendments to each Shelf Registration or Exchange Offer Registration Statement, as the case may be, as may be necessary to keep such Registration Statement continuously effective for the Effectiveness Period or the Applicable Period, as the case may be; cause the related Prospectus to be supplemented by any Prospectus supplement required by applicable law, and as so supplemented to be filed pursuant to Rule 424 (or any similar provisions then in force) promulgated under the Securities Act; and comply with the applicable provisions of the Securities Act and the Exchange Act with respect to the disposition of all securities covered by such Registration Statement as so amended or in such Prospectus as so supplemented and with respect to the subsequent resale of any securities being sold by a Participating Broker-Dealer covered by any such Prospectus, in each case, in accordance with the intended methods of distribution set forth in such Registration Statement or Prospectus, as so amended or supplemented.

(c)           If (1) a Shelf Registration is filed pursuant to Section 3 hereof, or (2) a Prospectus contained in the Exchange Offer Registration Statement filed pursuant to Section 2

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hereof is required to be delivered under the Securities Act by any Participating Broker-Dealer who seeks to sell Exchange Notes during the Applicable Period relating thereto from whom the Company has received written notice that such Broker-Dealer will be a Participating Broker-Dealer in the applicable Exchange Offer, notify the selling Holders of Registrable Notes, or each such Participating Broker-Dealer, as the case may be, their counsel (if such counsel is known to the Issuers) and the managing underwriters, if any, as promptly as possible, and, if requested by any such Person, confirm such notice in writing, (i) when a Prospectus or any Prospectus supplement or post-effective amendment has been filed, and, with respect to a Registration Statement or any post-effective amendment, when the same has become effective under the Securities Act (including in such notice a written statement that any Holder may, upon request, obtain, at the sole expense of the Issuers, one conformed copy of such Registration Statement or post-effective amendment including financial statements and schedules, documents incorporated or deemed to be incorporated by reference and exhibits), (ii) of the issuance by the Commission of any stop order suspending the effectiveness of a Registration Statement or of any order preventing or suspending the use of any preliminary prospectus or the initiation of any proceedings for that purpose, (iii) if at any time when a Prospectus is required by the Securities Act to be delivered in connection with sales of the Registrable Notes or resales of Exchange Notes by Participating Broker-Dealers the representations and warranties of the Issuers contained in any agreement (including any underwriting agreement) contemplated by Section 5(l) hereof cease to be true and correct in all material respects, (iv) of the receipt by any of the Issuers of any notification with respect to the suspension of the qualification or exemption from qualification of a Registration Statement or any of the Registrable Notes or the Exchange Notes for offer or sale in any jurisdiction, or the initiation or threatening of any proceeding for such purpose, (v) of the happening of any event, the existence of any condition or any information becoming known to any Issuer that makes any statement made in such Registration Statement or related Prospectus or any document incorporated or deemed to be incorporated therein by reference untrue in any material respect or that requires the making of any changes in or amendments or supplements to such Registration Statement, Prospectus or documents so that, in the case of the Registration Statement, it will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein not misleading, and that in the case of the Prospectus, it will not contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading, and (vi) of the Company’s determination that a post-effective amendment to a Registration Statement would be appropriate.

(d)           If (1) a Shelf Registration is filed pursuant to Section 3 hereof, or (2) a Prospectus contained in the Exchange Offer Registration Statement filed pursuant to Section 2 hereof is required to be delivered under the Securities Act by any Participating Broker-Dealer who seeks to sell Exchange Notes during the Applicable Period, use their commercially reasonable efforts to prevent the issuance of any order suspending the effectiveness of a Registration Statement or of any order preventing or suspending the use of a Prospectus or suspending the qualification (or exemption from qualification) of any of the Registrable Notes or the Exchange Notes, as the case may be, for sale in any jurisdiction, and, if any such order is issued, to use their commercially reasonable efforts to obtain the withdrawal of any such order at the earliest practicable moment.

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(e)           If (1) a Shelf Registration is filed pursuant to Section 3 hereof or (2) a Prospectus contained in the Exchange Offer Registration Statement filed pursuant to Section 2 hereof is required to be delivered under the Securities Act by any Participating Broker-Dealer who seeks to sell Exchange Notes during the Applicable Period and if reasonably requested by the managing underwriter (if any), the Holders of a majority in aggregate principal amount of the Registrable Notes covered by such Registration Statement or any Participating Broker-Dealer, as the case may be, (i) promptly incorporate in such Registration Statement or Prospectus a prospectus supplement or post-effective amendment such information as the managing underwriter (if any), such Holders or any Participating Broker-Dealer, as the case may be (based upon advice of counsel), determine is reasonably required to be included therein and (ii) make all required filings of such prospectus supplement or such post-effective amendment as soon as practicable after the Company has received notification of the matters to be incorporated in such prospectus supplement or post-effective amendment; provided, however, that the Issuers shall not be required to take any action hereunder that would, in the reasonable opinion of counsel to the Issuers, violate applicable laws.

(f)            If (1) a Shelf Registration is filed pursuant to Section 3 hereof or (2) a Prospectus contained in the Exchange Offer Registration Statement filed pursuant to Section 2 hereof is required to be delivered under the Securities Act by any Participating Broker-Dealer who seeks to sell Exchange Notes during the Applicable Period, furnish to each selling Holder of Registrable Notes or each such Participating Broker-Dealer, as the case may be, who so requests, their counsel (if requested by any such person) and each managing underwriter, if any, at the sole expense of the Issuers, one conformed copy of the Registration Statement or Registration Statements and each post-effective amendment thereto, including financial statements and schedules, and, if requested, all documents incorporated or deemed to be incorporated therein by reference and all exhibits.

(g)           If (1) a Shelf Registration is filed pursuant to Section 3 hereof, or (2) a Prospectus contained in the Exchange Offer Registration Statement filed pursuant to Section 2 hereof is required to be delivered under the Securities Act by any Participating Broker-Dealer who seeks to sell Exchange Notes during the Applicable Period, deliver to each selling Holder of Registrable Notes or each such Participating Broker-Dealer, as the case may be, their respective counsel (if requested) and the managing underwriter, if any, at the sole expense of the Issuers, as many copies of the Prospectus or Prospectuses (including each form of preliminary prospectus) and each amendment or supplement thereto and any documents incorporated by reference therein as such Persons may reasonably request; and, subject to the last paragraph of this Section 5, the Issuers hereby consent to the use, in the manner described in such Prospectus or any amendment or supplement thereto and in accordance with applicable law, of such Prospectus and each amendment or supplement thereto by each of the selling Holders of Registrable Notes or each such Participating Broker-Dealer, as the case may be, and the underwriters or agents, if any, and dealers (if any), in connection with the offering and sale of the Registrable Notes covered by, or the sale by Participating Broker-Dealers of the Exchange Notes pursuant to, such Prospectus and any amendment or supplement thereto.

(h)           Prior to any public offering of Registrable Notes or Exchange Notes or any delivery of a Prospectus contained in the Exchange Offer Registration Statement by any

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Participating Broker-Dealer who seeks to sell Exchange Notes during the Applicable Period, use their commercially reasonable efforts to register or qualify, and to cooperate with the selling Holders of Registrable Notes or each such Participating Broker-Dealer, as the case may be, the managing underwriter, if any, and their respective counsel in connection with the registration or qualification (or exemption from such registration or qualification) of such Registrable Notes or Exchange Notes, as the case may be, for offer and sale under the securities or “blue sky” laws of such jurisdictions within the United States as any selling Holder, Participating Broker-Dealer, or the managing underwriter reasonably request; provided, however, that where Exchange Notes or Registrable Notes are offered other than through an underwritten offering, the Issuers agree to cause the Issuers’ counsel to perform “blue sky” investigations and file registrations and qualifications required to be filed pursuant to this Section 5(h); keep each such registration or qualification (or exemption therefrom) effective during the period such Registration Statement is required to be kept effective and do any and all other acts or things reasonably necessary or advisable to enable the disposition in such jurisdictions of such Exchange Notes or Registrable Notes covered by the applicable Registration Statement; provided, however, that no Issuer shall be required to (A) qualify generally to do business in any jurisdiction where it is not then so qualified, (B) take any action that would subject it to general service of process in any such jurisdiction where it is not then so subject or (C) subject itself to taxation in any such jurisdiction where it is not then so subject.

(i)            If a Shelf Registration is filed pursuant to Section 3 hereof, cooperate with the selling Holders of Registrable Notes and the managing underwriter, if any, to facilitate the timely preparation and delivery of certificates representing Registrable Notes to be sold, which certificates shall not bear any restrictive legends and shall be in a form eligible for deposit with The Depository Trust Company; and enable such Registrable Notes to be in such denominations and registered in such names as the managing underwriter, if any, or selling Holders may request at least two Business Days prior to any sale of such Registrable Notes.

(j)            If (1) a Shelf Registration is filed pursuant to Section 3 hereof, or (2) a Prospectus contained in the Exchange Offer Registration Statement filed pursuant to Section 2 hereof is required to be delivered under the Securities Act by any Participating Broker-Dealer who seeks to sell Exchange Notes during the Applicable Period, upon the occurrence of any event contemplated by Section 5(c)(v) or 5(c)(vi) hereof, as promptly as practicable prepare and (subject to Section 5(a) and the penultimate paragraph of this Section 5) file with the Commission, at the sole expense of the Issuers, a supplement or post-effective amendment to the Registration Statement or a supplement to the related Prospectus or any document incorporated or deemed to be incorporated therein by reference, or file any other required document so that, as thereafter delivered to the purchasers of the Registrable Notes being sold thereunder or to the purchasers of the Exchange Notes to whom such Prospectus will be delivered by a Participating Broker-Dealer, any such Prospectus will not contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in the light of the circumstances under which they were made, not misleading.

(k)           Prior to the effective date of the first Registration Statement relating to the Registrable Notes, (i) if requested by the Trustee, provide the Trustee with certificates for the

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Registrable Notes in a form eligible for deposit with The Depository Trust Company and (ii) provide a CUSIP number for the Registrable Notes.

(l)            In connection with any underwritten offering of Registrable Notes pursuant to a Shelf Registration, enter into an underwriting agreement as is customary in underwritten offerings of debt securities similar to the Notes and take all such other actions as are reasonably requested by the managing underwriter in order to expedite or facilitate the registration or the disposition of such Registrable Notes and, (i) make such representations and warranties to the underwriter or underwriters, and covenants with, the underwriters with respect to the business of the Issuers and their subsidiaries (including any acquired business, properties or entity, if applicable), and the Registration Statement, Prospectus and documents, if any, incorporated or deemed to be incorporated by reference therein, in each case, as are customarily made by issuers to underwriters in underwritten offerings of debt securities similar to the Notes, and confirm the same in writing if and when requested; (ii) use their commercially reasonable efforts to obtain the written opinions of counsel to the Issuers, and written updated thereof in form, scope and substance reasonably satisfactory to the managing underwriter, addressed to the underwriters covering the matters customarily covered in opinions requested in underwritten offerings and such other matters as may be reasonably requested by the managing underwriter; (iii) use their commercially reasonable efforts to obtain “cold comfort” letters and updates thereof in form, scope and substance reasonably satisfactory to the managing underwriter from the independent certified public accountants of the Company (and, if necessary, any other independent certified public accountants of any subsidiary of the Company or of any business acquired by the Company for which financial statements and financial data are, or are required to be, included or incorporated by reference in the Registration Statement), addressed to each of the underwriters, such letters to be in customary form and covering matters of the type customarily covered in “cold comfort” letters in connection with underwritten offerings; and (iv) if an underwriting agreement is entered into, the same shall contain indemnification provisions and procedures no less favorable than those set forth in Section 7 hereof (or such other provisions and procedures acceptable to the managing underwriter) with respect to all parties to be indemnified pursuant to said Section; provided that the Issuers shall not be required to provide indemnification to any underwriter with respect to information relating to such underwriter furnished in writing to the Company by or on behalf of such underwriter expressly for inclusion in such Registration Statement.  The above shall be done at each closing under such underwriting agreement, or as and to the extent required thereunder.

(m)          If (1) a Shelf Registration is filed pursuant to Section 3 hereof or (2) a Prospectus contained in the Exchange Offer Registration Statement filed pursuant to Section 2 hereof is required to be delivered under the Securities Act by any Participating Broker-Dealer who seeks to sell Exchange Notes during the Applicable Period, make available for inspection by any selling Holder of such Registrable Notes being sold or each such Participating Broker-Dealer, as the case may be, any underwriter participating in any such disposition of Registrable Notes, if any, and any attorney, accountant or other agent retained by any such selling Holder or each such Participating Broker-Dealer, as the case may be, or underwriter (collectively, the “Inspectors”), at the offices where normally kept, during reasonable business hours, all financial and other records, corporate documents and instruments of the Company and its subsidiaries (collectively, the “Records”) as shall be reasonably necessary to enable them to

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exercise any applicable due diligence responsibilities, and cause the officers, directors and employees of the Company and its subsidiaries to supply all information reasonably requested by any such Inspector in connection with such Registration Statement and Prospectus.  Each Inspector shall agree in writing that it will keep the Records confidential and that it will not disclose, or use in connection with any market transactions in violation of any applicable securities laws, any Records that the Company determines, in good faith, to be confidential and that it notifies the Inspectors in writing are confidential unless (i) the disclosure of such Records is necessary to avoid or correct a misstatement or omission in such Registration Statement or Prospectus, (ii) the release of such Records is ordered pursuant to a subpoena or other order from a court of competent jurisdiction, (iii) disclosure of such information is necessary or advisable in the opinion of counsel for an Inspector in connection with any action, claim, suit or proceeding, directly or indirectly, involving or potentially involving such Inspector and arising out of, based upon, relating to, or involving this Agreement or the Purchase Agreement, or any transactions contemplated hereby or thereby or arising hereunder or thereunder, or (iv) the information in such Records has been made generally available to the public; provided, however, that (i) each Inspector shall agree to use commercially reasonable efforts to provide notice to the Company of the potential disclosure of any information by such Inspector pursuant to clause (i), (ii) or (iii) of this sentence to permit the Issuers to obtain a protective order (or waive the provisions of this paragraph (n)) and (ii) each such Inspector shall take such actions as are reasonably necessary to protect the confidentiality of such information (if practicable) to the extent such action is otherwise not inconsistent with, an impairment of or in derogation of the rights and interests of the Holder or any Inspector.

(n)           Provide an indenture trustee for the Registrable Notes or the Exchange Notes, as the case may be, and cause the Indenture or the trust indenture provided for in Section 2(b) hereof to be qualified under the TIA not later than the effective date of the Exchange Offer or the first Registration Statement relating to the Registrable Notes; and in connection therewith, cooperate with the trustee under any such indenture and the Holders of the Registrable Notes or Exchange Notes, as applicable, to effect such changes to such indenture as may be required for such indenture to be so qualified in accordance with the terms of the TIA; and execute, and use their commercially reasonable efforts to cause such trustee to execute, all documents as may be required to effect such changes, and all other forms and documents required to be filed with the Commission to enable such indenture to be so qualified in a timely manner.

(o)           Comply in all material respects with all applicable rules and regulations of the Commission and make generally available to the Company’s securityholders earnings statements satisfying the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder (or any similar rule promulgated under the Securities Act) no later than 45 days after the end of any 12-month period (or 90 days after the end of any 12-month period if such period is a fiscal year) (i) commencing at the end of any fiscal quarter in which Registrable Notes or Exchange Notes are sold to underwriters in a firm commitment or best efforts underwritten offering and (ii) if not sold to underwriters in such an offering, commencing on the first day of the first fiscal quarter of the Company after the effective date of a Registration Statement, which statements shall cover said 12-month periods consistent with the requirements of Rule 158.

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(p)           If the Exchange Offer or a Private Exchange is to be consummated, upon delivery of the Registrable Notes by Holders to the Company (or to such other Person as directed by the Company) in exchange for the Exchange Notes or the Private Exchange Notes, as the case may be, mark, or cause to be marked, on such Registrable Notes that such Registrable Notes are being cancelled in exchange for the Exchange Notes or the Private Exchange Notes, as the case may be; provided that in no event shall such Registrable Notes be marked as paid or otherwise satisfied.

(q)           Cooperate with each seller of Registrable Notes covered by any Registration Statement and each underwriter, if any, participating in the disposition of such Registrable Notes and their respective counsel in connection with any filings required to be made with FINRA.

(r)            Use their commercially reasonable efforts to take all other steps reasonably necessary to effect the registration of the Exchange Notes and/or Registrable Notes covered by a Registration Statement contemplated hereby.

The Company may require each seller of Registrable Notes or Exchange Notes as to which any registration is being effected to furnish to the Company such information regarding such seller and the distribution of such Registrable Notes or Exchange Notes as the Company may, from time to time, reasonably request.  The Company may exclude from such registration the Registrable Notes of any seller so long as such seller fails to furnish such information within a reasonable time after receiving such request and in the event of such an exclusion, the Issuers shall have no further obligation under this Agreement (including, without limitation, the obligations under Section 4) with respect to such seller or any subsequent Holder of such Registrable Notes.  Each seller as to which any Shelf Registration is being effected agrees to furnish promptly to the Company all information required to be disclosed in order to make any information previously furnished to the Company by such seller not materially misleading.

If any such Registration Statement refers to any Holder by name or otherwise as the holder of any securities of the Company or the Guarantors, then such Holder shall have the right to require (i) the insertion therein of language, in form and substance reasonably satisfactory to such Holder, to the effect that the holding by such Holder of such securities is not to be construed as a recommendation by such Holder of the investment quality of the securities covered thereby and that such holding does not imply that such Holder will assist in meeting any future financial requirements of the Company or the Guarantors, or (ii) in the event that such reference to such Holder by name or otherwise is not required by the Securities Act or any similar federal statute then in force, the deletion of the reference to such Holder in any amendment or supplement to the applicable Registration Statement filed or prepared subsequent to the time that such reference ceases to be required.

Each Holder of Registrable Notes and each Participating Broker-Dealer agrees by acquisition of such Registrable Notes or Exchange Notes that, upon the Company providing notice to such Holder or Participating Broker-Dealer, as the case may be, (x) of the happening of any event of the kind described in Section 5(c)(ii), 5(c)(iii), 5(c)(iv), or 5(c)(v) hereof, or (y) that the Board of Directors of the Company (the “Board of Directors”) has resolved that the Company has a bona fide business purpose for doing so, then, upon providing such notice (which shall refer to the penultimate

16

paragraph of this Section 5), the Issuers may delay the filing or the effectiveness of the Exchange Offer Registration Statement or the Shelf Registration (if not then filed or effective, as applicable) and shall not be required to maintain the effectiveness thereof or amend or supplement the Exchange Offer Registration Statement or the Shelf Registration, in all cases, for a period (a “Delay Period”) expiring upon the earlier to occur of (i) in the case of the immediately preceding clause (x), such Holder’s or Participating Broker-Dealer’s receipt of the copies of the supplemented or amended Prospectus contemplated by Section 5(k) hereof or until it is advised in writing (the “Advice”) by the Company that the use of the applicable Prospectus may be resumed, and has received copies of any amendments or supplements thereto or (ii) in the case of the immediately preceding clause (y), the date which is the earlier of (A) the date on which such business purpose ceases to interfere with the Issuers’ obligations to file or maintain the effectiveness of any such Registration Statement pursuant to this Agreement or (B) 60 days after the Company notifies the Holders of such good faith determination.  For the avoidance of doubt, a Delay Period of 60 days may be followed immediately by another Delay Period of 60 days subject to the next sentence.  There shall not be more than 120 days of Delay Periods during any 12-month period, during which no Additional Interest shall be payable.  The maximum length of the Applicable Period set forth in Section 2(b) shall be extended by a number of days equal to the number of days during any Delay Period.  If one or more Delay Periods exceed 120 days in any 12 month period, the Additional Interest will begin to accrue on the 121st day until such Registration Default shall be cured.

Each Holder or Participating Broker-Dealer, by its acceptance of any Registrable Note, agrees that during any Delay Period, each Holder or Participating Broker-Dealer will discontinue disposition of such Notes or Exchange Notes covered by such Registration Statement or Prospectus or Exchange Notes to be sold by such Holder or Participating Broker-Dealer, as the case may be.

Section 6.        Registration Expenses

All fees and expenses incident to the performance of or compliance with this Agreement by the Issuers (other than any underwriting discounts or commissions) shall be borne by the Issuers, whether or not the Exchange Offer Registration Statement or the Shelf Registration is filed or becomes effective or the Exchange Offer is consummated, including, without limitation, (i) all registration and filing fees (including, without limitation, fees and expenses of compliance with state securities or “blue sky” laws (including, without limitation, reasonable fees and disbursements of counsel in connection with “blue sky” qualifications of the Registrable Notes or Exchange Notes and determination of the eligibility of the Registrable Notes or Exchange Notes for investment under the laws of such jurisdictions (x) where the holders of Registrable Notes are located, in the case of an Exchange Offer, or (y) as provided in Section 5(h) hereof, in the case of a Shelf Registration or in the case of Exchange Notes to be sold by a Participating Broker-Dealer during the Applicable Period)), (ii) printing expenses, including, without limitation, expenses of printing certificates for Registrable Notes or Exchange Notes in a form eligible for deposit with The Depository Trust Company and of printing prospectuses if the printing of prospectuses is requested by the managing underwriter, if any, or by the Holders of a majority in aggregate principal amount of the Registrable Notes included in any Registration Statement or in respect of Exchange Notes to be sold by any Participating Broker-Dealer during the Applicable Period, as the case may be, (iii) messenger, telephone and delivery expenses, (iv) fees and disbursements of counsel for the Issuers and the reasonable fees and disbursements of one special counsel for all of the sellers of Registrable Notes (exclusive of any counsel retained

17

pursuant to Section 7 hereof) selected by the Holders of a majority in aggregate principal amount of Notes, Exchange Notes and Private Exchange Notes being registered and reasonably satisfactory to the Issuers, (v) fees and disbursements of all independent certified public accountants of the Issuers (including, without limitation, the expenses of any “cold comfort” letters required by or incident to such performance), (vi) Securities Act liability insurance, if the Issuers desire such insurance, (vii) fees and expenses of all other Persons retained by any of the Issuers, (viii) internal expenses of the Issuers (including, without limitation, all salaries and expenses of officers and employees of the Company performing legal or accounting duties), (ix) the expense of any annual audit, (x) any required fees and expenses incurred in connection with any filing required to be made with FINRA and (xi) the expenses relating to printing, word processing and distributing all Registration Statements, underwriting agreements, indentures and any other documents necessary in order to comply with this Agreement.  Notwithstanding the foregoing or anything to the contrary, each Holder shall pay all underwriting discounts and commissions of any underwriters with respect to any Registrable Notes sold by or on behalf of it.

Section 7.        Indemnification

(a)           The Issuers, jointly and severally, agree to indemnify and hold harmless each Holder of Registrable Notes and each Participating Broker-Dealer selling Exchange Notes during the Applicable Period, each Person, if any, who controls any such Person within the meaning of Section 15 of the Securities Act or Section 20(a) of the Exchange Act, the agents, employees, officers and directors of each Holder and each such Participating Broker-Dealer and the agents, employees, officers and directors of any such controlling Person (each, a “Participant”) from and against any and all losses, liabilities, claims, damages and expenses whatsoever (including, but not limited to, reasonable attorneys’ fees and any and all reasonable expenses whatsoever actually incurred in investigating, preparing or defending against any litigation, commenced or threatened, or any claim whatsoever, and any and all reasonable amounts paid in settlement of any claim or litigation) (collectively, “Losses”) to which they or any of them may become subject under the Securities Act, the Exchange Act or otherwise insofar as such Losses (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in any Registration Statement (or any amendment thereto) or Prospectus (as amended or supplemented if the Company shall have furnished any amendments or supplements thereto) or any preliminary prospectus, arising out of or based upon any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein, in the case of the Prospectus, in the light of the circumstances under which they were made, not misleading, provided that (i) the foregoing indemnity shall not be available to any Participant insofar as such Losses arising out of or are based upon any untrue statement or omission or alleged untrue statement or omission made in reliance upon and in conformity with information relating to such Participant’s related Holder furnished to the Company in writing by or on behalf of such Participant’s related Holder expressly for use therein, and (ii) the foregoing indemnity with respect to any preliminary prospectus shall not inure to the benefit of any Participant’s related Holder from whom the Person asserting such Losses purchased Registrable Notes if (x) it is established in the related proceeding that such Participant’s related Holder failed to send or give a copy of the Prospectus (as amended or supplemented if such amendment or supplement was furnished to such Participant’s related Holder prior to the written confirmation of such sale) to such Person with or prior to the written confirmation of such sale, if required by applicable law, and (y) the untrue statement or omission or alleged untrue statement or omission was completely corrected in the

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Prospectus (as amended or supplemented if amended or supplemented as aforesaid) and such Prospectus does not contain any other untrue statement or omission or alleged untrue statement or omission that was the subject matter of the related proceeding.  This indemnity agreement will be in addition to any liability that the Issuers may otherwise have, including, but not limited to, liability under this Agreement.

(b)           Each Participant agrees, severally and not jointly, to indemnify and hold harmless each Issuer, each Person, if any, who controls any Issuer within the meaning of Section 15 of the Securities Act or Section 20(a) of the Exchange Act, and each of their respective agents, employees, officers and directors from and against any Losses to which they or any of them may become subject under the Securities Act, the Exchange Act or otherwise insofar as such Losses (or actions in respect thereof) arise out of or are based upon any untrue statement or alleged untrue statement of a material fact contained in any Registration Statement (or any amendment thereto) or Prospectus (as amended or supplemented if the Company shall have furnished any amendments or supplements thereto) or any preliminary prospectus, or arising out of or based upon any omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein, in the case of the Prospectus, in the light of the circumstances under which they were made, not misleading, in each case to the extent, but only to the extent, that any such Loss arises out of or is based upon any untrue statement or alleged untrue statement or omission or alleged omission made in reliance upon and in conformity with information relating to such Participant furnished in writing to the Company by or on behalf of such Participant expressly for use therein.  This indemnity agreement will be in addition to any liability that such Participant may otherwise have, including but not limited to liability under this Agreement.

(c)           Promptly after receipt by an indemnified party under subsection 7(a) or 7(b) above of notice of the commencement of any action, suit or proceeding (collectively, an “action”), such indemnified party shall, if a claim in respect thereof is to be made against the indemnifying party under such subsection, notify each party against whom indemnification is to be sought in writing of the commencement of such action (but the failure so to notify an indemnifying party shall not relieve such indemnifying party from any liability that it may have under this Section 7 except to the extent that it has been prejudiced in any material respect by such failure).  In case any such action is brought against any indemnified party, and it notifies an indemnifying party of the commencement of such action, the indemnifying party will be entitled to participate in such action, and to the extent it may elect by written notice delivered to the indemnified party promptly after receiving the aforesaid notice from such indemnified party, to assume the defense of such action with counsel reasonably satisfactory to such indemnified party.  Notwithstanding the foregoing, the indemnified party or parties shall have the right to employ its or their own counsel in any such action, but the reasonable fees and expenses of such counsel shall be at the expense of such indemnified party or parties unless (i) the employment of such counsel shall have been authorized in writing by the indemnifying parties in connection with the defense of such action, (ii) the indemnifying parties shall not have employed counsel to take charge of the defense of such action within a reasonable time after notice of commencement of the action, or (iii) the named parties to such action (including any impleaded parties) include such indemnified party and the indemnifying party or parties (or such indemnifying parties have assumed the defense of such action), and such indemnified party or parties shall have reasonably concluded, after consultation with counsel, that there may be defenses available to it or them that are different from or additional to those available to one or all of the indemnifying parties (in which case the indemnifying

19

parties shall not have the right to direct the defense of such action on behalf of the indemnified party or parties), in any of which events such reasonable fees and expenses of counsel shall be borne by the indemnifying parties.  In no event shall the indemnifying party be liable for the reasonable fees and expenses of more than one counsel (together with appropriate local counsel) at any time for all indemnified parties in connection with any one action or separate but substantially similar or related actions arising in the same jurisdiction out of the same general allegations or circumstances.  Any such separate firm for the Participants shall be designated in writing by Participants who sold a majority in interest of Registrable Notes sold by all such Participants and shall be reasonably acceptable to the Company.  An indemnifying party shall not be liable for any settlement of any claim or action effected without its written consent, which consent may not be unreasonably withheld.  No indemnifying party shall, without the prior written consent of the indemnified party, effect any settlement of any pending or threatened proceeding in respect of which any indemnified party is or could have been a party and indemnity could have been sought hereunder by such indemnified party, unless such settlement (x) includes an unconditional release of such indemnified party from all liability on claims that are the subject matter of such proceeding and (y) does not include a statement as to or an admission of fault, culpability or a failure to act by or on behalf of any indemnified party.

(d)           In order to provide for contribution in circumstances in which the indemnification provided for in this Section 7 is for any reason held to be unavailable from the indemnifying party for any Losses referred to therein, or is insufficient to hold harmless a party indemnified under this Section 7 for any Losses referred to therein, each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of such aggregate Losses (i) in such proportion as is appropriate to reflect the relative benefits received by each indemnifying party, on the one hand, and each indemnified party, on the other hand, from the sale of the Notes to the Initial Purchasers or the resale of the Registrable Notes by such Holder, as applicable, or (ii) if such allocation is not permitted by applicable law, in such proportion as is appropriate to reflect not only the relative benefits referred to in clause (i) above but also the relative fault of each indemnified party, on the one hand, and each indemnifying party, on the other hand, in connection with the statements or omissions that resulted in such Losses, as well as any other relevant equitable considerations.  The relative benefits received by the Issuers, on the one hand, and each Participant, on the other hand, shall be deemed to be in the same proportion as (x) the total proceeds from the sale of the Notes to the Initial Purchasers (net of discounts and commissions but before deducting expenses) received by the Issuers are to (y) the total net profit received by such Participant in connection with the sale of the Registrable Notes.  The relative fault of the parties shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the Issuers or such Participant and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission or alleged statement or omission.

(e)           The parties agree that it would not be just and equitable if contribution pursuant to this Section 7 were determined by pro rata allocation or by any other method of allocation that does not take into account the equitable considerations referred to above.  Notwithstanding the provisions of this Section 7, (i) in no case shall any Participant be required to contribute any amount in excess of the amount by which the net profit received by such Participant in connection with the sale of the Registrable Notes exceeds the amount of any damages that such Participant has otherwise been required to pay by reason of any untrue or alleged untrue statement or omission or alleged omission

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and (ii) no person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.  Any party entitled to contribution will, promptly after receipt of notice of commencement of any action against such party in respect of which a claim for contribution may be made against another party or parties under this Section 7, notify in writing such party or parties from whom contribution may be sought, but the omission to so notify such party or parties shall not relieve the party or parties from whom contribution may be sought from any obligation it or they may have under this Section 7 or otherwise, except to the extent that it has been prejudiced in any material respect by such failure; provided, however, that no additional notice shall be required with respect to any action for which notice has been given under this Section 7 for purposes of indemnification.  Anything in this section to the contrary notwithstanding, no party shall be liable for contribution with respect to any action or claim settled without its written consent, provided, however, that such written consent was not unreasonably withheld.

Section 8.        Rules 144 and 144A

The Issuers covenant that they will file the reports required, if any, to be filed by them under the Securities Act and the Exchange Act and the rules and regulations adopted by the Commission thereunder in a timely manner in accordance with the requirements of the Securities Act and the Exchange Act and, if at any time the Issuers are not required to file such reports, they will, upon the request of any Holder or beneficial owner of Registrable Notes, make available such information necessary to permit sales pursuant to Rule 144A under the Securities Act.

Section 9.        Underwritten Registrations

If any of the Registrable Notes covered by any Shelf Registration are to be sold in an underwritten offering, the investment banker or investment bankers and manager or managers that will manage the offering will be selected by the Holders of a majority in aggregate principal amount of such Registrable Notes included in such offering and shall be reasonably acceptable to the Company.

No Holder of Registrable Notes may participate in any underwritten registration hereunder if such Holder does not (a) agree to sell such Holder’s Registrable Notes on the basis provided in any underwriting arrangements approved by the Persons entitled hereunder to approve such arrangements and (b) complete and execute all questionnaires, powers of attorney, indemnities, underwriting agreements and other documents required under the terms of such underwriting arrangements.

Section 10.      Miscellaneous

(a)           No Inconsistent Agreements.  The Issuers have not, as of the date hereof, and shall not, after the date of this Agreement, enter into any agreement with respect to any of their securities that is inconsistent with the rights granted to the Holders of Registrable Notes in this Agreement or otherwise conflicts with the provisions hereof.  The rights granted to the Holders hereunder do not conflict with and are not inconsistent with, in any material respect, the rights granted to the holders of any of the Issuers’ other issued and outstanding securities under any such agreements.

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(b)           Adjustments Affecting Registrable Notes.  The Issuers shall not, directly or indirectly, take any action with respect to the Registrable Notes as a class that would materially and adversely affect the ability of the Holders of Registrable Notes to include such Registrable Notes in a registration undertaken pursuant to this Agreement.

(c)           Amendments and Waivers.  The provisions of this Agreement may not be amended, modified or supplemented, and waivers or consents to departures from the provisions hereof may not be given except pursuant to a written agreement duly signed and delivered by (I) the Company (on behalf of all Issuers) and (II)(A) the Holders of not less than a majority in aggregate principal amount of the then outstanding Registrable Notes and (B) in circumstances that would adversely affect the Participating Broker-Dealers, the Participating Broker-Dealers holding not less than a majority in aggregate principal amount of the Exchange Notes held by all Participating Broker-Dealers; provided, however, that Section 7 and this Section 10(c) may not be amended, modified or supplemented except pursuant to a written agreement duly signed and delivered by the Issuers and each Holder and each Participating Broker-Dealer (including any Person who was a Holder or Participating Broker-Dealer of Registrable Notes or Exchange Notes, as the case may be, disposed of pursuant to any Registration Statement) affected by any such amendment, modification, waiver or supplement.  Notwithstanding the foregoing, a waiver or consent to depart from the provisions hereof with respect to a matter that relates exclusively to the rights of Holders of Registrable Notes whose securities are being sold pursuant to a Registration Statement and that does not directly or indirectly affect, impair, limit or compromise the rights of other Holders of Registrable Notes may be given by Holders of at least a majority in aggregate principal amount of the Registrable Notes being sold pursuant to such Registration Statement.

(d)           Notices.  All notices and other communications (including, without limitation, any notices or other communications to the Trustee) provided for or permitted hereunder shall be made in writing by hand-delivery, registered first-class mail, next-day air courier or telecopier:

(i)         if to a Holder of the Registrable Notes or any Participating Broker-Dealer, at the most current address of such Holder or Participating Broker-Dealer, as the case may be, set forth on the records of the registrar under the Indenture.

(ii)        if to any Issuer, to it

	CPI International Acquisition, Inc.
	c/o The Veritas Capital Fund IV, L.P.
	590 Madison Avenue
	New York, NY 10022
	Fax: (212) 688-9411
	Attention: Jeffrey Kelly
with a copies to:
	Skadden, Arps, Slate, Meagher & Flom LLP
	Four Times Square

22

New York, NY 10036

Fax:  (212) 688-9411

Attention:  Jennifer A. Bensch

CPI International LLC

811 Hansen Way

Palo Alto, California 94303

Fax:  (650) 846-3276

Attention:  General Counsel

(iii)    if to the Initial Purchasers, at the address as follows:

c/o UBS Securities LLC
677 Washington Blvd.
Stamford, Connecticut 06901
Fax number:  (203) 719-1075
Attention:  High Yield Syndicate Department

All such notices and communications shall be deemed to have been duly given:  when delivered by hand, if personally delivered; five Business Days after being deposited in the mail, postage prepaid, if mailed; when receipt is acknowledged by the recipient’s telecopier machine, if telecopied; and on the next Business Day, if timely delivered to an air courier guaranteeing overnight delivery.

Copies of all such notices, demands or other communications shall be concurrently delivered by the Person giving the same to the Trustee at the address and in the manner specified in such Indenture.

(e)           Guarantors.  So long as any Registrable Notes remain outstanding, the Issuers shall cause each Person that becomes a guarantor of the Notes under the Indenture that is not a party to the Joinder Agreement to execute and deliver a counterpart to this Agreement which subjects such Person to the provisions of this Agreement as a Guarantor.  Each of the Guarantors agrees to join the Issuers in all of their undertakings hereunder to effect the Exchange Offer for the Exchange Notes and the filing of any Shelf Registration required hereunder.

(f)            Successors and Assigns.  This Agreement shall inure to the benefit of and be binding upon the successors and assigns of each of the parties hereto, the Holders and the Participating Broker-Dealers; provided, however, that this Agreement shall not inure to the benefit of or be binding upon a successor or assign of a Holder unless and to the extent such successor or assign holds Registrable Notes.

(g)           Counterparts.  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.

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(h)           Headings.  The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof.

(i)            Governing Law.  THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, AS APPLIED TO CONTRACTS MADE AND PERFORMED WHOLLY WITHIN THE STATE OF NEW YORK, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW.

(j)            Severability.  If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction to be invalid, illegal, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions set forth herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated, and the parties hereto shall use their best efforts to find and employ an alternative means to achieve the same or substantially the same result as that contemplated by such term, provision, covenant or restriction.  It is hereby stipulated and declared to be the intention of the parties that they would have executed the remaining terms, provisions, covenants and restrictions without including any of such that may be hereafter declared invalid, illegal, void or unenforceable.

(k)           Securities Held by the Issuers or Their Affiliates.  Whenever the consent or approval of Holders of a specified percentage of Registrable Notes is required hereunder, Registrable Notes held by the Issuers or any of their affiliates (as such term is defined in Rule 405 under the Securities Act) shall not be counted in determining whether such consent or approval was given by the Holders of such required percentage.

(l)            Third-Party Beneficiaries.  Holders and beneficial owners of Registrable Notes and Participating Broker-Dealers are intended third-party beneficiaries of this Agreement, and this Agreement may be enforced by such Persons.  No other Person is intended to be, or shall be construed as, a third-party beneficiary of this Agreement.

(m)          Entire Agreement.  This Agreement, together with the Purchase Agreement and the Indenture, is intended by the parties as a final and exclusive statement of the agreement and understanding of the parties hereto in respect of the subject matter contained herein and therein and any and all prior oral or written agreements, representations, or warranties, contracts, understandings, correspondence, conversations and memoranda between the Holders on the one hand and the Issuers on the other, or between or among any agents, representatives, parents, subsidiaries, affiliates, predecessors in interest or successors in interest with respect to the subject matter hereof and thereof are merged herein and replaced hereby.

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the date first written above.

CPI INTERNATIONAL ACQUISITION, INC.
By:	/s/ Robert B. McKeon
	Name:	Robert B. McKeon
	Title:	President
CPI INTERNATIONAL HOLDING CORP.,
as Guarantor
By:	/s/ Robert B. McKeon
	Name:	Robert B. McKeon
	Title:	President
UBS SECURITIES LLC
KKR CAPITAL MARKETS LLC
By:	UBS SECURITIES LLC, as Representative
	of the Initial Purchasers
By:	/s/ Kevin T. Pluff
	Name:	Kevin T. Pluff
	Title:	Director
By:	/s/ Richard S. Kim
	Name:	Richard S. Kim
	Title:	Director

EX-4.4

Exhibit 4.4

JOINDER AGREEMENT

$215,000,000 of 8.00% Senior Notes due 2018

WHEREAS, CPI International Acquisition, Inc., CPI International Holding Corp. and UBS Securities LLC on behalf of the Initial Purchasers (the “Representative”) heretofore executed and delivered a Purchase Agreement, dated February 3, 2011 (the “Purchase Agreement”) and a Registration Rights Agreement, dated February 11, 2011 (the “Registration Rights Agreement”) related to the issuance and sale of the Securities (as defined therein); and

WHEREAS, as a condition to the consummation of the offering of the Securities, and each Guarantor (as defined in the Purchase Agreement), that was originally not a party thereto, has agreed to join in the Purchase Agreement and Registration Rights Agreement as of the effective time of the Merger.

Capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to such terms in the Purchase Agreement.

NOW, THEREFORE, each Guarantor hereby agrees for the benefit of the Initial Purchasers, as follows:

1.             Joinder.  Each of the undersigned hereby acknowledges that it has received and reviewed a copy of the Purchase Agreement, the Registration Rights Agreement and all other documents it deems fit to enter into this Joinder Agreement (the “Joinder Agreement”), and acknowledges and agrees to (i) join and become a party to the Purchase Agreement and Registration Rights Agreement as indicated by its signature below; (ii) be bound by all covenants, agreements, representations, warranties and acknowledgments attributable to a Guarantor in the Purchase Agreement and Registration Rights Agreement as if made by, and with respect to, each signatory hereto; and (iii) perform all obligations and duties required of a Guarantor pursuant to the Purchase Agreement and Registration Rights Agreement.

2.             Representations and Warranties and Agreements.  Each of the undersigned hereby represents and warrants to and agrees with the Initial Purchasers that (i) it has all the requisite corporate, limited liability company or other organizational power and authority to execute, deliver and perform its obligations under this Joinder Agreement, (ii) this Joinder Agreement has been duly authorized, executed and delivered and that the consummation of the transaction contemplated hereby has been duly and validly authorized, (iii) this Joinder Agreement constitutes a valid and legally binding agreement of each of the undersigned and enforceable against each of the undersigned in accordance with its terms, except to the extent as such enforceability may be limited by the Bankruptcy Exceptions and (iv) the representations, warranties and covenants set forth in Section 5 of the Purchase Agreement are true and correct on and as of the Closing Date.

3.             Counterparts.  This Joinder Agreement may be executed in two or more counterparts each one of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument.  Delivery of an executed counterpart of a signature page to this Joinder Agreement by telecopier, facsimile or other electronic transmission (i.e., a “pdf” or “tif”) shall be effective as delivery of a manually executed counterpart thereof.

4.             Amendments.  No amendment, modification or waiver of any provision of this Joinder Agreement, nor any consent or approval to any departure therefrom, shall in any event be effective unless the same shall be in writing and signed by all of the parties thereto.

5.             Headings.  The section headings herein are for the convenience of the parties only and shall not affect the construction or interpretation of this Joinder Agreement.

6.             CONSTRUCTION.  THIS JOINDER AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH STATE WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THEREOF.

[Intentionally Blank]

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IN WITNESS WHEREOF, the undersigned has executed this agreement this 11th day of February, 2011.

COMMUNICATIONS & POWER INDUSTRIES LLC, as Guarantor
By:	/s/ Joel A. Littman
Name:	Joel A. Littman
Title:	Chief Financial Officer, Treasurer and Secretary
CPI ECONCO DIVISION, as Guarantor
By:	/s/ Joel A. Littman
Name:	Joel A. Littman
Title:	Secretary and Treasurer
CPI SUBSIDIARY HOLDINGS LLC, as Guarantor
By:	Communications & Power Industries, LLC, its sole member
By:	/s/ Joel A. Littman
Name:	Joel A. Littman
Title:	Chief Financial Officer, Treasurer and Secretary
CPI MALIBU DIVISION, as Guarantor
By:	/s/ Joel A. Littman
Name:	Joel A. Littman
Title:	Secretary and Chief Financial Officer
COMMUNICATIONS & POWER INDUSTRIES INTERNATIONAL INC.,
as Guarantor

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By:	/s/ Joel A. Littman
Name:	Joel A. Littman
Title:	Secretary
COMMUNICATIONS & POWER INDUSTRIES ASIA INC., as Guarantor
By:	/s/ Joel A. Littman
Name:	Joel A. Littman
Title:	Secretary and Treasurer

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EX-5.1

Exhibit 5.1

April 7, 2011

CPI International, Inc.

811 Hansen Way

Palo Alto, California 94303-1110

Re:	CPI International, Inc. and Guarantors
	Registration Statement on Form S-4

Ladies and Gentlemen:

We have acted as special counsel to CPI International, Inc., a Delaware corporation (the “Issuer”), CPI International Holding Corp., a Delaware corporation (the “Parent Guarantor”), and each of the subsidiary guarantors of the Issuer listed on Schedule I hereto (collectively, the “Subsidiary Guarantors” and, together with the Parent Guarantor, the “Guarantors”), in connection with the public offering of $215,000,000 aggregate principal amount of the Issuer’s 8.00% Senior Notes due 2018 (the “Exchange Notes”).  The Exchange Notes will be issued under the Indenture, dated as of February 11, 2011 (the “Base Indenture”), by and among the Issuer, the Parent Guarantor, and The Bank of New York Mellon Trust Company, N.A., as trustee (the “Trustee”), as supplemented by the First Supplemental Indenture, dated as of February 11, 2011, by and among the Issuer, the Guarantors and the Trustee ( such First Supplemental Indenture, together with the Base Indenture, the “Indenture”). The Indenture provides for the guarantee of the Exchange Notes by the Guarantors to the extent set forth in the Indenture (guarantees by the Guarantors are referred to herein as the “Guarantees”). The Exchange Notes are to be issued pursuant to an exchange offer (the “Exchange Offer”) in exchange for a like principal amount of the 8.00% Senior Notes due 2018 of the Issuer (the “Original Notes”) issued and outstanding under the Indenture, as contemplated by the Registration Rights Agreement, dated as of February 11, 2011 (the “Registration Rights Agreement”), by and among the Issuer, the Parent Guarantor, UBS Securities LLC and KKR Capital Markets LLC, as the initial purchasers of the Original Notes. Each of the Subsidiary Guarantors have entered into a Joinder Agreement, dated as of February 11, 2011 (the “Joinder Agreement”), pursuant to which the Subsidiary Guarantors became a party to the Registration Rights Agreement.

This opinion is being furnished in accordance with the requirements of Item 601(b)(5) of Regulation S-K under the Securities Act of 1933, as amended (the “Act”).

In connection with this opinion, we have examined originals or copies, certified or otherwise identified to our satisfaction, of:

(i)the Registration Statement on Form S-4 relating to the Exchange Notes and the Guarantees to be filed by the Issuer with the Securities and Exchange Commission (the “Commission”) on the date hereof (the “Registration Statement”);

(ii)an executed copy of the Registration Rights Agreement;

(iii)an executed copy of the Joinder Agreement;

(iv)an executed copy of the Indenture;

(v)the Certificate of Incorporation of the Issuer, as certified by the Secretary of State of the State of Delaware, as amended;

(vi)the Bylaws of the Issuer, as amended and in effect as of the date hereof, as certified by Joel A. Littman, Secretary of the Issuer;

(vii)the Certificate of Incorporation or Restated Articles of Incorporation, as applicable, as amended where applicable of each of the Guarantors that is a corporation, as certified by the Secretary of State of the State of Delaware or State of California, as applicable;

(viii)the Certificate of Formation of each of the Guarantors that is a limited liability company, as certified by the Secretary of State of the State of Delaware;

(ix)the Bylaws or Limited Liability Company Agreement, as applicable, as amended where applicable, of each of the Guarantors, as certified by Joel A. Littman, Secretary of each of the Guarantors;

(x)certain resolutions of the Board of Directors, Board of Managers or Managing Member, or committee thereof, as applicable, of the Issuer and each Guarantor, adopted on January 26, 2011, January 27, 2011, February 3, 2011 or February 11, 2011, as applicable, relating to the Exchange Offer, the issuance of the Original Notes and the Exchange Notes, the Indenture, the Guarantees and related matters, as certified by Joel A. Littman, Secretary of the Issuer and each Guarantor; and

(xi)the form of the Exchange Notes, included as an exhibit to the Indenture.

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We have also examined originals or copies, certified or otherwise identified to our satisfaction, of such records of the Issuer and the Guarantors and such agreements, certificates of public officials, certificates of officers or other representatives of the Issuer, the Guarantors and others, and such other documents, certificates and records as we have deemed necessary or appropriate as a basis for the opinions set forth herein.

In our examination, we have assumed the legal capacity of all natural persons, the genuineness of all signatures, the authenticity of all documents submitted to us as originals, the conformity to original documents of all documents submitted to us as certified, conformed or photostatic copies and the authenticity of the originals of such latter documents. In making our examination of executed documents or documents to be executed, we have assumed that the parties thereto, other than the Issuer and the Guarantors, had or will have the power, corporate or other, to enter into and perform all obligations thereunder and have also assumed the due authorization by all requisite action, corporate or other, and execution and delivery by such parties of such documents, and the validity and binding effect thereof on such parties. We have also assumed that the Issuer and each of the Guarantors has been duly organized and is validly existing in good standing under the laws of their respective jurisdiction of organization. As to any facts material to the opinions expressed herein which we have not independently established or verified, we have relied upon statements and representations of officers and other representatives of the Issuer, the Guarantors and others.

Our opinions set forth herein are limited to the General Corporation Law of the State of Delaware, the Limited Liability Company Act of the State of Delaware, the General Corporation Law of the State of California and the laws of the State of New York, which in our experience, are normally applicable to transactions of the type governed or contemplated by the Exchange Offer, the Indenture and the Exchange Notes (including applicable provisions of the Delaware constitution and reported judicial interpretations interpreting Delaware corporate and limited liability company laws) and to the extent that judicial or regulatory orders or decrees or consents, approvals, licenses, authorizations, validations, filings, recordings or registrations with governmental authorities are relevant, to those required under such laws (all of the foregoing being referred to as “Opined on Law”). We do not express any opinion with respect to the law of any jurisdiction other than Opined on Law or as to the effect of any such non-opined on law on the opinions herein stated.

Based upon and subject to the foregoing and the limitations, qualifications, exceptions and assumptions set forth herein, we are of the opinion that when the Registration Statement, as finally amended, has become effective under the Act, the Indenture has been qualified under the Trust Indenture Act of 1939 and the Exchange Notes have been duly executed and authenticated in accordance with the terms of the Indenture and have been delivered upon consummation of the Exchange Offer against receipt of Original Notes surrendered in exchange therefor in accordance with the terms of the Indenture, the Registration Rights Agreement and the Exchange Offer, the Exchange Notes and the Guarantees will constitute valid and binding obligations of the Issuer and each of the Guarantors, respectively, enforceable against the Issuer and each of the Guarantors, respectively, in accordance with their terms, except to the extent that enforcement

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thereof may be limited by (1) bankruptcy, insolvency, reorganization, moratorium, fraudulent conveyance or other similar laws now or hereafter in effect relating to creditors’ rights generally and (2) general principles of equity (regardless of whether enforceability is considered in a proceeding at law or in equity).

We hereby consent to the filing of this opinion with the Commission as an exhibit to the Registration Statement. We also consent to the reference to our firm under the caption “Legal Matters” in the Registration Statement. In giving this consent, we do not thereby admit that we are included in the category of persons whose consent is required under Section 7 of the Act or the rules and regulations of the Commission.

Very truly yours,

/s/ Skadden, Arps, Slate, Meagher & Flom LLP

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SCHEDULE I

Subsidiary Guarantors

·Communications & Power Industries LLC

·CPI Subsidiary Holdings LLC

·Communications & Power Industries International Inc.

·Communications & Power Industries Asia Inc.

·CPI Econco Division

·CPI Malibu Division

Schedule I

EX-10.1

Exhibit 10.1

Execution Version

$180,000,000

CREDIT AGREEMENT

dated as of February 11, 2011,

among

CPI INTERNATIONAL ACQUISITION, INC. (f/k/a CATALYST HOLDINGS, INC.),

as Borrower,

CPI INTERNATIONAL HOLDING CORP. (f/k/a CATALYST HOLDINGS 2, INC.)

and

THE OTHER GUARANTORS PARTY HERETO,

as Guarantors,

THE LENDERS PARTY HERETO,

UBS SECURITIES LLC,

as Sole Arranger and Bookrunner,

KKR CAPITAL MARKETS LLC,

as Syndication Agent,

Bank of the West and GE Capital Financial Inc.,

as Co-Documentation Agents,

and

UBS AG, STAMFORD BRANCH,

as Issuing Bank, Administrative Agent and Collateral Agent,

and

UBS LOAN FINANCE LLC,

as Swingline Lender

CAHILL GORDON & REINDEL LLP
80 Pine Street
New York, NY 10005

TABLE OF CONTENTS

Section		Page
ARTICLE I.
DEFINITIONS
SECTION 1.01	Defined Terms	2
SECTION 1.02	Classification of Loans and Borrowings	48
SECTION 1.03	Terms Generally	48
SECTION 1.04	Certain Calculations	49
SECTION 1.05	Accounting Terms; GAAP	50
SECTION 1.06	Resolution of Drafting Ambiguities	51
ARTICLE II.
THE CREDITS
SECTION 2.01	Commitments	51
SECTION 2.02	Loans	51
SECTION 2.03	Borrowing Procedure	53
SECTION 2.04	Evidence of Debt; Repayment of Loans	53
SECTION 2.05	Fees	54
SECTION 2.06	Interest on Loans	56
SECTION 2.07	Termination and Reduction of Commitments	56
SECTION 2.08	Interest Elections	57
SECTION 2.09	Amortization of Term Borrowings	58
SECTION 2.10	Optional and Mandatory Prepayments of Loans	59
SECTION 2.11	Alternate Rate of Interest	63
SECTION 2.12	Yield Protection	64
SECTION 2.13	Breakage Payments	65
SECTION 2.14	Payments Generally; Pro Rata Treatment; Sharing of Setoffs	66
SECTION 2.15	Taxes	68
SECTION 2.16	Mitigation Obligations; Replacement of Lenders	71
SECTION 2.17	Swingline Loans	72
SECTION 2.18	Letters of Credit	74
SECTION 2.19	Defaulting Lenders	80
SECTION 2.20	Increase in Commitments	82
ARTICLE III.
REPRESENTATIONS AND WARRANTIES
SECTION 3.01	Organization; Powers	85
SECTION 3.02	Authorization; Enforceability	86

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SECTION 3.03	No Conflicts	86
SECTION 3.04	Financial Statements; Projections	86
SECTION 3.05	Properties	87
SECTION 3.06	Intellectual Property	87
SECTION 3.07	Equity Interests and Subsidiaries	88
SECTION 3.08	Litigation; Compliance with Laws	88
SECTION 3.09	Agreements	89
SECTION 3.10	Federal Reserve Regulations	89
SECTION 3.11	Investment Company Act	90
SECTION 3.12	Use of Proceeds	90
SECTION 3.13	Taxes	90
SECTION 3.14	No Material Misstatements	91
SECTION 3.15	Labor Matters	91
SECTION 3.16	Solvency	91
SECTION 3.17	Employee Benefit Plans	92
SECTION 3.18	Environmental Matters	92
SECTION 3.19	Insurance	93
SECTION 3.20	Security Documents	93
SECTION 3.21	Merger Documents	95
SECTION 3.22	Anti-Terrorism Laws	95
SECTION 3.23	No Conflict with Customs, International Trade and OFAC Laws	95
ARTICLE IV.
CONDITIONS TO CREDIT EXTENSIONS
SECTION 4.01	Conditions to Initial Credit Extension	96
SECTION 4.02	Conditions to All Credit Extensions	102
ARTICLE V.
AFFIRMATIVE COVENANTS
SECTION 5.01	Financial Statements, Reports, etc.	103
SECTION 5.02	Litigation and Other Notices	106
SECTION 5.03	Existence; Businesses and Properties	106
SECTION 5.04	Insurance	107
SECTION 5.05	Obligations and Taxes	108
SECTION 5.06	Employee Benefits	108
SECTION 5.07	Maintaining Records; Access to Properties and Inspections	109
SECTION 5.08	Use of Proceeds	109
SECTION 5.09	Compliance with Environmental Laws; Environmental Reports	110
SECTION 5.10	[Reserved]	110
SECTION 5.11	Additional Collateral; Additional Guarantors	112
SECTION 5.12	Security Interests; Further Assurances	112
SECTION 5.13	Information Regarding Collateral	113
SECTION 5.14	Maintenance of Ratings	113

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SECTION 5.15	Compliance with Laws	113
SECTION 5.16	Post-Closing Matters	113
ARTICLE VI.
NEGATIVE COVENANTS

SECTION 6.01	Indebtedness	114
SECTION 6.02	Liens	117
SECTION 6.03	Sale and Leaseback Transactions	120
SECTION 6.04	Investment, Loan, Advances and Acquisition	120
SECTION 6.05	Mergers and Consolidations	122
SECTION 6.06	Asset Sales	123
SECTION 6.07	Dividends	124
SECTION 6.08	Transactions with Affiliates	126
SECTION 6.09	Financial Covenants	127
SECTION 6.10	Prepayments of Other Indebtedness; Modifications of Organizational Documents and Other Documents, etc.	128
SECTION 6.11	Limitation on Certain Restrictions on Restricted Subsidiaries	129
SECTION 6.12	Limitation on Issuance of Capital Stock	130
SECTION 6.13	Limitation on Creation of Subsidiaries	130
SECTION 6.14	Business	131
SECTION 6.15	Limitation on Accounting Changes	131
SECTION 6.16	Fiscal Year	131
SECTION 6.17	No Further Negative Pledge	131
SECTION 6.18	Compliance with Anti-Terrorism Laws	132
ARTICLE VII.
GUARANTEE
SECTION 7.01	The Guarantee	132
SECTION 7.02	Obligations Unconditional	133
SECTION 7.03	Reinstatement	134
SECTION 7.04	Subrogation; Subordination	134
SECTION 7.05	Remedies	134
SECTION 7.06	Instrument for the Payment of Money	135
SECTION 7.07	Continuing Guarantee	135
SECTION 7.08	General Limitation on Guarantee Obligations	135
SECTION 7.09	Release of Guarantors	136
SECTION 7.10	Right of Contribution	136
ARTICLE VIII.
EVENTS OF DEFAULT
SECTION 8.01	Events of Default	137

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SECTION 8.02	Application of Proceeds	140
ARTICLE IX.
THE ADMINISTRATIVE AGENT AND THE COLLATERAL AGENT
SECTION 9.01	Appointment and Authority	141
SECTION 9.02	Rights as a Lender	141
SECTION 9.03	Exculpatory Provisions	142
SECTION 9.04	Reliance by Agent	143
SECTION 9.05	Delegation of Duties	143
SECTION 9.06	Resignation of Agent	143
SECTION 9.07	Non-Reliance on Agent and Other Lenders	145
SECTION 9.08	Withholding Tax	145
SECTION 9.09	No Other Duties, etc	145
SECTION 9.10	Enforcement	146
ARTICLE X.
MISCELLANEOUS
SECTION 10.01	Notices	146
SECTION 10.02	Waivers; Amendment	150
SECTION 10.03	Expenses; Indemnity; Damage Waiver	155
SECTION 10.04	Successors and Assigns	157
SECTION 10.05	Survival of Agreement	161
SECTION 10.06	Counterparts; Integration; Effectiveness	162
SECTION 10.07	Severability	162
SECTION 10.08	Right of Setoff	162
SECTION 10.09	Governing Law; Jurisdiction; Consent to Service of Process	163
SECTION 10.10	Waiver of Jury Trial	164
SECTION 10.11	Headings	164
SECTION 10.12	Treatment of Certain Information; Confidentiality	164
SECTION 10.13	USA PATRIOT Act Notice and Customer Verification	165
SECTION 10.14	Interest Rate Limitation	165
SECTION 10.15	Lender Addendum	166
SECTION 10.16	Obligations Absolute	166

ANNEXES
Annex I	Amortization Table
EXHIBITS
Exhibit A	Form of Administrative Questionnaire
Exhibit B	Form of Assignment and Assumption
Exhibit C	Form of Borrowing Request

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Exhibit D	Form of Compliance Certificate
Exhibit E	Form of Interest Election Request
Exhibit F	Form of Joinder Agreement
Exhibit G	[Reserved]
Exhibit H	Form of LC Request
Exhibit I	Form of Lender Addendum
Exhibit J	Form of Mortgage
Exhibit K-1	Form of Term Note
Exhibit K-2	Form of Revolving Note
Exhibit K-3	Form of Swingline Note
Exhibit L-1	Form of Perfection Certificate
Exhibit L-2	Form of Perfection Certificate Supplement
Exhibit M	Form of Security Agreement
Exhibit N	[Reserved]
Exhibit O	Form of Solvency Certificate
Exhibit P	Form of Intercompany Subordination Agreement
Exhibit Q	Form of Non-Bank Certificate

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CREDIT AGREEMENT

This CREDIT AGREEMENT (this “Agreement”) dated as of February 11, 2011, among CPI INTERNATIONAL ACQUISITION, INC. (f/k/a CATALYST HOLDINGS, INC.), a Delaware corporation (“Borrower”), CPI INTERNATIONAL HOLDING CORP. (f/k/a CATALYST HOLDINGS 2, INC.), a Delaware corporation (“Holdings”), the Subsidiary Guarantors (such term and each other capitalized term used but not defined herein having the meaning given to it in Article I), the Lenders, UBS SECURITIES LLC, as the sole lead arranger (in such capacity, the “Arranger”) and as the sole lead bookrunner (in such capacity, the “Bookrunner”), Bank of the West and GE Capital Financial Inc., as co-documentation agents (in such capacity, the “Co-Documentation Agents”), KKR CAPITAL MARKETS LLC, as syndication agent (in such capacity, “Syndication Agent”), UBS LOAN FINANCE LLC, as swingline lender (in such capacity, “Swingline Lender”), and UBS AG, STAMFORD BRANCH, as issuing bank (in such capacity, “Issuing Bank”), as administrative agent (in such capacity, “Administrative Agent”) for the Lenders and as collateral agent (in such capacity, “Collateral Agent”) for the Secured Parties and the Issuing Bank.

WITNESSETH:

WHEREAS, Borrower, a direct Wholly Owned Subsidiary of Holdings, has entered into an agreement and plan of merger, dated as of November 24, 2010 (as amended, supplemented or otherwise modified from time to time in accordance with the provisions hereof and thereof, the “Merger Agreement”), with Catalyst Acquisition, Inc., a Delaware corporation and Wholly Owned Subsidiary of Borrower (“Merger Sub”), and CPI International, Inc., a Delaware corporation (the “Acquired Business”), whereby Merger Sub shall merge (the “Merger”) with and into the Acquired Business, with the Acquired Business being the surviving corporation in the Merger and a Wholly Owned Subsidiary of Borrower.

WHEREAS, the Equity Financing shall be consummated simultaneously herewith.

WHEREAS, Borrower has requested the Lenders to extend credit in the form of (a) Term B Loans on the Closing Date, in an aggregate principal amount not in excess of $150,000,000, and (b) Revolving Loans at any time and from time to time prior to the Revolving Maturity Date, in an aggregate principal amount at any time outstanding not in excess of $30,000,000; provided however, that (x) Revolving Loans made on the Closing Date may only be used to (A) pay fees and expenses related to the Transactions in an aggregate amount not greater than $5,000,000 and (B) to fund upfront fees as provided in the Fee Letter, (y) no Swingline Loans may be made at the Closing Date and (z) only Letters of Credit replacing or backing existing letters of credit of Borrower and its Restricted Subsidiaries may be issued on the Closing Date.

WHEREAS, Borrower has requested the Swingline Lender to make Swingline Loans, at any time and from time to time prior to the Revolving Maturity Date, in an aggregate principal amount at any time outstanding not in excess of $5,000,000.

WHEREAS, Borrower has requested the Issuing Bank to issue letters of credit, in an aggregate face amount at any time outstanding not in excess of $15,000,000.

WHEREAS, the proceeds of the Loans are to be used in accordance with Section 3.12.

WHEREAS, Borrower shall issue the Senior Notes upon the initial funding hereunder.

NOW, THEREFORE, the Lenders are willing to extend such credit to Borrower and the Issuing Bank is willing to issue letters of credit for the account of Borrower on the terms and subject to the conditions set forth herein.  Accordingly, the parties hereto agree as follows:

ARTICLE I.

DEFINITIONS

SECTION 1.01              Defined Terms.

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

“ABR”, when used in reference to any Loan or Borrowing, is used when such Loan, or the Loans comprising such Borrowing, are bearing interest at a rate determined by reference to the Alternate Base Rate.

“ABR Borrowing” shall mean a Borrowing comprised of ABR Loans.

“ABR Loan” shall mean any ABR Term Loan or ABR Revolving Loan.

“ABR Revolving Loan” shall mean any Revolving Loan bearing interest at a rate determined by reference to the Alternate Base Rate in accordance with the provisions of Article II.

“ABR Term Loan” shall mean any Term Loan bearing interest at a rate determined by reference to the Alternate Base Rate in accordance with the provisions of Article II.

“Acquired Business” shall have the meaning assigned to such term in the first recital hereto.

“Acquisition Consideration” shall mean the purchase consideration for any Permitted Acquisition and all other payments by Holdings or any of its Restricted Subsidiaries in exchange for, or as part of, or in connection with, any Permitted Acquisition, whether paid in cash or by exchange of Equity Interests or of properties or otherwise and whether payable at or prior to the consummation of such Permitted Acquisition or deferred for payment at any future time, whether or not any such future payment is subject to the occurrence of any contingency, and includes any and all payments representing the purchase price and any assumptions of Indebtedness, “earn-outs” and other agreements to make any payment the amount of which is, or the terms of payment of which are, in any respect subject to or contingent upon the revenues, income, cash flow or profits (or the like) of any person or business; provided that any such future payment that is subject to a contingency shall be considered Acquisition Consideration only to the extent either (i) the obligation to make such payment is required to be reflected on the face of the balance sheet of Holdings or any of its Restricted Subsidiaries or (ii) a reserve is required to be established in respect thereof by Holdings or any of its Restricted Subsidiaries, in each case under GAAP at the time of such Permitted Acquisition, but if and to the extent that such contingency fails to occur in accordance with the terms of the applicable documentation, no amount in respect thereof shall be included as part of the Acquisition Consideration thereafter.

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“Acceptable Opinion” shall have the meaning assigned to such term in Section 5.01(a).

“Acquisition Threshold” shall mean $150,000,000.

“Adjusted LIBOR Rate” shall mean, with respect to any Eurodollar Borrowing or with respect to an ABR Borrowing (to the extent Alternate Base Rate is then determined pursuant to clause (c) of the definition thereof) for any Interest Period, the greater of (a)(i) an interest rate per annum (rounded upward, if necessary, to the nearest 1/100th of 1%) determined by the Administrative Agent to be equal to the LIBOR Rate for such Eurodollar Borrowing in effect for such Interest Period divided by (ii) 1 minus the Statutory Reserves (if any) for such Eurodollar Borrowing for such Interest Period or (b) 1.00% per annum.

“Administrative Agent” shall have the meaning assigned to such term in the preamble hereto and shall include each other person appointed as a successor pursuant to Section 9.06(a).

“Administrative Agent Fees” shall have the meaning assigned to such term in Section 2.05(b).

“Administrative Questionnaire” shall mean an Administrative Questionnaire in substantially the form of Exhibit A.

“Advisory Agreement” shall mean Advisory Agreement, dated as of February 11, 2011, by and between Borrower and Veritas Capital Fund Management, L.L.C., a Delaware limited liability company.

“Affidavit of No Change to Survey” shall mean, with respect to a survey, an affidavit stating that since the last date of such survey there have been no additions, alterations of improvements of or to the land or to the exterior of the improvements as depicted on the survey or providing language of similar effect.

“Affiliate” shall mean, when used with respect to a specified person, another person that directly, or indirectly through one or more intermediaries, Controls or is Controlled by or is under common Control with the person specified; provided, however, that, for purposes of Section 6.08, the term “Affiliate” shall also include any person that directly or indirectly owns more than 10% of any class of Equity Interests of the person specified.

“Affiliated Lender” shall mean any Lender that is an Affiliate of Borrower (other than Holdings or a Subsidiary thereof).

“Agents” shall mean the Administrative Agent and the Collateral Agent; and “Agent” shall mean any of them.

“Agreement” shall have the meaning assigned to such term in the preamble hereto.

“Alternate Base Rate” shall mean, for any day, a fluctuating rate per annum (rounded upward, if necessary, to the nearest 1/100th of 1%) equal to the greatest of (a) the Base Rate in effect on such day, (b) the Federal Funds Effective Rate in effect on such day plus 0.50% and (c) the Adjusted LIBOR Rate for an Interest Period of one-month beginning on such day (or if such

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day is not a Business Day, on the immediately preceding Business Day) plus 100 basis points.  If the Administrative Agent shall have determined (which determination shall be conclusive absent manifest error) that it is unable to ascertain the Federal Funds Effective Rate for any reason, including the inability or failure of the Administrative Agent to obtain sufficient quotations in accordance with the terms of the definition thereof, the Alternate Base Rate shall be determined without regard to clause (b) of the preceding sentence until the circumstances giving rise to such inability no longer exist.  Any change in the Alternate Base Rate due to a change in the Base Rate or the Federal Funds Effective Rate shall be effective on the effective date of such change in the Base Rate or the Federal Funds Effective Rate, respectively.

“Anti-Terrorism Laws” shall mean any Requirement of Law related to terrorism financing, economic sanctions or money laundering, including 18 U.S.C. §§ 1956 and 1957; The Currency and Foreign Transactions Reporting Act (also known as the “Bank Secrecy Act”, 31 U.S.C. §§ 5311-5332 and 12 U.S.C. §§ 1818(s), 1820b and 1951-1959), as amended by the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act (“USA PATRIOT Act”) of 2001 (Title III of Pub. L. 107-56), and their implementing regulations; the Trading With the Enemy Act (50 U.S.C. § 1 et seq., as amended), the International Emergency Economic Powers Act (50 U.S.C. §1701 et seq., as amended) and Executive Order 13224 (effective September 24, 2001), and their implementing regulations.

“Applicable Calculations” shall have the meaning assigned to such term in Section 1.04.

“Applicable ECF Percentage” shall mean, for any Excess Cash Flow Period, (a) 50% if the Total Leverage Ratio as of the last day of such Excess Cash Flow Period is greater than or equal to 5.00 to 1.00, (b) 25% if the Total Leverage Ratio as of the last day of such Excess Cash Flow Period is less than 5.00 to 1.00 but greater than or equal to 3.00 to 1.00, and (c) 0% if the Total Leverage Ratio as of the last day of such Excess Cash Flow Period is less than 3.00 to 1.00.

“Applicable Fee” shall mean 0.75% per annum.

“Applicable Margin” shall mean, for any day, with respect to any (A) Term B Loan that is (x) a Eurodollar Loan, 4.00% per annum and (y) an ABR Loan, 3.00% per annum, (B) Revolving Loan that is (x) a Eurodollar Loan, 4.50% per annum and (y) an ABR Loan, 3.50% per annum and (C) Swingline Loan, 3.50% per annum.  The Applicable Margin with respect to Incremental Term Loans shall be as set forth in the applicable Increase Joinder.

“Approved Fund” shall mean any Fund that is administered or managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an Affiliate of an entity that administers or manages a Lender.

“Arranger” shall have the meaning assigned to such term in the preamble hereto.

“Asset Sale” shall mean (a) any conveyance, sale, lease, sublease, license, assignment, transfer or other disposition (including by way of merger or consolidation and including any Sale and Leaseback Transaction) of any property (excluding any sale of inventory or disposition of cash and Cash Equivalents, in each case, in the ordinary course of business) by Holdings or any of its Restricted Subsidiaries and (b) any issuance or sale of any Equity Interests of any Restricted Subsidiary of Holdings, in the case of each of clause (a) and (b), to any person other than

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a Company; provided that to the extent such a sale, issuance, conveyance, lease, sublease, license, assignment, transfer or other disposition of assets is made from a Loan Party to a Company that is not a Loan Party, the Loan Party effectuating such sale, issuance conveyance, lease, sublease, license, assignment, issuance, transfer or other disposition shall receive assets in exchange therefor at least equal to the fair market value of the assets such Loan Party so sold, conveyed, leased, subleased, licensed, issued, assigned, transfered or other disposed of.

“Assignment and Assumption” shall mean an assignment and assumption entered into by a Lender and an Eligible Assignee (with the consent of any party whose consent is required by Section 10.04(b)), and accepted by the Administrative Agent, in substantially the form of Exhibit B, or any other form approved by the Administrative Agent.

“Attributable Indebtedness” shall mean, when used with respect to any Sale and Leaseback Transaction, as at the time of determination, the present value (discounted at a rate equivalent to the explicit or implicit interest rate under the lease applicable to such Sale and Leaseback Transaction, or if there is none, Borrower’s then-current weighted average cost of funds for borrowed money as at the time of determination, compounded on a semi-annual basis) of the total obligations of the lessee for rental payments during the remaining term of the lease included in any such Sale and Leaseback Transaction.

“Auto-Renewal Letter of Credit” shall have the meaning assigned to such term in Section 2.18(c)(ii).

“Available Basket Amount” shall mean, at any time of calculation, (a) the sum of (i) the Net Cash Proceeds received by Holdings after the Closing Date from any issuance of Qualified Capital Stock of Holdings, to the extent such Net Cash Proceeds are contributed in cash to Borrower to Borrower’s common equity capital; provided that no proceeds of any Specified Equity Contribution or the Equity Financing shall be included in amounts referred to in this clause (a) plus (ii) the Cumulative Retained ECF Amount at such time minus (b) the aggregate amount of Investments, Permitted Acquisitions, Capital Expenditures, Dividends and prepayments, repurchases or redemptions of Indebtedness, in each case to the extent made after the Closing Date (in whole or in part) in reliance on the Available Basket Amount.

“Available Net Assets” shall have the meaning assigned to such term in Section 7.10.

“Bankruptcy Code” shall mean Title 11 of the United States Code (11 U.S.C. Section 101 et seq.), as amended from time to time.

“Base Rate” shall mean, for any day, a rate per annum that is equal to the corporate base rate of interest established by the Administrative Agent from time to time; each change in the Base Rate shall be effective on the date such change is effective.  The corporate base rate is not necessarily the lowest rate charged by the Administrative Agent to its customers.

“Board” shall mean the Board of Governors of the Federal Reserve System of the United States.

“Board of Directors” shall mean, with respect to any person, (i) in the case of any corporation, the board of directors of such person, (ii) in the case of any limited liability company, the

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board of managers of such person, or if there is none, the Board of Directors of the managing member of such Person, (iii) in the case of any partnership, the Board of Directors of the general partner of such person and (iv) in any other case, the functional equivalent of the foregoing.

“Bookrunner” shall have the meaning assigned to such term in the preamble hereto.

“Borrower” shall have the meaning assigned to such term in the preamble hereto.

“Borrowing” shall mean (a) Loans of the same Class and Type, made, converted or continued on the same date and, in the case of Eurodollar Loans, as to which a single Interest Period is in effect, or (b) a Swingline Loan.

“Borrowing Request” shall mean a request by Borrower in accordance with the terms of Section 2.03 and substantially in the form of Exhibit C, or such other form as shall be reasonably approved by the Administrative Agent.

“Business Day” shall mean any day other than a Saturday, Sunday or other day on which banks in New York City are authorized or required by law to close; provided, however, that when used in connection with a Eurodollar Loan, the term “Business Day” shall also exclude any day on which banks are not open for dealings in dollar deposits in the London interbank market.

“Business Material Adverse Effect” shall mean any event, development, change, effect or state of facts that, individually or in the aggregate, has had or would reasonably be expected to have a material adverse effect in or on the condition (financial or otherwise), business, properties or results of operations of the Acquired Business and its Subsidiaries (for purposes of this definition of “Business Material Adverse Effect, “Subsidiaries” shall have the meaning assigned to such term in the Merger Agreement), taken as a whole; provided, however, that (except as otherwise stated) none of the following, and no event, development, change, effect or state of facts that, to the extent resulting from any of the following, shall be deemed to be or contribute to, or be taken into account in determining whether there has been or would reasonably be expected to be a Business Material Adverse Effect:  (i) general changes in economic, market, financial or capital market, regulatory or political conditions in the United States or elsewhere in the world, (ii) terrorism, war, hostilities or natural disaster occurring in the United States or elsewhere in the world, (iii) changes in conditions generally applicable to the industry or industries in which the Acquired Business and its Subsidiaries are involved, (iv) changes in the Law (as defined in the Merger Agreement) or changes in U.S. generally accepted accounting principles or interpretations thereof, (v) any change in the Acquired Business’s stock price or trading volume, or any failure, in and of itself, by the Acquired Business to meet any internal or published (by the Acquired Business or otherwise) projections, forecasts or revenue or earnings predictions or any change in any analyst recommendation concerning the Acquired Business (it being understood that the facts or occurrences giving rise or contributing to such change in stock price or trading volume or such failure to meet projections, forecasts or predictions or such change in analyst recommendation may be deemed to constitute, or be taken into account in determining whether there has been or will be, a Business Material Adverse Effect, if not otherwise excepted from the definition of Business Material Adverse Effect), (vi) the downgrade in rating of any debt or debt securities of the Acquired Business or any of its Subsidiaries (it being understood that the facts or occurrences giving rise or contributing to such downgrade may be deemed to constitute, or be

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taken into account in determining whether there has been or will be, a Business Material Adverse Effect, if not otherwise excepted from the definition of Business Material Adverse Effect), (vii) the failure to take any action as a result of any restrictions or prohibitions set forth in the Merger Agreement with respect to which Borrower failed, following the Acquired Business’s request, to provide a written waiver, in each case, to the extent the resulting adverse event, development, change, effect or state of facts would have been reasonably foreseeable by Borrower at such time the waiver is requested by the Acquired Business, (viii) events, developments, changes, effects or state of facts resulting from any action specifically consented to in writing by Borrower (with the approval of the Arranger) following written request to take such action by the Acquired Business, in each case, to the extent the resulting adverse event, development, change, effect or state of facts would have been reasonably foreseeable by Borrower at such time the waiver is requested by the Acquired Business, (ix) the taking of any action expressly required by the Merger Agreement or the consummation of the transactions contemplated hereby, or (x) the execution, announcement or pendency of the Merger Agreement or the transactions contemplated by the Merger Agreement, including any stockholder, derivative or similar actions, claims, suits or proceedings arising out of or related to the Merger Agreement or any of the transactions contemplated by the Merger Agreement or the Merger (provided, that the exceptions in clauses (ix) and (x) shall not apply to that portion of any representation or warranty contained in the Merger Agreement to the extent that such representation or warranty expressly addresses the consequences resulting from the entry into the Merger Agreement or the performance or consummation of the transactions contemplated by the Merger Agreement or the Merger or performance of the Acquired Business’s obligations under the Merger Agreement), except to the extent, in the case of clauses (i) through (iv) above, such changes would reasonably be expected to have a materially disproportionate impact on the condition (financial or otherwise), business, properties or results of operations of the Acquired Business and its Subsidiaries, taken as a whole, relative to other participants in the industry or industries in which the Acquired Business and its Subsidiaries are involved (in which event the extent of such material adverse change may be taken into account in determining whether a Business Material Adverse Effect has occurred).

“Calculation Date” shall have the meaning assigned to such term in Section 1.04(c).

“California Mortgage” shall mean any Mortgage that encumbers real property located in the State of California.

“Capital Assets” shall mean, with respect to any person, all equipment, fixed assets and Real Property or improvements of such person, or replacements or substitutions therefor or additions thereto, that, in accordance with GAAP, have been or should be reflected as additions to property, plant or equipment on the balance sheet of such person.

“Capital Expenditures” shall mean, for any period, without duplication, all expenditures made directly or indirectly by Holdings and its Restricted Subsidiaries during such period for Capital Assets (whether paid in cash or other consideration, financed by the incurrence of Indebtedness or accrued as a liability), but excluding (i) any such expenditures made in connection with the replacement, substitution or restoration of property with the proceeds of Asset Sales or Casualty Events, (ii) any portion of such expenditures attributable solely to acquisitions of property, plant and equipment in Investments pursuant to Sections 6.04(h), (l)(ii)(C), (k), (r) and, to the extent such Investment is not in a person that is an existing Company, (s), (iii) expenditures

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for Capital Assets of Holdings and its Restricted Subsidiaries made by persons other than Holdings and its Restricted Subsidiaries and (iv) any such expenditure by Holdings and its Restricted Subsidiaries that is reimbursed in cash within 180 days of such expenditure by a person other than Holdings or any of its Restricted Subsidiaries.  For purposes of this definition, the purchase price of equipment or fixed assets that are purchased simultaneously with the exchange or trade-in of existing assets shall be included in Capital Expenditures only to the extent of the gross amount by which such purchase price exceeds the credit granted by the seller of such assets for the assets being exchanged or traded in at such time, as the case may be.

“Capital Lease Obligations” of any person shall mean the obligations of such person to pay rent or other amounts under any lease of (or other arrangement conveying the right to use) real or personal property, or a combination thereof, which obligations are required to be classified and accounted for as capital lease obligations on a balance sheet of such person under GAAP as in effect on the date hereof, and the amount of such obligations shall be the capitalized amount thereof determined in accordance with GAAP as in effect on the date hereof.

“Cash Equivalents” shall mean, as to any person, (a) securities issued, or directly, unconditionally and fully guaranteed or insured, by the United States or any agency or instrumentality thereof (provided that the full faith and credit of the United States is pledged in support thereof) having maturities of not more than 13 months from the date of acquisition by such person; (b) time deposits and certificates of deposit of any Lender or any commercial bank having, or which is the principal banking subsidiary of a bank holding company organized under the laws of the United States, any state thereof or the District of Columbia having, capital and surplus aggregating in excess of $500,000,000 and a rating of “A” (or such other similar equivalent rating) or higher by at least one nationally recognized statistical rating organization (as defined in Rule 436 under the Securities Act) with maturities of not more than one year from the date of acquisition by such person; (c) repurchase obligations with a term of not more than 90 days for underlying securities of the types described in clause (a) above entered into with any bank meeting the qualifications specified in clause (b) above, which repurchase obligations are secured by a valid perfected security interest in the underlying securities; (d) commercial paper issued by any person incorporated in the United States rated at least A-1 or the equivalent thereof by S&P or at least P-1 or the equivalent thereof by Moody’s, and in each case maturing not more than 13 months after the date of acquisition by such person; (e) investments in money market funds substantially all of whose assets are comprised of securities of the types described in clauses (a) through (d) above; (f) demand deposit accounts maintained in the ordinary course of business; and (g) investments by any Foreign Subsidiaries in any foreign equivalents of the investments described in clauses (a) through (e) above, provided that, (i) investments described in this clause (g) by any Foreign Subsidiary shall be limited to (1) securities issued by a country that is a member nation of the Organization of Economic Cooperation and Development or by issuers formed under the laws of such a country, or (2) in the case of Foreign Subsidiaries operating in countries that are not member nations of the Organization of Economic Cooperation and Development,  investments customarily used by corporations for cash management purposes in such jurisdictions in the ordinary course of business of such corporations and (ii) in the case of investments equivalent to clause (a), the issuer has an investment grade sovereign debt rating from S&P or Moody’s.

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“Cash Interest Coverage Ratio” shall mean, for any Test Period, the ratio of (x) Consolidated EBITDA for such Test Period to (y) Cash Interest Expense for such Test Period.

“Cash Interest Expense” shall mean, for any period, Consolidated Interest Expense for such period paid in cash, less the sum of (a) to the extent included in Consolidated Interest Expense and paid in cash during such period, amortization of debt issuance costs, debt discount or premium and other financing fees and expenses incurred by Holdings or any of its Restricted Subsidiaries for such period including, without limitation, net costs under Hedging Agreements dealing with interest rates and any commitment fees under such Hedging Agreements and (b) any one-time cash costs paid in such period associated with breakage in respect of Hedging Agreements for interest rates; provided that, subject to adjustment for events occurring after the Closing Date pursuant to Section 1.04, when determining Cash Interest Expense of Borrower in respect of any Test Period ending prior to the first anniversary of the Closing Date, Cash Interest Expense shall be calculated by multiplying the aggregate Cash Interest Expense accrued since the Closing Date by 365 and then dividing such product by the number of days from and including the Closing Date to and including the last day of such Test Period.  If the Cash Interest Coverage Ratio must be calculated on a Pro Forma Basis for the four-fiscal quarter period ending on or about January 1, 2011 in order to determine the permissibility of a transaction hereunder, then, solely for such purpose, the Transactions shall be deemed to have been consummated on October 1, 2010 and Cash Interest Expense shall equal the Cash Interest Expense for the fiscal quarter of Borrower ended January 1, 2011 times four.

“Casualty Event” shall mean any involuntary loss of title, any involuntary loss of, damage to or any destruction of, or any condemnation or other taking (including by any Governmental Authority) of, any property of Holdings or any of its Restricted Subsidiaries.  “Casualty Event” shall include but not be limited to any taking of all or any part of any Real Property of any person or any part thereof, in or by condemnation or other eminent domain proceedings pursuant to any Requirement of Law, or by reason of the temporary requisition of the use or occupancy of all or any part of any Real Property of any person or any part thereof by any Governmental Authority, civil or military, or any settlement in lieu thereof.

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

“CFC” shall mean a Foreign Subsidiary that is a “controlled foreign corporation” within the meaning of Section 957 of the Code.

“CFC Holdco” shall mean a Domestic Subsidiary that is a disregarded entity for U.S. federal income tax purposes and has no material assets other than Equity Interests of one or more CFCs.

A “Change in Control” shall be deemed to have occurred if:

(a)           Holdings at any time ceases to own directly 100% of the Equity Interests of Borrower;

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(b)           at any time a change of control occurs under the Senior Notes (or any refinancing thereof);

(c)           prior to an IPO, the Permitted Holders (collectively) shall fail to own, or to have the power, directly or indirectly, to vote or direct the voting of Voting Stock of Holdings representing a majority of the voting power of the total outstanding Voting Stock of Holdings;

(d)           upon and following an IPO, any “person” or “group” (as such terms are used in Sections 13(d) and 14(d) of the Exchange Act), other than one or more Permitted Holders, is or becomes the beneficial owner (as defined in Rules 13d-3 and 13d-5 under the Exchange Act), directly or indirectly, of Voting Stock of Holdings representing more than both (i) 35% of the voting power of the total outstanding Voting Stock of Holdings and (ii) the percentage of the voting power of the total outstanding Voting Stock of Holdings that the Permitted Holders (collectively) own or which they have the power, directly or indirectly, to vote or direct the voting of; or

(e)           upon and following an IPO, during any period of two consecutive years, individuals who at the beginning of such period constituted the Board of Directors of Holdings or any parent company (together with any new directors whose election to such Board of Directors or whose nomination for election was approved by a vote of a majority of the members of the Board of Directors of Holdings or any parent company, which members comprising such majority are then still in office and were either directors at the beginning of such period or whose election or nomination for election was previously so approved) cease for any reason to constitute a majority of the Board of Directors of Holdings or any parent company.

For purposes of this definition, a person shall not be deemed to have beneficial ownership of Equity Interests subject to a stock purchase agreement, merger agreement or similar agreement until the consummation of the transactions contemplated by such agreement.

“Change in Law” shall mean the occurrence, after the date of this Agreement, of any of the following:  (a) the adoption or taking into effect of any law, treaty, order, policy, rule or regulation, (b) any change in any law, treaty, order, policy, rule or regulation or in the administration, interpretation or application thereof by any Governmental Authority or (c) the making or issuance of any guideline or directive (whether or not having the force of law) by any Governmental Authority.

“Charges” shall have the meaning assigned to such term in Section 10.14.

“Class,” when used in reference to any Loan or Borrowing, refers to whether such Loan, or the Loans comprising such Borrowing, are Revolving Loans, Term B Loans, Incremental Term Loans that have identical terms and conditions or Swingline Loans and, when used in reference to any Commitment, refers to whether such Commitment is a Revolving Commitment, Term B Loan Commitment, Incremental Term Loan Commitment with respect to Incremental Term Loans that have identical terms and conditions or Swingline Commitment, in each case,

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under this Agreement as originally in effect or pursuant to Section 2.20, of which such Loan, Borrowing or Commitment shall be a part.

“Closing Date” shall mean the date of the initial Credit Extension hereunder.

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

“Co-Documentation Agents” shall have the meaning assigned to such term in the preamble hereto.

“Collateral” shall mean, collectively, all of the Security Agreement Collateral, the Mortgaged Property and all other property of whatever kind and nature subject or purported to be subject from time to time to a Lien under any Security Document.

“Collateral Agent” shall have the meaning assigned to such term in the preamble hereto and shall include each other person appointed as a successor pursuant to Section 9.06(a).

“Commercial Letter of Credit” shall mean any letter of credit or similar instrument issued for the purpose of providing credit support in connection with the purchase of materials, goods or services by Borrower or any of its Restricted Subsidiaries.

“Commitment” shall mean, with respect to any Lender, such Lender’s Revolving Commitment, Term B Loan Commitment or Swingline Commitment, and any Commitment to make Incremental Term Loans of a new Class extended by such Lender as provided in Section 2.20.

“Commitment Fee” shall have the meaning assigned to such term in Section 2.05(a).

“Commitment Letter” shall mean the commitment letter, dated as of November 24, 2010, between Borrower, UBS AG, Stamford Branch and UBS Securities LLC.

“common stock” or “common equity” shall mean, with respect to any person, any and all “common” Equity Interests (however designated) of such person whether now outstanding or issued after the Closing Date, provided that neither Preferred Stock nor Disqualified Capital Stock shall constitute common stock.

“Communications” shall have the meaning assigned to such term in Section 10.01(b).

“Companies” shall mean Holdings and its Restricted Subsidiaries, including Borrower; and “Company” shall mean any one of them.

“Competitor” shall mean any person whose primary business is microwave, radio frequency (“RF”), power and control products for critical defense, communications, medical, scientific and other applications, or developing, manufacturing and distributing products used for generating, amplifying, transmitting and receiving high-power/high-frequency microwave and RF signals and/or providing power and control for various applications, or such other business conducted by Borrower and its Restricted Subsidiaries in the normal course.

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“Compliance Certificate” shall mean a certificate of a Financial Officer substantially in the form of Exhibit D.

“Confidential Information Memorandum” shall mean that certain confidential information memorandum dated as of January 2011 provided to Lenders with respect to the Companies and the Transactions.

“Consolidated Current Assets” shall mean, as at any date of determination, the total assets of Holdings and its Restricted Subsidiaries on a consolidated basis that may properly be classified as current assets in conformity with GAAP, excluding cash and Cash Equivalents.

“Consolidated Current Liabilities” shall mean, as at any date of determination, the total liabilities of Holdings and its Restricted Subsidiaries on a consolidated basis that may properly be classified as current liabilities in conformity with GAAP, excluding the current portion of long term debt.

“Consolidated EBITDA” shall mean, for any period, an amount determined for Holdings and its Restricted Subsidiaries on a consolidated basis equal to:

(i)            Consolidated Net Income, plus, to the extent reducing (and not added back to) such Consolidated Net Income (other than in the case of clause (f) hereof), the sum, without duplication, of amounts (calculated on an after tax basis where appropriate) for (a) provision for taxes based on income or profit or capital, including state, local and franchise taxes (or the non-U.S. equivalent thereof) for such period (including tax expenses of Foreign Restricted Subsidiaries and foreign withholding taxes paid or accrued for such period), (b) Consolidated Interest Expense for such period, (c) the total amount of depreciation and amortization expenses (including amortization of goodwill and other intangibles, and all expenditures in respect of licensed or purchased software or internally developed software and software enhancements that are, or are required to be reflected as, capitalized costs, but excluding amortization of prepaid cash expenses that were paid in a prior period) for such period, (d) to the extent permitted to be made under Section 6.08(e), any management, monitoring, consulting and advisory fees (including termination fees) and related indemnities and expenses paid or accrued by Borrower in such period pursuant to the terms of the Advisory Agreement, (e) any other non-cash charges, expenses or losses reducing Consolidated Net Income for such period (provided that if any such non-cash charges, expenses or losses represent an accrual or reserve for potential cash items in any future period, the cash payment in respect thereof in such future period shall be subtracted from Consolidated Net Income to such extent), but excluding amortization of a prepaid cash item that was paid in a prior period, (f) cash receipts (or any netting arrangements resulting in reduced cash expenditures) not representing Consolidated Net Income in any period to the extent non-cash gains relating to such income were deducted in the calculation of Consolidated Net Income pursuant to clause (ii) below for any previous period, (g) the amount of any minority interest expense consisting of income of a Restricted Subsidiary attributable to minority equity interests of third parties in any non-wholly owned Restricted Subsidiary deducted in such period in calculating Consolidated Net Income, (h) any non-cash impairment charge or asset write-off or write-down, including impairment charges or asset write-offs or write downs related to

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intangible assets, long-lived assets, investments in debt and equity securities or otherwise as a result of a change in law or regulation (including the amortization of the consideration for any non-competition agreements entered into in connection with the transactions contemplated by the Transaction Documents), (i) any net loss from discontinued operations and any net loss on disposal of discontinued operations, (j) non-cash charges and expenses relating to employee benefit or other management compensation plans of any direct or indirect parent of Borrower (to the extent such non-cash charges relate to plans of any direct or indirect parent of Borrower for the benefit of members of the board of directors of Borrower (in their capacity as such) or employees of Borrower and its Restricted Subsidiaries), Borrower or any of its Restricted Subsidiaries or any non-cash compensation charge and other non-cash expenses or charges arising from any grant, issuance or repricing of stock appreciation or similar rights, stock, stock options, restricted stock or other equity based awards of any direct or indirect parent of Borrower (to the extent such non-cash charges relate to plans of any direct or indirect parent of Borrower for the benefit of members of the board of directors of Borrower (in their capacity as such) or employees of Borrower and its Restricted Subsidiaries), Borrower or any of its Restricted Subsidiaries (excluding in each case any non-cash charge to the extent that it represents an accrual of or reserve for cash expenses in any future period or amortization of a prepaid cash expense incurred in a prior period), (k) any losses attributable to the extinguishment of any (1) Indebtedness or (2) other derivative instruments of Borrower or any of its Restricted Subsidiaries, (l) any fees, expenses, costs or charges (including all transaction, restructuring and transition costs, fees and expenses (including diligence costs, cash severance costs, retention payments to employees, lease termination costs and reserves)) or any amortization thereof, related to any Subject Transaction (in each case including any such transaction undertaken but not completed), including (1) such fees, expenses or charges related to the Transactions and (2) any amendment or other modification hereof, (m) accruals and reserves (other than fees, expenses, costs or charges relating to the Transactions) that are established within twelve months after the Closing Date that are so required to be established as a result of the Merger or the other Transactions, provided that the aggregate amount under this clause (m) shall not exceed $5,000,000, (n) any extraordinary losses during such period in accordance with GAAP and (o) any non-recurring or unusual expenses, losses or charges; provided that the aggregate amount added to Consolidated EBITDA pursuant to this clause (o) shall not exceed $10,000,000 in such period; minus

(ii)           the sum, without duplication, of the following amounts (calculated on an after tax basis where appropriate) (a) non-cash gains increasing Consolidated Net Income for such period, excluding any such items to the extent they represent (1) the reversal in such period of an accrual of, or reserve for, potential cash expenses in a prior period after the Closing Date (which, for the avoidance of doubt, shall be deducted from Consolidated Net Income pursuant to clause (i)(e) above), and (2) the amortization of income and the accrual of revenue or income, in each case, to the extent cash is not received in the current period, (b) any net gain from discontinued operations or after-tax net gains from the disposal of discontinued operations to the extent increasing Consolidated Net Income, (c) any extraordinary, non-recurring or unusual gain to the extent increasing Consolidated Net Income and (d) the amount of any minority interest income consisting of Subsidiary

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Guarantor losses attributable to minority interests of third parties in any non-wholly owned Subsidiary Guarantor.

In addition, to the extent not already included in the Consolidated Net Income of Holdings and its Restricted Subsidiaries, notwithstanding anything to the contrary in the foregoing, Consolidated EBITDA shall include the amount of proceeds received from business interruption insurance and reimbursements of any expenses and charges that are covered by indemnification or other reimbursement provisions in connection with any Investment under Section 6.04(e), any Permitted Acquisition or any Asset Sale (or other disposition) permitted hereunder.  Furthermore, Consolidated EBITDA shall be calculated without regard to (1) without duplication of Section 1.05(a), the cumulative effect of a change in accounting principles and changes as a result of the adoption or modification of accounting policies during such period, and (2) effects of adjustments pursuant to GAAP resulting from the application of purchase accounting in relation to the Merger or any Permitted Acquisition, including, without limitation, write-offs of acquired in-process research and development, amortization of inventory write-ups and amortization of acquisition-related intangibles.

Notwithstanding the foregoing, Consolidated EBITDA (1)  for the fiscal quarter ended on or about June 30, 2010 shall be deemed to be $16,967,000, (2) for the fiscal quarter ended on or about September 30, 2010 shall be deemed to be $17,537,000 and (3) for the fiscal quarter ended on or about December 31, 2010 shall be deemed to be $13,433,000.  For the avoidance of doubt, the amounts set forth in this paragraph are subject to adjustment in accordance with Section 1.04.

For purposes of determining compliance with Sections 6.09(a) and (b), Holdings shall have the right to make a Specified Equity Contribution on or after the first day of any fiscal quarter and on or prior to ten Business Days after the date on which financial statements are required to be delivered pursuant to Section 5.01(a) or (b), as applicable, for such fiscal quarter which contribution will be included, at the request of Borrower, in the calculation of Consolidated EBITDA solely for the purposes of determining compliance with Sections 6.09(a) and (b) (but not, for the avoidance of doubt, for purposes of determining the permissibility of a transaction) at the end of such fiscal quarter and applicable subsequent periods which include such fiscal quarter; provided that (a) a Specified Equity Contribution may be made and included in the calculation of Consolidated EBITDA no more than two times per fiscal year and no more than four times during the term of this Agreement, (b) the amount of any Specified Equity Contribution included in the calculation of Consolidated EBITDA shall be no greater than the amount required to cause Borrower to be in pro forma compliance with Sections 6.09(a) and (b), and (c) the proceeds of any Specified Equity Contribution included in the calculation of Consolidated EBITDA shall be used to pay down the Loans and applied in the same manner as a mandatory prepayment pursuant to Section 2.10(g) (provided that such pay-down shall be disregarded for purposes of determining compliance with Sections 6.09(a) and (b) solely for such fiscal quarter).

“Consolidated Indebtedness” shall mean, as at any date of determination, the aggregate amount of all Indebtedness of Holdings and its Restricted Subsidiaries, but excluding letters of credit and Indebtedness permitted under Sections 6.01(c), (d), (g), (h), (i), (j), (n), (o), (q) and (r), minus up to an aggregate amount of $20,000,000 of unrestricted cash and Cash Equivalents on hand of Borrower and its Restricted Subsidiaries as of such date.

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“Consolidated Interest Expense” shall mean, for any period, total interest expense, whether paid or accrued (including that portion attributable to Capital Lease Obligations in accordance with GAAP, Attributable Indebtedness and capitalized interest) of Holdings and its Restricted Subsidiaries on a consolidated basis for such period with respect to all outstanding Indebtedness of Holdings and its Restricted Subsidiaries, including all amortization of debt issuance costs and original issue discount and other financing fees and expenses, non-cash interest payments, the interest component of any deferred payment obligations, imputed interest on Capital Lease Obligations, Attributable Indebtedness and with respect to commissions, discounts and other fees and charges owed with respect to letters of credit, cash contributions to any employee stock ownership plan or similar trust to the extent such contributions are used by such plan or trust to pay interest or fees to any person in connection with Indebtedness incurred by such plan or trust for such period, and net costs under Hedging Agreements in respect of interest rates, less interest income of Holdings and its Restricted Subsidiaries for such period.

“Consolidated Net Income” shall mean, for any period, the aggregate net income of Holdings and its Restricted Subsidiaries for such period, on a consolidated basis, determined in accordance with GAAP; provided that (a) the income of any person (other than a Restricted Subsidiary of Holdings) in which any other person (other than Holdings or any of its Restricted Subsidiaries) has a joint interest, except to the extent of the amount of dividends or other distributions actually paid to Holdings or any of its Restricted Subsidiaries by such person during such period shall be excluded, (b) any gain (loss), together with any related provision for taxes on such gain (loss), realized in connection with any Asset Sale or other asset disposition or abandonment (other than in the ordinary course of business) and reserves relating thereto shall be excluded, (c) any net unrealized gain (loss) (after any offset) resulting in such period from obligations under any Hedging Agreement or other derivative instruments and the application of ASC 815, in each case, shall be excluded, (d) any net unrealized gain (loss) (after any offset) resulting in such period from currency translation gains or losses including those related to currency re measurements of Indebtedness shall be excluded, (e) any gains (losses) resulting from the return of surplus assets of any Plan shall be excluded, (f) any non-recurring tax benefits resulting from the transactions contemplated by the Transaction Documents shall be excluded and (g) the income of any Restricted Subsidiary of Holdings to the extent that the payment thereof to Borrower or a Subsidiary Guarantor, whether by dividends or similar distributions, intercompany loan repayments or otherwise, is not at the time permitted for any reason other than by operation of any Requirement of Law applicable to that Restricted Subsidiary shall be excluded; provided that, for the avoidance of doubt, the sole fact that such a payment would result in adverse tax consequences for any Company shall not cause such income to be excluded pursuant to this clause (g).

“Consolidated Working Capital” shall mean, Consolidated Current Assets at such date of determination minus Consolidated Current Liabilities at such date of determination; provided that increases or decreases in Consolidated Working Capital shall be calculated without regard to any changes in Consolidated Current Assets or Consolidated Current Liabilities as a result of (a) any reclassification in accordance with GAAP of assets or liabilities, as applicable, between current and noncurrent or (b) the effects of purchase accounting.

“Contingent Obligation” shall mean, as to any person, any obligation, agreement, understanding or arrangement of such person guaranteeing or intended to guarantee any Indebtedness

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(“primary obligations”) of any other person (the “primary obligor”) in any manner, whether directly or indirectly, including any obligation of such person, whether or not contingent, (a) to purchase any such primary obligation or any property constituting direct or indirect security therefor; (b) to advance or supply funds (i) for the purchase or payment of any such primary obligation or (ii) to maintain working capital or equity capital of the primary obligor or otherwise to maintain the net worth or solvency of the primary obligor; (c) to purchase property, securities or services primarily for the purpose of assuring the owner of any such primary obligation of the ability of the primary obligor to make payment of such primary obligation; (d) with respect to bankers’ acceptances, letters of credit and similar credit arrangements, until a reimbursement obligation arises (which reimbursement obligation shall constitute Indebtedness); or (e) otherwise to assure or hold harmless the holder of such primary obligation against loss in respect thereof; provided, however, that the term “Contingent Obligation” shall not include endorsements of instruments for deposit or collection in the ordinary course of business or any product warranties.  The amount of any Contingent Obligation shall be deemed to be an amount equal to the stated or determinable amount of the primary obligation in respect of which such Contingent Obligation is made (or, if less, the maximum amount of such primary obligation for which such person may be liable, whether singly or jointly, pursuant to the terms of the instrument evidencing such Contingent Obligation) or, if not stated or determinable, the maximum reasonably anticipated liability in respect thereof (assuming such person is required to perform thereunder) as determined by such person in good faith.

“Control” shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a person, whether through the ownership of voting securities, by contract or otherwise, and the terms “Controlling” and “Controlled” shall have meanings correlative thereto.

“Controlled Investment Affiliate” shall mean, as to any person, any other person which directly or indirectly is in Control of, is Controlled by, or is under common Control with, such person and is organized by such person (or any person Controlling such person) primarily for making equity or debt investments in Holdings or other portfolio companies.

“Cost Savings Certificate” shall have the meaning assigned to such term in the definition of “Pro Forma Cost Savings”.

“Credit Extension” shall mean, as the context may require, (i) the making of a Loan by a Lender or (ii) the issuance of any Letter of Credit, or the amendment, extension or renewal of any existing Letter of Credit, by the Issuing Bank.

“Cumulative Retained ECF Amount” shall mean, at any date, an amount, not less than zero, determined on a cumulative basis equal to the amount of Excess Cash Flow for all Excess Cash Flow Periods that was not (and, in the case of any period where the respective required date of prepayment has not yet occurred pursuant to Section 2.10(f), will not on such date of required prepayment be) required to be applied in accordance with Section 2.10(f).

“Debt Issuance” shall mean the incurrence by Holdings or any of its Restricted Subsidiaries of any Indebtedness after the Closing Date (other than as permitted by Section 6.01).

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“Default” shall mean any event, occurrence or condition which is, or upon notice, lapse of time or both would constitute, an Event of Default.

“Default Rate” shall have the meaning assigned to such term in Section 2.06(c).

“Defaulting Lender” shall mean any Lender that (a) has failed to fund any portion of its Loans or participations in Letters of Credit or Swingline Loans required to be funded by it hereunder within one Business Day of the date required to be funded by it hereunder, (b) has notified the Administrative Agent, the Issuing Bank, the Swingline Lender, any Lender and/or Borrower in writing that it does not intend to comply with any of its funding obligations under this Agreement or has made a public statement to the effect that it does not intend to comply with its funding obligations under this Agreement or, in the case of a Lender that has a Commitment, LC Exposure or Swingline Exposure outstanding at such time,  under other agreements in which it commits to extend credit generally, (c) has failed, within three Business Days after request by the Administrative Agent, to confirm that it will comply with the terms of this Agreement relating to its obligations to fund prospective Loans and participations in then outstanding Letters of Credit and Swingline Loans, (d) has otherwise failed to pay over to the Administrative Agent or any other Lender any other amount required to be paid by it hereunder within three Business Days of the date when due, unless the subject of a good faith dispute, or (e) in the case of a Lender that has a Commitment, LC Exposure or Swingline Exposure outstanding at such time, shall take, or is the Subsidiary of any person that has taken, any action or be (or is) the subject of any action or proceeding of a type described in Section 8.01(g) or (h) (or any comparable proceeding initiated by a regulatory authority having jurisdiction over such Lender or such person).

“Disclosure Letter” means a letter dated the date hereof from Borrower that is designated as such.

“Disqualified Capital Stock” shall mean any Equity Interest which, by its terms (or by the terms of any security into which it is convertible or for which it is exchangeable), or upon the happening of any event, (a) matures (excluding any maturity as the result of an optional redemption by the issuer thereof) or is mandatorily redeemable, pursuant to a sinking fund obligation or otherwise, or is redeemable at the option of the holder thereof, in whole or in part, on or prior to the first anniversary of the Final Maturity Date (as of the date of the issuance of such Disqualified Capital Stock), (b) is convertible into or exchangeable (unless at the sole option of the issuer thereof) for (i) debt securities or (ii) any Equity Interests referred to in (a) above, in each case at any time on or prior to the first anniversary of the Final Maturity Date (as of the date of the issuance of such Disqualified Capital Stock), or (c) contains any repurchase obligation which may come into effect prior to payment in full of all Obligations; provided, however, that any Equity Interests that would not constitute Disqualified Capital Stock but for provisions thereof giving holders thereof (or the holders of any security into or for which such Equity Interests is convertible, exchangeable or exercisable) the right to require the issuer thereof to redeem such Equity Interests upon the occurrence of a change in control or an asset sale occurring prior to the first anniversary of the Final Maturity Date shall not constitute Disqualified Capital Stock if such Equity Interests provide that the issuer thereof will not redeem any such Equity Interests pursuant to such provisions prior to the repayment in full of the Obligations and the Senior Notes.

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“Disqualified Institution” shall mean any Competitor of Borrower and its Restricted Subsidiaries identified by Borrower to the Administrative Agent prior to the date hereof or from time to time thereafter; provided that any such Person identified on or after the date hereof and prior to the completion of the primary syndication of the Commitments and Loans (as determined by the Arranger) shall be acceptable to the Administrative Agent in its reasonable discretion.

“Dividend” with respect to any person shall mean that such person has declared or paid a dividend or returned any equity capital to the holders of its Equity Interests or authorized or made any other distribution, payment or delivery of property (other than Qualified Capital Stock of such person) or cash to the holders of its Equity Interests as such, or redeemed, retired, purchased or otherwise acquired, directly or indirectly, for consideration any of its or any of its parent companies’ Equity Interests outstanding (or any options or warrants issued by such person or any of its parent companies with respect to its Equity Interests), or set aside any funds for any of the foregoing purposes, or shall have permitted any of its Subsidiaries to purchase or otherwise acquire for consideration any of the Equity Interests of such person or any of its parent companies outstanding (or any options or warrants issued by such person or any of its parent companies with respect to its Equity Interests).

“dollars” or “$” shall mean lawful money of the United States.

“Domestic Subsidiary” shall mean any Restricted Subsidiary that is organized or existing under the laws of the United States, any state thereof or the District of Columbia.

“Eligible Assignee” shall mean any person to whom it is permitted to assign Loans and Commitments pursuant to Section 10.04(b)(i); provided that “Eligible Assignee” shall not include Borrower or any of its Affiliates or Subsidiaries (other than Affiliated Lender) or any natural person.

“Embargoed Person” shall mean any party that (i) is publicly identified on the most current list of “Specially Designated Nationals and Blocked Persons” published by the U.S. Treasury Department’s Office of Foreign Assets Control (“OFAC”), is a “designated national” pursuant to OFAC’s Cuban Assets Control Regulations (31 C.F.R. 515.305), or resides, is organized or chartered, or has a place of business in a country or territory that is prohibited pursuant to the OFAC sanctions programs or (ii) is publicly identified as prohibited from doing business with the United States under the International Emergency Economic Powers Act, the Trading With the Enemy Act, or any other Requirement of Law.

“Environment” shall mean ambient air, indoor air, surface water and groundwater (including potable water, navigable water and wetlands), the land surface or subsurface strata, natural resources, the workplace or as otherwise defined in any Environmental Law.

“Environmental Claim” shall mean any written claim, notice, demand, order, action, suit, proceeding or other communication alleging liability for or obligation with respect to any investigation, remediation, removal, cleanup, response, corrective action, damages to natural resources, personal injury, property damage, fines, penalties or other costs resulting from, related to or arising out of (i) the presence, Release or threatened Release in or into the Environment of

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Hazardous Material at any location or (ii) any violation or alleged violation of any Environmental Law, and shall include any claim seeking damages, contribution, indemnification, cost recovery, compensation or injunctive relief resulting from, related to or arising out of the presence, Release or threatened Release of Hazardous Material or alleged injury or threat of injury to health, safety or the Environment.

“Environmental Law” shall mean any and all applicable treaties, laws, statutes, common law, ordinances, regulations, rules, decrees, orders, judgments, consent orders, consent decrees, code or other binding requirements of a Governmental Authority, relating to protection of public health or the Environment, the Release or threatened Release of Hazardous Material, natural resources or natural resource damages, or workplace safety or health as related to exposure to Hazardous Material, and any and all Environmental Permits.

“Environmental Permit” shall mean any permit, license, approval, registration, notification, exemption, consent or other authorization required by or from a Governmental Authority under Environmental Law.

“Equity Financing” shall mean the cash common equity investment in CPI International Holding LLC, a Delaware limited liability company, together with rollover equity in the Acquired Business that is converted into interests in CPI International Holding LLC, by the Equity Investors as the same is further invested in cash common equity in Holdings and further invested in cash common equity in Borrower on or prior to the Closing Date, of not less than 32.5% of the pro forma total consolidated capitalization of Holdings and its Subsidiaries (in calculating such capitalization the Stub Notes and $2,500,000 of other Indebtedness shall be excluded) after giving effect to the Transactions.

“Equity Interest” shall mean, with respect to any person, any and all shares, interests, participations or other equivalents, including membership interests (however designated, whether voting or nonvoting), of equity of such person, including, if such person is a partnership, partnership interests (whether general or limited) and any other interest or participation that confers on a person the right to receive a share of the profits and losses of, or distributions of property of, such partnership, whether outstanding on the date hereof or issued after the Closing Date, but excluding debt securities convertible or exchangeable into such equity.

“Equity Investors” shall mean Sponsors, CICPI Holdings LLC, certain directors, officers and employees of the Companies and one or more other investors reasonably satisfactory to the Administrative Agent.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as the same may be amended from time to time.

“ERISA Affiliate” shall mean, with respect to any person, any trade or business (whether or not incorporated) that, together with such person, is treated as a single employer under Section 414 of the Code.

“ERISA Event” shall mean (a) any “reportable event,” as defined in Section 4043 of ERISA or the regulations issued thereunder, with respect to a Plan (other than an event for which the 30-day notice period is waived by regulation); (b) with respect to a Plan, the failure to satisfy

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the minimum funding standard of Section 412 of the Code and Section 302 of ERISA, whether or not waived; (c) the failure to make by its due date a required installment under Section 430(j) of the Code with respect to any Plan or the failure to make any required contribution to a Multiemployer Plan; (d) the filing pursuant to Section 412(c) of the Code or Section 303(d) of ERISA (or after the effective date of the Pension Protection Act of 2006, Section 412(c) of the Code and Section 302(c) of ERISA) of an application for a waiver of the minimum funding standard with respect to any Plan; (e) the incurrence by any Company or any of its ERISA Affiliates of any liability under Title IV of ERISA with respect to the termination of any Plan; (f) the receipt by any Company or any of its ERISA Affiliates from the PBGC or a plan administrator of any notice relating to the intention to terminate any Plan or Plans or to appoint a trustee to administer any Plan or the occurrence of any event or condition which could reasonably be expected to constitute grounds under ERISA for the termination of, or the appointment of a trustee to administer, any Plan; (g) the incurrence by any Company or any of its ERISA Affiliates of any liability with respect to the withdrawal from any Plan or Multiemployer Plan; (h) the receipt by any Company or its ERISA Affiliates of any notice, concerning the imposition of Withdrawal Liability or a determination that a Multiemployer Plan is, or is expected to be, insolvent or in reorganization, within the meaning of Title IV of ERISA; (i) the “substantial cessation of operations” within the meaning of Section 4062(e) of ERISA with respect to a Plan; (j) the making of any amendment to any Plan which could result in the imposition of a lien or the posting of a bond or other security; and (k) the occurrence of a nonexempt prohibited transaction (within the meaning of Section 4975 of the Code or Section 406 of ERISA) which could reasonably be expected to result in liability to any Company.

“Eurodollar Borrowing” shall mean a Borrowing comprised of Eurodollar Loans.

“Eurodollar Loan” shall mean any Eurodollar Revolving Loan or Eurodollar Term Loan.

“Eurodollar Revolving Borrowing” shall mean a Borrowing comprised of Eurodollar Revolving Loans.

“Eurodollar Revolving Loan” shall mean any Revolving Loan bearing interest at a rate determined by reference to the Adjusted LIBOR Rate in accordance with the provisions of Article II.

“Eurodollar Term Loan” shall mean any Term Loan bearing interest at a rate determined by reference to the Adjusted LIBOR Rate in accordance with the provisions of Article II.

“Event of Default” shall have the meaning assigned to such term in Section 8.01.

“Excess Amount” shall have the meaning assigned to such term in Section 2.10(g).

“Excess Cash Flow” shall mean, for any period, an amount equal to the excess, if any, of:

(a)           the sum, without duplication, of (i) Consolidated Net Income for such period, (ii) an amount equal to the sum of total depreciation expense, total amortization expense and other non-cash charges to the extent reducing Consolidated Net Income, (iii)

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decreases in Consolidated Working Capital for such period and (iv) an amount equal to the aggregate net non-cash loss on any asset sale by Holdings and its Restricted Subsidiaries during such period (other than sales in the ordinary course of business) to the extent deducted in arriving at Consolidated Net Income over

(b)           the sum, without duplication, of the following (but only to the extent not otherwise reducing Consolidated Net Income for such period) (i) an amount equal to the amount of all non-cash income, gains, and credits included in arriving at Consolidated Net Income, (ii) the aggregate amount of Capital Expenditures and acquisitions of intellectual property, in each case to the extent made in cash, except to the extent financed with the proceeds of Indebtedness of Holdings or any of its Restricted Subsidiaries (other than Revolving Loans or Swingline Loans), (iii) the aggregate amount of all principal payments of Indebtedness of Holdings or any of its Restricted Subsidiaries (other than Loans, but including the principal component of payments in respect of Capital Lease Obligations) made during such period, except to the extent financed with the proceeds of Indebtedness of Holdings or any of its Restricted Subsidiaries (other than Revolving Loans) or to the extent such payments are not permitted under this Agreement, (iv) increases in Consolidated Working Capital for such period, (v) except to the extent financed with proceeds of Indebtedness of Holdings or any of its Restricted Subsidiaries (other than Revolving Loans or Swingline Loans), cash payments by Holdings and its Restricted Subsidiaries during such period in respect of long-term liabilities of Holdings and such Restricted Subsidiaries (other than Indebtedness), (vi) all cash amounts paid by Holdings and its Restricted Subsidiaries during such period in connection with all Permitted Acquisitions and all Investments pursuant to Section 6.04(d), (e), (k), (r) or (s) (except to the extent invested into a Restricted Subsidiary), to the extent not financed with the proceeds of Indebtedness of Holdings or its Restricted Subsidiaries (other than Revolving Loans), (vii) cash payments actually paid under earnout and contingent obligations incurred in connection with Permitted Acquisitions and Investments made pursuant to Section 6.04(k), (r) or (s) (except to the extent invested into a Restricted Subsidiary), to the extent not financed with the proceeds of Indebtedness of Holdings or any of its Restricted Subsidiaries (other than Revolving Loans), (viii) all amounts paid in cash in respect of covenants not to compete, consulting agreements and other affiliated contracts in connection with Permitted Acquisitions and Investments made pursuant to Section 6.04(k), (r) or (s) (except to the extent invested into a Restricted Subsidiary), to the extent not financed with the proceeds of Indebtedness of Holdings or any of its Restricted Subsidiaries (other than Revolving Loans), (ix) reasonable cash costs, fees and expenses (including premium, make-whole and penalty payments) incurred in connection with the issuance or prepayment of any Indebtedness (including any refinancing), except to the extent such costs, fees and expenses are financed with the proceeds of Indebtedness of Holdings or any of its Restricted Subsidiaries (other than Revolving Loans), (x) reasonable costs, fees and expenses, in each case paid in cash in such period, in each case incurred in connection with the issuance of Equity Interests (including all classes of stock, options to purchase stock and stock appreciation rights to management of a Loan Party), Investments, asset sales or divestitures, in each case as permitted hereunder, (xi) any cash Dividends made to Holdings by any Restricted Subsidiary thereof to the extent permitted under Section 6.07 (other than Section 6.07(d)), (xii) any cash payment by Holdings and its Restricted Subsidiaries to Sponsor and/or other Affiliates (whether directly or through

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Holdings) to the extent permitted under Section 6.08(e), (xiii) cash taxes paid during such period that did not reduce Consolidated Net Income for such period and the amount of the excess of any cash payments (or tax reserves set aside or payable) in respect of taxes by Holdings and its Restricted Subsidiaries over the tax expense already deducted from Consolidated Net Income, (xiv) repurchases of Equity Interests permitted by Section 6.07(b), to the extent funded with cash of the Holdings and its Restricted Subsidiaries, (xv) to the extent paid in cash during such period, Transaction Costs, (xvi) the net decrease during such fiscal year (if any) in deferred tax accounts of Holdings and its Restricted Subsidiaries, (xvii) cash payments by Holdings and its Restricted Subsidiaries during such period in respect of long-term liabilities (including cash pension payments and other cash payments in respect of retirement plans) (in each case, to the extent required to be made) of Holdings and its Restricted Subsidiaries other than Indebtedness, (xviii) cash payments made during such period in respect of non-cash charges that increased Excess Cash Flow in any prior fiscal year, (xix) cash payments made during such fiscal year in respect of employee retention payments in connection with a Subject Transaction, and (xx) the income of any Restricted Subsidiary (foreign or domestic) of Holdings (other than Borrower) to the extent that the payment of such income to the Loan Parties, whether by dividends or similar distributions, intercompany loan repayments or otherwise (1) is not at the time of calculation permitted by operation of any Requirements of Law applicable to that Restricted Subsidiary or (2) would at the time of calculation result in material adverse tax consequences for any Company; provided, however, that to the extent such prohibition in clause (xx)(1) or material adverse tax consequence in clause (xx)(2) does not exist at the time of any future calculation, any amounts deducted from Excess Cash Flow pursuant to clause (xx)(1) or (xx)(2), as applicable, which have not already been added to Excess Cash Flow pursuant to this proviso, shall be added to Excess Cash Flow at the time of such future calculation; provided further that such Restricted Subsidiary’s income should not be deducted from Excess Cash Flow by operation of this clause (xx) to the extent such income was actually received in cash by Borrower or a Subsidiary Guarantor during such period and (xxi) without duplication of amounts deducted from Excess Cash Flow in prior periods, the aggregate consideration required to be paid in cash by Borrower or its Restricted Subsidiaries pursuant to binding contracts (the “Contract Consideration”) entered into prior to or during such period relating to Permitted Acquisitions, Capital Expenditures or acquisitions of Intellectual Property to be consummated or made during the 90 days following such period to the extent intended to be financed with internally generated cash flow of Borrower and its Restricted Subsidiaries; provided that to the extent the aggregate amount of internally generated cash flow utilized to finance such Permitted Acquisitions, Capital Expenditures or acquisitions of Intellectual Property during such 90 days is less than the Contract Consideration, the amount of such shortfall shall be added to the calculation of Excess Cash Flow for the next Excess Cash Flow Period.

“Excess Cash Flow Period” shall mean each fiscal year of Holdings, beginning with the fiscal year of Holdings starting on or about October 1, 2011.

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

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“Excluded Subsidiary” shall mean (a) a Foreign Subsidiary, (b) a CFC Holdco, (c) a Domestic Subsidiary that is a Subsidiary of a CFC, (d) an Immaterial Subsidiary or (e) an Unrestricted Subsidiary.

“Excluded Taxes” shall mean, with respect to the Administrative Agent, any Lender, the Issuing Bank or any other recipient of any payment to be made by or on account of any obligation of any Loan Party hereunder or under any other Loan Document, (a) taxes imposed on or measured by its overall net income or profits and franchise taxes imposed on it (in lieu of net income taxes), however denominated (and including, for the avoidance of doubt, any backup withholding in respect thereof under Section 3406 of the Code), by a jurisdiction (i) as a result of the recipient being organized or having its principal office or, in the case of any Lender, its applicable lending office in such jurisdiction, or (ii) as a result of any other present or former connection between such recipient and such jurisdiction (other than a connection arising primarily from entering into, being a party to, receiving any payment under, enforcing its rights under or entering into any other transactions pursuant to this Agreement or any other Loan Document), (b) in the case of a Foreign Lender (other than an assignee pursuant to a request by Borrower under Section 2.16), any U.S. federal withholding tax that is imposed on interest payments pursuant to any Requirements of Law that are in effect at the time such Foreign Lender becomes a party hereto, except to the extent that such Foreign Lender’s assignor, if any, was entitled, immediately prior to such assignment, to receive additional amounts or indemnity payments from a Loan Party with respect to such withholding tax pursuant to Section 2.15; provided that this subclause (b) shall not apply to any tax imposed on a Lender in connection with an interest or participation in any Loan or other obligation that such Lender was required to acquire pursuant to Section 2.14(d), (c) in the case of a Foreign Lender who designates a new lending office, any U.S. federal withholding tax that is imposed on interest payments pursuant to any Requirements of Law that are in effect at the time of such change in lending office, except to the extent that such Foreign Lender was entitled, immediately prior to such change in lending office, to receive additional amounts or indemnity payments from a Loan Party with respect to such withholding tax pursuant to Section 2.15, (d) any withholding tax that is attributable to such Lender’s failure to comply with Section 2.15(e) or (e) any U.S. federal withholding Taxes imposed on any “withholdable payment” payable to such recipient as a result of the failure of such recipient to satisfy the applicable requirements as set forth in FATCA.

“Existing Letters of Credit” shall mean the Letters of Credit listed on Schedule 1.01(c).

“Existing Lien” shall have the meaning assigned to such term in Section 6.02(c).

“Extended Revolving Loans” shall have the meaning assigned to such term in Section 10.02(b)(viii)(B).

“Extended Term Loans” shall have the meaning assigned to such term in Section 10.02(b)(viii)(B).

“FATCA” shall mean current Sections 1471 through 1474 of the Code and any amended or successor version that is substantially comparable, and any regulations and official interpretations thereof.

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“FCPA” shall mean the Foreign Corrupt Practices Act of 1977, as amended, and the rules and regulations thereunder.

“Federal Funds Effective Rate” shall mean, for any day, the weighted average of the rates on overnight federal funds transactions with members of the Federal Reserve System of the United States arranged by federal funds brokers, as published on the next succeeding Business Day by the Federal Reserve Bank of New York, or, if such rate is not so published for any day that is a Business Day, the average of the quotations for the day for such transactions received by the Administrative Agent from three federal funds brokers of recognized standing selected by it.

“Fee Letter” shall mean the confidential fee letter, dated as of November 24, 2010, among Borrower, the Arranger and the Administrative Agent, and any other fee letters entered into from time to time related to the Loan Documents.

“Fees” shall mean the Commitment Fees, the Administrative Agent Fees, the LC Participation Fees and the Fronting Fees.

“Final Maturity Date” shall mean the latest of the Revolving Maturity Date, the Term B Loan Maturity Date and any Incremental Term Loan Maturity Date applicable to existing Incremental Term Loans, as of any date of determination.

“Financial Officer” of any person shall mean the chief financial officer, principal accounting officer, treasurer or controller of such person.

“FIRREA” shall mean the Financial Institutions Reform, Recovery and Enforcement Act of 1989, as amended.

“Foreign Lender”shall mean any Lender that is not, for United States federal income tax purposes, (i) an individual who is a citizen or resident of the United States, (ii) a corporation, partnership or other entity treated as a corporation or partnership created or organized in or under the laws of the United States, any state thereof or the District of Columbia, (iii) an estate whose income is subject to U.S. federal income taxation regardless of its source or (iv) a trust if a court within the United States is able to exercise primary supervision over the administration of such trust and one or more United States persons have the authority to control all substantial decisions of such trust, or such trust has validly elected to be treated as a domestic trust.  In addition, solely for purposes of clauses (b) and (c) of the definition of Excluded Taxes, a Foreign Lender shall include a partnership or other entity treated as a partnership created or organized in or under the laws of the United States, any state thereof or the District of Columbia, but only to the extent the partners of such partnership (including indirect partners if the direct partners are partnerships or other entities treated as partnerships for U.S. federal income tax purposes created or organized in or under the laws of the United States, any state thereof or the District of Columbia) are treated as Foreign Lenders under the preceding sentence (in which event, the determination of whether a U.S. federal withholding tax on interest payments was imposed pursuant to any Requirements of Law in effect at the time such Foreign Lender became a party hereto will be made by reference to the time when the applicable direct or indirect partner became a direct or indirect partner of such Foreign Lender, but only if such date is later than the date on which such Foreign Lender became a party hereto).

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“Foreign Plan” shall mean any employee benefit plan, program, policy, arrangement or agreement maintained or contributed to by any Company with respect to employees employed outside the United States.

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

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

“Fronting Fee” shall have the meaning assigned to such term in Section 2.05(c).

“Fund” shall mean any person that is (or will be) engaged in making, purchasing, holding or otherwise investing in commercial loans and similar extensions of credit in the ordinary course of its business.

“Funding Guarantor” shall have the meaning assigned to such term in Section 7.10.

“Funding Indemnity Agreement” shall mean the funding indemnity letter agreement, dated as of the Closing Date, between Borrower and UBS AG, Stamford Branch.

“GAAP” shall mean generally accepted accounting principles in the United States applied on a consistent basis.

“Governmental Authority” shall mean the government of the United States or any other nation, or of any political subdivision thereof, whether state, provincial or local, and any agency, authority, instrumentality, regulatory body, court, central bank or other entity exercising executive, legislative, judicial, taxing, regulatory or administrative powers or functions of or pertaining to government (including any supra-national bodies such as the European Union, the European Central Bank or the Organisation for Economic Co-operation and Development).

“Governmental Real Property Disclosure Requirements” shall mean any Requirement of Law of any Governmental Authority requiring notification of the buyer, lessee, mortgagee, assignee or other transferee of any Real Property, facility, establishment or business, or notification, registration or filing to or with any Governmental Authority, in connection with the sale, lease, mortgage, assignment or other transfer (including any transfer of control) of any Real Property, facility, establishment or business, of the actual or threatened presence or Release in or into the Environment, or the use, disposal or handling of Hazardous Material on, at, under or near the Real Property, facility, establishment or business to be sold, leased, mortgaged, assigned or transferred.

“Guaranteed Obligations” shall have the meaning assigned to such term in Section 7.01.

“Guarantees” shall mean the guarantees issued pursuant to Article VII by Holdings and the Subsidiary Guarantors.

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“Guarantor Obligations” shall have the meaning assigned to such term in Section 7.08(a).

“Guarantors” shall mean Holdings and the Subsidiary Guarantors.

“Hazardous Materials” shall mean the following:  hazardous substances; hazardous wastes; polychlorinated biphenyls (“PCBs”) or any substance or compound containing PCBs; asbestos or any asbestos-containing materials in any form or condition; radon or any other radioactive materials including any source, special nuclear or by-product material; petroleum, crude oil or any fraction thereof; and any other pollutant or contaminant or chemicals, wastes, materials, compounds, constituents or substances, subject to regulation pursuant to any Environmental Law.

“Hedging Agreement” shall mean any swap, cap, collar, forward purchase or similar agreements or arrangements dealing with interest rates, currency exchange rates or commodity prices, either generally or under specific contingencies.

“Hedging Obligations” shall mean obligations under or with respect to Hedging Agreements.

“Holdings” shall have the meaning assigned to such term in the preamble hereto.

“Immaterial Subsidiary” shall mean any Restricted Subsidiary of Holdings (other than Borrower), which, together with its own Restricted Subsidiaries, as consolidated in the consolidated financial statements of Holdings, accounts for (i) less than 1.0% of the consolidated assets of Holdings and its Restricted Subsidiaries as of the last day of the most recently ended fiscal quarter of Holdings and its Restricted Subsidiaries for which financial information is available and (ii) less than 1.0% of Consolidated EBITDA for the most recently ended period of four consecutive fiscal quarters of Holdings; provided that (x) all Immaterial Subsidiaries shall not, in the aggregate, account for more than 3.0% of the consolidated assets of Holdings as of such most recently ended fiscal quarter or for more than 3.0% of the Consolidated EBITDA of Holdings and its Restricted Subsidiaries for such most recently ended period of four consecutive fiscal quarters and (y) no Subsidiary that is an obligator under the Senior Notes (or any refinancing thereof) shall be an Immaterial Subsidiary.

“Increase Effective Date” shall have the meaning assigned to such term in Section 2.20(a).

“Increase Joinder” shall have the meaning assigned to such term in Section 2.20(c).

“Incremental Revolving Commitment” shall have the meaning assigned to such term in Section 2.20(a).

“Incremental Revolving Loan” shall have the meaning assigned to such term in Section 2.20(a).

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“Incremental Revolving Loan Lender” shall mean a Lender with an Incremental Revolving Loan Commitment or an outstanding Incremental Revolving Loan.

“Incremental Term Loan” shall have the meaning assigned to such term in Section 2.20(c)(i).  Each Incremental Term Loan shall be either an ABR Term Loan or a Eurodollar Term Loan.

“Incremental Term Loan Commitment” shall have the meaning assigned to such term in Section 2.20(a).

“Incremental Term Loan Lender” shall mean a Lender with an Incremental Term Loan Commitment or an outstanding Incremental Term Loan.

“Incremental Term Loan Maturity Date” shall have the meaning assigned to such term in Section 2.20(c)(iii).

“Indebtedness” of any person shall mean, without duplication: (a) all obligations of such person for borrowed money; (b) all obligations of such person evidenced by bonds, debentures, notes or similar instruments; (c) all obligations of such person under conditional sale or other title retention agreements relating to property purchased by such person; (d) all obligations of such person issued or assumed as the deferred purchase price of property or services (excluding (i) trade accounts payable and accrued obligations incurred in the ordinary course of business on normal trade terms and (ii) earnouts, escrows, holdbacks and similar deferred payment obligations so long as they are contingent or not yet fixed); (e) all Indebtedness of others secured by any Lien on property owned or acquired by such person, whether or not the obligations secured thereby have been assumed, but limited to the fair market value of such property; (f) all Capital Lease Obligations, Purchase Money Obligations and synthetic lease obligations of such person; (g) all Hedging Obligations to the extent required to be reflected on a balance sheet of such person; (h) all Attributable Indebtedness of such person; (i) all obligations of such person for the reimbursement of any obligor in respect of letters of credit, letters of guaranty, bankers’ acceptances and similar credit transactions; and (j) all Contingent Obligations of such person in respect of Indebtedness or obligations of others of the kinds referred to in clauses (a) through (i) above.  The Indebtedness of any person shall include the Indebtedness of any other entity (including any partnership in which such person is a general partner) to the extent such person is liable therefor as a result of such person’s ownership interest in or other relationship with such entity, except (other than in the case of general partner liability) to the extent that terms of such Indebtedness expressly provide that such person is not liable therefor.

“Indemnified Taxes” shall mean all Taxes other than Excluded Taxes and Other Taxes.

“Indemnitee” shall have the meaning assigned to such term in Section 10.03(b).

“Information” shall have the meaning assigned to such term in Section 10.12.

“Insurance Policies” shall mean the insurance policies and coverages required to be maintained by each Loan Party which is an owner of Mortgaged Property with respect to the applicable Mortgaged Property pursuant to Section 5.04 and all renewals and extensions thereof.

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“Insurance Requirements” shall mean, collectively, all provisions of the Insurance Policies, all requirements of the issuer of any of the Insurance Policies and all orders, rules, regulations and any other requirements of the National Board of Fire Underwriters (or any other body exercising similar functions) binding upon each Loan Party which is an owner of Mortgaged Property and applicable to the Mortgaged Property or any use or condition thereof.

“Intellectual Property” shall have the meaning assigned to such term in Section 3.06(a).

“Intercompany Subordination Agreement” shall mean the intercompany subordination agreement substantially in the form of Exhibit P.

“Interest Election Request” shall mean a request by Borrower to convert or continue a Revolving Borrowing or Term Borrowing in accordance with Section 2.08(b), substantially in the form of Exhibit E.

“Interest Payment Date” shall mean (a) with respect to any ABR Loan (including Swingline Loans), the last Business Day of each March, June, September and December to occur during any period in which such Loan is outstanding, (b) with respect to any Eurodollar Loan, the last day of the Interest Period applicable to the Borrowing of which such Loan is a part and, in the case of a Eurodollar Loan with an Interest Period of more than three months’ duration, each day prior to the last day of such Interest Period that occurs at intervals of three months’ duration after the first day of such Interest Period, (c) with respect to any Revolving Loan or Swingline Loan, the Revolving Maturity Date or such earlier date on which the Revolving Commitments are terminated and (d) with respect to any Term Loan, the Term B Loan Maturity Date or an Incremental Term Loan Maturity Date, as the case may be.

“Interest Period” shall mean, with respect to any Eurodollar Borrowing, the period commencing on the date of such Borrowing and ending on the numerically corresponding day in the calendar month that is one, two, three or six months (or nine or twelve months if agreed to by all affected Lenders) thereafter, as Borrower may elect; provided that (a) if any Interest Period would end on a day other than a Business Day, such Interest Period shall be extended to the next succeeding Business Day unless such next succeeding Business Day would fall in the next calendar month, in which case such Interest Period shall end on the next preceding Business Day, and (b) any Interest Period that commences on the last Business Day of a calendar month (or on a day for which there is no numerically corresponding day in the last calendar month of such Interest Period) shall end on the last Business Day of the last calendar month of such Interest Period.  For purposes hereof, the date of a Borrowing initially shall be the date on which such Borrowing is made and thereafter shall be the effective date of the most recent conversion or continuation of such Borrowing; provided, however, that an Interest Period shall be limited to the extent required under Section 2.03(e).

“Investments” shall have the meaning assigned to such term in Section 6.04.  For purposes of covenant compliance with respect to Investments in persons other than Borrower or a Subsidiary Guarantor, the amount of any Investment shall be the amount actually invested, without adjustment for subsequent increases or decreases in the value of such Investment; provided that the amount of any Investment in a person that is not Borrower or a Subsidiary Guarantor

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shall be deemed to be reduced by any cash returns on such Investment to Borrower or a Subsidiary Guarantor.

“IP Filing Collateral” shall mean Collateral consisting solely of Intellectual Property for which a security interest can be perfected by filing a UCC financing statement or filing with the United States Patent and Trademark Office or Copyright Office.

“IPO” shall mean the first underwritten public offering by Holdings or a parent entity of Holdings of its Equity Interests consisting of Voting Stock after the Closing Date pursuant to a registration statement filed with the Securities and Exchange Commission in accordance with the Securities Act.

“Issuing Bank” shall mean, as the context may require, (a) UBS AG, Stamford Branch, in its capacity as issuer of Letters of Credit issued by it; (b) any other Lender that may become an Issuing Bank pursuant to Sections 2.18(j) and (k) in its capacity as issuer of Letters of Credit issued by such Lender; or (c) collectively, all of the foregoing.

“Joinder Agreement” shall mean a joinder agreement substantially in the form of Exhibit F.

“JV Guarantor” shall mean a JV Subsidiary that is a Guarantor.

“JV Subsidiary” shall mean, any Restricted Subsidiary of any Company which is not a Wholly Owned Subsidiary and the business and management thereof is jointly controlled by the holders of the Equity Interests therein pursuant to customary joint venture arrangements, provided that such Subsidiary does not have and is not liable in respect of any Indebtedness other than Non-Recourse Debt of such JV Subsidiary and, only if such joint venture is a Guarantor, the Obligations and the obligations under the Senior Note Documents.

“Laws” shall have the meaning assigned to such term in Section 5.15(a).

“LC Commitment” shall mean the commitment of the Issuing Bank to issue Letters of Credit pursuant to Section 2.18.  The amount of the LC Commitment shall initially be $15,000,000, as the same may be increased by the mutual written agreement of Borrower, the Administrative Agent and the Issuing Bank, but in no event exceed the Revolving Commitment.

“LC Disbursement” shall mean a payment or disbursement made by the Issuing Bank pursuant to a drawing under a Letter of Credit.

“LC Exposure” shall mean at any time the sum of (a) the aggregate undrawn amount of all outstanding Letters of Credit at such time plus (b) the aggregate principal amount of all Reimbursement Obligations outstanding at such time.  The LC Exposure of any Revolving Lender at any time shall mean its Pro Rata Percentage of the aggregate LC Exposure at such time.

“LC Participation Fee” shall have the meaning assigned to such term in Section 2.05(c).

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“LC Request” shall mean a request by Borrower in accordance with the terms of Section 2.18(b) and substantially in the form of Exhibit H, or such other form as shall be approved reasonably by the Administrative Agent.

“Leases” shall mean any and all leases, subleases, tenancies, options, concession agreements, rental agreements, occupancy agreements, access agreements and any other agreements (including all amendments, extensions, replacements, renewals, modifications and/or guarantees thereof), whether or not of record and whether now in existence or hereafter entered into, affecting the use or occupancy of all or any portion of any Real Property.

“Lender Addendum” shall mean with respect to any Lender on the Closing Date, a lender addendum in the form of Exhibit I, to be executed and delivered by such Lender on the Closing Date as provided in Section 10.15.

“Lenders” shall mean (a) the persons (other than a natural person) that have become a party hereto pursuant to a Lender Addendum and (b) any person (other than a natural person) that has become a party hereto pursuant to an Assignment and Assumption, other than, in each case, any such Person that has ceased to be a party hereto pursuant to an Assignment and Assumption.  Unless the context clearly indicates otherwise, the term “Lenders” shall include the Swingline Lender.

“Letter of Credit” shall mean any (i) Standby Letter of Credit and (ii) Commercial Letter of Credit, in each case, issued or to be issued by an Issuing Bank for the account of Borrower pursuant to Section 2.18.

“Letter of Credit Expiration Date” shall mean the date which is five Business Days prior to the Revolving Maturity Date.

“LIBOR Rate” shall mean, with respect to any Eurodollar Borrowing for any Interest Period, the rate per annum determined by the Administrative Agent to be the arithmetic mean of the offered rates for deposits in dollars with a term comparable to such Interest Period that appears on the Telerate British Bankers Assoc. Interest Settlement Rates Page (as defined below) at approximately 11:00 a.m., London, England time, on the second full London Business Day preceding the first day of such Interest Period; provided, however, that (i) if no comparable term for an Interest Period is available, the LIBOR Rate shall be determined using the weighted average of the offered rates for the two terms most nearly corresponding to such Interest Period and (ii) if there shall at any time no longer exist a Telerate British Bankers Assoc. Interest Settlement Rates Page, “LIBOR Rate” shall mean, with respect to each day during each Interest Period pertaining to Eurodollar Borrowings comprising part of the same Borrowing, the rate per annum equal to the rate at which the Administrative Agent is offered deposits in dollars at approximately 11:00 a.m., London, England time, two London Business Days prior to the first day of such Interest Period in the London interbank market for delivery on the first day of such Interest Period for the number of days comprised therein and in an amount comparable to its portion of the amount of such Eurodollar Borrowing to be outstanding during such Interest Period.  Notwithstanding the foregoing, for purposes of clause (c) of the definition of Alternate Base Rate, the rates referred to above shall be the rates as of 11:00 a.m., London, England time, on the date of determination (rather than the second London Business Day preceding the date of determination).  “Telerate

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British Bankers Assoc. Interest Settlement Rates Page” shall mean the display designated as Reuters Screen LIBOR01 Page (or such other page as may replace such page on such service for the purpose of displaying the rates at which dollar deposits are offered by leading banks in the London interbank deposit market).

“Lien” shall mean, with respect to any property, (a) any mortgage, deed of trust, lien, pledge, claim, charge, collateral assignment, hypothecation, security interest or encumbrance of any kind or any arrangement to provide priority or preference, including any easement, right-of-way or other encumbrance on title to Real Property, in each of the foregoing cases whether voluntary or imposed by law, and any agreement to give any of the foregoing; and (b) the interest of a vendor or a lessor under any conditional sale agreement, capital lease or title retention agreement (or any financing lease having substantially the same economic effect as any of the foregoing) relating to such property.

“Loan Documents” shall mean this Agreement, the Letters of Credit, the Intercompany Subordination Agreement, the Notes (if any), the Disclosure Letter and the Security Documents and, solely for purposes of Section 8.01(e), the Fee Letter and the Funding Indemnity Agreement.

“Loan Parties” shall mean Holdings, Borrower and the Subsidiary Guarantors.

“Loans” shall mean, as the context may require, a Revolving Loan, a Term Loan or a Swingline Loan (and shall include any Loans contemplated by Section 2.20).

“London Business Day” shall mean any day on which banks are generally open for dealings in dollar deposits in the London interbank market.

“Margin Stock” shall have the meaning assigned to such term in Regulation U.

“Market Disruption Loans” shall mean Loans the rate of interest applicable to which is based upon the Market Disruption Rate, and such Loans shall for all purposes hereunder and under the other Loan Documents be treated as ABR Loans, including for purposes of determining the Applicable Margin with respect thereto.

“Market Disruption Rate” shall mean, for any day, a fluctuating rate per annum (rounded upwards, if necessary, to the nearest 1/100th of 1%) equal to the Alternate Base Rate for such day.  Any change in the Market Disruption Rate shall be effective as of the opening of business on the effective day of any change in the Alternate Base Rate.

“Material Adverse Effect” shall mean (a) a material adverse effect on the business, property, results of operations, financial condition or material agreements of Holdings and its Restricted Subsidiaries, taken as a whole; (b) a material impairment of the ability of the Loan Parties to fully and timely perform any of their material obligations under any Loan Document; or (c) a material impairment of the rights of or benefits or remedies available to the Lenders or the Collateral Agent under any Loan Document.

“Material Subsidiary” shall mean any Restricted Subsidiary of Holdings that is not an Immaterial Subsidiary.

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“Maximum Available Net Assets” shall have the meaning assigned to such term in Section 7.10.

“Maximum Rate” shall have the meaning assigned to such term in Section 10.14.

“Merger” shall have the meaning assigned to such term in the first recital hereto.

“Merger Agreement” shall have the meaning assigned to such term in the first recital hereto.

“Merger Agreement Representations” shall have the meaning assigned to such term in Section 4.01(q).

“Merger Documents” shall mean the collective reference to the Merger Agreement and the other documents listed on Schedule 3.21.

“Merger Sub” shall have the meaning assigned to such term in the preamble hereto.

“MNPI” shall have the meaning assigned to such term in Section 10.01(d).

“Moody’s” shall mean Moody’s Investor Service, Inc.

“Mortgage” shall mean an agreement, including, but not limited to, a mortgage, deed of trust or any other document, creating and evidencing a Lien on a Mortgaged Property, which shall be substantially in the form of Exhibit J or other form reasonably satisfactory to the Collateral Agent, in each case, with such schedules and including such provisions as shall be necessary to conform such document to applicable local or foreign law or as shall be customary under applicable local or foreign law.

“Mortgaged Property” shall mean (a) each Real Property identified as a Mortgaged Property on Schedule 7(a) to the Perfection Certificate dated the Closing Date and (b) each owned Real Property, if any, which shall be subject to a Mortgage delivered after the Closing Date pursuant to Section 5.11(d).

“Multiemployer Plan” shall mean a multiemployer plan within the meaning of Section 4001(a)(3) or Section 3(37) of ERISA (a) to which any Company or any ERISA Affiliate is then making or accruing an obligation to make contributions; (b) to which any Company or any ERISA Affiliate has within the preceding five plan years made contributions; or (c) with respect to which any Company could incur liability.

“Net Cash Proceeds” shall mean:

(a)           with respect to any Asset Sale (other than any issuance or sale of Equity Interests), the cash proceeds received by Holdings or any of its Restricted Subsidiaries (including cash proceeds subsequently received (as and when received by Holdings or any of its Restricted Subsidiaries) in respect of non-cash consideration initially received) net of (i) selling expenses (including reasonable brokers’ fees or commissions, legal, accounting and other professional and transactional fees, transfer and similar taxes and Borrower’s

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good faith estimate of income taxes actually paid or payable in connection with such sale); (ii) amounts provided as a reserve, in accordance with GAAP, against (x) any liabilities under any indemnification obligations associated with such Asset Sale or (y) any other liabilities retained by Holdings or any of its Restricted Subsidiaries associated with the properties sold in such Asset Sale (provided that, to the extent and at the time any such amounts are released from such reserve, such amounts shall constitute Net Cash Proceeds); (iii) Borrower’s good faith estimate of payments required to be made with respect to unassumed liabilities relating to the properties sold within 180 days of such Asset Sale (provided that, to the extent such cash proceeds are not used to make payments in respect of such unassumed liabilities within 180 days of such Asset Sale, such cash proceeds shall constitute Net Cash Proceeds); and (iv) the principal amount, premium or penalty, if any, interest and other amounts on any Indebtedness for borrowed money which is secured by a Lien on the properties sold in such Asset Sale (so long as such Lien was permitted to encumber such properties under the Loan Documents at the time of such sale) and which is repaid with such proceeds (other than any such Indebtedness assumed by the purchaser of such properties);

(b)           with respect to any Debt Issuance or issuance of Disqualified Capital Stock by Holdings or any of its Restricted Subsidiaries or any other issuance or sale of Equity Interests by Holdings or any of its Restricted Subsidiaries, the cash proceeds thereof, net of customary fees, commissions, costs and other expenses incurred in connection therewith; and

(c)           with respect to any Casualty Event, the cash insurance proceeds, condemnation awards and other compensation received in respect thereof, net of all reasonable costs and expenses incurred in connection with the collection of such proceeds, awards or other compensation in respect of such Casualty Event.

“Non-Guarantor Subsidiary” shall mean each Subsidiary that is not a Subsidiary Guarantor.

“Non-Recourse Debt” shall mean Indebtedness of a JV Subsidiary:  (a) as to which no Company provides any guaranty or credit support of any kind or is directly or indirectly liable (as a guarantor or otherwise), (b) which does not provide any recourse against any of the assets of any Company (other than such JV Subsidiary); and (c) no default with respect thereto would permit upon notice, lapse of time or both, any holder of any Indebtedness of any Company (other than the Loans) of a Company (other than such JV Subsidiary) to declare a default on such other Indebtedness or cause the payment thereof to be accelerated or payable prior to its stated maturity.  For the avoidance of doubt, customary capital contribution requirements under the governing documents of a JV Subsidiary that are entirely independent of any such Indebtedness and relate solely to capital calls in the ordinary course of business of such JV Subsidiary shall not invalidate the status of the Indebtedness of such JV Subsidiary classified as Non-Recourse Debt pursuant to the terms of this definition.

“Notes” shall mean any notes evidencing the Term Loans, Revolving Loans or Swingline Loans issued pursuant to this Agreement, if any, substantially in the form of Exhibit K-1, K-2 or K-3.

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“Obligations” shall mean (a) obligations of Borrower and the other Loan Parties from time to time arising under or in respect of the due and punctual payment of (i) the principal of and premium, if any, and interest (including interest accruing during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding) on the Loans, when and as due, whether at maturity, by acceleration, upon one or more dates set for prepayment or otherwise, (ii) each payment required to be made by Borrower and the other Loan Parties under this Agreement in respect of any Letter of Credit, when and as due, including payments in respect of Reimbursement Obligations, interest thereon and obligations to provide cash collateral and (iii) all other monetary obligations, including fees, costs, expenses and indemnities, whether primary, secondary, direct, contingent, fixed or otherwise (including monetary obligations incurred during the pendency of any bankruptcy, insolvency, receivership or other similar proceeding, regardless of whether allowed or allowable in such proceeding), of Borrower and the other Loan Parties under this Agreement and the other Loan Documents, and (b) the due and punctual performance of all covenants, agreements, obligations and liabilities of Borrower and the other Loan Parties under or pursuant to this Agreement and the other Loan Documents.

“OFAC” shall have the meaning set forth in the definition of “Embargoed Person.”

“Officers’ Certificate” shall mean a certificate executed by the chairman of the Board of Directors (if an officer), the chief executive officer or the president and one of the Financial Officers, each in his or her official (and not individual) capacity.

“OID” shall have the meaning set forth in Section 2.20(c)(iv).

“Organizational Documents” shall mean, with respect to any person, (i) in the case of any corporation, the certificate of incorporation and by-laws (or similar documents) of such person, (ii) in the case of any limited liability company, the certificate of formation and operating agreement (or similar documents) of such person, (iii) in the case of any limited partnership, the certificate of formation and limited partnership agreement (or similar documents) of such person, (iv) in the case of any general partnership, the partnership agreement (or similar document) of such person and (v) in any other case, the functional equivalent of the foregoing.

“Other Taxes” shall mean all present or future stamp or documentary taxes or any other excise, property or similar taxes, charges or levies arising from any payment made hereunder or under any other Loan Document or from the execution, delivery or enforcement of, or otherwise with respect to, this Agreement or any other Loan Document (and any interest, additions to tax or penalties applicable thereto).

“Participant” shall have the meaning assigned to such term in Section 10.04(d).

“Participant Register” shall have the meaning assigned to such term in Section 10.04(d).

“PBGC” shall mean the Pension Benefit Guaranty Corporation referred to and defined in ERISA.

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“Perfection Certificate” shall mean a certificate in the form of Exhibit L-1 or any other form reasonably approved by the Collateral Agent, as the same shall be supplemented from time to time by a Perfection Certificate Supplement or otherwise.

“Perfection Certificate Supplement” shall mean a certificate supplement in the form of Exhibit L-2 or any other form reasonably approved by the Collateral Agent.

“Permitted Acquisition” shall mean any transaction or series of related transactions for the direct and indirect (a) acquisition of all or substantially all of the property of any person, or of any business, division or unit of any person; or (b) acquisition of all or substantially all of the Equity Interests of any person, and otherwise causing such person to become a Restricted Subsidiary (other than a JV Subsidiary); or (c) merger or consolidation or any other combination with any person causing such person to become a Restricted Subsidiary (other than a JV Subsidiary); provided that each of the following conditions shall be met:

(i)            no Event of Default then exists or would result therefrom;

(ii)           after giving effect to such transaction on a Pro Forma Basis, (A) Borrower shall be in compliance with all covenants set forth in Sections 6.09 (a) and (b) as of the last day of the most recent Test Period, and (B) the excess of the aggregate Revolving Commitment as of the date of the consummation of such transaction over the aggregate Revolving Exposure of all Lenders as of the date of and after giving effect to the consummation of such transaction shall equal at least $10,000,000;

(iii)          no Company shall, in connection with any such transaction, assume or remain liable with respect to any Indebtedness of the related seller or the business, person or properties acquired, except to the extent permitted under Section 6.01;

(iv)          the person or business to be acquired shall be, or shall be engaged in, a business of the type that Borrower and the Restricted Subsidiaries are permitted to be engaged in under Section 6.14 and the property acquired in connection with any such transaction shall be made subject to the Lien of the Security Documents in accordance with Section 5.11 and shall be free and clear of any Liens, other than Permitted Collateral Liens in the case of Collateral and Permitted Liens in the case of all other acquired property;

(v)           the Board of Directors of the person to be acquired shall not have indicated publicly its opposition to the consummation of such acquisition (which opposition has not been publicly withdrawn);

(vi)          all transactions in connection therewith shall be consummated in accordance in all material respects with all applicable Requirements of Law;

(vii)         with respect to any transaction involving Acquisition Consideration of more than $20,000,000, unless the Administrative Agent shall otherwise agree, Borrower shall have provided the Administrative Agent and the Lenders with (A) historical financial statements for the last two fiscal years (or, if less, the number of years since formation) of the person or business to be acquired (audited if available) and unaudited financial

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statements thereof for the most recent interim period which are available, (B) reasonably detailed projections for the succeeding five years pertaining to the person or business to be acquired and updated projections for Borrower after giving effect to such transaction, (C) a reasonably detailed description of all material information relating thereto and copies of all material documentation (or substantially final drafts of) pertaining to such transaction, and (D) all such other information and data relating to such transaction or the person or business to be acquired as may be reasonably requested by the Administrative Agent or the Required Lenders;

(viii)        at least three Business Days prior to the proposed date of consummation of the transaction, Borrower shall have delivered to the Agents and the Lenders an Officers’ Certificate certifying that (A) such transaction complies with this definition (which shall have attached thereto reasonably detailed backup data and calculations showing such compliance), and (B) such transaction could not reasonably be expected to result in a Material Adverse Effect; and

(ix)           the Acquisition Consideration (exclusive of (x) any amounts financed with the Available Basket Amount or (y) Acquisition Consideration consisting of Qualified Capital Stock of Holdings) for all Permitted Acquisitions since the Closing Date shall not exceed the Acquisition Threshold; provided that any Equity Interests constituting all or a portion of such Acquisition Consideration shall not have a cash dividend requirement on or prior to the Final Maturity Date.

“Permitted Collateral Liens” shall mean (a) in the case of Collateral other than Mortgaged Property, Permitted Liens and (b) in the case of Mortgaged Property, the Liens described in clauses (a), (b), (d), (e), (g) and (l) of Section 6.02 in addition to the Liens set forth on Schedule B to the respective Title Policy delivered pursuant to Section 4.01(m)(i), Section 5.11 or Section 5.12.

“Permitted Holders” shall mean (a) Sponsors and (b) their Controlled Investment Affiliates.

“Permitted Liens” shall have the meaning assigned to such term in Section 6.02.

“Permitted Subordinated Indebtedness” shall mean Subordinated Indebtedness the sole obligor of which is Holdings that (i) will not mature prior to the 180th day following the Term B Loan Maturity Date, (ii) has no scheduled amortization of principal or required or mandatory redemptions, or repurchases, sinking fund obligation or payments of principal prior to the 180th day following the Term B Loan Maturity Date, (iii) does not require any payments of interest or amounts in respect of the principal thereof (other than payments made through the increase of the principal amount thereof) prior to the 180th day following the Term B Loan Maturity Date, (iv) that is contractually subordinate or junior in right of payment (including as to “standstill” provisions) to the Obligations on terms reasonably satisfactory to the Administrative Agent, (v) contains covenants, events of default and other material terms that are reasonably satisfactory to the Administrative Agent, and (vi) is not secured by any Lien.

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“Permitted Tax Distributions” shall mean payments, dividends or distributions by Borrower (or another Restricted Subsidiary of Holdings) to Holdings (or its direct or indirect parent) in order for Holdings (or its direct or indirect parent) to pay the portion of its consolidated or combined U.S. federal, state and local income taxes attributable to the income of Borrower and any of Borrower’s Restricted Subsidiaries in an amount not to exceed the income tax liabilities that would have been payable by Borrower and its Restricted Subsidiaries on a stand-alone basis, reduced by any such income taxes paid or to be paid directly by Borrower or its Restricted Subsidiaries; provided that the amount of any such payments, dividends or distributions attributable to any income of an Unrestricted Subsidiary shall be limited to the cash distributions made by such Unrestricted Subsidiary to Borrower or its Restricted Subsidiaries for such purpose.  In determining the stand-alone income tax liability of Borrower and its Subsidiaries for purposes of the preceding sentence, any interest expense of Holdings shall be treated as an interest expense of Borrower.

“person” shall mean any natural person, corporation, limited liability company, trust, joint venture, association, company, partnership, Governmental Authority or other entity.

“Plan” shall mean any employee pension benefit plan (other than a Multiemployer Plan) subject to the provisions of Title IV of ERISA or Section 412 of the Code or Section 302 of ERISA which is maintained or contributed to by any Company or its ERISA Affiliate or with respect to which any Company could incur liability (including under Section 4069 of ERISA).

“Platform” shall have the meaning set forth in Section 10.01(c).

“PPSA” shall mean the Personal Property Security Act (Ontario), the Civil Code of Québec or any other applicable Canadian federal, provincial or territorial statute pertaining to the granting, perfecting, priority or ranking of security interests, liens, hypothecs on personal property, and any successor statutes, together with any regulations thereunder, in each case as in effect from time to time.  References to sections of the PPSA shall be construed to also refer to any successor sections.

“Preferred Stock” shall mean, with respect to any person, any and all preferred or preference Equity Interests (however designated) of such person whether now outstanding or issued after the Closing Date.

“Premises” shall have the meaning assigned thereto in the applicable Mortgage.

“Private Side Communications” shall have the meaning assigned to such term in Section 10.01(d).

“Private Siders” shall have the meaning assigned to such term in Section 10.01(d).

“Pro Forma Basis” shall mean on a basis in accordance with Section 1.04.

“Pro Forma Cost Savings” shall mean, with respect to any period, the reduction in net costs and related adjustments (which may include cost savings resulting from head count reduction, closure of facilities and similar restructurings) (a) that were directly attributable to a Subject Transaction that occurred during the relevant Test Period or except as provided in Section

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1.04(a), after the end of the Test Period and on or prior to the applicable Calculation Date and calculated on a basis that is consistent with Regulation S-X under the Securities Act as in effect and applied as of the Closing Date and as interpreted by the staff of the SEC, (b) that were actually implemented in connection with a Subject Transaction during the relevant Test Period or except as provided in Section 1.04(a), after the end of the Test Period and prior to the applicable Calculation Date and are supportable and quantifiable by the underlying accounting records, or (c) that relate to a Subject Transaction that has occurred and that Borrower projects in good faith based upon specifically identifiable actions taken or to be taken within 12 months of the date of consummation of such Subject Transaction; provided that (1) the only cost savings added in the calculation of Consolidated EBITDA pursuant to this definition in respect of the Transactions shall be the deemed amount of such cost savings equal to $1,100,000, (2) the aggregate amount of cost savings added in the calculation of Consolidated EBITDA pursuant to this definition shall not exceed $4,000,000 in the aggregate for any one Subject Transaction and $8,000,000 in the aggregate for any fiscal year and no amount shall be carried forward to any succeeding fiscal year, (3) in the case of clause (c) a duly completed certificate (the “Cost Savings Certificate”) signed by a Responsible Officer of Borrower shall have been delivered to the Administrative Agent, specifying the Subject Transaction and the expected reduction in net costs and related adjustments in reasonable detail and certifying that (i) Borrower projects such reduction in net costs and related adjustments in good faith based upon the actions specifically identified in such certificate, (ii) such actions are to be taken within (A) in the case of any reduction in net costs and related adjustments in connection with the Transactions, 12 months after the Closing Date and (B) in all other cases, within 12 months after the consummation of the applicable Subject Transaction, (4) no reduction in net costs and related adjustments shall be added pursuant to this definition or Section 1.04 to the extent duplicative of any expenses or charges otherwise added to Consolidated EBITDA, whether through a pro forma adjustment or otherwise, for such period, or of the actual costs savings realized, (5) reductions in net costs and related adjustments may no longer be added in calculating Consolidated EBITDA pursuant to this definition or Section 1.04 for periods commencing more than 12 months after the applicable Subject Transaction and (6) for each Test Period after the first Test Period for which cost savings for a Subject Transaction are reflected, the amount of reduction in net costs and related adjustments to be included in the calculation of Consolidated EBITDA with respect to such Subject Transaction for such period shall be reduced by 25% in the case of such Test Period immediately following the first Test Period for which cost savings for a Subject Transaction are reflected, and an additional 25% in the case of each of such other Test Periods, of the total amount of such reduction in net costs and related adjustments in respect thereof (in the case of clause (c) as specified in the Cost Savings Certificate).

“Pro Forma Effect” shall mean with respect to any Subject Transaction, Permitted Acquisition or other event, as applicable, giving effect to such Subject Transaction, Permitted Acquisition or other event on a Pro Forma Basis.

“Pro Rata Percentage” of any Revolving Lender at any time shall mean the percentage of the total Revolving Commitments of all Revolving Lenders represented by such Lender’s Revolving Commitment; provided that for purposes of Section 2.19(b) and (c), “Pro Rata Percentage” shall mean the percentage of the total Revolving Commitments (disregarding the Revolving Commitment of any Defaulting Lender to the extent its Swingline Exposure or LC Exposure is reallocated to the non-Defaulting Lenders) represented by such Lender’s Revolving

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Commitment.  If the Revolving Commitments have terminated or expired, the Pro Rata Percentage shall be determined based upon the Revolving Commitments most recently in effect, after giving effect to any assignments.

“property” shall mean any right, title or interest in or to property or assets of any kind whatsoever, whether real, personal or mixed and whether tangible or intangible and including Equity Interests or other ownership interests of any person and whether now in existence or owned or hereafter entered into or acquired, including all Real Property.

“Public Siders” shall have the meaning assigned to such term in Section 10.01(d).

“Purchase Money Obligation” shall mean, for any person, the obligations of such person in respect of Indebtedness (including Capital Lease Obligations) incurred for the purpose of financing all or any part of the purchase price of any property (including Equity Interests of any person) or the cost of installation, construction or improvement of any property and any refinancing thereof; provided, however, that (i) such Indebtedness is incurred within one year after such acquisition, installation, construction or improvement of such property by such person and (ii) the amount of such Indebtedness does not exceed 100% of the cost of such acquisition, installation, construction or improvement, as the case may be.

“Qualified Capital Stock” of any person shall mean any Equity Interests of such person that are not Disqualified Capital Stock.

“Ratings” shall mean, collectively, monitored public corporate credit/family ratings of Borrower and ratings of the Loans.

“Real Property” shall mean, collectively, all right, title and interest (including any leasehold, mineral or other estate) in and to any and all parcels of or interests in real property owned, leased or operated by any person, whether by lease, license or other means, together with, in each case, all easements, hereditaments and appurtenances relating thereto, all improvements and appurtenant fixtures and equipment, all general intangibles and contract rights and other property and rights incidental to the ownership, lease or operation thereof.

“Refinanced Term Loan” shall have the meaning assigned to such term in Section 10.02(e).

“Register” shall have the meaning assigned to such term in Section 10.04(b).

“Regulation D” shall mean Regulation D of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

“Regulation S-X” shall mean Regulation S-X promulgated under the Securities Act.

“Regulation T” shall mean Regulation T of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

“Regulation U” shall mean Regulation U of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

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“Regulation X” shall mean Regulation X of the Board as from time to time in effect and all official rulings and interpretations thereunder or thereof.

“Reimbursement Obligations” shall mean Borrower’s obligations under Section 2.18(e) to reimburse LC Disbursements.

“Related Fund” shall mean, with respect to any Lender that is an investment fund, any other investment fund that invests in commercial loans and that is managed or advised by the same investment advisor as such Lender or by an Affiliate of such investment advisor.

“Related Parties” shall mean, with respect to any person, such person’s Affiliates and the partners, directors, officers, employees, agents and advisors of such person and of such person’s Affiliates.

“Release” shall mean any spilling, leaking, seepage, pumping, pouring, emitting, emptying, discharging, injecting, escaping, leaching, dumping, disposing, depositing, dispersing, emanating or migrating of any Hazardous Material in, into, onto or through the Environment.

“Remaining Loan Party” shall have the meaning assigned to such term in Section 7.10.

“Replacement Term Loan” shall have the meaning assigned to such term in Section 10.02(e).

“Required Class Lenders” shall mean (i) with respect to each Class of Term Loans, Lenders having more than 50% of all Term Loans of such Class outstanding (subject to Section 10.04(h)) and (ii) with respect to Revolving Loans, Required Revolving Lenders.

“Required Lenders” shall mean Lenders having more than 50% of the sum of all Loans outstanding, LC Exposure and unused Commitments; provided (i) that the Loans, LC Exposure and unused Commitments held or deemed held by any Defaulting Lender shall be excluded for purposes of making a determination of Required Lenders and (ii) that Section 10.04(h) shall apply to Term Loans held by Affiliated Lenders.

“Required Revolving Lenders” shall mean Lenders having more than 50% of all Revolving Commitments or, after the Revolving Commitments have terminated, more than 50% of all Revolving Exposure; provided that the Revolving Commitments held or deemed held by any Defaulting Lender shall be excluded for purposes of making a determination of Required Revolving Lenders.

“Requirements of Law” shall mean, collectively, any and all applicable requirements of any Governmental Authority including any and all laws, judgments, orders, executive orders, decrees, ordinances, rules, regulations, statutes or case law, and shall include any, all zoning, building ordinances and codes, building permits and decrees of any Governmental Authority whether now in effect or hereafter enacted.

“Response” shall mean (a) “response” as such term is defined in CERCLA, 42 U.S.C. § 9601(24), and (b) all other actions required by any Governmental Authority or voluntarily undertaken to (i) clean up, remove, treat, abate or in any other way address any Hazardous Material

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in the Environment; (ii) prevent the Release or threat of Release, or minimize the further Release, of any Hazardous Material; or (iii) perform studies and investigations in connection with, or as a precondition to, or to determine the necessity of the activities described in, clause (i) or (ii) above.

“Responsible Officer” of any person shall mean any executive officer or Financial Officer of such person and any other officer or similar official thereof with responsibility for the administration of the obligations of such person in respect of this Agreement.

“Restricted Subsidiary” shall mean any Subsidiary that is not an Unrestricted Subsidiary.

“Revolving Availability Period” shall mean the period from and including the Closing Date to but excluding the earlier of (i) the Business Day preceding the Revolving Maturity Date and (ii) the date of termination of the Revolving Commitments.

“Revolving Borrowing” shall mean a Borrowing comprised of Revolving Loans.

“Revolving Commitment” shall mean, with respect to each Lender, the commitment, if any, of such Lender to make Revolving Loans hereunder up to the amount set forth on Schedule I to the Lender Addendum executed and delivered by such Lender or by an Increase Joinder, or in the Assignment and Assumption pursuant to which such Lender assumed its Revolving Commitment, as applicable, as the same may be (a) reduced from time to time pursuant to Section 2.07 and (b) reduced or increased from time to time pursuant to assignments by or to such Lender pursuant to Section 10.04.  The aggregate amount of the Lenders’ Revolving Commitments on the Closing Date is $30,000,000.

“Revolving Exposure” shall mean, with respect to any Lender at any time, the aggregate principal amount at such time of all outstanding Revolving Loans of such Lender, plus the aggregate amount at such time of such Lender’s LC Exposure, plus the aggregate amount at such time of such Lender’s Swingline Exposure.

“Revolving Lender” shall mean a Lender with a Revolving Commitment.

“Revolving Loan” shall mean a Loan made by the Lenders to Borrower pursuant to Section 2.01(b).  Each Revolving Loan shall either be an ABR Revolving Loan or a Eurodollar Revolving Loan.

“Revolving Maturity Date” shall mean the date which is five years after the Closing Date or, if such date is not a Business Day, the first Business Day thereafter.

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

“Sale and Leaseback Transaction” shall have the meaning assigned to such term in Section 6.03.

“Sanctions” shall have the meaning assigned to such term in Section 3.12.

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“Secured Obligations” shall mean (a) the Obligations, (b) the due and punctual payment and performance of all obligations of Borrower and the other Loan Parties under each Hedging Agreement entered into with any counterparty that is a Secured Party and (c) the due and punctual payment and performance of all obligations of Borrower and the other Loan Parties (including overdrafts and related liabilities) under each Treasury Services Agreement entered into with any counterparty that is a Secured Party.

“Secured Parties” shall mean, collectively, the Administrative Agent, the Collateral Agent, each other Agent, the Issuing Bank, the Lenders and each counterparty to a Hedging Agreement or Treasury Services Agreement (which in the case of any counterparty other than any Agent or its Affiliates, shall be designated by Borrower as a Secured Party at the time such agreement is entered into), if at the date of entering into such Hedging Agreement or Treasury Services Agreement such person was an Agent or a Lender or an Affiliate of an Agent or a Lender and such person executes and delivers to the Administrative Agent a letter agreement in form and substance acceptable to the Administrative Agent pursuant to which such person (i) appoints the Collateral Agent as its agent under the applicable Loan Documents and (ii) agrees to be bound by the provisions of Sections 9.03, 10.03 and 10.09 as if it were a Lender.

“Securities Act” shall mean the Securities Act of 1933.

“Securities Collateral” shall have the meaning assigned to such term in the Security Agreement.

“Security Agreement” shall mean a Security Agreement substantially in the form of Exhibit M among the Loan Parties and Collateral Agent for the benefit of the Secured Parties.

“Security Agreement Collateral” shall mean all property pledged or granted as collateral pursuant to the Security Agreement (a) on the Closing Date or (b) thereafter pursuant to Section 5.11.

“Security Documents” shall mean the Security Agreement, the Mortgages and each other security document or pledge agreement delivered in accordance with applicable local or Canadian law to grant a valid, perfected security interest in any property as collateral for the Secured Obligations, and all UCC or other financing statements or instruments of perfection required by this Agreement, the Security Agreement, any Mortgage or any other such security document or pledge agreement to be filed with respect to the security interests in property and fixtures created pursuant to the Security Agreement or any Mortgage and any other document or instrument utilized to pledge or grant a security interest or lien on any property as collateral for the Secured Obligations.

“Seller” shall have the meaning assigned to such term in the first recital hereto.

“Senior Note Agreement” shall mean any indenture, note purchase agreement or other agreement pursuant to which the Senior Notes are issued as in effect on the date hereof and thereafter amended from time to time, to the extent permissible under this Agreement.

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“Senior Note Documents” shall mean the Senior Notes, the Senior Note Agreement, the Senior Note Guarantees and all other documents executed and delivered with respect to the Senior Notes or the Senior Note Agreement.

“Senior Note Guarantees” shall mean the guarantees of Holdings and the Subsidiary Guarantors pursuant to the Senior Note Agreement.

“Senior Notes” shall mean Borrower’s 8.00% Senior Notes due 2018 issued pursuant to the Senior Note Agreement.

“Specified Equity Contribution” shall mean any cash contribution to the common equity of Holdings and/or any other cash purchase or investment in the Equity Interests of Holdings (other than Disqualified Capital Stock), the cash proceeds of which are contributed to Borrower as cash common equity; provided that the Equity Financing shall not constitute a Specified Equity Contribution.

“Specified Person” shall have the meaning assigned to such term in Section 3.23.

“Specified Representations” shall have the meaning assigned to such term in Section 4.01(q).

“Sponsors” shall, collectively, mean The Veritas Capital Fund III, L.P. and The Veritas Capital Fund, IV, L.P., and each shall individually be a “Sponsor”.

“Standby Letter of Credit” shall mean any standby letter of credit or similar instrument, in each case in form and substance reasonably acceptable to the Issuing Bank and issued for any legal purpose.

“Statutory Reserves” shall mean for any Interest Period for any Eurodollar Borrowing, the average maximum rate at which reserves (including any marginal, supplemental or emergency reserves) are required to be maintained during such Interest Period under Regulation D by member banks of the United States Federal Reserve System in New York City with deposits exceeding one billion dollars against “Eurocurrency liabilities” (as such term is used in Regulation D).  Eurodollar Borrowings shall be deemed to constitute Eurodollar liabilities and to be subject to such reserve requirements without benefit of or credit for proration, exceptions or offsets which may be available from time to time to any Lender under Regulation D.

“Stock Certificates” shall mean certificates evidencing Collateral consisting of Equity Interests of each Subsidiary of Holdings for which a security interest can be perfected by delivering such stock certificates.

“Subject Transaction” shall mean any of the Transactions, any future acquisition, investment, disposition, issuance, incurrence or repayment of Indebtedness, offering, issuance or disposition of Equity Interests, recapitalization, merger, consolidation, disposed or discontinued operation, multi-year strategic initiative or any other action specified in the Cost Savings Certificate made by Borrower or any of its Restricted Subsidiaries, including through mergers or consolidations, or any person or any of its Restricted Subsidiaries acquired by Borrower or any of its

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Restricted Subsidiaries, and including any related financing transactions and including increases in ownership of Restricted Subsidiaries.

“Subordinated Indebtedness” shall mean Indebtedness of Borrower or any Guarantor that is by its terms subordinated in right of payment to the Obligations of Borrower and such Guarantor, as applicable.

“Subsidiary” shall mean, with respect to any person (the “parent”) at any date, (i) any person the accounts of which would be consolidated with those of the parent in the parent’s consolidated financial statements if such financial statements were prepared in accordance with GAAP as of such date, (ii) any other corporation, limited liability company, association or other business entity of which securities or other ownership interests representing more than 50% of the voting power of all Equity Interests entitled (without regard to the occurrence of any contingency) to vote in the election of the Board of Directors thereof are, as of such date, owned, controlled or held by the parent and/or one or more subsidiaries of the parent, and (iii) any partnership (a) the sole general partner or the managing general partner of which is the parent and/or one or more subsidiaries of the parent or (b) the only general partners of which are the parent and/or one or more subsidiaries of the parent.  Unless the context requires otherwise, “Subsidiary” refers to a Subsidiary of Holdings.

“Subsidiary Guarantor” shall mean each Restricted Subsidiary listed on Schedule 1.01(b), and each other Restricted Subsidiary that is or becomes a party to this Agreement pursuant to Section 5.11; provided that, for the avoidance of doubt, Borrower will not be deemed to be a Subsidiary Guarantor.

“Survey” shall mean a survey of any Mortgaged Property (and all improvements thereon) which is (a) (i) prepared by a surveyor or engineer licensed to perform surveys in the jurisdiction where such Mortgaged Property is located, (ii) dated (or redated) not earlier than six months prior to the date of delivery thereof unless there shall have occurred within six months prior to such date of delivery any exterior construction on the site of such Mortgaged Property or any easement, right of way or other interest in the Mortgaged Property has been granted or become effective through operation of law or otherwise with respect to such Mortgaged Property which, in either case, can be depicted on a survey, in which events, as applicable, such survey shall be dated (or redated) after the completion of such construction or if such construction shall not have been completed as of such date of delivery, not earlier than 20 days prior to such date of delivery, or after the grant or effectiveness of any such easement, right of way or other interest in the Mortgaged Property, (iii) certified by the surveyor (in a manner reasonably acceptable to the Administrative Agent) to the Administrative Agent, the Collateral Agent and the Title Company, (iv) complying in all respects with the minimum detail requirements of the American Land Title Association as such requirements are in effect on the date of preparation of such survey and indicating the flood zone designation (with proper annotation based on federal Flood Insurance Rate Maps or the state or local equivalent) and (v) sufficient for the Title Company to remove all standard survey exceptions from the title insurance policy (or commitment) relating to such Mortgaged Property and issue the endorsements of the type required by Section 4.01(m)(iii) or (b) otherwise reasonably acceptable to the Collateral Agent.

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“Swingline Commitment” shall mean the commitment of the Swingline Lender to make loans pursuant to Section 2.17, as the same may be reduced from time to time pursuant to Section 2.07 or Section 2.17.  The amount of the Swingline Commitment shall initially be $5,000,000, but shall in no event exceed the Revolving Commitment.

“Swingline Exposure” shall mean at any time the aggregate principal amount at such time of all outstanding Swingline Loans.  The Swingline Exposure of any Revolving Lender at any time shall equal its Pro Rata Percentage of the aggregate Swingline Exposure at such time.

“Swingline Lender” shall have the meaning assigned to such term in the preamble hereto.

“Swingline Loan” shall mean any loan made by the Swingline Lender pursuant to Section 2.17.

“Syndication Agent” shall have the meaning assigned to such term in the preamble hereto.

“Tax Return” shall mean all returns, statements, filings, attachments and other documents or certifications required to be filed in respect of Taxes.

“Taxes” shall mean all present or future taxes, levies, imposts, duties, deductions, withholdings, assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

“Term B Loan Commitment” shall mean, with respect to each Lender, the commitment, if any, of such Lender to make a Term B Loan hereunder on the Closing Date in the amount set forth on Schedule I to the Lender Addendum executed and delivered by such Lender, or in the Assignment and Assumption pursuant to which such Lender shall have assumed its Term B Loan Commitment, as applicable, as the same may be (a) reduced from time to time pursuant to Section 2.07 and (b) reduced or increased from time to time pursuant to assignments by or to such Lender pursuant to Section 10.04.  The initial aggregate amount of the Lenders’ Term B Loan Commitments is $150,000,000.

“Term B Loan Lender” shall mean a Lender with a Term B Loan Commitment or an outstanding Term B Loan.

“Term B Loan Maturity Date” shall mean the date which is six years after the Closing Date or, if such date is not a Business Day, the first Business Day thereafter.

“Term B Loans” shall mean the term loans made by the Lenders to Borrower pursuant to Section 2.01(a).  Each Term B Loan shall be either an ABR Term Loan or a Eurodollar Term Loan.

“Term Borrowing” shall mean a Borrowing comprised of Term Loans.

“Term Loan Commitments” shall mean the Term B Loan Commitments and the Incremental Term Loan Commitments.

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“Term Loan Lender” shall mean a Lender with a Term Loan Commitment or an outstanding Term Loan.

“Term Loan Repayment Date” shall have the meaning assigned to such term in Section 2.09.

“Term Loans” shall mean the Term B Loans and the Incremental Term Loans.

A “Test Period” at any time shall mean the period of four consecutive fiscal quarters of Borrower ended on or prior to such time (taken as one accounting period); provided that for purposes of making any determinations hereunder on a Pro Forma Basis “Test Period” shall refer to the last four consecutive fiscal quarter period for which consolidated financial statements of Holdings have been (or were required to be) delivered pursuant to Section 5.01(a) or (b), as applicable.

“Title Company” shall mean any title insurance company as shall be retained by Borrower and reasonably acceptable to the Administrative Agent.

“Title Policy” shall have the meaning assigned to such term in Section 4.01(m)(iii).

“Total Available Net Assets” shall have the meaning assigned to such term in Section 7.08(a).

“Total Leverage Ratio” shall mean, at any date of determination, the ratio of Consolidated Indebtedness on such date to Consolidated EBITDA for the Test Period then most recently ended.

“Transaction Costs” shall mean the fees, costs and expenses payable by Holdings, Borrower or any of Borrower’s Subsidiaries in connection with the Transactions.

“Transaction Documents” shall mean the Merger Documents, the Senior Note Documents and the Loan Documents.

“Transactions” shall mean, collectively, the transactions to occur on or prior to the Closing Date pursuant to the Transaction Documents, including (a) the consummation of the Merger; (b) the execution, delivery and performance of the Loan Documents and the initial borrowings hereunder; (c)  the Equity Financing; (d) the execution, delivery and performance of and the issuance of the Senior Notes; and (e) the payment of all fees and expenses to be paid on or prior to or within 270 days after the Closing Date and owing in connection with the foregoing.

“Transferred Guarantor” shall have the meaning assigned to such term in Section 7.09.

“Treasury Services Agreement” shall mean any agreement relating to treasury, depositary and cash management services or automated clearinghouse transfer of funds.

“Type,” when used in reference to any Loan or Borrowing, refers to whether the rate of interest on such Loan, or on the Loans comprising such Borrowing, is determined by reference to the Adjusted LIBOR Rate or the Alternate Base Rate.

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“UCC” shall mean the Uniform Commercial Code as in effect from time to time (except as otherwise specified) in any applicable state or jurisdiction.

“UCC Filing Collateral” shall mean Collateral, excluding Stock Certificates, consisting solely of assets for which a security interest can be perfected by filing a UCC financing statement.

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

“Unrestricted Subsidiary” shall mean (a) any Subsidiary of Holdings (other than Borrower) that shall have been designated an Unrestricted Subsidiary by Holdings in the manner provided below and (b) any Subsidiary of an Unrestricted Subsidiary.  Holdings may designate any Subsidiary (including any newly acquired or newly formed Subsidiary) to be an Unrestricted Subsidiary if (i) neither such Subsidiary nor any of its Subsidiaries owns any Equity Interests of, or holds any Lien on any property of, Holdings, Borrower or any other Restricted Subsidiary (other than a Restricted Subsidiary which is also concurrently becoming an Unrestricted Subsidiary), (ii) after giving effect to such designation, Holdings shall be in compliance with Section 6.04 (it being understood that, for purposes of determining such compliance, all Investments made (at the time of and following such designation) by Loan Parties in any Subsidiary so designated, shall be deemed to be Investments in an Unrestricted Subsidiary), (iii) after giving effect to such designation, Borrower and the Restricted Subsidiaries shall be in compliance on a Pro Forma Basis with the covenants contained in Section 6.09 recomputed as at the last day of the most recent Test Period, as if such designation had occurred on the first day of each relevant period for testing such compliance and (iv) no Default shall have occurred and be continuing or would result therefrom.  Holdings may designate any Unrestricted Subsidiary to be a Restricted Subsidiary if (i) no Default shall have occurred and be continuing or would result therefrom and (ii) after giving effect to such designation, Borrower and the Restricted Subsidiaries are in compliance on a Pro Forma Basis with the covenants contained in Section 6.09 recomputed as at the last day of the most recent Test Period.  Holdings shall promptly notify the Administrative Agent in writing of any such designation (and the Administrative Agent shall notify the Lenders) and shall deliver to the Administrative Agent a certificate signed by a Financial Officer of Borrower certifying that such designation complied with the foregoing provisions together with reasonably detailed calculations demonstrating satisfaction of the requirement set forth in clause (iii) of the second sentence of this definition or in clause (ii) of the third sentence of this definition, as applicable.  For the avoidance of doubt, the designation of any Unrestricted Subsidiary as a Restricted Subsidiary shall constitute the incurrence at the time of designation of any Indebtedness or Liens of such Subsidiary existing at such time.  As of the Closing Date, there are no Unrestricted Subsidiaries.

“USA PATRIOT Act” shall have the meaning set forth in the definition of “Anti-Terrorism Laws.”

“Voting Stock” shall mean, with respect to any person, any class or classes of Equity Interests pursuant to which the holders thereof have the general voting power under ordinary circumstances to elect at least a majority of the Board of Directors of such person.

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“Wholly Owned Subsidiary” shall mean, as to any person, (a) any corporation 100% of whose Equity Interests (other than directors’ qualifying shares or the functional equivalent thereof, or Equity Interests that are required to be held by another person in order to satisfy a Requirement of Law prescribing an equity owner resident in the local jurisdiction) is at the time owned by such person and/or one or more Wholly Owned Subsidiaries of such person and (b) any partnership, association, joint venture, limited liability company or other entity in which such person and/or one or more Wholly Owned Subsidiaries of such person have a 100% equity interest at such time.

“Withdrawal Liability” shall mean liability to a Multiemployer Plan as a result of a complete or partial withdrawal from such Multiemployer Plan, as such terms are defined in Part I of Subtitle E of Title IV of ERISA.

SECTION 1.02              Classification of Loans and Borrowings.

For purposes of this Agreement, Loans may be classified and referred to by Class (e.g., a “Revolving Loan”) or by Type (e.g., a “Eurodollar Loan”) or by Class and Type (e.g., a “Eurodollar Revolving Loan”).  Borrowings also may be classified and referred to by Class (e.g., a “Revolving Borrowing”) or by Type (e.g., a “Eurodollar Borrowing”) or by Class and Type (e.g., a “Eurodollar Revolving Borrowing”).

SECTION 1.03              Terms Generally.

The definitions of terms herein shall apply equally to the singular and plural forms of the terms defined.  Whenever the context may require, any pronoun shall include the corresponding masculine, feminine and neuter forms.  The words “include,” “includes” and “including” shall be deemed to be followed by the phrase “without limitation.”  The word “will” shall be construed to have the same meaning and effect as the word “shall.”  Unless the context requires otherwise (a) any definition of or reference to any Loan Document, agreement, instrument or other document herein shall be construed as referring to such agreement, instrument or other document as from time to time amended, supplemented or otherwise modified (subject to any restrictions on such amendments, supplements or modifications set forth herein and in the other Loan Documents), (b) any reference herein to any person shall be construed to include such person’s successors and assigns, (c) the words “herein,” “hereof” and “hereunder,” and words of similar import, shall be construed to refer to this Agreement in its entirety and not to any particular provision hereof, (d) all references herein to Articles, Sections, Exhibits and Schedules shall be construed to refer to Articles and Sections of, and Exhibits and Schedules to, this Agreement, (e) any reference to any law or regulation herein shall refer to such law or regulation as amended, modified or supplemented from time to time, (f) the words “asset” and “property” shall be construed to have the same meaning and effect and to refer to any and all tangible and intangible assets and properties, including cash, securities, accounts and contract rights and (g) “on,” when used with respect to the Mortgaged Property or any property adjacent to the Mortgaged Property, means “on, in, under, above or about.”  Any reference to a “Schedule” herein shall be deemed to be a reference to a Schedule in the Disclosure Letter.

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SECTION 1.04              Certain Calculations.

(a)           For purposes of (i) determining compliance with the financial covenants set forth in Section 6.09, including pursuant to clause (ii) of the definition of “Permitted Acquisitions,” the definition of “Unrestricted Subsidiary”, Section 2.20(b)(iii), Section 6.01(m) and Section 6.07(d) and (ii) the calculation of the Total Leverage Ratio for purposes of the definition of “Applicable ECF Percentage” (collectively, the “Applicable Calculations”), the following shall apply, except that when calculating compliance with the financial covenants set forth in Section 6.09 on an actual basis (but not when giving Pro Forma Effect to a Permitted Acquisition pursuant to clause (ii) of the definition of “Permitted Acquisitions”) and calculating the Total Leverage Ratio for purposes of the definition of “Applicable ECF Percentage,” the events described in this Section 1.04 that occurred subsequent to the end of the applicable Test Period shall not be given Pro Forma Effect.

(b)           If any Subject Transaction (other than Subject Transactions covered by Section 1.04(c)) shall have occurred during the applicable Test Period or subsequent to such Test Period and on or prior to the applicable Calculation Date (as hereinafter defined), the Applicable Calculations shall be calculated with respect to such period giving Pro Forma Effect to such Subject Transaction, including Pro Forma Cost Savings (and the change in any associated Consolidated EBITDA resulting therefrom), as if they had occurred on the first day of the Test Period.

(c)           In the event that Borrower or any of its Restricted Subsidiaries incurs, assumes, guarantees, repays, repurchases, redeems, defeases, retires, extinguishes or otherwise discharges any Indebtedness subsequent to the commencement of the Test Period for which the Applicable Calculations are being calculated and on or prior to the date on which the event for which the Applicable Calculations are being calculated occurs or as of which the calculation is otherwise made (the “Calculation Date”), then the Applicable Calculations will be calculated giving Pro Forma Effect to such incurrence, assumption, guarantee, repayment, repurchase, redemption, defeasance, retirement, extinguishment or other discharge of Indebtedness (and any change in Consolidated Interest Expense resulting therefrom), and the use of the proceeds therefrom, as if the same had occurred at the beginning of the applicable Test Period, provided that (i) in calculating the Cash Interest Coverage Ratio no Pro Forma Effect shall be given to the incurrence or repayment of working capital borrowings, unless such Indebtedness has been permanently repaid and (ii) in calculating the Total Leverage Ratio as of the Calculation Date or the last day of the Test Period, the amount of outstanding Consolidated Indebtedness shall be calculated based upon the amount outstanding as of the Calculation Date or such last day of the Test Period, as the case may be, giving Pro Forma Effect to the incurrence or repayment of any such Indebtedness on such date.

(d)           If since the beginning of the Test Period any person (that subsequently became a Restricted Subsidiary of Borrower or was merged with or into Borrower or any Restricted Subsidiary of Borrower since the beginning of such period) shall have made any transaction that would have required adjustment pursuant to this Section 1.04, then the Applicable Calculations shall be calculated giving Pro Forma Effect thereto for such period as if such transaction had occurred at the beginning of the applicable Test Period.

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(e)           In calculating the Applicable Calculations, any Person that is a Restricted Subsidiary of Borrower on the applicable Calculation Date will be deemed to have been a Restricted Subsidiary of Borrower at all times during such Test Period.

(f)            In calculating the Applicable Calculations, any Person that is not a Restricted Subsidiary of Borrower on the applicable Calculation Date will be deemed not to have been a Restricted Subsidiary of Borrower at any time during such Test Period.

(g)           In calculating the Applicable Calculations, if any Indebtedness bears a floating rate of interest, the interest expense on such Indebtedness will be calculated as if the rate in effect on the applicable Calculation Date had been the applicable rate for the entire period (after giving effect to the operation of any Hedging Agreement applicable to such Indebtedness).

(h)           In calculating the Applicable Calculations for any period, interest on any Indebtedness under a revolving credit facility shall be computed based upon the average daily balance of such Indebtedness during the portion of the period during which the Indebtedness was outstanding.

(i)            For purposes of determining compliance with Section 6.09(a) and (b) on a Pro Forma Basis in order to determine the permissibility of a transaction to the extent such compliance is being measured as of a date prior to the last day of the first Test Period for which the covenants in Sections 6.09(a) and (b) are required to be satisfied, the levels set forth in Sections 6.09(a) and (b) for the last day of such first Test Period shall be deemed to apply in determining compliance with such covenants.

(j)            In calculating the Applicable Calculations, Unrestricted Subsidiaries shall be disregarded.

(k)           Calculations of ratios and tests for Pro Forma Basis shall be made for the Test Period then in effect at such time.

SECTION 1.05              Accounting Terms; GAAP.

(a)           Except as otherwise expressly provided herein, all financial statements to be delivered pursuant to this Agreement shall be prepared in accordance with GAAP as in effect from time to time and all terms of an accounting or financial nature shall be construed and interpreted in accordance with GAAP, as in effect on the date hereof unless otherwise agreed to by Borrower and the Required Lenders.

(b)           Notwithstanding any other provision contained herein, all terms of an accounting or financial nature shall be construed, and all computations of amounts and ratios referred to in, and determinations of compliance with the provisions of, Section 6.09 (including all relevant definitions used therein or for such purposes) hereof shall be made without giving effect to any election under FASB Accounting Standards Codification (“ASC”) 805, 810 or 825 (or any other part of FASB Accounting Standards Codification having a similar result or effect) for all purposes, including to value any Indebtedness or other liabilities of any Loan Party or any Subsidiary of any Loan Party at “fair value” or to include any gain or loss attributable thereto in the calculation of net income (or loss) of any Loan Party or any Subsidiary of any Loan Party.

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SECTION 1.06              Resolution of Drafting Ambiguities.

Each Loan Party acknowledges and agrees that it was represented by counsel in connection with the execution and delivery of the Loan Documents to which it is a party, that it and its counsel reviewed and participated in the preparation and negotiation hereof and thereof and that any rule of construction to the effect that ambiguities are to be resolved against the drafting party shall not be employed in the interpretation hereof or thereof.

ARTICLE II.

THE CREDITS

SECTION 2.01              Commitments.

Subject to the terms and conditions and relying upon the representations and warranties herein set forth, each Lender agrees, severally and not jointly:

(a)           to make a term loan to Borrower on the Closing Date in the principal amount equal to its Term B Loan Commitment; and

(b)           to make revolving loans to Borrower, at any time and from time to time on or after the Closing Date until the earlier of the Revolving Maturity Date and the termination of the Revolving Commitment of such Lender in accordance with the terms hereof, in an aggregate principal amount at any time outstanding that will not result in such Lender’s Revolving Exposure exceeding such Lender’s Revolving Commitment; provided however, that loans made pursuant to this Section 2.01(b) on the Closing Date shall only be used to fund the Transactions and shall not exceed $5,000,000 plus amounts to fund upfront fees in accordance with the Fee Letter.

Amounts paid or prepaid in respect of Term Loans may not be reborrowed.  Within the limits set forth in clause (b) above and subject to the terms, conditions and limitations set forth herein, Borrower may borrow, pay or prepay and reborrow Revolving Loans.

SECTION 2.02              Loans.

(a)           Each Loan (other than Swingline Loans) shall be made as part of a Borrowing consisting of Loans made by the Lenders ratably in accordance with their applicable Commitments; provided that the failure of any Lender to make its Loan shall not in itself relieve any other Lender of its obligation to lend hereunder (it being understood, however, that no Lender shall be responsible for the failure of any other Lender to make any Loan required to be made by such other Lender).  Except for Loans deemed made pursuant to Section 2.18(e)(i) and (ii), (x) ABR Loans comprising any Borrowing shall be in an aggregate principal amount that is (i) an integral multiple of $500,000 and not less than $500,000 or (ii) equal to the remaining available balance of the applicable Commitments and (y) the Eurodollar Loans comprising any Borrowing shall be in an aggregate principal amount that is (i) an integral multiple of $1,000,000 and not less than $1,000,000 or (ii) equal to the remaining available balance of the applicable Commitments.

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(b)           Subject to Sections 2.11 and 2.12, each Borrowing shall be comprised entirely of ABR Loans or Eurodollar Loans as Borrower may request pursuant to Section 2.03.  Each Lender may at its option make any Eurodollar Loan by causing any domestic or foreign branch or Affiliate of such Lender to make such Loan; provided that any exercise of such option shall not affect the obligation of Borrower to repay such Loan in accordance with the terms of this Agreement.  Borrowings of more than one Type may be outstanding at the same time; provided that Borrower shall not be entitled to request any Borrowing that, if made, would result in more than eight Eurodollar Borrowings outstanding hereunder at any one time.  For purposes of the foregoing, Borrowings having different Interest Periods, regardless of whether they commence on the same date, shall be considered separate Borrowings.

(c)           Except with respect to Loans deemed made pursuant to Section 2.18(e)(ii), each Lender shall make each Loan to be made by it hereunder on the proposed date thereof by wire transfer of immediately available funds to such account in New York City as the Administrative Agent may designate not later than 2:00 p.m., New York City time, and the Administrative Agent shall promptly credit the amounts so received to an account as directed by Borrower in the applicable Borrowing Request maintained with the Administrative Agent or, if a Borrowing shall not occur on such date because any condition precedent herein specified shall not have been met, return the amounts so received to the respective Lenders.

(d)           Unless the Administrative Agent shall have received notice from a Lender prior to the date (in the case of any Eurodollar Borrowing), and at least 2 hours prior to the time (in the case of any ABR Borrowing), of any Borrowing that such Lender will not make available to the Administrative Agent such Lender’s portion of such Borrowing, the Administrative Agent may assume that such Lender has made such portion available to the Administrative Agent at the time of such Borrowing in accordance with paragraph (c) above, and the Administrative Agent may, in reliance upon such assumption, make available to Borrower on such date a corresponding amount.  If the Administrative Agent shall have so made funds available, then, to the extent that such Lender shall not have made such portion available to the Administrative Agent, each of such Lender and Borrower severally agrees to repay to the Administrative Agent within one (1) Business Day of demand therefor such corresponding amount together with interest thereon, for each day from the date such amount is made available to Borrower until the date such amount is repaid to the Administrative Agent at (i) in the case of Borrower, the interest rate applicable at the time to the Loans comprising such Borrowing and (ii) in the case of such Lender, the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation.  If such Lender shall repay to the Administrative Agent such corresponding amount, such amount shall constitute such Lender’s Loan as part of such Borrowing for purposes of this Agreement, and Borrower’s obligation to repay the Administrative Agent such corresponding amount pursuant to this Section 2.02(d) shall cease.  Nothing in this Section 2.02(d) shall be deemed to release any Lender from its obligation to fulfill its Commitments hereunder or to prejudice any rights that Borrower may have against any Lender as a result of any default by such Lender hereunder.

(e)           Notwithstanding any provision to the contrary contained herein, Borrower shall not be entitled to request, or to elect to convert or continue, any Borrowing if the Interest Period requested with respect thereto would end after the Revolving Maturity Date, Term B Loan Maturity Date or Incremental Term Loan Maturity Date, as applicable.

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SECTION 2.03              Borrowing Procedure.

To request Loans, Borrower shall deliver, by hand delivery, e-mail through a “pdf” copy (if arrangements for doing so have been approved by the Administrative Agent) or facsimile, a duly completed and executed Borrowing Request to the Administrative Agent (i) in the case of Eurodollar Loans, not later than 11:00 a.m., New York City time, three Business Days before the date of the proposed Borrowing (or such shorter period as the Administrative Agent is willing to accommodate) or (ii) in the case of ABR Loans (other than Swingline Loans), not later than 12:00 noon, New York City time, on the Business Day of the proposed Borrowing.  Each Borrowing Request shall be irrevocable and shall specify the following information in compliance with Section 2.02:

(a)           whether the requested borrowing is to be a borrowing of Revolving Loans, Term B Loans or Incremental Term Loans;

(b)           the aggregate amount of such borrowing;

(c)           the date of such borrowing, which shall be a Business Day;

(d)           whether such borrowing is to be for ABR Loans or Eurodollar Loans;

(e)           in the case of Eurodollar Loans, the initial Interest Period to be applicable thereto, which shall be a period contemplated by the definition of the term “Interest Period”; provided that prior to the earlier of (i) the date that is 90 days after the Closing Date and (ii) the date the completion of the primary syndication of the Commitments and Loans (as determined by the Arranger) (or such shorter period as may be approved by UBS Securities LLC), the Interest Period shall be one month;

(f)            the location and number of Borrower’s account to which funds are to be disbursed; and

(g)           that the conditions set forth in Sections 4.02(b)-(d) have been satisfied as of the date of the notice.

If no election as to the Type of Loans is specified, then the requested borrowing shall be for ABR Loans.  If no Interest Period is specified with respect to any requested Eurodollar Loan, then Borrower shall be deemed to have selected an Interest Period of one month’s duration.  Promptly following receipt of a Borrowing Request in accordance with this Section, the Administrative Agent shall advise each Lender of the details thereof and of the amount of such Lender’s Loan to be made as part of the requested Borrowing.

SECTION 2.04              Evidence of Debt; Repayment of Loans.

(a)           Promise to Repay.  Borrower hereby unconditionally promises to pay (i) to the Administrative Agent for the account of each Term Loan Lender, the principal amount of each Term Loan of such Term Loan Lender as provided in Section 2.09, (ii) to the Administrative Agent for the account of each Revolving Lender, the then unpaid principal amount of each Revolving Loan of such Revolving Lender on the Revolving Maturity Date and (iii) to the

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Swingline Lender, the then unpaid principal amount of each Swingline Loan on the earlier of the Revolving Maturity Date and the first date after such Swingline Loan is made that is the 15th or last day of a calendar month and is at least two Business Days after such Swingline Loan is made; provided that on each date that a Revolving Borrowing is made, Borrower shall repay all Swingline Loans that were outstanding on the date such Borrowing was requested.

(b)           Lender and Administrative Agent Records.  Each Lender shall maintain in accordance with its usual practice an account or accounts evidencing the Indebtedness of Borrower to such Lender resulting from each Loan made by such Lender from time to time, including the amounts of principal and interest payable and paid to such Lender from time to time under this Agreement.  The Administrative Agent shall maintain records including (i) the amount of each Loan made hereunder, the Type and Class thereof and the Interest Period applicable thereto; (ii) the amount of any principal or interest due and payable or to become due and payable from Borrower to each Lender hereunder; and (iii) the amount of any sum received by the Administrative Agent hereunder for the account of the Lenders and each Lender’s share thereof.  The entries made in the records maintained by the Administrative Agent and each Lender pursuant to this paragraph shall be prima facie evidence (absent manifest error) of the existence and amounts of the obligations therein recorded; provided that the failure of any Lender or the Administrative Agent to maintain such records or any error therein shall not in any manner affect the obligations of Borrower to repay the Loans in accordance with their terms.  In the event of any conflict between the records maintained by any Lender and the records of the Administrative Agent in respect of such matters, the records of the Administrative Agent shall control in the absence of manifest error.

(c)           Promissory Notes.  Any Lender by written notice to Borrower (with a copy to the Administrative Agent) may request that Loans of any Class made by it be evidenced by a promissory note.  In such event, Borrower shall prepare, execute and deliver to such Lender a promissory note payable to the order of such Lender (or, if requested by such Lender, to such Lender and its registered assigns) in the form of Exhibit K-1, K-2 or K-3, as the case may be.  Thereafter, the Loans evidenced by such promissory note and interest thereon shall at all times (including after assignment pursuant to Section 10.04) be represented by one or more promissory notes in such form payable to such payee and its registered assigns.  Upon the request of Borrower after payment in full of all Obligations (other than contingent indemnification obligations as to which no claim has been asserted), each Lender that has received a promissory note pursuant to this Section 2.04(c) shall deliver such promissory note to Borrower for cancellation.

SECTION 2.05              Fees.

(a)           Commitment Fee.  Borrower agrees to pay to the Administrative Agent for the account of each Lender a commitment fee (a “Commitment Fee”) equal to the Applicable Fee per annum on the average daily unused amount of the Revolving Commitment of such Lender during the period from and including the date hereof to but excluding the date on which such Revolving Commitment terminates.  Accrued Commitment Fees shall be payable in arrears (A) on the last Business Day of March, June, September and December of each year, commencing on the first such date to occur after the date hereof, and (B) on the date on which such Revolving Commitment terminates.  Commitment Fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day but excluding the

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last day).  For purposes of computing Commitment Fees with respect to Revolving Commitments, a Revolving Commitment of a Lender shall be deemed to be used to the extent of the outstanding Revolving Loans and LC Exposure of such Lender (and the Swingline Exposure of such Lender shall be disregarded for such purpose).

(b)           Administrative Agent Fees.  Borrower agrees to pay to the Administrative Agent, for its own account, the administrative fees payable in the amounts and at the times set forth in that certain fee letter dated as of the Closing Date between UBS AG, Stamford Branch and the Borrower (the “Administrative Agent Fees”).

(c)           LC and Fronting Fees.  Borrower agrees to pay (i) to the Administrative Agent for the account of each Revolving Lender a participation fee (“LC Participation Fee”) with respect to its participations in Letters of Credit, which shall accrue at a rate equal to the Applicable Margin from time to time used to determine the interest rate on Eurodollar Revolving Loans pursuant to Section 2.06 on the average daily amount of such Lender’s LC Exposure (excluding any portion thereof attributable to Reimbursement Obligations) during the period from and including the Closing Date to but excluding the later of the date on which such Lender’s Revolving Commitment terminates and the date on which such Lender ceases to have any LC Exposure, and (ii) to the Issuing Bank a fronting fee (“Fronting Fee”), which shall accrue at the rate of 0.25% per annum on the average daily amount of the LC Exposure (excluding any portion thereof attributable to Reimbursement Obligations), or, if greater, a flat fee of $1000 per annum,  during the period from and including the Closing Date to but excluding the later of the date of termination of the Revolving Commitments and the date on which there ceases to be any LC Exposure, as well as the Issuing Bank’s customary fees with respect to the issuance, amendment, renewal or extension of any Letter of Credit or processing of drawings thereunder, which, for as long as UBS AG, Stamford Branch is the Issuing Bank, will include an issuance fee of $500 per Letter of Credit, additional drawing fees of $250.00 per draw, amendment fees of $200 per amendment and $250 for renewals on each anniversary of an Auto-Renewal Letter of Credit.  Accrued LC Participation Fees and Fronting Fees shall be payable in arrears (i) on the last Business Day of March, June, September and December of each year, commencing on the first such date to occur after the Closing Date, and (ii) on the date on which the Revolving Commitments terminate.  Any such fees accruing after the date on which the Revolving Commitments terminate shall be payable on demand.  Fees payable to UBS AG, Stamford Branch, as Issuing Bank, shall be paid to Issuing Bank in immediately available funds no later than 11:00 am (New York Time) on the due date thereof pursuant to wiring information provided separately to Borrower by UBS AG, Stamford Branch.  Any other fees payable to the Issuing Bank pursuant to this paragraph shall be payable within 10 days after demand therefor.  All LC Participation Fees and Fronting Fees shall be computed on the basis of a year of 360 days and shall be payable for the actual number of days elapsed (including the first day but excluding the last day).  All amounts paid pursuant to this Section 2.05(c) shall be non-refundable.

(d)           All Fees shall be paid on the dates due, in immediately available funds, to the Administrative Agent for distribution, if and as appropriate, among the Lenders, except that Borrower shall pay the Fronting Fees directly to the Issuing Bank.  None of the Fees shall be refundable under any circumstances.

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SECTION 2.06              Interest on Loans.

(a)           ABR Loans.  Subject to the provisions of Section 2.06(c), the Loans comprising each ABR Borrowing, including each Swingline Loan, shall bear interest at a rate per annum equal to the Alternate Base Rate plus the Applicable Margin in effect from time to time.

(b)           Eurodollar Loans.  Subject to the provisions of Section 2.06(c), the Loans comprising each Eurodollar Borrowing shall bear interest at a rate per annum equal to the Adjusted LIBOR Rate for the Interest Period in effect for such Borrowing plus the Applicable Margin in effect from time to time.

(c)           Default Rate.  Notwithstanding the foregoing, if there is an Event of Default pursuant to Section 8.01(a), (b), (g) or (h), then the Obligations shall, to the extent permitted by applicable law, bear interest, after as well as before judgment, at a rate per annum equal to (i) in the case of amounts constituting principal on any Loan, 2% plus the rate otherwise applicable to such Loan as provided in the preceding paragraphs of this Section 2.06 or (ii) in the case of any other outstanding amount, 2% plus the rate applicable to ABR Revolving Loans as provided in Section 2.06(a) (in either case, the “Default Rate”).

(d)           Interest Payment Dates.  Accrued interest on each Loan shall be payable in arrears on each Interest Payment Date for such Loan; provided that (i) interest accrued pursuant to Section 2.06(c) shall be payable on demand, (ii) in the event of any repayment or prepayment of any Loan (other than a prepayment of an ABR Revolving Loan or a Swingline Loan without a permanent reduction in Revolving Commitments), accrued interest on the principal amount repaid or prepaid shall be payable on the date of such repayment or prepayment and (iii) in the event of any conversion of any Eurodollar Loan prior to the end of the current Interest Period therefor, accrued interest on such Loan shall be payable on the effective date of such conversion.

(e)           Interest Calculation.  All interest hereunder shall be computed on the basis of a year of 360 days, except that interest computed by reference to the Alternate Base Rate shall be computed on the basis of a year of 365 days (or 366 days in a leap year), and in each case shall be payable for the actual number of days elapsed (including the first day but excluding the last day).  The applicable Alternate Base Rate or Adjusted LIBOR Rate shall be determined by the Administrative Agent in accordance with the provisions of this Agreement and such determination shall be conclusive absent manifest error.

SECTION 2.07              Termination and Reduction of Commitments.

(a)           Termination of Commitments.  The Term B Loan Commitments shall automatically terminate at 5:00 p.m., New York City time, on the Closing Date.  The Revolving Commitments, the Swingline Commitment and the LC Commitment shall automatically terminate on the Revolving Maturity Date.  Notwithstanding the foregoing, all the Commitments shall automatically terminate at 5:00 p.m., New York City time, on April 15, 2011, if the initial Credit Extension shall not have occurred by such time.

(b)           Optional Terminations and Reductions.  At its option, Borrower may at any time terminate, or from time to time permanently reduce, the Commitments of any Class; provided that (i) each reduction of the Commitments of any Class shall be in an amount that is an integral

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multiple of $250,000 and not less than $250,000 and (ii) the Revolving Commitments shall not be terminated or reduced if, after giving effect to any concurrent prepayment of the Revolving Loans in accordance with Section 2.10, the aggregate amount of Revolving Exposures would exceed the aggregate amount of Revolving Commitments.

(c)           Borrower Notice.  Borrower shall notify the Administrative Agent in writing of any election to terminate or reduce the Commitments under Section 2.07(b) at least three Business Days prior to the effective date of such termination or reduction, specifying such election and the effective date thereof.  Promptly following receipt of any notice, the Administrative Agent shall advise the Lenders of the contents thereof.  Each notice delivered by Borrower pursuant to this Section 2.07(c) shall be irrevocable; provided that a notice of termination of the Commitments delivered by Borrower may state that such notice is conditioned upon the effectiveness of another credit facility or the closing of a securities offering, in which case such notice may be revoked by Borrower (by notice to the Administrative Agent on or prior to the specified effective date) if such condition is not satisfied.  Any termination or reduction of the Commitments of any Class shall be permanent.  Each reduction of the Commitments of any Class shall be made ratably among the Lenders in accordance with their respective Commitments of such Class.

SECTION 2.08              Interest Elections.

(a)           Generally.  Each Revolving Borrowing and Term Borrowing initially shall be of the Type specified in the applicable Borrowing Request and, in the case of a Eurodollar Borrowing, shall have an initial Interest Period as specified in such Borrowing Request.  Thereafter, Borrower may elect to convert such Borrowing to a different Type or to continue such Borrowing and, in the case of a Eurodollar Borrowing, may elect Interest Periods therefor, all as provided in this Section 2.08.  Borrower may elect different options with respect to different portions of the affected Borrowing, in which case each such portion shall be allocated ratably among the Lenders holding the Loans comprising such Borrowing, and the Loans comprising each such portion shall be considered a separate Borrowing.  This Section 2.08 shall not apply to Swingline Borrowings, which may not be converted or continued.

(b)           Interest Election Notice.  To make an election pursuant to this Section 2.08(b), Borrower shall deliver, by hand delivery or facsimile or e-mail, a duly completed and executed Interest Election Request to the Administrative Agent not later than the time that a Borrowing Request would be required under Section 2.03 if Borrower were requesting Loans of the Type resulting from such election to be made on the effective date of such election.  Each Interest Election Request shall be irrevocable.  Each Interest Election Request shall specify the following information in compliance with Section 2.02:

(i)            the Borrowing to which such Interest Election Request applies and, if different options are being elected with respect to different portions thereof, or if outstanding Borrowings are being combined, allocation to each resulting Borrowing (in which case the information to be specified pursuant to clauses (iii) and (iv) below shall be specified for each resulting Borrowing);

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(ii)           the effective date of the election made pursuant to such Interest Election Request, which shall be a Business Day;

(iii)          whether the resulting Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing; and

(iv)          if the resulting Borrowing is a Eurodollar Borrowing, the Interest Period to be applicable thereto after giving effect to such election, which shall be a period contemplated by the definition of the term “Interest Period”; provided that prior to the earlier of (i) the date that is 90 days after the Closing Date and (ii) the date the completion of the primary syndication of the Commitments and Loans (as determined by the Arranger), the Interest Period shall be one month.

If any such Interest Election Request requests a Eurodollar Borrowing but does not specify an Interest Period, then Borrower shall be deemed to have selected an Interest Period of one month’s duration.

Promptly following receipt of an Interest Election Request, the Administrative Agent shall advise each Lender of the details thereof and of such Lender’s portion of each resulting Borrowing.

(c)           Automatic Conversion to ABR Borrowing.  If an Interest Election Request with respect to a Eurodollar Borrowing is not timely delivered prior to the end of the Interest Period applicable thereto, then, unless such Borrowing is repaid as provided herein, at the end of such Interest Period such Borrowing shall be converted to an ABR Borrowing.  Notwithstanding any contrary provision hereof, if an Event of Default has occurred and is continuing, the Administrative Agent or the Required Lenders may require, by notice to Borrower, that (i) no outstanding Borrowing may be converted to or continued as a Eurodollar Borrowing and (ii) unless repaid, each Eurodollar Borrowing shall be converted to an ABR Borrowing at the end of the Interest Period applicable thereto.

SECTION 2.09              Amortization of Term Borrowings.

Borrower shall pay to the Administrative Agent, for the account of the Term B Loan Lenders and the Incremental Term Loan Lenders, on the dates set forth on Annex I or the applicable Increase Joinder, respectively, or if any such date is not a Business Day, on the immediately preceding Business Day (each such date, a “Term Loan Repayment Date”), a principal amount of the Term B Loans and Incremental Term Loans (if any), respectively, equal to the amount set forth on Annex I or the applicable Increase Joinder, respectively, for such date (as adjusted from time to time pursuant to Section 2.10(g)), together in each case with accrued and unpaid interest on the principal amount to be paid to but excluding the date of such payment.  To the extent not previously paid, all Term B Loans shall be due and payable on the Term B Loan Maturity Date and all Incremental Term Loans shall be due and payable on the applicable Incremental Term Loan Maturity Date.

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SECTION 2.10              Optional and Mandatory Prepayments of Loans.

(a)           Optional Prepayments.  Borrower shall have the right at any time and from time to time to prepay any Borrowing, in whole or in part, without premium or penalty, subject to the requirements of this Section 2.10; provided that each partial prepayment shall be in an amount that is an integral multiple of $500,000 and not less than $1,000,000 or, if less, the outstanding principal amount of such Borrowing.

(b)           Revolving Loan Prepayments.

(i)            In the event of the termination of all the Revolving Commitments, Borrower shall, on the date of such termination, repay or prepay all its outstanding Revolving Borrowings and all outstanding Swingline Loans and replace all outstanding Letters of Credit or cash collateralize all outstanding Letters of Credit in accordance with the procedures set forth in Section 2.18(i).

(ii)           In the event of any partial reduction of the Revolving Commitments, then (x) at or prior to the effective date of such reduction, the Administrative Agent shall notify Borrower and the Revolving Lenders of the sum of the Revolving Exposures after giving effect thereto and (y) if the sum of the Revolving Exposures would exceed the aggregate amount of Revolving Commitments after giving effect to such reduction, then Borrower shall, on the date of such reduction, first, repay or prepay Swingline Loans, second, repay or prepay Revolving Borrowings and third, replace outstanding Letters of Credit or cash collateralize outstanding Letters of Credit in accordance with the procedures set forth in Section 2.18(i), in an aggregate amount sufficient to eliminate such excess.

(iii)          In the event that the sum of all Lenders’ Revolving Exposures exceeds the Revolving Commitments then in effect, Borrower shall, without notice or demand, immediately first, repay or prepay Swingline Loans, second, repay or prepay Revolving Borrowings, and third, replace outstanding Letters of Credit or cash collateralize outstanding Letters of Credit in accordance with the procedures set forth in Section 2.18(i), in an aggregate amount sufficient to eliminate such excess.

(iv)          In the event that the aggregate LC Exposure exceeds the LC Commitment then in effect, Borrower shall, without notice or demand, immediately replace outstanding Letters of Credit or cash collateralize outstanding Letters of Credit in accordance with the procedures set forth in Section 2.18(i), in an aggregate amount sufficient to eliminate such excess.

(v)           In the event that the aggregate Swingline Exposure exceeds the Swingline Commitment then in effect, Borrower shall, without notice or demand, immediately repay or prepay Swingline Loans in an aggregate amount sufficient to eliminate such excess.

(c)           Asset Sales.  Not later than five Business Days following the receipt of any Net Cash Proceeds of any Asset Sale by Holdings or any of its Restricted Subsidiaries, Borrower shall make prepayments without premium or penalty in accordance with Sections 2.10(g) and (h) in an aggregate amount equal to 100% of such Net Cash Proceeds; provided that:

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(i)            no such prepayment shall be required under this Section 2.10(c) with respect to (A) any Asset Sale permitted by Section 6.06(a), (c), (d), (e), (f), (h), (j), (k) or (l), (B) the disposition of property which constitutes a Casualty Event, or (C) any Asset Sales made by any Foreign Restricted Subsidiary to the extent that (1) the Net Cash Proceeds of all such Asset Sales of all Foreign Restricted Subsidiaries together with the Net Cash Proceeds of Casualty Events described in Section 2.10(e)(i)(y)(A) do not exceed $15,000,000 in the aggregate during the term of this Agreement, (2) local Requirements of Law prohibit such Foreign Restricted Subsidiary from making payment of the Net Cash Proceeds of such Asset Sale to the Loan Parties, whether through the repayment of intercompany loans, dividends or otherwise (provided that to the extent any such Requirements of Law permit such payments at a later time, such prepayment shall be required within five Business Days thereafter) or (3) Borrower determines in good faith that repatriation to the United States of any such Net Cash Proceeds of an Asset Sale by a Foreign Restricted Subsidiary would have a material adverse tax consequence with respect to such funds (provided that if such funds are so repatriated by such Foreign Restricted Subsidiary, such repatriated funds will be promptly applied (net of additional taxes payable or reserved against as a result thereof) to the prepayment pursuant to Section 2.10(g)); and

(ii)           so long as no Default shall then exist or would arise therefrom, such proceeds shall not be required to be so applied on such date to the extent that such Net Cash Proceeds are expected to be reinvested, or committed to be reinvested, in fixed or capital assets within 12 months following the date of such Asset Sale; provided that if all or any portion of such Net Cash Proceeds is not so reinvested within such 12-month period (or if the Loan Parties have entered into binding contractual commitments for reinvestment within such 12-month period, not so reinvested within 18 months following the date of such Asset Sale), such unused portion shall be applied on the last day of such period as a mandatory prepayment as provided in this Section 2.10(c); provided, further, that if the property subject to such Asset Sale constituted Collateral, then all property purchased with the Net Cash Proceeds thereof pursuant to this subsection shall be made subject to the Lien of the applicable Security Documents in favor of the Collateral Agent, for its benefit and for the benefit of the other Secured Parties in accordance with Sections 5.11 and 5.12.

(d)           Debt Issuance or Disqualified Capital Stock Issuance.  Not later than one Business Day following the receipt of any Net Cash Proceeds of any Debt Issuance or issuance of Disqualified Capital Stock by Holdings or any of its Restricted Subsidiaries, Borrower shall make prepayments without premium or penalty in accordance with Sections 2.10(g) and (h) in an aggregate amount equal to 100% of such Net Cash Proceeds.

(e)           Casualty Events.  Not later than five Business Days following the receipt of any Net Cash Proceeds from a Casualty Event by Holdings or any of its Restricted Subsidiaries, Borrower shall make prepayments without premium or penalty in accordance with Sections 2.10(g) and (h) in an aggregate amount equal to 100% of such Net Cash Proceeds; provided that:

(i)            no such prepayment shall be required under this Section 2.10(e) with respect to any Casualty Event (x) to the extent such Casualty Event (together with any

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related Casualty Events) result in Net Cash Proceeds of $500,000 or less or (y) with respect to an asset of any Foreign Restricted Subsidiary to the extent that (A) the Net Cash Proceeds of all such Casualty Events of all Foreign Restricted Subsidiaries together with the Net Cash Proceeds of Asset Sales described in Section 2.10(c)(i)(C)(1) do not exceed $15,000,000 in the aggregate during the term of this Agreement, (B) local Requirements of Law prohibit such Foreign Restricted Subsidiary from making payment of the Net Cash Proceeds of such Casualty Event to the Loan Parties, whether through the repayment of intercompany loans, dividends or otherwise (provided that to the extent any such Requirements of Law permit such payments at a later time, such prepayment shall be required within five Business Days thereafter) or (C) Borrower determines in good faith that repatriation to the United States of any such Net Cash Proceeds of a Casualty Event of a Foreign Restricted Subsidiary would have a material adverse tax consequence with respect to such funds (provided that if such funds are so repatriated by such Foreign Restricted Subsidiary, such repatriated funds will be promptly applied (net of additional taxes payable or reserved against as a result thereof) to the prepayment pursuant to Section 2.10(g));

(ii)           so long as no Default shall then exist or arise therefrom, such proceeds shall not be required to be so applied on such date to the extent that such proceeds are expected to be used to repair, replace or restore any property in respect of which such Net Cash Proceeds were paid or to be reinvested in other fixed or capital assets to be used in Borrower’s business, or committed to be so used or reinvested, no later than 12 months following the date of receipt of such proceeds; provided that if all or any portion of such proceeds is not so used or reinvested within such 12-month period (or if the Loan Parties have entered into binding contractual commitments for reinvestment within such 12-month period, not so used or reinvested within 18 months following the date of such Casualty Event), such unused portion shall be applied on the last day of such period as a mandatory prepayment as provided in this Section 2.10(e); provided, further, that if the property subject to such Casualty Event constituted Collateral under the Security Documents, then all property purchased with the Net Cash Proceeds thereof pursuant to this subsection shall be made subject to the Lien of the applicable Security Documents in favor of the Collateral Agent, for its benefit and for the benefit of the other Secured Parties in accordance with Sections 5.11 and 5.12; and

(iii)          if any portion of such Net Cash Proceeds shall not be so applied within such 12-month period (or if the Loan Parties have entered into binding contractual commitments for such application within such 12-month period, shall not be so applied within 18 months following the date of receipt of such proceeds), such unused portion shall be applied on the last day of such period as a mandatory prepayment as provided in this Section 2.10(e).

(f)            Excess Cash Flow.  No later than five Business Days after the date on which the financial statements with respect to each fiscal year in which an Excess Cash Flow Period occurs are or are required to be delivered pursuant to Section 5.01(a) (without giving effect to any grace period applicable thereto), Borrower shall make prepayments without premium or penalty in accordance with Sections 2.10(g) and (h) in an aggregate amount equal to (A) the Applicable ECF Percentage of Excess Cash Flow for the Excess Cash Flow Period then ended minus (B) any

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voluntary prepayments of Term Loans pursuant to Section 2.10(a) during such Excess Cash Flow Period and any voluntary prepayments of Revolving Loans pursuant to Section 2.10(a) during such Excess Cash Flow Period to the extent accompanied by equivalent permanent reductions of the Revolving Commitments pursuant to Section 2.07(b), other than prepayments of Term Loans or Revolving Loans funded with the proceeds of Indebtedness.

(g)           Application of Prepayments.  Mandatory prepayments shall be applied, first, to any Term Loans outstanding and, second, after the Term Loans outstanding have been prepaid in full, to the Revolving Loans outstanding, without any reduction of the Revolving Commitments, and third to cash collateralize all outstanding Letters of Credit in accordance with the procedures set forth in Section 2.18(i), without any reduction of the Revolving Commitments.  Prior to any optional or mandatory prepayment hereunder, Borrower shall select the Borrowing or Borrowings to be prepaid and shall specify such selection in the notice of such prepayment pursuant to Section 2.10(h), subject to the provisions of this Section 2.10(g).  In the event of any optional or mandatory prepayment of Term Borrowings made at a time when Term Borrowings of more than one Class remain outstanding, the aggregate amount of such prepayment shall be allocated between the Term B Loans and each other Class of Incremental Term Loans pro rata based on the aggregate principal amount of outstanding Borrowings of each such Class.  Notwithstanding the foregoing any Term Loan Lender may elect, by written notice to the Administrative Agent at least one Business Day prior to the prepayment date, to decline all or any portion of any mandatory prepayment of its Term Loans, pursuant to this Section 2.10, in which case the aggregate amount of the prepayment that would have been applied to prepay such Term Loans, but was so declined shall be ratably offered to each Term Loan Lender that initially accepted such mandatory prepayment.  Any amounts rejected by such Lenders shall be retained by or repaid to Borrower.  Any prepayments of Term Loans of any Class (i) pursuant to Section 2.10(c), (d), (e) or (f) shall be applied to reduce scheduled repayments required under Section 2.09, first, in direct order to such scheduled repayments due on the next eight Term Loan Repayment Dates for such Class of Term Loans occurring following such prepayment and, second, on a pro rata basis among the repayments remaining to be made on each other Term Loan Repayment Date for such Class of Term Loans or (ii) pursuant to Section 2.10(a) shall be applied as directed by Borrower.

Amounts to be applied pursuant to this Section 2.10 to the prepayment of Term Loans and Revolving Loans shall be applied, as applicable, first to reduce outstanding ABR Term Loans and ABR Revolving Loans, respectively.  Any amounts remaining after each such application shall be applied to prepay Eurodollar Term Loans or Eurodollar Revolving Loans, as applicable.  Notwithstanding the foregoing, if the amount of any prepayment of Loans required under this Section 2.10 shall be in excess of the amount of the ABR Loans at the time outstanding (an “Excess Amount”), then, at the election of Borrower only the portion of the amount of such prepayment as is equal to the amount of such outstanding ABR Loans shall be immediately prepaid and the Excess Amount shall be either (A) deposited in an escrow account on terms reasonably satisfactory to the Collateral Agent and applied to the prepayment of Eurodollar Loans on the last day of the then next-expiring Interest Period for Eurodollar Loans; provided that (i) interest in respect of such Excess Amount shall continue to accrue thereon at the rate provided hereunder for the Loans which such Excess Amount is intended to repay until such Excess Amount shall have been used in full to repay such Loans and (ii) at any time while an Event of Default has occurred and is continuing, the Administrative Agent may, and upon written direction from the Required Lenders shall, apply any or all proceeds then on deposit to the payment of

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such Loans in an amount equal to such Excess Amount or (B) prepaid immediately, together with any amounts owing to the Lenders under Section 2.13.

(h)           Notice of Prepayment.  Borrower shall notify the Administrative Agent (and, in the case of prepayment of a Swingline Loan, the Swingline Lender) by written notice of any prepayment hereunder (i) in the case of prepayment of a Eurodollar Borrowing, not later than 11:00 a.m., New York City time, three Business Days before the date of prepayment, (ii) in the case of prepayment of an ABR Borrowing, not later than 12:00 noon, New York City time, one Business Day before the date of prepayment and (iii) in the case of prepayment of a Swingline Loan, not later than 12:00 noon, New York City time, on the date of prepayment.  Each such notice shall be irrevocable; provided that a notice of prepayment delivered by Borrower may state that such notice is conditioned upon the effectiveness of debt or equity financing, in which case such notice may be revoked by Borrower (by notice to the Administrative Agent on or prior to the specified prepayment date) if such condition is not satisfied.  Each such notice shall specify the prepayment date, the principal amount of each Borrowing or portion thereof to be prepaid and, in the case of a mandatory prepayment, a reasonably detailed calculation of the amount of such prepayment.  Promptly following receipt of any such notice (other than a notice relating solely to Swingline Loans), the Administrative Agent shall advise the Lenders of the contents thereof.  Each partial prepayment of any Borrowing shall be in an amount that would be permitted in the case of a Credit Extension of the same Type as provided in Section 2.02, except as necessary to apply fully the required amount of a mandatory prepayment.  Each prepayment of a Borrowing shall be applied ratably to the Loans included in the prepaid Borrowing and otherwise in accordance with this Section 2.10.  Prepayments shall be accompanied by accrued interest to the extent required by Section 2.06.

SECTION 2.11              Alternate Rate of Interest.

If prior to the commencement of any Interest Period for a Eurodollar Borrowing:

(a)           the Administrative Agent determines (which determination shall be final and conclusive absent manifest error) that adequate and reasonable means do not exist for ascertaining the Adjusted LIBOR Rate for such Interest Period; or

(b)           the Administrative Agent is advised in writing by the Required Lenders that the Adjusted LIBOR Rate for such Interest Period will not adequately and fairly reflect the cost to such Lenders of making or maintaining their Loans included in such Borrowing for such Interest Period;

then the Administrative Agent shall give written notice thereof to Borrower and the Lenders as promptly as practicable thereafter and, until the Administrative Agent notifies Borrower and the Lenders that the circumstances giving rise to such notice no longer exist, (i) any Eurodollar Borrowing requested to be made on the first day of such Interest Period shall be made as a Market Disruption Loan, (ii) any Borrowing that were to have been converted on the first day of such Interest Period to a Eurodollar Borrowing shall be continued as a Market Disruption Loan and (iii) any outstanding Eurodollar Borrowing shall be converted, on the last day of the then-current Interest Period, to a Market Disruption Loan.

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SECTION 2.12              Yield Protection.

(a)           Increased Costs Generally. If any Change in Law shall:

(i)            impose, modify or deem applicable any reserve, special deposit, compulsory loan, insurance charge or similar requirement against assets of, deposits with or for the account of, or credit extended or participated in, by any Lender (except any reserve requirement reflected in the Adjusted LIBOR Rate) or the Issuing Bank;

(ii)           subject any Lender or the Issuing Bank to any tax of any kind whatsoever with respect to this Agreement, any Letter of Credit, any participation in a Letter of Credit or any Loan made by it, or change the basis of taxation of payments to such Lender or the Issuing Bank in respect thereof (except for Indemnified Taxes or Other Taxes indemnifiable under Section 2.15 and the imposition of, or change in the rate of, any Excluded Tax); or

(iii)          impose on any Lender or the Issuing Bank or the London interbank market any other condition, cost or expense affecting this Agreement or Eurodollar Loans made by such Lender or any Letter of Credit or participation therein;

and the result of any of the foregoing shall be to increase the cost to such Lender of making or maintaining any Eurodollar Loan (or of maintaining its obligation to make any such Loan), or to increase the cost to such Lender, the Issuing Bank or such Lender’s or the Issuing Bank’s holding company, if any, of participating in, issuing or maintaining any Letter of Credit (or of maintaining its obligation to participate in or to issue any Letter of Credit), or to reduce the amount of any sum received or receivable by such Lender or the Issuing Bank hereunder (whether of principal, interest or any other amount), then, upon request of such Lender or the Issuing Bank, Borrower will pay to such Lender or the Issuing Bank, as the case may be, such additional amount or amounts as will compensate such Lender or the Issuing Bank, as the case may be, for such additional costs incurred or reduction suffered, it being understood that to the extent duplicative of the provisions of Section 2.15, this Section 2.12 shall not apply to Taxes.

(b)           Capital Requirements.  If any Lender or the Issuing Bank determines (in good faith, but in its sole discretion) that any Change in Law affecting such Lender or the Issuing Bank or any lending office of such Lender or such Lender’s or the Issuing Bank’s holding company, if any, regarding capital requirements has or would have the effect of reducing the rate of return on such Lender’s or the Issuing Bank’s capital or on the capital of such Lender’s or the Issuing Bank’s holding company, if any, as a consequence of this Agreement, the Commitments of such Lender or the Loans made by, or participations in Letters of Credit held by, such Lender, or the Letters of Credit issued by the Issuing Bank, to a level below that which such Lender or the Issuing Bank or such Lender’s or the Issuing Bank’s holding company could have achieved but for such Change in Law (taking into consideration such Lender’s or the Issuing Bank’s policies and the policies of such Lender’s or the Issuing Bank’s holding company with respect to capital adequacy), then from time to time Borrower will pay to such Lender or the Issuing Bank, as the case may be, such additional amount or amounts as will compensate such Lender or the Issuing Bank or such Lender’s or the Issuing Bank’s holding company for any such reduction suffered.

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(c)Certificates for Reimbursement.  A certificate of a Lender or the Issuing Bank setting forth in reasonable detail the basis for its claim and the amount or amounts necessary to compensate such Lender or the Issuing Bank or its holding company, as the case may be, as specified in paragraph (a) or (b) of this Section 2.12 and delivered to Borrower shall be prima facie evidence.  Borrower shall pay such Lender or the Issuing Bank, as the case may be, the amount shown as due on any such certificate within ten days after receipt thereof.

(d)Delay in Requests.  Failure or delay on the part of any Lender or the Issuing Bank to demand compensation pursuant to this Section 2.12 shall not constitute a waiver of such Lender’s or the Issuing Bank’s right to demand such compensation; provided that Borrower shall not be required to compensate a Lender or the Issuing Bank pursuant to this Section 2.12 for any increased costs incurred or reductions suffered more than six months prior to the date that such Lender or the Issuing Bank, as the case may be, notifies Borrower of the Change in Law giving rise to such increased costs or reductions and of such Lender’s or the Issuing Bank’s intention to claim compensation therefor (except that, if the Change in Law giving rise to such increased costs or reductions is retroactive, then the six-month period referred to above shall be extended to include the period of retroactive effect thereof) .

SECTION 2.13Breakage Payments.

In the event of (a) the payment or prepayment, whether optional or mandatory, of any principal of any Eurodollar Loan earlier than the last day of an Interest Period applicable thereto (including as a result of an Event of Default), (b) the conversion of any Eurodollar Loan earlier than the last day of the Interest Period applicable thereto, (c) the failure to borrow, convert, continue or prepay any Revolving Loan or Term Loan on the date specified in any notice delivered pursuant hereto, (d) the assignment of any Eurodollar Loan earlier than the last day of the Interest Period applicable thereto as a result of a request by Borrower pursuant to Section 2.16(b), or (e) prior to the date that is 90 days after the Closing Date, any assignment of any Eurodollar Loan earlier than the last day of the Interest Period applicable thereto, then, in any such event, Borrower shall compensate each Lender for the loss, cost and expense attributable to such event (excluding loss of anticipated profit related to any interest margin on such amount).  In the case of a Eurodollar Loan, such loss, cost or expense to any Lender shall be deemed to include an amount determined by such Lender to be the excess, if any, of (i) the amount of interest which would have accrued on the principal amount of such Loan had such event not occurred, at the Adjusted LIBOR Rate that would have been applicable to such Loan, for the period from the date of such event to the last day of the then current Interest Period therefor (or, in the case of a failure to borrow, convert or continue, for the period that would have been the Interest Period for such Loan), over (ii) the amount of interest which would accrue on such principal amount for such period at the interest rate which such Lender would bid were it to bid, at the commencement of such period, for dollar deposits of a comparable amount and period from other banks in the Eurodollar market.  A certificate of any Lender setting forth in reasonable detail any amount or amounts that such Lender is entitled to receive pursuant to this Section 2.13 shall be delivered to Borrower (with a copy to the Administrative Agent) and shall be prima facie evidence of the amount thereof.  Borrower shall pay such Lender the amount shown as due on any such certificate within 10 days after receipt thereof.

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SECTION 2.14Payments Generally; Pro Rata Treatment; Sharing of Setoffs.

(a)Payments Generally.  Borrower shall make each payment required to be made by it hereunder or under any other Loan Document (whether of principal, interest, fees or Reimbursement Obligations, or of amounts payable under Section 2.12, 2.13, 2.15 or 10.03, or otherwise) on or before the time expressly required hereunder or under such other Loan Document for such payment (or, if no such time is expressly required, prior to 3:00 p.m., New York City time), on the date when due, in immediately available funds, without setoff, deduction or counterclaim.  Any amounts received after such time on any date may, in the discretion of the Administrative Agent, be deemed to have been received on the next succeeding Business Day for purposes of calculating interest thereon.  All such payments shall be made to the Administrative Agent at its offices at Stamford, Connecticut, except payments to be made directly to the Issuing Bank or Swingline Lender as expressly provided herein and except that payments pursuant to Sections 2.12, 2.13, 2.15 and 10.03 shall be made directly to the persons entitled thereto and payments pursuant to other Loan Documents shall be made to the persons specified therein.  The Administrative Agent shall distribute any such payments received by it for the account of any other person to the appropriate recipient promptly following receipt thereof.  If any payment under any Loan Document shall be due on a day that is not a Business Day, unless specified otherwise, the date for payment shall be extended to the next succeeding Business Day, and, in the case of any payment accruing interest, interest thereon shall be payable for the period of such extension.  All payments under each Loan Document shall be made in dollars, except as expressly specified otherwise.

(b)Pro Rata Treatment.

(i)Subject to Section 2.19, each payment by Borrower of interest in respect of the Loans shall be applied to the amounts of such obligations owing to the Lenders pro rata according to the respective amounts then due and owing to the Lenders.

(ii)Subject to Section 2.19, each payment on account of principal of the Term B Loans shall be allocated among the Term B Loan Lenders pro rata based on the principal amount of the Term B Loans held by the Term B Loan Lenders.  Each payment on account of principal of any Class of Incremental Term Loans shall be allocated among the Incremental Term Loan Lenders for such Class pro rata based on the principal amount of the Incremental Term Loans in such Class held by the Incremental Term Loan Lenders.  Each payment by Borrower on account of principal of the Revolving Borrowings shall be made pro rata according to the respective outstanding principal amounts of the Revolving Loans then held by the Revolving Lenders.

(c)Insufficient Funds.  If at any time insufficient funds are received by and available to the Administrative Agent to pay fully all amounts of principal, Reimbursement Obligations, interest and fees then due hereunder, such funds shall be applied (i) first, toward payment of interest and fees then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of interest and fees then due to such parties, and (ii) second, toward payment of principal and Reimbursement Obligations then due hereunder, ratably among the parties entitled thereto in accordance with the amounts of principal and Reimbursement Obligations then due to such parties.  It is understood that the foregoing does not apply to any adequate protection payments

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under any federal, state or foreign bankruptcy, insolvency, receivership or similar proceeding, and that the Administrative Agent may, subject to any applicable federal, state or foreign bankruptcy, insolvency, receivership or similar orders, distribute any adequate protection payments it receives on behalf of the Lenders to the Lenders in its sole discretion (i.e., whether to pay the earliest accrued interest, all accrued interest on a pro rata basis or otherwise).

(d)Sharing of Set-Off; Sharing of Proceeds.  If any Lender (and/or the Issuing Bank, which shall be deemed a “Lender” for purposes of this Section 2.14(d)) shall, by exercising any right of setoff or counterclaim, by exercising any rights or remedies pursuant to any California Mortgage with respect to Account Collateral (as defined in such California Mortgage) including by exercise of remedies pursuant to Section 2.5 of such California Mortgage or otherwise, obtain payment in respect of any principal of or interest on any of its Loans or other Obligations resulting in such Lender’s receiving payment of a proportion of the aggregate amount of its Loans and accrued interest thereon or other Obligations greater than its pro rata share thereof as provided herein, then the Lender receiving such greater proportion shall (a) notify the Administrative Agent of such fact, and (b) purchase (for cash at face value) participations in the Loans and such other obligations of the other Lenders, or make such other adjustments as shall be equitable, so that the benefit of all such payments shall be shared by the Lenders ratably in accordance with the aggregate amount of principal of and accrued interest on their respective Loans and other amounts owing them, provided that:

(i)if any such participations are purchased and all or any portion of the payment giving rise thereto is recovered, such participations shall be rescinded and the purchase price restored to the extent of such recovery, without interest; and

(ii)the provisions of this paragraph shall not be construed to apply to (x) any payment made by Borrower pursuant to and in accordance with the express terms of this Agreement or (y) any payment obtained by a Lender as consideration for the assignment of or sale of a participation in any of its Loans or participations in LC Disbursements to any assignee or participant, other than to Holdings or any Subsidiary thereof (as to which the provisions of this paragraph (d) shall apply).

Each Loan Party consents to the foregoing and agrees, to the extent it may effectively do so under applicable Requirements of Law, that any Lender acquiring a participation pursuant to the foregoing arrangements may exercise against such Loan Party rights of setoff and counterclaim (and the remedies provided for in each California Mortgage with respect to the Account Collateral identified therein) with respect to such participation as fully as if such Lender were a direct creditor of such Loan Party in the amount of such participation.  If under applicable bankruptcy, insolvency or any similar law any Secured Party receives a secured claim in lieu of a setoff or counterclaim to which this Section 2.14(d) applies, such Secured Party shall to the extent practicable, exercise its rights in respect of such secured claim in a manner consistent with the rights to which the Secured Party is entitled under this Section 2.14(d) to share in the benefits of the recovery of such secured claim.

(e)Borrower Default.  Unless the Administrative Agent shall have received notice from Borrower prior to the date on which any payment is due to the Administrative Agent for the account of the Lenders or the Issuing Bank hereunder that Borrower will not make such payment,

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the Administrative Agent may assume that Borrower has made such payment on such date in accordance herewith and may, in reliance upon such assumption, distribute to the Lenders or the Issuing Bank, as the case may be, the amount due.  In such event, if Borrower has not in fact made such payment, then each of the Lenders or the Issuing Bank, as the case may be, severally agrees to repay to the Administrative Agent forthwith on demand the amount so distributed to such Lender or the Issuing Bank with interest thereon, for each day from and including the date such amount is distributed to it to but excluding the date of payment to the Administrative Agent, at the greater of the Federal Funds Effective Rate and a rate determined by the Administrative Agent in accordance with banking industry rules on interbank compensation.

SECTION 2.15Taxes.

(a)Payments Free of Taxes.  Any and all payments by or on account of any obligation of the Loan Parties hereunder or under any other Loan Document shall be made free and clear of and without reduction or withholding for any Indemnified Taxes or Other Taxes; provided that if the applicable withholding agent shall be required by applicable Requirements of Law (as determined in the good faith discretion of the applicable withholding agent) to deduct any Indemnified Taxes (including any Other Taxes) from such payments, then (i) the sum payable shall be increased by the Loan Parties as necessary so that after all required deductions have been made (including deductions applicable to additional sums payable under this Section 2.15) the Administrative Agent or Lender, as the case may be, receives an amount equal to the sum it would have received had no such deductions been made, (ii) the applicable withholding agent shall make such deductions and (iii) the applicable withholding agent shall timely pay the full amount deducted to the relevant Governmental Authority in accordance with applicable Requirements of Law.

(b)Payment of Other Taxes by Borrower.  Without limiting the provisions of paragraph (a) above, Borrower shall timely pay any Other Taxes to the relevant Governmental Authority in accordance with applicable Requirements of Law.

(c)Indemnification by Borrower.  Borrower shall indemnify the Administrative Agent and each Lender, within ten days after written demand therefor, for the full amount of any Indemnified Taxes or Other Taxes (including Indemnified Taxes or Other Taxes imposed or asserted on or attributable to amounts payable under this Section 2.15) payable by the Administrative Agent or such Lender, as the case may be, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes or Other Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority.  A certificate as to the amount of such payment or liability delivered to Borrower by a Lender (with a copy to the Administrative Agent), or by the Administrative Agent on its own behalf or on behalf of a Lender, shall be conclusive absent manifest error.

(d)Evidence of Payments.  As soon as practicable after any payment of Indemnified Taxes or Other Taxes by Borrower to a Governmental Authority, Borrower shall deliver to the Administrative Agent the original or a certified copy of a receipt issued by such Governmental Authority evidencing such payment, a copy of the return reporting such payment or other evidence of such payment reasonably satisfactory to the Administrative Agent.

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(e)Status of Lenders.  Any Lender that is entitled to an exemption from or reduction of any withholding tax with respect to any payments hereunder or under any other Loan Document shall, to the extent it may lawfully do so, deliver to Borrower and to the Administrative Agent, at the time or times reasonably requested by Borrower or the Administrative Agent, such properly completed and executed documentation prescribed by applicable Requirements of Law or reasonably requested by Borrower or the Administrative Agent as will permit such payments to be made without withholding or at a reduced rate of withholding.  In addition, any Lender, if requested by Borrower or the Administrative Agent, shall deliver such other documentation prescribed by applicable Requirements of Law or reasonably requested by Borrower or the Administrative Agent as will enable Borrower or the Administrative Agent to determine whether or not such Lender is subject to backup withholding or information reporting requirements.  Notwithstanding anything to the contrary in the above two sentences, in the case of any taxes other than U.S. federal withholding taxes, the completion, execution and submission of documentation shall not be required to the extent that, in the Lender’s judgment, such completion, execution or submission would subject such Lender to any unreimbursed cost or expense or would be disadvantageous to such Lender in any material respect.

Without limiting the generality of the foregoing, any Foreign Lender shall, to the extent it may lawfully do so, deliver to Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) on or prior to the date on which such Foreign Lender becomes a Lender under this Agreement (and from time to time thereafter upon the request of Borrower or the Administrative Agent, but only if such Foreign Lender is legally entitled to do so), whichever of the following is applicable:

(i)duly completed copies of Internal Revenue Service Form W-8BEN (or any successor forms) claiming eligibility for benefits of an income tax treaty to which the United States of America is a party,

(ii)duly completed copies of Internal Revenue Service Form W-8ECI (or any successor forms),

(iii)in the case of a Foreign Lender claiming the benefits of the exemption for portfolio interest under Section 881(c) of the Code, (x) a certificate, in substantially the form of Exhibit Q, or any other form approved by the Administrative Agent, to the effect that such Foreign Lender is not (A) a “bank” within the meaning of Section 881(c)(3)(A) of the Code, (B) a “10 percent shareholder” of Borrower within the meaning of Section 881(c)(3)(B) of the Code, or (C) a “controlled foreign corporation” described in Section 881(c)(3)(C) of the Code, and that no interest payments in connection with the Loan Documents are effectively connected with such Foreign Lender’s conduct of a U.S. trade or business and (y) duly completed copies of Internal Revenue Service Form W-8BEN (or any successor forms),

(iv)to the extent a Foreign Lender is not the beneficial owner (for example, where the Foreign Lender is a partnership or participating Lender granting a participation), an Internal Revenue Service Form W-8IMY, accompanied by a Form W-8ECI, W-8BEN, a certificate in substantially the form of Exhibit Q, Form W-9,and/or other certification documents from each beneficial owner, as applicable; provided that, if the Foreign

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Lender is a partnership (and not a participating Lender) and one or more beneficial owners of such Foreign Lender are claiming the portfolio interest exemption, such Foreign Lender may provide a certificate, in substantially the form of Exhibit Q, on behalf of such beneficial owner(s), or

(v)any other form prescribed by applicable Requirements of Law as a basis for claiming exemption from or a reduction in United States federal withholding tax duly completed together with such supplementary documentation as may be prescribed by applicable Requirements of Law to permit Borrower and the Administrative Agent to determine the withholding or deduction required to be made.

Each Foreign Lender shall, from time to time after the initial delivery by such Foreign Lender of the forms described above, whenever a lapse in time or change in such Foreign Lender’s circumstances renders such forms, certificates or other evidence so delivered expired, obsolete or inaccurate, promptly (1) deliver to Borrower and the Administrative Agent (in such number of copies as shall be requested by the recipient) renewals, amendments or additional or successor forms, properly completed and duly executed by such Foreign Lender, together with any other certificate or statement of exemption required in order to confirm or establish such Foreign Lender’s status or that such Foreign Lender is entitled to an exemption from or reduction in U.S. federal withholding tax or (2) notify Administrative Agent and Borrower in writing of its inability to deliver any such forms, certificates or other evidence.

Any Lender that is not a Foreign Lender shall deliver to Borrower and the Administrative Agent on or prior to the date on which such Lender becomes a Lender under this Agreement (and from time to time thereafter as prescribed by applicable law or upon the request of Borrower or the Administrative Agent), duly executed and properly completed copies of Internal Revenue Service Form W-9, or any successor form(s), certifying that it is not subject to U.S. federal backup withholding.

Each Foreign Lender that is entitled to an exemption from or reduction of any withholding tax imposed under FATCA shall comply with any certification, documentation, information or other reporting necessary to establish an exemption from withholding under FATCA and shall provide any other documentation reasonably requested by Borrower or the Administrative Agent sufficient for the Administrative Agent and Borrower to comply with their obligations under FATCA and to determine that such Foreign Lender has complied with such applicable reporting requirements.

(f)Treatment of Certain Refunds.  If the Administrative Agent or a Lender determines, in its sole discretion, that it has received a refund of any Indemnified Taxes or Other Taxes as to which it has been indemnified by a Loan Party or with respect to which a Loan Party has paid additional amounts pursuant to this Section 2.15, it shall promptly pay to the applicable Loan Party an amount equal to such refund (but only to the extent of indemnity payments made, or additional amounts paid, by such Loan Party under this Section 2.15 with respect to the Indemnified Taxes or Other Taxes giving rise to such refund), net of all out-of-pocket expenses of the Administrative Agent or such Lender, as the case may be, and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund); provided that such Loan Party, upon the request of the Administrative Agent or such Lender, agrees to repay

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the amount paid over to such Loan Party (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) to the Administrative Agent or such Lender or in the event the Administrative Agent or such Lender is required to repay such refund to such Governmental Authority.  This paragraph shall not be construed to require the Administrative Agent or any Lender to make available its tax returns (or any other information relating to its taxes that it deems confidential) to Borrower or any other person.  Notwithstanding anything to the contrary, in no event will the Administrative Agent or any Lender be required to pay any amount to a Loan Party the payment of which would place the Administrative Agent or such Lender in a less favorable net after-tax position than the Administrative Agent or such Lender would have been in if the Indemnified Taxes or Other Taxes giving rise to such refund had never been imposed in the first instance.

(g)Payments.  For purposes of this Section 2.15, (i) any payments by the Administrative Agent to a Lender of any amounts received by the Administrative Agent from a Loan Party on behalf of such Lender shall be treated as a payment from such Loan Party to such Lender and (ii) if a Lender is treated as a partnership by a jurisdiction imposing an Indemnified Tax, any withholding or payment of such Indemnified Tax by the Lender in respect of any of such Lender’s partners shall be considered a withholding or payment of such Indemnified Tax by the applicable Loan Party.

(h)Issuing Bank.  For all purposes of this Section 2.15, the term Lender shall include any Issuing Bank and the Swingline Lender.

SECTION 2.16Mitigation Obligations; Replacement of Lenders.

(a)Designation of a Different Lending Office.  If any Lender or the Issuing Bank requests compensation under Section 2.12, or requires Borrower to pay any additional amount to any Lender or the Issuing Bank or any Governmental Authority for the account of any Lender or the Issuing Bank pursuant to Section 2.15, then such Lender or the Issuing Bank shall use reasonable efforts to designate a different lending office for funding or booking its Loans and/or Letters of Credit hereunder or to assign its rights and obligations hereunder to another of its offices, branches or affiliates, if, in the reasonable judgment of such Lender or the Issuing Bank, such designation or assignment (i) would eliminate or reduce amounts payable pursuant to Section 2.12 or 2.15, as the case may be, in the future and (ii) would not subject such Lender or the Issuing Bank to any unreimbursed cost or expense and would not otherwise be disadvantageous in any material respect to such Lender or the Issuing Bank.  Borrower hereby agrees to pay all reasonable out-of-pocket costs and expenses incurred by any Lender or the Issuing Bank in connection with any such designation or assignment.  A certificate setting forth such costs and expenses in reasonable detail submitted by such Lender to Borrower shall be conclusive absent manifest error.

(b)Replacement of Lenders.  If any Lender or the Issuing Bank requests compensation under Section 2.12, or if Borrower is required to pay any additional amount to any Lender or the Issuing Bank or any Governmental Authority for the account of any Lender or the Issuing Bank pursuant to Section 2.15, or if any Lender or the Issuing Bank is a Defaulting Lender, or if Borrower exercises its replacement rights under Section 10.02(d), then Borrower may, at its sole expense and effort, upon notice to such Lender or the Issuing Bank and the Administrative

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Agent, require such Lender or the Issuing Bank to assign and delegate, without recourse (in accordance with and subject to the restrictions contained in, and consents required by, Section 10.04), all of its interests, rights and obligations under this Agreement and the other Loan Documents to an Eligible Assignee that shall assume such obligations (which assignee may be another Lender, if a Lender accepts such assignment); provided that:

(i)the processing and recordation fee specified in Section 10.04(b) shall have been paid;

(ii)such Lender or the Issuing Bank shall have received payment of an amount equal to the outstanding principal of its Loans and participations in LC Disbursements and Swingline Loans, accrued interest thereon, accrued fees and all other amounts payable to it hereunder and under the other Loan Documents (including any amounts under Section 2.13), from the assignee (to the extent of such outstanding principal and accrued interest and fees) or Borrower (in the case of all other amounts;

(iii)in the case of any such assignment resulting from a claim for compensation under Section 2.12 or payments required to be made pursuant to Section 2.15, such assignment will result in a reduction in such compensation or payments thereafter; and

(iv)such assignment does not conflict with applicable Requirements of Law.

A Lender or the Issuing Bank shall not be required to make any such assignment or delegation if, prior thereto, as a result of a waiver by such Lender or the Issuing Bank or otherwise, the circumstances entitling Borrower to require such assignment and delegation cease to apply.

Each Lender or the Issuing Bank agrees that, if Borrower elects to replace such Lender or the Issuing Bank in accordance with this Section 2.16(b), it shall promptly execute and deliver to the Administrative Agent an Assignment and Assumption to evidence the assignment and shall deliver to the Administrative Agent any Note (if Notes have been issued in respect of such Lender’s or the Issuing Bank’s Loans) subject to such Assignment and Assumption; provided that the failure of any such Lender or the Issuing Bank to execute an Assignment and Assumption shall not render such assignment invalid and such assignment shall be recorded in the Register.

SECTION 2.17Swingline Loans.

(a)Swingline Commitment.  Subject to the terms and conditions set forth herein, the Swingline Lender agrees, in reliance upon the agreements of the other Lenders set forth in this Section 2.17 and in its discretion, to make Swingline Loans to Borrower from time to time during the Revolving Availability Period, in an aggregate principal amount at any time outstanding that will not result in (i) the aggregate principal amount of outstanding Swingline Loans exceeding $5,000,000 or (ii) the sum of the total Revolving Exposures exceeding the total Revolving Commitments; provided that Borrower shall not use the proceeds of any Swingline Loan to refinance an outstanding Swingline Loan.  Within the foregoing limits and subject to the terms and conditions set forth herein, Borrower may borrow, repay and reborrow Swingline Loans.

(b)Swingline Loans.  To request a Swingline Loan, Borrower shall deliver, by hand delivery, e-mail through a “pdf” copy (if arrangements for doing so have been approved by the

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Swingline Lender) or facsimile, a duly completed and executed Borrowing Request to the Administrative Agent and the Swingline Lender, not later than 12:00 noon, New York City time, on the day of a proposed Swingline Loan.  Each such notice shall be irrevocable and shall specify the requested date (which shall be a Business Day) and the amount of the requested Swingline Loan.  Each Swingline Loan shall be an ABR Loan.  The Swingline Lender shall make each Swingline Loan available to Borrower to an account as directed by Borrower in the applicable Borrowing Request maintained with the Administrative Agent (or, in the case of a Swingline Loan made to finance the reimbursement of an LC Disbursement as provided in Section 2.18(e), by remittance to the Issuing Bank) by 3:00 p.m., New York City time, on the requested date of such Swingline Loan.  Borrower shall not request a Swingline Loan if at the time of or immediately after giving effect to the extension of credit contemplated by such request a Default has occurred and is continuing or would result therefrom.  Swingline Loans shall be made in minimum amounts of $100,000 and integral multiples of $100,000 above such amount.

(c)Prepayment.  Borrower shall have the right at any time and from time to time to repay any Swingline Loan, in whole or in part, upon giving written notice to the Swingline Lender and the Administrative Agent before 2:00 p.m., New York City time, on the proposed date of prepayment.

(d)Participations.  The Swingline Lender may at any time in its discretion by written notice given to the Administrative Agent (provided such notice requirement shall not apply if the Swingline Lender and the Administrative Agent are the same entity) not later than 11:00 a.m., New York City time, on the next succeeding Business Day following such notice require the Revolving Lenders to acquire participations on such Business Day in all or a portion of the Swingline Loans then outstanding.  Such notice shall specify the aggregate amount of Swingline Loans in which Revolving Lenders will participate.  Promptly upon receipt of such notice, the Administrative Agent will give notice thereof to each Revolving Lender, specifying in such notice such Lender’s Pro Rata Percentage of such Swingline Loan or Loans.  Each Revolving Lender hereby absolutely and unconditionally agrees, upon receipt of notice as provided above, to pay to the Administrative Agent, for the account of the Swingline Lender, such Lender’s Pro Rata Percentage of such Swingline Loan or Loans.  Each Revolving Lender acknowledges and agrees that its obligation to acquire participations in Swingline Loans pursuant to this paragraph is absolute and unconditional and shall not be affected by any circumstance whatsoever, including the occurrence and continuance of a Default or reduction or termination of the Commitments, and that each such payment shall be made without any offset, abatement, withholding or reduction whatsoever (so long as such payment shall not cause such Lender’s Revolving Exposure to exceed such Lender’s Revolving Commitment).  Each Revolving Lender shall comply with its obligation under this paragraph by wire transfer of immediately available funds, in the same manner as provided in Section 2.02(c) with respect to Loans made by such Lender (and Section 2.02 shall apply, mutatis mutandis, to the payment obligations of the Revolving Lenders), and the Administrative Agent shall promptly pay to the Swingline Lender the amounts so received by it from the Revolving Lenders.  The Administrative Agent shall notify Borrower of any participations in any Swingline Loan acquired by the Revolving Lenders pursuant to this paragraph, and thereafter payments in respect of such Swingline Loan shall be made to the Administrative Agent and not to the Swingline Lender.  Any amounts received by the Swingline Lender from Borrower (or other party on behalf of Borrower) in respect of a Swingline Loan after receipt by the Swingline Lender of the proceeds of a sale of participations therein shall be

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promptly remitted to the Administrative Agent.  Any such amounts received by the Administrative Agent shall be promptly remitted by the Administrative Agent to the Revolving Lenders that shall have made their payments pursuant to this paragraph, as their interests may appear.  The purchase of participations in a Swingline Loan pursuant to this paragraph shall not relieve Borrower of any default in the payment thereof.

SECTION 2.18Letters of Credit.

(a)General.  Subject to the terms and conditions set forth herein, Borrower may request the Issuing Bank, and the Issuing Bank agrees, to issue Letters of Credit for its own account or the account of a Restricted Subsidiary in a form reasonably acceptable to the Administrative Agent and the Issuing Bank, at any time and from time to time during the Revolving Availability Period.  The Issuing Bank shall have no obligation to issue, and Borrower shall not request the issuance of, any Letter of Credit at any time if after giving effect to such issuance, the LC Exposure would exceed the LC Commitment or the total Revolving Exposure would exceed the total Revolving Commitments; provided, however, that only Letters of Credit replacing or backing then existing letters of credit of Borrower and its Restricted Subsidiaries shall be permitted to be issued on the Closing Date.  In the event of any inconsistency between the terms and conditions of this Agreement and the terms and conditions of any form of letter of credit application or other agreement submitted by Borrower to, or entered into by Borrower with, the Issuing Bank relating to any Letter of Credit, the terms and conditions of this Agreement shall control.

(b)Request for Issuance, Amendment, Renewal, Extension; Certain Conditions and Notices.  To request the issuance of a Letter of Credit or the amendment, renewal or extension of an outstanding Letter of Credit, Borrower shall deliver, by hand or facsimile (or transmit by electronic communication, if arrangements for doing so have been approved by the Issuing Bank), an executed LC Request to the Issuing Bank and the Administrative Agent not later than 12:00 noon on the third Business Day preceding the requested date of issuance, amendment, renewal or extension (or such later date and time as is acceptable to the Issuing Bank).

A request for an initial issuance of a Letter of Credit shall specify in form and detail reasonably satisfactory to the Issuing Bank:

(i)the proposed issuance date of the requested Letter of Credit (which shall be a Business Day);

(ii)the amount thereof;

(iii)the expiry date thereof (which shall not be later than the close of business on the Letter of Credit Expiration Date);

(iv)the name and address of the beneficiary thereof;

(v)whether the Letter of Credit is to be issued for its own account or for the account of one of its Restricted Subsidiaries (provided that Borrower shall be a co-applicant, and therefore jointly and severally liable, with respect to each Letter of Credit issued for the account of a Restricted Subsidiary);

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(vi)the documents to be presented by such beneficiary in connection with any drawing thereunder;

(vii)the full text of any certificate to be presented by such beneficiary in connection with any drawing thereunder; and

(viii)such other matters as the Issuing Bank may reasonably require.

A request for an amendment, renewal or extension of any outstanding Letter of Credit shall specify in form and detail reasonably satisfactory to the Issuing Bank:

(i)the Letter of Credit to be amended, renewed or extended;

(ii)the proposed date of amendment, renewal or extension thereof (which shall be a Business Day);

(iii)the nature of the proposed amendment, renewal or extension; and

(iv)such other matters as the Issuing Bank may reasonably require.

If requested by the Issuing Bank, Borrower also shall submit a letter of credit application on the Issuing Bank’s standard form in connection with any request for a Letter of Credit.  A Letter of Credit shall be issued, amended, renewed or extended only if (and, upon issuance, amendment, renewal or extension of each Letter of Credit, Borrower shall be deemed to represent and warrant that), after giving effect to such issuance, amendment, renewal or extension, (i) the LC Exposure shall not exceed the LC Commitment, (ii) the total Revolving Exposures shall not exceed the total Revolving Commitments and (iii) the conditions set forth in Article IV in respect of such issuance, amendment, renewal or extension shall have been satisfied.  Unless the Issuing Bank and the Administrative Agent shall agree otherwise, no Letter of Credit shall be in an initial amount less than $10,000, in the case of a Commercial Letter of Credit, or $250,000, in the case of a Standby Letter of Credit, or is to be denominated in a currency other than Dollars

Upon the issuance of any Letter of Credit or amendment, renewal, extension or modification to a Letter of Credit, the Issuing Bank shall promptly notify the Administrative Agent, who shall promptly notify each Revolving Lender, thereof, which notice shall be accompanied by a copy of such Letter of Credit or amendment, renewal, extension or modification to a Letter of Credit and the amount of such Lender’s respective participation in such Letter of Credit pursuant to Section 2.18(d).  On the first Business Day of each calendar month, the Issuing Bank shall provide to the Administrative Agent a report listing all outstanding Letters of Credit and the amounts and beneficiaries thereof and the Administrative Agent shall promptly provide such report to each Revolving Lender.

(c)Expiration Date.

(i)Each Letter of Credit shall expire at or prior to the close of business on the earlier of (x) the date which is one year after the date of the issuance of such Letter of Credit (or, in the case of any renewal or extension thereof, one year after such renewal or extension) and (y) the Letter of Credit Expiration Date.

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(ii)If Borrower so requests in any LC Request, the Issuing Bank may, in its sole and absolute discretion, agree to issue a Letter of Credit that has automatic renewal provisions (each, an “Auto-Renewal Letter of Credit”); provided that any such Auto-Renewal Letter of Credit must permit the Issuing Bank to prevent any such renewal at least once in each twelve-month period (commencing with the date of issuance of such Letter of Credit) by giving prior notice to the beneficiary thereof not later than a day in each such twelve-month period to be agreed upon at the time such Letter of Credit is issued.  Unless otherwise directed by the Issuing Bank, Borrower shall not be required to make a specific request to the Issuing Bank for any such renewal.  Once an Auto-Renewal Letter of Credit has been issued, the Revolving Lenders shall be deemed to have authorized (but may not require) the Issuing Bank to permit the renewal of such Letter of Credit at any time to an expiry date not later than the earlier of (A) one year from the date of such renewal and (B) the Letter of Credit Expiration Date; provided that the Issuing Bank shall not permit any such renewal if (x) the Issuing Bank has determined that it would have no obligation at such time to issue such Letter of Credit in its renewed form under the terms hereof (by reason of the provisions of Section 2.18(l) or otherwise), or (y) it has received notice on or before the day that is two Business Days before the date which has been agreed upon pursuant to the proviso of the first sentence of this paragraph, (1) from the Administrative Agent that any Revolving Lender directly affected thereby has elected not to permit such renewal or (2) from the Administrative Agent or Borrower that one or more of the applicable conditions specified in Section 4.02 are not then satisfied.

(d)Participations.  By the issuance of a Letter of Credit (including on the Closing Date with respect to the Existing Letters of Credit or an amendment to a Letter of Credit increasing the amount thereof) and without any further action on the part of the Issuing Bank or the Lenders, the Issuing Bank hereby irrevocably grants to each Revolving Lender, and each Revolving Lender hereby acquires from the Issuing Bank, a participation in such Letter of Credit equal to such Revolving Lender’s Pro Rata Percentage of the aggregate amount available to be drawn under such Letter of Credit.  In consideration and in furtherance of the foregoing, each Revolving Lender hereby absolutely and unconditionally agrees to pay to the Administrative Agent, for the account of the Issuing Bank, such Revolving Lender’s Pro Rata Percentage of each LC Disbursement made by the Issuing Bank and not reimbursed by Borrower on the date due as provided in Section 2.18(e), or of any reimbursement payment required to be refunded to Borrower for any reason.  Each Revolving Lender acknowledges and agrees that its obligation to acquire participations pursuant to this paragraph in respect of Letters of Credit is absolute and unconditional and shall not be affected by any circumstance whatsoever, including any amendment, renewal or extension of any Letter of Credit or the occurrence and continuance of a Default or reduction or termination of the Commitments, or expiration, termination or cash collateralization of any Letter of Credit and that each such payment shall be made without any offset, abatement, withholding or reduction whatsoever.

(e)Reimbursement.

(i)If the Issuing Bank shall make any LC Disbursement in respect of a Letter of Credit, Borrower shall reimburse such LC Disbursement by paying to the Issuing Bank an amount equal to such LC Disbursement not later than 3:00 p.m., New York City time,

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on the date that such LC Disbursement is made if Borrower shall have received notice of such LC Disbursement prior to 11:00 a.m., New York City time, on such date, or, if such notice has not been received by Borrower prior to such time on such date, then not later than 3:00 p.m., New York City time, on the Business Day immediately following the day that Borrower receives such notice; provided that Borrower may, subject to the conditions to borrowing set forth herein, request in accordance with Section 2.03 that such payment be financed with ABR Revolving Loans or Swingline Loans in an equivalent amount and, to the extent so financed, Borrower’s obligation to make such payment shall be discharged and replaced by the resulting ABR Revolving Loans or Swingline Loans.

(ii)If Borrower fails to make such payment when due, the Issuing Bank shall notify the Administrative Agent and the Administrative Agent shall notify each Revolving Lender of the applicable LC Disbursement, the payment then due from Borrower in respect thereof and such Revolving Lender’s Pro Rata Percentage thereof.  Each Revolving Lender shall pay by wire transfer of immediately available funds to the Administrative Agent not later than 2:00 p.m., New York City time, on such date (or, if such Revolving Lender shall have received such notice later than 12:00 noon, New York City time, on any day, not later than 11:00 a.m., New York City time, on the immediately following Business Day), an amount equal to such Revolving Lender’s Pro Rata Percentage of the unreimbursed LC Disbursement in the same manner as provided in Section 2.02(c) with respect to Revolving Loans made by such Revolving Lender, and the Administrative Agent will promptly pay to the Issuing Bank the amounts so received by it from the Revolving Lenders.  The Administrative Agent will promptly pay to the Issuing Bank any amounts received by it from Borrower pursuant to the above paragraph prior to the time that any Revolving Lender makes any payment pursuant to the preceding sentence and any such amounts received by the Administrative Agent from Borrower thereafter will be promptly remitted by the Administrative Agent to the Revolving Lenders that shall have made such payments and to the Issuing Bank, as appropriate.

(iii)If any Revolving Lender shall not have made its Pro Rata Percentage of such LC Disbursement available to the Administrative Agent as provided above, each of such Revolving Lender and Borrower severally agrees to pay interest on such amount, for each day from and including the date such amount is required to be paid in accordance with the foregoing to but excluding the date such amount is paid, to the Administrative Agent for the account of the Issuing Bank at (i) in the case of Borrower, the rate per annum set forth in Section 2.18(h) and (ii) in the case of such Lender, at a rate determined by the Administrative Agent in accordance with banking industry rules or practices on interbank compensation.

(f)Obligations Absolute.  The Reimbursement Obligation of Borrower as provided in Section 2.18(e) shall be absolute, unconditional and irrevocable, and shall be paid and performed strictly in accordance with the terms of this Agreement under any and all circumstances whatsoever and irrespective of (i) any lack of validity or enforceability of any Letter of Credit or this Agreement, or any term or provision therein; (ii) any draft or other document presented under a Letter of Credit being proved to be forged, fraudulent, invalid or insufficient in any respect or any statement therein being untrue or inaccurate in any respect; (iii) payment by the Issuing Bank under a Letter of Credit against presentation of a draft or other document that fails to

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comply with the terms of such Letter of Credit; (iv) any other event or circumstance whatsoever, whether or not similar to any of the foregoing, that might, but for the provisions of this Section 2.18(f), constitute a legal or equitable discharge of, or provide a right of setoff against, the obligations of Borrower hereunder; (v) the fact that a Default shall have occurred and be continuing; or (vi) any material adverse change in the business, property, results of operations, prospects or condition, financial or otherwise, of Borrower and its Restricted Subsidiaries.  None of the Agents, the Lenders, the Issuing Bank or any of their Affiliates shall have any liability or responsibility by reason of or in connection with the issuance or transfer of any Letter of Credit or any payment or failure to make any payment thereunder (irrespective of any of the circumstances referred to in the preceding sentence), or any error, omission, interruption, loss or delay in transmission or delivery of any draft, notice or other communication under or relating to any Letter of Credit (including any document required to make a drawing thereunder), any error in interpretation of technical terms or any consequence arising from causes beyond the control of the Issuing Bank; provided that the foregoing shall not be construed to excuse the Issuing Bank from liability to Borrower to the extent of any direct damages (as opposed to consequential damages, claims in respect of which are hereby waived by Borrower to the extent permitted by applicable Requirements of Law) suffered by Borrower that are caused by the Issuing Bank’s failure to exercise care when determining whether drafts and other documents presented under a Letter of Credit comply with the terms thereof.  The parties hereto expressly agree that, in the absence of bad faith, gross negligence or willful misconduct on the part of the Issuing Bank (as finally determined by a court of competent jurisdiction), the Issuing Bank shall be deemed to have exercised care in each such determination.  In furtherance of the foregoing and without limiting the generality thereof, the parties agree that, with respect to documents presented which appear on their face to be in substantial compliance with the terms of a Letter of Credit, the Issuing Bank may, in its reasonable discretion, either accept and make payment upon such documents without responsibility for further investigation, regardless of any notice or information to the contrary, or refuse to accept and make payment upon such documents if such documents are not in strict compliance with the terms of such Letter of Credit.

(g)Disbursement Procedures.  The Issuing Bank shall, promptly following its receipt thereof, examine all documents purporting to represent a demand for payment under a Letter of Credit.  The Issuing Bank shall promptly give written notice to the Administrative Agent and Borrower of such demand for payment and whether the Issuing Bank has made or will make an LC Disbursement thereunder; provided that any failure to give or delay in giving such notice shall not relieve Borrower of its Reimbursement Obligation to the Issuing Bank and the Revolving Lenders with respect to any such LC Disbursement (other than with respect to the timing of such Reimbursement Obligation set forth in Section 2.18(e)).

(h)Interim Interest.  If the Issuing Bank shall make any LC Disbursement, then, unless Borrower shall reimburse such LC Disbursement in full on the date such LC Disbursement is made, the unpaid amount thereof shall bear interest payable on demand, for each day from and including the date such LC Disbursement is made to and including the date that Borrower is required to reimburse such LC Disbursement under Section 2.18(e)(i), at the interest rate then in effect for ABR Loans, and thereafter, at the rate per annum determined pursuant to Section 2.06(c) until (but excluding) the date that Borrower reimburses such LC Disbursement.  Interest accrued pursuant to this paragraph shall be for the account of the Issuing Bank, except that interest accrued on and after the date of payment by any Revolving Lender pursuant to

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Section 2.18(e) to reimburse the Issuing Bank shall be for the account of such Lender to the extent of such payment.

(i)Cash Collateralization.  If any Event of Default shall occur and be continuing, on the Business Day that Borrower receives notice from the Administrative Agent or the Required Lenders (or, if the maturity of the Loans has been accelerated, Revolving Lenders with LC Exposure representing greater than 50% of the total LC Exposure) demanding the deposit of cash collateral pursuant to this paragraph, Borrower shall deposit on terms and in accounts reasonably satisfactory to the Collateral Agent, in the name of the Collateral Agent and for the benefit of the Revolving Lenders, an amount in cash equal to the LC Exposure as of such date plus any accrued and unpaid interest thereon; provided that the obligation to deposit such cash collateral shall become effective immediately, and such deposit shall become immediately due and payable, without demand or other notice of any kind, upon the occurrence of any Event of Default with respect to Borrower described in Section 8.01(g) or (h).  Funds so deposited shall be applied by the Collateral Agent to reimburse the Issuing Bank for LC Disbursements for which it has not been reimbursed and, to the extent not so applied, shall be held for the satisfaction of outstanding Reimbursement Obligations or, if the maturity of the Loans has been accelerated (but subject to the consent of Revolving Lenders with LC Exposure representing greater than 50% of the total LC Exposure), be applied to satisfy other Obligations of Borrower under this Agreement.  If Borrower is required to provide an amount of cash collateral under this Section 2.18(i) as a result of the occurrence of an Event of Default, such amount plus any accrued interest or realized profits with respect to such amounts (to the extent not applied as aforesaid) shall be returned to Borrower within three Business Days after all Events of Default have been cured or waived.

(j)Additional Issuing Banks.  Borrower may, at any time and from time to time, designate one or more additional Revolving Lenders to act as an issuing bank under the terms of this Agreement, with the consent of the Administrative Agent (which consent shall not be unreasonably withheld) and such designated Revolving Lender(s).  Any Revolving Lender designated as an issuing bank pursuant to this paragraph (j) shall have all the rights and obligations of the Issuing Bank under the Loan Documents with respect to Letters of Credit issued or to be issued by it, and all references in the Loan Documents to the term “Issuing Bank” shall, with respect to such Letters of Credit, be deemed to refer to such Revolving Lender in its capacity as the Issuing Bank, as the context shall require.  The Administrative Agent shall notify the Lenders of any such additional Issuing Bank.  If at any time there is more than one Issuing Bank hereunder, Borrower may, in its sole discretion, select which Issuing Bank is to issue any particular Letter of Credit.

(k)Resignation or Removal of the Issuing Bank.  The Issuing Bank may resign as Issuing Bank hereunder at any time upon at least 30 days’ prior notice to the Lenders, the Administrative Agent and Borrower.  The Issuing Bank may be replaced at any time by written agreement among Borrower, and each Agent.  The Administrative Agent shall notify the Lenders of any such replacement of the Issuing Bank.  At the time any such resignation of the Issuing Bank shall become effective, Borrower shall pay all unpaid fees accrued for the account of the retiring Issuing Bank pursuant to Section 2.05(c).  From and after the effective date of any such resignation or replacement, (i) the successor Issuing Bank shall have all the rights and obligations of the Issuing Bank under this Agreement with respect to Letters of Credit to be issued by it thereafter and (ii) references herein to the term “Issuing Bank” shall be deemed to refer to such successor

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or to any previous Issuing Bank, or to such successor and all previous Issuing Banks, as the context shall require.  After the resignation or replacement of an Issuing Bank, the replaced Issuing Bank shall remain a party hereto and shall continue to have all the rights and obligations of an Issuing Bank under this Agreement with respect to Letters of Credit issued by it prior to such resignation or replacement, but shall not be required to issue additional Letters of Credit.

(l)Other.  The Issuing Bank shall be under no obligation to issue any Letter of Credit if

(i)any order, judgment or decree of any Governmental Authority or arbitrator shall by its terms purport to enjoin or restrain the Issuing Bank from issuing such Letter of Credit, or any Requirement of Law applicable to the Issuing Bank or any request or directive (whether or not having the force of law) from any Governmental Authority with jurisdiction over the Issuing Bank shall prohibit, or request that the Issuing Bank refrain from, the issuance of letters of credit generally or such Letter of Credit in particular or shall impose upon the Issuing Bank with respect to such Letter of Credit any restriction, reserve or capital requirement (for which the Issuing Bank is not otherwise compensated hereunder) not in effect on the Closing Date, or shall impose upon the Issuing Bank any unreimbursed loss, cost or expense which was not applicable on the Closing Date and which the Issuing Bank in good faith deems material to it; or

(ii)the issuance of such Letter of Credit would violate one or more policies of the Issuing Bank.

The Issuing Bank shall be under no obligation to amend any Letter of Credit if (A) the Issuing Bank would have no obligation at such time to issue such Letter of Credit in its amended form under the terms hereof, or (B) the beneficiary of such Letter of Credit does not accept the proposed amendment to such Letter of Credit.

(m)Existing Letters of Credit.  Subject to the terms and conditions hereof, each Existing Letter of Credit that is outstanding on the Closing Date and listed on Schedule 1.01(c) shall, effective as of the Closing Date and without any further action by Borrower, be continued as a Letter of Credit hereunder and from and after the Closing Date shall be deemed a Letter of Credit for all purposes hereof and shall be subject to and governed by the terms and conditions hereof.

SECTION 2.19Defaulting Lenders.

Notwithstanding any provision of this Agreement to the contrary, if any Lender becomes a Defaulting Lender, then the following provisions shall apply for so long as such Lender is a Defaulting Lender:

(a)the Commitment Fee shall cease to accrue on the Commitment of such Lender so long as it is a Defaulting Lender (except to the extent it is payable to the Issuing Bank pursuant to clause (b)(v) below);

(b)if any Swingline Exposure or LC Exposure exists at the time a Lender becomes a Defaulting Lender then:

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(i)all or any part of such Swingline Exposure and LC Exposure shall be reallocated among the non-Defaulting Lenders in accordance with their respective Pro Rata Percentages but only to the extent the sum of all non-Defaulting Lenders’ Revolving Exposures plus such Defaulting Lender’s Swingline Exposure and LC Exposure does not exceed the total of all non-Defaulting Lenders’ Revolving Commitments;

(ii)if the reallocation described in clause (i) above cannot, or can only partially, be effected, Borrower shall within three Business Days following notice by the Administrative Agent (x) first, prepay such Defaulting Lender’s Swingline Exposure and (y) second, cash collateralize such Defaulting Lender’s LC Exposure (after giving effect to any partial reallocation pursuant to clause (i) above) in accordance with the procedures set forth in Section 2.18(i) for so long as such LC Exposure is outstanding;

(iii)if any portion of such Defaulting Lender’s LC Exposure is cash collateralized pursuant to clause (ii) above, Borrower shall not be required to pay the LC Participation Fee with respect to such portion of such Defaulting Lender’s LC Exposure so long as it is cash collateralized;

(iv)if any portion of such Defaulting Lender’s LC Exposure is reallocated to the non-Defaulting Lenders pursuant to clause (i) above, then the LC Participation Fee with respect to such portion shall be allocated among the non-Defaulting Lenders in accordance with their Pro Rata Percentages; or

(v)if any portion of such Defaulting Lender’s LC Exposure is neither cash collateralized nor reallocated pursuant to this Section 2.19(b), then, without prejudice to any rights or remedies of the Issuing Bank or any Lender hereunder, the Commitment Fee that otherwise would have been payable to such Defaulting Lender (with respect to the portion of such Defaulting Lender’s Revolving Commitment that was utilized by such LC Exposure) and the LC Participation Fee payable with respect to such Defaulting Lender’s LC Exposure shall be payable to the Issuing Bank until such LC Exposure is cash collateralized and/or reallocated;

(c)so long as any Lender is a Defaulting Lender, the Swingline Lender shall not be required to fund any Swingline Loan and the Issuing Bank shall not be required to issue, amend or increase any Letter of Credit, unless it is satisfied that the related exposure will be 100% covered by the Revolving Commitments of the non-Defaulting Lenders and/or cash collateralized in accordance with Section 2.19(b), and participations in any such newly issued or increased Letter of Credit or newly made Swingline Loan shall be allocated among non-Defaulting Lenders in accordance with their respective Pro Rata Percentages (and Defaulting Lenders shall not participate therein); and

(d)any amount payable to such Defaulting Lender hereunder (whether on account of principal, interest, fees or otherwise and including any amount that would otherwise be payable to such Defaulting Lender pursuant to Section 2.14(d) but excluding Section 2.16(b)) may, in lieu of being distributed to such Defaulting Lender, be retained

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by the Administrative Agent in a segregated non-interest bearing account and, subject to any applicable Requirements of Law, be applied at such time or times as may be determined by the Administrative Agent (i) first, to the payment of any amounts owing by such Defaulting Lender to the Administrative Agent hereunder, (ii) second, pro rata, to the payment of any amounts owing by such Defaulting Lender to the Issuing Bank or Swingline Lender hereunder, (iii) third, to the funding of any Loan or the funding or cash collateralization of any participation in any Swingline Loan or Letter of Credit in respect of which such Defaulting Lender has failed to fund its portion thereof as required by this Agreement, as determined by the Administrative Agent, (iv) fourth, if so determined by the Administrative Agent and Borrower, held in such account as cash collateral for future funding obligations of the Defaulting Lender under this Agreement, (v) fifth, pro rata, to the payment of any amounts owing to Borrower or the Lenders as a result of any judgment of a court of competent jurisdiction obtained by Borrower or any Lender against such Defaulting Lender as a result of such Defaulting Lender’s breach of its obligations under this Agreement and (vi) sixth, to such Defaulting Lender or as otherwise directed by a court of competent jurisdiction; provided that if such payment is (x) a prepayment of the principal amount of any Loans or Reimbursement Obligations in respect of LC Disbursements which a Defaulting Lender has funded its participation obligations and (y) made at a time when the conditions set forth in Section 4.02 are satisfied, such payment shall be applied solely to prepay the Loans of, and Reimbursement Obligations owed to, all non-Defaulting Lenders pro rata prior to being applied to the prepayment of any Loans, or Reimbursement Obligations owed to, any Defaulting Lender.

In the event that the Administrative Agent, Borrower, the Issuing Bank or the Swingline Lender, as the case may be, each agrees that a Defaulting Lender has adequately remedied all matters that caused such Lender to be a Defaulting Lender, then the Swingline Exposure and LC Exposure of the Lenders shall be readjusted to reflect the inclusion of such Lender’s Commitment and on such date such Lender shall purchase at par such of the Loans of the other Lenders as the Administrative Agent shall determine may be necessary in order for such Lender to hold such Loans in accordance with its Pro Rata Percentage.  The rights and remedies against a Defaulting Lender under this Section 2.19 are in addition to other rights and remedies that Borrower, the Administrative Agent, the Issuing Bank, the Swingline Lender and the non-Defaulting Lenders may have against such Defaulting Lender.  The arrangements permitted or required by this Section 2.19 shall be permitted under this Agreement, notwithstanding any limitation on Liens or the pro rata sharing provisions or otherwise.

SECTION 2.20Increase in Commitments.

(a)Borrower Request.  Borrower may by written notice to the Administrative Agent elect to request (x) prior to the Revolving Maturity Date, an increase to the existing Revolving Commitments (each an “Incremental Revolving Commitment”) and/or (y) the establishment of one or more new term loan commitments (each, an “Incremental Term Loan Commitment” and the term loans made pursuant thereto, the “Incremental Term Loans”) by an amount not in excess of $50,000,000 in the aggregate and not less than $10,000,000 individually.  Each such notice shall specify (i) the date (each, an “Increase Effective Date”) on which Borrower proposes that the increased or new Commitments shall be effective, which shall be a date not less than 10 Business Days (or such shorter period as is acceptable to the Administrative Agent) after the

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date on which such notice is delivered to the Administrative Agent and (ii) the identity of each Eligible Assignee to whom Borrower proposes any portion of such increased or new Commitments be allocated and the amounts of such allocations; provided that Borrower shall first seek new or increased Commitments on terms permissible under this Section 2.20 and acceptable to Borrower from existing Lenders (pro rata to their original Term B Loan Commitments) before approaching any other Eligible Assignee; provided further that any existing Lender approached to provide a all or a portion of the increased or new Commitments may elect or decline, in its sole discretion, to provide such increased or new Commitment; provided further that each person who is not an existing Lender to which new Commitments are to be allocated must be a bank, financial institution or other institutional lender (other than Sponsors, Holdings, or any Subsidiary or Affiliate of Holdings or Sponsors) reasonably acceptable to the Administrative Agent; provided further that each person who is not an existing Revolving Lender to which Incremental Revolving Commitments are to be allocated must be a bank, financial institution or other institutional lender (other than Sponsors, Holdings or any Subsidiary or Affiliate of Holdings or Sponsors) reasonably acceptable to the Issuing Bank and the Swingline Lender.

(b)Conditions.  The increased or new Commitments shall become effective, as of such Increase Effective Date; provided that:

(i)each of the conditions set forth in Section 4.02(c) — (d) shall be satisfied;

(ii)no Default shall have occurred and be continuing or would result from the borrowings to be made on the Increase Effective Date;

(iii)on a Pro Forma Basis after giving effect to any Loans to be outstanding after giving effect to the Incremental Term Loans or Incremental Revolving Commitments, Borrower shall be in compliance with each of the covenants set forth in Section 6.09 as of the end of the most recent Test Period; and

(iv)Borrower shall deliver or cause to be delivered any legal opinions or other documents reasonably requested by the Administrative Agent in connection with any such transaction.

(c)Terms of New Loans and Commitments.  The terms and provisions of Loans made pursuant to the new Commitments shall be as follows:

(i)the terms and provisions of Incremental Revolving Commitments shall be identical to the existing Revolving Commitments;

(ii)the weighted average life to maturity of any Incremental Term Loans shall be no shorter than the weighted average life to maturity of the existing Term B Loans;

(iii)the maturity date of Incremental Term Loans (the “Incremental Term Loan Maturity Date”) shall not be earlier than the Final Maturity Date;

(iv)the Applicable Margins for the Incremental Term Loans shall be determined by Borrower and the Lenders of the Incremental Term Loans; provided that in the event that the Applicable Margins for any Incremental Term Loans are greater than 50

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basis points plus the Applicable Margins for the Term B Loans, then the Applicable Margins for the Term B Loans shall be increased to the extent necessary so that the Applicable Margins for the Incremental Term Loans are equal to the Applicable Margins for the Term B Loans, giving effect to such increase, plus 50 basis points; provided, further, that in determining the Applicable Margins applicable to the Term B Loans and the Incremental Term Loans, (w) original issue discount (“OID”) or upfront fees (which shall be deemed to constitute like amounts of OID) payable directly or indirectly by Borrower or any Subsidiary to the Lenders of the Term B Loans or the Incremental Term Loans in the primary syndication thereof shall be included (with OID being equated to interest based on an assumed four-year life to maturity), (x) customary arrangement or, commitment fees or closing fee payable to the arrangers with respect thereto (or their Affiliates), to the extent not shared with the Lenders on a pro rata basis, in connection with the Term B Loans or to one or more arrangers (or their affiliates) of the Incremental Term Loans, to the extent not shared with the lenders of such Incremental Term Loans on a pro rata basis, in connection with the Incremental Term Loans, shall be excluded, (y) any floor for the Adjusted LIBOR Rate or Alternate Base Rate applicable to the Incremental Term Loans that is higher than the respective floor for the Adjusted LIBOR Rate or Alternate Base Rate applicable to the Term B Loans shall be equated to an increase in the interest rate margin in the amount of the excess of (A) the floor for the Adjusted LIBOR Rate or Alternate Base Rate applicable to the Incremental Term Loans over (B) the Adjusted LIBOR Rate or the Alternate Base Rate applicable to the Term B Loans at such time of determination, and (z) any floor for the Adjusted LIBOR Rate or Alternate Base Rate applicable to the Incremental Term Loans that is lower than the respective floor for the Adjusted LIBOR Rate or Alternate Base Rate applicable to the Term B Loans shall be equated to a decrease in the interest rate margin in the amount of the excess of (A) the floor for the Adjusted LIBOR Rate or Alternate Base Rate applicable to the Term B Loans over (B) the Adjusted LIBOR Rate or the Alternate Base Rate applicable to the Incremental Term Loans at such time of determination; provided that for purposes of this Section 2.20(c)(iv), the “floor” with respect to the Alternate Base Rate shall be the rate set forth in clause (c) of the definition of Alternate Base Rate or any similar component of the Alternate Base Rate which ties such rate to the Adjusted LIBOR Rate.

(v)to the extent that the terms and provisions of Incremental Term Loans are not identical to the Term B Loans (except to the extent permitted by clause (iii), (iv) or (v) above) they shall be reasonably satisfactory to the Administrative Agent; and

(vi)any Incremental Term Loans and Loans and Credit Extensions made pursuant to Incremental Revolving Commitments shall rank pari passu in right of payment in respect of the Collateral and with the Obligations in respect of the Term B Loans and the Revolving Commitments.

The increased or new Commitments shall be effected by a joinder agreement (the “Increase Joinder”) executed by Borrower, the Administrative Agent and each Lender making such increased or new Commitment, in form and substance reasonably satisfactory to each of them.  The Increase Joinder may, without the consent of any other Lenders, effect such amendments to this Agreement and the other Loan Documents as may be necessary or appropriate, in the opinion of the Administrative Agent, to effect the provisions of this Section 2.20.  In addition,

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unless otherwise specifically provided herein, all references in Loan Documents to Term Loans or Term B Loans shall be deemed, unless the context otherwise requires, to include references to Incremental Term Loans that are Term B Loans made pursuant to this Agreement.

(d)Adjustment of Revolving Loans.  To the extent the Commitments being increased on the relevant Increase Effective Date are Revolving Commitments, then each Revolving Lender that is acquiring a new or additional Revolving Commitment on the Increase Effective Date shall make a Revolving Loan, the proceeds of which will be used to prepay the Revolving Loans of the other Revolving Lenders immediately prior to such Increase Effective Date, so that, after giving effect thereto, the Revolving Loans outstanding are held by the Revolving Lenders pro rata based on their Revolving Commitments after giving effect to such Increase Effective Date.  If there is a new borrowing of Revolving Loans on such Increase Effective Date, the Revolving Lenders after giving effect to such Increase Effective Date shall make such Revolving Loans in accordance with Section 2.01(b).

(e)Making of New Term Loans.  On any Increase Effective Date on which new Commitments for Term Loans are effective, subject to the satisfaction of the foregoing terms and conditions, each Lender of such new Commitment shall make a Term Loan to Borrower in an amount equal to its new Commitment.

(f)Equal and Ratable Benefit.  The Loans and Commitments established pursuant to this paragraph shall constitute Loans and Commitments under, and shall be entitled to all the benefits afforded by, this Agreement and the other Loan Documents, and shall, without limiting the foregoing, benefit equally and ratably from the Guarantees and security interests created by the Security Documents.  The Loan Parties shall take any actions reasonably required by the Administrative Agent to ensure and/or demonstrate that the Lien and security interests granted by the Security Documents continue to be perfected under the UCC or otherwise after giving effect to the establishment of any such Class of Term Loans or any such new Commitments.

ARTICLE III.

REPRESENTATIONS AND WARRANTIES

Each Loan Party represents and warrants to the Administrative Agent, the Collateral Agent, the Issuing Bank and each of the Lenders (with references to the Companies being references thereto after giving effect to the Transactions unless otherwise expressly stated) that:

SECTION 3.01Organization; Powers.

Each Company (a) is duly organized and validly existing under the laws of the jurisdiction of its organization, (b) has all requisite power and authority to carry on its business as now conducted and to own and lease its property, except where the failure to do so could not reasonably be expected to have a Material Adverse Effect and (c) is qualified and in good standing (to the extent such concept is applicable in the applicable jurisdiction) to do business in every jurisdiction where such qualification is required, except in such jurisdictions where the failure to so qualify or be in good standing, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.

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SECTION 3.02Authorization; Enforceability.

The Transactions to be entered into by each Loan Party are within such Loan Party’s powers and have been duly authorized by all necessary action on the part of such Loan Party.  This Agreement has been duly executed and delivered by each Loan Party and constitutes, and each other Loan Document to which any Loan Party is to be a party, when executed and delivered by such Loan Party, will constitute, a legal, valid and binding obligation of such Loan Party, enforceable in accordance with its terms, subject to applicable bankruptcy, insolvency, reorganization, moratorium or other laws affecting creditors’ rights generally and subject to general principles of equity, regardless of whether considered in a proceeding in equity or at law.

SECTION 3.03No Conflicts.

Except as set forth on Schedule 3.03, the Transactions (a) do not require any consent or approval of, registration or filing with, or any other action by, any Governmental Authority, except (i) such as have been obtained or made and are in full force and effect, (ii) filings necessary to perfect Liens created by the Loan Documents and (iii) consents, approvals, registrations, filings, permits or actions the failure to obtain or perform which could not reasonably be expected to result in a Material Adverse Effect, (b) will not violate the Organizational Documents of any Company, (c) will not violate any Requirement of Law, except for violations that could not reasonably be expected to have a Material Adverse Effect, (d) will not violate or result in a default or require any consent or approval under any indenture, agreement or other instrument binding upon any Company or its property, or give rise to a right thereunder to require any payment to be made by any Company, except for violations, defaults or the creation of such rights that could not reasonably be expected to result in a Material Adverse Effect, and (e) will not result in the creation or imposition of any Lien on any property of any Company, except Liens created by the Loan Documents and Permitted Liens.

SECTION 3.04Financial Statements; Projections.

(a)Historical Financial Statements.  Borrower has heretofore delivered to the Lenders the consolidated balance sheets and related statements of income, stockholders’ equity and cash flows of the Acquired Business as of and for the fiscal years ended 2008, 2009 and 2010, audited by and accompanied by the unqualified opinion of KPMG LLP, independent public accountants.  Such financial statements and all financial statements delivered pursuant to Sections 5.01(a), (b) and (c) have been prepared in accordance with GAAP (except as otherwise provided in Sections 5.01(a), (b) and (c)) and present (fairly in all material respects) the financial condition and results of operations and cash flows of Holdings and its Subsidiaries as of the dates and for the periods to which they relate.

(b)No Liabilities.  Except as set forth in the financial statements referred to in Section 3.04(a) and Section 4.01(e)(iii), there are no liabilities of any Company of any kind, whether accrued, contingent, absolute, determined, determinable or otherwise, which could reasonably be expected to result in a Material Adverse Effect, other than liabilities under the Loan Documents and the Senior Note Documents and other Indebtedness permitted by Section 6.01.  Since the Closing Date, there has been no event, change, circumstance or occurrence that, individually or in the aggregate, has had or could reasonably be expected to result in a Material Adverse Effect.

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(c)Forecasts.  The forecasts of financial performance of Holdings and its Subsidiaries furnished to the Lenders pursuant to Section 4.01(e)(iii) or 5.01(f) have been prepared in good faith by Borrower and based on assumptions believed by Borrower to be reasonable at the time furnished (it being understood by the parties that forecast by their nature are inherently uncertain and are not a guarantee of financial performance and actual results may differ from forecast and such differences may be material).

SECTION 3.05Properties.

(a)Generally.  Each Company has good title to, or valid leasehold interests in, all its property material to its business, free and clear of all Liens except for, in the case of Collateral, Permitted Collateral Liens and, in the case of all other material property, Permitted Liens and other irregularities or deficiencies in title that, individually or in the aggregate, do not interfere in any material respect with the ability of the Companies, taken as a whole, to conduct their business as currently conducted.  The property of the Companies, taken as a whole, (i) is in good operating order, condition and repair (ordinary wear and tear excepted), except to the extent that the failure to be in such condition could not be reasonably expected to result in a Material Adverse Effect and (ii) constitutes all the property which is required for the business and operations of the Companies as presently conducted.

(b)Real Property.  Schedules 7(a) and 7(b) to the Perfection Certificate dated the Closing Date contain a true and complete list of each interest in Real Property (i) owned by any Company as of the date hereof and describes the type of interest therein held by such Company and (ii) leased, subleased or otherwise occupied or utilized by any Company, as lessee, sublessee, franchisee or licensee, as of the date hereof and describes the type of interest therein held by such Company and whether such Lease requires the consent of the landlord thereunder, or other party thereto, to the Transactions.

SECTION 3.06Intellectual Property.

(a)Ownership/No Claims.  Each Company owns, or is licensed to use, all patents, patent applications, trademarks, trade names, service marks, copyrights, technology, trade secrets, proprietary information, domain names, know-how and processes necessary for the conduct of its business as currently conducted (the “Intellectual Property”), except for those the failure to own or license which, individually or in the aggregate, would not reasonably be expected to result in a Material Adverse Effect.  Except as set forth on Schedule 3.06(a), no claim has been asserted and is pending by any person alleging that any Company or the conduct of its business has infringed or is infringing the Intellectual Property rights of any third party or challenging or questioning the validity or effectiveness of any such Intellectual Property that is owned by any Company, nor does any Company know of any threatened or anticipated claims, in each case, either individually or together with any of the items set forth on Schedule 3.06(a), that could reasonably be expected to result in a Material Adverse Effect.   Each Company’s business as presently conducted does not infringe the rights of any person, except such infringements that individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.

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(b)Registrations.  Except pursuant to licenses and other user agreements entered into by each Company in the ordinary course of business or that are listed in Schedule 11(a) or 11(b) to the Perfection Certificate, on and as of the date hereof (i) each Company owns and possesses the right to use, and has not authorized or otherwise permitted any other person to use, each Copyright, Patent or Trademark (as such terms are defined in the Security Agreement) listed in Schedule 11(a) or 11(b) to the Perfection Certificate and (ii) all material registrations listed in Schedule 11(a) or 11(b) to the Perfection Certificate are valid and in full force and effect.

(c)No Violations or Proceedings.  To each Company’s knowledge, on and as of the date hereof, there is no material violation by others of any right of such Company with respect to any copyright, patent or trademark listed in Schedule 11(a) or 11(b) to the Perfection Certificate, except as may be set forth on Schedule 3.06(c).

SECTION 3.07Equity Interests and Subsidiaries.

(a)Equity Interests.  Schedules 1(a) and 9(a) to the Perfection Certificate dated the Closing Date set forth a list of (i) all the Subsidiaries of Holdings and their jurisdictions of organization as of the Closing Date and (ii) the number of each class of its Equity Interests authorized, and the number outstanding, on the Closing Date and the number of shares covered by all outstanding options, warrants, rights of conversion or purchase and similar rights at the Closing Date.  All Equity Interests of each Company are duly and validly issued and are fully paid and non-assessable.  All Equity Interests of Borrower are owned directly by Holdings.  Each Loan Party is the record and beneficial owner of, and has good and marketable title to, the Equity Interests pledged by it under the Security Agreement, free of any and all Liens, rights or claims of other persons, except the security interest created by the Security Agreement and nonconsensual Liens permitted by Section 6.02, and there are no outstanding warrants, options or other rights to purchase, or shareholder, voting trust or similar agreements outstanding with respect to, or property that is convertible into, or that requires the issuance or sale of, any such Equity Interests.

(b)No Consent of Third Parties Required.  No consent of any person including any other general or limited partner, any other member of a limited liability company, any other shareholder, any other trust beneficiary or any issuer is necessary (from the perspective of a secured party) in connection with the creation, perfection or first priority status of the security interest of the Collateral Agent in any Equity Interests pledged to the Collateral Agent for the benefit of the Secured Parties under the Security Agreement or the exercise by the Collateral Agent of the voting or other rights provided for in the Security Agreement or the exercise of remedies in respect thereof.

(c)Organizational Chart.  An accurate organizational chart, showing the ownership structure of Holdings, Borrower and each Subsidiary on the Closing Date, and after giving effect to the Transactions, is set forth on Schedule 3.07(c).

SECTION 3.08Litigation; Compliance with Laws.

(a)There are no actions, suits or proceedings at law or in equity by or before any Governmental Authority now pending or, to the knowledge of any Company, threatened against or affecting any Company or any business, property or rights of any Company (i) that challenges

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the enforceability or legality of any Loan Document or any of the Transactions or (ii) that could reasonably be expected, individually or in the aggregate, to result in a Material Adverse Effect.  Except for matters covered by Section 3.18, no Company or any of its property is in violation of, nor will the continued operation of its property as currently conducted violate, any Requirements of Law or any restrictions of record or agreements affecting any Company’s Real Property or is in default with respect to any Requirement of Law, where such violation or default, individually or in the aggregate, could reasonably be expected to result in a Material Adverse Effect.

(b)No Loan Party nor any of its Restricted Subsidiaries nor any director, officer or, to the knowledge of such Loan Party, agent, employee or Affiliate of such Loan Party or Restricted Subsidiary, is aware of or has taken any action, directly or indirectly, that would result in a material violation by such persons of the FCPA, including, without limitation, making use of the mails or any means or instrumentality of interstate commerce corruptly in furtherance of an offer, payment, promise to pay or authorization or approval of the payment of any money, or other property, gift, promise to give or authorization of the giving of anything of value, directly or indirectly, to any “foreign official” (as such term is defined in the FCPA) or any foreign political party or official thereof or any candidate for foreign political office in contravention of the FCPA and any applicable anti-corruption law of any Governmental Authority.  Each Loan Party, its Restricted Subsidiaries and their respective Affiliates have conducted their businesses in compliance with, in all material respects, applicable anti-corruption laws of any Governmental Authority and the FCPA and have instituted and maintain and will continue to maintain policies and procedures designed to promote and achieve compliance with such laws and with the representation and warranty contained herein ensure, and which are reasonably expected to continue to ensure, continued compliance therewith.

SECTION 3.09Agreements.

No Company is in default in any manner under any provision of any agreement or instrument to which it is a party or by which it or any of its property is or may be bound (other than any agreement or instrument evidencing Indebtedness), and no condition exists which, with the giving of notice or the lapse of time or both, would constitute such a default, in each case where such default could reasonably be expected to result in a Material Adverse Effect.

SECTION 3.10Federal Reserve Regulations.

No Company is engaged principally, or as one of its important activities, in the business of extending credit for the purpose of buying or carrying Margin Stock.  No part of the proceeds of any Loan or any Letter of Credit will be used, whether directly or indirectly, and whether immediately, incidentally or ultimately, for any purpose that entails a violation of, or that is inconsistent with, the provisions of the regulations of the Board, including Regulation T, U or X.  The pledge of the Securities Collateral pursuant to the Security Agreement does not violate such regulations.

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SECTION 3.11Investment Company Act.

No Company is an “investment company” or a company “controlled” by an “investment company,” as defined in, or subject to regulation under, the Investment Company Act of 1940, as amended.

SECTION 3.12Use of Proceeds.

(a)Borrower will use the proceeds of (a) the Term B Loans made on the Closing Date to effect the Merger, refinance certain existing Indebtedness of the Companies and pay related fees and expenses, (b) any Incremental Term Loans for the purposes specified in the applicable Increase Joinder and (c) the Revolving Loans and Swingline Loans on and after the Closing Date for general corporate purposes (including to effect Permitted Acquisitions), it being understood that the only Revolving Exposure permitted on the Closing Date is Revolving Loans to (i) replace existing letters of credit of the Acquired Business and pay fees and expenses related to the Transactions of up to $5,000,000.

(b)Each Loan Party and its Subsidiaries will not, directly or indirectly, use the proceeds of the Loans, or lend, contribute or otherwise make available such proceeds to any Subsidiary, joint venture partner, other Specified Person, any other person or entity to fund any activities of or business with any Specified Person, any other person or entity, or in any other country or territory that, at the time of such funding, is the subject of sanctions or embargoes under regulations imposed by the United Nations Security Council, the European Union, OFAC, Her Majesty’s Treasury or other relevant sanctions authority (collectively, “Sanctions”), or in any other manner that will result in a violation by any Specified Person (including any Specified Person participating in the transaction, whether as underwriter, advisor, investor or otherwise), any other person or entity of Sanctions.

SECTION 3.13Taxes.

Each Company has (a) timely filed or caused to be timely filed all material U.S. federal Tax Returns and all material state, local and foreign Tax Returns required to have been filed by it and all such Tax Returns are true and correct in all material respects, (b) duly and timely paid, collected or remitted or caused to be duly and timely paid, collected or remitted all Taxes (whether or not shown on any Tax Return) due and payable, collectible or remittable by it and all assessments received by it in writing, except Taxes (i) which are being contested in good faith by appropriate proceedings if such contest operates to suspend collection of the contested Tax and such Company has set aside on its books adequate reserves in accordance with GAAP or (ii) which could not, individually or in the aggregate, have a Material Adverse Effect and (c) satisfied all of its Tax withholding obligations except for failures that could not be reasonably expected to, individually or in the aggregate, result in a Material Adverse Effect.  Each Company has made adequate provision in accordance with GAAP for all material Taxes not yet due and payable.  Each Company is unaware of any proposed or pending Tax assessments, deficiencies or audits that could be reasonably expected to, individually or in the aggregate, result in a Material Adverse Effect.  Except as could not be reasonably expected to, individually or in the aggregate, result in a Material Adverse Effect, no Company has ever “participated” in a “listed transaction” within the meaning of Treasury Regulation Section 1.6011-4.

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SECTION 3.14No Material Misstatements.

No written information furnished by or on behalf of any Company to the Administrative Agent or any Lender in connection with any Credit Extension (including the Confidential Information Memorandum) or any other Loan Document (excluding for this purpose projections and forward-looking statements), taken as a whole, contained or contains any material misstatement of fact or omitted or omits to state any material fact necessary to make the statements therein, in the light of the circumstances under which they were or are made, not misleading as of the date such information is dated or certified (it being understood that this representation is given to the Company’s knowledge with respect to information regarding the Acquired Business provided by or based on information provided by the Seller on or prior to the Closing Date).  The projections and forward-looking statements contained in the materials referenced above are based upon good faith estimates and assumptions believed by management of Borrower to be reasonable at the time made, it being recognized by the Lenders that such financial information as it relates to future events is not to be viewed as fact, are by their nature inherently uncertain and that actual results during the period or periods covered by such financial information may differ from the projected results set forth therein and such differences may be material.

SECTION 3.15Labor Matters.

There are no strikes, lockouts or slowdowns against any Company pending or, to the knowledge of any Company, threatened, which could reasonably be expected to have a Material Adverse Effect.  The hours worked by and payments made to employees of any Company have not been in violation of the Fair Labor Standards Act of 1938, as amended, or any other applicable federal, state, local or foreign law dealing with such matters in any manner which could reasonably be expected to result in a Material Adverse Effect.  All payments due from any Company, or for which any claim may be made against any Company, on account of wages and employee health and welfare insurance and other benefits, have been paid or accrued as a liability on the books of such Company except where the failure to do so could not reasonably be expected to result in a Material Adverse Effect.  Except as set forth on Schedule 3.15, the consummation of the Transactions will not give rise to any right of termination or right of renegotiation on the part of any union under any collective bargaining agreement to which any Company is bound.

SECTION 3.16Solvency.

Immediately after the consummation of the Transactions to occur on the Closing Date and immediately following the making of each Loan and after giving effect to the application of the proceeds of each Loan, (a) the present fair saleable value of the properties of Holdings (on a consolidated basis with its Restricted Subsidiaries) will exceed its debts and liabilities, subordinated, contingent or otherwise; (b) the present fair saleable value of the property of Holdings (on a consolidated basis with its Restricted Subsidiaries) will be greater than the amount that will be required to pay the probable liability of its debts and other liabilities, subordinated, contingent or otherwise, as such debts and other liabilities become absolute and matured; (c) Holdings (on a consolidated basis with its Restricted Subsidiaries) has not incurred and does not intend to incur or believe it will incur, debts and liabilities, subordinated, contingent or otherwise, beyond its ability to pay such debts and liabilities as they become due; and (d) Holdings (on a consolidated

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basis with its Restricted Subsidiaries) will not have unreasonably small capital with which to conduct its business in which it is engaged as such business is now conducted and is proposed to be conducted following the Closing Date.

SECTION 3.17Employee Benefit Plans.

Each Company and its Restricted Subsidiaries is in compliance with the applicable provisions of ERISA and the Code and the regulations and published interpretations thereunder as such provisions apply to any Plan or any employee benefit plan of Company and its Restricted Subsidiaries, except where the failure to comply could not reasonably be expected to have a Material Adverse Effect; and no ERISA Event has occurred or is reasonably expected to occur that, when taken together with all other such ERISA Events, could reasonably be expected to result in a Material Adverse Effect.

To the extent applicable, each Foreign Plan has been maintained in compliance with its terms and with the requirements of any and all applicable Requirements of Law and has been maintained, where required, in good standing with applicable regulatory authorities except where the failure to comply or be maintained in good standing could not reasonably be expected to have a Material Adverse Effect.  No Company has incurred any obligation in connection with the termination of or withdrawal from any Foreign Plan that could reasonably be expected to have a Material Adverse Effect.

SECTION 3.18Environmental Matters.

(a)Except as set forth in Schedule 3.18 and except as, individually or in the aggregate, could not reasonably be expected to have a Material Adverse Effect:

(i)the Companies and their businesses, operations and Real Property are in compliance with, and to the knowledge of the Companies, the Companies have no liability under, any applicable Environmental Law;

(ii)the Companies have obtained all Environmental Permits required for the conduct of their businesses and operations, and the ownership, operation and use of their property, under Environmental Law, and all such Environmental Permits are valid and in good standing;

(iii)there has been no Release or threatened Release of Hazardous Material on, at, under or from any Real Property or facility presently or to the knowledge of the Companies formerly owned, leased or operated by the Companies that could result in liability by the Companies under any applicable Environmental Law;

(iv)there is no Environmental Claim pending or, to the knowledge of the Companies, threatened against the Companies or relating to the Real Property currently or to the knowledge of the Companies formerly owned, leased or operated by the Companies, or relating to the operations of the Companies and to the knowledge of the Companies there are no actions, activities, circumstances, conditions, events or incidents that could form the basis of such an Environmental Claim;

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(v)no person with an indemnity or contribution obligation to the Companies relating to compliance with or liability under Environmental Law is in default with respect to such obligation;

(vi)no Company is obligated to perform any action or otherwise incur any expense under Environmental Law pursuant to any order, decree, judgment or agreement by which it is bound or has assumed by contract, agreement or operation of law, and no Company is conducting or financing any Response pursuant to any Environmental Law with respect to any Real Property or any other location;

(vii)no Real Property or facility owned, operated or leased by the Companies and, to the knowledge of the Companies, no Real Property or facility formerly owned, operated or leased by the Companies is (i) listed or proposed for listing on the National Priorities List promulgated pursuant to CERCLA or (ii) listed on the Comprehensive Environmental Response, Compensation and Liability Information System promulgated pursuant to CERCLA or (iii) included on any similar list maintained by any Governmental Authority including any such list relating to petroleum;

(viii)to the knowledge of the Companies, no Lien has been recorded or threatened in writing under any Environmental Law with respect to any Real Property or other assets of the Companies; and

(ix)the execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby will not require any notification, registration, filing, reporting, disclosure, investigation, remediation or cleanup pursuant to any Governmental Real Property Disclosure Requirements or any other applicable Environmental Law.

(b)As of the Closing Date, the Companies have made available to the Administrative Agent all material and non-privileged records and files in the possession, custody or control of, or otherwise reasonably available to, the Companies concerning compliance with or liability under Environmental Law, including those concerning the actual or suspected existence of Hazardous Material at Real Property or facilities currently owned, operated, leased or used by the Companies.

SECTION 3.19Insurance.

Schedule 3.19 sets forth a true, complete and correct description of all material insurance maintained by each Loan Party as of the Closing Date.  All insurance maintained by the Companies is in full force and effect, all premiums have been duly paid, no Company has, to their knowledge, received notice of violation or cancellation thereof.  Each Company has insurance in such amounts and covering such risks and liabilities as are in accordance with normal industry practice.

SECTION 3.20Security Documents.

(a)Security Agreement.  The Security Agreement is effective to create in favor of the Collateral Agent for the benefit of the Secured Parties, valid and enforceable Liens on, and security

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interests in, the Security Agreement Collateral and, when (i) financing statements and other filings in appropriate form are accepted by the offices specified on Schedule 6 to the Perfection Certificate and (ii) upon the taking of possession or control by the Collateral Agent of the Security Agreement Collateral with respect to which a security interest may be perfected only by possession or control (which possession or control shall be given to the Collateral Agent to the extent possession or control by the Collateral Agent is required by each Security Agreement), the Liens created by the Security Agreement shall constitute fully perfected Liens on, and security interests in, all right, title and interest of the grantors in the Security Agreement Collateral (other than (1) such Security Agreement Collateral in which a security interest cannot be perfected under the UCC as in effect at the relevant time in the relevant jurisdiction and (2) the Intellectual Property (as defined in the Security Agreement)), in each case subject to no Liens other than Permitted Liens.

(b)PTO Filings, Copyright Office Filing.  When the Security Agreement or a short form thereof is filed in the United States Copyright Office and the United States Patent and Trademark Office in the manner prescribed by each office, the Liens created by such Security Agreement shall constitute fully perfected Liens on, and security interests in, all right, title and interest of the grantors thereunder in the Copyrights (as defined in such Security Agreement) registered with the United States Copyright Office or Patents (as defined in the Security Agreement) registered or applied for with the United States Patent and Trademark Office, as the case may be, in each case subject to no Liens other than Permitted Collateral Liens (it being understood that subsequent recordings in the United States Copyright Office or the United States Patent and Trademark Office may be necessary to perfect a Lien on registered trademarks, trademark applications and copyrights acquired by the grantors after the date hereof).

(c)Mortgages.  Each Mortgage is effective to create, in favor of the Collateral Agent, for its benefit and the benefit of the Secured Parties, valid and enforceable first priority Liens on, and security interests in, all of the Loan Parties’ right, title and interest in and to the Mortgaged Properties thereunder and the proceeds thereof, subject only to Permitted Collateral Liens or other Liens acceptable to the Collateral Agent.

(d)Valid Liens.  Each Security Document delivered after the Closing Date pursuant to Sections 5.11, 5.12 and 5.16 will, upon execution and delivery thereof, be effective to create in favor of the Collateral Agent, for the benefit of the Secured Parties, legal, valid and enforceable Liens on, and security interests in, all of the Loan Parties’ right, title and interest in and to the Collateral thereunder, and (i) when all appropriate filings or recordings are accepted by the appropriate offices as may be required under applicable law and (ii) upon the taking of possession or control by the Collateral Agent of such Collateral with respect to which a security interest may be perfected only by possession or control (which possession or control shall be given to the Collateral Agent to the extent required by any Security Document), such Security Document will constitute fully perfected Liens on, and security interests in, such Collateral in which a Loan Party has rights and in which a security interest can be created and perfected under the UCC as in effect at the relevant time and in the relevant jurisdiction, in each case subject to no Liens other than the applicable Permitted Collateral Liens.

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SECTION 3.21Merger Documents.

Schedule 3.21 lists as of the Closing Date, (i) each exhibit, schedule, annex or other attachment to the Merger Agreement and (ii) each material agreement or other material document that is being delivered in satisfaction of the conditions precedent to the consummation of the Merger.  The Administrative Agent has been furnished true and complete copies of each Merger Document to the extent executed and delivered on or prior to the Closing Date.

SECTION 3.22Anti-Terrorism Laws.

(a)Except as otherwise disclosed on Schedule 3.23, no Loan Party nor any of its Subsidiaries (i) has violated or is in violation of Anti-Terrorism Laws or (ii) has engaged or engages in any transaction, investment, undertaking or activity that violates the Anti-Terrorism Laws.

(b)The funds used by the Loan Parties to pay the Lenders will not be derived from activities that violate Anti-Terrorism Laws.

(c)No Loan Party, nor any of its Subsidiaries acting or benefiting in any capacity in connection with the Loans is an Embargoed Person.

(d)Except as otherwise disclosed on Schedule 3.23, no Loan Party, nor any of its Subsidiaries, (i) conducts any business or engages in making or receiving any contribution of funds, goods or services to or for the benefit of any Embargoed Person or person subject to Sanctions, (ii) deals in, or otherwise engages in any transaction related to, any property or interests in property blocked pursuant to any Anti-Terrorism Law or (iii) engages in or conspires to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate any Anti-Terrorism Law.

SECTION 3.23No Conflict with Customs, International Trade and OFAC Laws.

(a)No Loan Party nor any of its Subsidiaries, any director, officer, nor to the knowledge of the Loan Parties after reasonable due diligence, employee, agent, Affiliate or representative of such Loan Party or Subsidiary (each, a “Specified Person”) is an Embargoed Person or subject to Sanctions, nor is any Loan Party or any of its Subsidiaries located, organized or resident in a country or territory that is the subject of Sanctions.

(b)Except as otherwise disclosed in Schedule 3.23, each of the Loan Parties and its Subsidiaries is in compliance with, in all material respects, and has not committed any material violation in the five years preceding the Closing Date, of applicable law or regulation, permit, order or other decision or requirement having the force or effect of law or regulation of any governmental entity concerning the importation of products, the exportation or re-exportation of products (including technology and services), the terms and conduct of international transactions and the making or receiving of international payments, namely, as applicable, the Tariff Act of 1930, as amended, and other laws, regulations and programs administered or enforced by U.S. Customs and Border Protection and U.S. Immigration and Customs Enforcement, and their predecessor agencies, the Export Administration Act of 1979, as amended, the Export Administration Regulations, the International Emergency Economic Powers Act, as amended, the Trading

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With the Enemy Act, as amended, the Arms Export Control Act, as amended, the International Traffic in Arms Regulations, Executive Orders of the President regarding embargoes and restrictions on transactions with designated entities, the embargoes and restrictions administered by OFAC, the anti-boycott Laws administered by the U.S. Department of Commerce and the anti-boycott Laws administered by the U.S. Department of the Treasury.

ARTICLE IV.

CONDITIONS TO CREDIT EXTENSIONS

SECTION 4.01Conditions to Initial Credit Extension.

The obligation of each Lender and, if applicable, each Issuing Bank to fund the initial Credit Extension requested to be made by it shall be subject to the prior or concurrent satisfaction of each of the conditions precedent set forth in this Section 4.01.

(a)Loan Documents.  The Loan Documents shall be reasonably satisfactory to the Administrative Agent.  There shall have been delivered to the Administrative Agent by the Loan Parties an executed counterpart of each of the Loan Documents and the Perfection Certificate, except for Security Documents not required to be delivered on the Closing Date and listed (or pursuant to the provisions of paragraphs (m) and (n) of this Section 4.01, deemed listed) on Schedule 5.16.

(b)Corporate Documents.  The Administrative Agent shall have received:

(i)a certificate of the secretary or assistant secretary of each Loan Party dated the Closing Date, certifying (A) that attached thereto is a true and complete copy of each Organizational Document of such Loan Party certified (to the extent applicable) as of a recent date by the Secretary of State of the state of its organization, (B) that attached thereto is a true and complete copy of resolutions duly adopted by the Board of Directors, of such Loan Party authorizing the execution, delivery and performance of the Loan Documents to which such person is a party and, in the case of Borrower, the borrowings hereunder, and that such resolutions have not been modified, rescinded or amended and are in full force and effect, (C) as to the incumbency and specimen signature of each officer executing any Loan Document or any other document delivered in connection herewith on behalf of such Loan Party (together with a certificate of another officer as to the incumbency and specimen signature of the secretary or assistant secretary executing the certificate in this clause (i)) and (D) with respect to Borrower, that attached thereto is a true and complete copy of the Advisory Agreement and that, as of the Closing Date, there have been no amendments or modifications thereto; and

(ii)a certificate as to the good standing of each Loan Party (in so-called “long-form” if available) as of a recent date, from such Secretary of State (or other applicable Governmental Authority).

(c)Officers’ Certificate.  The Administrative Agent shall have received a certificate, dated the Closing Date and signed by the chief executive officer and the chief financial officer of

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Borrower, confirming compliance with the conditions precedent set forth in this Section 4.01(p) and (q).

(d)Financings and Other Transactions, etc.

(i)The Transactions shall have been consummated or shall be consummated simultaneously on the Closing Date, in each case in all material respects in accordance with Requirements of Law and the terms of the Merger Agreement, without the waiver or amendment of any terms contained in the definitive Merger Agreement as in effect on November 24, 2010, adverse in any material respect to the Lenders not approved by the Administrative Agent and the Arranger it being understood and agreed that (x) none of the following are materially adverse to the Lenders: (i) a reduction of less than 10% in the consideration payable under the Merger Agreement and (ii) an increase in such purchase price amount funded solely by an increase in the Equity Financing and (y) any change in the purchase price amount other than those described in clause (x) is deemed to be materially adverse to the Lenders.

(ii)The Equity Financing shall have been consummated, and the terms and documentation of the Equity Financing (to the extent it does not consist of the issuance of common stock by Holdings or by Borrower to Holdings) shall be reasonably satisfactory to the Arranger.

(e)Financial Statements; Pro Forma Balance Sheet; Projections.  The Administrative Agent shall have received the following:

(i) within 45 days after the end of each fiscal quarter of the current fiscal year starting with the fiscal quarter ending on or about December 31, 2010, the unaudited consolidated balance sheets and related statements of income, stockholders’ equity and cash flows of the Acquired Business as of and for such fiscal quarter, for the period elapsed from the beginning of the current fiscal year to the end of such fiscal quarter and for the comparable period of the preceding fiscal year, which financial statements shall have been prepared on a basis consistent in all material respects with the quarterly financial statements filed by the Acquired Business with the Securities and Exchange Commission prior to November 24, 2010 (it being understood that the requirements of this clause (i) shall be deemed satisfied by the filing of the Acquired Business of its Form 10-Q containing such financial statements within the time period specified herein);

(ii)Borrower’s unaudited pro forma consolidated balance sheet and statements of income and cash flows and pro forma EBITDA, for the fiscal year ended October 1, 2010, and as of and for the latest four-quarter period ending on the last day covered by the quarterly financials required by Section 4.01(e)(ii), in each case after giving effect to the Transactions as if they had occurred on such date in the case of the balance sheet and as of the beginning of all periods presented in the case of the statements of income and cash flows.  The pro forma financial statements delivered pursuant to this Section 4.01(e)(ii) shall have been prepared on a basis consistent in all material respects with the financial statements required by Section 4.01(e)(i) and the audited consolidated balance sheets and related statements of income, stockholders’ equity and cash flows of the

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Acquired Business for the fiscal year ended October 1, 2010, and shall otherwise be reasonably acceptable to the Administrative Agent; and

(iii)forecasts of the financial performance of Borrower and its Subsidiaries (x) on an annual basis, through 2016 and (y) on a quarterly basis, through the end of the 2012 fiscal year.

(f)[Reserved].

(g)Opinions of Counsel.  The Administrative Agent shall have received, on behalf of itself, the other Agents, the Arranger, the Lenders and the Issuing Bank, a customary written opinion of (i) Skadden, Arps, Slate, Meagher & Flom LLP, special counsel for the Loan Parties, (ii) each local counsel listed on Schedule 4.01(g), in each case (A) dated the Closing Date and (B) addressed to the Agents, the Issuing Bank and the Lenders.

(h)Solvency Certificate.  The Administrative Agent shall have received a solvency certificate in the form of Exhibit O, dated the Closing Date and signed by the chief financial officer of Borrower.

(i)[Reserved].

(j)[Reserved].

(k)Fees.  The Arranger, Administrative Agent, Collateral Agent and Lenders shall have received all Fees, the other fees payable pursuant to the Fee Letter and other amounts due and payable on or prior to the Closing Date, including, to the extent invoiced, reimbursement or payment of all out-of-pocket expenses (including the reasonable legal fees and expenses of Cahill Gordon & Reindel LLP, special counsel to the Agents, and the reasonable fees and expenses of any reasonably necessary local counsel, appraisers, consultants and other advisors, in each case, retained after consultation with Borrower) required to be reimbursed or paid by Borrower hereunder or under any other Loan Document or under the Commitment Letter.

(l)Personal Property Requirements.  The Collateral Agent shall have received:

(i)all certificates, agreements or instruments representing or evidencing the Securities Collateral accompanied by instruments of transfer and stock powers undated and endorsed in blank;

(ii)promissory notes evidencing all intercompany debt owed to any Loan Party executed by the applicable Companies, accompanied by instruments of transfer undated and endorsed in blank;

(iii)all other certificates, agreements, approvals or instruments necessary to perfect the Collateral Agent’s security interest in all Chattel Paper, all Instruments, and all Investment Property of each Loan Party (as each such term is defined in the Security Agreement and to the extent required by the Security Agreement);

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(iv)UCC financing statements in appropriate form for filing under the UCC, PPSA filings under the PPSA of the applicable provinces, filings with the United States Patent and Trademark Office and United States Copyright Office and such other documents under applicable Requirements of Law in each jurisdiction as may be necessary or appropriate or, in the opinion of the Collateral Agent, desirable to perfect the Liens created, or purported to be created, by the Security Documents;

(v)certified copies of UCC, United States Patent and Trademark Office and United States Copyright Office, tax and judgment lien searches, each of a recent date listing all effective financing statements that name any Loan Party as debtor and that are filed in those jurisdictions in which any Loan Party is organized or maintains its chief executive office and such other searches that the Collateral Agent deems necessary or appropriate, none of which encumber the Collateral covered or intended to be covered by the Security Documents (other than Permitted Collateral Liens or any other Liens acceptable to the Collateral Agent); and

(vi)evidence acceptable to the Collateral Agent of payment or arrangements for payment by the Loan Parties of all applicable recording taxes, fees, charges, costs and expenses required for the recording of the Security Documents;

provided, however, that, other than with respect to any UCC Filing Collateral, Stock Certificates and IP Filing Collateral, to the extent any security interest in the Collateral is not perfected on the Closing Date after the Loan Parties’ use of commercially reasonable efforts to do so, the perfection of such security interests shall not constitute a condition precedent to the initial Credit Extension if the Loan Parties agree to deliver or cause to be delivered such documents and instruments, and take or cause to be taken such other actions as may be required to perfect such security interests, within 90 days after the Closing Date or such later date as may be agreed by the Administrative Agent, acting in its reasonable discretion, in writing (in which case such documents and instruments shall be deemed added to Schedule 5.16).

(m)Real Property Requirements.  The Collateral Agent shall have received:

(i)a Mortgage encumbering each Mortgaged Property in favor of the Collateral Agent, for the benefit of the Secured Parties, duly executed and acknowledged by each Loan Party that is the owner of or holder of any interest in such Mortgaged Property, and otherwise in form for recording in the recording office of each applicable political subdivision where each such Mortgaged Property is situated, together with such certificates, affidavits, questionnaires or returns as shall be required in connection with the recording or filing thereof to create a lien under applicable Requirements of Law, and such financing statements and any other instruments necessary to grant a mortgage lien under the laws of any applicable jurisdiction, all of which shall be in form and substance reasonably satisfactory to Collateral Agent;

(ii)with respect to each Mortgaged Property, such consents, approvals, amendments, supplements, estoppels or other instruments as necessary to consummate the Transactions or as shall reasonably be deemed necessary by the Collateral Agent in order for the owner or holder of the fee or leasehold interest constituting such Mortgaged

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Property to grant the Lien contemplated by the Mortgage with respect to such Mortgaged Property;

(iii)with respect to each Mortgage, an American Land Title Association Mortgagee policy of title insurance (or marked up title insurance commitment having the effect of a policy of title insurance) insuring the Lien of such Mortgage as a valid first mortgage Lien on the Mortgaged Property and fixtures described therein in an amount equal to the fair market value of such Mortgaged Property and fixtures, which fair market value is set forth on Schedule 4.01(m)(iii), which policy (or such marked-up commitment) (each, a “Title Policy”) shall (A) be issued by the Title Company, (B) to the extent necessary, include such reinsurance arrangements (with provisions for direct access, if necessary) as shall be reasonably acceptable to the Collateral Agent, (C) contain a “tie-in” or “cluster” endorsement, if available under applicable law (i.e., policies which insure against losses regardless of location or allocated value of the insured property up to a stated maximum coverage amount), (D) have been supplemented by such endorsements as shall be reasonably requested by the Collateral Agent (including endorsements on matters relating to usury, first loss, last dollar, zoning, contiguity, revolving credit, doing business, non-imputation, public road access, survey, variable rate, environmental lien, subdivision, mortgage recording tax, separate tax lot, revolving credit, and so-called comprehensive coverage over covenants and restrictions), and (E) contain no exceptions to title other than Permitted Collateral Liens;

(iv)with respect to each Mortgaged Property, such affidavits, certificates, information (including financial data) and instruments of indemnification (including a so-called “gap” indemnification) as shall be reasonably required to induce the Title Company to issue the Title Policy/ies and endorsements contemplated above;

(v)evidence reasonably acceptable to the Collateral Agent of payment by Borrower of all Title Policy premiums, search and examination charges, escrow charges and related charges, mortgage recording taxes, fees, charges, costs and expenses required for the recording of the Mortgages and issuance of the Title Policies referred to above;

(vi)with respect to each Mortgaged Property, each Company shall have made all notifications, registrations and filings, to the extent required by, and in accordance with, all Governmental Real Property Disclosure Requirements applicable to such Mortgaged Property.

(vii)Surveys that include a completed Federal Emergency Management Agency Standard Flood Hazard Determination with respect to each Mortgaged Property; it being agreed that notwithstanding the foregoing of this Section 4.01(m)(vii), (A) with respect to the Mortgaged Property identified on Schedule 7(a) to the Perfection Certificate as being located in Palo Alto, California, the requirements of this Section 4.01(m)(vii) shall be deemed satisfied by the delivery by Borrower or one of its Subsidiaries to the Title Company of an Affidavit of No Change to Survey with respect to the survey of such Mortgaged Property performed by Kier & Wright Civil Engineers & Surveyors, Inc., Job No. A04011, initially dated February of 2004 and last revised on November 16, 2004 which is sufficient to cause the Title Company to issue the Title Policy for such

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Mortgaged Property without the standard survey exception, and (B) with respect to the Mortgaged Property identified on Schedule 7(a) to the Perfection Certificate as being located in Beverly, Massachusetts, the requirements of this Section 4.01(m)(vii) shall be deemed satisfied by the delivery by Borrower or one of its Subsidiaries to the Title Company of an Affidavit of No Change to Survey with respect to the survey of such Mortgaged Property performed by Hancock Associates, Project No. 8476, initially dated February 13, 2004 and last revised on January 31, 2005 which is sufficient to cause the Title Company to issue the Title Policy for such Mortgaged Property without the standard survey exception.

provided, however, that to extent the requirements of this Section 4.01(m) or 4.01(g)(ii) are not satisfied after the Loan Parties’ use of commercially reasonable efforts to do so, the requirements of this Section 4.01(m) shall not constitute a condition precedent to the initial Credit Extension if the Loan Parties agree to deliver or cause to be delivered such documents and instruments, and take or cause to be taken such other actions as may be required to satisfy Section 4.01(m) or 4.01(g)(ii), within 90 days after the Closing Date or such later date as may be agreed by the Administrative Agent, acting in its reasonable discretion, in writing (in which case such documents and instruments shall be deemed added to Schedule 5.16 and be subject to the time period set forth in this proviso).

(n)Insurance.  The Administrative Agent shall have received a copy of, or a certificate as to coverage under, the insurance policies required by Section 5.04 and the applicable provisions of the Security Documents, each of which shall be endorsed or otherwise amended to include a “standard” or “New York” lender’s loss payable or mortgagee endorsement (as applicable) and shall name the Collateral Agent, on behalf of the Secured Parties, as additional insured, in form and substance reasonably satisfactory to the Administrative Agent.

(o)USA PATRIOT Act.  The Lenders and the Administrative Agent shall have timely received the information required under Section 10.13 that has been requested in writing at least five Business Days prior to the Closing Date.

(p)Business Material Adverse Effect.  Except as qualified or supplemented by the reports filed by the Acquired Business with the Securities and Exchange Commission after October 2, 2009 and prior to November 24, 2010 (excluding any disclosures set forth in any section of any such filing entitled “Risk Factors” or “Forward-Looking Statements” or any other disclosures included in such filings to the extent that they are forward-looking in nature and do not contain a reasonable level of detail about the risks of which the statements warn) or (b) the Company Disclosure Letter delivered by the Acquired Business in connection with the Merger Agreement, since October 2, 2009, there shall not have occurred and be continuing any Business Material Adverse Effect.

(q)Accuracy of Merger Agreement Representations and Specified Representations. The representations made by the Acquired Business and its Subsidiaries (as defined in the Merger Agreement) in the Merger Agreement that are material to the interests of the Lenders, but only to the extent that Borrower (or any of its affiliates) has the right not to consummate the Transaction or to terminate its obligations under the Merger Agreement as a result of a breach or inaccuracy of such representations in the Merger Agreement (the “Merger Agreement

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Representations”), and the Specified Representations (as defined below), shall be true and correct in all material respects (except that any representation and warranty that is qualified as to “materiality” or “Material Adverse Effect” shall be true and correct in all respects) on and as of the date of such Credit Extension with the same effect as though made on and as of such date, except to the extent such representations and warranties expressly relate to an earlier date.  For purposes hereof, “Specified Representations” means the representations and warranties relating to Holdings and its Subsidiaries set forth in Sections 3.01(a), 3.02 with respect to the Loan Documents, 3.03(b) with respect to the Loan Documents or (c) with respect to the Loan Documents, 3.10, 3.11, 3.16, 3.20 (but only to the extent relating to Collateral in which a Lien in favor of the Collateral Agent is required to be perfected by the Closing Date pursuant to clauses (l) and (m) above), and 3.22 (limited to the Patriot Act).

(r)Certain conditions precedent in Section 4.02.  Satisfaction of the condition precedent in Section 4.02(a) and (d).

(s)Confidential Information Memorandum.  The Arranger shall have received the final Confidential Information Memorandum at least 21 days prior to the Closing Date.

SECTION 4.02Conditions to All Credit Extensions.

The obligation of each Lender and each Issuing Bank to make any Credit Extension (excluding the initial Credit Extension) shall be subject to, and to the satisfaction of, each of the conditions precedent set forth below.

(a) Notice.  The Administrative Agent shall have received a Borrowing Request as required by Section 2.03 (or such notice shall have been deemed given in accordance with Section 2.03) if Loans are being requested or, in the case of the issuance, amendment, extension or renewal of a Letter of Credit, the Issuing Bank and the Administrative Agent shall have received an LC Request as required by Section 2.18(b) or, in the case of the Borrowing of a Swingline Loan, the Swingline Lender and the Administrative Agent shall have received a Borrowing Request as required by Section 2.17(b).

(b)No Default.  At the time of and immediately after giving effect to such Credit Extension and the application of the proceeds thereof, no Default or Event of Default shall have occurred and be continuing on such date.

(c)Representations and Warranties.  Each of the representations and warranties made by any Loan Party set forth in Article III hereof or in any other Loan Document shall be true and correct in all material respects (except that any representation and warranty that is qualified as to “materiality” or “Material Adverse Effect” shall be true and correct in all respects) on and as of the date of such Credit Extension with the same effect as though made on and as of such date, except to the extent such representations and warranties expressly relate to an earlier date.

(d)USA Patriot Act. With respect to Letters of Credit issued for the account of a Restricted Subsidiary only, the Lenders and the Administrative Agent shall have timely received the information required under Section 10.13.

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Each of the delivery of a Borrowing Request or an LC Request and the acceptance by Borrower of the proceeds of such Credit Extension (other than those for the initial Credit Extension on the Closing Date) shall constitute a representation and warranty by Borrower and each other Loan Party that on the date of such Credit Extension (both immediately before and after giving effect to such Credit Extension and the application of the proceeds thereof) the conditions contained in Sections 4.02(b)-(d) have been satisfied.

The making of Credit Extensions hereunder shall not be subject to conditions or requirements that are not set forth in the Loan Documents, and to the extent such conditions or requirements shall have been satisfied or complied with, as the case may be, the making of such Credit Extensions shall be nondiscretionary.

ARTICLE V.

AFFIRMATIVE COVENANTS

Each Loan Party covenants and agrees with each Lender that so long as this Agreement shall remain in effect and until the Commitments have been terminated and the principal of and interest on each Loan, all Fees and all other expenses or amounts due and payable under any Loan Document shall have been paid in full (other than contingent indemnification obligations for which no claim has been asserted) and all Letters of Credit have been canceled or have expired or been fully cash collateralized and all amounts drawn thereunder have been reimbursed in full, unless the Required Lenders shall otherwise consent in writing, each Loan Party will, and will cause each of its Restricted Subsidiaries to:

SECTION 5.01Financial Statements, Reports, etc.

Furnish to the Administrative Agent:

(a)Annual Reports.  Within 90 days after the end of each fiscal year, beginning with the fiscal year ending on or about September 30, 2011, (i) the consolidated balance sheet of Holdings as of the end of such fiscal year and related consolidated statements of income, cash flows and stockholders’ equity for such fiscal year, in comparative form with such financial statements as of the end of, and for, the preceding fiscal year, and notes thereto, all prepared in accordance with GAAP and accompanied by an opinion of a “big four” accounting firm or other independent public accountants of recognized national standing reasonably satisfactory to the Administrative Agent (which opinion shall not be qualified as to scope or contain any going concern or other qualification, other than a qualification related to the maturity of Loans at the Revolving Maturity Date, the Term B Loan Maturity Date or the Final Maturity Date, as applicable) stating that such financial statements fairly present, in all material respects, the consolidated financial condition, results of operations and cash flows of Holdings as of the dates and for the periods specified in accordance with GAAP (such opinion, an “Acceptable Opinion”), (ii) a management report in a form reasonably satisfactory to the Administrative Agent setting forth statement of income items and Consolidated EBITDA of Holdings for such fiscal year, showing variance, by dollar amount and percentage, from amounts for the previous fiscal year and budgeted amounts and (iii) a narrative report and management’s

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discussion and analysis, in a form reasonably satisfactory to the Administrative Agent, of the financial condition and results of operations of Holdings for such fiscal year, as compared to amounts for the previous fiscal year and budgeted amounts (it being understood that the requirements of clause (a)(i) shall be deemed satisfied by the filing of a Form 10-K of Holdings in respect of such fiscal year with the U.S. Securities and Exchange Commission, so long as such Form 10-K (x) is publicly available on the Internet without charge, (y) is filed on or before the 90th day following the end of such fiscal year and (z) contains an Acceptable Opinion);

(b)Quarterly Reports.  Within 45 days after the end of each of the first three fiscal quarters of each fiscal year, beginning with the fiscal quarter ending on or about January 1, 2011, (i) the consolidated balance sheet of Holdings as of the end of such fiscal quarter and related consolidated statements of income and cash flows for such fiscal quarter and for the then elapsed portion of the fiscal year, in comparative form with the consolidated statements of income and cash flows for the comparable periods in the previous fiscal year (provided that with respect to any fiscal quarter that ends on or prior to the first anniversary of the Closing Date, the foregoing requirement that such financial statements be presented in comparative form shall only apply to the extent financial statements of Holdings or the Acquired Business exist for such comparable periods in the previous fiscal year), and notes thereto, all prepared in accordance with GAAP and accompanied by a certificate of a Financial Officer stating that such financial statements fairly present, in all material respects, the consolidated financial condition, results of operations and cash flows of Holdings as of the date and for the periods specified in accordance with GAAP consistently applied, and on a basis consistent with audited financial statements for the fiscal year ended on or about September 30, 2010, subject to normal year-end audit adjustments, (ii) a management report in a form reasonably satisfactory to the Administrative Agent setting forth statement of income items and Consolidated EBITDA of Holdings for such fiscal quarter and for the then elapsed portion of the fiscal year, showing variance, by dollar amount and percentage, from amounts for the comparable periods in the previous fiscal year and budgeted amounts, and (iii) a narrative report and management’s discussion and analysis, in a form reasonably satisfactory to the Administrative Agent, of the financial condition and results of operations for such fiscal quarter and the then elapsed portion of the fiscal year, as compared to the comparable periods in the previous fiscal year and budgeted amounts (it being understood that the requirements of clause (b)(i) shall be deemed satisfied by the filing of a Form 10-Q of Holdings in respect of such fiscal quarter with the U.S. Securities and Exchange Commission, so long as such Form 10-Q (x) is publicly available on the Internet without charge and (y) is filed on or before the 45th day following the end of such fiscal quarter);

(c)Financial Officer’s Certificate.  (i) Concurrently with any delivery of financial statements under Section 5.01(a) or (b), a Compliance Certificate (A) certifying that no Default has occurred or, if such a Default has occurred, specifying the nature and extent thereof and any corrective action taken or proposed to be taken with respect thereto, (B) beginning with the fiscal quarter ending on or about March 31, 2011, setting forth computations in reasonable detail reasonably satisfactory to the Administrative Agent demonstrating compliance with the covenants contained in Sections 6.09(a) and (b) and, in a case of a delivery of financial statements pursuant to Section 5.01(a), Section 6.09(c)

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and, concurrently with any delivery of financial statements under Section 5.01(a) above (beginning with the fiscal year ending on or about September 30, 2012), setting forth Borrower’s calculation of Excess Cash Flow and (C) showing a reconciliation of Consolidated EBITDA to the net income set forth on the statement of income; and (ii) concurrently with any delivery of financial statements under Section 5.01(a) above, beginning with the fiscal year ending on or about September 30, 2011, a report of the accounting firm opining on or certifying such financial statements stating that in the course of its regular audit of the financial statements of Holdings and its Subsidiaries, which audit was conducted in accordance with generally accepted auditing standards, such accounting firm obtained no knowledge that any Default insofar as it relates to Section 6.09 has occurred or, if in the opinion of such accounting firm such a Default has occurred, specifying the nature and extent thereof;

(d)           Public Reports.  Promptly after the same become publicly available, copies of all periodic and other reports, proxy statements and other materials filed by any Company with the Securities and Exchange Commission, or any Governmental Authority succeeding to any or all of the functions of said Commission, or with any national securities exchange;

(e)           Management Letters.  Promptly after the receipt thereof by any Company, a copy of any “management letter” received by any such person from its certified public accountants and the management’s responses thereto;

(f)            Budgets.  Within 90 days after the beginning of each fiscal year commencing on or about October 1, 2011, a budget for Holdings in form reasonably satisfactory to the Administrative Agent, but to include balance sheets, statements of income and sources and uses of cash, for each month of such fiscal year prepared in detail, with appropriate presentation and discussion of the principal assumptions upon which such budget is based, accompanied by the statement of a Financial Officer of Borrower to the effect that the budget of Holdings is a reasonable estimate for the periods covered thereby and, promptly when available, any significant revisions of such budget;

(g)           Organization.  Concurrently with any delivery of financial statements under Section 5.01(a), confirmation that there are no changes to Schedule 9(a) to the Perfection Certificate;

(h)           [Reserved];

(i)            Unrestricted Subsidiaries.  Simultaneously with the delivery of financial statements referred to in Sections 5.01(a) and (b) above, if during any of the periods covered by the statement of income contained therein Borrower shall have one or more Unrestricted Subsidiaries, then such financial statements shall contain a footnote with information in reasonable detail summarizing the differences between the financial statements delivered pursuant to Sections 5.01(a) and (b)  and the results of operations and financial condition of Borrower and its Restricted Subsidiaries without giving effect to the results or condition of any such Unrestricted Subsidiaries; and

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(j)            Other Information.  Promptly, from time to time, such other material information regarding the operations, business affairs and financial condition of any Company, or compliance with the terms of any Loan Document, as the Administrative Agent or any Lender may reasonably request.

SECTION 5.02              Litigation and Other Notices.

Furnish to the Administrative Agent written notice of the following promptly after any Responsible Officer of Holdings acquires knowledge thereof:

(a)           any Default, specifying the nature and extent thereof and the corrective action (if any) taken or proposed to be taken with respect thereto;

(b)           the filing or commencement of, or any written threat or written notice of intention of any person to file or commence, any action, suit, litigation or proceeding, whether at law or in equity by or before any Governmental Authority, (i) against any Company thereof that could reasonably be expected to result in a Material Adverse Effect or (ii) with respect to any Loan Document;

(c)           any development that has resulted in, or could reasonably be expected to result in a Material Adverse Effect; and

(d)           the occurrence of a Casualty Event resulting in a loss exceeding $5,000,000.

SECTION 5.03              Existence; Businesses and Properties.

(a)           Do or cause to be done all things necessary to preserve, renew and maintain in full force and effect its legal existence, except as otherwise expressly permitted under Section 6.05 or Section 6.06 or, in the case of any Restricted Subsidiary, where the failure to perform such obligations, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect.

(b)           Do or cause to be done all things necessary to obtain, preserve, renew, extend and keep in full force and effect the rights, licenses, permits, privileges, franchises, authorizations, patents, copyrights, trademarks and trade names material to the conduct of its business; pay and perform its obligations under all Leases (except where the failure to pay or perform, individually or in the aggregate, could not reasonably be expected to result in a Material Adverse Effect); and except as could not reasonably be expected to result in a Material Adverse Effect, at all times maintain, preserve and protect all property material to the conduct of such business and keep such property in good repair, working order and condition (other than wear and tear occurring in the ordinary course of business) and from time to time make, or cause to be made, all repairs, renewals, additions, improvements and replacements thereto reasonably necessary in order that the business carried on in connection therewith may be properly conducted at all times; provided that nothing in this Section 5.03(b) shall prevent (i) sales of property, consolidations or mergers by or involving any Company in accordance with Section 6.05 or Section 6.06; (ii) the withdrawal or failure by any Company of its qualification as a foreign corporation in any jurisdiction where such withdrawal, individually or in the aggregate, could not reasonably be expected to re-

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sult in a Material Adverse Effect; or (iii) the abandonment or any other failure to obtain, preserve, renew, extend or keep in full force and effect by any Company of any rights, licenses, permits, privileges, franchises, authorizations, patents, copyrights, trademarks or trade names that such person reasonably determines are not useful to its business or no longer commercially desirable.

SECTION 5.04              Insurance.

(a)           Generally.  Maintain such insurance, with financially sound and reputable insurers, in such amounts, to such extent and against such risks as is customary for companies in the same or similar businesses operating in the same or similar locations.

(b)           Requirements of Insurance.  All such insurance with respect to Collateral shall name the Collateral Agent as mortgagee (in the case of real property insurance) or additional insured on behalf of the Secured Parties (in the case of liability insurance) or loss payee (in the case of property insurance), as applicable.

(c)           Notice to Agents.  (i) Notify the Administrative Agent and the Collateral Agent promptly whenever any material separate insurance concurrent in form or contributing in the event of loss with that required to be maintained under this Section 5.04 is taken out by any Loan Party; and promptly deliver to the Administrative Agent and the Collateral Agent a duplicate original copy of such policy or policies, (ii) use commercially reasonable efforts to provide 30 days’ notice to the Administrative Agent prior to cancellation of any insurance coverage with respect to the Collateral by any Loan Party and (iii) provide prompt written notice after the date of such cancellation in the event of cancellation of any insurance coverage with respect to the Collateral by an insurer.

(d)           Flood Insurance.  With respect to each Mortgaged Property, obtain flood insurance in such total amount as the Administrative Agent or the Required Lenders may from time to time reasonably require, if at any time the area in which any improvements located on any Mortgaged Property is designated a “flood hazard area” in any Flood Insurance Rate Map published by the Federal Emergency Management Agency (or any successor agency), and otherwise comply with the National Flood Insurance Program as set forth in the Flood Disaster Protection Act of 1973, as amended from time to time.

(e)           Mortgaged Properties.  No Loan Party that is an owner of Mortgaged Property shall take any action that is reasonably likely to be the basis for termination, revocation or denial of any insurance coverage required to be maintained under such Loan Party’s respective Mort gage or that is reasonably likely to be the basis for a valid defense to any claim under any Insurance Policy maintained in respect of the Premises, and each Loan Party shall otherwise comply in all material respects with all Insurance Requirements in respect of the Premises; provided, however, that each Loan Party may, at its own expense and after written notice to the Administrative Agent, (i) contest the applicability or enforceability of any such Insurance Requirements by appropriate legal proceedings, the prosecution of which does not constitute a basis for cancellation or revocation of any insurance coverage required under this Section 5.04 or (ii) cause the Insurance Policy containing any such Insurance Requirement to be replaced by a new policy complying with the provisions of this Section 5.04.

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SECTION 5.05              Obligations and Taxes.

(a)           Payment of Obligations.  Pay its obligations (other than Indebtedness obligations) promptly and in accordance with their terms and pay and discharge promptly when due all material Taxes, assessments and governmental charges or levies imposed upon it or upon its income or profits or in respect of its property, before the same shall become delinquent or in default, as well as all lawful claims for labor, services, materials and supplies or otherwise that, if unpaid, might give rise to a Lien other than a Permitted Lien upon such properties or any part thereof; provided that such payment and discharge shall not be required with respect to any such obligation, Tax, assessment, charge, levy or claim so long as (x)(i) the validity or amount thereof shall be contested in good faith by appropriate proceedings and the applicable Company shall have set aside on its books adequate reserves or other appropriate provisions with respect thereto in accordance with GAAP and (ii) such contest operates to suspend collection of the contested obligation, Tax, assessment or charge and enforcement of a Lien other than a Permitted Lien and (y) the failure to pay could not reasonably be expected to, individually or in the aggregate, to result in a Material Adverse Effect.

(b)           Filing of Returns.  Timely and correctly file all material Tax Returns required to be filed by it and withhold, collect and remit all Taxes that it is required to collect, withhold or remit.

SECTION 5.06              Employee Benefits.

(a)           Furnish to the Administrative Agent (x) as soon as possible after, and in any event within 15 days after any Responsible Officer of any Company or any ERISA Affiliates of any Company knows or has reason to know that, any ERISA Event has occurred that, alone or together with any other ERISA Event, could reasonably be expected to result in either liability of the Companies or any of their ERISA Affiliates in an aggregate amount for all of the Companies and their ERISA Affiliates exceeding $1,000,000 or in the imposition of a Lien, a statement of a Financial Officer of Borrower setting forth details as to such ERISA Event and the action, if any, that the Companies propose to take with respect thereto and (y) upon request by the Administrative Agent, copies of (i) each Schedule B (Actuarial Information) to the annual report (Form 5500 Series) filed by any Company or any ERISA Affiliate with the Internal Revenue Service with respect to each Plan; (ii) the most recent actuarial valuation report for each Plan; (iii) all notices received by any Company or any ERISA Affiliate from a Multiemployer Plan sponsor or any governmental agency concerning an ERISA Event; and (iv) such other documents or governmental reports or filings relating to any Plan (or employee benefit plan sponsored or contrib uted to by any Company) as the Administrative Agent shall reasonably request and (z) promptly following any request therefor, copies of (i) any documents described in Section 101(k) of ERISA that any Company or its ERISA Affiliate may request with respect to any Multiemployer Plan and (ii) any notices described in Section 101(1) of ERISA that any Company or its ERISA Affiliate may request with respect to any Multiemployer Plan; provided that if any Company or its ERISA Affiliate has not requested such documents or notices from the administrator or sponsor of the applicable Multiemployer Plan, the applicable Company or ERISA Affiliate shall promptly make a request for such documents or notices from such administrator or sponsor and shall provide copies of such documents and notices promptly after receipt thereof.

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Maintaining Records; Access to Properties and Inspections.  Keep proper books of record and account (i) in which full, true and correct entries are made in all material respects in conformity with all Requirements of Law, (ii) in form permitting financial statement conforming with GAAP to be derived therefrom and (iii) in which all material dealings and transactions in relation to its business and activities are recorded.  Each Company will permit any representatives designated by the Administrative Agent or any Lender to visit and inspect the financial records and the property of such Company upon reasonable notice at reasonable times and to make extracts from and copies of such financial records, and permit any representatives designated by the Administrative Agent or any Lender to discuss the affairs, finances, accounts and condition of such Company with the officers of such Company and advisors for such Company (including independent accountants); provided, however, that (a) unless an Event of Default has occurred and is continuing, no more than one such visit for the Administrative Agent and the Lenders shall be permitted in each fiscal year (but it is understood that the Lenders or the Administrative Agent may also have a reasonable number of telephone conferences to have such discussions regarding such topics without reference to the foregoing limitation), (b) the Administrative Agent shall cooperate so that such visit does not materially disrupt the normal operations of the Companies, and (c) the Administrative Agent shall conduct each such inspection in compliance with all reasonable safety and security requirements of the Companies.  The Companies shall have no obligation to disclose (i) materials that are protected by attorney-client privilege or the disclosure of which would violate applicable law or any confidentiality obligations of the Companies or (ii) trade secrets.

SECTION 5.07              Use of Proceeds.

Use the proceeds of the Loans only for the purposes set forth in Section 3.12 and request the issuance of Letters of Credit only for legal purposes.

SECTION 5.08              Compliance with Environmental Laws; Environmental Reports.

(a)           Except where the failure to do so could not reasonably be expected to have a Material Adverse Effect, comply, and use commercially reasonable efforts to cause all lessees and other persons occupying Real Property owned, operated or leased by any Company to comply, in all material respects with all Environmental Laws and Environmental Permits applicable to its operations and Real Property; use commercially reasonable efforts to obtain and renew all material Environmental Permits applicable to its operations and Real Property; and conduct all Responses required by, and in accordance with, Environmental Laws; provided that no Company shall be required to undertake any Response to the extent that its obligation to do so is being contested in good faith and by proper proceedings and appropriate reserves are being maintained with respect to such circumstances in accordance with GAAP.

(b)           If a Default caused by reason of a breach of Section 3.18 or Section 5.09(a) shall have occurred and be continuing for more than 90 days without the Companies commencing activities reasonably likely to cure such Default in accordance with Environmental Laws, at the written request of the Administrative Agent or the Required Lenders through the Administrative Agent, provide to the Lenders within 45 days after such request, at the expense of Borrower, an environmental assessment report regarding the matters which are the subject of such Default, including, where appropriate, soil and/or groundwater sampling, prepared by an environmental

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consulting firm and, in the form and substance, reasonably acceptable to the Administrative Agent and indicating the presence or absence of Hazardous Materials and the estimated cost of any compliance or Response to address them.

SECTION 5.09              [Reserved].

SECTION 5.10              Additional Collateral; Additional Guarantors.

(a)           Subject to this Section 5.11, with respect to any property acquired after the Closing Date by any Loan Party that is intended to be subject to the Lien created by any of the Security Documents but is not so subject, promptly (and in any event within 60 days after the acquisition thereof or such longer period as may be approved in writing by the Administrative Agent in its reasonable discretion) (i) execute and deliver to the Administrative Agent and the Collateral Agent such amendments or supplements to the relevant Security Documents or such other documents as the Administrative Agent or the Collateral Agent shall deem reasonably necessary or advisable to grant to the Collateral Agent, for its benefit and for the benefit of the other Secured Parties, a Lien on such property subject to no Liens other than Permitted Collateral Liens, and (ii) take all actions reasonably necessary to cause such Lien to be duly perfected to the extent required by such Security Document in accordance with all applicable Requirements of Law, including the filing of financing statements in such jurisdictions as may be reasonably requested by the Administrative Agent.  Borrower shall otherwise take such actions and execute and/or deliver to the Collateral Agent such documents as the Administrative Agent or the Collateral Agent shall reasonably require to confirm the validity, perfection and priority of the Lien of the Security Documents on such after-acquired properties.

(b)           With respect to any person that is or becomes a Subsidiary of a Loan Party after the Closing Date or any Subsidiary that ceases to be an Excluded Subsidiary or a JV Subsidiary (to the extent such JV Subsidiary would not then otherwise be an Excluded Subsidiary), promptly (and in any event within 45 days after such person becomes a Subsidiary of a Loan Party or so ceases to be an Excluded Subsidiary or a JV Subsidiary (or such longer period as may be approved in writing by the Administrative Agent in its reasonable discretion)) (i) deliver to the Collateral Agent the certificates, if any, representing all of the Equity Interests of such Subsidiary, together with undated stock powers or other appropriate instruments of transfer executed and delivered in blank by a duly authorized officer of the holder(s) of such Equity Interests, and all intercompany notes owing from such Subsidiary to any Loan Party (other than secured intercompany notes owed by any Foreign Subsidiary to any Domestic Subsidiary) together with instruments of transfer executed and delivered in blank by a duly authorized officer of such Loan Party and (ii) cause such new Subsidiary (other than (x) a JV Subsidiary unless required by Section 5.11(c) or (y) an Excluded Subsidiary) (A) to execute a Joinder Agreement or such comparable documentation to become a Subsidiary Guarantor and a joinder agreement to the applicable Security Agreement, substantially in the form annexed thereto and (B) to take all actions reasonably necessary or advisable to cause the Lien created by the applicable Security Agreement to be duly perfected to the extent required by such agreement in accordance with all applicable Requirements of Law, including the filing of financing statements in such jurisdictions as may be reasonably requested by the Administrative Agent or the Collateral Agent.  Notwithstanding the foregoing, the Equity Interests required to be delivered to the Collateral Agent pursuant to clause (i) of this Section 5.11(b) shall not include any Equity Interests of a Foreign Subsidiary; provided

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that this exception shall not apply to (A) Voting Stock of any Subsidiary which is a first-tier CFC representing 65% of the total voting power of all outstanding Voting Stock of such Subsidiary and (B) 100% of the Equity Interests not constituting Voting Stock of any such Subsidiary, except that any such Equity Interests constituting “stock entitled to vote” within the meaning of Treasury Regulation Section 1.956-2(c)(2) shall be treated as Voting Stock for purposes of this Section 5.11(b).

(c)           Notwithstanding the foregoing, but subject to the last sentence of Section 5.11(b) Borrower shall use its commercially reasonable efforts (A) to grant to the Collateral Agent a security interest in the Equity Interest of any newly-formed or after-acquired JV Subsidiary owned directly by any Loan Party and (B) in the case of any JV Subsidiary in which any Loan Party directly or indirectly owns at least 80% of the voting or economic interest, to cause such JV Subsidiary to (i) become a Subsidiary Guarantor, (ii) execute a Joinder Agreement or such comparable documentation to become a Subsidiary Guarantor and a joinder agreement to the applicable Security Agreement, substantially in the form annexed thereto and, in the case of a Foreign Subsidiary, at the request of the Administrative Agent, execute a security agreement compatible with the laws of such Foreign Subsidiary’s jurisdiction in form and substance reasonably satisfactory to the Administrative Agent, and (iii) take all actions reasonably necessary or advisable in the opinion of the Administrative Agent or the Collateral Agent to cause the Lien created by the applicable Security Agreement to be duly perfected to the extent required by such agreement in accordance with all applicable Requirements of Law, including the filing of financing statements in such jurisdictions as may be reasonably requested by the Administrative Agent or the Collateral Agent (in each case, it being understood that such efforts shall not require any material economic or other significant concessions or result in any material adverse tax consequences with respect the terms or structure of such joint venture arrangements).

(d)           Promptly grant to the Collateral Agent, within 90 days of the acquisition thereof (or such longer period as may be approved by the Administrative Agent its reasonable discretion in writing), a security interest in and Mortgage on each Real Property owned in fee by such Loan Party as is acquired by such Loan Party after the Closing Date and that, together with any improvements thereon, has a purchase price of at least $5,000,000, as additional security for the Secured Obligations (unless the subject property is already mortgaged to a third party to the extent permitted by Section 6.02).  Such Mortgages shall be granted pursuant to documentation reasonably satisfactory in form and substance to the Administrative Agent and the Collateral Agent and shall constitute valid and enforceable perfected Liens subject only to Permitted Collateral Liens or other Liens acceptable to the Collateral Agent.  The Mortgages or instruments related thereto shall be duly recorded or filed in such manner and in such places as are required by law to establish, perfect, preserve and protect the Liens in favor of the Collateral Agent required to be granted pursuant to the Mortgages and all taxes, fees and other charges payable in connection therewith shall be paid in full.  Such Loan Party shall otherwise take such reasonable actions and execute and/or deliver to the Collateral Agent such reasonable documents as the Administrative Agent or the Collateral Agent shall reasonably require to confirm the validity, perfection and priority of the Lien of any existing Mortgage or new Mortgage against such after-acquired Real Property (including a Title Policy, a Survey and local counsel opinion (in form and substance reasonably satisfactory to the Administrative Agent and the Collateral Agent) in respect of such Mortgage)

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SECTION 5.11              Security Interests; Further Assurances.

Promptly, upon the reasonable request of the Administrative Agent or the Collateral Agent, at Borrower’s expense, execute, acknowledge and deliver, or cause the execution, acknowledgment and delivery of, and thereafter register, file or record, or cause to be registered, filed or recorded, in an appropriate governmental office, any document or instrument supplemental to or confirmatory of the Security Documents or otherwise deemed by the Administrative Agent or the Collateral Agent reasonably necessary for the continued validity, perfection and priority of the Liens on the Collateral covered thereby subject to no other Liens except Permitted Liens, or obtain any consents or waivers as may be reasonably necessary or appropriate in connection therewith (as may be obtained using commercially reasonable efforts).  Deliver or cause to be delivered to the Administrative Agent and the Collateral Agent from time to time such other documentation, consents, authorizations, approvals and orders in form and substance reasonably satisfactory to the Administrative Agent and the Collateral Agent as the Administrative Agent and the Collateral Agent shall reasonably deem necessary to perfect or maintain the Liens on the Collateral pursuant to the Security Documents.  Upon the exercise by the Administrative Agent, the Collateral Agent or any Lender of any power, right, privilege or remedy pursuant to any Loan Document which requires any consent, approval, registration, qualification or authorization of any Governmental Authority execute and deliver all applications, certifications, instruments and other documents and papers that the Administrative Agent, the Collateral Agent or such Lender may reasonably require.  If the Administrative Agent, the Collateral Agent or the Required Lenders determine that they are required by a Requirement of Law to have appraisals prepared in respect of the Real Property of any Loan Party constituting Collateral, Borrower shall provide to the Administrative Agent appraisals that satisfy the applicable requirements of the Real Estate Appraisal Reform Amendments of FIRREA and are otherwise in form and substance reasonably satisfactory to the Administrative Agent and the Collateral Agent.

SECTION 5.12              Information Regarding Collateral.

(a)           Except as disclosed on Schedule 5.13, no Loan Party will effect any change (i) in any Loan Party’s legal name, (ii) in any Loan Party’s identity or organizational structure, (iii) in any Loan Party’s Federal Taxpayer Identification Number or organizational identification number, if any or (iv) in any Loan Party’s jurisdiction of organization (in each case, including by merging with or into any other entity, reorganizing, dissolving, liquidating, reorganizing or organizing in any other jurisdiction), until (A) it shall have given the Collateral Agent and the Administrative Agent not less than ten days’ prior written notice (in the form of an Officers’ Certificate), or such lesser notice period agreed to by the Collateral Agent, of its intention so to do, clearly describing such change and providing such other information in connection therewith as the Collateral Agent or the Administrative Agent may reasonably request and (B) it shall have taken all action reasonably satisfactory to the Collateral Agent to maintain the perfection and priority of the security interest of the Collateral Agent for the benefit of the Secured Parties in the Collateral, if applicable.  Each Loan Party agrees to promptly provide the Collateral Agent with certified Organizational Documents reflecting any of the changes described in the preceding sentence.

(b)           Concurrently with the delivery of financial statements pursuant to Section 5.01(a),  deliver to the Administrative Agent and the Collateral Agent a Perfection Certificate Supplement

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(provided that in the case that there has been no change in the information provided or required to be provided under the Perfection Certificate since the date of the Perfection Certificate or latest Perfection Certificate Supplement, then delivery of such Perfection Certificate Supplement shall not be required) and a certificate of a Financial Officer of Borrower certifying that the Perfection Certificate Supplement sets forth any changes to in the information provided or required to be provided under the Perfection Certificate since the date of the Perfection Certificate or latest Perfection Certificate Supplement or confirming that there has been no change in such information since the date of the Perfection Certificate or latest Perfection Certificate Supplement.

SECTION 5.13              Maintenance of Ratings.

Use commercially reasonable efforts to obtain Ratings from both S&P and Moody’s and to cause the Loans and Borrower’s corporate credit/family to continue to be rated by S&P and Moody’s (but not to maintain a specific rating).

SECTION 5.14              Compliance with Laws.

(a)           Comply in all material respects with the requirements of all international, foreign, Federal, state and local statutes, treaties, rules, guidelines, regulations, ordinances, codes and administrative or judicial precedents or authorities, including the interpretation or administration thereof by any Governmental Authority charged with the enforcement, interpretation or administration thereof, and all applicable administrative orders, directed duties, requests, licenses, authorizations and permits of, and agreements with, any Governmental Authority (“Laws”) and all orders, writs, injunctions and decrees applicable to it or to its business or property, except in such instances in which (a) such requirement of Law or order, writ, injunction or decree is being contested in good faith by appropriate proceedings diligently conducted or (b) the failure to comply therewith could not reasonably be expected to have a Material Adverse Effect.

(b)           Comply in all material respects with the applicable laws, regulations and executive orders referred to in Section 3.23, including, but not limited, to OFAC, the anti-boycott Laws administered by the U.S. Department of Commerce and the anti-boycott Laws administered by the U.S. Department of the Treasury.

SECTION 5.15              Post-Closing Matters.

Execute and deliver the documents and complete the tasks set forth on Schedule 5.16, in each case within the time limits specified on such schedule or such longer period as may be approved by the Administrative Agent in writing in its reasonable discretion.

ARTICLE VI.

NEGATIVE COVENANTS

Each Loan Party covenants and agrees with each Lender that, so long as this Agreement shall remain in effect and until the Commitments have been terminated and the principal of and interest on each Loan, all Fees and all other expenses or amounts due and payable under any Loan Document have been paid in full (other than contingent indemnification obligations for which no claim has been asserted) and all Letters of Credit have been canceled or have expired

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or been fully cash collateralized and all amounts drawn thereunder have been reimbursed in full, unless the Required Lenders shall otherwise consent in writing, no Loan Party will, nor will they cause or permit any Restricted Subsidiaries to:

SECTION 6.01              Indebtedness.

Incur, create, assume or permit to exist, directly or indirectly, any Indebtedness, except

(a)           Indebtedness incurred under this Agreement and the other Loan Documents;

(b)           (i) Indebtedness outstanding on the Closing Date and listed on Schedule 6.01(b), (ii) the Senior Notes issued on the Closing Date (as in effect on the Closing Date) and related Senior Note Guarantees thereof by the Guarantors; and (iii) refinancings, refundings, renewals, exchanges or extensions of any or all Indebtedness described in clause (i) or (ii); provided that (A) any such refinancing, refunding, renewal, exchange or extension Indebtedness is in an aggregate principal amount not greater than the aggregate principal amount of the Indebtedness being renewed, refinanced, refunded, exchanged or extended plus accrued but unpaid interest thereon, the amount of any premiums required to be paid thereon and reasonable fees and expenses associated therewith, (B) such refinancing, refunding, renewal, exchange or extension Indebtedness has a later or equal final maturity and longer or equal weighted average life to maturity than the Indebtedness being renewed or refinanced and (C) the covenants and events of default shall be, in the aggregate, no less favorable to the Lenders than those contained in the Indebtedness being renewed, refinanced, refunded, exchanged or extended (as determined by the Board of Directors of Borrower in good faith and as evidenced in a resolution of such Board of Directors);

(c)           Indebtedness under Hedging Obligations with respect to interest rates, foreign currency exchange rates or commodity prices, in each case not entered into for speculative purposes;

(d)           Indebtedness permitted by Sections 6.04(f), (l) and (o);

(e)           Indebtedness in respect of Purchase Money Obligations, Capital Lease Obligations and Attributable Indebtedness, and refinancings, refundings, renewals, exchanges or extensions thereof, in an aggregate principal amount for all Companies not to exceed $10,000,000 at any time outstanding;

(f)            Indebtedness incurred by Foreign Restricted Subsidiaries owed to a third party (other than a Loan Party or a Restricted Subsidiary of a Loan Party) in an aggregate principal amount for all Foreign Restricted Subsidiaries not to exceed $10,000,000 at any time outstanding;

(g)           Indebtedness in respect of stay, customs, appeal, statutory, bid, performance or surety bonds, workers’ compensation obligations, self-insurance obligations, bank guarantees and bankers acceptances issued for the account of any Company in the ordinary course of business, including guarantees or obligations of any Company with re-

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spect to letters of credit supporting such stay, customs, appeal, statutory, bid, performance or surety bonds, workers’ compensation obligations, self-insurance obligations, bank guarantees and bankers acceptances (in each case other than for an obligation for money borrowed);

(h)           Contingent Obligations of (i) any Loan Party in respect of Indebtedness of another Loan Party otherwise permitted under this Section 6.01 (other than Section 6.01(l)), (ii) any Loan Party in respect of Indebtedness of any Company that is not a Loan Party, provided that the Investment resulting from the incurrence thereof (equal to the principal amount of the guaranteed Indebtedness) is permissible under Section 6.04(l) and (o) or (iii) any Company that is not a Loan Party in respect of Indebtedness of any other Company that is not a Loan Party;

(i)            Indebtedness arising from the honoring by a bank or other financial institution of a check, draft or similar instrument inadvertently (except in the case of daylight overdrafts) drawn against insufficient funds in the ordinary course of business; provided, however, that such Indebtedness is extinguished within ten Business Days of incurrence;

(j)            Indebtedness arising in connection with endorsement of instruments for deposit in the ordinary course of business;

(k)           Indebtedness of a person acquired in a Permitted Acquisition or assumed in connection with a Permitted Acquisition; provided that such Indebtedness exists at the time such Permitted Acquisition is consummated and is not created in anticipation of such Permitted Acquisition;

(l)            Permitted Subordinated Indebtedness of Holdings so long as the proceeds thereof are promptly contributed to Borrower as common equity and any refinancing, refunding, renewals, exchanges or extension of such Permitted Subordinated Indebtedness (so long as Holdings is the only obligor on such refinancing, refunding, renewal, exchange or extension Indebtedness); provided that (A) the aggregate principal amount outstanding at any time of any such Indebtedness permitted under this Section 6.01(l), the proceeds of which are not contributed to Borrower to finance an Investment pursuant to Section 6.04(f)(i), (h), (k), (o), (t) or, to the extent not made in another Company, (s), shall not exceed $10,000,000; (B) any such refinancing, refunding, renewal, exchange or extension Indebtedness permitted under this Section 6.01(l) shall have a later or equal final maturity and longer or equal weighted average life to maturity than the Indebtedness being refinanced, refunded, renewed, exchanged or extended, (C) the covenants, events of default, subordination provisions of such refinancing, refunding, renewal, exchange or extension Indebtedness shall be, in the aggregate, no less favorable to the Lenders than those contained in the Permitted Subordinated Indebtedness being renewed or refinanced (as determined by the Board of Directors of Borrower in good faith as evidenced in a resolution of such Board of Directors);

(m)          unsecured Indebtedness of Borrower (and any related unsecured guarantee by any Guarantor) that (i) will not mature prior to the 180th day following the Term B Loan Maturity Date, (ii) has no (A) scheduled amortization of principal or (B) required or

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mandatory redemptions, or repurchases, sinking fund obligation or payments of principal prior to the 180th day following the Term B Loan Maturity Date (other than, in the case of this clause (B), those that are no less favorable, taken as a whole, than those that are customary for high yield notes), (iii) contains covenants and events of default that are no less favorable to Holdings and its Restricted Subsidiaries than the terms of this Agreement as of the Closing Date (with respect to clauses (ii)(B) and (iii), as determined by the Board of Directors of Borrower in good faith as evidenced in a resolution of such Board of Directors); provided that (x) no Default or Event of Default shall have occurred and be continuing at the time of incurrence of such unsecured Indebtedness or would result therefrom and (y) Borrower is in compliance with Section 6.09 on a Pro Forma Basis after giving effect to such unsecured Indebtedness as of the end of the most recent Test Period;

(n)           Indebtedness of any Loan Party arising from agreements providing for earnouts, escrows, holdbacks and other, similar unsecured deferred payment obligations, indemnification, adjustment of purchase price or other similar obligations, in each case, that are contingent obligations (provided that, to the extent such obligations become due and payable, and are not subject to a good faith dispute, they shall be paid within 30 days of the date on which they are due);

(o)           Non-Recourse Debt of a JV Subsidiary in an aggregate principal amount for all JV Subsidiaries not to exceed $2,500,000 at any time outstanding;

(p)           Indebtedness incurred by Borrower or any of its Restricted Subsidiaries to finance the payment of insurance premiums of Borrower or its Restricted Subsidiaries in the ordinary course of business;

(q)           Contingent Obligations in respect of Indebtedness of directors, officers and employees of Holdings or any of its Restricted Subsidiaries in respect of expenses of such persons in connection with relocations and other bona fide business purposes, in an aggregate amount for all such Indebtedness incurred under this Section 6.01(q) not to exceed $1,000,000 at any one time outstanding;

(r)            Indebtedness of Holdings (that is not guaranteed or given any other credit support by any other Company) evidenced by promissory notes issued to former or current management, directors, officers, consultants or employees (or their transferees, estates or beneficiaries under their estates) of Holdings or any of its Restricted Subsidiaries in lieu of any cash payment permitted to be made under Section 6.07(b); provided that all such Indebtedness shall be unsecured and expressly subordinated to the prior payment in full in cash of all Obligations on terms that are reasonably satisfactory to the Administrative Agent; and

(s)           Indebtedness of one or more Companies in an aggregate principal amount not to exceed $20,000,000 for all Companies at any time outstanding.

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SECTION 6.02              Liens.

Create, incur, assume or permit to exist, directly or indirectly, any Lien on any property now owned or hereafter acquired by it or on any rights in respect of any thereof, except the following (collectively, the “Permitted Liens”):

(a)           inchoate Liens for Taxes not yet due and payable or delinquent and Liens for Taxes which are being contested in good faith by appropriate proceedings for which adequate reserves have been established in accordance with GAAP, which proceedings (or orders entered in connection with such proceedings) have the effect of preventing the forfeiture or sale of the property subject to any such Lien;

(b)           Liens in respect of property of any Company imposed by Requirements of Law, which were incurred in the ordinary course of business and do not secure Indebtedness for borrowed money, such as liens arising under Environmental Laws, carriers’, warehousemen’s, materialmen’s, landlords’, workmen’s, suppliers’, repairmen’s and mechanics’ Liens and other similar Liens arising in the ordinary course of business, and (i) which do not in the aggregate materially impair the use thereof in the operation of the business of the Companies, taken as a whole, and (ii) which, if they secure obligations that are then due and unpaid for more than 45 days are being contested in good faith by appropriate proceedings for which adequate reserves have been established in accordance with GAAP, which proceedings (or orders entered in connection with such proceedings) have the effect of preventing the forfeiture or sale of the property subject to any such Lien;

(c)           any Lien in existence on the Closing Date and set forth on Schedule 6.02(c), any modification, renewal or extension thereof and any Lien granted as a replacement or substitute therefor; provided that any such modification, renewal, extension or replacement or substitute Lien (i) except as permitted by Section 6.01(b)(iii)(A), does not secure any Indebtedness other than the Indebtedness secured on the Closing Date (plus the amount of accrued and unpaid interest, any premiums required to be paid with respect thereto and reasonable fees and expenses associated therewith) and (ii) does not encumber any property other than the property subject thereto on the Closing Date other than improvements thereon or proceeds from the disposition of such property (any such Lien, an “Existing Lien”);

(d)           easements, rights-of-way, restrictions (including zoning restrictions), covenants, licenses, encroachments, protrusions and other similar charges or encumbrances, and other title deficiencies on or with respect to any Real Property, in each case whether now or hereafter in existence, not (i) securing Indebtedness, or (ii) individually or in the aggregate materially interfering with the ordinary conduct of the business of the Companies (taken as a whole);

(e)           Liens arising out of judgments, attachments or awards not resulting in an Event of Default;

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(f)            Liens (other than any Lien imposed by ERISA) (w) imposed by Requirements of Law or deposits made in connection therewith in the ordinary course of business in connection with workers’ compensation, unemployment insurance and other types of social security legislation, (x) incurred in the ordinary course of business to secure the performance of tenders, statutory obligations (other than excise taxes), surety, stay, customs and appeal bonds, statutory bonds, bids, leases, government contracts, trade contracts, performance and return of money bonds and other similar obligations (exclusive of obligations for the payment of borrowed money) or (y) arising by virtue of deposits made in the ordinary course of business to secure liability for premiums to insurance carriers or (z) on cash collateral to secure reimbursement obligations under letters of credit provided to support any of the obligations described in the preceding clauses;

(g)           leases, subleases, licenses or sublicenses of the properties of any Company granted by such Company to third parties, in each case so long as such Leases and subleases do not, individually or in the aggregate, interfere in any material respect with the ordinary conduct of the business of the Companies;

(h)           Liens arising out of conditional sale, title retention, consignment or similar arrangements for the sale of goods entered into by any Company in the ordinary course of business;

(i)            Liens securing Indebtedness incurred pursuant to Section 6.01(e); provided that any such Liens attach only to the property being financed pursuant to such Indebtedness and do not encumber any other property of any Company (other than improvements thereon and accessions thereto); it being understood that individual financings of equipment of any Company pursuant to Section 6.01(e) may be cross-collateralized to other financings of equipment of other Companies pursuant to Section 6.01(e) by such lender;

(j)            bankers’ Liens, rights of setoff and other similar Liens existing solely with respect to cash and Cash Equivalents on deposit in one or more accounts maintained by any Company, in each case granted in the ordinary course of business or arising by operation of law in favor of the bank or banks with which such accounts are maintained, securing amounts owing to such bank with respect to cash management and operating account arrangements, including those involving pooled accounts and netting arrangements; provided that, unless such Liens are non-consensual and arise by operation of law, in no case shall any such Liens secure (either directly or indirectly) the repayment of any Indebtedness;

(k)           Liens on property of a person existing at the time such person is acquired or merged with or into or consolidated with any Company to the extent such acquisition, merger or consolidation is permitted hereunder (and not created in anticipation or contemplation thereof); provided that such Liens do not extend to property not subject to such Liens at the time of acquisition (other than improvements thereon and accessions thereto);

(l)            Liens granted pursuant to the Security Documents;

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(m)          licenses of Intellectual Property granted by any Company and not interfering in any material respect with the ordinary conduct of business of the Companies;

(n)           the filing of UCC financing statements solely as a precautionary measure in connection with operating leases or consignment of goods;

(o)           Liens securing Indebtedness incurred pursuant to Section 6.01(f) or 6.01(s); provided that (i) such Liens do not extend to, or encumber, property which constitutes Collateral and (ii) such Liens extend only to the property of the Foreign Subsidiaries; and

(p)           Liens attached to cash earnest money deposits made by a Company in connection with any letter of intent or purchase agreement entered into by a Loan Party;

(q)           Liens incurred in the ordinary course of business of any Company with respect to obligations that do not in the aggregate for all Companies exceed $10,000,000 at any time outstanding;

(r)            Liens on the assets of any JV Subsidiary securing Non-Recourse Debt of a JV Subsidiary permitted under Section 6.01(o) so long as the Secured Parties have a Lien on the assets of any JV Guarantor subject to such Liens permitted under this Section 6.02(r) and such Liens on assets of any JV Guarantor permitted under this Section 6.02(r) are junior to the Liens granted pursuant to the Security Documents;

(s)           the existence of the “equal and ratable clause in the Senior Note Documents (not any security interests granted pursuant thereto);

(t)            Liens in favor of any Loan Party (other than Holdings) to secure intercompany Indebtedness; provided that, if such Liens are on Collateral, such Liens are subordinated to the Liens securing the Obligations on terms reasonably satisfactory to the Administrative Agent;

(u)           Liens deemed to exist in connection with Investments in repurchase agreements for Cash Equivalents permitted under Section 6.06;

(v)           Liens on insurance policies and the proceeds thereof securing the financing of the premiums with respect thereto to the extent permitted under Section 6.01(p);

(w)          Liens in favor of customs and revenue authorities arising as a matter of law to secure payment of customs duties in connection with the importation of goods; and

(x)            Liens upon specific items of inventory or other goods and proceeds of any person securing such person’s obligations in respect of bankers’ acceptances issued or created for the account of such Person to facilitate the purchase, shipment or storage of such inventory or other goods in the ordinary course of business;

provided, however, that no consensual Liens shall be permitted to exist, directly or indirectly, on any Securities Collateral, other than Liens granted pursuant to the Security Documents.

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SECTION 6.03              Sale and Leaseback Transactions.

Enter into any arrangement, directly or indirectly, with any person whereby it shall sell or transfer any property, real or personal, used or useful in its business, whether now owned or hereafter acquired, and substantially contemporaneously therewith rent or lease such property or other property which it intends to use for substantially the same purpose or purposes as the property being sold or transferred (a “Sale and Leaseback Transaction”) unless (i) the sale of such property is permitted by Section 6.06 and (ii) any Attributable Indebtedness and any Liens arising in connection with such transaction or its use of such property are permitted by Sections 6.01 and 6.02 respectively.

SECTION 6.04              Investment, Loan, Advances and Acquisition.

Directly or indirectly, lend money or credit (by way of guarantee or otherwise) or make advances to any other person, or purchase or acquire any Equity Interests, bonds, notes, debentures, guarantees or other obligations or securities of, or any other interest in, or make any capital contribution to, any other person, or purchase or acquire (in one transaction or a series of transactions) all or substantially all of the assets of any other person or any business or division of any other person (all of the foregoing, collectively, “Investments”), except that the following shall be permitted:

(a)           the Companies may consummate the Transactions in accordance with the provisions of the Transaction Documents;

(b)           any Investment outstanding on the Closing Date and identified on Schedule 6.04(b) and any modification, replacement, renewal or extension thereof which does not involve an additional Investment;

(c)           the Companies may (i) acquire and hold accounts receivable owing to any of them if created or acquired in the ordinary course of business and payable or dischargeable in accordance with customary terms, (ii) invest in, acquire and hold cash and Cash Equivalents, (iii) endorse negotiable instruments held for collection in the ordinary course of business or (iv) make lease, utility and other similar deposits in the ordinary course of business including any such deposits permitted under Section 6.02;

(d)           Hedging Obligations permitted to be incurred under Section 6.01(c);

(e)           loans and advances to directors, employees and officers of Holdings and the Restricted Subsidiaries (x) for bona fide business purposes (including travel, entertainment and relocation expenses relating to such Person’s activities with respect to Borrower and the Restricted Subsidiaries) in an aggregate amount for all such loans and advances made by any of the Companies pursuant to this Section 6.04(e)(x) not to exceed $1,500,000 at any time outstanding and (y) to purchase Equity Interests of Holdings (other than Disqualified Capital Stock), so long as, in the case of this Section 6.04(e)(y), a cash amount equal to such loans or advances is immediately reinvested in Borrower;

(f)            Investments (i) by any Company in Borrower or any Subsidiary Guarantor and (ii) by a Restricted Subsidiary that is not a Subsidiary Guarantor in any other Re-

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stricted Subsidiary that is not a Subsidiary Guarantor; provided that (A) any Investment by or in a Loan Party in the form of a loan or advance shall be evidenced by a promissory note which shall be pledged by such Loan Party as Collateral pursuant to the Security Documents and (B) any Investment in the form of a loan or advance in a Company that is not a Loan Party shall be subject to the Intercompany Subordination Agreement;

(g)           Investments in securities of trade creditors or customers received upon foreclosure or pursuant to any plan of reorganization or liquidation or similar arrangement upon the bankruptcy or insolvency of such trade creditors or customers;

(h)           Permitted Acquisitions;

(i)            mergers and consolidations in compliance with Section 6.05;

(j)            Investments made by Borrower or any Restricted Subsidiary as a result of consideration received in connection with an Asset Sale made in compliance with Section 6.06;

(k)           Investments by any Company in a JV Subsidiary in an aggregate amount for all Companies not exceeding $10,000,000 at any time outstanding;

(l)            Investments made by any Loan Party in a Restricted Subsidiary that is not a Loan Party (i) set forth in Schedule 6.04(l) and (ii) in an aggregate amount at any time outstanding (excluding the Investments set forth in Schedule 6.04(l)) for all Loan Parties not to exceed the sum of (A) $10,000,000, or the foreign currency equivalent thereof, plus (B) any offsetting cash returns actually received after the Closing Date by the relevant Loan Party in respect of any Investment set forth on Schedule 6.04(l), plus (C) the Available Basket Amount;

(m)          Guarantees of Indebtedness permitted under Section 6.01(h)(i);

(n)           Loans and advances by Borrower to Holdings to permit Holdings, to repurchase or redeem Qualified Capital Stock of Holdings held by officers, directors or employees or former officers, directors or employees (or their transferees, estates or beneficiaries under their estates) of any Company, upon their death, disability, retirement, severance or termination of employment or service, in an amount not to exceed in any fiscal year, when aggregated with all Dividends in such fiscal year permitted under Section 6.07(b), the amount permitted by Section 6.07(b) provided that any such loans or advances shall be evidenced by a promissory note and shall be subject to the Intercompany Subordination Agreement and pledged by Borrower as Collateral pursuant to the Security Documents;

(o)           Investments in Restricted Subsidiaries organized under the laws of Canada or any province thereof made in the form of an intercompany loan from a Loan Party used solely to effect Permitted Acquisitions, in amount not to exceed $50,000,000 at any time outstanding; provided that such intercompany loan is evidenced by an intercompany note pledged to the Collateral Agent as security for the Obligations;

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(p)           any Investment held by any person in existence at the time such person becomes a Restricted Subsidiary; provided that such Investment was not made in connection with or anticipation of such person becoming a Restricted Subsidiary and any modification, replacement, renewal or extension of such Investment which does not involve an additional Investment;

(q)           the establishment, creation or acquisition of Subsidiaries to the extent permitted by Section 6.13 (provided that the making of any Investment in such Subsidiaries shall require the usage of another exception under this Section 6.04);

(r)            Investments in an amount not to exceed the Available Basket Amount at the time of such Investment;

(s)           other Investments (other than in a JV Subsidiary) in an aggregate amount for all Companies not to exceed $15,000,000 at any time outstanding; and

(t)            Investments in Restricted Subsidiaries to the extent made to effectuate a substantially contemporaneous Permitted Acquisition otherwise permitted hereunder.

SECTION 6.05              Mergers and Consolidations.

Wind up, liquidate or dissolve its affairs or enter into any transaction of merger or consolidation, except that the following shall be permitted:

(a)           the Transactions as contemplated by the Transaction Documents;

(b)           acquisitions in compliance with Section 6.04;

(c)           any Company may merge or consolidate with or into Borrower or any Subsidiary Guarantor (as long as Borrower is the surviving person in the case of any merger or consolidation involving Borrower and a Subsidiary Guarantor is the surviving person and remains a Wholly Owned Subsidiary of Holdings in any other case); provided that the Lien on and security interest in such property granted or to be granted in favor of the Collateral Agent under the Security Documents shall be maintained or created in accordance with the provisions of Section 5.11 or Section 5.12, as applicable;

(d)           any Restricted Subsidiary that is not a Loan Party may merge or consolidate with or into any other Restricted Subsidiary that is not a Loan Party;

(e)           any Restricted Subsidiary (other than Borrower) may dissolve, liquidate or wind up its affairs at any time; provided that such dissolution, liquidation or winding up, as applicable, could not reasonably be expected to have a Material Adverse Effect;

(f)            the transactions set forth on Schedule 6.05(f).

To the extent the Required Lenders or all the Lenders, as applicable, waive the provisions of this Section 6.05 with respect to the sale of any Collateral, or any Collateral is sold as permitted by this Section 6.05, such Collateral (unless sold to a Company) shall be sold free and clear

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of the Liens created by the Security Documents, automatically and without further action by any Person, and, so long as Borrower shall have provided the Agents such certifications or documents as any Agent shall reasonably request in order to demonstrate compliance with this Section 6.05, the Agents shall take all actions they deem necessary in order to effect the foregoing.

SECTION 6.06              Asset Sales.

Effect any Asset Sale, except that the following shall be permitted:

(a)           dispositions of used, worn out, obsolete or surplus property by any Company in the ordinary course of business and the assignment, cancellation, abandonment or other disposition of Intellectual Property that is, in the reasonable judgment of Borrower, no longer economically practicable to maintain or useful in the conduct of the business of the Companies taken as a whole;

(b)           Asset Sales at fair market value; provided that (i) at the time of such Asset Sale, no Default shall exist or would result from such Asset Sale, (ii) the aggregate fair market value of assets disposed in respect of all Asset Sales of all Companies pursuant to this clause (b) during the term of this Agreement shall not exceed $50,000,000 and (iii) at least 75% of the purchase price for all property subject to such Asset Sale shall be paid to Holdings or such Restricted Subsidiary in cash and Cash Equivalents;

(c)           Leases and subleases of property of any Company permitted by Section 6.02(g);

(d)           mergers and consolidations in compliance with Section 6.05;

(e)           licenses of Intellectual Property permitted by Section 6.02(m);

(f)            dispositions, by means of trade in, of equipment;

(g)           the sale or disposition, within 365 days after the date of a Permitted Acquisition, of (i) any portion of a business or operations acquired in a Permitted Acquisition, that is, in the judgment of Borrower, no longer economically practicable to maintain or useful in the conduct of the business of the Companies taken as a whole or (ii) solely to the extent required by any Governmental Authority pursuant to applicable anti-trust law or other similar Requirement of Law in connection with any Permitted Acquisition, any other portion of a business or operations of the Companies, in each case, provided that (x) the consideration received for such assets shall be in an amount at least equal to the fair market value thereof (determined in good faith by the Board of Directors of Borrower) and (y) no Default or any Event of Default has occurred and is continuing or would result from such disposition and (z) at least 75% of the purchase price for all property subject to such Asset Sale shall be paid to Holdings or any Restricted Subsidiary solely in cash and Cash Equivalents;

(h)           sales and dispositions of property resulting in no more than $500,000 in Net Cash Proceeds for any individual transaction and no more than $2,000,000 in Net Cash Proceeds of all Asset Sales of all Companies in the aggregate in any fiscal year;

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(i)            any disposition of any JV Subsidiaries’ Equity Interests in accordance with the applicable joint venture agreement related thereto;

(j)            Investments to the extent permitted by Section 6.04;

(k)           the issuance of Equity Interests to the extent permitted by Section 6.12; and

(l)            sales, forgiveness or other dispositions of accounts receivable in the ordinary course of business in connection with the collection or compromise thereof.

To the extent the Required Lenders or all the Lenders, as applicable, waive the provisions of this Section 6.06 with respect to the sale of any Collateral, or any Collateral is sold as permitted by this Section 6.06, such Collateral (unless sold to a Company) shall be sold free and clear of the Liens created by the Security Documents, automatically and without any further action by any Person, and, so long as Borrower shall have provided the Agents such certifications or documents as any Agent shall reasonably request in order to demonstrate compliance with this Section 6.06, the Agents shall take all actions necessary in order to effect the foregoing.  For purposes of Section 6.06(b)(iii) and 6.06(g)(z), the following shall be deemed to be cash: (a) the assumption of any liabilities of Holdings or any Restricted Subsidiary with respect to, and the release of Holdings or such Restricted Subsidiary from all liability in respect of, any Indebtedness of Holdings or the Restricted Subsidiaries permitted hereunder (in the amount of such Indebtedness) that is due and payable within one year of the consummation of such Asset Sale and (b) securities received by Holdings or any Restricted Subsidiary from the transferee that are converted into cash within 365 days after receipt.

SECTION 6.07              Dividends.

Effectuate, directly or indirectly, any Dividends with respect to any Company, except that the following shall be permitted:

(a)           Dividends by any Restricted Subsidiary of Borrower pro rata to the holders of its Equity Interests;

(b)           so long as no Default or Event of Default shall have occurred and be continuing or would result therefrom, payments to Holdings to permit Holdings or any parent entity of Holdings, and the subsequent use of such payments by Holdings or such parent entity, to repurchase or redeem Qualified Capital Stock of Holdings or such parent entity held by officers, directors or employees or former officers, directors or employees (or their transferees, estates or beneficiaries under their estates) of any Company; provided that the aggregate cash consideration paid for all such redemptions and payments together with the aggregate amount of all Investments made pursuant to Section 6.04(n) shall not exceed in the aggregate, $1,000,000 in any fiscal year; provided, further, that any Company may carry over and make in subsequent fiscal years, in addition to the amounts permitted for such fiscal year, the amount of such purchases, redemptions or other acquisitions or retirements for value permitted to have been made but not made in any preceding fiscal year, provided that the total amount of redemption and payments, including any such carry-overs, shall not exceed a maximum of $1,500,000 in any fiscal year; provided,

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further, that such maximum amount in any fiscal year may be increased by an amount not to exceed (i) the Available Basket Amount plus (ii) the net cash proceeds of key man life insurance policies received by Borrower after the Closing Date less any amounts previously applied to the payment of Dividends pursuant to this clause (b);

(c)           (A) to the extent actually used by Holdings (or any direct or indirect parent of Holdings) to pay such taxes, costs and expenses, payments by Borrower to or on behalf of Holdings (and by Holdings to or on behalf of such direct or indirect parent of Holdings) in an amount sufficient to pay franchise taxes and other fees required to maintain the legal existence of Holdings or that are otherwise attributable to the ownership or operation of Borrower and (B) payments by Borrower to or on behalf of Holdings in an amount sufficient to pay out-of-pocket legal, accounting and filing costs and other expenses in the nature of overhead in the ordinary course of business of Holdings (including premiums for directors and officers insurance), in the case of clauses (A) and (B), in an aggregate amount not to exceed $1,000,000 in any fiscal year of Borrower;

(d)           any additional Dividend in an amount not to exceed the Available Basket Amount; provided that (i) no Default or Event of Default has occurred and is continuing at the time of any such Dividend or would result therefrom, (ii) after giving effect to such Dividend, Holdings and its Restricted Subsidiaries are in compliance with Section 6.09 as calculated on a Pro Forma Basis as of the end of the most recent Test Period and (iii) the aggregate amount of all Dividends paid pursuant to this clause (d) does not exceed $10,000,000 during the term of this Agreement;

(e)           any JV Subsidiary may pay Dividends required or permitted to be made pursuant to the terms of the joint venture arrangements to holders of its Equity Interests;

(f)            Dividends to Holdings of Qualified Capital Stock of Holdings to the extent such Qualified Capital Stock of Holdings is acquired by Borrower as a result of a foreclosure action following a default on an advance, loan and/or other extension of credit permitted pursuant to Section 6.04(n);

(g)           payments resulting from the cashless exercise of options and warrants on the Equity Interests of any Company permitted hereunder;

(h)           cash payments in lieu of the issuance of fractional shares in connection with the exercise of warrants, options or other securities convertible into or exchangeable for Equity Interests in Holdings, in an aggregate amount for all such payments pursuant to this Section 6.07(h) not to exceed $1,000,000;

(i)            to the extent such proceeds or contribution do not (A) increase the Available Basket Amount, (B) constitute a Specified Equity Contribution or (C) comprise the Equity Financing, the making of any payment in exchange for or out of the net cash proceeds of, a contribution to the common equity of Holdings or a substantially concurrent sale of Qualified Capital Stock of Holdings; and

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(j)            Permitted Tax Distributions by Borrower to Holdings, and by Holdings to a direct or indirect parent so long as Holdings or such parent uses such distributions to pay its U.S. federal, state or local income taxes.

SECTION 6.08              Transactions with Affiliates.

Enter into, directly or indirectly, any transaction or series of related transactions, whether or not in the ordinary course of business, with any Affiliate of any Company (other than between or among the Companies), other than any transaction or series of related transactions on terms and conditions substantially as favorable to such Company as would reasonably be obtained by such Company at that time in a comparable arm’s-length transaction with a person other than an Affiliate, except that the following shall be permitted:

(a)           Dividends permitted by Section 6.07;

(b)           Indebtedness pursuant to Section 6.01(d), (h), (o), (q) or (r) and Investments pursuant to Section 6.04(a), (f), (k), (l), (m), (n), (o) or (p);

(c)           reasonable director, officer and employee compensation (including bonuses) and other benefits (including retirement, health, stock option and other benefit plans) and commercially reasonable arrangements, in each case approved by the Board of Directors of Holdings;

(d)           transactions with customers, clients, suppliers, joint venture partners or purchasers or sellers of goods and services, in each case in the ordinary course of business and otherwise not prohibited by the Loan Documents;

(e)           payments to (i) so long as no Event of Default under Section 8.01(a), (b), (g) or (h) then exists or would result therefrom, any Sponsor and its respective affiliates of fees in the amounts and at the times specified in, and in accordance with the other terms of, the Advisory Agreement, as such agreement is in effect with respect to such fees and amounts on the Closing Date, (including the “Acquisition Fee”, the “Advisory Fees”, and the “Transaction Fees”, as defined in the Advisory Agreement), and (ii) the Sponsors in respect of reasonable out-of-pocket expenses (including indemnification obligations) incurred in connection with providing or obtaining management, consulting, monitoring, financial advisory, accounting or other services to or for the benefit of the Companies, as set forth in the Advisory Agreement;

(f)            sales and other issuances of Qualified Capital Stock of Holdings to Affiliates of Borrower not otherwise prohibited by the Loan Documents and the granting of registration and other customary rights in connection therewith;

(g)           any transaction with an Affiliate where the only consideration paid by any Loan Party is Qualified Capital Stock of Holdings;

(h)           entry into a tax sharing agreement with any direct or indirect parent of Borrower providing for (in each case subject to compliance with Section 6.07) the payments

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of Taxes (including interest and penalties) and expenses, control of tax filings and contests, and other normal, usual and customary provisions; and

(i)            the Transactions as contemplated by the Transaction Documents.

SECTION 6.09              Financial Covenants.

(a)           Maximum Total Leverage Ratio.  Beginning with the fiscal quarter of Holdings ending on or about March 31, 2011, permit the Total Leverage Ratio, as of the last day of any Test Period ending during any period (inclusive of the beginning and ending dates of each such period) in the table below, to exceed the ratio set forth opposite such period in the table below:

Period	Total Leverage Ratio
Closing Date to end of fiscal quarter ending on or about December 31, 2011	7.00 to 1.0
Thereafter to end of fiscal quarter ending on or about June 30, 2012	6.75 to 1.0
Thereafter to end of fiscal quarter ending on or about December 31, 2012	6.50 to 1.0
Thereafter to end of fiscal quarter ending on or about June 30, 2013	6.25 to 1.0
Thereafter to end of fiscal quarter ending on or about September 30, 2013	6.00 to 1.0
Thereafter to end of fiscal quarter ending on or about September 30, 2014	5.25 to 1.0
Thereafter to end of fiscal quarter ending on or about September 30, 2015	4.50 to 1.0
Thereafter	4.00 to 1.0

(b)           Minimum Cash Interest Coverage Ratio.  Beginning with the fiscal quarter of Holdings ending on or about March 31, 2011, permit the Cash Interest Coverage Ratio, for any Test Period ending during any period (inclusive of the beginning and ending dates of each such period) in the table below, to be less than the ratio set forth opposite such period in the table below:

Period	Cash Interest Coverage Ratio
Closing Date to end of fiscal quarter ending on or about March 31, 2012	1.65 to 1.0
Thereafter to end of fiscal quarter ending on or about September 30, 2012	1.75 to 1.0
Thereafter to end of fiscal quarter ending on or about September 30, 2013	1.85 to 1.0
Thereafter to end of fiscal quarter ending on or about September 30, 2014	2.00 to 1.0
Thereafter to end of fiscal quarter ending on or about September 30, 2015	2.25 to 1.0
Thereafter	2.50 to 1.0

(c)           Limitation on Capital Expenditures.  Permit the aggregate amount of Capital Expenditures made in any period (inclusive of the beginning and ending dates of each such period) set forth below to exceed the amount set forth opposite such period below:

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Period	Amount
October 2, 2010 to end of fiscal year ending on or about September 30, 2011	$	8,000,000
Thereafter to end of fiscal year ending on or about September 30, 2012	$	8,500,000
Thereafter to end of fiscal year ending on or about September 30, 2013	$	9,000,000
Thereafter to end of fiscal year ending on or about September 30, 2014	$	9,500,000
Thereafter to end of fiscal year ending on or about September 30, 2015	$	10,000,000
Thereafter to end of fiscal year ending on or about September 30, 2016	$	10,000,000
Thereafter	$	10,000,000

; provided, however, that (x) if the aggregate amount of Capital Expenditures made in any period set forth in the table above shall be less than the maximum amount of Capital Expenditures permitted under this Section 6.09(c) for such period (before giving effect to any carryover), then the amount of such shortfall (without giving effect to clause (z) below) may be added to the amount of Capital Expenditures permitted under this Section 6.09(c) for the immediately succeeding (but not any other) period set forth in the table above, (y) in determining whether any amount is available for carryover, the amount expended in any period set forth in the table above shall first be deemed to be from the amount allocated to such period (before giving effect to any carryover) and (z) the amount set forth in the table above for any period may be increased by 2.5% of the net sales generated by the person or business acquired in any Permitted Acquisition after the Closing Date during the latest four full fiscal quarters prior to such Permitted Acquisition for which financial statements for such person or business are available (rounded to the nearest $100,000).

SECTION 6.10Prepayments of Other Indebtedness; Modifications of Organizational Documents and Other Documents, etc.

Directly or indirectly:

(a)           make any payment or prepayment of principal of, or redemption or acquisition for value of any principal of, or any prepayment of principal or redemption of principal as a result of any asset sale, change of control or similar event of, any Indebtedness outstanding under the Senior Note Documents (or any refinancing, refunding, renewal, exchange or extension of the Senior Notes) or any Subordinated Indebtedness, except (i) in connection with (A) a refinancing, refunding, renewal, exchange or extension of the Senior Notes permitted by Section 6.01(b)(iii), (B) a refinancing, refunding, renewal, exchange or extension of the Permitted Subordinated Indebtedness of Holdings permitted by Section 6.01(l) or (C) a refinancing, refunding, renewal, exchange or extension of Indebtedness incurred pursuant to Section 6.01(m) with other Indebtedness incurred pursuant to Section 6.01(m) (provided that this clause (C) shall not permit a refinancing, refunding, renewal, exchange or extension of Subordinated Indebtedness with Indebtedness that is not Subordinated Indebtedness), (ii) prepayments, redemptions or acquisitions of such Indebtedness not in excess of the Available Basket Amount, (iii) the conversion or exchange of such Indebtedness into Qualified Capital Stock of Holdings (iv) payments expressly permitted by any subordination agreement relating to such Subordinated Indebtedness including in the case of intercompany loans permitted as Investments under Section 6.04(l),

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the Intercompany Subordination Agreement and (v) payments of regularly scheduled principal on the maturity date thereof;

(b)           amend or modify, or permit the amendment or modification of, any provision of any Transaction Document in any manner that is adverse in any material respect to the interests of the Lenders; or

(c)           terminate, amend or modify any of its Organizational Documents (including (x) by the filing or modification of any certificate of designation and (y) any election to treat any Pledged Securities (as defined in the Security Agreement) as a “security” under Section 8-103 of the UCC other than substantially concurrently with the delivery of certificates representing such Pledged Securities to the Collateral Agent) or any agreement to which it is a party with respect to its Equity Interests (including any stockholders’ agreement), or enter into any new agreement with respect to its Equity Interests, other than (i) such terminations, amendments and modifications set forth on Schedule 6.10(c) or (ii) any such amendments or modifications or such new agreements which are not adverse in any material respect to the interests of the Lenders; provided that Holdings may issue such Equity Interests, so long as such issuance is not prohibited by Section 6.12 or any other provision of this Agreement, and may amend or modify its Organizational Documents to authorize any such Equity Interests.

SECTION 6.11              Limitation on Certain Restrictions on Restricted Subsidiaries.

Directly or indirectly, create or otherwise cause or suffer to exist or become effective any encumbrance or restriction on the ability of any Restricted Subsidiary to (a) pay dividends or make any other distributions on its capital stock or any other interest or participation in its profits owned by Borrower or any Restricted Subsidiary, or pay any Indebtedness owed to Holdings or a Restricted Subsidiary, (b) make loans or advances to Holdings or any Restricted Subsidiary or (c) transfer any of its properties to Holdings or any Restricted Subsidiary, except for such encumbrances or restrictions existing under or by reason of (i) applicable Requirements of Law; (ii) this Agreement and the other Loan Documents; (iii) the Senior Note Documents; (iv) customary provisions restricting subletting or assignment of any lease governing a leasehold interest of a Restricted Subsidiary; (v) customary provisions restricting assignment of any agreement entered into by a Restricted Subsidiary in the ordinary course of business; (vi) any holder of a Lien permitted by Section 6.02 restricting the transfer of the property subject thereto; (vii) customary restrictions and conditions contained in any agreement relating to the sale of any property permitted under Section 6.06 pending the consummation of such sale; (viii) any agreement in effect at the time such Restricted Subsidiary becomes a Restricted Subsidiary of Borrower, so long as such agreement was not entered into in connection with or in contemplation of such person becoming a Restricted Subsidiary of Borrower; (ix) without affecting the Loan Parties’ obligations under Section 5.11, customary provisions in partnership agreements, limited liability company organizational governance documents, asset sale and stock sale agreements and other similar agreements entered into in the ordinary course of business that restrict the transfer of ownership interests in such partnership, limited liability company or similar person; (x) restrictions on cash or other deposits or net worth imposed by suppliers or landlords under contracts entered into in the ordinary course of business; (xi) any instrument governing Indebtedness assumed in connection with any Permitted Acquisition, which encumbrance or restriction is not applicable to any

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person, or the properties or assets of any person, other than the person or the properties or assets of the person so acquired; (xii) in the case of any joint venture and in respect of any matters referred to in clauses (b) and (c) above, the Organizational Documents or the joint venture agreement or stockholders agreements solely to the extent affecting the Equity Interests of or property held in the subject joint venture; (xiii) Indebtedness of any Foreign Restricted Subsidiary (to the extent such restrictions or encumbrances are applicable to such Foreign Restricted Subsidiary); (xiv) restrictions which are not more restrictive than those contained in this Agreement contained in any documents governing Indebtedness incurred after the Closing Date in accordance with the provisions of this Agreement; and (xv) any encumbrances or restrictions imposed by any amendments or refinancings, refundings, renewals or extensions that are otherwise permitted by the Loan Documents of the contracts, instruments or obligations referred to in clauses (iii), (viii) or (xi) above; provided that such amendments or refinancings, refundings, renewals or extensions are no more materially restrictive with respect to such encumbrances and restrictions than those prior to such amendment or refinancing.

SECTION 6.12              Limitation on Issuance of Capital Stock.

(a)           With respect to Holdings, issue any Equity Interest that is not Qualified Capital Stock.

(b)           With respect to Borrower or any Restricted Subsidiary of Borrower (other than a JV Subsidiary), issue any Equity Interest (including by way of sales of treasury stock) or any options or warrants to purchase, or securities convertible into, any Equity Interest, except (i) for stock splits, stock dividends and additional issuances of Equity Interests by a Restricted Subsidiary which do not decrease the percentage ownership of Borrower or any Restricted Subsidiaries in any class of the Equity Interest of such Restricted Subsidiary; (ii) Restricted Subsidiaries of Borrower may issue Equity Interests to Borrower or any Restricted Subsidiary of Borrower (provided that no Subsidiary Guarantor shall issue Equity Interests (or any such options, warrants or convertible securities) to a Non-Guarantor Subsidiary), (iii) Borrower may issue common stock that is Qualified Capital Stock to Holdings; and (iv) any Restricted Subsidiary may issue a de minimis amount of Equity Interests to a third party to comply with Requirements of Law.  All Equity Interests issued in accordance with this Section 6.12(b) shall, to the extent required by Sections 5.11 and 5.12 or any Security Agreement or if such Equity Interests are issued by Borrower, be delivered to the Collateral Agent for pledge pursuant to the applicable Security Agreement.

SECTION 6.13              Limitation on Creation of Subsidiaries.

Establish, create or acquire any additional Subsidiaries without the prior written consent of the Required Lenders; provided that, without such consent, Borrower and its Subsidiaries may (i) establish or create one or more Wholly Owned Subsidiaries, (ii) establish, create or acquire one or more Subsidiaries in connection with an Investment made pursuant to Section 6.04 or (iii) acquire one or more Subsidiaries in connection with a Permitted Acquisition, so long as, in each case, Section 5.11(b) shall be complied with.

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SECTION 6.14              Business.

(a)           With respect to Holdings, engage in any business activities or have any properties or liabilities, other than (i) its ownership of the Equity Interests of Borrower, (ii) ownership of Equity Interest in Subsidiaries (other than Borrower) that are not material to the assets and operations of the Companies, (iii) obligations under the Loan Documents and the Senior Note Documents, (iv) issuances of Equity Interests and other activities otherwise expressly permitted by this Agreement, (v) issuances of guarantees of Indebtedness of Borrower, to the extent such Indebtedness are otherwise permitted by this Agreement, (vi) activities related to the maintenance of its corporate existence, (vii) liabilities and activities to comply with applicable law, (viii) the maintenance of stock option and ownership plans, (ix) receipt and payment of Dividends otherwise permitted under this Agreement, (x) compliance with its obligations with respect to Indebtedness otherwise permitted under this Agreement, (xi) the activities set forth on Schedule 6.14 and (xii) activities and properties incidental to the foregoing clauses (i) through (xi).

(b)           With respect to Borrower and the other Restricted Subsidiaries, engage (directly or indirectly) in any business other than those businesses in which Borrower and its Restricted Subsidiaries are engaged on the Closing Date as described in the Confidential Information Memorandum (or which are similar, complementary, reasonably related thereto or are reasonable extensions thereof).

SECTION 6.15              Limitation on Accounting Changes.

Make or permit any material change in accounting policies or reporting practices, without the consent of the Required Lenders, which consent shall not be unreasonably withheld, except changes that are required by GAAP or recommended by its independent public accountants.

SECTION 6.16              Fiscal Year.

Change its fiscal year-end to a date other than the Friday nearest to September 30.

SECTION 6.17              No Further Negative Pledge.

Enter into any agreement, instrument, deed or lease which prohibits or limits the ability of any Loan Party to create, incur, assume or suffer to exist any Liens on or pledge of any property of such Loan Party (or any income or revenues therefrom) securing the Secured Obligations or which would require the direct or indirect granting of any Lien securing any Indebtedness or other obligation by virtue of the granting of Liens on or pledge of property of any Loan Party (or any income or revenues therefrom) to secure the Secured Obligations other than (a) any prohibition or limitation that restricts subletting or assignment of any lease governing a leasehold interest of Borrower or a Restricted Subsidiary, (b) any agreement in effect at the time such Restricted Subsidiary becomes a Subsidiary of Borrower, so long as such agreement was not entered into in contemplation of such person becoming a Subsidiary, (c) customary restrictions and conditions contained in any agreement relating to the sale of any property permitted under Section 6.06 pending the consummation of such sale and (d) any prohibition or limitation existing in an agreement relating to Indebtedness permitted under Section 6.01(e).

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SECTION 6.18              Compliance with Anti-Terrorism Laws.

(a)           In connection with the Loans, knowingly (after reasonable due diligence), (i) conduct any business or engage in making or receiving any contribution of funds, goods or services to or for the benefit of any Embargoed Person, (ii) deal in, or otherwise engage in any transaction relating to, any property or interests in property blocked pursuant to any Anti-Terrorism Law or (iii) engage in or conspire to engage in any transaction that evades or avoids, or has the purpose of evading or avoiding, or attempts to violate, any Anti-Terrorism Law.

(b)           In connection with the Loans, knowingly (after reasonable due diligence), cause or permit any of the funds of such Loan Party that are used to repay the Loans to be derived from any unlawful activity with the result that the making of the Loans would be in violation of any Anti-Terrorism Law.

(c)           Knowingly (after reasonable due diligence), cause or permit (i) an Embargoed Person to have any interest in or benefit of any nature whatsoever in the Loan Parties or (ii) any of the funds or properties of the Loan Parties that are used to repay the Loans to constitute property of, or be beneficially owned directly or indirectly by, an Embargoed Person.

(d)           The Loan Parties shall deliver to the Lenders any certification reasonably requested from time to time by any Lender in its reasonable discretion, confirming the Loan Parties’ compliance with this Section 6.18.

ARTICLE VII.

GUARANTEE

SECTION 7.01              The Guarantee.

The Guarantors hereby jointly and severally guarantee, as a primary obligor and not as a surety to each Secured Party and their respective successors and assigns, the prompt payment in full when due (whether at stated maturity, by required prepayment, declaration, demand, by acceleration or otherwise) of the principal of and interest on (including any interest, fees, costs or charges that would accrue but for the provisions of the Title 11 of the United States Code after any bankruptcy or insolvency petition under Title 11 of the United States Code) the Loans made by the Lenders to, and the Notes held by each Lender of, Borrower, and all other Secured Obligations from time to time owing to the Secured Parties by any Loan Party under any Loan Document or any Hedging Agreement or Treasury Services Agreement entered into with a counterparty that is a Secured Party, in each case strictly in accordance with the terms thereof (such obligations being herein collectively called the “Guaranteed Obligations”).  The Guarantors hereby jointly and severally agree that if Borrower or other Guarantor(s) shall fail to pay in full when due (whether at stated maturity, by acceleration or otherwise) any of the Guaranteed Obligations, the Guarantors will promptly pay the same in cash, without any demand or notice whatsoever, and that in the case of any extension of time of payment or renewal of any of the Guaranteed Obligations, the same will be promptly paid in full when due (whether at extended maturity, by acceleration or otherwise) in accordance with the terms of such extension or renewal.

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SECTION 7.02              Obligations Unconditional.

The obligations of the Guarantors under Section 7.01 shall constitute a guaranty of payment and to the fullest extent permitted by applicable Requirements of Law, are absolute, irrevocable and unconditional, joint and several, irrespective of the value, genuineness, validity, regularity or enforceability of the Guaranteed Obligations of Borrower under this Agreement, the Notes, if any, or any other agreement or instrument referred to herein or therein, or any substitution, release or exchange of any other guarantee of or security for any of the Guaranteed Obligations, and, irrespective of any other circumstance whatsoever that might otherwise constitute a legal or equitable discharge or defense of a surety or Guarantor (except for payment in full).  Without limiting the generality of the foregoing, it is agreed that the occurrence of any one or more of the following shall not alter or impair the liability of the Guarantors hereunder which shall remain absolute, irrevocable and unconditional under any and all circumstances as described above:

(i)            at any time or from time to time, without notice to the Guarantors, the time for any performance of or compliance with any of the Guaranteed Obligations shall be extended, or such performance or compliance shall be waived;

(ii)           any of the acts mentioned in any of the provisions of this Agreement or the Notes, if any, or any other agreement or instrument referred to herein or therein shall be done or omitted;

(iii)          the maturity of any of the Guaranteed Obligations shall be accelerated, or any of the Guaranteed Obligations shall be amended in any respect, or any right under the Loan Documents or any other agreement or instrument referred to herein or therein shall be amended or waived in any respect or any other guarantee of any of the Guaranteed Obligations or any security therefor shall be released or exchanged in whole or in part or otherwise dealt with;

(iv)          any Lien or security interest granted to, or in favor of, Issuing Bank or any Lender or Agent as security for any of the Guaranteed Obligations shall fail to be perfected; or

(v)           the release of any other Guarantor pursuant to Section 7.09.

The Guarantors hereby expressly waive diligence, presentment, demand of payment, protest and all notices whatsoever, and any requirement that any Secured Party exhaust any right, power or remedy or proceed against Borrower under this Agreement or the Notes, if any, or any other agreement or instrument referred to herein or therein, or against any other person under any other guarantee of, or security for, any of the Guaranteed Obligations.  The Guarantors waive any and all notice of the creation, renewal, extension, waiver, termination or accrual of any of the Guaranteed Obligations and notice of or proof of reliance by any Secured Party upon this Guarantee or acceptance of this Guarantee, and the Guaranteed Obligations, and any of them, shall conclusively be deemed to have been created, contracted or incurred in reliance upon this Guarantee, and all dealings between Borrower and the Secured Parties shall likewise be conclusively presumed to have been had or consummated in reliance upon this Guarantee.  This Guarantee

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shall be construed as a continuing, absolute, irrevocable and unconditional guarantee of payment without regard to any right of offset with respect to the Guaranteed Obligations at any time or from time to time held by Secured Parties, and the obligations and liabilities of the Guarantors hereunder shall not be conditioned or contingent upon the pursuit by the Secured Parties or any other person at any time of any right or remedy against Borrower or against any other person which may be or become liable in respect of all or any part of the Guaranteed Obligations or against any collateral security or guarantee therefor or right of offset with respect thereto.  This Guarantee shall remain in full force and effect and be binding in accordance with and to the extent of its terms upon the Guarantors and the successors and assigns thereof, and shall inure to the benefit of the Lenders, and their respective successors and assigns, notwithstanding that from time to time during the term of this Agreement there may be no Guaranteed Obligations outstanding.

SECTION 7.03              Reinstatement.

The obligations of the Guarantors under this Article VII shall be automatically reinstated if and to the extent that for any reason any payment by or on behalf of Borrower or other Loan Party in respect of the Guaranteed Obligations is rescinded or must be otherwise restored by any holder of any of the Guaranteed Obligations, whether as a result of any proceedings in bankruptcy or reorganization or otherwise.

SECTION 7.04              Subrogation; Subordination.

Each Guarantor hereby agrees that until the indefeasible payment and satisfaction in full in cash of all Guaranteed Obligations (other than Contingent Obligations for which no claim has been made) and the expiration and termination of the Commitments of the Lenders under this Agreement it shall not assert any claim and shall not exercise any right or remedy, direct or indirect, arising by reason of any performance by it of its guarantee in Section 7.01, whether by subrogation or otherwise, against Borrower or any other Guarantor of any of the Guaranteed Obligations or any security for any of the Guaranteed Obligations.  Any Indebtedness of any Loan Party permitted pursuant to Section 6.01(d) shall be subordinated to such Loan Party’s Secured Obligations in the manner set forth in the Intercompany Subordination Agreement.

SECTION 7.05              Remedies.

The Guarantors jointly and severally agree that, as between the Guarantors and the Lenders, the obligations of Borrower under this Agreement and the Notes, if any, may be declared to be forthwith due and payable as provided in Section 8.01 (and shall be deemed to have become automatically due and payable in the circumstances provided in Section 8.01) for purposes of Section 7.01, notwithstanding any stay, injunction or other prohibition preventing such declaration (or such obligations from becoming automatically due and payable) as against Borrower and that, in the event of such declaration (or such obligations being deemed to have become automatically due and payable), such obligations (whether or not due and payable by Borrower) shall forthwith become due and payable by the Guarantors for purposes of Section 7.01.

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SECTION 7.06              Instrument for the Payment of Money.

Each Guarantor hereby acknowledges that the guarantee in this Article VII constitutes an instrument for the payment of money, and consents and agrees that any Lender or Agent, at its sole option, in the event of a dispute by such Guarantor in the payment of any moneys due hereunder, shall have the right to bring a motion-action under New York CPLR Section 3213.

SECTION 7.07              Continuing Guarantee.

The guarantee in this Article VII is a continuing guarantee of payment, and shall apply to all Guaranteed Obligations whenever arising.

SECTION 7.08              General Limitation on Guarantee Obligations.

It being understood that the intent of the Secured Parties is to obtain a guaranty from each Guarantor, and the intent of each Guarantor is to incur guarantee obligations, in an amount no greater than the largest amount that would not render such obligations subject to avoidance under Section 548 of the Bankruptcy Code or any applicable state law relating to fraudulent conveyances or fraudulent transfers, it is hereby agreed that:

(a)           If (i) the sum of the obligations of the Guarantors hereunder (the “Guarantor Obligations”) exceeds (ii) the sum (the “Total Available Net Assets”) of the Maximum Available Net Assets (as defined in Section 7.10) of each Guarantor and Borrower, in the aggregate, then the Guarantor Obligations of each Guarantor shall be limited to the greater of (x) the Total Available Net Assets and (y) the value received by such Guarantor in connection with the incurrence of the Guarantor Obligations to the greatest extent such value can be determined; and

(b)           if, but for the operation of this Section 7.08(b) and notwithstanding Section 7.08(a), the Guarantor Obligations of any Guarantor hereunder otherwise would be subject to avoidance under Section 548 of the Bankruptcy Code or any applicable state law relating to fraudulent conveyances or fraudulent transfers, taking into consideration such Guarantor’s (i) rights of contribution, reimbursement and indemnity from Borrower and the other Guarantors with respect to amounts paid by such Guarantor in respect of the Obligations (including pursuant to Section 7.10) (calculated so as to reasonably maximize the total amount of obligations able to be incurred hereunder), and (ii) rights of subrogation to the rights of the Secured Parties, then the Guarantor Obligations of such Guarantor shall be the largest amount, if any, that would not leave such Guarantor, after the incurrence of such obligations, insolvent or with unreasonable small capital within the meaning of Section 548 of the Bankruptcy Code or any applicable state law relating to fraudulent conveyances or fraudulent transfers, or otherwise make such obligations subject to such avoidance.

Any Person asserting that the Guarantor Obligations of such Guarantor are subject to Section 7.08(a) or are avoidable as referenced in Section 7.08(b) shall have the burden (including the burden of production and of persuasion) of proving (a) the extent to which such Guarantor Obligations, by operation of Section 7.08(a), are less than the Obligations of Borrower owed to the Secured Parties or (b) that, without giving effect to Section 7.08(b), such Guarantor’s Guarantor

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Obligations hereunder would be avoidable and the extent to which such Guarantor Obligations, by operation of Section 7.08(b), are less than such Obligations of Borrower, as the case may be.

SECTION 7.09              Release of Guarantors.

If, in compliance with the terms and provisions of the Loan Documents, all or substantially all of the Equity Interests of any Subsidiary Guarantor (a “Transferred Guarantor”) are sold or otherwise transferred to a person or persons, none of which is Borrower or a Guarantor or a Subsidiary Guarantor is designated as an Unrestricted Subsidiary in accordance with the terms of this Agreement, such Transferred Guarantor shall, upon the consummation of such sale or transfer, be automatically released from its obligations under this Agreement (including under Section 10.03 hereof) and its obligations to pledge and grant any Collateral owned by it pursuant to any Security Document without further action by an Person and in the case of a sale of all or substantially all the Equity Interests of the Transferred Guarantor to a person or persons, none of which is Borrower or a Guarantor, the pledge of such Equity Interests to the Collateral Agent pursuant to the Security Agreements shall be automatically released without further action by any Person, and the Collateral Agent shall take such actions as are necessary to effect each release described in this Section 7.09 in accordance with the relevant provisions of the Security Documents, so long as Borrower shall have provided the Agents such certifications or documents as any Agent shall reasonably request in order to demonstrate compliance with this Agreement; provided that such Guarantor is also released from its obligations under the Senior Note Documents on the same terms.

SECTION 7.10              Right of Contribution.

In order to provide for just and equitable contribution, indemnity and reimbursement among the Guarantors and any other Loan Parties, including Borrower, in connection with the execution of this Agreement, the Loan Parties have agreed among themselves that if any Guarantor satisfies some or all of the Guaranteed Obligations (a “Funding Guarantor”), the Funding Guarantor shall be entitled to contribution, indemnity or reimbursement, as applicable, from the other Loan Parties that have positive Maximum Available Net Assets (as defined below) for all payments made by the Funding Guarantor in satisfying the Guaranteed Obligations, so that each Loan Party that remains obligated under this Article VII or any other guaranty or otherwise for the Obligations at the time that a Funding Guarantor makes such payment, without regard to the making of such payment (a “Remaining Loan Party”), and has a positive Maximum Available Net Assets shall bear a portion of such payment equal to the percentage that such Remaining Loan Party’s Maximum Available Net Assets bears to the aggregate Maximum Available Net Assets of all Loan Parties that have positive Maximum Available Net Assets, provided that no Remaining Loan Party’s obligation to make such contribution, indemnity or reimbursement payments hereunder shall exceed an amount equal to the Maximum Available Net Assets of such Remaining Loan Party.  Each Guarantor’s right of contribution shall be subject to the terms and conditions of Section 7.04.

As used herein,

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“Available Net Assets” shall mean, with respect to any Loan Party, the amount, as of the respective date of calculation, by which the sum of a person’s assets (including subrogation, indemnity, contribution, reimbursement and similar rights that the Loan Party may have, but excluding any such rights in respect of the Guarantor Obligations and the Senior Note Guarantees), determined on the basis of a “fair valuation” or their “fair saleable value” (whichever is the applicable test under Section 548 and other relevant provisions of the Bankruptcy Code and the relevant state fraudulent conveyance or transfer laws), is greater than the amount that will be required to pay all of such person’s debts, in each case matured or unmatured, contingent or otherwise, as of the date of calculation, but excluding liabilities arising under Article VII and excluding, to the maximum extent permitted by the Requirements of Law with the objective of avoiding rendering such person insolvent, liabilities subordinated to the Obligations or Guarantor Obligations arising under the Senior Note Guarantees or out of loans or advances made to such Loan Party by any other person, and

“Maximum Available Net Assets” shall mean, with respect to any Loan Party, the greatest of the Available Net Assets of such Loan Party calculated as of the following dates:  (A) the date on which such person becomes a Loan Party and becomes obligated under any Senior Note or Senior Note Guarantee, and (B) each date on which such Loan Party expressly reaffirms its Guarantee under Article VII and its Senior Note Guarantee.

Each Guarantor shall be deemed to expressly reaffirm its Guarantee and its Senior Note Guarantee upon each borrowing of a Loan and each Letter of Credit issuance.  The meaning of the terms “fair valuation” and “fair saleable value” and the calculation of assets and liabilities shall be determined and made in accordance with the relevant provisions of the Bankruptcy Code and applicable state fraudulent conveyance or transfer laws.

ARTICLE VIII.

EVENTS OF DEFAULT

SECTION 8.01              Events of Default.

Upon the occurrence and during the continuance of the following events, (each an “Event of Default”):

(a)           default shall be made in the payment of any principal of any Loan or any Reimbursement Obligation when and as the same shall become due and payable, whether at the due date thereof (including a Term Loan Repayment Date) or at a date fixed for prepayment (whether voluntary or mandatory) thereof or by acceleration thereof or otherwise;

(b)           default shall be made in the payment of any interest on any Loan or any Fee or any other amount (other than an amount referred to in paragraph (a) above) due under any Loan Document, when and as the same shall become due and payable, and such default shall continue unremedied for a period of five Business Days;

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(c)           any representation or warranty made in writing or deemed made in or in connection with any Loan Document or the borrowings or issuances of Letters of Credit hereunder, or any representation, warranty, statement or information contained in any report, certificate, financial statement or other instrument furnished in connection with or pursuant to any Loan Document, shall prove to have been false or misleading in any material respect when so made, deemed made or furnished; provided that with respect to the representations or warranties made on the Closing Date (i) the breach of which, individually and in the aggregate, could not reasonably be expected to result in a Material Adverse Effect (disregarding, for this purpose, any materiality or Material Adverse Effect qualifier in any such representation or warranty) and (ii) which are reasonably capable of cure within such period, such breach shall continue unremedied or shall not be waived for a period of 30 days.

(d)           default shall be made in the due observance or performance by any Company of any covenant, condition or agreement contained in Section 5.02(a), 5.03(a) or 5.08 or in Article VI;

(e)           default shall be made in the due observance or performance by any Company of any covenant, condition or agreement contained in any Loan Document (other than those specified in paragraphs (a), (b) or (d) immediately above) and such default shall continue unremedied or shall not be waived for a period of 30 days after written notice thereof from the Administrative Agent or the Required Lenders to Borrower;

(f)            any Company shall (i) fail to pay any principal or interest, regardless of amount, due in respect of any Indebtedness (other than the Obligations), when and as the same shall become due and payable beyond any applicable grace period, or (ii) fail to observe or perform any other term, covenant, condition or agreement contained in any agreement or instrument evidencing or governing any such Indebtedness if the effect of any failure referred to in this clause (ii) is to cause, or to permit the holder or holders of such Indebtedness or a trustee or other representative on its or their behalf (with or without the giving of notice) to cause, such Indebtedness to become due prior to its stated maturity or become subject to a mandatory offer purchase by the obligor; provided that it shall not constitute an Event of Default pursuant to this paragraph (f) unless the aggregate amount of all such Indebtedness for all Companies referred to in clauses (i) and (ii) exceeds $10,000,000 at any one time (provided that, in the case of Hedging Obligations, the amount counted for this purpose shall be the amount payable by all Companies if such Hedging Obligations were terminated at such time);

(g)           an involuntary proceeding shall be commenced or an involuntary petition shall be filed in a court of competent jurisdiction seeking (i) relief in respect of Holdings, Borrower or any Material Subsidiary, or of a substantial part of the property of Holdings, Borrower or any Material Subsidiary, under Title 11 of the U.S. Code, as now constituted or hereafter amended, or any other federal, state or foreign bankruptcy, insolvency, receivership or similar law; (ii) the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for Holdings, Borrower or any Material Subsidiary or for a substantial part of the property of Holdings, Borrower or any Material Subsidiary; or (iii) the winding-up or liquidation of Holdings, Borrower or any Material Subsidiary; and

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such proceeding or petition shall continue undismissed for 60 days or an order or decree approving or ordering any of the foregoing shall be entered;

(h)           Holdings, Borrower or any Material Subsidiary shall (i) voluntarily commence any proceeding or file any petition seeking relief under Title 11 of the United States Code, as now constituted or hereafter amended, or any other federal, state or foreign bankruptcy, insolvency, receivership or similar law; (ii) consent to the institution of, or fail to contest in a timely and appropriate manner, any proceeding or the filing of any petition described in clause (g) above; (iii) apply for or consent to the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for Holdings, Borrower or any Material Subsidiary or for a substantial part of the property of Holdings, Borrower or any Material Subsidiary; (iv) file an answer admitting the material allegations of a petition filed against it in any such proceeding; (v) make a general assignment for the benefit of creditors; (vi) become unable, admit in writing its inability or fail generally to pay its debts as they become due; (vii) take any action for the purpose of effecting any of the foregoing; or (viii) other than as permitted pursuant to Section 6.05, wind up or liquidate;

(i)            one or more judgments, orders or decrees for the payment of money in an aggregate amount in excess of $10,000,000 (except to the extent covered by insurance for which the carrier has not denied liability) shall be rendered against any Company or any combination thereof and the same shall remain undischarged, unvacated or unbonded for a period of 30 consecutive days during which execution shall not be effectively stayed, or any action shall be legally taken by a judgment creditor to levy upon properties of any Company to enforce any such judgment;

(j)            one or more ERISA Events shall have occurred that, when taken together with all other such ERISA Events to the extent that there are any unsatisfied liabilities with respect thereto, could reasonably be expected to result in liability of any Company (or Companies) in an aggregate amount exceeding $10,000,000 or in the imposition of a Lien on any properties of a Company;

(k)           any security interest and Lien on Collateral with a value in excess of $1,000,000 purported to be created by any Security Document shall cease to be in full force and effect, or shall cease to give the Collateral Agent, for the benefit of the Secured Parties, the Liens, rights, powers and privileges purported to be created and granted under such Security Document (including a perfected first priority security interest in and Lien on all of the Collateral thereunder (except as otherwise expressly provided in such Security Document or except to the extent any loss of perfection or priority results from the failure of the Collateral Agent to file UCC continuation statements or maintain possession of certificates actually delivered to it representing the securities pledged to it under the Security Agreement)) in favor of the Collateral Agent, or shall be asserted by Borrower or any other Loan Party not to be a valid, perfected, first priority (except as otherwise expressly provided in this Agreement or such Security Document) security interest in or Lien on the Collateral covered thereby, in each case, for any reason, other than action or inaction of any Agent or Lender and other than as a result of any termination or release in accordance with the terms of this Agreement;

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(l)            any Loan Document or any material provisions thereof shall at any time and for any reason be declared by a court of competent jurisdiction to be null and void, or a proceeding shall be commenced by any Loan Party or any other person, or by any Governmental Authority, seeking to establish the invalidity or unenforceability thereof (exclusive of questions of interpretation of any provision thereof), or any Loan Party shall repudiate or deny any portion of its liability or obligation for the Obligations; or

(m)          there shall have occurred a Change in Control;

then, and in every such event (other than an Event of Default with respect to Holdings or Borrower described in paragraph (g) or (h) above), and at any time thereafter during the continuance of such event, the Administrative Agent may, and at the request of the Required Lenders shall, by notice to Borrower, take either or both of the following actions, at the same or different times:  (i) terminate forthwith the Commitments and (ii) declare the Loans and Reimbursement Obligations then outstanding to be forthwith due and payable in whole or in part, whereupon the principal of the Loans and Reimbursement Obligations so declared to be due and payable, together with accrued interest thereon and any unpaid accrued Fees and all other Obligations of Borrower accrued hereunder and under any other Loan Document, shall become forthwith due and payable, without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived by Borrower and the Guarantors to the extent permitted by Requirements of Law, anything contained herein or in any other Loan Document to the contrary notwithstanding; and in any event, with respect to Holdings or Borrower described in paragraph (g) or (h) above, the Commitments shall automatically terminate and the principal of the Loans and Reimbursement Obligations then outstanding, together with accrued interest thereon and any unpaid accrued Fees and all other Obligations of Borrower accrued hereunder and under any other Loan Document, shall automatically become due and payable, without presentment, demand, protest or any other notice of any kind, all of which are hereby expressly waived by Borrower and the Guarantors to the extent permitted by Requirements of Law, anything contained herein or in any other Loan Document to the contrary notwithstanding.

SECTION 8.02              Application of Proceeds.

The proceeds received by the Collateral Agent in respect of any sale of, collection from or other realization upon all or any part of the Collateral pursuant to the exercise by the Collateral Agent of its remedies shall be applied, in full or in part, together with any other sums then held by the Collateral Agent pursuant to this Agreement, promptly by the Collateral Agent as follows:

(a)           First, to the payment of all out-of-pocket costs and expenses, fees, commissions and taxes of such sale, collection or other realization including compensation to the Collateral Agent and its agents and counsel, and all expenses, liabilities and advances made or incurred by the Collateral Agent in connection therewith and all amounts for which the Collateral Agent is entitled to indemnification pursuant to the provisions of any Loan Document, together with interest on each such amount at the highest rate then in effect under this Agreement from and after the date such amount is due, owing or unpaid until paid in full;

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(b)           Second, to the payment of all other out-of-pocket costs and expenses of such sale, collection or other realization including compensation to the other Secured Parties and their agents and counsel and all costs, liabilities and advances made or incurred by the other Secured Parties in connection therewith, together with interest on each such amount at the highest rate then in effect under this Agreement from and after the date such amount is due, owing or unpaid until paid in full;

(c)           Third, without duplication of amounts applied pursuant to clauses (a) and (b) above, to the indefeasible payment in full in cash, pro rata, of interest and other amounts constituting Obligations (other than principal, Reimbursement Obligations and obligations to cash collateralize Letters of Credit) and any fees, premiums and scheduled periodic payments due under Hedging Agreements or Treasury Services Agreements constituting Secured Obligations and any interest accrued thereon, in each case equally and ratably in accordance with the respective amounts thereof then due and owing;

(d)           Fourth, to the indefeasible payment in full in cash, pro rata, of principal amount of the Obligations and any premium thereon (including Reimbursement Obligations and obligations to cash collateralize Letters of Credit) and any breakage, termination or other payments under Hedging Agreements and Treasury Services Agreements constituting Secured Obligations and any interest accrued thereon; and

(e)           Fifth, the balance, if any, to the person lawfully entitled thereto (including the applicable Loan Party or its successors or assigns) or as a court of competent jurisdiction may direct.

In the event that any such proceeds are insufficient to pay in full the items described in clauses (a) through (e) of this Section 8.02, the Loan Parties shall remain liable, jointly and severally, for any deficiency.

ARTICLE IX.

THE ADMINISTRATIVE AGENT AND THE COLLATERAL AGENT

SECTION 9.01              Appointment and Authority.

Each of the Lenders and the Issuing Bank hereby irrevocably appoints UBS AG, Stamford Branch, to act on its behalf as the Administrative Agent and the Collateral Agent hereunder and under the other Loan Documents and authorizes such Agents to take such actions on its behalf and to exercise such powers as are delegated to such Agents by the terms hereof or thereof, together with such actions and powers as are reasonably incidental thereto.  The provisions of this Article are solely for the benefit of the Administrative Agent, the Collateral Agent, the Lenders and the Issuing Bank, and neither Borrower nor any other Loan Party shall have rights as a third party beneficiary of any of such provisions.

SECTION 9.02              Rights as a Lender.

Each person serving as an Agent hereunder shall have the same rights and powers in its capacity as a Lender as any other Lender and may exercise the same as though it were not an

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Agent and the term “Lender” or “Lenders” shall, unless otherwise expressly indicated or unless the context otherwise requires, include each person serving as an Agent hereunder in its individual capacity.  Such person and its Affiliates may accept deposits from, lend money to, act as the financial advisor or in any other advisory capacity for and generally engage in any kind of business with Borrower or any Subsidiary or other Affiliate thereof as if such person were not an Agent hereunder and without any duty to account therefor to the Lenders.

SECTION 9.03              Exculpatory Provisions.

No Agent shall have any duties or obligations except those expressly set forth herein and in the other Loan Documents.  Without limiting the generality of the foregoing, no Agent:

(i)            shall be subject to any fiduciary or other implied duties, regardless of whether a Default has occurred and is continuing;

(ii)           shall have any duty to take any discretionary action or exercise any discretionary powers, except discretionary rights and powers expressly contemplated hereby or by the other Loan Documents that such Agent is required to exercise as directed in writing by the Required Lenders (or such other number or percentage of the Lenders as shall be expressly provided for herein or in the other Loan Documents); provided that such Agent shall not be required to take any action that, in its reasonable judgment or the reasonable judgment of its counsel, may expose such Agent to liability or that is contrary to any Loan Document or applicable Requirements of Law; and

(iii)          shall, except as expressly set forth herein and in the other Loan Documents, have any duty to disclose, and shall not be liable for the failure to disclose, any information relating to Borrower or any of its Affiliates that is communicated to or obtained by the person serving as such Agent or any of its Affiliates in any capacity.

No Agent shall be liable for any action taken or not taken by it (x) with the consent or at the request of the Required Lenders (or such other number or percentage of the Lenders as shall be necessary, or as such Agent shall believe in good faith shall be necessary, under the circumstances as provided in Section 10.02) or (y) in the absence of its own gross negligence or willful misconduct.  No Agent shall be deemed to have knowledge of any Default unless and until notice describing such Default is given to such Agent by Borrower, a Lender or the Issuing Bank.

No Agent shall be responsible for or have any duty to ascertain or inquire into (i) any statement, warranty or representation made in or in connection with this Agreement or any other Loan Document, (ii) the contents of any certificate, report or other document delivered hereunder or thereunder or in connection herewith or therewith, (iii) the performance or observance of any of the covenants, agreements or other terms or conditions set forth herein or therein or the occurrence of any Default, (iv) the validity, enforceability, effectiveness or genuineness of this Agreement, any other Loan Document or any other agreement, instrument or document or (v) the satisfaction of any condition set forth in Article IV or elsewhere herein, other than to confirm receipt of items expressly required to be delivered to such Agent.  Without limiting the generality of the foregoing, the use of the term “agent” in this Agreement with reference to the Administrative Agent or the Collateral Agent is not intended to connote any fiduciary or other implied (or

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express) obligations arising under agency doctrine of any applicable law.  Instead, such term us used merely as a matter of market custom and is intended to create or reflect only an administrative relationship between independent contracting parties.

Each party to this Agreement acknowledges and agrees that the Administrative Agent may use an outside service provider for the tracking of all UCC financing statements required to be filed pursuant to the Loan Documents and notification to the Administrative Agent, of, among other things, the upcoming lapse or expiration thereof, and that any such service provider will be deemed to be acting at the request and on behalf of Borrower and the other Loan Parties.  No Agent shall be liable for any action taken or not taken by any such service provider.

SECTION 9.04              Reliance by Agent.

Each Agent shall be entitled to rely upon, and shall not incur any liability for relying upon, any notice, request, certificate, consent, statement, instrument, document or other writing (including any electronic message, Internet or intranet website posting or other distribution) believed by it to be genuine and to have been signed, sent or otherwise authenticated by the proper person.  Each Agent also may rely upon any statement made to it orally or by telephone and believed by it to have been made by the proper person, and shall not incur any liability for relying thereon.  In determining compliance with any condition hereunder to the making of a Loan, or the issuance of a Letter of Credit, that by its terms must be fulfilled to the satisfaction of a Lender or the Issuing Bank, the Administrative Agent may presume that such condition is satisfactory to such Lender or the Issuing Bank unless the Administrative Agent shall have received notice to the contrary from such Lender or the Issuing Bank prior to the making of such Loan or the issuance of such Letter of Credit.  Each Agent may consult with legal counsel (who may be counsel for Borrower), independent accountants and other experts selected by it, and shall be entitled to rely upon the advice of any such counsel, accountants or experts and shall not be liable for any action taken or not taken by it in accordance with such advice.

SECTION 9.05              Delegation of Duties.

Each Agent may perform any and all of its duties and exercise its rights and powers hereunder or under any other Loan Document by or through, or delegate any and all such rights and powers to, any one or more sub-agents appointed by such Agent.  Each Agent and any such sub-agent may perform any and all of its duties and exercise its rights and powers by or through their respective Related Parties.  The exculpatory provisions of this Article shall apply to any such sub-agent and to the Related Parties of each Agent and any such sub-agent, and shall apply to their respective activities in connection with the syndication of the credit facilities provided for herein as well as activities as Agent.

SECTION 9.06              Resignation of Agent.

(a)           Each Agent may at any time give notice of its resignation to the Lenders, the Issuing Bank and Borrower.  Upon receipt of any such notice of resignation, the Required Lenders shall have the right to appoint a successor, which shall be a bank with an office in the United States, or an Affiliate of any such bank with an office in the United States; provided that, to the extent no Default or Event of Default has occurred and is continuing at such time, Borrower

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must consent to such successor.  If no such successor shall have been so appointed by the Required Lenders and shall have accepted such appointment within 30 days after the retiring Agent gives notice of its resignation, then the retiring Agent may on behalf of the Lenders and the Issuing Bank, appoint a successor Agent meeting the qualifications set forth above (including, to the extent required above, the consent of Borrower to such successor); provided that if the Agent shall notify Borrower and the Lenders that no qualifying person has accepted such appointment, then such resignation shall nonetheless become effective in accordance with such notice and (1) the retiring Agent shall be discharged from its duties and obligations hereunder and under the other Loan Documents (except that in the case of any collateral security held by the Collateral Agent on behalf of the Lenders or the Issuing Bank under any of the Loan Documents, the retiring Collateral Agent shall continue to hold such collateral security as nominee until such time as a successor Collateral Agent is appointed) and (2) all payments, communications and determinations provided to be made by, to or through an Agent shall instead be made by or to each Lender and the Issuing Bank directly, until such time as the Required Lenders appoint a successor Agent as provided for above in this paragraph.  Upon the acceptance of a successor’s appointment as Agent hereunder, such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring (or retired) Agent, and the retiring Agent shall be discharged from all of its duties and obligations hereunder or under the other Loan Documents (if not already discharged therefrom as provided above in this paragraph).  The fees payable by Borrower to a successor Agent shall be the same as those payable to its predecessor unless otherwise agreed between Borrower and such successor.  After the retiring Agent’s resignation hereunder and under the other Loan Documents, the provisions of this Article IX and Section 10.03 shall continue in effect for the benefit of such retiring Agent, its sub-agents and their respective Related Parties in respect of any actions taken or omitted to be taken by any of them while the retiring Agent was acting as Agent.

(b)           Any resignation by UBS AG, Stamford Branch as Administrative Agent pursuant to Section 9.06(a) shall, unless UBS AG, Stamford Branch gives notice to Borrower otherwise, also constitute its resignation as Issuing Bank and Swingline Lender, and such resignation as Issuing Bank and Swingline Lender shall become effective simultaneously with the discharge of the Administrative Agent from its duties and obligations as set forth in the immediately preceding paragraph (except as to already outstanding Letters of Credit and LC Obligations and Swingline Loans, as to which the Issuing Bank and the Swingline Lender shall continue in such capacities until the LC Exposure relating thereto shall be reduced to zero and such Swingline Loans shall have been repaid, as applicable, or until the successor Administrative Agent shall succeed to the roles of Issuing Bank and Swingline Lender in accordance with the next sentence and perform the actions required by the next sentence).  Upon the acceptance of a successor’s appointment as Administrative Agent hereunder, unless UBS AG, Stamford Branch and such successor gives notice to Borrower otherwise, (i) such successor shall succeed to and become vested with all of the rights, powers, privileges and duties of the retiring Issuing Bank and Swingline Lender and (ii) the successor Issuing Bank shall issue letters of credit in substitution for the Letters of Credit, if any, outstanding at the time of such succession or make other arrangements satisfactory to the retiring Issuing to effectively assume the obligations of the retiring Issuing Bank with respect to such Letters of Credit.  At the time any such resignation of the Issuing Bank shall become effective, Borrower shall pay all unpaid fees accrued for the account of the retiring Issuing Bank pursuant to Section 2.05(c).

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SECTION 9.07Non-Reliance on Agent and Other Lenders.

Each Lender and the Issuing Bank acknowledges that it has, independently and without reliance upon any Agent or any other Lender and based on such documents and information as it has deemed appropriate, made its own credit analysis and decision to enter into this Agreement.  Each Lender further represents and warrants that it has had the opportunity to review the Confidential Information Memorandum and each other document made available to it on the Platform in connection with this Agreement and has acknowledged and accepted the terms and conditions applicable to the recipients thereof.  Each Lender and the Issuing Bank also acknowledges that it will, independently and without reliance upon any Agent or any other Lender and based on such documents and information as it shall from time to time deem appropriate, continue to make its own decisions in taking or not taking action under or based upon this Agreement, any other Loan Document or any related agreement or any document furnished hereunder or thereunder.

SECTION 9.08Withholding Tax.

To the extent required by any applicable law, the Administrative Agent may withhold from any payment to any Lender or Issuing Bank an amount equivalent to any applicable withholding tax.  Without limiting the provisions of Section 2.15(a) or (c), each Lender and the Issuing Bank shall, and does hereby, indemnify the Administrative Agent, and shall make payable in respect thereof within 30 days after demand therefor, against any and all Taxes and any and all related losses, claims, liabilities and expenses (including fees, charges and disbursements of any counsel for the Administrative Agent) incurred by or asserted against the Administrative Agent by the Internal Revenue Service or any other Governmental Authority as a result of the failure of the Administrative Agent to properly withhold tax from amounts paid to or for the account of such Lender or Issuing Bank for any reason (including, without limitation, because the appropriate form was not delivered or not property executed, or because such Lender or Issuing Bank failed to notify the Administrative Agent of a change in circumstance that rendered the exemption from, or reduction of withholding tax ineffective).  A certificate as to the amount of such payment or liability delivered to any Lender or the Issuing Bank by the Administrative Agent shall be conclusive absent manifest error. Each Lender and the Issuing Bank hereby authorizes the Administrative Agent to set off and apply any and all amounts at any time owing to such Lender or Issuing Bank under this Agreement or any other Loan Document against any amount due the Administrative Agent under this Section 9.08.  The agreements in this Section 9.08 shall survive the resignation and/or replacement of the Administrative Agent, any assignment of rights by, or the replacement of, a Lender or Issuing Bank, the termination of the Commitments and the repayment, satisfaction or discharge of all other Obligations.

SECTION 9.09No Other Duties, etc.

Anything herein to the contrary notwithstanding, none of the Bookrunner, Arranger, Syndication Agent or Co-Documentation Agent listed on the cover page hereof shall have any powers, duties or responsibilities under this Agreement or any of the other Loan Documents, except in its capacity, as applicable, as the Administrative Agent, the Collateral Agent, a Lender or the Issuing Bank hereunder and its signature, in its capacity as such, shall not be required for any action to be effective under any Loan Document, including any waiver, consent or amendment or any payoff, termination or release letter or agreement.

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SECTION 9.10Enforcement.

Notwithstanding anything to the contrary contained herein or in any other Loan Document, the authority to enforce rights and remedies hereunder and under the other Loan Documents against the Loan Parties or any of them shall be vested exclusively in, and all actions and proceedings at law in connection with such enforcement shall be instituted and maintained exclusively by, the Administrative Agent, or as the Required Lenders may require or otherwise direct, for the benefit of all the Lenders and the Issuing Bank; provided, however, that the foregoing shall not prohibit (a) the Administrative Agent from exercising on its own behalf the rights and remedies that inure to its benefit (solely in its capacity as Administrative Agent) hereunder and under the other Loan Documents, (b) the Issuing Bank or the Swingline Lender from exercising the rights and remedies that inure to its benefit (solely in its capacity as Issuing Bank or Swingline Lender, as the case may be) hereunder and under the other Loan Documents, (c) any Lender from exercising setoff rights in accordance with, and subject to, the terms of this Agreement, (d) any Lender from exercising rights or remedies pursuant to any California Mortgage with respect to the Account Collateral identified therein in accordance with, and subject to, the terms of this Agreement or (e) any Lender from filing proofs of claim or appearing and filing pleadings on its own behalf during the pendency of a proceeding relative to any Loan Party under any bankruptcy or insolvency law.

ARTICLE X.

MISCELLANEOUS

SECTION 10.01Notices.

(a)Generally.  Except in the case of notices and other communications expressly permitted to be given by telephone (and except as provided in paragraph (b) below), all notices and other communications provided for herein shall be in writing and shall be delivered by hand or overnight courier service, mailed by certified or registered mail or sent by facsimile (or e-mail (provided if a document is otherwise required to be manually signed it will be still manually signed)) as follows:

(i)if to any Loan Party, to Borrower at:

CPI International Acquisition, Inc.
607 Hansen Way
Palo Alto, CA 94304-1015
Attention:  Joel A. Littman
Facsimile No.:  (650) 846-3276
E-mail:  joel.littman@cpii.com

with copies to:

Skadden, Arps, Slate, Meagher & Flom LLP
4 Times Square
New York, NY 10036
Attention:  Thomas W. Gowan

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Facsimile No.:  (917) 777-2444
E-mail:  thomas.gowan@skadden.com

Veritas Capital
590 Madison Avenue, 41st Floor
New York, NY 10022
Attention:  Robert B. McKeon
Facsimile No.:  (212) 688-9411
E-mail:  rmckeon@veritascapital.com

(ii)if to the Administrative Agent, the Collateral Agent or Issuing Bank, to it at:

UBS AG, Stamford Branch
677 Washington Boulevard
Stamford, Connecticut 06901
Attention:  Banking Products Services Agency
Facsimile No.:  (203) 719-3180
Email:  DL-UBSAgency@ubs.com

(iii)if to a Lender, to it at its address (or facsimile number or email address) set forth in its Administrative Questionnaire; and

(iv)if to the Swingline Lender, to it at:

UBS Loan Finance LLC
677 Washington Boulevard
Stamford, Connecticut 06901
Attention:  Banking Products Services Agency
Facsimile No.:  (203) 719-3180
Email:  DL-UBSAgency@ubs.com

Notices sent by hand or overnight courier service, or mailed by certified or registered mail, shall be deemed to have been given when received; notices sent by facsimile shall be deemed to have been given when sent (except that, if not given during normal business hours for the recipient, shall be deemed to have been given at the opening of business on the next business day for the recipient).  Notices delivered through electronic communications to the extent provided in paragraph (b) below, shall be effective as provided in said paragraph (b).  Any party hereto may change its address or facsimile number or email for notices and other communications hereunder by written notice to Borrower, the Agents, the Issuing Bank and the Swingline Lender.

(b)Electronic Communications.  Notices and other communications to the Lenders and the Issuing Bank hereunder may (subject to the provisions of this Section 10.01) be delivered or furnished by electronic communication (including e-mail and Internet or intranet websites, including the Platform) pursuant to procedures approved by the Administrative Agent; provided that the foregoing shall not apply to notices to any Lender or the Issuing Bank pursuant to Article II if such Lender or the Issuing Bank, as applicable, has notified the Administrative Agent that it is incapable of receiving notices under such Article by electronic communication.  The Administrative Agent, the Collateral Agent or Borrower may, in its discretion, agree to accept

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notices and other communications to it hereunder by electronic communications pursuant to procedures approved by it (including pursuant to the provisions of this Section 10.01); provided that approval of such procedures may be limited to particular notices or communications.

Each Loan Party hereby agrees that it will provide to the Administrative Agent all information, documents and other materials that it is obligated to furnish to the Administrative Agent or the Lenders pursuant to this Agreement and any other Loan Document, including all notices, requests, financial statements, financial and other reports, certificates and other information materials (the “Communications”), by transmitting them in an electronic medium in a format reasonably acceptable to the Administrative Agent at DL-UBSagency@ubs.com or at such other e-mail address(es) provided to Borrower from time to time or in such other form as the Administrative Agent shall require.  In addition, each Loan Party agrees to continue to provide the Communications to the Administrative Agent in the manner specified in this Agreement or any other Loan Document or in such other form as the Administrative Agent shall require.  Nothing in this Section 10.01 shall prejudice the right of the Agents, the Issuing Bank, any Lender or any Loan Party to give any notice or other communication pursuant to this Agreement or any other Loan Document in any other manner specified in this Agreement or any other Loan Document or as any such Agent or the Issuing Bank, as the case may be, shall require.

Unless the Administrative Agent otherwise prescribes, (i) notices and other communications sent to an e-mail address shall be deemed received upon the sender’s receipt of an acknowledgement from the intended recipient (such as by the “return receipt requested” function, as available, return e-mail or other written acknowledgement); provided that if such notice or other communication is not sent during the normal business hours of the recipient, such notice or communication shall be deemed to have been sent at the opening of business on the next business day for the recipient, and (ii) notices or communications posted to an Internet or intranet website shall be deemed received upon the deemed receipt by the intended recipient at its e-mail address as described in the foregoing clause (i) of notification that such notice or communication is available and identifying the website address therefor.

To the extent consented to by the Administrative Agent in writing from time to time, the Administrative Agent agrees that receipt of the Communications (other than any such Communication that (i) relates to a request for a new, or a conversion of an existing, Borrowing or other extension of credit (including any election of an interest rate or interest period relating thereto), (ii) relates to the payment of any principal or other amount due under this Agreement prior to the scheduled date therefor, (iii) provides notice of any Default under this Agreement or (iv) is required to be delivered to satisfy any condition precedent to the effectiveness of this Agreement and/or any borrowing or other extension of credit hereunder) by the Administrative Agent at its e-mail address(es) set forth above shall constitute effective delivery of the Communications to the Administrative Agent for purposes of the Loan Documents.

(c)Platform.  Each Loan Party further agrees that any Agent may make the Communications available to the Lenders by posting the Communications on SyndTrak or a substantially similar secure electronic transmission system (the “Platform”).  The Platform is provided “as is” and “as available.”  The Agents do not warrant the accuracy or completeness of the Communications, or the adequacy of the Platform and expressly disclaim liability for errors or omissions in the communications.  No warranty of any kind, express, implied or statutory, including, without

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limitation, any warranty of merchantability, fitness for a particular purpose, non-infringement of third party rights or freedom from viruses or other code defects, is made by any Agent in connection with the Communications or the Platform.  In no event shall any Agent or any of its Related Parties have any liability to the Loan Parties, any Lender or any other person for damages of any kind, including direct or indirect, special, incidental or consequential damages, losses or expenses (whether in tort, contract or otherwise) arising out of any Loan Party’s or such Agent’s transmission of communications through the Internet, except to the extent the liability of such person is found in a final non-appealable judgment by a court of competent jurisdiction to have resulted from such person’s gross negligence or willful misconduct.

(d)Public/Private.  Each Loan Party hereby authorizes the Administrative Agent to distribute (i) to Private Siders all Communications, including any Communication that Borrower identifies in writing is to be distributed to Private Siders only (“Private Side Communications”), and (ii) to Public Siders all Communications other than any Private Side Communication.  Borrower represents and warrants that no Communication (other than Private Side Communications) contains any MNPI.  Borrower agrees to designate as Private Side Communications only those Communications or portions thereof that it reasonably believes in good faith include MNPI.  Holdings and its Subsidiaries do not have any publicly traded securities outstanding as of the date hereof.  At all times thereafter, Borrower agrees to use all commercially reasonably efforts not to designate any Communications provided under Section 5.01(a), (b) and (c) as Private Side Communications.  “Private Siders” shall mean Lenders’ employees and representatives who have declared that they are authorized to receive MNPI.  “Public Siders” shall mean Lenders’ employees and representatives who have not declared that they are authorized to receive MNPI; it being understood that Public Siders may be engaged in investment and other market-related activities with respect to Borrower’s or its affiliates’ securities or loans.  “MNPI” shall mean material non-public information (within the meaning of United States federal securities laws) with respect to Borrower, its affiliates and any of their respective securities.

Each Lender acknowledges that United States federal and state securities laws prohibit any person from purchasing or selling securities on the basis of material, non-public information concerning the issuer of such securities or, subject to certain limited exceptions, from communicating such information to any other person.  Each Lender confirms that it has developed procedures designed to ensure compliance with these securities laws.

Each Lender acknowledges that circumstances may arise that require it to refer to Communications that may contain MNPI.  Accordingly, each Lender agrees that it will use commercially reasonable efforts to designate at least one individual to receive Private Side Communications on its behalf in compliance with its procedures and applicable law and identify such designee (including such designee’s contact information) on such Lender’s Administrative Questionnaire.  Each Lender agrees to notify the Administrative Agent in writing from time to time of such Lender’s designee’s e-mail address to which notice of the availability of Private Side Communications may be sent by electronic transmission.

Each Lender that elects not to be given access to Private Side Communications does so voluntarily and, by such election, (i) acknowledges and agrees that the Agents and other Lenders may have access to Private Side Communications that such electing Lender does not have and

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(ii) takes sole responsibility for the consequences of, and waives any and all claims based on or arising out of, not having access to Private Side Communications.

SECTION 10.02Waivers; Amendment.

(a)Generally.  No failure or delay by any Agent, the Issuing Bank or any Lender in exercising any right or power hereunder or under any other Loan Document shall operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such a right or power, preclude any other or further exercise thereof or the exercise of any other right or power.  The rights and remedies of each Agent, the Issuing Bank and the Lenders hereunder and under the other Loan Documents are cumulative and are not exclusive of any rights or remedies that they would otherwise have.  No waiver of any provision of any Loan Document or consent to any departure by any Loan Party therefrom shall in any event be effective unless the same shall be given in accordance with this Section 10.02, and then such waiver or consent shall be effective only in the specific instance and for the purpose for which given.  Without limiting the generality of the foregoing, the making of a Loan or issuance of a Letter of Credit shall not be construed as a waiver of any Default, regardless of whether any Agent, any Lender or the Issuing Bank may have had notice or knowledge of such Default at the time.  No notice or demand on Borrower in any case shall entitle Borrower to any other or further notice or demand in similar or other circumstances.

(b)Required Consents.  Subject to Section 10.02(c) and (d), neither this Agreement nor any other Loan Document nor any provision hereof or thereof may be waived, amended, supplemented or modified except, in the case of this Agreement, pursuant to an agreement or agreements in writing entered into by Borrower and the Administrative Agent or, in the case of any other Loan Document, pursuant to an agreement or agreements in writing entered into by the Administrative Agent, the Collateral Agent (in the case of any Security Document) and the Loan Party or Loan Parties that are party thereto, in each case with the written consent of the Required Lenders; provided that no such agreement shall be effective if the effect thereof would:

(i)increase the Commitment of any Lender without the written consent of such Lender (it being understood that no amendment, modification, termination, waiver or consent with respect to any condition precedent, covenant or Default shall constitute an increase in the Commitment of any Lender);

(ii)reduce the principal amount of any Loan (except in connection with a payment contemplated by clause (viii) below) or LC Disbursement or reduce the rate of interest thereon (or the amount of any interest payment) including by modification of any provision establishing a minimum rate (other than interest pursuant to Section 2.06(c)), or reduce any Fees payable hereunder, or change the form or currency of payment of any Obligation, without the written consent of the Lender to whom such principal, premium, interest or fee is owed (it being understood that any amendment or modification to the financial definitions in this Agreement shall not constitute a reduction in the rate of interest for purposes of this clause (ii));

(iii)(A) change (x) the scheduled final maturity of any Loan or (y) any scheduled date of payment of any Term Loan under Section 2.09 (or reduce the amount of

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any such payment), (B) postpone the date for payment of any Reimbursement Obligation or any interest, premium or fees payable hereunder or (C) postpone the scheduled date of expiration of any Commitment or any Letter of Credit beyond the Revolving Maturity Date, in any case, without the written consent of the Lender to whom such principal, premium, interest or fee is owed;

(iv)[Reserved];

(v)permit the assignment or delegation by Borrower of any of its rights or obligations under any Loan Document, without the written consent of each Lender;

(vi)release all or substantially all of the value of the Guarantees (except as expressly provided in Article VII), without the written consent of each Lender;

(vii)release all or substantially all of the value of the Collateral from the Liens of the Security Documents without the written consent of each Lender (it being understood that additional Classes of Loans pursuant to Section 2.20 or consented to by the Required Lenders may be equally and ratably secured by the Collateral with the then existing Secured Obligations under the Security Documents);

(viii)change Section 2.14(b), (c) or (d) in a manner that would alter the pro rata sharing of payments or setoffs required thereby or any other provision in a manner that would alter the pro rata allocation among the Lenders of Loan disbursements, including the requirements of Sections 2.02(a), 2.17(d) and 2.18(d), without the written consent of each Lender directly affected thereby; provided that this clause (viii) shall not apply:

(A)to any change made to any of such Sections 2.14(b), (c) or (d) or any such other provision that allows Holdings or any Subsidiary to make payments (as consideration for an assignment, sale or participation or otherwise) on Term B Loans or any Class of Incremental Term Loans without any Loan Party, the payor or the recipient of such payments complying with the pro rata sharing of payments and setoffs required by such Sections or provisions, so long as such change requires that (x) Holdings and its Subsidiaries offer to make such payments to all Term B Loan Lenders or Incremental Term Loan Lenders holding such Class of Incremental Term Loans, as applicable, on a pro rata basis based on the aggregate principal amount of Term B Loans or Incremental Term Loans in such Class, as applicable, then outstanding, (y) such payments are actually allocated to the Term B Loans or Incremental Term Loans in such Class, as applicable, whose holders have elected to make them subject to such offer on a pro rata basis based on the aggregate principal amount of all Term B Loans or Incremental Term Loans in such Class, as applicable, that have been made so subject to such offer and (z) all Term B Loans or Incremental Term Loans in such Class that are paid in any such offer are deemed fully repaid and extinguished for all purposes and may not be reborrowed; or

(B)to any change made to Section 2.14(b) to allow separate treatment thereunder with respect to (1) Extended Term Loans (as defined below) and Term

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B Loans or Incremental Term Loans, as applicable, that are not converted to Extended Term Loans or (2) Extended Revolving Loans (as defined below) and Revolving Loans or Incremental Revolving Loans, as applicable, that are not converted to Extended Revolving Loans; provided that such change is made in connection, and simultaneously, with the creation of a separate Class of term or revolving loans, as applicable, through the conversion of certain existing Term B Loans or Incremental Term Loans (any such Term B Loans or Incremental Term Loans that are so converted, “Extended Term Loans”) or Revolving Loans or Incremental Revolving Loans (any such Revolving Loans or Incremental Revolving Loans that are so converted, “Extended Revolving Loans”) and the modification of Section 2.09 to extend the scheduled maturity date(s) of any payment or payments of principal (including at final maturity), as applicable, with respect to such Extended Term Loans or Extended Revolving Loans, in the case of each change described in this proviso, to the extent otherwise permitted pursuant to this Section 10.02; provided further that (i) Holdings and Borrower offer such conversion to all Term B Loan Lenders or all Incremental Term Loan Lenders holding a particular Class of Incremental Term Loans or to all Revolving Lenders or all Incremental Revolving Loan Lenders holding a particular class of Incremental Revolving Loans, as applicable, on a pro rata basis based on the aggregate principal amount of Term B Loans or Incremental Term Loans or Revolving Loans or Incremental Revolving Loans, as applicable, in such particular Class then outstanding, (ii) the Extended Term Loans shall be identical in all material respects to the existing Term B Loans or Incremental Term Loans in such Class from which such Extended Term Loans are to be converted except that (1) all or any of the scheduled amortization payments of principal and payment at maturity of the Extended Term Loans may be delayed to later dates than the scheduled amortization payments of principal and payment at maturity of the Term B Loans or Incremental Term Loans in such Class from which such Extended Term Loans are to be converted, (2) the Applicable Margins with respect to the Extended Term Loans may be different than the Applicable Margins for the Term B Loans or the Incremental Term Loans in such Class from which such Extended Term Loans are to be converted and upfront fees may be paid to Lenders converting their Term B Loans or Incremental Term Loans in such Class into Extended Term Loans, (3) the available Interest Periods for the Extended Term Loans may be limited, and (4) other covenants and terms may be added (x) that apply solely to any period after the latest final maturity of the Term B Loans and Incremental Term Loans and Commitments in effect immediately prior to the establishment of such Extended Term Loans, or after approval thereof by the Required Lenders or (y) that are less favorable to the holders of the Extended Term Loans than the covenants and terms applicable to the Term B Loans or Incremental Term Loans in such Class from which such Extended Term Loans were converted and (iii) the Extended Revolving Loans shall be identical in all material respects to the existing Revolving Loans or Incremental Revolving Loans in such Class from which such Extended Revolving Loans are to be converted except that (1) the Applicable Margins with respect to the Extended Revolving Loans may be different than the Applicable Margins for the Revolving Loans or the Incremental Revolving Loans in

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such Class from which such Extended Revolving Loans are to be converted and upfront fees may be paid to Lenders converting their Revolving Loans or Incremental Revolving Loans in such Class into Extended Revolving Loans, (2) the available Interest Periods for the Extended Revolving Loans may be limited, and (3) other covenants and terms may be added (x) that apply solely to any period after the latest final maturity of the Revolving Loans and Incremental Revolving Loans and Commitments in effect immediately prior to the establishment of such Extended Revolving Loans, or after approval thereof by the Required Lenders or (y) that are less favorable to the holders of the Extended Revolving Loans than the covenants and terms applicable to the Revolving Loans or Incremental Revolving Loans in such Class from which such Extended Revolving Loans were converted.

(ix)change any provision of this Section 10.02(b) or Section 10.02(c) or (d), without the written consent of each Lender directly affected thereby (except for additional restrictions on amendments or waivers for the benefit of Lenders of additional Classes of Loans pursuant to Section 2.20 or consented to by the Required Lenders);

(x)change the percentage set forth in the definition of “Required Lenders,” “Required Class Lenders,” “Required Revolving Lenders” or any other provision of any Loan Document (including this Section 10.02) specifying the number or percentage of Lenders (or Lenders of any Class) required to waive, amend or modify any rights thereunder or make any determination or grant any consent thereunder, without the written consent of each Lender (or each Lender of such Class, as the case may be), other than to increase such percentage or number or to give any additional Lender or group of Lenders such right to waive, amend or modify or make any such determination or grant any such consent;

(xi)change the application of prepayments as among or between Classes under Section 2.10(g) or 8.02, without the written consent of the Required Class Lenders of each Class that is being allocated a lesser prepayment as a result thereof (it being understood that (x) the Required Lenders may waive, in whole or in part, any prepayment so long as the application, as between Classes, of any portion of such prepayment that is still required to be made is not changed and, (y) if additional Classes of Term Loans under this Agreement pursuant to Section 2.20 or consented to by the Required Lenders are made, such new Term Loans may be included on a pro rata basis in the various prepayments required pursuant to Section 2.10(g), in which case such additional Term Loans may be included in the definition of “Required Class Lenders” in respect of the reference to “each Class of Term Loans,” in each case of this clause (y) without the consent of the Required Lenders or the Required Class Lenders);

(xii)change or waive the application of prepayments of Term B Loans or any Class of Incremental Term Loans set forth in Section 2.10(g) to the remaining scheduled amortization payments to be made thereon under Section 2.09, without the written consent of the Required Class Lenders of such Class;

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(xiii)change or waive any provision of Article X as the same applies to any Agent, or any other provision hereof as the same applies to the rights or obligations of any Agent, in each case without the written consent of such Agent;

(xiv)change or waive any obligation of the Lenders relating to the issuance of or purchase of participations in Letters of Credit or otherwise changing or waiving any of the rights duties of the Issuing Bank, without the written consent of the Administrative Agent and the Issuing Bank;

(xv)change or waive any provision hereof relating to Swingline Loans (including the definition of “Swingline Commitment”), without the written consent of the Swingline Lender; or

(xvi)expressly change or waive any condition precedent in Section 4.02 to any Revolving Borrowing without the written consent of the Required Revolving Lenders.

Notwithstanding anything to the contrary herein:

(I)no Defaulting Lender shall have any right to approve or disapprove any amendment, waiver or consent hereunder, except to the extent the consent of such Lender would be required under clause (i), (ii) or (iii) in the proviso to the first sentence of this Section 10.02(b);

(II)any Loan Document may be waived, amended, supplemented or modified pursuant to an agreement or agreements in writing entered into by Borrower and the Administrative Agent (without the consent of any Lender) solely to cure a defect, error, ambiguity or inconsistency or to grant a new Lien for the benefit of the Secured Parties or extend an existing Lien over additional property; and

(III)this Agreement may be amended as provided in Section 2.20 with the consent of Borrower and the Administrative Agent without the consent of any Lender).

(c)Collateral.  Without the consent of any other person, the applicable Loan Party or Parties and the Administrative Agent and/or Collateral Agent may (in its or their respective sole discretion, or shall, to the extent required by any Loan Document) enter into any amendment or waiver of any Loan Document, or enter into any new agreement or instrument, to effect the granting, perfection, protection, expansion or enhancement of any security interest in any Collateral or additional property to become Collateral for the benefit of the Secured Parties, or as required by local law to give effect to, or protect any security interest for the benefit of the Secured Parties, in any property or so that the security interests therein comply with applicable Requirements of Law.

(d)Dissenting Lenders.  If, in connection with any proposed change, waiver, discharge or termination of the provisions of this Agreement as contemplated by Section 10.02(b), the consent of the Required Lenders is obtained but the consent of one or more of such other Lenders whose consent is required is not obtained, then Borrower shall have the right to replace all, but not less than all, of such non-consenting Lender or Lenders (so long as all non-consenting Lenders are so replaced) with one or more persons pursuant to Section 2.16(b) so long as at the

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time of such replacement each such new Lender consents to the proposed change, waiver, discharge or termination.

(e)           Refinanced Term Loans.  Notwithstanding the foregoing, this Agreement may be amended with the written consent of the Administrative Agent, Holdings, Borrower and the Lenders providing the relevant Replacement Term Loans (as defined below) to permit the refinancing of all outstanding Term Loans (“Refinanced Term Loans”) with a replacement “B” term loan tranche hereunder which shall constitute Term Loans hereunder (“Replacement Term Loans”); provided that (a) the aggregate principal amount of Replacement Term Loans shall not exceed the aggregate principal amount of Refinanced Term Loans, (b) the Applicable Margin for Replacement Term Loans shall not be higher than the Applicable Margin for Refinanced Term Loans, (c) the weighted average life to maturity of Replacement Term Loans shall not be shorter than the weighted average life to maturity of Refinanced Term Loans at the time of such refinancing and (d) all other terms applicable to Replacement Term Loans shall be substantially identical to, or less favorable to the Lenders providing Replacement Term Loans than, those applicable to Refinanced Term Loans, except to the extent necessary to provide for covenants and other terms applicable to any period after the Final Maturity Date in effect immediately prior to such refinancing.

SECTION 10.03      Expenses; Indemnity; Damage Waiver.

(a)           Costs and Expenses.  Borrower shall pay (i) all reasonable and invoiced out-of-pocket expenses incurred by the Administrative Agent, the Collateral Agent and their respective Affiliates (including the reasonable fees, charges and disbursements of one primary counsel and reasonably appropriate local and foreign counsel (retained after consultation with Borrower) for the Administrative Agent and/or the Collateral Agent and reasonable and invoiced expenses incurred in connection with due diligence and travel, courier, reproduction, printing and delivery expenses) in connection with the syndication of the credit facilities provided for herein (including the obtaining and maintaining of CUSIP numbers for the Loans), the preparation, negotiation, execution, delivery and administration of this Agreement and the other Loan Documents or any amendment, amendment and restatement, modification or waiver of the provisions hereof or thereof (whether or not any such amendment, amendment and restatement, modification or waiver is consummated), including in connection with post-closing searches to confirm that security filings and recordations have been properly made and including any costs and expenses of the service provider referred to in Section 9.03, (ii) all reasonable and invoiced out-of-pocket expenses incurred by the Issuing Bank in connection with the issuance, amendment, renewal or extension of any Letter of Credit or any demand for payment thereunder, and (iii) all reasonable and invoiced out-of-pocket expenses incurred by the Administrative Agent, the Collateral Agent, any Lender or the Issuing Bank (including the reasonable fees, charges and disbursements of one counsel for the Administrative Agent, the Collateral Agent, Lenders and the Issuing Bank), in connection with the enforcement or protection of its rights (A) in connection with this Agreement and the other Loan Documents, including its rights under this Section 10.03, or (B) in connection with the Loans made or Letters of Credit issued hereunder, including all such reasonable and invoiced out-of-pocket expenses incurred during any workout, restructuring or negotiations in respect of such Loans or Letters of Credit.

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(b)           Indemnification by Borrower.  Borrower shall indemnify the Administrative Agent (and any sub-agent thereof), the Collateral Agent (and any sub-agent thereof), the Syndication Agent, each Lender and the Issuing Bank, and each Related Party of any of the foregoing persons (each such person being called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and all losses, claims, damages, liabilities and related reasonable out-of-pocket and invoiced expenses (including the reasonable out-of-pocket and invoiced fees, charges and disbursements of one counsel for any Indemnitee, plus local and specialty or regulatory counsel and, in the case of a conflict of interest, an additional counsel to each affected Indemnitee (plus local and specialty or regulatory counsel for such Indemnitee) incurred by any Indemnitee or asserted against any Indemnitee by any party hereto or any third party arising out of, in connection with, or as a result of (i) the execution or delivery of this Agreement, any other Loan Document, or any amendment, amendment and restatement, modification or waiver of the provisions hereof or thereof, or any agreement or instrument contemplated hereby or thereby, the performance by the parties hereto of their respective obligations hereunder or thereunder or the consummation of the transactions contemplated hereby or thereby, (ii) any Loan or Letter of Credit or the use or proposed use of the proceeds therefrom (including any refusal by the Issuing Bank to honor a demand for payment under a Letter of Credit if the documents presented in connection with such demand do not strictly comply with the terms of such Letter of Credit), (iii) any actual or alleged presence or Release or threatened Release of Hazardous Materials on, at, under or from any property owned, leased or operated by any Company at any time, or any Environmental Claim related in any way to any Company, or (iv) any actual or prospective claim, litigation, investigation or proceeding relating to any of the foregoing, whether based on contract, tort or any other theory, whether brought by a third party or by Borrower or any other Loan Party, and regardless of whether any Indemnitee is a party thereto; provided that such indemnity shall not, as to any Indemnitee, be available to the extent that such losses, claims, damages, liabilities or related expenses (x) are determined by a court of competent jurisdiction by final and nonappealable judgment to have resulted from the gross negligence, bad faith or willful misconduct of such Indemnitee, (y) result from a claim brought by Borrower or any other Loan Party against an Indemnitee for material breach of such Indemnitee’s obligations hereunder or under any other Loan Document, if Borrower or such Loan Party has obtained a final and nonappealable judgment in its favor on such claim as determined by a court of competent jurisdiction or (z) arising from any dispute solely among indemnified persons other than any against the Arranger, Administrative Agent or any of their affiliates in its capacity or in fulfilling its role as Administrative Agent or Arranger and other than any claims arising out of any act or omission on the part of Borrower or its Affiliates if Borrower or such Loan Party has obtained a final and nonappealable judgment in its favor on such claim as determined by a court of competent jurisdiction.  For the avoidance of doubt, this Section 10.03(b) shall not apply to Taxes other than Taxes that represent losses, claims, damages, etc. in respect of a non-Tax claim.

(c)           Reimbursement by Lenders.  To the extent that Borrower for any reason fails to indefeasibly pay any amount required under paragraph (a) or (b) of this Section 10.03 to be paid by it to the Administrative Agent (or any sub-agent thereof), the Collateral Agent, the Issuing Bank, the Swingline Lender or any Related Party of any of the foregoing, each Lender severally agrees to pay to the Administrative Agent (or any such sub-agent), the Collateral Agent (or any sub-agent thereof), the Issuing Bank, the Swingline Lender or such Related Party, as the case may be, such Lender’s pro rata share (determined as of the time that the applicable unreimbursed expense or indemnity payment is sought) of such unpaid amount (such indemnity shall be

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effective whether or not the related losses, claims, damages, liabilities and related expenses are incurred or asserted by any party hereto or any third party); provided that (i) the unreimbursed expense or indemnified loss, claim, damage, liability or related expense, as the case may be, was incurred by or asserted against the Administrative Agent (or any such sub-agent), the Collateral Agent (or any sub-agent thereof), the Swingline Lender or the Issuing Bank in its capacity as such, or against any Related Party of any of the foregoing acting for the Administrative Agent (or any such sub-agent), the Collateral Agent (or any sub-agent thereof), the Swingline Lender or Issuing Bank in connection with such capacity and (ii) such indemnity for the Swingline Lender or the Issuing Bank shall not include losses incurred by the Swingline Lender or the Issuing Bank due to one or more Lenders defaulting in their obligations to purchase participations of Swingline Exposure under Section 2.17(d) or LC Exposure under Section 2.18(d) or to make Revolving Loans under Section 2.18(e) (it being understood that this proviso shall not affect the Swingline Lender’s or the Issuing Bank’s rights against any Defaulting Lender).  The obligations of the Lenders under this paragraph (c) are subject to the provisions of Section 2.14.  For purposes hereof, a Lender’s “pro rata share” shall be determined based upon its share of the sum of the total Revolving Exposure, outstanding Term Loans and unused Commitments at the time.

(d)           Waiver of Consequential Damages, Etc.  To the fullest extent permitted by applicable Requirements of Law (but not in derogation of any indemnification obligations set forth in Section 10.03(b)), no party hereto shall assert, and each party hereto hereby waives, any claim against any other party hereto, on any theory of liability, for special, indirect, consequential or punitive damages (as opposed to direct or actual damages) arising out of, in connection with, or as a result of, this Agreement, any other Loan Document or any agreement or instrument contemplated hereby, the transactions contemplated hereby or thereby, any Loan or Letter of Credit or the use of the proceeds thereof.  No Indemnitee referred to in paragraph (b) above shall be liable for any damages arising from the use by unintended recipients of any information or other materials distributed by it through telecommunications, electronic or other information transmission systems in connection with this Agreement or the other Loan Documents or the transactions contemplated hereby or thereby, except to the extent such damages are caused by the gross negligence or willful misconduct of such Indemnitee.

(e)           Payments.  All amounts due under this Section 10.03 shall be payable not later than ten Business Days after demand therefor.

SECTION 10.04      Successors and Assigns.

(a)           Successors and Assigns Generally.  The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and assigns permitted hereby, except that Borrower may not assign or otherwise transfer any of its rights or obligations hereunder without the prior written consent of the Administrative Agent, the Collateral Agent, the Issuing Lender, the Swingline Lender and each Lender (and any other attempted assignment or transfer by Borrower shall be null and void) and no Lender may assign or otherwise transfer any of its rights or obligations hereunder except (i) to an Eligible Assignee in accordance with the provisions of Section 10.04(b), (ii) by way of participation in accordance with the provisions of Section 10.04(d) or (iii) by way of pledge or assignment of a security interest subject to the restrictions of Section 10.04(f) (and any other attempted assignment or transfer by Lender shall be null and void).  Nothing in this Agreement, expressed or implied, shall be

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construed to confer upon any person (other than the parties hereto, their respective successors and assigns permitted hereby, Participants to the extent provided in Section 10.04(d) and, to the extent expressly contemplated hereby, the other Indemnitees) any legal or equitable right, remedy or claim under or by reason of this Agreement.

(b)           Assignments by Lenders.

(i)            Subject to the conditions set forth in paragraph (b)(ii) below, any Lender may at any time assign to one or more assignees all or a portion of its rights and obligations under this Agreement (including all or a portion of its Commitment and the Loans at the time owing to it) with the prior written consent (such consent not to be unreasonably withheld) of:

(A)          Borrower; provided that no consent of Borrower shall be required for an assignment to a Lender, an Affiliate of a Lender, an Approved Fund or, if an Event of Default under Sections 8.01(a), (b), (g) or (h) has occurred and is continuing or prior to the completion of the primary syndication of the Commitments and Loans (as determined by the Arranger), any other assignee; provided further that when required, Borrower’s consent shall be deemed to have been given unless Borrower objects to such assignment within five Business Days after receiving notice of such assignment;

(B)           the Administrative Agent; provided that no consent of the Administrative Agent shall be required for an assignment of (x) any Revolving Commitment to an assignee that is a Lender with a Revolving Commitment immediately prior to giving effect to such assignment or (y) all or any portion of a Term Loan to a Lender, an Affiliate of a Lender or an Approved Fund; and

(C)           the Issuing Bank and the Swingline Lender; provided that no consent of the Issuing Bank or the Swingline Lender shall be required for an assignment of all or any portion of a Term Loan.

(ii)           Assignments shall be subject to the following additional conditions:

(A)          except in the case of any assignment made in connection with the primary syndication of the Commitment and Loans by the Arranger or an assignment of the entire remaining amount of the assigning Lender’s Commitment and the Loans at the time owing to it or in the case of an assignment to a Lender or an Affiliate of a Lender or an Approved Fund with respect to a Lender, the aggregate amount of the Commitment (which for this purpose includes Loans outstanding thereunder) or, if the applicable Commitment is not then in effect, the principal outstanding balance of the Loans of the assigning Lender subject to each such assignment (determined as of the date the Assignment and Assumption with respect to such assignment is delivered to the Administrative Agent or, if “Trade Date” is specified in the Assignment and Assumption, as of the Trade Date) shall not be less than $5,000,000, in the case of any assignment in respect of Revolving Loans and/or Revolving Commitments, or $1,000,000, in the case of any assignment in respect of Term Loans and/or Term Loan Commitments, unless each of the Administrative Agent and, so long as no Default has occurred and is continuing, Borrower otherwise consent (each such consent not to be unreasonably withheld or delayed);

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(B)           each partial assignment shall be made as an assignment of a proportionate part of all the assigning Lender’s rights and obligations under this Agreement with respect to the Loan or the Commitment assigned; except that this clause (ii) shall not prohibit any Lender from assigning all or a portion of its rights and obligations among separate tranches on a non-pro rata basis; and

(C)           the parties to each assignment shall execute and deliver to the Administrative Agent an Assignment and Assumption, together with a processing and recordation fee of $3,500 (unless such fee is waived or reduced by the Administrative Agent (acting in its sole discretion)); provided that if an assignment by a Lender is made to an assignee(s) that are not Related Funds of such assignor Lender, but is concurrently made to one or more Related Funds of such assignee, then only one assignment fee of $3,500 shall be due in connection with such assignment, and the each such assignee, if it shall not be a Lender, shall deliver to the Administrative Agent an Administrative Questionnaire; and

(D)          in no event shall any Lender assign any of its rights and obligations under this Agreement to a Disqualified Institution.

Subject to acceptance and recording thereof by the Administrative Agent pursuant to Section 10.04(c), from and after the effective date specified in each Assignment and Assumption, the Eligible Assignee thereunder shall be a party to this Agreement and, to the extent of the interest assigned by such Assignment and Assumption, have the rights and obligations of a Lender under this Agreement, and the assigning Lender thereunder shall, to the extent of the interest assigned by such Assignment and Assumption, be released from its obligations under this Agreement (and, in the case of an Assignment and Assumption covering all of the assigning Lender’s rights and obligations under this Agreement, such Lender shall cease to be a party hereto) but shall continue to be entitled to the benefits of and be subject to the obligations under Sections 2.12, 2.13, 2.15 and 10.03 with respect to facts and circumstances occurring prior to the effective date of such assignment.  Any assignment or transfer by a Lender of rights or obligations under this Agreement that does not comply with this paragraph shall be treated for purposes of this Agreement as a sale by such Lender of a participation in such rights and obligations in accordance with Section 10.04(d).

(c)           Register.  The Administrative Agent, acting solely for this purpose as an agent of Borrower, shall maintain a copy of each Assignment and Assumption delivered to it and a register for the recordation of the names and addresses of the Lenders, and the Commitments of, and principal amounts (and stated interest) of the Loans and LC Disbursements owing to, each Lender pursuant to the terms hereof from time to time (the “Register”).  The entries in the Register shall be conclusive (absent manifest error), and Borrower, the Administrative Agent, the Issuing Bank and the Lenders shall treat each person whose name is recorded in the Register pursuant to the terms hereof as a Lender hereunder for all purposes of this Agreement, notwithstanding notice to the contrary.  The Register shall be available for inspection by Borrower, the Issuing Bank (with respect to Revolving Lenders only), the Collateral Agent, the Swingline Lender (with respect to Revolving Lenders only) and any Lender (with respect to its own interest only), at any reasonable time and from time to time upon reasonable prior notice.  The requirements of this Section 10.04(c) are intended to result in any and all Loans and LC Disbursements being in

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“registered” form for purposes of Section 871, Section 881 and any other applicable provision of the Code, and shall be interpreted and applied in a manner consistent therewith.

(d)           Participations Any Lender may at any time, without the consent of, or notice to, Borrower, the Administrative Agent, the Issuing Bank or the Swingline Lender sell participations to any person (other than a natural person or Borrower or any of its Affiliates) (each, a “Participant”) in all or a portion of such Lender’s rights and/or obligations under this Agreement (including all or a portion of its Commitment and/or the Loans owing to it); provided that (i) such Lender’s obligations under this Agreement shall remain unchanged, (ii) such Lender shall remain solely responsible to the other parties hereto for the performance of such obligations and (iii) Borrower, the Administrative Agent and the Lenders and Issuing Bank shall continue to deal solely and directly with such Lender in connection with such Lender’s rights and obligations under this Agreement.

Any agreement or instrument pursuant to which a Lender sells such a participation shall provide that such Lender shall retain the sole right to enforce the Loan Documents and to approve any amendment, modification or waiver of any provision of the Loan Documents; provided that such agreement or instrument may provide that such Lender will not, without the consent of the Participant, agree to any amendment, modification or waiver described in clause (i), (ii) or (iii) of the first proviso to Section 10.02(b) that affects such Participant.  Subject to Section 10.04(e), Borrower agrees that each Participant shall be entitled to the benefits of Sections 2.12, 2.13 and 2.15 (subject to the limitations and requirements of those Sections and Section 2.16 as though such Participant were a Lender) to the same extent as if it were a Lender and had acquired its interest by assignment pursuant to Section 10.04(b).  To the extent permitted by law, each Participant also shall be entitled to the benefits of Section 10.08 as though it were a Lender; provided such Participant agrees to be subject to Section 2.14 as though it were a Lender.

Each Lender that sells a participation shall, acting solely for this purpose as an agent of Borrower, maintain a register on which it enters the name and address of each Participant and the principal amounts (and stated interest) of each participant’s interest in the Loans or other obligations under this Agreement (the “Participant Register”).  The entries in the Participant Register shall be conclusive absent manifest error, and such Lender shall treat each person whose name is recorded in the Participant Register as the owner of such participation for all purposes of this Agreement notwithstanding any notice to the contrary.

(e)           Limitations on Participant Rights.  A Participant shall not be entitled to receive any greater payment under Sections 2.12, 2.13 and 2.15 than the applicable Lender would have been entitled to receive with respect to the participation sold to such Participant, unless the sale of the participation to such Participant is made with Borrower’s prior written consent (not to be unreasonably withheld or delayed), or except to the extent such entitlement to a greater payment results from a change in any Requirement of Law after the Participant became a Participant.

(f)            Certain Pledges.  Any Lender may at any time pledge or assign a security interest in all or any portion of its rights under this Agreement to secure obligations of such Lender, including any pledge or assignment to secure obligations to a Federal Reserve Bank; provided that no such pledge or assignment shall release such Lender from any of its obligations hereunder or

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substitute any such pledgee or assignee for such Lender as a party hereto.  In the case of any Lender that is a fund that invests in bank loans, such Lender may, without the consent of Borrower or the Administrative Agent, collaterally assign or pledge all or any portion of its rights under this Agreement, including the Loans and Notes or any other instrument evidencing its rights as a Lender under this Agreement, to any holder of, trustee for, or any other representative of holders of, obligations owed or securities issued, by such fund, as security for such obligations or securities.

(g)           Electronic Execution of Assignments.  The words “execution,” “signed,” “signature,” and words of like import in any Assignment and Assumption shall be deemed to include electronic signatures or the keeping of records in electronic form, each of which shall be of the same legal effect, validity or enforceability as a manually executed signature or the use of a paper-based recordkeeping system, as the case may be, to the extent and as provided for in any applicable Requirement of Law, including the Federal Electronic Signatures in Global and National Commerce Act, the New York State Electronic Signatures and Records Act, or any other similar state laws based on the Uniform Electronic Transactions Act.

(h)           Restrictions on Affiliated Lenders.  Notwithstanding any provision of this Agreement to the contrary:  (i) Affiliated Lenders shall not be entitled to receive any material prepared by an Agent or another Lender solely for distribution to the Lenders and/or the Agents, or to participate in any meetings of Lenders and/or Agents or telephone conferences among Lenders and/or Agents at which one or more of the Companies or their representatives are not also present; (ii) an Affiliated Lender may not be an assignee of Revolving Loans or Revolving Commitments; (iii) Affiliated Lenders may not hold in the aggregate more than 20% of the outstanding principal amount of the Term Loans or Term Loan Commitments; and (iv) for the purposes of any amendment, waiver or modification of the Loan Documents, and for purposes of any exercise of any right or remedy under the Loan Documents (or any vote of the Lenders in connection with any proceeding referred to in Section 8.01(g) or (h) that does not adversely affect such Affiliated Lender (solely in its capacity as a Lender) in any material respect as compared to other Lenders), such Affiliated Lender will be deemed to have voted in the same proportion as the other Lenders voting on such matter (or if all other Lenders shall have approved such amendment, waiver or modification, shall be deemed to have approved the same).  In addition, to purchasing Term Loans pursuant to this Section 10.04, Affiliated Lenders may purchase Term Loans pursuant to an auction open to all Term Loan Lenders pursuant to customary procedures agreed between Borrower and the Administrative Agent but any such auction shall still be subject to the restrictions contained in this Section 10.04(h).

SECTION 10.05      Survival of Agreement.

All covenants, agreements, representations and warranties made by the Loan Parties in the Loan Documents and in the certificates or other instruments delivered in connection with or pursuant to this Agreement or any other Loan Document shall be considered to have been relied upon by the other parties hereto and shall survive the execution and delivery of the Loan Documents and the making of any Loans and issuance of any Letters of Credit, regardless of any investigation made by any such other party or on its behalf and notwithstanding that the Agents, the Issuing Bank or any Lender may have had notice or knowledge of any Default or incorrect representation or warranty at the time any credit is extended hereunder, and shall continue in full

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force and effect as long as the principal of or any accrued interest on any Loan or any fee or any other amount payable under this Agreement is outstanding and unpaid or any Letter of Credit is outstanding and so long as the Commitments have not expired or terminated.  The provisions of Sections 2.12, 2.14, 2.15 and Article X (other than Section 10.12) shall survive and remain in full force and effect regardless of the consummation of the transactions contemplated hereby, the repayment of the Loans, the payment of the Reimbursement Obligations, the expiration or termination of the Letters of Credit and the Commitments or the termination of this Agreement or any provision hereof.

SECTION 10.06      Counterparts; Integration; Effectiveness.

This Agreement may be executed in counterparts (and by different parties hereto in different counterparts), each of which shall constitute an original, but all of which when taken together shall constitute a single contract.  This Agreement and the other Loan Documents, any separate letter agreements with respect to fees payable to the Administrative Agent, the provisions under the headings “Syndication”, “Conflicts of Interest” and “Clear Market” in the Commitment Letter and the provisions under the heading “Market Flex” in the Fee Letter constitute the entire contract among the parties relating to the subject matter hereof and supersede any and all previous agreements and understandings, oral or written, relating to the subject matter hereof.  Except as provided in Section 4.01, this Agreement shall become effective when it shall have been executed by the Administrative Agent and when the Administrative Agent shall have received counterparts hereof that, when taken together, bear the signatures of each of the other parties hereto.  Delivery of an executed counterpart of a signature page of this Agreement by facsimile or other electronic transmission (i.e. a “pdf” or “tif” document) shall be effective as delivery of a manually executed counterpart of this Agreement.

SECTION 10.07      Severability.

Any provision of this Agreement held to be invalid, illegal or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity, illegality or unenforceability without affecting the validity, legality and enforceability of the remaining provisions hereof; and the invalidity of a particular provision in a particular jurisdiction shall not invalidate such provision in any other jurisdiction.

SECTION 10.08      Right of Setoff.

If an Event of Default shall have occurred and be continuing, each Lender (other than a Defaulting Lender), the Issuing Bank, and each of their respective Affiliates is hereby authorized at any time and from time to time, to the fullest extent permitted by applicable Requirements of Law, to (i) exercise any rights and remedies pursuant to any California Mortgage with respect to Account Collateral (as defined in such California Mortgage) including by exercise of remedies pursuant to Section 2.5 of such California Mortgage and (ii) set off and apply any and all deposits (general or special, time or demand, provisional or final, in whatever currency) at any time held and other obligations (in whatever currency) at any time owing by such Lender, the Issuing Bank or any such Affiliate to or for the credit or the account of Borrower or any other Loan Party (other than a Loan Party that has granted a California Mortgage) against any and all of the obligations of Borrower or such Loan Party (other than a Loan Party that has granted a California

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Mortgage) now or hereafter existing under this Agreement or any other Loan Document to such Lender or the Issuing Bank, irrespective of whether or not such Lender or the Issuing Bank shall have made any demand under this Agreement or any other Loan Document and although such obligations of Borrower or such Loan Party may be contingent or unmatured or are owed to a branch or office of such Lender or the Issuing Bank different from the branch or office holding such deposit or obligated on such indebtedness.  The rights of each Lender, the Issuing Bank and their respective Affiliates under this Section are in addition to other rights and remedies (including other rights of setoff and the rights provided to the Lender pursuant to Section 2.5 of each California Mortgage with respect to the Account Collateral described therein) that such Lender, the Issuing Bank or their respective Affiliates may have.  Each Lender and the Issuing Bank agrees to notify Borrower and the Administrative Agent promptly after (i) exercising any rights or remedies with respect to Account Collateral pursuant to a California Mortgage and (ii) any such setoff and application; provided that the failure to give such notice shall not affect the validity of such setoff and application.  Notwithstanding anything to the contrary contained in this Section 10.08 or otherwise contained in this Agreement, without the prior written consent of Administrative Agent, neither the Issuing Bank, any Lender nor any Affiliate of any of them may setoff any deposits or other obligations owing by such Lender, the Issuing Bank or any such Affiliate against any obligations owing by a Loan Party that has granted a California Mortgage.

SECTION 10.09      Governing Law; Jurisdiction; Consent to Service of Process.

(a)           Governing Law.  This Agreement and the transactions contemplated hereby, and all disputes between the parties under or relating to this Agreement or the facts or circumstances leading to its execution, whether in contract, tort or otherwise, shall be construed in accordance with and governed by the laws (including statutes of limitation) of the State of New York, without regard to conflicts of law principles that would require the application of the laws of another jurisdiction; provided that matters related to alleged Business Material Adverse Effect or exception thereto shall be governed by and construed in accordance with the laws of the State of Delaware, without regard to conflicts of law principles that would require the applicable of the laws of another jurisdiction.

(b)           Submission to Jurisdiction.  Each party hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of the Supreme Court of the State of New York sitting in New York County and of the United States District Court of the Southern District of New York, and any appellate court from any thereof, in any action or proceeding arising out of or relating to any Loan Document, or for recognition or enforcement of any judgment, and each of the parties hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in such New York State court or, to the fullest extent permitted by applicable law, in such Federal court.  Each of the parties hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law.  Nothing in this Agreement or any other Loan Document shall affect any right that the Administrative Agent, the Issuing Bank or any Lender may otherwise have to bring any action or proceeding relating to this Agreement or any other Loan Document against any Loan Party or its properties in the courts of any jurisdiction.

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(c)           Venue.  Each party hereby irrevocably and unconditionally waives, to the fullest extent permitted by applicable Requirements of Law, any objection which it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to this Agreement or any other Loan Document in any court referred to in Section 10.09(b).  Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted by applicable Requirements of Law, the defense of an inconvenient forum to the maintenance of such action or proceeding in any such court.

(d)           Service of Process.  Each party hereto irrevocably consents to service of process in any action or proceeding arising out of or relating to any Loan Document, in the manner provided for notices (other than facsimile) in Section 10.01.  Nothing in this Agreement or any other Loan Document will affect the right of any party hereto to serve process in any other manner permitted by applicable Requirements of Law.

SECTION 10.10      Waiver of Jury Trial.

Each party hereby waives, to the fullest extent permitted by applicable Requirements of Law, any right it may have to a trial by jury in any legal proceeding directly or indirectly arising out of or relating to this Agreement, any other Loan Document or the transactions contemplated hereby (whether based on contract, tort or any other theory).  Each party hereto (a) certifies that no representative, agent or attorney of any other party has represented, expressly or otherwise, that such other party would not, in the event of litigation, seek to enforce the foregoing waiver and (b) acknowledges that it and the other parties hereto have been induced to enter into this Agreement by, among other things, the mutual waivers and certifications in this Section.

SECTION 10.11      Headings.

Article and Section headings and the Table of Contents used herein are for convenience of reference only, are not part of this Agreement and shall not affect the construction of, or be taken into consideration in interpreting, this Agreement.  Unless otherwise specified, to the extent a notice, payment or other action is required by the terms hereof to be delivered or made on a day which is not a Business Day, such action shall be deemed to have been taken on such day as long as the action is taken on the next succeeding Business Day

SECTION 10.12      Treatment of Certain Information; Confidentiality.

Each of the Administrative Agent, the Lenders and the Issuing Bank agrees to maintain the confidentiality of the Information (as defined below), except that Information may be disclosed (a) to its Affiliates and to its and its Affiliates’ respective partners, directors, officers, employees, agents, advisors and other representatives (it being understood that the persons to whom such disclosure is made will be informed of the confidential nature of such Information and instructed to keep such Information confidential), (b) to the extent requested by any Governmental Authority or regulatory authority (including any self-regulatory authority, such as the National Association of Insurance Commissioners) (in which case the Administrative Agent, the Lenders or the Issuing Bank, as applicable, shall, to the extent permitted by applicable Requirements of Law and except with respect to any audit or examination conducted by bank accountants or any government bank authority exercising examination or regulatory authority, inform Borrower

164

promptly of such disclosure), (c) to the extent required by applicable Requirements of Law or by any subpoena or similar legal process, (d) in connection with the exercise of any remedies hereunder or under any other Loan Document or any action or proceeding relating to this Agreement or any other Loan Document or the enforcement of rights hereunder or thereunder, (e) subject to an agreement containing provisions substantially the same as those of this Section 10.12, to (i) any assignee of or Participant in, or any prospective assignee of or Participant in, any of its rights or obligations under this Agreement, (ii) any actual or prospective counterparty (or its advisors) to any swap or derivative transaction relating to Borrower and its obligations or (iii) any rating agency for the purpose of obtaining a credit rating applicable to any Lender, (f) with the consent of Borrower or (g) to the extent such Information (x) becomes publicly available other than as a result of a breach of this Section or (y) becomes available to the Administrative Agent, any Lender, the Issuing Bank or any of their respective Affiliates on a nonconfidential basis from a source other than Borrower.  For purposes of this Section 10.12, “Information” means all information received from Borrower or any of its Subsidiaries relating to Borrower or any of its Subsidiaries or any of their respective businesses; provided that, in the case of information received from Borrower or any of its Subsidiaries after the date hereof, such information is clearly identified at the time of delivery as confidential.  Any person required to maintain the confidentiality of Information as provided in this Section 10.12 shall be considered to have complied with its obligation to do so if such person has exercised the same degree of care to maintain the confidentiality of such Information as such person would accord to its own confidential information.

SECTION 10.13      USA PATRIOT Act Notice and Customer Verification.

Each Lender that is subject to the USA PATRIOT Act and the Administrative Agent (for itself and not on behalf of any Lender) hereby notify Borrower that pursuant to the “know your customer” regulations and the requirements of the USA PATRIOT Act, they are required to obtain, verify and record information that identifies each Loan Party, which information includes the name, address and tax identification number (and other identifying information in the event this information is insufficient to complete verification) that will allow such Lender or the Administrative Agent, as applicable, to verify the identity of each Loan Party in accordance with the USA PATRIOT Act.  This information must be delivered to the Lenders and the Administrative Agent no later than five days prior to the Closing Date and thereafter promptly upon request.  This notice is given in accordance with the requirements of the USA PATRIOT Act and is effective as to the Lenders and the Administrative Agent.

SECTION 10.14      Interest Rate Limitation.

Notwithstanding anything herein to the contrary, if at any time the interest rate applicable to any Loan, together with all fees, charges and other amounts which are treated as interest on such Loan under applicable Requirements of 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 Lender holding such Loan in accordance with applicable Requirements of Law, the rate of interest payable in respect of such Loan hereunder, 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 such Loan but were not payable as a result of the operation of this Section 10.14 shall be cumulated and the interest and Charges payable to such Lender in respect of other Loans or periods shall be increased (but not above the

165

Maximum Rate therefor) until such cumulated amount, together with interest thereon at the Federal Funds Effective Rate to the date of repayment, shall have been received by such Lender.

SECTION 10.15      Lender Addendum.

Each Lender to become a party to this Agreement on the date hereof shall do so by delivering to the Administrative Agent a Lender Addendum duly executed by such Lender, Borrower and the Administrative Agent.

SECTION 10.16      Obligations Absolute.

To the fullest extent permitted by applicable Requirements of Law, all obligations of the Loan Parties hereunder shall be absolute and unconditional irrespective of:

(a)           any bankruptcy, insolvency, reorganization, arrangement, readjustment, composition, liquidation or the like of any Loan Party;

(b)           any lack of validity or enforceability of any Loan Document or any other agreement or instrument relating thereto against any Loan Party;

(c)           any change in the time, manner or place of payment of, or in any other term of, all or any of the Obligations, or any other amendment or waiver of or any consent to any departure from any Loan Document or any other agreement or instrument relating thereto;

(d)           any exchange, release or non-perfection of any other Collateral, or any release or amendment or waiver of or consent to any departure from any guarantee, for all or any of the Obligations;

(e)           any exercise or non-exercise, or any waiver of any right, remedy, power or privilege under or in respect hereof or any Loan Document; or

(f)            any other circumstances which might otherwise constitute a defense available to, or a discharge of, the Loan Parties.

[Signature Pages Follow]

166

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

CPI INTERNATIONAL ACQUISITION, INC.
By:	/s/ Joel A. Littman
	Name: Joel A. Littman
	Title: Chief Financial Officer, Treasurer and Secretary
CPI INTERNATIONAL HOLDING CORP.
By:	/s/ Joel A. Littman
	Name: Joel A. Littman
	Title: Chief Financial Officer, Treasurer and Secretary
COMMUNICATIONS & POWER INDUSTRIES LLC
By:	/s/ Joel A. Littman
	Name: Joel A. Littman
	Title: Chief Financial Officer, Treasurer and Secretary
CPI ECONCO DIVISION
By:	/s/ Joel A. Littman
	Name: Joel A. Littman
	Title: Secretary and Treasurer

CPI MALIBU DIVISION
By:	/s/ Joel A. Littman
	Name: Joel A. Littman
	Title: Secretary and Chief Financial Officer
CPI SUBSIDIARY HOLDINGS LLC
By:	/s/ Joel A. Littman
	Name: Joel A. Littman
	Title: Secretary
COMMUNICATIONS & POWER INDUSTRIES INTERNATIONAL INC.
By:	/s/ Joel A. Littman
	Name: Joel A. Littman
	Title: Secretary
COMMUNICATIONS & POWER INDUSTRIES ASIA INC.
By:	/s/ Joel A. Littman
	Name: Joel A. Littman
	Title: Secretary and Treasurer

UBS SECURITIES LLC, as Arranger and Bookrunner
By:	/s/ Mary E. Evans
	Name: Mary E. Evans
	Title: Attorney-in-Fact
By:	/s/ Irja R. Otsa
	Name: Irja R. Otsa
	Title: Associate Director, Banking Products Services. US
UBS AG, STAMFORD BRANCH, as Issuing Bank, Administrative Agent and Collateral Agent
By:	/s/ Mary E. Evans
	Name: Mary E. Evans
	Title: Associate Director, Banking Products Services. US
By:	/s/ Irja R. Otsa
	Name: Irja R. Otsa
	Title: Associate Director, Banking Products Services. US
UBS LOAN FINANCE LLC, as Swingline Lender and a Lender
By:	/s/ Mary E. Evans
	Name: Mary E. Evans
	Title: Associate Director, Banking Products Services. US
By:	/s/ Irja R. Otsa
	Name: Irja R. Otsa
	Title: Associate Director, Banking Products Services. US

Annex I

Amortization Table

	Term B Loan
Date	Amount
March 31, 2011	$	375,000
June 30, 2011	$	375,000
September 30, 2011	$	375,000
December 31, 2011	$	375,000
March 31, 2012	$	375,000
June 30, 2012	$	375,000
September 30, 2012	$	375,000
December 31, 2012	$	375,000
March 31, 2013	$	375,000
June 30, 2013	$	375,000
September 30, 2013	$	375,000
December 31, 2013	$	375,000
March 31, 2014	$	375,000
June 30, 2014	$	375,000
September 30, 2014	$	375,000
December 31, 2014	$	375,000
March 31, 2015	$	375,000
June 30, 2015	$	375,000
September 30, 2015	$	375,000
December 31, 2015	$	375,000
March 31, 2016	$	375,000
June 30, 2016	$	375,000
September 30, 2016	$	375,000
December 31, 2016	$	375,000
Term B Loan Maturity Date	$	141,000,000

EXHIBIT A

[Form of]

ADMINISTRATIVE QUESTIONNAIRE

CPI INTERNATIONAL ACQUISITION, INC. (f/k/a CATALYST HOLDINGS, INC.)(1)

Agent Address:	UBS AG, Stamford Branch	Attn: Banking Products Services Agency
	677 Washington Boulevard	Telephone: (203) 719-3158
	Stamford, Connecticut 06901	Facsimile: (203) 719-3180
		E-mail: DL-UBSAgency@ubs.com

It is very important that all of the requested information be completed accurately and that this questionnaire be returned promptly.  If your institution is sub-allocating its allocation, please fill out an administrative questionnaire for each legal entity.

Legal Name of Lender to appear in Documentation:
Signature Block Information:
	·	Signing Credit Agreement	Yes	No
	·	Coming in via Assignment	Yes	No

Type of Lender:

(Bank, Asset Manager, Broker/Dealer, CLO/CDO; Finance Company, Hedge Fund, Insurance, Mutual Fund, Pension Fund, Other Regulated Investment Fund, Special Purpose Vehicle, Other please specify)

Lender Parent:

(1) Is the Borrower to be renamed after closing necessitating a change to the lead-in in the Credit Agreement?

A-1

Domestic Address Eurodollar Address

A-2

Contacts/Notification Methods:  Borrowings, Paydowns, Interest, Fees, etc.

	Primary Credit Contact	Secondary Credit Contact
Name:
Company:
Title:
Address:
Telephone:
Facsimile:
E-Mail Address:
	Primary Operations Contact	Secondary Operations Contact
Name:
Company:
Title:
Address:
Telephone:
Facsimile:
E-Mail Address:
	Bid Contact	L/C Contact
Name:
Company:
Title:
Address:
Telephone:
Facsimile:
E-Mail Address:

A-3

Lender’s Domestic Wire Instructions

Bank Name:

ABA/Routing No.:

Account Name:

Account No.:

FFC Account Name:

FFC Account No.:

Attention:

Reference:

Lender’s Foreign Wire Instructions

Currency:

Bank Name:

Swift/Routing No.:

Account Name:

Account No.:

FFC Account Name:

FFC Account No.:

Attention:

Reference:

Agent’s Wire Instructions

[The Agent’s wire instructions will be disclosed at the time of closing.]

Bank Name:

ABA/Routing No.:

Account Name:

Account No.:

FFC Account Name:

FFC Account No.:

Attention:

Reference:

A-4

Tax Documents

NON-U.S. LENDER INSTITUTIONS:

I.              Corporations:

If your institution is incorporated outside of the United States for U.S. federal income tax purposes, and is the beneficial owner of the interest and other income it receives, you must complete one of the following three tax forms, as applicable to your institution:  a.) Form W-8BEN (Certificate of Foreign Status of Beneficial Owner), b.) Form W-8ECI (Income Effectively Connected to a U.S. Trade or Business), or c.) Form W-8EXP (Certificate of Foreign Government or Governmental Agency).

A U.S. taxpayer identification number is required for any institution submitting Form W-8ECI.  It is also required on Form W-8BEN for certain institutions claiming the benefits of a tax treaty with the U.S.  Please refer to the instructions when completing the form applicable to your institution.  In addition, please be advised that U.S. tax regulations do not permit the acceptance of faxed forms.  An original tax form must be submitted.

II.            Flow-Through Entities:

If your institution is organized outside the U.S., and is classified for U.S. federal income tax purposes as either a Partnership, Trust, Qualified or Non-Qualified Intermediary, or other non-U.S. flow-through entity, an original Form W-8IMY (Certificate of Foreign Intermediary, Foreign Flow-Through Entity, or Certain U.S. Branches for United States Tax Withholding) must be completed by the intermediary together with a withholding statement.  Flow-through entities other than Qualified Intermediaries are required to include tax forms for each of the underlying beneficial owners.

Please refer to the instructions when completing this form.  In addition, please be advised that U.S. tax regulations do not permit the acceptance of faxed forms.  Original tax form(s) must be submitted.

U.S. LENDER INSTITUTIONS:

If your institution is incorporated or organized within the United States, you must complete and return Form W-9 (Request for Taxpayer Identification Number and Certification).  Please be advised that we request that you submit an original Form W-9.

Pursuant to the language contained in the tax section of the Credit Agreement, the applicable tax form for your institution must be completed and returned prior to the first payment of income.  Failure to provide the proper tax form when requested may subject your institution to U.S. tax withholding.

A-5

EXHIBIT B

[Form of]
ASSIGNMENT AND ASSUMPTION

This Assignment and Assumption (the “Assignment and Assumption”) is dated as of the Effective Date set forth below and is entered into by and between [Insert name of Assignor] (the “Assignor”) and [Insert name of Assignee] (the “Assignee”).  Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement defined below, receipt of a copy of which is hereby acknowledged by the Assignee.  The Standard Terms and Conditions set forth in Annex 1 attached hereto are hereby agreed to and incorporated herein by reference and made a part of this Assignment and Assumption as if set forth herein in full.

For an agreed consideration, the Assignor hereby irrevocably sells and assigns to the Assignee, and the Assignee hereby irrevocably purchases and assumes from the Assignor, subject to and in accordance with the Standard Terms and Conditions and the Credit Agreement, as of the Effective Date inserted by the Administrative Agent as contemplated below, (i) all of the Assignor’s rights and obligations in its capacity as a Lender under the Credit Agreement and any other documents or instruments delivered pursuant thereto to the extent related to the amount and percentage interest identified below of all of such outstanding rights and obligations of the Assignor under the respective facilities identified below (including participations in any Letters of Credit and Swingline Loans included in such facilities) and (ii) to the extent permitted to be assigned under applicable law, all claims, suits, causes of action and any other right of the Assignor (in its capacity as a Lender) against any person, whether known or unknown, arising under or in connection with the Credit Agreement, any other documents or instruments delivered pursuant thereto or the loan transactions governed thereby or in any way based on or related to any of the foregoing, including, but not limited to, contract claims, tort claims, malpractice claims, statutory claims and all other claims at law or in equity related to the rights and obligations sold and assigned pursuant to clause (i) above (the rights and obligations sold and assigned pursuant to clauses (i) and (ii) above being referred to herein collectively as, the “Assigned Interest”).  Such sale and assignment is without recourse to the Assignor and, except as expressly provided in this Assignment and Assumption, without representation or warranty by the Assignor.

1.	Assignor:
2.	Assignee:
		[and is an [Affiliate/Approved Fund](2) of [identify Lender]] [and is an Affiliated Lender]
3.	Borrower(s):	CPI INTERNATIONAL ACQUISITION, INC. (f/k/a CATALYST HOLDINGS, INC.)

(2)Select as applicable.

B-1

4.Administrative Agent:  UBS AG, Stamford Branch, as the administrative agent under the Credit Agreement

5.Credit Agreement:  The Credit Agreement dated as of February 11, 2011 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) among CPI INTERNATIONAL ACQUISITION, INC. (f/k/a CATALYST HOLDINGS, INC.), a Delaware corporation (“Borrower”), CPI INTERNATIONAL HOLDING CORP. (f/k/a CATALYST HOLDINGS 2, INC.), a Delaware corporation (“Holdings”), the Subsidiary Guarantors party thereto, the Lenders, UBS LOAN FINANCE LLC, as swingline lender (in such capacity, “Swingline Lender”), and UBS AG, STAMFORD BRANCH, as issuing bank (in such capacity, “Issuing Bank”), as administrative agent (in such capacity, “Administrative Agent”) for the Lenders and as collateral agent (in such capacity, “Collateral Agent”) for the Secured Parties and the Issuing Bank.

6.             Assigned Interest:

Facility Assigned	Aggregate Amount of Commitment/ Loans for all Lenders	Amount of Commitment/ Loans Assigned	Percentage Assigned of Commitment/ Loans(3)
Term B Loans	$	$		%
Revolving Loans(4)	$	$		%
Swingline Loans(5)	$	$		%
Incremental Term Loans	$	$		%

(3) Set forth, to at least 9 decimals, as a percentage of the Commitment/Loans of all Lenders thereunder.

(4) Affiliated Lenders may not be an assignee of Revolving Loans or Revolving Commitments.

(5) Affiliated Lenders may not be an assignee of Revolving Loans or Revolving Commitments.

B-2

Effective Date:                              , 20       [TO BE INSERTED BY ADMINISTRATIVE AGENT AND WHICH SHALL BE THE EFFECTIVE DATE OF RECORDATION OF TRANSFER IN THE REGISTER THEREFOR.](6)

The terms set forth in this Assignment and Assumption are hereby agreed to:

ASSIGNOR
[NAME OF ASSIGNOR]
By:
	Title:

ASSIGNEE
[NAME OF ASSIGNEE]
By:
	Title:

[Consented to and Accepted:

CPI INTERNATIONAL ACQUISITION, INC.
By:
	Name:
	Title:](7)

(6) This date may not be fewer than 5 Business days after the date of assignment unless the Administrative Agent otherwise agrees.

(7) To be completed to the extent consent required under Section 10.04(b).

B-3

UBS AG, STAMFORD BRANCH,
as Administrative Agent [and Issuing Bank](8)
By:
	Name:
	Title:
By:
	Name:
	Title:
[UBS LOAN FINANCE,
as Swingline Lender
By:
	Name:
	Title:
By:
	Name:
	Title:](9)

(8)Reference to Issuing Bank required for an assignment of Revolving Commitments.

(9)Reference to Swingline Lender required for an assignment of Revolving Commitments.

B-4

ANNEX 1 to Assignment and Assumption

CPI INTERNATIONAL ACQUISITION, INC. (f/k/a CATALYST HOLDINGS, INC.).
CREDIT AGREEMENT

STANDARD TERMS AND CONDITIONS FOR
ASSIGNMENT AND ASSUMPTION

1.             Representations and Warranties.

1.1           Assignor.  The Assignor (a) represents and warrants that (i) it is the legal and beneficial owner of the Assigned Interest, (ii) the Assigned Interest is free and clear of any lien, encumbrance or other adverse claim and (iii) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby; and (b) assumes no responsibility with respect to (i) any statements, warranties or representations made in or in connection with the Credit Agreement or any other Loan Document, (ii) the execution, legality, validity, enforceability, genuineness, sufficiency or value of the Loan Documents or any collateral thereunder, (iii) the financial condition of Holdings, the Borrower, any of their Subsidiaries or Affiliates or any other person obligated in respect of any Loan Document or (iv) the performance or observance by Holdings, the Borrower, any of their Subsidiaries or Affiliates or any other person of any of their respective obligations under any Loan Document.

1.2.          Assignee.  The Assignee (a) represents and warrants that (i) it has full power and authority, and has taken all action necessary, to execute and deliver this Assignment and Assumption and to consummate the transactions contemplated hereby and to become a Lender under the Credit Agreement, (ii) it meets all requirements of an Eligible Assignee under the Credit Agreement (subject to receipt of such consents as may be required under the Credit Agreement), (iii) from and after the Effective Date (as set forth above), it shall be bound by the provisions of the Credit Agreement as a Lender thereunder and, to the extent of the Assigned Interest, shall have the obligations of a Lender thereunder, (iv) it is sophisticated with respect to decisions to acquire assets of the type represented by the Assigned Interest and either it, or the Person exercising discretion in making its decision to acquire the Assigned Interest, is experienced in acquiring assets of such type, (v) it has received a copy of the Credit Agreement, together with copies of the most recent financial statements delivered pursuant to Sections 4.01(e) or 5.01 thereof, as applicable, and such other documents and information as it has deemed appropriate to make its own credit analysis and decision to enter into this Assignment and Assumption and to purchase the Assigned Interest on the basis of which it has made such analysis and decision independently and without reliance on the Administrative Agent or any other Lender, (vi) if it is not already a Lender under the Credit Agreement, attached to the Assignment and Assumption an Administrative Questionnaire in the form of Exhibit A to the Credit Agreement, (vii) the Administrative Agent has received a processing and recordation fee of $3,500 as of the Effective Date[,] [and]

Annex 1-1

(viii) if it is a Foreign Lender, attached to the Assignment and Assumption is any documentation required to be delivered by it pursuant to Section 2.15 of the Credit Agreement, duly completed and executed by the Assignee [and (vix) it does not hold in the aggregate more than 20% of the outstanding principal amount of the Term Loans or Term Loan Commitments(10)]; and (b) agrees that (i) it will, independently and without reliance on the Administrative Agent, the Assignor or any other Lender, and based on such documents and information as it shall deem appropriate at the time, continue to make its own credit decisions in taking or not taking action under the Loan Documents, and (ii) it will perform in accordance with their terms all of the obligations that by the terms of the Loan Documents are required to be performed by it as a Lender.

2.             Payments.  From and after the Effective Date, the Administrative Agent shall make all payments in respect of the Assigned Interest (including payments of principal, interest, fees and other amounts) to the Assignor for amounts that have accrued to but excluding the Effective Date and to the Assignee for amounts that have accrued from and after the Effective Date.

3.             General Provisions.  This Assignment and Assumption shall be binding upon, and inure to the benefit of, the parties hereto and their respective successors and assigns.  This Assignment and Assumption may be executed in any number of counterparts, which together shall constitute one instrument.  Delivery of an executed counterpart of a signature page of this Assignment and Assumption by facsimile or other electronic means such as PDF shall be effective as delivery of a manually executed counterpart of this Assignment and Assumption.  This Assignment and Assumption shall be construed in accordance with and governed by, the law of the State of New York without regard to conflicts of principles of law that would require the application of the laws of another jurisdiction.

(10)         Include if Assignee is an Affiliated Lender.

Annex 1-2

EXHIBIT C

[Form of]
BORROWING REQUEST

UBS AG, Stamford Branch,

as Administrative Agent for

the Lenders referred to below,

677 Washington Boulevard

Stamford, Connecticut 06901

Attention:  Banking Products Services Agency

Re:          CPI INTERNATIONAL ACQUISITION, INC. (f/k/a CATALYST HOLDINGS, INC.)

[Date]

Ladies and Gentlemen:

Reference is made to the Credit Agreement dated as of February 11, 2011 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) among CPI INTERNATIONAL ACQUISITION, INC. (f/k/a CATALYST HOLDINGS, INC.), a Delaware corporation (“Borrower”), CPI INTERNATIONAL HOLDING CORP. (f/k/a CATALYST HOLDINGS 2, INC.), a Delaware corporation (“Holdings”), the Subsidiary Guarantors party thereto, the Lenders, UBS LOAN FINANCE LLC, as swingline lender (in such capacity, “Swingline Lender”), and UBS AG, STAMFORD BRANCH, as issuing bank (in such capacity, “Issuing Bank”), as administrative agent (in such capacity, “Administrative Agent”) for the Lenders and as collateral agent (in such capacity, “Collateral Agent”) for the Secured Parties and the Issuing Bank.  Borrower hereby gives you notice pursuant to Section 2.03 of the Credit Agreement that it requests a Borrowing under the Credit Agreement, and in that connection sets forth below the terms on which such Borrowing is requested to be made:

(A)	Class of Borrowing
	[Revolving Borrowing]
	[Term Borrowing(11)]
	[Swingline Loan]

(11)Specify Term B Borrowing or Incremental Term Borrowing.

C-1

(B)	Principal amount of Borrowing(12)
(C)	Date of Borrowing (which is a Business Day(13))
(D)	Type of Borrowing	[ABR] [Eurodollar](14)
(E)	In the case of Eurodollar Loans:
	Interest Period and the last day thereof(15)
(F)	Funds are requested to be disbursed to Borrower’s account with [    ] (Account No. [      ]).

[Borrower hereby represents and warrants that the conditions to lending specified in Sections 4.02(b), (c) and (d) of the Credit Agreement are satisfied as of the date hereof.](16)

[Signature Page Follows]

(12) ABR Loans must be in an amount that is at least $500,000 and an integral multiple of $500,000 or equal to the remaining available balance of the applicable Commitments.  Eurodollar Loans must be in an amount that is at least $1,000,000 and an integral multiple of $1,000,000 or equal to the remaining available balance of the applicable Commitments.

(13) Shall be a Business Day that is (a) the date hereof in the case of a borrowing into ABR Loans (other than Swingline Loans) to the extent this Borrowing Request is delivered to the Administrative Agent prior to 12:00 noon, New York City time on the date hereof, otherwise one Business Day following the date of delivery hereof, and (b) three Business Days following the date hereof in the case of a Borrowing into Eurollar Loans to the extent this Borrowing Request is delivered to the Administrative Agent prior to 11:00 a.m. New York City time on the date hereof, otherwise the fourth Business Day following the date of delivery hereof.

(14) Shall be ABR for Swingline Loans.

(15) Subject to the definition of “Interest Period” in the Credit Agreement.

(16) In the case of the initial Credit Extension, this sentence should be removed.

C-2

CPI INTERNATIONAL ACQUISITION, INC.
By:
	Name:
	Title:	[Responsible Officer]

C-3

EXHIBIT D

[Form of]
COMPLIANCE CERTIFICATE

I, [           ], the [Financial Officer] of CPI INTERNATIONAL ACQUISITION, INC. (in such capacity and not in my individual capacity), hereby certify that, with respect to that certain Credit Agreement dated as of February 11, 2011 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) among CPI INTERNATIONAL ACQUISITION, INC. (f/k/a CATALYST HOLDINGS, INC.), a Delaware corporation (“Borrower”), CPI INTERNATIONAL HOLDING CORP. (f/k/a CATALYST HOLDINGS 2, INC.), a Delaware corporation (“Holdings”), the Subsidiary Guarantors party thereto, the Lenders, UBS LOAN FINANCE LLC, as swingline lender (in such capacity, “Swingline Lender”), and UBS AG, STAMFORD BRANCH, as issuing bank (in such capacity, “Issuing Bank”), as administrative agent (in such capacity, “Administrative Agent”) for the Lenders and as collateral agent (in such capacity, “Collateral Agent”) for the Secured Parties and the Issuing Bank (capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement):

a.Attached hereto as Schedule 1 are detailed calculations demonstrating compliance by Borrower, Holdings and each Subsidiary Guarantor with Sections 6.09(a) and (b) [and, in the case of delivery of annual financial statements, Section 6.09(c)](17) of the Credit Agreement.  Borrower, Holdings and the Subsidiary Guarantors are in compliance with such Sections as of the date hereof.  [Attached hereto as Schedule 2 are detailed calculations setting forth the Borrower’s Excess Cash Flow.](18)  [Attached hereto as Schedule 3 is (i) a reconciliation of Consolidated EBITDA to the net income set forth on the statement of income and (ii) the report of an accounting firm setting forth the items required by Section 5.01(c)(ii) of the Credit Agreement.](19)

b.[No Default has occurred under the Credit Agreement which has not been previously disclosed, in writing, to the Administrative Agent pursuant to a Compliance Certificate.](20)

(17)To accompany annual financial statement only.

(18)Only to accompany Holdings’ annual financial statements for each fiscal year of Holdings, beginning with the fiscal year ending on or about September 30, 2012.

(19)Only to accompany Holdings’ annual financial statements beginning with the fiscal year ending on or about September 30, 2012.

(20)If a Default shall have occurred, an explanation specifying the nature and extent of such Default shall be provided on a separate page together with an explanation of the corrective action taken or

Footnote continued on next page.

D-1

[Signature Page Follows]

Footnote continued from previous page.

proposed to be taken with respect thereto (include, as applicable, information regarding actions, if any, taken since prior certificate).

D-2

Dated this [•] day of [•], 20[•].

CPI INTERNATIONAL ACQUISITION, INC.
By:
	Name:
	Title:	[Financial Officer]

D-3

SCHEDULE 1

Financial Covenants

(A)	Maximum Total Leverage Ratio:  Consolidated Indebtedness to Consolidated EBITDA
	(i)	Consolidated Indebtedness as of the last day of the four quarter period ended [•], 20[•]
	(ii)	Consolidated EBITDA Calculation
		Consolidated Net Income for the four quarter period ended [•], 20[•] equals:
		the aggregate net income of Holdings and its Restricted Subsidiaries for such period, on a consolidated basis, determined in accordance with GAAP
		(1) excluding the following:
		(a) the income of any person (other than a Restricted Subsidiary of Holdings) in which any other person (other than Holdings or any of its Restricted Subsidiaries) has a joint interest, except to the extent of the amount of dividends or other distributions actually paid to Holdings or any of its Restricted Subsidiaries by such person during such period
		(b) any gain (loss), together with any related provision for taxes on such gain (loss), realized in connection with any Asset Sale or other asset disposition or abandonment (other than in the ordinary course of business) and reserves relating thereto
		(c) any net unrealized gain (loss) (after any offset) resulting in such period from obligations under any Hedging Agreement or other derivative instruments and the application of ASC 815
		(d) any net unrealized gain (loss) (after any offset) resulting in such period from currency translation gains or losses including those related to currency remeasurements of Indebtedness

Sch. 1-1

(e) any gains (losses) resulting from the return of surplus assets of any Plan

(f) any non-recurring tax benefits resulting from the transactions contemplated by the Transaction Documents

(g) the income of any Restricted Subsidiary of Holdings to the extent that the payment thereof to Borrower or a Subsidiary Guarantor, whether by dividends or similar distributions, intercompany loan repayments or otherwise, is not at the time permitted for any reason other than by operation of any Requirement of Law applicable to that Restricted Subsidiary;(21)

Consolidated Net Income

(2) plus to the extent reducing (and not added back to) such Consolidated Net Income (other than in the case of clause (f)), the sum, without duplication, of amounts (calculated on an after tax basis where appropriate) for

(a) provision for taxes based on income or profit or capital, including state, local and franchise taxes (or the non-U.S. equivalent thereof) for such period (including tax expenses of Foreign Restricted Subsidiaries and foreign withholding taxes paid or accrued for such period)

(b) Consolidated Interest Expense for such period

(c) the total amount of depreciation and amortization expenses (including amortization of goodwill and other intangibles, and all expenditures in respect of licensed or purchased software or internally developed software and software enhancements that are, or are required to be reflected as, capitalized costs, but excluding amortization of prepaid cash expenses that were paid in a prior period) for such period

(21)Provided that, for the avoidance of doubt, the sole fact that such a payment would result in adverse tax consequences for any Company shall not cause such income to be excluded pursuant to this clause.

Sch. 1-2

(d) to the extent permitted to be made under Section 6.08(e) of the Credit Agreement, any management, monitoring, consulting and advisory fees (including termination fees) and related indemnities and expenses paid or accrued by Borrower in such period pursuant to the terms of the Advisory Agreement

(e) any other non-cash charges, expenses or losses reducing Consolidated Net Income for such period(22) but excluding amortization of a prepaid cash item that was paid in a prior period

(f) cash receipts (or any netting arrangements resulting in reduced cash expenditures) not representing Consolidated Net Income in any period to the extent non-cash gains relating to such income were deducted in the calculation of Consolidated Net Income pursuant to clause (3) below for any previous period

(g) the amount of any minority interest expense consisting of income of a Restricted Subsidiary attributable to minority equity interests of third parties in any non-wholly owned Restricted Subsidiary deducted in such period in calculating Consolidated Net Income

(h) any non-cash impairment charge or asset write-off or write-down, including impairment charges or asset write-offs or write downs related to intangible assets, long-lived assets, investments in debt and equity securities or otherwise as a result of a change in law or regulation (including the amortization of the consideration for any non-competition agreements entered into in connection with the transactions contemplated by the Transaction Documents)

(i) any net loss from discontinued operations and any net loss on disposal of discontinued operations

(22)Provided that if any such non-cash charges, expenses or losses represent an accrual or reserve for potential cash items in any future period, the cash payment in respect thereof in such future period shall be subtracted from Consolidated Net Income to such extent.

Sch. 1-3

(j) non-cash charges and expenses relating to employee benefit or other management compensation plans of any direct or indirect parent of Borrower (to the extent such non-cash charges relate to plans of any direct or indirect parent of Borrower for the benefit of members of the board of directors of Borrower (in their capacity as such) or employees of Borrower and its Restricted Subsidiaries), Borrower or any of its Restricted Subsidiaries or any non-cash compensation charge and other non-cash expenses or charges arising from any grant, issuance or repricing of stock appreciation or similar rights, stock, stock options, restricted stock or other equity based awards of any direct or indirect parent of Borrower (to the extent such non-cash charges relate to plans of any direct or indirect parent of Borrower for the benefit of members of the board of directors of Borrower (in their capacity as such) or employees of Borrower and its Restricted Subsidiaries), Borrower or any of its Restricted Subsidiaries (excluding in each case any non-cash charge to the extent that it represents an accrual of or reserve for cash expenses in any future period or amortization of a prepaid cash expense incurred in a prior period)

(k) any losses attributable to the extinguishment of any (1) Indebtedness or (2) other derivative instruments of Borrower or any of its Restricted Subsidiaries

(l) any fees, expenses, costs or charges (including all transaction, restructuring and transition costs, fees and expenses (including diligence costs, cash severance costs, retention payments to employees, lease termination costs and reserves)) or any amortization thereof, related to any Subject Transaction (in each case, including any such transaction undertaken but not completed), including (1) such fees, expenses or charges related to the Transactions and (2) any amendment or other modification of the Credit Agreement

Sch. 1-4

(m) accruals and reserves (other than fees, expenses, costs or charges relating to the Transactions) that are established within twelve months after the Closing Date that are so required to be established as a result of the Merger or the other Transactions in accordance with GAAP(23)

(n) any extraordinary losses during such period in accordance with GAAP

(o) any non-recurring or unusual expenses, losses or charges(24)

(3) minus the sum, without duplication, of the following amounts (calculated on an after tax basis where appropriate)

(a) non-cash gains increasing Consolidated Net Income for such period, excluding any such items to the extent they represent (1) the reversal in such period of an accrual of, or reserve for, potential cash expenses in a prior period after the Closing Date (which, for the avoidance of doubt, shall be deducted from Consolidated Net Income pursuant to clause (2)(e) above), and (2) the amortization of income and the accrual of revenue or income, in each case, to the extent cash is not received in the current period

(b) any net gain from discontinued operations or after-tax net gains from the disposal of discontinued operations to the extent increasing Consolidated Net Income

(c) any extraordinary, non-recurring or unusual gain to the extent increasing Consolidated Net Income

(d) the amount of any minority interest income consisting of Subsidiary Guarantor losses attributable to minority interests of third parties in any non-wholly owned Subsidiary Guarantor

(23)Provided that the aggregate amount under this clause (m) shall not exceed $5,000,000.

(24)Provided that the aggregate amount added to Consolidated EBITDA pursuant to this clause (o) shall not exceed $10,000,000 in such period.

Sch. 1-5

		[proceeds received from business interruption insurance and reimbursements of any expenses and charges that are covered by indemnification or other reimbursement provisions in connection with any Investment under Section 6.04(e) of the Credit Agreement, any Permitted Acquisition or any Asset Sale permitted under the Credit Agreement](25)
		[Deemed Consolidated EBITDA for the fiscal quarter ended [          ]](26)
		[any permitted Specified Equity Contributions made with respect to the Test Period]]
			Consolidated EBITDA
			Consolidated Indebtedness to Consolidated EBITDA	[  ]:1.00
			Covenant Requirement	No more than [  ]:1.00
(B)	Minimum Cash Interest Coverage Ratio:  Consolidated EBITDA to Cash Interest Expense
	(i)	Consolidated EBITDA for the four quarter period ended [•], 20[•]

(25)To be included to the extent not already included in the Consolidated Net Income of Holdings and its Restricted Subsidiaries.

(26)If deemed numbers are applicable for any relevant fiscal quarter, all other line items in the calculation of Consolidated EBITDA for such period shall exclude amounts from such fiscal quarter.

Sch. 1-6

(ii)	Cash Interest Expense Calculation(27):
	(1) Consolidated Interest Expense paid in cash
	(2) less the sum of
	(a) to the extent included in Consolidated Interest Expense and paid in cash during such period, amortization of debt issuance costs, debt discount or premium and other financing fees and expenses incurred by Holdings or any of its Restricted Subsidiaries for such period including, without limitation, net costs under Hedging Agreements dealing with interest rates and any commitment fees under such Hedging Agreements
	(b) any one-time cash costs paid in such period associated with breakage in respect of Hedging Agreements for interest rates
		Cash Interest Expense
		Consolidated EBITDA to Cash Interest Expense	[  ]:1.00
		Covenant Requirement	Greater than or equal to [  ]:1.00

(27)Provided that, subject to adjustment for events occurring after the Closing Date pursuant to Section 1.04 of the Credit Agreement, when determining Cash Interest Expense of Borrower in respect of any Test Period ending prior to the first anniversary of the Closing Date, Cash Interest Expense shall be calculated by multiplying the aggregate Cash Interest Expense accrued since the Closing Date by 365 and then dividing such product by the number of days from and including the Closing Date to and including the last day of such Test Period.  If the Cash Interest Coverage Ratio must be calculated on a Pro Forma Basis for the four-fiscal quarter period ending January 1, 2011 in order to determine the permissibility of a transaction thereunder, then, solely for such purpose, the Transactions shall be deemed to have been consummated on October 1, 2010 and Cash Interest Expense shall equal the Cash Interest Expense for the fiscal quarter of Borrower ended January 1, 2011 times four.

Sch. 1-7

[(C)	Maximum Capital Expenditures
	Capital Expenditures
		Stated Covenant Requirement	No more than $[  ]
		Carry Over
		2.5% of the net sales generated by the person or business acquired in any Permitted Acquisition after the Closing Date during the latest four full fiscal quarters prior to such Permitted Acquisition for which financial statements for such person or business are available (rounded to the nearest $100,000)
		Total Covenant Requirement	No more than $[  ]]

Sch. 1-8

[SCHEDULE 2

Excess Cash Flow Calculation:
Consolidated Net Income for fiscal year ended [         ], 20[•]
(a) The sum, without duplication, of the following:
	(i)	Consolidated Net Income
	(ii)	an amount equal to the sum of total depreciation expense, total amortization expense and other non-cash charges to the extent reducing Consolidated Net Income
	(iii)	decreases in Consolidated Working Capital for such period
	(iv)	an amount equal to the aggregate net non-cash loss on any asset sale by Holdings and its Restricted Subsidiaries during such period (other than sales in the ordinary course of business) to the extent deducted in arriving at Consolidated Net Income
over
(b) the sum, without duplication, of the following:(28)
	(i)	an amount equal to the amount of all non-cash, income, gains, and credits included in arriving at Consolidated Net Income
	(ii)	the aggregate amount of Capital Expenditures of and acquisitions of intellectual property, in each case to the extent made in cash, except to the extent financed with the proceeds of Indebtedness of Holdings or any of its Restricted Subsidiaries (other than Revolving Loans or Swingline Loans)

(28)Only to the extent not otherwise reducing Consolidated Net Income for such period.

Sch. 2-1

(iii)	the aggregate amount of all principal payments of Indebtedness of Holdings or its Restricted Subsidiaries (other than Loans but including the principal component of payments in respect of Capital Lease Obligations) made during such period, except to the extent financed with the proceeds of Indebtedness of Holdings or any of its Restricted Subsidiaries (other than Revolving Loans) or to the extent such payments are not permitted under the Credit Agreement
(iv)	increases in Consolidated Working Capital for such period
(v)	except to the extent financed with proceeds of Indebtedness of Holdings or any of its Restricted Subsidiaries (other than Revolving Loans or Swingline Loans), cash payments by Holdings and its Restricted Subsidiaries during such period in respect of long-term liabilities of Holdings and such Restricted Subsidiaries (other than Indebtedness)
(vi)	all cash amounts paid by Holdings and its Restricted Subsidiaries during such period in connection with all Permitted Acquisitions and all Investments pursuant to Section 6.04(d), (e), (k), (r) or (s) (except to the extent invested into a Restricted Subsidiary), to the extent not financed with the proceeds of Indebtedness of Holdings or its Restricted Subsidiaries (other than Revolving Loans)
(vii)	cash payments actually paid under earnout and contingent obligations incurred in connection with Permitted Acquisitions and Investments made pursuant to Section 6.04(k), (r) or (s) (except to the extent invested into a Restricted Subsidiary), to the extent not financed with the proceeds of Indebtedness of Holdings or any of its Restricted Subsidiaries (other than Revolving Loans)
(viii)	all amounts paid in cash in respect of covenants not to compete, consulting agreements and other affiliated contracts in connection with Permitted Acquisitions and Investments made pursuant to Section 6.04(k), (r) or (s) (except to the extent invested into a Restricted Subsidiary), to the extent not financed with the proceeds of Indebtedness of Holdings or any of its Restricted Subsidiaries (other than Revolving Loans)

Sch. 2-2

(ix)	reasonable cash costs, fees and expenses (including premium, make-whole and penalty payments) incurred in connection with the issuance or prepayment of any Indebtedness (including any refinancing, except to the extent such costs, fees and expenses are financed with the proceeds of Indebtedness of Holdings or any of its Restricted Subsidiaries (other than Revolving Loans))
(x)	reasonable costs, fees and expenses, in each case paid in cash in such period in each case incurred in connection with the issuance of Equity Interests (including all classes of stock, options to purchase stock and stock appreciation rights to management of a Loan Party), Investments, asset sales or divestitures, in each case as permitted under the Credit Agreement
(xi)	any cash Dividends made to Holdings by any Restricted Subsidiary thereof to the extent permitted under Section 6.07 (other than Section 6.07(d))
(xii)	any cash payment by Holdings and its Restricted Subsidiaries to Sponsor and/or other Affiliates (whether directly or through Holdings) to the extent permitted under Section 6.08(e)
(xiii)	cash taxes paid during such period that did not reduce Consolidated Net Income for such period and the amount of the excess of any cash payments (or tax reserves set aside or payable) in respect of taxes by Holdings and its Restricted Subsidiaries over the tax expense already deducted from Consolidated Net Income
(xiv)	repurchases of Equity Interests permitted by Section 6.07(b) of the Credit Agreement, to the extent funded with cash of the Holdings and its Restricted Subsidiaries
(xv)	to the extent paid in cash during such period, Transaction Costs
(xvi)	the net decrease during such fiscal year (if any) in deferred tax accounts of Holdings and its Restricted Subsidiaries

Sch. 2-3

(xvii)	cash payments by Holdings and its Restricted Subsidiaries during such period in respect of long-term liabilities (including cash pension payments and other cash payments in respect of retirement plans) (in each case, to the extent required to be made) of Holdings and its Restricted Subsidiaries other than Indebtedness
(xviii)	cash payments made during such period in respect of non-cash charges that increased Excess Cash Flow in any prior fiscal year
(xix)	cash payments made during such fiscal year in respect of employee retention payments in connection with a Subject Transaction
(xx)	the income of any Restricted Subsidiary (foreign or domestic) of Holdings (other than Borrower) to the extent that the payment of such income to the Loan Parties, whether by dividends or similar distributions, intercompany loan repayments or otherwise (1) is not at the time of calculation permitted by operation of any Requirements of Law applicable to that Restricted Subsidiary or (2) would at the time of calculation result in material adverse tax consequences for any Company(29)

(29)Provided, however, that to the extent such prohibition in clause (xx)(1) or material adverse tax consequence in clause (xx)(2) does not exist at the time of any future calculation, any amounts deducted from Excess Cash Flow pursuant to clause (xx)(1) or (xx)(2), as applicable, which have not already been added to Excess Cash Flow pursuant to this proviso, shall be added to Excess Cash Flow at the time of such future calculation; provided further that such Restricted Subsidiary’s income should not be deducted from Excess Cash Flow by operation of this clause (xx) to the extent such income was actually received in cash by Borrower or a Subsidiary Guarantor during such period.

Sch. 2-4

(xxi)	without duplication of amounts deducted from Excess Cash Flow in prior periods, the aggregate consideration required to be paid in cash by Borrower or its Restricted Subsidiaries pursuant to binding contracts (the “Contract Consideration”) entered into prior to or during such period relating to Permitted Acquisitions, Capital Expenditures or acquisitions of Intellectual Property to be consummated or made during the 90 days following such period to the extent intended to be financed with internally generated cash flow of Borrower and its Restricted Subsidiaries(30)
	Excess Cash Flow	]

(30)Provided that to the extent the aggregate amount of internally generated cash flow utilized to finance such Permitted Acquisitions, Capital Expenditures or acquisitions of Intellectual Property during such 90 days is less than the Contract Consideration, the amount of such shortfall shall be added to the calculation of Excess Cash Flow for the period following such period.

Sch. 2-5

[SCHEDULE 3

See Attached]

Sch. 3-1

EXHIBIT E

[Form of]
INTEREST ELECTION REQUEST

UBS AG, Stamford Branch,
   as Administrative Agent
677 Washington Boulevard
Stamford, Connecticut 06901

Attention:  Banking Products Services Agency

[Date]

Re:CPI INTERNATIONAL ACQUISITION, INC. (f/k/a CATALYST HOLDINGS, INC.)

Ladies and Gentlemen:

This Interest Election Request is delivered to you pursuant to Section 2.08 of the Credit Agreement dated as of February 11, 2011 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) among CPI INTERNATIONAL ACQUISITION, INC. (f/k/a CATALYST HOLDINGS, INC.), a Delaware corporation (“Borrower”), CPI INTERNATIONAL HOLDING CORP. (f/k/a CATALYST HOLDINGS 2, INC.), a Delaware corporation (“Holdings”), the Subsidiary Guarantors party thereto, the Lenders, UBS LOAN FINANCE LLC, as swingline lender (in such capacity, “Swingline Lender”), and UBS AG, STAMFORD BRANCH, as issuing bank (in such capacity, “Issuing Bank”), as administrative agent (in such capacity, “Administrative Agent”) for the Lenders and as collateral agent (in such capacity, “Collateral Agent”) for the Secured Parties and the Issuing Bank.  Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement.

Borrower hereby requests that on [                    ](31) (the “Interest Election Date”),

1.$[                    ] of the presently outstanding principal amount of the Loans originally made on [                    ],

(31)Shall be a Business Day that is (a) the date hereof in the case of a conversion into ABR Loans to the extent this Interest Election Request is delivered to the Administrative Agent prior to 12:00 noon, New York City time on the date hereof, otherwise one Business Day following the date of delivery hereof, and (b) three Business Days following the date hereof in the case of a conversion into/continuation of Eurodollar Loans to the extent this Interest Election Request is delivered to the Administrative Agent prior to 11:00 a.m. New York City time on the date hereof, otherwise the fourth Business Day following the date of delivery hereof, in each case.

E-1

2.and all presently being maintained as [ABR Loans] [Eurodollar Loans],

3.be [converted into] [continued as],

4.[Eurodollar Loans having an Interest Period of [one/two/three/six/nine/twelve months](32) [ABR Loans].

The undersigned hereby certifies that the following statements are true on the date hereof, and will be true on the proposed Interest Election Date, both before and after giving effect thereto and to the application of the proceeds therefrom:

(a)the foregoing [conversion] [continuation] complies with the terms and conditions of Section 2.08 of the Credit Agreement (including the limitations set forth in the definition of “Interest Period”);

(b)no Event of Default has occurred and is continuing, or would result from such proposed [conversion] [continuation].

[Signature Page Follows]

(32)Nine and twelve month Interest Periods available only if agreed to by all affected Lenders.

E-2

Borrower has caused this Interest Election Request to be executed and delivered by its duly authorized officer as of the date first written above.

CPI INTERNATIONAL ACQUISITION, INC.
By:
	Name:
	Title:

E-3

EXHIBIT F

[Form of]

JOINDER AGREEMENT

Reference is made to the Credit Agreement dated as of February 11, 2011 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) among CPI INTERNATIONAL ACQUISITION, INC. (f/k/a CATALYST HOLDINGS, INC.), a Delaware corporation (“Borrower”), CPI INTERNATIONAL HOLDING CORP. (f/k/a CATALYST HOLDINGS 2, INC.), a Delaware corporation (“Holdings”), the Subsidiary Guarantors party thereto, the Lenders, UBS LOAN FINANCE LLC, as swingline lender (in such capacity, “Swingline Lender”), and UBS AG, STAMFORD BRANCH, as issuing bank (in such capacity, “Issuing Bank”), as administrative agent (in such capacity, “Administrative Agent”) for the Lenders and as collateral agent (in such capacity, “Collateral Agent”) for the Secured Parties and the Issuing Bank.  Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement.

W I T N E S S E T H:

WHEREAS, the Guarantors have entered into the Credit Agreement and the Security Agreement in order to induce the Lenders to make the Loans and Issuing Bank to issue Letters of Credit to or for the benefit of Borrower;

WHEREAS, pursuant to Section 5.11(b) of the Credit Agreement, the undersigned Subsidiary (the “New Guarantor”) is executing this joinder agreement (“Joinder Agreement”) to the Credit Agreement in order to become a Subsidiary Guarantor as required under the Credit Agreement and to induce the Lenders to make additional Revolving Loans and Issuing Bank to issue Letters of Credit and as consideration for the Loans previously made and Letters of Credit previously issued.

NOW, THEREFORE, the Administrative Agent, Collateral Agent and the New Guarantor hereby agree as follows:

1.Guarantee.  In accordance with Section 5.11(b) of the Credit Agreement, the New Guarantor by its signature below becomes a Subsidiary Guarantor under the Credit Agreement with the same force and effect as if originally named therein as a Subsidiary Guarantor.

2.Representations and Warranties.  The New Guarantor hereby (a) agrees to all the terms and provisions of the Credit Agreement applicable to it as a Subsidiary Guarantor thereunder and (b) represents and warrants that the representations and warranties made by it as a Subsidiary Guarantor thereunder are true and correct in all material respects (except that any representation and warranty that is qualified as to “materiality” or “Material Adverse Effect” shall be true and correct in all respects) on and as of the date hereof (except to the extent such representation and warranties expressly relate to an earlier date).  Each reference to a Subsidiary Guarantor in the Credit Agreement shall be deemed to include the New Guarantor.  The New Guarantor hereby attaches supplements to the schedules to the Credit Agreement applicable to it.

F-1

3.Severability.  Any provision of this Joinder 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.

4.Counterparts.  This Joinder Agreement may be executed in counterparts, each of which shall constitute an original.  Delivery of an executed signature page to this Joinder Agreement by facsimile or other electronic transmission such as PDF shall be as effective as delivery of a manually executed counterpart of this Joinder Agreement.

5.No Waiver.  Except as expressly supplemented hereby, the Credit Agreement shall remain in full force and effect.

6.Notices.  All notices, requests and demands to or upon the New Guarantor, any Agent or any Lender shall be governed by the terms of Section 10.01 of the Credit Agreement.

7.Governing Law.  THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION.

[Signature Pages Follow]

F-2

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

[NEW GUARANTOR]
By:
	Name:
	Title:
Address for Notices:
UBS AG, STAMFORD BRANCH, as
Administrative Agent and Collateral Agent
By:
	Name:
	Title:
By:
	Name:
	Title:

F-3

[Note:  Schedules to be attached.]

F-4

EXHIBIT G

[RESERVED]

G-1

EXHIBIT H

[Form of]
LC REQUEST [AMENDMENT]

Dated   (33)

UBS AG, Stamford Branch,
     as Administrative Agent
     under the Credit Agreement referenced below

677 Washington Boulevard
Stamford, Connecticut 06901
Attention:  Banking Products Services Agency

[Name and address of Issuing Bank
if different from Administrative Agent]

Ladies and Gentlemen:

Reference is made to that certain Credit Agreement dated as of February 11, 2011 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) among CPI INTERNATIONAL ACQUISITION, INC. (f/k/a CATALYST HOLDINGS, INC.), a Delaware corporation (“Borrower”), CPI INTERNATIONAL HOLDING CORP. (f/k/a CATALYST HOLDINGS 2, INC.), a Delaware corporation (“Holdings”), the Subsidiary Guarantors party thereto, the Lenders, UBS LOAN FINANCE LLC, as swingline lender (in such capacity, “Swingline Lender”), and UBS AG, STAMFORD BRANCH, as issuing bank (in such capacity, “Issuing Bank”), as administrative agent (in such capacity, “Administrative Agent”) for the Lenders and as collateral agent (in such capacity, “Collateral Agent”) for the Secured Parties and the Issuing Bank.

We hereby request that [name of proposed Issuing Bank], as the Issuing Bank under the Credit Agreement, [issue] [amend] [renew] [extend] [a] [an existing] [Standby] [Commercial] Letter of Credit for the account of the undersigned[(34)] on [(35)] (the “Date of [Issuance] [Amendment]

(33)Date of LC Request.

(34)Note that if the LC Request is for the account of a Restricted Subsidiary, Borrower shall be a co-applicant, and be jointly and severally liable, with respect to each Letter of Credit issued for the account or in favor of any Restricted Subsidiary.

(35)Date of [Issuance] [Amendment] [Renewal] [Extension] which shall be at least three Business Days after the date of this LC Request, if this LC Request is delivered to Issuing Bank by 12:00 noon, New York City time (or such shorter period as is acceptable to Issuing Bank).

H-1

[Renewal] [Extension]”) in the aggregate stated amount of [(36)].  [Such Letter of Credit was originally issued on [date].]  The requested Letter of Credit [shall be] [is] denominated in [Dollars].  [The requested Letter of Credit is requested as an Auto-Renewal Letter of Credit.]

For purposes of this LC Request, unless otherwise defined herein, all capitalized terms used herein which are defined in the Credit Agreement shall have the respective meaning provided therein.

The beneficiary of the requested Letter of Credit [will be] [is] [(37)], and such Letter of Credit [will be] [is] in support of [(38)] and [will have] [has] a stated expiration date of [(39)].  [Describe the nature of the amendment, renewal or extension.]  [The documents to be presented by the beneficiary in connection with any drawing under the requested Letter of Credit are [·] [and a certificate of the beneficiary in the form attached hereto as Exhibit A].]

We hereby certify that:

(1)At the time of and immediately after giving effect to the Letter of Credit [issuance] [amendment] [renewal] [extension] on the date hereof and the application of the proceeds thereof, no Default or Event of Default has occurred or will be continuing.

(2)Each of the representations and warranties made by any Loan Party set forth in Article III of the Credit Agreement or in any other Loan Document are true and correct in all material respects (except that any representation and warranty that is qualified as to “materiality” or “Material Adverse Effect” are true and correct in all respects) on and as of today’s date with the same effect as though made on and as of today’s date, except to the extent such representations and warranties expressly relate to an earlier date.

(3)With respect to Letters of Credit issued for the account of a Restricted Subsidiary only, the Lenders and the Administrative Agent have timely received the information required under Section 10.13 of the Credit Agreement.

(36)Aggregate initial stated amount of Letter of Credit.

(37)Insert name and address of beneficiary.

(38)Insert description of the obligation or commercial transaction to which it relates.

(39)Insert last date upon which drafts may be presented (assuming any automatic renewal is prevented) which may not be later than (i) the date which is one year after the date of the issuance of such Letter of Credit (or, in the case of any renewal or extension thereof, one year after such renewal or extension) and (ii) the Letter of Credit Expiration Date.

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(4)After giving effect to the request herein, the LC Exposure will not exceed the LC Commitment and the total Revolving Exposures will not exceed the total Revolving Commitments.

H-3

Copies of the documents to be presented in connection with any drawing under the Letter of Credit are attached hereto.

CPI INTERNATIONAL ACQUISITION, INC.
By:
	Name:
	Title:

H-4

EXHIBIT I

[Form of]
LENDER ADDENDUM

Reference is made to the Credit Agreement dated as of February 11, 2011 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) among CPI INTERNATIONAL ACQUISITION, INC. (f/k/a CATALYST HOLDINGS, INC.), a Delaware corporation (“Borrower”), CPI INTERNATIONAL HOLDING CORP. (f/k/a CATALYST HOLDINGS 2, INC.), a Delaware corporation (“Holdings”), the Subsidiary Guarantors party thereto, the Lenders, UBS LOAN FINANCE LLC, as swingline lender (in such capacity, “Swingline Lender”), and UBS AG, STAMFORD BRANCH, as issuing bank (in such capacity, “Issuing Bank”), as administrative agent (in such capacity, “Administrative Agent”) for the Lenders and as collateral agent (in such capacity, “Collateral Agent”) for the Secured Parties and the Issuing Bank.  Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement.

Upon execution and delivery of this Lender Addendum by the parties hereto as provided in Section 10.15 of the Credit Agreement, the undersigned hereby becomes a Lender thereunder having the Commitment set forth in Schedule 1 hereto, effective as of the Closing Date.

THIS LENDER ADDENDUM SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK, WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION.

This Lender Addendum may be executed by one or more of the parties hereto on any number of separate counterparts, and all of said counterparts taken together shall be deemed to constitute one and the same instrument.  Delivery of an executed signature page hereof by facsimile transmission or other electronic means such as PDF shall be effective as delivery of a manually executed counterpart hereof.

I-1

IN WITNESS WHEREOF, the parties hereto have caused this Lender Addendum to be duly executed and delivered by their proper and duly authorized officers as of this        day of [          ], 201[·].

,
as a Lender
[Please type legal name of Lender above]
By:
	Name:
	Title:
[If second signature is necessary:]
By:
	Name:
	Title:

I-2

Accepted and agreed:
CPI INTERNATIONAL ACQUISITION, INC.
By:
	Name:
	Title:
UBS AG, STAMFORD BRANCH,
as Administrative Agent
By:
	Name:
	Title:
By:
	Name:
	Title:

I-3

Schedule 1

COMMITMENTS AND NOTICE ADDRESS

1.	Name of Lender:
	Notice Address:
	Attention:
	Telephone:
	Facsimile:
2.	Commitment:

I-4

EXHIBIT J

[Form of]
MORTGAGE

[Attached]

J-1

EXHIBIT K-1

[Form of]
TERM B NOTE

$	New York, New York
	[Date]

FOR VALUE RECEIVED, the undersigned, CPI INTERNATIONAL ACQUISITION, INC. (f/k/a CATALYST HOLDINGS, INC.), a Delaware Corporation (“Borrower”), hereby promises to pay to [LENDER] (the “Lender”) or registered assigns, on the Term B Loan Maturity Date (as defined in the Credit Agreement referred to below) in lawful money of the United States and in immediately available funds, the principal amount of                 DOLLARS ($                ), or, if less, the aggregate unpaid principal amount of all Term B Loans of the Lender outstanding under the Credit Agreement referred to below, which sum shall be due and payable in such amounts and on such dates as are set forth in the Credit Agreement.  Borrower further agrees to pay interest in like money at such office specified in Section 2.14 of the Credit Agreement on the unpaid principal amount hereof from time to time from the date hereof at the rates, and on the dates, specified in Section 2.06 of such Credit Agreement.

Subject to Section 10.04(c) of the Credit Agreement, the holder of this Note may endorse and attach a schedule to reflect the date, Type and amount of each Term B Loan of the Lender outstanding under the Credit Agreement, the date and amount of each payment or prepayment of principal hereof, and the date of each interest rate conversion or continuation pursuant to Section 2.08 of the Credit Agreement and the principal amount subject thereto; provided that the failure of the Lender to make any such recordation (or any error in such recordation) shall not affect the obligations of Borrower hereunder or under the Credit Agreement.

This Note is one of the Notes referred to in the Credit Agreement dated as of February 11, 2011 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) among Borrower, CPI INTERNATIONAL HOLDING CORP. (f/k/a CATALYST HOLDINGS 2, INC.), a Delaware corporation (“Holdings”), the Subsidiary Guarantors party thereto, the Lenders, UBS LOAN FINANCE LLC, as swingline lender (in such capacity, “Swingline Lender”), and UBS AG, STAMFORD BRANCH, as issuing bank (in such capacity, “Issuing Bank”), as administrative agent (in such capacity, “Administrative Agent”) for the Lenders and as collateral agent (in such capacity, “Collateral Agent”) for the Secured Parties and the Issuing Bank, is subject to the provisions thereof and is subject to optional and mandatory prepayment in whole or in part as provided therein.  Terms used herein which are defined in the Credit Agreement shall have such defined meanings unless otherwise defined herein or unless the context otherwise requires.

This Note is secured and guaranteed as provided in the Credit Agreement and the Security Documents.  Reference is hereby made to the Credit Agreement and the Security Documents for a description of the properties and assets in which a security interest has been granted, the nature and extent of the security and guarantees, the terms and conditions upon which the security

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interest and each guarantee was granted and the rights of the holder of this Note in respect thereof.

Upon the occurrence of any one or more of the Events of Default specified in the Credit Agreement, all amounts then remaining unpaid on this Note shall become, or may be declared to be, immediately due and payable all as provided therein.

All parties now and hereafter liable with respect to this Note, whether maker, principal, surety, guarantor, endorser or otherwise, hereby waive presentment, demand, protest and all other notices of any kind.

THIS NOTE MAY NOT BE TRANSFERRED EXCEPT IN COMPLIANCE WITH THE TERMS OF THE CREDIT AGREEMENT.  TRANSFERS OF THIS NOTE MUST BE RECORDED IN THE REGISTER MAINTAINED BY THE ADMINISTRATIVE AGENT PURSUANT TO THE TERMS OF THE CREDIT AGREEMENT.

THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION.

[Signature Page Follows]

K-1-2

CPI INTERNATIONAL ACQUISITION, INC.
as Borrower
By:
	Name:
	Title:

K-1-3

EXHIBIT K-2

[Form of]
REVOLVING NOTE

$	New York, New York
	[Date]

FOR VALUE RECEIVED, the undersigned, CPI INTERNATIONAL ACQUISITION, INC. (f/k/a CATALYST HOLDINGS, INC.), a Delaware Corporation (“Borrower”), hereby promises to pay to [Lender] (the “Lender”) or registered assigns, on the Revolving Maturity Date (as defined in the Credit Agreement referred to below), in lawful money of the United States and in immediately available funds, the principal amount of the lesser of (a)                          DOLLARS ($                        ) and (b) the aggregate unpaid principal amount of all Revolving Loans of the Lender outstanding under the Credit Agreement referred to below.  Borrower further agrees to pay interest in like money at such office specified in Section 2.14 of the Credit Agreement on the unpaid principal amount hereof from time to time from the date hereof at the rates, and on the dates, specified in Section 2.06 of such Credit Agreement.

Subject to Section 10.04(c) of the Credit Agreement, the holder of this Note may endorse and attach a schedule to reflect the date, Type and amount of each Revolving Loan of the Lender outstanding under the Credit Agreement, the date and amount of each payment or prepayment of principal hereof, and the date of each interest rate conversion or continuation pursuant to Section 2.08 of the Credit Agreement and the principal amount subject thereto; provided that the failure of the Lender to make any such recordation (or any error in such recordation) shall not affect the obligations of Borrower hereunder or under the Credit Agreement.

This Note is one of the Notes referred to in the Credit Agreement dated as of February 11, 2011 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) among Borrower, CPI INTERNATIONAL HOLDING CORP. (f/k/a CATALYST HOLDINGS 2, INC.), a Delaware corporation (“Holdings”), the Subsidiary Guarantors party thereto, the Lenders, UBS LOAN FINANCE LLC, as swingline lender (in such capacity, “Swingline Lender”), and UBS AG, STAMFORD BRANCH, as issuing bank (in such capacity, “Issuing Bank”), as administrative agent (in such capacity, “Administrative Agent”) for the Lenders and as collateral agent (in such capacity, “Collateral Agent”) for the Secured Parties and the Issuing Bank, is subject to the provisions thereof and is subject to optional and mandatory prepayment in whole or in part as provided therein.  Terms used herein which are defined in the Credit Agreement shall have such defined meanings unless otherwise defined herein or unless the context otherwise requires.

This Note is secured and guaranteed as provided in the Credit Agreement and the Security Documents.  Reference is hereby made to the Credit Agreement and the Security Documents for a description of the properties and assets in which a security interest has been granted, the nature and extent of the security and guarantees, the terms and conditions upon which the security interest and each guarantee was granted and the rights of the holder of this Note in respect thereof.

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Upon the occurrence of any one or more of the Events of Default specified in the Credit Agreement, all amounts then remaining unpaid on this Note shall become, or may be declared to be, immediately due and payable, all as provided therein.

All parties now and hereafter liable with respect to this Note, whether maker, principal, surety, guarantor, endorser or otherwise, hereby waive presentment, demand, protest and all other notices of any kind.

THIS NOTE MAY NOT BE TRANSFERRED EXCEPT IN COMPLIANCE WITH THE TERMS OF THE CREDIT AGREEMENT.  TRANSFERS OF THIS NOTE MUST BE RECORDED IN THE REGISTER MAINTAINED BY THE ADMINISTRATIVE AGENT PURSUANT TO THE TERMS OF THE CREDIT AGREEMENT.

THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION.

[Signature Page Follows]

K-2-2

CPI INTERNATIONAL ACQUISITION, INC.
as Borrower
By:
	Name:
	Title:

K-2-3

EXHIBIT K-3

[Form of]
SWINGLINE NOTE

$	New York, New York
	[Date]

FOR VALUE RECEIVED, the undersigned, CPI INTERNATIONAL ACQUISITION, INC. (f/k/a CATALYST HOLDINGS, INC.), a Delaware Corporation (“Borrower”), hereby promises to pay to the order of UBS LOAN FINANCE LLC (the “Lender”) or registered assigns, on the Revolving Maturity Date (as defined in the Credit Agreement referred to below), in lawful money of the United States and in immediately available funds, the principal amount of the lesser of (a)                          ($                        ) and (b) the aggregate unpaid principal amount of all Swingline Loans made by Lender to the undersigned pursuant to Section 2.17 of the Credit Agreement referred to below.  Borrower further agrees to pay interest on the unpaid principal amount hereof in like money at such office specified in Section 2.14 of the Credit Agreement from time to time from the date hereof at the rates and on the dates specified in Section 2.06 of the Credit Agreement.

Subject to Section 10.04(c) of the Credit Agreement, the holder of this Note may endorse and attach a schedule to reflect the date, the amount of each Swingline Loan and the date and amount of each payment or prepayment of principal thereof; provided that the failure of Lender to make such recordation (or any error in such recordation) shall not affect the obligations of Borrower hereunder or under the Credit Agreement.

This Note is one of the Notes referred to in the Credit Agreement dated as of February 11, 2011 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) among Borrower, CPI INTERNATIONAL HOLDING CORP. (f/k/a CATALYST HOLDINGS 2, INC.), a Delaware corporation (“Holdings”), the Subsidiary Guarantors party thereto, the Lenders, UBS LOAN FINANCE LLC, as swingline lender (in such capacity, “Swingline Lender”), and UBS AG, STAMFORD BRANCH, as issuing bank (in such capacity, “Issuing Bank”), as administrative agent (in such capacity, “Administrative Agent”) for the Lenders and as collateral agent (in such capacity, “Collateral Agent”) for the Secured Parties and the Issuing Bank, is subject to the provisions thereof and is subject to optional and mandatory prepayment in whole or in part as provided therein.  Terms used herein which are defined in the Credit Agreement shall have such defined meanings unless otherwise defined herein or unless the context otherwise requires.

This Note is secured and guaranteed as provided in the Credit Agreement and the Security Documents.  Reference is hereby made to the Credit Agreement and the Security Documents for a description of the properties and assets in which a security interest has been granted, the nature and extent of the security and guarantees, the terms and conditions upon which the security interest and each guarantee was granted and the rights of the holder of this Note in respect thereof.

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Upon the occurrence of any one or more of the Events of Default specified in the Credit Agreement, all amounts then remaining unpaid on this Note may become, or may be declared to be, immediately due and payable as provided in the Credit Agreement.

All parties now and hereafter liable with respect to this Note, whether maker, principal, surety, guarantor, endorser or otherwise, hereby waive presentment, demand, protest and all other notices of any kind.

THIS NOTE MAY NOT BE TRANSFERRED EXCEPT IN COMPLIANCE WITH THE TERMS OF THE CREDIT AGREEMENT.  TRANSFERS OF THIS NOTE MUST BE RECORDED IN THE REGISTER MAINTAINED BY THE ADMINISTRATIVE AGENT PURSUANT TO THE TERMS OF THE CREDIT AGREEMENT.

THIS NOTE SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAW PRINCIPLES THAT WOULD REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION.

[Signature Page Follows]

K-3-2

CPI INTERNATIONAL ACQUISITION, INC.
as Borrower
By:
	Name:
	Title:

K-3-3

EXHIBIT L-1

[Form of]
PERFECTION CERTIFICATE

[Provided Under Separate Cover]

L-1-1

EXHIBIT L-2

[Form of]
PERFECTION CERTIFICATE SUPPLEMENT

[Provided Under Separate Cover]

L-2-1

EXHIBIT M

[Form of]
SECURITY AGREEMENT

[Provided Under Separate Cover]

M-1

EXHIBIT N

[RESERVED]

N-1

EXHIBIT O

[Form of]
SOLVENCY CERTIFICATE

February 11, 2011

This Certificate is furnished pursuant to Section 4.01(h) of the Credit Agreement dated as of February 11, 2011 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) among CPI INTERNATIONAL ACQUISITION, INC., a Delaware corporation (“Borrower”), CPI INTERNATIONAL HOLDING CORP., a Delaware corporation (“Holdings”), the Subsidiary Guarantors party thereto, the lenders party thereto (the “Lenders”), UBS LOAN FINANCE LLC, as swingline lender, and UBS AG, STAMFORD BRANCH, as issuing bank (in such capacity, “Issuing Bank”), as administrative agent for the Lenders and as collateral agent for the Secured Parties and the Issuing Bank.  Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement.

I, the undersigned, Chief Financial Officer of Borrower, do hereby certify on behalf of Borrower, solely in my capacity as an officer and not in an individual capacity, that, on the date hereof, after giving effect to the consummation of the Transactions:

1.The sum of the present debt and liabilities (including subordinated and contingent liabilities) of Holdings and its Restricted Subsidiaries, on a consolidated basis, does not exceed the fair value of the present assets of Holdings and its Restricted Subsidiaries, on a consolidated basis.

2.The present fair saleable value of the assets of Holdings and its Restricted Subsidiaries, on a consolidated basis, is greater than the total amount that will be required to pay the debt and liabilities (including subordinated and contingent liabilities) of Holdings and its Restricted Subsidiaries as they become absolute and matured.

3.The capital of Holdings and its Restricted Subsidiaries, on a consolidated basis, is not unreasonably small in relation to their business (taken as a whole) as contemplated on the date hereof and as proposed to be conducted following the Closing Date.

4.Holdings and its Restricted Subsidiaries, on a consolidated basis, have not incurred and do not intend to incur, or believe that they will incur, debts or other liabilities including current obligations, beyond their ability to pay such debts or other liabilities as they become due (whether at maturity or otherwise).

For purposes of this Certificate, the amount of any contingent liability has been computed as the amount that, in light of all of the facts and circumstances existing as of the date hereof, represents the amount that can reasonably be expected to become an actual or matured liability.

O-1

The undersigned is familiar with the business and financial position of Holdings and its Restricted Subsidiaries. In reaching the conclusions set forth in this Certificate, the undersigned has made such other investigations and inquiries as the undersigned has deemed appropriate, having taken into account the nature of the particular business anticipated to be conducted by Holdings and its Restricted Subsidiaries after consummation of the Transactions.

[Signature Page Follows]

P-2

IN WITNESS WHEREOF, I have hereunto set my hand as of the date first written above.

CPI INTERNATIONAL ACQUISITION, INC.
(f/k/a CATALYST HOLDINGS, INC.)
By:
	Name:
	Title:

P-3

EXHIBIT P

[Form of]
INTERCOMPANY SUBORDINATION AGREEMENT

THIS INTERCOMPANY SUBORDINATION AGREEMENT (this “Agreement”), dated as of February 11, 2011, is made among CPI INTERNATIONAL ACQUISITION, INC. (f/k/a CATALYST HOLDINGS, INC.), a Delaware corporation (“Borrower”), CPI INTERNATIONAL HOLDING CORP. (f/k/a CATALYST HOLDINGS 2, INC.), a Delaware corporation (“Holdings”) the subsidiaries of the Borrower party hereto (the “Subsidiaries”) and UBS AG, STAMFORD BRANCH, as administrative agent (in such capacity, “Administrative Agent”) for the Lenders.

WHEREAS, Borrower, Holdings, the Subsidiary Guarantors party thereto, the Lenders, UBS LOAN FINANCE LLC, as Swingline Lender, and UBS AG, STAMFORD BRANCH, as Issuing Bank, as Administrative Agent for the Lenders and as Collateral Agent for the Secured Parties and the Issuing Bank have entered into the Credit Agreement dated as of February 11, 2011 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”).  Capitalized terms used but not defined herein shall have the meanings given to them in the Credit Agreement.

WHEREAS, pursuant to Article VII of the Credit Agreement, Holdings and the Subsidiary Guarantors have agered to guarantee the Obligations of Borrower under the Credit Agreement;

WHEREAS, each of Holdings and its Subsidiaries (each, a “Company”) has made or may make certain loans or advances (each, an “Intercompany Loan”) from time to time to one or more other Companies;

WHEREAS, in order to induce the Administrative Agent and the Lenders to enter into the Credit Agreement, each Company (in such capacity, a “Payee”) has agreed to the subordination of such Intercompany Loans made to any Loan Party (in such capacity, a “Payor”) by such Payee, upon the terms and subject to the conditions set forth in this Agreement and has further agreed that any Intercompany Loan by or to a Loan Party shall be evidenced by a promissory note and shall be subject to this Agreement and, in the case of a loan or advance by a Loan Party, pledged by such Loan Party as Collateral pursuant to the Security Documents.

NOW, THEREFORE, in consideration of the mutual promises, covenants, conditions, representations, and warranties set forth herein and for other good and valuable consideration, the parties hereto agree as follows:

SECTION 1.01.Anything in any agreement governing the Intercompany Loans to the contrary notwithstanding, all Intercompany Loans owed by any Payor to any Payee (the “Subordinated Indebtedness”) shall be subordinate and junior in right of payment, to the extent and in the manner hereinafter set forth, to the prior payment in full of all Obligations of such Payor under

P-1

the Credit Agreement including, without limitation, where applicable, under such Payor’s guarantee of the Obligations under the Credit Agreement (such Obligations including interest thereon accruing after the commencement of any proceedings referred to in clause (a) below, whether or not such interest is an allowed claim in such proceeding, being hereinafter collectively referred to as “Senior Indebtedness”):

(a)In the event of any insolvency or bankruptcy proceedings, and any receivership, liquidation, reorganization or other similar proceedings in connection therewith, relative to any Payor, then (x) the holders of Senior Indebtedness shall be paid in full in cash in respect of all amounts (other than unasserted contingent indemnification obligations and other similar contingent obligations not yet due and payable) constituting Senior Indebtedness before any Payee is entitled to receive (whether directly or indirectly), or make any demands for, any payment on account of such Subordinated Indebtedness and (y) until the holders of Senior Indebtedness are paid in full in cash in respect of all amounts constituting Senior Indebtedness (other than unasserted contingent indemnification obligations and other similar contingent obligations not yet due and payable), any payment or distribution to which such Payee would otherwise be entitled shall be made to the holders of Senior Indebtedness;

(b)if any Event of Default occurs and is continuing with respect to any Senior Indebtedness, no payment or distribution of any kind or character shall be made by or on behalf of the Payor or any other Person on its behalf with respect to Subordinated Indebtedness; and

(c)if any payment or distribution of any character, whether in cash, securities or other property, in respect of Subordinated Indebtedness shall (despite these subordination provisions) be received by any Payee in violation of clause (a) or (b) before all Senior Indebtedness shall have been paid in full in cash (other than unasserted contingent indemnification obligations and other similar contingent obligations not yet due and payable), such payment or distribution shall be held in trust for the benefit of, and shall be paid over or delivered to, the Administrative Agent for distribution to the holders of Senior Indebtedness, ratably according to the respective aggregate amounts remaining unpaid thereon, to the extent necessary to pay all Senior Indebtedness in full in cash.

SECTION 1.02.To the fullest extent permitted by law, no present or future holder of Senior Indebtedness shall be prejudiced in its right to enforce the subordination of the Subordinated Indebtedness set forth herein by any act or failure to act on the part of any Payor or by any act or failure to act on the part of such holder or any trustee or agent for such holder. Each Payee and each Payor hereby agree that the subordination required hereunder is for the benefit of the Administrative Agent, Issuing Bank and the Lenders, and that the Administrative Agent may, on behalf of the itself, Issuing Bank and the Lenders, proceed to enforce the subordination provisions herein.

SECTION 1.03.Nothing contained in the subordination provisions set forth above is intended to or will impair, as between each Payor and each Payee, the obligations of such Payor, which are absolute and unconditional, to pay to such Payee the principal of and interest on the Subordinated Indebtedness as and when due and payable in accordance with its terms, or is intended

P-2

to or will affect the relative rights of such Payee and other creditors of such Payor other than the holders of Senior Indebtedness. Except to the extent provided in Section 1.01, each Payor may make all payments in respect of Subordinated Indebtedness as and when the same shall be due and payable in accordance with its terms.

SECTION 1.04.All notes and other instruments evidencing any of the Subordinated Indebtedness, if any, shall be endorsed with a legend noting that such documents and instruments are subject to this Agreement, and each Payee shall promptly deliver to Administrative Agent evidence of the same. Such legend shall appear in substantially the following form:

“This Note is subject to the terms and provisions of the Intercompany Subordination Agreement executed by the Payee in favor of UBS AG, Stamford Branch, as Administrative Agent.”

SECTION 1.05.Each Payor and Payee shall execute, acknowledge, deliver, file, notarize, and register at its own expense all such further agreements, instruments, certificates, financing statements, documents, and assurances, and perform such acts as Administrative Agent reasonably shall deem necessary to effectuate the purposes of this Agreement, and promptly provide Administrative Agent with evidence of the foregoing reasonably satisfactory to Administrative Agent.

SECTION 1.06.This Agreement is entered into for the sole protection and benefit of the parties hereto and the Secured Parties and their successors and assigns, and no other Person shall be a direct or indirect beneficiary of, or shall have any direct or indirect cause of action or claim in connection with, this Agreement.

SECTION 1.07.This Agreement shall be binding upon, inure to the benefit of and be enforceable by each Payor and Payee and by the Administrative Agent, on behalf of each Lender and other Secured Party and their respective successors and permitted assigns.

SECTION 1.08.THE VALIDITY OF THIS AGREEMENT, THE CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT HEREOF, AND THE RIGHTS OF THE PARTIES HERETO WITH RESPECT TO ALL MATTERS ARISING HEREUNDER OR RELATED HERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO ANY CHOICE OF LAW RULES THAT MAY REQUIRE THE APPLICATION OF THE LAWS OF ANOTHER JURISDICTION.

SECTION 1.09.EACH PAYOR AND PAYEE HEREBY (i) SUBMITS TO THE NONEXCLUSIVE JURISDICTION OF THE COURTS OF THE STATE OF NEW YORK AND THE FEDERAL COURTS OF THE UNITED STATES SITTING IN THE COUNTY OF NEW YORK, STATE OF NEW YORK.

SECTION 1.10.This Agreement constitutes the entire agreement of each of the Payees, Payors, Administrative Agent and each of the Secured Parties with respect to the matters set forth herein and supersedes any prior agreements, commitments, draft, communications, discussions and understandings, oral or written, with respect thereto.

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SECTION 1.11.No amendment to any provision of this Agreement shall in any event be effective unless the same shall be in writing and signed by each of the Payees and Payors and the Administrative Agent; and no waiver of any provision of this Agreement, or consent to any departure by any Payee or Payor therefrom, shall in any event be effective unless the same shall be in writing and signed by Administrative Agent. Any such amendment, waiver, or consent shall be effective only in the specific instance and for the specific purpose for which given.

SECTION 1.12.Whenever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under all applicable laws and regulations. If, however, any provision of this Agreement shall be prohibited by or invalid under any such law or regulation in any jurisdiction, it shall, as to such jurisdiction, be deemed modified to conform to the minimum requirements of such law or regulation, or, if for any reason it is not deemed so modified, it shall be ineffective and invalid only to the extent of such prohibition or invalidity without affecting the remaining provisions of this Agreement or the validity or effectiveness of such provision in any other jurisdiction.

SECTION 1.13.This Agreement may be executed in any number of counterparts and by different 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 but one and the same agreement. Delivery of an executed counterpart of this Agreement by telefacsimile or other electronic means such as PDF shall be equally effective as delivery of an original executed counterpart of this Agreement.

SECTION 1.14.Upon the payment in full of Senior Indebtedness (other than unasserted contingent indemnification obligations and other similar contingent obligations not yet due and payable), this Agreement shall terminate and Administrative Agent shall promptly execute and deliver to each Payor and Payee such documents and instruments as shall be reasonably necessary to evidence such termination.

[Signature pages follow.]

P-4

IN WITNESS WHEREOF, the undersigned have executed and delivered this Agreement as of the date first written above.

CPI INTERNATIONAL ACQUISITION, INC.
By:
	Name:
	Title:
CPI INTERNATIONAL HOLDING CORP.
By:
	Name:
	Title:
[SUBSIDIARIES]
By:
	Name:
	Title:
UBS AG, STAMFORD BRANCH, as Administrative Agent
By:
	Name:
	Title:
By:
	Name:
	Title:

P-5

EXHIBIT Q

[Form of]
NON-BANK CERTIFICATE

Reference is made to the Credit Agreement dated as of February 11, 2011 (as amended, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”) among CPI INTERNATIONAL ACQUISITION, INC. (f/k/a CATALYST HOLDINGS, INC.), a Delaware corporation (“Borrower”), CPI INTERNATIONAL HOLDING CORP. (f/k/a CATALYST HOLDINGS 2, INC.), a Delaware corporation (“Holdings”), the Subsidiary Guarantors party thereto, the Lenders, UBS LOAN FINANCE LLC, as swingline lender (in such capacity, “Swingline Lender”), and UBS AG, STAMFORD BRANCH, as issuing bank (in such capacity, “Issuing Bank”), as administrative agent (in such capacity, “Administrative Agent”) for the Lenders and as collateral agent (in such capacity, “Collateral Agent”) for the Secured Parties and the Issuing Bank.

The undersigned is not (i) a bank (as such term is used in Section 881(c)(3)(A) of the Internal Revenue Code of 1986, as amended (the “Code”)), (ii) a “10 percent shareholder” of Borrower within the meaning of section 881(c)(3)(B) of the Code, or (iii) a “controlled foreign corporation” described in section 881(c)(3)(C) of the Code and that (iv) no interest payments in connection with the Loan Documents are effectively connected with the undersigned’s conduct of a U.S. trade or business.

	[NAME OF LENDER]
	By:
		Name:
		Title:
	[ADDRESS]
Dated:                  , 20

Q-1

Schedule 1.01(b)

Subsidiary Guarantors

Communications & Power Industries LLC

CPI Econco Division

CPI Malibu Division

CPI Subsidiary Holdings LLC

Communications & Power Industries International Inc.

Communications & Power Industries Asia Inc.

Schedule 1.01(c)

Existing Letters of Credit

UBS reference	Pricing Option	Facility/Borrower	Current Amount		CCY	Effective Date	Actual Expiry Date
WALI-A02153-1MON	Standby letter of credit	18359 / Communication and Power Industries, Inc.	$	561,600.00	USD	1/16/2008	7/30/2011
WALI-A02713-1MON	Standby letter of credit	41449 / Communication and Power Industries, Inc.	$	205,250.00	USD	10/30/2008	12/31/2011
WALI-A03032-1POZ	Standby letter of credit	18359 / Communication and Power Industries, Inc.	$	840,000.00	USD	3/31/2009	12/31/2011
WALI-A03077-1MON	Standby letter of credit	18359 / Communication and Power Industries, Inc.	$	59,045.00	USD	4/16/2009	2/15/2011
WALI-A03146-1MON	Standby letter of credit	41449 / Communication and Power Industries, Inc.	$	1,026,250.00	USD	6/02/2009	2/15/2011
WALI-A03635-1MON	Standby letter of credit	18359 / Communication and Power Industries, Inc.	$	199,440.00	USD	3/10/2010	3/10/2011
WALI-A03643-1POZ	Standby letter of credit	18359 / Communication and Power Industries, Inc.	$	24,075.00	USD	3/17/2010	8/1/2011
WALI-A03917-1MON	Standby letter of credit	18359 / Communication and Power Industries, Inc.	$	3,600.00	USD	8/10/2010	5/15/2011
WALI-F033898	Standby letter of credit	18359 / Communication and Power Industries, Inc.	$	1,250,000.00	USD	2/2/2004	4/1/2011
WALI-Y034035	Standby letter of credit	18359 / Communication and Power Industries, Inc.	$	360,000.00	USD	3/8/2004	7/16/2011

Schedule 3.03

Governmental Approvals; Compliance with Laws

None.

Schedule 3.06(a)

Challenges to Validity or Effectiveness

None.

Schedule 3.06(c)

Violations or Proceedings

None.

Schedule 3.07(c)

Organizational Chart

See attached.

Schedule 3.15

Labor Matters

None.

Schedule 3.18

Environmental Matters

None.

Schedule 3.19

Insurance

See attached.

Schedule 3.21

Merger Documents

(i)

Company Disclosure Letter, dated as of November 24, 2010, delivered by the Acquired Business to Borrower.

Parent Disclosure Letter, dated as of November 24, 2010, delivered by Borrower to the Acquired Business.

Voting Agreement, dated as of November 24, 2010, by and among Borrower and the stockholders named therein.

Certificate of Incorporation of the Surviving Corporation (as defined in the Merger Agreement).

(ii)

Bringdown Certificate delivered by the Acquired Business to Borrower pursuant to Sections 8.3(a) and (b) of the Merger Agreement.

Bringdown Certificate delivered by Borrower to the Acquired Business pursuant to Sections 8.2(a) and (b) of the Merger Agreement.

Schedule 3.23

Customs, International Trade and OFAC Disclosures

On December 9, 2010, the Acquired Business submitted an initial voluntary disclosure to OFAC reporting that the Cham, Switzerland office (“CPII Switzerland”) of the Acquired Business’ indirectly wholly owned subsidiary, Communications & Power Industries International Inc. (“CPII”), a Delaware corporation and a U.S. person, was involved in the sale to a customer in Iran of medical equipment manufactured by the Acquired Business’ Canadian subsidiary (“CPI Canada”).  The medical equipment consisted of CMP200 and Indico 100 medical X-ray generators (collectively referred to as “X-ray generators”), an Automatic Exposure Control (“AEC”) option, a CMP200DR X-ray generator (part of the CMP200 series) and a medical digital imaging workstation (including an AEC) (part of the RadVision system).  The X-ray generators and RadVision system are classified as medical devices by Health Canada and the U.S. Food & Drug Administration and are specially designed for medical end use.  Each of these products is classified by the U.S. Department of Commerce — Bureau of Industry and Security (“BIS”) as EAR99.  A final report in connection with the December 9, 2010 disclosure was filed with OFAC on January 28, 2011.

The disclosures reported that between 2005 and 2010, CPII Switzerland marketed, booked, and processed transactions involving a customer in Iran in violation of 31 C.F.R. § 560.208, which prohibits United States persons from facilitating transactions with Iran without a license.  In addition, the final report disclosed that the products were purchased from CPI Canada by CPII Switzerland, and sold to the buyer in Iran in violation of 31 C.F.R. § 560.204.

During the five-year review period, there was a total of 26 orders totaling approximately $2,153,153 (including freight and delivery charges) to the Iranian customer.  This number includes sales of 232 X-ray generators, a transaction involving an additional two components of a RadVision digital imaging system, and (as discussed below) 15 generators sold to a customer in Turkey.  Of the 26 orders, 25 were to the Iranian customer for resale to health care providers located in Iran.  The remaining order was initiated by the Iranian customer for 20 X-ray generators.  At the Iranian customer’s request, it received 5 of the generators, and the balance (15 generators) was sold and shipped to an affiliated company located in Turkey for resale to health care providers in Turkey.  CPII Switzerland invoiced and received payment from the Turkish company for the 15 X-ray generators.

From fiscal year 2006 through December 2010, approximately 77 X-ray generators were sold and shipped to the Turkish company.  A review of the export paperwork for the most recent shipment, in December 2010, identifies the Country of Ultimate Destination as Turkey, and states that the generators were sold to CPII Switzerland and shipped to the Turkish company in Turkey.  CPI Canada advises that all sales to the Turkish customer during the five year review period were sold to CPII Switzerland and shipped to the Turkish customer in Turkey.  The Acquired Business is continuing to review its sales records to the Turkish company.

As noted above, CPII Switzerland marketed a CMP200DR X-ray generator and a medical digital imaging workstation to the Iranian purchaser, which are components of the RadVision system.

The value of the sale (exclusive of freight and delivery), was $25,635.  This sale is included within the sales described above.

The sales to Iran were marketed, booked and processed by CPII Switzerland in violation of 31 C.F.R. § 560.208.  The products were purchased from CPI Canada by CPII Switzerland, which then sold the products to the buyer in Iran.  The equipment was then exported by CPI Canada from Canada directly to Iran.  Thus, as a technical matter, the sales were not made by CPI Canada, but were entered in the name of CPII, and CPII Switzerland received payment from the buyers.  Because CPII is a U.S. person, CPII Switzerland’s sales of this equipment to buyers in Iran without a license also violated section 31 C.F.R. § 560.204 of the Iranian Transaction Regulations.

Separately, the disclosures also identified one transaction involving the repair and re-export of a U.S.-origin power supply used in the Acquired Business’ amplifiers for a customer in Syria.  This transaction was arranged by CPII Switzerland and carried out by the branch office of Communications & Power Industries Europe Limited (“CPI Europe”), located in the Netherlands (“CPI Netherlands”).  The amplifier was originally exported to Syria without the Acquired Business’ knowledge.  The transaction also involved the export of a circuit breaker by a division of the Acquired Business located in Palo Alto, California, for use in the repair.  The facilitation of this transaction, the export of the circuit breaker and the re-export of the power supply were in violation of Exec. Order No. 13,338, 3 C.F.R. 168 (2005).  A voluntary disclosure was also submitted to BIS on January 28, 2011 and received by BIS on February 1, 2011 respecting violations of the Export Administration Regulations associated with this transaction.

During all relevant periods the Acquired Business believed in good faith that it was operating in compliance with applicable regulations. The failure by the Acquired Business to obtain such license(s) during these periods was inadvertent.

The Acquired Business has also made voluntary disclosures with the U.S. Department of State’s Directorate of Defense Trade Controls (“DDTC”) relating to potential violations of the International Traffic in Arms Regulations on October 14, 2003,  January 1, 2004, May 21, 2004, August 30, 2004, August 1, 2005, July 17, 2006, January 4, 2007, October 31, 2007, April 18, 2008, September 4, 2008, October 22, 2008, November 11, 2008, August 24, 2009, August 26, 2009 and March 11, 2010. All of the above-mentioned voluntary disclosures with DDTC have been closed without any action.

The Acquired Business made an initial voluntary disclosure with the Office of Anti-Boycott Compliance (“OAC”) on September 22, 2010 relating to the potential violations of the antiboycott regulations administered by OAC.   The Acquired Business submitted its final report to OAC on December 31, 2010.  The potential violations involve the acceptance by CPII Switzerland of purchase orders that contained boycott language with respect to sales of power tetrodes to Saudi Arabia.  Although the purchase orders including the boycott language were accepted, no action was ever taken by CPII or by CPII Switzerland to comply with, further or support the boycott of Israel.

Schedule 4.01(g)

Local Counsel

McKenna Long & Aldridge LLP (California)

Wilmer Cutler Pickering Hale and Dorr LLP (Massachusetts)

Schedule 4.01(m)(iii)

Title Insurance Amount

1.Title Policy for the Mortgaged Property located in Palo Alto, CA:    $44,408,451

2.Title Policy for the Mortgaged Property located in Beverly, MA:      $8,848,100

Schedule 5.13

Locations

None.

Schedule 5.16

Post-Closing Matters

Within five Business Days after the Closing Date, Borrower shall deliver to the Administrative Agent a stock certificate of Malibu Research Associates PTY Limited, evidencing 6 shares of ordinary stock owned by CPI Malibu Division, accompanied by a stock power undated and endorsed in blank.

Within five Business Days after the Closing Date, Borrower shall deliver to the Administrative Agent a stock certificate of 3251300 Nova Scotia Corporation, evidencing 65 shares of ordinary stock owned by CPI International, Inc., accompanied by a stock power undated and endorsed in blank.

Within ten Business Days after the Closing Date, Borrower and Administrative Agent shall obtain the written acknowledgment of Wells Fargo Bank, National Association, with respect to termination of (i) the Restricted Account Agreement, dated August 10, 2007, by and among Communications & Power Industries, Inc., Wells Fargo Bank, National Association and UBS AG, Stamford Branch, as collateral agent for the secured parties, (ii) the Restricted Account Agreement, dated August 10, 2007, by and among CPI Econco Division (f/k/a Econco Broadcast Service, Inc.), Wells Fargo Bank, National Association and UBS AG, Stamford Branch, as collateral agent for the secured parties, (iii) the Restricted Account Agreement, dated August 10, 2007, by and among CPI International, Inc., Wells Fargo Bank, National Association and UBS AG, Stamford Branch, as collateral agent for the secured parties, and (iv) the Restricted Account Agreement, dated April 2, 2008, by and among CPI Malibu Division (f/k/a Malibu Research Associates, Inc.), Wells Fargo Bank, National Association and UBS AG, Stamford Branch, as collateral agent for the secured parties.

Schedule 6.01(b)

Existing Indebtedness

None.

Schedule 6.02(c)

Existing Liens

None.

Schedule 6.04(b)

Existing Investments

Communications & Power Industries LLC owns shares in nine mutual funds that were purchased to hedge the non-qualified deferred compensation plan liability.  As of January 31, 2011, the value of the mutual funds was $118,817.86.

Schedule 6.04(l)

Closing Date Foreign Investments

Current Legal Entities Owned	Record Owner	No. Shares/Interest	Authorized Shares
Malibu Research Associates PTY Limited	CPI Malibu Division	10 shares of ordinary stock	10 shares of ordinary stock
Communications & Power Industries Italia S.r.L.	CPI Subsidiary Holdings LLC	100% ownership interests	N/A
Communications & Power Industries Europe Limited	CPI Subsidiary Holdings LLC	155,612 shares of ordinary stock	200,000 shares of ordinary stock
3215300 Nova Scotia Company	CPI International Acquisition, Inc.	100 shares of common stock	Unlimited common stock
Communications & Power Industries Australia PTY Limited	CPI Subsidiary Holdings LLC	60,011 shares of ordinary stock	60,012 shares of ordinary stock
Communications & Power Industries Australia PTY Limited	Communications & Power Industries LLC	1 share of ordinary stock	60,012 shares of ordinary stock

Schedule 6.05(f)

Contemplated Transactions

The Acquired Business shall be converted to a limited liability company and liquidated on or immediately after the Closing Date (and the Borrower shall deliver evidence of such transactions to the Administrative Agent).

Schedule 6.10(c)

Contemplated Modifications of Organizational Documents

Termination of the organizational documents of the Acquired Business in order to reflect its liquidation on or immediately after the Closing Date.

Modification of the organizational documents of Borrower in order to reflect its name change to CPI International, Inc. on or immediately after the Closing Date.

Schedule 6.14

Business of Holdings

None.

EX-10.2

Exhibit 10.2

EXECUTION COPY

ADVISORY AGREEMENT

THIS ADVISORY AGREEMENT (this “Agreement”) made this 11th day of February, 2011, by and between CPI International, Inc. (f/k/a CPI International Acquisition, Inc., f/k/a Catalyst Holdings, Inc.), a Delaware corporation (“Parent”) and Veritas Capital Fund Management, L.L.C., a Delaware limited liability company (“Advisor”).  Capitalized terms used but not defined herein shall have the respective meanings ascribed to them in the Amended and Restated Limited Liability Company Agreement of CPI International Holding LLC (f/k/a Catalyst Holdings LLC), a Delaware limited liability company (“Holdings”), dated as of the date hereof, among the parties thereto, as the same may be amended or modified from time to time (the “Holdings LLC Agreement”).

W I T N E S S E T H:

WHEREAS, Parent, Catalyst Acquisition, Inc., a Delaware corporation (“Merger Sub”), and CPI International, Inc., a Delaware corporation (“CPI”), each entered into that certain Merger Agreement, dated as of November 24, 2010 (the “Merger Agreement”), pursuant to which Parent acquired the Company by means of a merger of Merger Sub with and into CPI, with CPI surviving the merger (the “Merger”).

WHEREAS, one or more Affiliates (as defined below) of Advisor are members of Holdings;

WHEREAS, as of the date hereof, Holdings owns, directly or indirectly, all of the outstanding capital stock of Parent;

WHEREAS, Advisor used its expertise to provide substantial financial and structural analysis, due diligence investigations, corporate strategy and other advice and assistance in connection with the transactions contemplated by the Merger Agreement; and

WHEREAS, in connection with and following the consummation of the transactions contemplated by the Merger Agreement, Parent desires to retain Advisor to provide business and organizational strategy, financial and advisory services to Parent and its direct and indirect subsidiaries upon the terms and conditions hereinafter set forth, and Advisor is willing to undertake such obligations.

NOW, THEREFORE, in consideration of the mutual covenants and agreements hereinafter set forth, the parties hereby agree as follows:

1.Appointment.  Parent hereby engages Advisor, and Advisor hereby agrees, upon the terms and subject to the conditions set forth herein, to provide certain services to Parent and its direct and indirect subsidiaries as described in Section 3 hereof.

2.Term.

(a)Except as otherwise expressly provided in this Agreement, the term of this Agreement (the “Term”) shall be for an initial term commencing on the date hereof and expiring December 31, 2023.  Such term shall be renewed automatically for additional one-year terms thereafter unless (x) Advisor or Parent gives notice in writing to the other party hereto, within thirty days before the expiration of the initial term or any one-year renewal thereof, of its desire to terminate this Agreement or (y) this Agreement is earlier terminated pursuant to Section 2(c).

(b)The provisions of this Section 2, Section 5, and Sections 7 through 17 shall survive the termination of this Agreement and, subject to the terms and conditions of this Agreement, termination shall not impair the right of any party (a) to any Advisory Fees or Transaction Fees earned prior to such termination to the extent such fees are not paid in full prior to such termination or (b) to reimbursement of Expenses to the extent incurred in accordance with this Agreement prior to such termination and not reimbursed in full prior to such termination.

(c)Notwithstanding anything to the contrary in this Agreement, immediately prior to the consummation of a Change of Control or an IPO, Parent may terminate this Agreement by:

(1)giving notice in writing to Advisor of Parent’s desire to terminate this Agreement and

(2)paying (or causing to be paid) in cash to Advisor, (a) all unpaid Advisory Fees due to Advisor pursuant to Section 4(b), (b) all unpaid Transaction Fees due to Advisor pursuant to Section 4(c), (c) all Expenses due to Advisor under Section 4(d) with respect to the performance of Services prior to the termination date, and (d) the net present value (using a discount rate equal to the yield as of such termination date on U.S. Treasury securities of like maturity based on the times such payments would have been due) of the Advisory Fees that would have been payable to Advisor (calculated in accordance with Section 4(b)) with respect to the period from the termination date through December 31, 2023, or, if terminated following December 31, 2023, through the first anniversary of the date hereof occurring after the termination date.

2

The payments required to be made pursuant to Section 2(c)(2)(d) shall be paid by wire transfer of immediately available funds immediately prior to consummation of a Change of Control or an IPO (or such other date as mutually agreed among the parties to this Agreement) and shall be deemed a termination fee to be paid in lieu of ongoing payment of the Advisory Fees, Transaction Fees and Expenses and the provision of services hereunder and, following the payments required to be made pursuant to the preceding sentence, the obligations of Advisor to provide any services hereunder, and the corresponding obligations of Parent to pay the Advisory Fees, Transaction Fees and Expenses hereunder, shall be terminated, but all other provisions of this Agreement shall continue unaffected.

3.Duties of Advisor.  Advisor shall provide, or cause to be provided, Parent and its direct and indirect subsidiaries with such management, advisory and consulting services for Parent and its direct and indirect subsidiaries as mutually agreed by Advisor and Parent (acting through its board of directors (or equivalent thereof)) (such services, collectively, the “Services”).  The Services may include, without limitation, business and organizational strategy, financial and advisory services.  The fees and other compensation specified in this Agreement will be payable by Parent regardless of the extent of the Services requested by Parent pursuant to this Agreement, and regardless of whether or not Parent requests Advisor to provide any Services.

3.1Exclusions from the Services.  Notwithstanding anything in the foregoing to the contrary, the following services are specifically excluded from the definition of Services:

(a)Independent Accounting Services.  Accounting services rendered to Parent or its direct or indirect subsidiaries, or to Advisor with respect to Parent or its direct or indirect subsidiaries, with prior notice and consultation with the management of Parent, by an independent accounting firm or accountant (i.e., an accountant who is not an employee of Advisor or any of its Affiliates);

(b)Legal Services.  Legal services rendered to Parent or its direct or indirect subsidiaries, or to Advisor with respect to Parent or its direct or indirect subsidiaries, with prior notice and consultation with the management of Parent, by an independent law firm or attorney (i.e., an attorney who is not an employee of Advisor or any of its Affiliates); and

(c)Independent Actuarial Services.  Actuarial services rendered to Parent or its direct or indirect subsidiaries, or to Advisor with respect to Parent or its direct or indirect subsidiaries, with prior notice and consultation with the management of Parent, by an independent actuarial firm or actuary (i.e., an actuary who is not an employee of Advisor or any of its Affiliates).

3

Nothing herein shall prevent Parent from separately engaging Advisor or any of its Affiliates to provide investment banking or other financial advisory services for additional compensation on terms approved by Parent (acting through its board of directors (or an equivalent thereof)).

3.2Definition of Affiliate.  “Affiliate” shall mean, with respect to any specified individual, corporation, limited liability company, partnership, association, trust or other entity or organization (each, a “Person”), a Person that directly, or indirectly through one or more intermediaries, controls, is controlled by or is under common control with, such specified Person (it being understood that a Person shall be deemed to “control” another Person, for purposes of this definition, if such Person directly or indirectly has the power to direct or cause the direction of the management and policies of such other Person, whether through holding beneficial ownership interests in such other Person, through contracts or otherwise). For the purposes of this Agreement, neither Holdings nor any of its Subsidiaries shall constitute (or be deemed to constitute) an Affiliate of Advisor.

4.Compensation and Reimbursement.

(a)Merger Fee.  As consideration for the services provided by Advisor in connection with the Merger and the financing related thereto (which services included, but were not limited to, structural analysis, due diligence investigations, corporate strategy, financial advisory services and corporate structure review) (the “Initial Services”), Parent shall pay in cash to Advisor a transaction fee (the “Merger Fee”) in an aggregate amount equal to $9,000,000, earned and payable on the date hereof concurrently with the Closing.

(b)Annual Advisory Fee.  As consideration for providing the Services to Parent and its direct and indirect subsidiaries, subject to Section 2(c), in respect of each fiscal year, including fiscal year 2011, Parent shall pay in cash to Advisor an annual advisory fee (the “Advisory Fee”) in an aggregate amount equal to the greater of (i) $1,000,000 and (ii) 3.0% of Consolidated EBITDA (as defined in the Credit Agreement, as the same may be amended from time to time) for the prior fiscal year (the “Formula Amount”), due and payable in advance on each anniversary of the date hereof or if such date is not a Business Day, the next Business Day (each, a “Payment Date”); provided that for purposes of the calculation and payment of the Advisory Fee due and payable in respect of each fiscal year, (1) Parent shall pay Advisor an amount in cash equal to $1,000,000 on the applicable Payment Date (the “Estimated Payment”) and (2) upon the completion of the preparation of annual consolidated financial statements of Parent in respect of the applicable prior fiscal year, Parent will promptly deliver to Advisor a statement setting forth the actual Advisory Fee payable in respect of such fiscal year taking into account the Consolidated EBITDA for such fiscal year as reflected on such financial statements (the “Actual Amount”) and the amount (if any) by which the Estimated Payment is less than the Actual Amount, and pay Advisor in cash the amount of such shortfall; and provided further that the Payment Date for the Estimated Payment in respect of fiscal year 2011 shall be the date hereof, concurrently with the Closing.  Such payments, to the extent not timely paid (but, for the avoidance of doubt, such payments shall be made to the extent permitted under the Financing Documents), shall accrue interest at the per annum rate of 10.0%, compounded quarterly, from

4

the date due until the date of payment.  For purposes hereof, (x) “Business Day” shall mean any day other than a Saturday, a Sunday or a day on which commercial banks in New York, New York are required or authorized to be closed, and (y) “Financing Documents” means those definitive agreements entered into by Parent, Holdings and/or any of their respective subsidiaries in connection with the Debt Financing (as defined in the Merger Agreement), as the same may be amended, restated, amended and restated, extended, supplemented or otherwise modified or refinanced from time to time, including, without limitation, (i) the Credit Agreement, dated as of the date hereof, among Parent, Holding Corp., the subsidiary guarantors signatory thereto, the lenders signatory thereto, UBS Securities LLC, as the sole lead arranger and as the sole lead bookrunner, Bank of the West and GE Capital Financial Inc., as co-documentation agents, KKR Capital Markets LLC, as syndication agent, UBS Loan Finance LLC, as swingline lender, and UBS AG, Stamford Branch, as issuing bank, as administrative agent for the lenders and as collateral agent, (ii) the Indenture, dated as of the date hereof, among Parent, Holding Corp. and The Bank of New York Trust Company, N.A., as Trustee, and (iii) the First Supplemental Indenture, dated as of the date hereof, among Parent and the additional guarantors signatory thereto.

(c)Transaction Fees.  In connection with any transaction in which Parent, Holdings or any of their respective direct or indirect subsidiaries may be involved in the future (each, a “Transaction”) (including, without limitation, acquisitions, mergers, sales or dispositions of assets or equity interests, financings (including additional equity investments in Parent, Holdings or any of their respective direct or indirect subsidiaries whether through private placement, primary offerings, secondary offerings or otherwise), full or partial recapitalizations, structural reorganizations (including any divestiture of one or more subsidiaries or operating divisions of Parent, Holdings or any of their respective direct or indirect subsidiaries), reorganization of the equity interests or other ownership structure of Parent, Holdings or any of their respective direct or indirect subsidiaries, liquidity events or any other similar transaction), subject to Section 2(c), Parent shall pay to Advisor concurrently with the consummation of the applicable Transaction an aggregate fee (a “Transaction Fee”) as follows:

(1)with respect to any Transaction in the form of a debt and/or equity financing (it being understood that if a series of related Transactions are being effected, only the Transaction(s) that are in the form of a debt and/or equity financing shall be governed by this clause (1) and the other related Transaction(s) shall be governed by clause (2) below, and the references to Transaction Value in clause (1) shall mean the Transaction Value directly resulting from such debt and/or equity financing and the reference to Transaction Value in clause (2) shall mean any remaining Transaction Value directly resulting from the other related Transaction(s) not governed by this clause (1) without duplication of any Transaction Value taken into account for purposes of clause (1)):

(A)if Advisor or one of its Affiliates provides debt or equity financing (or any commitment to provide such financing) in connection

5

therewith, a fee in an aggregate amount equal to the greater of (i) $500,000, and 2.0% of the Transaction Value; and

(B)if none of Advisor nor any Affiliate of Advisor provides debt or equity financing (or any commitment to provide such financing) in connection therewith, a fee in an aggregate amount equal to the greater of (i) $500,000, and 2.0% of the Transaction Value;

(2)with respect to any other form of Transaction, a fee in an aggregate amount equal to the greater of (i) $500,000, and 2.0% of the Transaction Value.

For purposes hereof, “Transaction Value” means the total value of the applicable Transaction, including, without limitation, the aggregate amount of the cash funds and the aggregate value of the other securities or obligations required to complete the Transaction (excluding any fees payable pursuant to this Section 4(c)), including any indebtedness, guarantees, capital stock or similar items issued or made to facilitate, and the amount of any revolving credit or other liquidity facilities or arrangements established in connection with, such Transaction or assumed, refinanced or left outstanding in connection with or immediately following such Transaction (it being understood and agreed that with respect to any Transaction in the form of the issuance or sale of securities of Parent or Holdings or of any direct or indirect subsidiary of Parent or Holdings, the Transaction Value shall be deemed to be the aggregate amount of gross proceeds raised in such Transaction).  For purposes of calculating a Transaction Fee, the value of any securities included in the Transaction Value will be determined by the average of the last sales prices for such securities on the five trading days ending five days prior to the consummation of the applicable Transaction, provided that if such securities do not have an existing public trading market, the value of the securities shall be their fair market value as mutually and reasonably agreed to between Advisor and Parent on the day prior to consummation of such Transaction.

Such payments, to the extent not timely paid (but, for the avoidance of doubt, such payments shall be made to the extent permitted under the Financing Documents), shall accrue interest at the per annum rate of 10.0%, compounded quarterly, from the date due until the date of payment. No Transaction Fee (other than the Merger Fee pursuant to Section 4(a)) shall be payable to Advisor in respect of the Initial Services.

(d)Out of Pocket Expenses.  In addition to any fees payable to Advisor pursuant to this Agreement, Parent shall, or shall cause one or more of its Affiliates to, at the direction of such Advisor, pay directly or reimburse such Advisor or any of its Affiliates, from time to time upon request, for any Expenses (as hereinafter defined) incurred in connection with the Services provided for in Section 3 hereof.  For purposes of this Agreement, the term “Expenses” shall mean the reasonable amounts paid by Advisor or any of its Affiliates in connection with the Services provided for in Section 3 (including without limitation in connection with the services specifically excluded from the definition of Services pursuant to

6

Section 3.1 hereof), any requested amendment or waiver of any agreement between Advisor and its Affiliates that own an equity interest in Holdings and the sale or disposition by such Affiliate or Advisor of its equity interests in Holdings, including without limitation (i) fees and disbursements of any independent professionals and organizations, including independent auditors and outside legal counsel, investment bankers or other financial advisors or consultants, (ii) costs of any outside services of independent contractors such as financial printers, couriers, business publications or similar services and (iii) transportation, per diem, telephone calls, entertainment and all other reasonable expenses actually incurred by Advisor or any of its Affiliates in rendering the Services provided for herein.  All reimbursements for Expenses shall be made promptly upon or as soon as practicable after presentation by Advisor to Parent of the statement in connection therewith.  Nothing in this Section 4 shall limit any obligations of Holdings to reimburse any costs and expenses to Advisor or its Affiliates as provided in the Holdings LLC Agreement.

5.Indemnification.

(a)Parent shall indemnify and hold harmless, to the fullest extent permitted by law, Advisor and its managers, officers, directors, employees, members, partners, stockholders, agents, representatives, Affiliates and controlling persons (if any) (each being an “Indemnified Party”) from and against any and all losses, claims, damages and liabilities, joint or several (the “Liabilities”), to which such Indemnified Party may become subject under any applicable federal or state law, any claim made by any third party or otherwise, relating to or arising out of the Services contemplated by this Agreement or the engagement of Advisor pursuant to, and the performance by Advisor or such Indemnified Party of the Services, and Parent will reimburse any Indemnified Party for all costs and expenses (including without limitation reasonable attorneys’ fees and expenses) as they are incurred in connection with the investigation of, preparation for or defense of any pending or threatened claim, or any action or proceeding arising therefrom, whether or not such Indemnified Party is a party thereto.  Parent will not be liable under the foregoing reimbursement and indemnification provision to the extent that any loss, claim, damage, liability, cost or expense is determined by a court, in a final judgment from which no further appeal may be taken, to have resulted solely from the gross negligence, willful misconduct or bad faith of the Indemnified Party.  The reimbursement and indemnity obligations of Parent under this Section 5 shall be in addition to any liability which Parent may otherwise have, shall extend upon the same terms and conditions to any Affiliate of Advisor and the managers, stockholders, officers, directors, employees, members, partners, agents, representatives, Affiliates and controlling persons (if any), as the case may be, of Advisor and any such Affiliate.  The provisions of this Section 5 are intended to be for the benefit of, shall be binding upon and shall be enforceable by each Indemnified Party and its or their successors, assigns, heirs and personal representatives of Parent, Advisor, any such Affiliate and any such person.

(b)If such indemnification is for any reason not available or insufficient to hold an Indemnified Party harmless, Parent agrees to contribute to the Liabilities involved in such proportion as is appropriate to reflect the relative benefits received (or anticipated to be

7

received) by Parent and its subsidiaries (as applicable), on the one hand, and by Advisor, on the other hand, with respect to the Services or, if such allocation is determined by a court or arbitral tribunal to be unavailable, in such proportion as is appropriate to reflect other equitable considerations such as the relative fault of Parent, on the one hand, and of Advisor, on the other hand; provided, however, that to the extent permitted by applicable law, the Indemnified Parties shall not be responsible for amounts which in the aggregate are in excess of the amount of all fees actually received by Advisor from Parent with respect to the Services.  Relative benefits to Parent and its subsidiaries (as applicable), on the one hand, and to Advisor, on the other hand, with respect to the Services shall be deemed to be in the same proportion as (i) the total value received or proposed to be received by Parent and its subsidiaries (as applicable) in connection with the Services or any transactions to which the Services relate bears to (ii) all fees actually received by Advisor in connection with the Services.  Relative fault shall be determined, in the case of Liabilities arising out of or based on any untrue statement or any alleged untrue statement of a material fact or omission or alleged omission to state a material fact, by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by, or on behalf of,  Parent to Advisor and the parties’ relative intent, knowledge, access to information and opportunity to correct or prevent such untrue statement or omission.  No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act of 1933, as amended) shall be entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.

(c)Upon receipt by an Indemnified Party of actual notice of any pending or threatened action, claim, suit, investigation or proceeding (each, an “Action”) against such Indemnified Party with respect to which indemnity may be sought under this Agreement, such Indemnified Party shall promptly notify Parent in writing; provided that failure to so notify Parent shall not relieve Parent from any liability which Parent may have on account of the indemnity provisions under this Agreement or otherwise, except to the extent Parent shall havebeen materially prejudiced by such failure.  Parent shall have the right to assume the defense of any such Action including the employment of counsel reasonably satisfactory to such Indemnified Party.  Any Indemnified Party shall have the right to employ separate counsel in any such action and participate in the defense thereof, but the fees and expenses of such counsel shall be at the expense of such Indemnified Party, unless:  (i) Parent has failed to assume the defense and employ counsel promptly or (ii) the named parties to any such Action (including any impleaded parties) include such Indemnified Party and Parent, and such Indemnified Party shall have been advised by counsel that there may be one or more legal defenses available to it which are different from or in addition to those available to Parent; provided that Parent shall not in such event be responsible hereunder for the fees and expenses of more than one firm of separate counsel in connection with any Action in the same jurisdiction, in addition to any local counsel.  Parent shall not, without the applicable Advisor’s prior written consent, settle, compromise, or consent to the entry of any judgment in or otherwise seek to terminate any Action in respect of which indemnification may be sought hereunder (whether or not any Indemnified Party is a party therein) unless Parent has given Advisor reasonable prior written notice thereof and such settlement, compromise, consent or termination includes an unconditional release of each Indemnified Party from any liabilities arising out of such Action.  Parent will not permit any such settlement, compromise, consent or termination to include a statement as to, or an

8

admission of, fault, culpability or a failure to act by or on behalf of an Indemnified Party, without such Indemnified Party’s prior written consent.  No Indemnified Party seeking indemnification, reimbursement or contribution under this Agreement will, without Parent’s prior written consent, settle, compromise, consent to the entry of any judgment in or otherwise seek to terminate any Action referred to herein.

(d)Parent’s obligations hereunder shall be in addition to any rights that any Indemnified Party may have under the Holdings LLC Agreement, the Registration Rights Agreement, dated the date hereof, among Holdings, CPI International Holding Corp. and the other parties thereto, at common law or otherwise, provided that Parent shall not be required to pay any amount under this Section 5 already paid to the indemnified party pursuant to the indemnification, exculpation and/or reimbursement provisions in the Holdings LLC Agreement.

(e)The provisions of this Section 5 and any modification thereof shall apply to the Services provided to Parent by Advisor (including related activities prior to the date hereof) and shall remain in full force and effect regardless of the completion or termination of this Agreement.  If any term, provision, covenant or restriction herein is held by a court of competent jurisdiction to be invalid, void or unenforceable or against public policy, the remainder of the terms, provisions and restrictions contained herein shall remain in full force and effect and shall in no way be affected, impaired or invalidated.

6.Distributions.  Parent shall cause its subsidiaries to distribute funds to Parent to the extent necessary for Parent to satisfy their obligations under this Agreement.

7.Independent Contractors.  Nothing herein shall be construed to create a joint venture or partnership between Advisor, on the one hand, and Parent, Holdings and/or any of their respective subsidiaries, on the other hand, or an employee/employer relationship.  In connection with the Services, Advisor is acting as an independent contractor and not in any other capacity pursuant to this Agreement, with duties owing solely to Parent.  Neither Advisor norParent shall have any express or implied right or authority to assume or create any obligations on behalf of or in the name of the other or to bind the other to any contract, agreement or undertaking with any third party.

8.Notices.  Any notice or other communications required or permitted to be given hereunder shall be in writing and delivered by hand or mailed by registered or certified mail, return receipt requested, or by telecopier to the party to whom it is to be given at its address set forth herein, or to such other address as the party shall have specified by notice similarly given and the mailing date shall be deemed the date from which all time periods pertaining to a date of notice shall run.

(i)If to Parent, to it at:

9

c/o Veritas Capital Fund Management, L.L.C.
590 Madison Avenue, 41st Floor
New York, New York 10022
Attention: Robert B. McKeon
Facsimile No.: (212) 688-9411
E-mail: rmckeon@veritascapital.com
with a copy to:
Skadden, Arps, Slate, Meagher & Flom LLP
Four Times Square
New York, New York 10036
Attention:	Eileen Nugent, Esq.
	Kenneth Wolff, Esq.
Facsimile No.:   (212) 735-2000
E-mail:	eileen.nugent@skadden.com
	kenneth.wolff@skadden.com

(ii)if to Advisor, to it at:

Veritas Capital Fund Management, L.L.C.
590 Madison Avenue, 41st Floor
New York, New York 10022
Attention: Robert B. McKeon
Facsimile No.: (212) 688-9411
E-mail: rmckeon@veritascapital.com
with a copy to:
Skadden, Arps, Slate, Meagher & Flom LLP
Four Times Square
New York, New York 10036
Attention:	Eileen Nugent, Esq.
	Kenneth Wolff, Esq.
Facsimile No.:   (212) 735-2000
E-mail:	eileen.nugent@skadden.com
	kenneth.wolff@skadden.com

9.Assignment.  This Agreement shall inure to the benefit of and be binding upon the parties and their successors and permitted assigns.  However, neither this Agreement nor any of the rights of the parties hereunder may be transferred or assigned by any party hereto, except that (i)  if Parent shall merge or consolidate with or into, or sell or otherwise transfer substantially all its assets to, another entity which assumes the obligations of Parent under this Agreement and which holds directly or indirectly all or substantially all the consolidated assets of Parent and its subsidiaries, Parent may assign its rights hereunder to that entity and (ii) Advisor may assign its rights and obligations hereunder to any Affiliate of Advisor.  Any attempted transfer or assignment in violation of this Section 9 shall be void.

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10.Permissible Activities.  Nothing herein shall in any way preclude Advisor, any of its Affiliates or any of their respective officers, directors, employees, members, partners, managers or stockholders from engaging in or investing in any business activities or from performing services for its or their own account or for the account of others, including companies which may be or are in competition with the business conducted by Parent or its direct or indirect subsidiaries.

11.Confidentiality.  Any advice or opinions provided by Advisor may not be disclosed or referred to publicly or to any third party (other than legal, tax, financial or other advisors of Parent, Holdings and each of their respective subsidiaries), except in accordance with Advisor’s prior written consent.

12.Amendment and Waiver.  No amendment or waiver of any provision of this Agreement, or consent to any departure by either party from any such provision, shall in any event be effective unless the same shall be in writing and signed by the parties to this Agreement.  The waiver of any party of any breach of this Agreement shall not operate or be construed to be a waiver of any subsequent breach.

13.Entire Agreement.  This Agreement contains the entire agreement between the parties hereto and supersedes all prior agreements and understandings, oral and written, among the parties hereto with respect to the subject matter hereof.

14.Section Headings.  The section headings contained herein are included for convenience of reference only and shall not constitute a part of this Agreement for any other purpose.

15.Applicable Law.  This Agreement and the rights and obligations of the parties hereunder shall be governed by, and construed and interpreted in accordance with, the internal laws of the State of New York.  Each of the parties hereto hereby irrevocably submits to the exclusive jurisdiction of any federal court sitting in the Southern District of New York over any suit, action or proceeding arising out of or relating to this Agreement.  Each of the parties hereto hereby irrevocably waives, to the fullest extent permitted or not prohibited by law, any objection which it may now or hereafter have to the laying of the venue of any such suit, action or proceeding brought in such a court and any claim that any such suit, action or proceeding brought in such a court has been brought in an inconvenient forum.  Each of the parties hereto hereby irrevocably consents to the service of process in any suit, action or proceeding by sending the same by certified mail, return receipt requested or by overnight courier service, to the address of such party set forth in Section 8 or in the records of Parent.  Each party hereto waives any right it may have to trial by jury in any action brought hereunder or arising out of the transactions contemplated hereby.

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16.Severability.  Any section, clause, sentence, provision, subparagraph or paragraph of this Agreement held by a court of competent jurisdiction to be invalid, illegal or ineffective shall not impair, invalidate or nullify the remainder of this Agreement, but the effect thereof shall be such section, clause, sentence, provision, subparagraph or paragraph so held to be invalid, illegal or ineffective.

17.Counterparts.  This Agreement may be executed in multiple counterparts, any one of which need not contain the signature of more than one party, but all such counterparts taken together shall constitute one and the same instrument.

[Remainder of Page Intentionally Left Blank]

12

IN WITNESS WHEREOF, the parties hereto have signed this Agreement as of the day and year first above written.

CPI INTERNATIONAL, INC.
By:	/s/ Robert A. Fickett
	Name:	Robert A. Fickett
	Title:	President
VERITAS CAPITAL FUND MANAGEMENT, L.L.C.
By:	/s/ Robert B. McKeon
	Name:	Robert B. McKeon
	Title:	President

[Signature Page to the Advisory Agreement]

EX-12.1

Exhibit 12.1

COMPUTATION OF RATIO OF EARNINGS TO FIXED CHARGES

	Historical Predecessor										Pro forma Parent
	Fiscal Year Ended October 3, 2008		Fiscal Year Ended October 2, 2009		Fiscal Year Ended October 1, 2010		Three Months EndedJanuary 1,2010		Three Months Ended December 31, 2010		Fiscal Year Ended October 1, 2010			Three Months Ended December 31, 2010
	(dollars in thousands)
Earnings calculation:
Income before taxes	$	31,253	$	23,248	$	12,361	$	5,751	$	3,177	$	(6,762	)	$	(1,637	)
Add Back: Fixed Charges	19,888		17,846		16,046		4,098		3,938		27,930			6,997
Calculated Earnings	$	51,141	$	41,094	$	28,407	$	9,849	$	7,115	$	21,168		$	5,360
Fixed charges calculation (a)
Interest expense (b)	$	19,055	$	16,979	$	15,213	$	3,881	$	3,711	$	27,097		$	6,770
Interest expense portion of rental expense	833		867		833		217		227		833			227
	$	19,888	$	17,846	$	16,046	$	4,098	$	3,938	$	27,930		$	6,997
Ratio: Earnings / Fixed charges	2.57		2.30		1.77		2.40		1.81				(c)			(c)

(a) Fixed charges exclude capitalized interest; capitalized interest is zero.

(b) Includes normal debt issue amortization costs, but does not include gain or loss on debt extinguishment.

(c) For the fiscal year ended October 1, 2010 and three months ended December 31, 2010, Parent pro forma earnings were not sufficient to cover fixed charges. Parent needed additional earnings of $6,762 and $1,637, respectively, to achieve a ratio of earni

Interest expense portion of rental expense:
Rental expense	2,500		2,600		2,500		650		680		2,500		680
Estimated Interest Cost	33	%	33	%	33	%	33	%	33	%	33	%	33	%
Calculated total	833		867		833		217		227		833		227

EX-21

Exhibit 21

CPI INTERNATIONAL HOLDING CORP.

SUBSIDIARIES

Direct Subsidiaries

Subsidiary	Jurisdiction of Organization
CPI International, Inc.	Delaware

Indirect Subsidiaries

Subsidiary	Jurisdiction of Organization	Direct Parent
Communications & Power Industries LLC	Delaware	CPI International, Inc.
3251300 Nova Scotia Company	Nova Scotia, Canada	CPI International, Inc.
Communications & Power Industries Canada Inc.	Ontario, Canada	3251300 Nova Scotia Company
CPI Subsidiary Holdings LLC	Delaware	Communications & Power Industries LLC
CPI Econco Division	California	Communications & Power Industries LLC
CPI Malibu Division	California	Communications & Power Industries LLC
Communications & Power Industries International Inc.	Delaware	CPI Subsidiary Holdings LLC
Communications & Power Industries Asia Inc.	Delaware	CPI Subsidiary Holdings LLC
Communications & Power Industries Europe Limited	England and Wales	CPI Subsidiary Holdings LLC
Communications & Power Industries Italia S.r.L.	Italy	CPI Subsidiary Holdings LLC
Communications & Power Industries Australia Pty Limited	Australia	CPI Subsidiary Holdings LLC

EX-23.2

Exhibit 23.2

Consent of Independent Registered Public Accounting Firm

The Board of Directors and Stockholders
CPI International, Inc.:

We consent to the use in this Registration Statement on Form S-4 of CPI International, Inc. and subsidiaries (CPI) of our report dated December 10, 2010, except as to note 15 and 16, as to which the date is April 7, 2011, with respect to the consolidated balance sheets of CPI International as of October 1, 2010 and October 2, 2009, and the related consolidated statements of income, stockholders’ equity and comprehensive income, and cash flows for each of the years in the three-year period ended October 1, 2010 and the effectiveness internal control over financial reporting, as of October 1, 2010 included hereinto the reference to our firm under the heading “Experts” in the prospectus.

(signed) KPMG LLP

Mountain View, California

April 7, 2011

EX-23.3

Exhibit 23.3

Consent of Independent Registered Public Accounting Firm

The Board of Directors and Stockholder
CPI International Holding Corp.:

We consent to the use in this Registration Statement on Form S-4 of CPI International, Inc. and subsidiaries (CPI) of our report dated April 7, 2011, with respect to the consolidated balance sheet  of CPI International Holding Corp. as of January 31, 2011  included herein and to the reference to our firm under the heading “Experts” in the prospectus.

(signed) KPMG LLP

Mountain View, California

April 7, 2011

EX-25.1

Exhibit 25.1

FORM T-1

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

STATEMENT OF ELIGIBILITY
UNDER THE TRUST INDENTURE ACT OF 1939 OF A
CORPORATION DESIGNATED TO ACT AS TRUSTEE

CHECK IF AN APPLICATION TO DETERMINE
ELIGIBILITY OF A TRUSTEE PURSUANT TO
SECTION 305(b)(2)       o

THE BANK OF NEW YORK TRUST COMPANY, N.A.

(Exact name of trustee as specified in its charter)

	95-3571558
(State of incorporation if not a U.S. national bank)	(I.R.S. employer identification no.)

700 South Flower Street Suite 500 Los Angeles, California	90017
(Address of principal executive offices)	(Zip code)

CPI International, Inc.

(Exact name of obligor as specified in its charter)

Delaware	80-0676283
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)

CPI International Holding Corp.

(Exact name of obligor as specified in its charter)

Delaware	90-0649687
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)

Communications & Power Industries LLC

(Exact name of obligor as specified in its charter)

Delaware	77-0405693
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)

CPI Subsidiary Holdings LLC

(Exact name of obligor as specified in its charter)

Delaware	77-0407397
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)

Communications & Power Industries International Inc.

(Exact name of obligor as specified in its charter)

Delaware	77-0407398
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)

Communications & Power Industries Asia Inc.

(Exact name of obligor as specified in its charter)

Delaware	77-0407400
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)

CPI Econco Division

(Exact name of obligor as specified in its charter)

California	94-1724783
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)

CPI Malibu Division

(Exact name of obligor as specified in its charter)

California	95-2979251
(State or other jurisdiction of incorporation or organization)	(I.R.S. employer identification no.)

811 Hansen Way Palo Alto, California	94303-1110
(Address of principal executive offices)	(Zip code)

8.00% Senior Notes due 2018
and Guarantees of 8.00% Senior Notes due 2018(Title of the indenture securities)

1.General information.  Furnish the following information as to the trustee:

(a)Name and address of each examining or supervising authority to which it is subject.

Name	Address
Comptroller of the Currency United States Department of the Treasury	Washington, D.C. 20219
Federal Reserve Bank	San Francisco, California 94105
Federal Deposit Insurance Corporation	Washington, D.C. 20429

(b) Whether it is authorized to exercise corporate trust powers.

Yes.

2. Affiliations with Obligor.

If the obligor is an affiliate of the trustee, describe each such affiliation.

None.

16. List of Exhibits.

Exhibits identified in parentheses below, on file with the Commission, are incorporated herein by reference as an exhibit hereto, pursuant to Rule 7a-29 under the Trust Indenture Act of 1939 (the “Act”) and 17 C.F.R. 229.10(d).

1.A copy of the articles of association of The Bank of New York Trust Company, N.A. (Exhibit 1 to Form T-1 filed with Registration Statement No. 333-121948).

2.A copy of certificate of authority of the trustee to commence business. (Exhibit 2 to Form T-1 filed with Registration Statement No. 333-121948).

3.A copy of the authorization of the trustee to exercise corporate trust powers. (Exhibit 3 to Form T-1 filed with Registration Statement No. 333-121948).

4.A copy of the existing by-laws of the trustee. (Exhibit 4 to Form T-1 filed with Registration Statement No. 333-121948).

6.The consent of the trustee required by Section 321(b) of the Act. (Exhibit 6 to Form T-1 filed with Registration Statement No. 333-121948).

7.A copy of the latest report of condition of the Trustee published pursuant to law or to the requirements of its supervising or examining authority.

3

SIGNATURE

Pursuant to the requirements of the Act, the trustee, The Bank of New York Trust Company, N.A., a banking association organized and existing under the laws of the United States of America, has duly caused this statement of eligibility to be signed on its behalf by the undersigned, thereunto duly authorized, all in The City of Los Angeles and State of California, on the 22nd day of March, 2011.

THE BANK OF NEW YORK TRUST COMPANY, N.A.
By:	/s/ MELONEE YOUNG
Name:		MELONEE YOUNG
Title:		VICE PRESIDENT

4

EXHIBIT 7

Consolidated Report of Condition of

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.

of 700 South Flower Street, Suite 200, Los Angeles, CA 90017

At the close of business December 31, 2010, published in accordance with Federal regulatory authority instructions.

	Dollar Amounts
	in Thousands
ASSETS
Cash and balances due from depository institutions:
Noninterest-bearing balances and currency and coin	2,000
Interest-bearing balances	151
Securities:
Held-to-maturity securities	7
Available-for-sale securities	754,025
Federal funds sold and securities purchased under agreements to resell:
Federal funds sold	70,300
Securities purchased under agreements to resell	0
Loans and lease financing receivables:
Loans and leases held for sale	0
Loans and leases, net of unearned income	0
LESS: Allowance for loan and lease losses	0
Loans and leases, net of unearned income and allowance	0
Trading assets	0
Premises and fixed assets (including capitalized leases)	9,168
Other real estate owned	0
Investments in unconsolidated subsidiaries and associated companies	1
Direct and indirect investments in real estate ventures	0
Intangible assets:
Goodwill	856,313
Other intangible assets	216,233
Other assets	159,872
Total assets	$	2,068,070

5

LIABILITIES
Deposits:
In domestic offices	500
Noninterest-bearing	500
Interest-bearing	0
Not applicable
Federal funds purchased and securities sold under agreements to repurchase:
Federal funds purchased	0
Securities sold under agreements to repurchase	0
Trading liabilities	0
Other borrowed money:
(includes mortgage indebtedness and obligations under capitalized leases)	268,691
Not applicable
Not applicable
Subordinated notes and debentures	0
Other liabilities	235,783
Total liabilities	504,974
Not applicable
EQUITY CAPITAL
Perpetual preferred stock and related surplus	0
Common stock	1,000
Surplus (exclude all surplus related to preferred stock)	1,121,520
Not available
Retained earnings	438,997
Accumulated other comprehensive income	1,579
Other equity capital components	0
Not available
Total bank equity capital	1,563,096
Noncontrolling (minority) interests in consolidated subsidiaries	0
Total equity capital	1,563,096
Total liabilities and equity capital	2,068,070

I, Karen Bayz, Managing Director of the above-named bank do hereby declare that the Reports of Condition and Income (including the supporting schedules) for this report date have been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and are true to the best of my knowledge and belief.

Karen Bayz ) Managing Director

We, the undersigned directors (trustees), attest to the correctness of the Report of Condition (including the supporting schedules) for this report date and declare that it has been examined by us and to the best of our knowledge and belief has been prepared in conformance with the instructions issued by the appropriate Federal regulatory authority and is true and correct.

Timothy Vara, President	)
Frank P. Sulzberger, MD	)	Directors (Trustees)
William D. Lindelof, MD	)

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EX-99.1

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Exhibit 99.1

CPI INTERNATIONAL, INC.

OFFER TO EXCHANGE

$215,000,000 aggregate principal amount of 8.00% Senior Notes
due 2018, which have been registered under the Securities Act of 1933, for any
and all outstanding 8.00% Senior Notes due 2018

        THE EXCHANGE OFFER WILL EXPIRE AT 5:00 P.M., NEW YORK CITY TIME, ON                        , 2011 (THE "EXPIRATION DATE") UNLESS THE OFFER IS EXTENDED, TENDERS MAY BE WITHDRAWN PRIOR TO 5:00 P.M., NEW YORK CITY TIME, ON                        , 2011. 

The Exchange Agent for the Exchange Offer is:

THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.

DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE, OR TRANSMISSION OF THIS LETTER OF TRANSMITTAL VIA FACSIMILE TRANSMISSION TO A NUMBER OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY. THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.

By Registered or Certified Mail:	By Facsimile:	By Overnight Courier or Hand:
The Bank of New York Mellon Trust Company, N.A. c/o The Bank of New York Mellon Corporation Corporate Trust—Reorganization Unit 480 Washington Boulevard, 27th Floor Jersey City, NJ 07310 (Attn: Ms. Diane Amoroso)	212-298-1915	The Bank of New York Mellon Trust Company, N.A. c/o The Bank of New York Mellon Corporation Corporate Trust Operations—Reorganization Unit 480 Washington Boulevard, 27th Floor Jersey City, NJ 07310 (Attn: Ms. Diane Amoroso)
	To Confirm by Telephone: 212-815-2742

        Holders of Outstanding Notes (as defined below) should complete this Letter of Transmittal either if Outstanding Notes are to be forwarded herewith or if tenders of Outstanding Notes are to be made by book-entry transfer to an account maintained by the Exchange Agent at the book-entry transfer facility specified by the holder pursuant to the procedures set forth in "The Exchange Offer—Book Entry Delivery Procedures" and "The Exchange Offer—Procedures for Tendering Outstanding Notes" in the Prospectus (as defined below) and an "Agent's Message" (as defined below) is not delivered. If tender is being made by book-entry transfer, the holder must have an Agent's Message delivered in lieu of this Letter of Transmittal.

        Holders of Outstanding Notes whose certificates for such Outstanding Notes are not immediately available or who cannot deliver their certificates and all other required documents to the Exchange Agent on or prior to the Expiration Date or who cannot complete the procedures for book-entry transfer on a timely basis, must tender their Outstanding Notes according to the guaranteed delivery procedures set forth in "The Exchange Offer—Procedures for Tendering Outstanding Notes" in the Prospectus.

        As used in this Letter of Transmittal, the term "holder" with respect to the Exchange Offer (as defined below) means any person in whose name Outstanding Notes are registered or any other person

1

who has obtained a properly completed bond power from the registered holder or the book-entry transfer facility whose name appears on the security listing as the owner of the Outstanding Notes.

        The undersigned acknowledges receipt of the Prospectus dated                        , 2011 (as it may be amended or supplemented from time to time, the "Prospectus") of CPI International, Inc., a Delaware corporation (the "Company"), CPI International Holding Corp., a Delaware corporation (the "Parent Guarantor"), and certain subsidiary guarantors of the Company (together with the Parent Guarantor, the "Guarantors"), and this Letter of Transmittal (the "Letter of Transmittal"), which together constitute the Company's offer (the "Exchange Offer") to exchange an aggregate principal amount of up to $215,000,000 of the Company's 8.00% Senior Notes due 2018, guaranteed by the Guarantors that were originally sold pursuant to a private offering (the "Outstanding Notes"), for an equal principal amount of the Company's 8.00% Senior Notes due 2018, guaranteed by the Guarantors, that have been registered under the Securities Act of 1933, as amended (the "Securities Act") (the "Exchange Notes"). The Outstanding Notes are unconditionally guaranteed (the "Old Guarantees") by the Guarantors and the Exchange Notes will be unconditionally guaranteed (the "New Guarantees") by the Guarantors. Upon the terms and subject to the conditions set forth in the Prospectus and the Letter of Transmittal, the Guarantors offer to issue the New Guarantees with respect to all Exchange Notes issued in the Exchange Offer in exchange for the Old Guarantees of the Outstanding Notes for which such Exchange Notes are issued in the Exchange Offer. Throughout this Letter of Transmittal, unless the context otherwise requires and whether so expressed or not, references to the "Exchange Offer" include the Guarantors' offer to exchange the New Guarantees for the Old Guarantees, references to the "Exchange Notes" include the related New Guarantees and references to the "Outstanding Notes" include the related Old Guarantees.

        For each Outstanding Note accepted for exchange, the holder of such Outstanding Note will receive an Exchange Note having a principal amount equal to that of the surrendered Outstanding Note. The Exchange Notes will accrue interest at a rate of 8.00% per annum commencing on August 15, 2011, payable on February 15 and August 15 of each year.

        Capitalized terms used but not defined herein shall have the same meaning given them in the Prospectus.

        YOUR BANK OR BROKER CAN ASSIST YOU IN COMPLETING THIS FORM. THE INSTRUCTIONS INCLUDED WITH THIS LETTER OF TRANSMITTAL MUST BE FOLLOWED. QUESTIONS AND REQUESTS FOR ASSISTANCE OR FOR ADDITIONAL COPIES OF THE PROSPECTUS AND THIS LETTER OF TRANSMITTAL MAY BE DIRECTED TO THE EXCHANGE AGENT, WHOSE ADDRESS AND TELEPHONE NUMBER APPEAR ON THE FRONT PAGE OF THIS LETTER OF TRANSMITTAL.

        The undersigned has completed the appropriate boxes below and signed this Letter of Transmittal to indicate the action that the undersigned desires to take with respect to the Exchange Offer.

PLEASE READ THE ENTIRE LETTER OF TRANSMITTAL AND THE PROSPECTUS
CAREFULLY BEFORE CHECKING ANY BOX BELOW.

        List below the Outstanding Notes to which this Letter of Transmittal relates. If the space provided below is inadequate, the certificate numbers and aggregate principal amounts of Original Notes should be listed on a separate signed schedule affixed hereto.

2

All Tendering Holders Complete Box 1:
Box 1*
Description of Outstanding Notes Tendered Herewith

Name(s) and Address(es) of
Registered Holder(s)
(Please fill in, if blank,
exactly as name(s) appear(s) on Certificate(s))
Certificate or
Registration
Number(s)
of Outstanding
Notes**
Aggregate Principal
Amount
Represented
by Outstanding Notes
Aggregate Principal
Amount of
Outstanding Notes
Being Tendered***

*

If the space provided is not adequate, list the certificate numbers and principal amount of Outstanding Notes on a separate signed schedule and attach the list to this Letter of Transmittal.

**

Need not be completed by book-entry holders.

***

The minimum permitted tender is $1,000 in principal amount. All tenders must be in integral multiples of $1,000 in principal amount. Unless otherwise indicated in this column, the holder will be deemed to have tendered the full aggregate principal amount represented by such Outstanding Notes. See instruction 2.

Box 2
Book-Entry Transfer

o

CHECK HERE IF TENDERED OUTSTANDING NOTES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER MADE TO THE ACCOUNT MAINTAINED BY THE EXCHANGE AGENT AND COMPLETE THE FOLLOWING:

Name of Tendering Institution:

Account Number:

Transaction Code Number:

        Holders of Outstanding Notes that are tendering by book-entry transfer to the Exchange Agent's account at DTC can execute the tender through DTC's Automated Tender Offer Program ("ATOP") for which the transaction will be eligible. DTC participants that are accepting the Exchange Offer must transmit their acceptances to DTC, which will verify the acceptance and execute a book-entry delivery to the Exchange Agent's account at DTC. DTC will then send a computer-generated message (an "Agent's Message") to the Exchange Agent for its acceptance in which the holder of the Outstanding Notes acknowledges and agrees to be bound by the terms of, and makes the representations and warranties contained in, this Letter of Transmittal, and the DTC participant confirms on behalf of itself and the beneficial owners of such Outstanding Notes all provisions of this Letter of Transmittal (including any representations and warranties) applicable to it and such beneficial owner as fully as if it had completed the information required herein and executed and transmitted this Letter of Transmittal to the Exchange Agent. Each DTC participant transmitting an acceptance of the Exchange Offer through the ATOP procedures will be deemed to have agreed to be bound by the terms of this Letter of Transmittal. Delivery of an Agent's Message by DTC will satisfy the terms of the Exchange Offer as to execution and delivery of a Letter of Transmittal by the participant identified in the Agent's Message. DTC participants may also accept the Exchange Offer by submitting a Notice of Guaranteed Delivery through ATOP.

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Box 3
Notice of Guaranteed Delivery
(See Instruction 2 below)

o

CHECK HERE IF TENDERED OUTSTANDING NOTES ARE BEING DELIVERED PURSUANT TO A NOTICE OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE EXCHANGE AGENT AND COMPLETE THE FOLLOWING:

Name(s) of Registered Holder(s):

Window Ticket Number (if any):

Name of Eligible Guarantor Institution that Guaranteed Delivery:

Date of Execution of Notice of Guaranteed Delivery:

        IF GUARANTEED DELIVERY IS TO BE MADE BY BOOK-ENTRY TRANSFER:

Name of Tendering Institution:

Account Number:

Transaction Code Number:

Box 4
Return of Non-Exchanged Outstanding Notes
Tendered by Book-Entry Transfer

o

CHECK HERE IF OUTSTANDING NOTES TENDERED BY BOOK-ENTRY TRANSFER AND NON-EXCHANGED OUTSTANDING NOTES ARE TO BE RETURNED BY CREDITING THE ACCOUNT NUMBER SET FORTH ABOVE.

Box 5
Participating Broker-Dealer

o

CHECK HERE IF YOU ARE A BROKER-DEALER WHO ACQUIRED THE OUTSTANDING NOTES FOR YOUR OWN ACCOUNT AS A RESULT OF MARKET-MAKING OR OTHER TRADING ACTIVITIES AND WISH TO RECEIVE TEN (10) ADDITIONAL COPIES OF THE PROSPECTUS AND TEN (10) OF ANY AMENDMENTS OR SUPPLEMENTS THERETO.

Name:

Address:

        If the undersigned is not a broker-dealer, the undersigned represents that it is acquiring the Exchange Notes in the ordinary course of business and has no arrangement or understanding with any person to participate in a distribution of the Exchange Notes. If the undersigned is a broker-dealer that will receive Exchange Notes for its own account in exchange for Outstanding Notes that were acquired as a result of market-making activities or other trading activities, it acknowledges that it will deliver a

4

prospectus meeting the requirements of the Securities Act in connection with any resale or transfer of such Exchange Notes; however, by so acknowledging and by delivering a prospectus, the undersigned will not be deemed to admit that it is an "underwriter" within the meaning of the Securities Act. A broker-dealer may not participate in the Exchange Offer with respect to Outstanding Notes acquired other than as a result of market-making activities or other trading activities. Any broker-dealer who purchased Outstanding Notes from the Company to resell pursuant to Rule 144A under the Securities Act or any other available exemption under the Securities Act must comply with the registration and prospectus delivery requirements under the Securities Act.

PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY

Ladies and Gentlemen:

        Upon the terms and subject to the conditions of the Exchange Offer, the undersigned hereby tenders to the Company the aggregate principal amount of the Outstanding Notes indicated above. Subject to, and effective upon, the acceptance for exchange of all or any portion of the Outstanding Notes tendered herewith in accordance with the terms and conditions of the Exchange Offer (including, if the Exchange Offer is extended or amended, the terms and conditions of any such extension or amendment), the undersigned hereby exchanges, assigns and transfers to, or upon the order of, the Company all right, title and interest in and to such Outstanding Notes as are being tendered herewith.

        The undersigned hereby irrevocably constitutes and appoints the Exchange Agent as its true and lawful agent and attorney-in-fact of the undersigned (with full knowledge that the Exchange Agent also acts as the agent of the Company, in connection with the Exchange Offer) with respect to the tendered Outstanding Notes, with full power of substitution and resubstitution (such power of attorney being deemed an irrevocable power coupled with an interest) to (1) deliver certificates representing such Outstanding Notes, or transfer ownership of such Outstanding Notes on the account books maintained by the book-entry transfer facility specified by the holder(s) of the Outstanding Notes, together, in each such case, with all accompanying evidences of transfer and authenticity to, or upon the order of, the Company, (2) present and deliver such Outstanding Notes for transfer on the books of the Company and (3) receive all benefits or otherwise exercise all rights and incidents of beneficial ownership of such Outstanding Notes, all in accordance with the terms of the Exchange Offer.

        The undersigned hereby represents and warrants that (a) the undersigned has full power and authority to tender, exchange, assign and transfer the Outstanding Notes tendered hereby, (b) when such tendered Outstanding Notes are accepted for exchange, the Company will acquire good and unencumbered title thereto, free and clear of all liens, restrictions, charges and encumbrances and (c) the Outstanding Notes tendered for exchange are not subject to any adverse claims or proxies when accepted by the Company. The undersigned hereby further represents that any Exchange Notes acquired in exchange for Outstanding Notes tendered hereby will have been acquired in the ordinary course of business of the person receiving such Exchange Notes, whether or not such person is the undersigned, that neither the holder of such Outstanding Notes nor any such other person has an arrangement or understanding with any person to participate in the distribution of such Exchange Notes, and that neither the holder of such Outstanding Notes nor any such other person is an "affiliate", as such term is defined in Rule 405 under the Securities Act, of the Company or any Guarantor. If the undersigned is a person in the United Kingdom, the undersigned represents that its ordinary activities involve it in acquiring, holding, managing or disposing of investments (as principal or agent) for the purposes of its business.

        The undersigned also acknowledges that this Exchange Offer is being made based on the Company's understanding of an interpretation by the staff of the Securities and Exchange Commission (the "SEC") as set forth in no-action letters issued to third parties, including Morgan Stanley & Co. Incorporated (available June 5, 1991), Exxon Capital Holdings Corporation (available May 13, 1988), as

5

interpreted in the SEC's letter to Shearman & Sterling, dated July 2, 1993, or similar no-action letters, that the Exchange Notes issued in exchange for the Outstanding Notes pursuant to the Exchange Offer may be offered for resale, resold and otherwise transferred by each holder thereof (other than a broker-dealer who acquires such Exchange Notes directly from the Company for resale pursuant to Rule 144A under the Securities Act or any other available exemption under the Securities Act or any such holder that is an "affiliate" of the Company or the Guarantors within the meaning of Rule 405 under the Securities Act), without compliance with the registration and prospectus delivery provisions of the Securities Act, provided that such Exchange Notes are acquired in the ordinary course of such holder's business and such holder is not engaged in, and does not intend to engage in, a distribution of such Exchange Notes and has no arrangement or understanding with any person to participate in the distribution of such Exchange Notes. If a holder of the Outstanding Notes is an affiliate of the Company or the Guarantors, is not acquiring the Exchange Notes in the ordinary course of its business, is engaged in or intends to engage in a distribution of the Exchange Notes or has any arrangement or understanding with respect to the distribution of the Exchange Notes to be acquired pursuant to the Exchange Offer, such holder (x) may not rely on the applicable interpretations of the staff of the SEC and (y) must comply with the registration and prospectus delivery requirements of the Securities Act in connection with any secondary resale transaction. If the undersigned is a broker-dealer that will receive the Exchange Notes for its own account in exchange for the Outstanding Notes, it represents that the Outstanding Notes to be exchanged for the Exchange Notes were acquired by it as a result of market-making activities or other trading activities and acknowledges that it will deliver a prospectus in connection with any resale or transfer of such Exchange Notes; however, by so acknowledging and by delivering a prospectus, the undersigned will not be deemed to admit that it is an "underwriter" within the meaning of the Securities Act

        The undersigned will, upon request, execute and deliver any additional documents deemed by the Company or the Exchange Agent to be necessary or desirable to complete the exchange, assignment and transfer of the tendered Outstanding Notes or transfer ownership of such Outstanding Notes on the account books maintained by the book-entry transfer facility. The undersigned further agrees that acceptance of any and all validly tendered Outstanding Notes by the Company and the issuance of Exchange Notes in exchange therefor shall constitute performance in full by the Company of its obligations under the Registration Rights Agreement dated February 11, 2011, among the Company, the guarantors named therein, UBS Securities LLC and KKR Capital Markets LLC, as the initial purchasers (the "Registration Rights Agreement"), and that the Company shall have no further obligations or liabilities thereunder except as provided in Section [7] of such agreement. The undersigned will comply with its obligations under the Registration Rights Agreement.

        The Exchange Offer is subject to certain conditions as set forth in the Prospectus under the caption "The Exchange Offer—Conditions to the Exchange Offer." The undersigned recognizes that as a result of these conditions (which may be waived, in whole or in part, by the Company), as more particularly set forth in the Prospectus, the Company may not be required to exchange any of the Outstanding Notes tendered hereby and, in such event, the Outstanding Notes not exchanged will be returned to the undersigned at the address shown above, promptly following the expiration or termination of the Exchange Offer. In addition, the Company may amend the Exchange Offer at any time prior to the Expiration Date if any of the conditions set forth under "The Exchange Offer—Conditions to the Exchange Offer" occur.

        All authority herein conferred or agreed to be conferred in this Letter of Transmittal shall survive the death or incapacity of the undersigned and every obligation of the undersigned hereunder shall be binding upon the successors, assigns, heirs, administrators, trustees in bankruptcy and legal representatives of the undersigned. Tendered Outstanding Notes may be withdrawn at any time prior to the Expiration Date in accordance with the procedures set forth in the terms of this Letter of Transmittal.

6

        Unless otherwise indicated herein in the box entitled "Special Registration Instructions" below, please deliver the Exchange Notes (and, if applicable, substitute certificates representing the Outstanding Notes for any Outstanding Notes not exchanged) in the name of the undersigned or, in the case of a book-entry delivery of the Outstanding Notes, please credit the account indicated above. Similarly, unless otherwise indicated under the box entitled "Special Delivery Instructions" below, please send the Exchange Notes (and, if applicable, substitute certificates representing the Outstanding Notes for any Outstanding Notes not exchanged) to the undersigned at the address shown above in the box entitled "Description of Outstanding Notes Tendered Herewith."

THE UNDERSIGNED, BY COMPLETING THE BOX ENTITLED "DESCRIPTION OF OUTSTANDING NOTES TENDERED HEREWITH" ABOVE AND SIGNING THIS LETTER, WILL BE DEEMED TO HAVE TENDERED THE OUTSTANDING NOTES AS SET FORTH IN SUCH BOX.

Box 6
SPECIAL REGISTRATION INSTRUCTIONS
(See Instructions 4 and 5)

        To be completed ONLY if certificates for the Outstanding Notes not tendered and/or certificates for the Exchange Notes are to be issued in the name of someone other than the registered holder(s) of the Outstanding Notes whose name(s) appear(s) above.

Issue:	o	Outstanding Notes not tendered to:
	o	Exchange Notes to:

(Please Type or Print)

Name(s):

Address:

(Include Zip Code)

Daytime Area Code and Telephone Number:

Taxpayer Identification or Social Security Number:

Box 7
SPECIAL DELIVERY INSTRUCTIONS
(See Instructions 4 and 5)

        To be completed ONLY if certificates for the Outstanding Notes not tendered and/or certificates for the Exchange Notes are to be sent to someone other than the registered holder(s) of the

7

Outstanding Notes whose name(s) appear(s) above, or such registered holder(s) at an address other than that shown above.

Mail:	o	Outstanding Notes not tendered to:
	o	Exchange Notes to:

(Please Type or Print)

Name(s):

Address:

(Include Zip Code)

Daytime Area Code and Telephone Number:

Taxpayer Identification or Social Security Number:

Box 8
TENDERING HOLDER(S) SIGN HERE
(Complete accompanying substitute Form W-9)

        Must be signed by the registered holder(s) (which term, for the purposes described herein, shall include the book-entry transfer facility whose name appears on a security listing as the owner of the Outstanding Notes) of the Outstanding Notes exactly as their name(s) appear(s) on the Outstanding Notes hereby tendered or by any person(s) authorized to become the registered holder(s) by properly completed bond powers or endorsements and documents transmitted herewith. If signature is by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a corporation or other person acting in a fiduciary or representative capacity, please set forth the full title of such person. See Instruction 4.

(Signature(s) of Holder(s))

Date

Name(s):

Capacity (full title):

Address:

(Include Zip Code)

Daytime Area Code and Telephone Number:

Taxpayer Identification or Social Security Number:

8

GUARANTEE OF SIGNATURE(S)
(If Required—See Instruction 4)

Authorized Signature:

Date

Name(s):

Title

Name of Firm:

Address of Firm:

(Include Zip Code)

Area Code and Telephone Number:

Taxpayer Identification or Social Security Number:

9

Box 9
PAYER'S NAME: CPI International, Inc.

Substitute Form W-9

Department of the Treasury
Internal Revenue Service

Name

Social Security Number

OR

Employer Identification Number

Part 1—PLEASE PROVIDE YOUR TIN IN THE BOX AT RIGHT AND CERTIFY BY SIGNING AND DATING BELOW.
Signature	Date

Part 2—Certification—UNDER THE PENALTIES OF PERJURY, I CERTIFY THAT:

(1)    The number shown on this form is my correct Taxpayer Identification Number (or I am waiting for a number to be issued to me), and

(2)    I am not subject to backup withholding because (a) I am exempt from backup withholding, or (b) I have not been notified by the Internal Revenue Service (the "IRS") that I am subject to backup withholding as a result of a failure to report all interest or dividends, or (c) the IRS has notified me that I am no longer subject to backup withholding, and

(3)    I am a U.S. person (including a U.S. resident alien).

CERTIFICATE INSTRUCTIONS—You must cross out item (2) above if you have been notified by the IRS that you are currently subject to backup withholding because of under-reporting interest or dividends on your tax return. However, if after being notified by the IRS that you were subject to backup withholding you received another notification from the IRS that you are no longer subject to backup withholding, do not cross out such item (2).

Part 3—Awaiting TIN o

Payer's Request for Taxpayer Identification Number (TIN)

The Internal Revenue Service does not require your consent to any provision of this document other than the certifications required to avoid backup withholding.

Sign Here

Signature

Date

10

NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING OF 28% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.

YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU
CHECKED THE BOX IN PART 3 OF THE SUBSTITUTE FORM W-9.

CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER

        I certify under penalties of perjury that a taxpayer identification number has not been issued to me, and either (1) I have mailed or delivered an application to receive a taxpayer identification number to the appropriate Internal Revenue Service Center or Social Security Administration Office, or (2) I intend to mail or deliver an application in the near future. I understand that if I do not provide a taxpayer identification number by the time of payment, 28% of all reportable payments made to me will be withheld.

Signature
Date

GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9

Guidelines for Determining the Proper Identification Number for the Payee (You) to Give the Payer.—Social security numbers have nine digits separated by two hyphens: i.e., 000-00-0000. Employee identification numbers have nine digits separated by only one hyphen: i.e., 00-0000000. The table below will help determine the number to give the payer. All Section references are to the Internal Revenue Code of 1986, as amended. "IRS" is the Internal Revenue Service.

1.

List first and circle the name of the person whose number you furnish. If only one person on a joint account has a social security number, that person's number must be furnished.

2.

Circle the minor's name and furnish the minor's social security number.

3.

You must show your individual name, but you may also enter your business or "doing business as" name. You may use either your social security number or your employer identification number (if you have one).

4.

List first and circle the name of the legal trust, estate, or pension trust. (Do not furnish the taxpayer identification number of the personal representative or trustee unless the legal entity itself is not designated in the account title.)

NOTE: IF NO NAME IS CIRCLED WHEN THERE IS MORE THAN ONE NAME, THE NUMBER WILL BE CONSIDERED TO BE THAT OF THE FIRST NAME LISTED.

GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9

Obtaining a Number

        If you don't have a taxpayer identification number or you don't know your number, obtain Form SS-5, Application for a Social Security Card, at the local Social Administration office, or Form SS-4, Application for Employer Identification Number, by calling 1 (800) TAX-FORM, and apply for a number.

11

Payees Exempt from Backup Withholding

Payees specifically exempted from withholding include:

•

An organization exempt from tax under Section 501(a), an individual retirement account (IRA), or a custodial ac-count under Section 403(b)(7), if the account satisfies the requirements of Section 401(f)(2).

•

The United States or a state thereof, the District of Columbia, a possession of the United States, or a political subdivision or wholly-owned agency or instrumentality of any one or more of the foregoing.

•

An international organization or any agency or instrumentality thereof.

•

A foreign government and any political subdivision, agency or instrumentality thereof.

Payees that may be exempt from backup withholding include:

•

A corporation.

•

A financial institution.

•

A dealer in securities or commodities required to register in the United States, the District of Columbia, or a possession of the United States.

•

A real estate investment trust.

•

A common trust fund operated by a bank under Section 584(a).

•

An entity registered at all times during the tax year under the Investment Company Act of 1940.

•

A middleman known in the investment community as a nominee or custodian.

•

A futures commission merchant registered with the Commodity Futures Trading Commission.

•

A foreign central bank of issue.

•

A trust exempt from tax under Section 664 or described in Section 4947.

Payments of dividends and patronage dividends generally exempt from backup withholding include:

•

Payments to nonresident aliens subject to withholding under Section 1441.

•

Payments to partnerships not engaged in a trade or business in the United States and that have at least one nonresident alien partner.

•

Payments of patronage dividends not paid in money.

•

Payments made by certain foreign organizations.

•

Section 404(k) payments made by an ESOP.

Payments of interest generally exempt from backup withholding include:

•

Payments of interest on obligations issued by individuals. Note: You may be subject to backup withholding if this interest is $600 or more and you have not provided your correct taxpayer identification number to the payer.

•

Payments of tax-exempt interest (including exempt-interest dividends under Section 852).

•

Payments described in Section 6049(b)(5) to nonresident aliens.

•

Payments on tax-free covenant bonds under Section 1451.

12

•

Payments made by certain foreign organizations.

•

Mortgage interest paid to you.

        Certain payments, other than payments of interest, dividends, and patronage dividends, that are exempt from information reporting are also exempt from backup withholding. For details, see the regulations under sections 6041, 6041A, 6042, 6044, 6045, 6049, 6050A and 6050N.

Exempt payees described above must file Form W-9 or a substitute Form W-9 to avoid possible erroneous backup withholding. FILE THIS FORM WITH THE PAYER, FURNISH YOUR TAX-PAYER IDENTIFICATION NUMBER, WRITE "EXEMPT" IN PART 2 OF THE FORM, SIGN AND DATE THE FORM AND RETURN IT TO THE PAYER.

        Privacy Act Notice.—Section 6109 requires you to provide your correct taxpayer identification number to payers, who must report the payments to the IRS. The IRS uses the number for identification purposes and may also provide this information to various government agencies for tax enforcement or litigation purposes. Payers must be given the numbers whether or not recipients are required to file tax returns. Payers must generally withhold 28% of taxable interest, dividend, and certain other payments to a payee who does not furnish a taxpayer identification number to payer. Certain penalties may also apply.

Penalties

(1)

Failure to Furnish Taxpayer Identification Number.—If you fail to furnish your taxpayer identification number to a payer, you are subject to a penalty of $50 for each such failure unless your failure is due to reasonable cause and not to willful neglect.

(2)

Civil Penalty for False Information With Respect to Withholding.—If you make a false statement with no reasonable basis that results in no backup withholding, you are subject to a $500 penalty.

(3)

Criminal Penalty for Falsifying Information.—Willfully falsifying certifications or affirmations may subject you to criminal penalties including fines and/or imprisonment.

FOR ADDITIONAL INFORMATION CONTACT YOUR TAX CONSULTANT OR THE INTERNAL REVENUE SERVICE.

13

INSTRUCTIONS

FORMING PART OF THE TERMS AND CONDITIONS OF THE EXCHANGE OFFER

General

        Please do not send certificates for Outstanding Notes directly to the Company. Your certificates for Outstanding Notes, together with your signed and completed Letter of Transmittal and any required supporting documents, should be mailed or otherwise delivered to the Exchange Agent at the address set forth on the first page hereof. The method of delivery of Outstanding Notes, this Letter of Transmittal and all other required documents is at your sole option and risk and the delivery will be deemed made only when actually received by the Exchange Agent. If delivery is by mail, registered mail with return receipt requested, properly insured, or overnight or hand delivery service is recommended. In all cases, sufficient time should be allowed to ensure timely delivery.

1.

Delivery of this Letter of Transmittal and Certificated Guaranteed Delivery Procedures. A holder of Outstanding Notes (which term, for the purposes described herein, shall include the book-entry transfer facility whose name appears on a security listing as the owner of the Outstanding Notes) may tender the same by (i) properly completing and signing this Letter of Transmittal or a facsimile hereof (all references in the Prospectus to the Letter of Transmittal shall be deemed to include a facsimile thereof) and delivering the same, together with the certificate or certificates, if applicable, representing the Outstanding Notes being tendered and any required signature guarantees and any other documents required by this Letter of Transmittal, to the Exchange Agent at its address set forth above on or prior to the Expiration Date, (ii) complying with the procedure for book-entry transfer described below or (iii) complying with the guaranteed delivery procedures described below.

        Holders who wish to tender their Outstanding Notes and (i) whose Outstanding Notes are not immediately available or (ii) who cannot deliver their Outstanding Notes, this Letter of Transmittal and all other required documents to the Exchange Agent on or prior to the Expiration Date or (iii) who cannot comply with the book-entry transfer procedures on a timely basis, must tender their Outstanding Notes pursuant to the guaranteed delivery procedure set forth in "The Exchange Offer-Guaranteed Delivery Procedures" in the Prospectus and by completing Box 3. Holders may tender their Outstanding Notes if: (i) the tender is made by or through an Eligible Guarantor Institution (as defined below); (ii) the Exchange Agent receives (by facsimile transmission, mail or hand delivery), on or prior to the Expiration Date, a properly completed and duly executed Notice of Guaranteed Delivery in the form provided with this Letter of Transmittal that (a) sets forth the name and address of the holder of Outstanding Notes, if applicable, the certificate number(s) of the Outstanding Notes to be tendered and the principal amount of Outstanding Notes tendered; (b) states that the tender is being made thereby; and (c) guarantees that, within three New York Stock Exchange trading days after the Expiration Date, the Letter of Transmittal, or a facsimile thereof, together with the Outstanding Notes or a book-entry confirmation, and any other documents required by the Letter of Transmittal, will be deposited by the Eligible Guarantor Institution with the Exchange Agent; or (iii) the Exchange Agent receives a properly completed and executed Letter of Transmittal, or facsimile thereof and the certificate(s) representing all tendered Outstanding Notes in proper form or a confirmation of book-entry transfer of the Outstanding Notes into the Exchange Agent's account at the appropriate book-entry transfer facility and all other documents required by this Letter of Transmittal within three New York Stock Exchange trading days after the Expiration Date.

        Any Holder who wishes to tender Outstanding Notes pursuant to the guaranteed delivery procedures described above must ensure that the Exchange Agent receives the Notice of Guaranteed Delivery relating to such Outstanding Notes prior to the Expiration Date. Failure to complete the guaranteed delivery procedures outlined above will not, of itself, affect the validity or effect a

14

revocation of any Letter of Transmittal form properly completed and executed by a holder who attempted to use the guaranteed delivery procedures.

        No alternative, conditional, irregular or contingent tenders will be accepted. Each tendering holder, by execution of this Letter of Transmittal (or facsimile thereof), shall waive any right to receive notice of the acceptance of the Outstanding Notes for exchange.

2.

Partial Tenders; Withdrawals. Tenders of Outstanding Notes will be accepted only in the principal amount of $1,000 and integral multiples of $1,000. If less than the entire principal amount of Outstanding Notes evidenced by a submitted certificate is tendered, the tendering holder(s) must fill in the aggregate principal amount of Outstanding Notes tendered in the column entitled "Description of Outstanding Notes Tendered Herewith" in Box 1 above. A newly issued certificate for the Outstanding Notes submitted but not tendered will be sent to such holder promptly after the Expiration Date, unless otherwise provided in the appropriate box on this Letter of Transmittal. All Outstanding Notes delivered to the Exchange Agent will be deemed to have been tendered in full unless otherwise clearly indicated.

        Outstanding Notes tendered pursuant to the Exchange Offer may be withdrawn at any time prior to the Expiration Date, after which tenders of Outstanding Notes are irrevocable.

        To be effective with respect to the tender of Outstanding Notes, a written notice of withdrawal (which may be by telegram, telex, facsimile or letter) must: (i) be received by the Exchange Agent at the address for the Exchange Agent set forth above before the Company notifies the Exchange Agent that it has accepted the tender of Outstanding Notes pursuant to the Exchange Offer; (ii) specify the name of the person who tendered the Outstanding Notes to be withdrawn; (iii) identify the Outstanding Notes to be withdrawn (including the principal amount of such Outstanding Notes, or, if applicable, the certificate numbers shown on the particular certificates evidencing such Outstanding Notes and the principal amount of Outstanding Notes represented by such certificates); (iv) include a statement that such holder is withdrawing its election to have such Outstanding Notes exchanged; (v) specify the name in which any such Outstanding Notes are to be registered, if different from that of the withdrawing holder; and (vi) be signed by the holder in the same manner as the original signature on this Letter of Transmittal (including any required signature guarantee). The Exchange Agent will return the properly withdrawn Outstanding Notes promptly following receipt of notice of withdrawal. If Outstanding Notes have been tendered pursuant to the procedure for book-entry transfer, any notice of withdrawal must specify the name and number of the account at the book-entry transfer facility to be credited with the withdrawn Outstanding Notes or otherwise comply with the book-entry transfer facility's procedures. All questions as to the validity, form and eligibility of notices of withdrawals, including time of receipt, will be determined by the Company, and such determination will be final and binding on all parties.

        Any Outstanding Notes so withdrawn will be deemed not to have been validly tendered for exchange for purposes of the Exchange Offer. Any Outstanding Notes which have been tendered for exchange but which are not accepted for exchange for any reason will be returned to the holder thereof without cost to such holder (or, in the case of Outstanding Notes tendered by book-entry transfer into the Exchange Agent's account at the book entry transfer facility pursuant to the book-entry transfer procedures described above, such Outstanding Notes will be credited to an account with such book-entry transfer facility specified by the holder) promptly after withdrawal, rejection of tender or termination of the Exchange Offer. Properly withdrawn Outstanding Notes may be retendered by following one of the procedures described under the caption "The Exchange Offer-Procedures for Tendering Outstanding Notes" in the Prospectus at any time prior to the Expiration Date.

        Neither the Issuer, any affiliate or assigns of the Issuer, the Exchange Agent nor any other person will be under any duty to give any notification of any irregularities in any notice of withdrawal or incur any liability for failure to give such notification (even if such notice is given to other persons).

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3.

Beneficial Owner Instructions. Only a holder of Outstanding Notes (i.e., a person in whose name Outstanding Notes are registered on the books of the registrar or, or, in the case of Outstanding Notes held through book-entry, such book-entry transfer facility specified by the holder), or the legal representative or attorney-in-fact of a holder, may execute and deliver this Letter of Transmittal. Any beneficial owner of Outstanding Notes who wishes to accept the Exchange Offer must arrange promptly for the appropriate holder to execute and deliver this Letter of Transmittal on his or her behalf through the execution and delivery to the appropriate holder of the "Beneficial Owner Instructions to Registered Holder" form accompanying this Letter of Transmittal.

4.

Signature on this Letter of Transmittal; Written Instruments and Endorsements; Guarantee of Signatures. If this Letter of Transmittal is signed by the registered holder(s) (which term, for the purposes described herein, shall include the book-entry transfer facility whose name appears on a security listing as the owner of the Outstanding Notes) of the Outstanding Notes tendered hereby, the signature must correspond exactly with the name(s) as written on the face of the certificates (or on such security listing) without alteration, addition, enlargement or any change whatsoever.

        If any of the Outstanding Notes tendered hereby are owned of record by two or more joint owners, all such owners must sign this Letter of Transmittal.

        If a number of Outstanding Notes registered in different names are tendered, it will be necessary to complete, sign and submit as many separate copies of this Letter of Transmittal (or facsimiles thereof) as there are different registrations of Outstanding Notes.

        When this Letter of Transmittal is signed by the registered holder(s) of Outstanding Notes (which term, for the purposes described herein, shall include the book-entry transfer facility whose name appears on a security listing as the owner of the Outstanding Notes) listed and tendered hereby, no endorsements of certificates or separate written instruments of transfer or exchange are required. If, however, this Letter of Transmittal is signed by a person other than the registered holder(s) of the Outstanding Notes listed or the Exchange Notes are to be issued, or any untendered Outstanding Notes are to be reissued, to a person other than the registered holder(s) of the Outstanding Notes, such Outstanding Notes must be endorsed or accompanied by separate written instruments of transfer or exchange in form satisfactory to the Company and duly executed by the registered holder, in each case signed exactly as the name or names of the registered holder(s) appear(s) on the Outstanding Notes and the signatures on such certificates must be guaranteed by an Eligible Guarantor Institution.

        If this Letter of Transmittal, any certificates or separate written instruments of transfer or exchange are signed by trustees, executors, administrators, guardians, attorneys-in-fact, officers of corporations or others acting in a fiduciary or representative capacity, such persons should so indicate when signing, and, unless waived by the Company, submit proper evidence satisfactory to the Company, in its sole discretion, of such persons' authority to so act.

Endorsements on certificates for the Outstanding Notes or signatures on bond powers required by this Instruction 4 must be guaranteed by a member firm of a registered national securities exchange or of the National Association of Securities Dealers, Inc., a commercial bank or trust company having an office or correspondent in the United States or another "eligible guarantor institution" within the meaning of Rule 17Ad-15 under the Securities Exchange Act of 1934, as amended (an "Eligible Guarantor Institution").

Signatures on this Letter of Transmittal must be guaranteed by an Eligible Guarantor Institution, unless Outstanding Notes are tendered: (i) by a registered holder (which term, for the purposes described herein, shall include the book-entry transfer facility whose name appears on a security listing as the owner of the Outstanding Notes) who has not completed the box entitled "Special

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Registration Instructions" or "Special Delivery Instructions" on this Letter of Transmittal; or (ii) for the account of an Eligible Guarantor Institution.

5.

Special Registration and Delivery Instructions. Tendering holders should indicate, in the applicable Box 6 or Box 7, the name and address in/to which the Exchange Notes and/or certificates for Outstanding Notes not exchanged are to be issued or sent, if different from the name(s) and address(es) of the person signing this Letter of Transmittal. In the case of issuance in a different name, the tax identification number or social security number of the person named must also be indicated. A holder tendering the Outstanding Notes by book-entry transfer may request that the Outstanding Notes not exchanged be credited to such account maintained at the book-entry transfer facility as such holder may designate. See Box 4.

        If no such instructions are given, the Exchange Notes (and any Outstanding Notes not tendered or not accepted) will be issued in the name of and sent to the holder signing this Letter of Transmittal or deposited into such holder's account at the applicable book-entry transfer facility.

6.

Transfer Taxes. The Company shall pay all transfer taxes, if any, applicable to the transfer and exchange of the Outstanding Notes to it or its order pursuant to the Exchange Offer. If, however, the Exchange Notes are delivered to or issued in the name of a person other than the registered holder, or if a transfer tax is imposed for any reason other than the transfer and exchange of Outstanding Notes to the Company or its order pursuant to the Exchange Offer, the amount of any such transfer taxes (whether imposed on the registered holder or any other person) will be payable by the tendering holder. If satisfactory evidence of payment of such taxes or exemption therefrom is not submitted herewith the amount of such transfer taxes will be billed directly to such tendering holder.

        Except as provided in this Instruction 6, it will not be necessary for transfer tax stamps to be affixed to the Outstanding Notes listed in this Letter of Transmittal.

7.

Waiver of Conditions. The Company reserves the absolute right to waive, in whole or in part, any of the conditions to the Exchange Offer set forth in the Prospectus.

8.

Mutilated, Lost, Stolen or Destroyed Securities. Any holder whose Outstanding Notes have been mutilated, lost, stolen or destroyed, should promptly contact the Exchange Agent at the address set forth on the first page hereof for further instructions. The holder will then be instructed as to the steps that must be taken in order to replace the certificate(s). This Letter of Transmittal and related documents cannot be processed until the procedures for replacing lost, destroyed or stolen certificate(s) have been completed.

9.

No Conditional Tenders; No Notice of Irregularities. No alternative, conditional, irregular or contingent tenders will be accepted. All tendering holders, by execution of this Letter of Transmittal, shall waive any right to receive notice of the acceptance of their Outstanding Notes for exchange. The Company reserves the right, in its reasonable judgment, to waive any defects, irregularities or conditions of tender as to particular Outstanding Notes. The Company's interpretation of the terms and conditions of the Exchange Offer (including the instructions in this Letter of Transmittal) will be final and binding on all parties. Unless waived, any defects or irregularities in connection with tenders of Outstanding Notes must be cured within such time as the Company shall determine. Although the Company intends to notify holders of defects or irregularities with respect to tenders of Outstanding Notes, neither the Company, the Exchange Agent nor any other person is under any obligation to give such notice nor shall they incur any liability for failure to give such notification. Tenders of Outstanding Notes will not be deemed to have been made until such defects or irregularities have been cured or waived. Any Outstanding Notes received by the Exchange Agent that are not properly tendered and as to which the defects

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or irregularities have not been cured or waived will be returned by the Exchange Agent to the tendering holder promptly following the Expiration Date.

10.

Requests for Assistance or Additional Copies. Questions relating to the procedure for tendering, as well as requests for additional copies of the Prospectus and this Letter of Transmittal, may be directed to the Exchange Agent at the address and telephone number set forth on the first page hereof.

IMPORTANT: THIS LETTER OF TRANSMITTAL OR A FACSIMILE OR COPY THEREOF (TOGETHER WITH CERTIFICATES OF OUTSTANDING NOTES OR CONFIRMATION OF BOOK-ENTRY TRANSFER AND ALL OTHER REQUIRED DOCUMENTS) OR A NOTICE OF GUARANTEED DELIVERY MUST BE RECEIVED BY THE EXCHANGE AGENT ON OR PRIOR TO THE EXPIRATION DATE.

IMPORTANT TAX INFORMATION

        Under U.S. federal income tax law, a tendering holder whose Outstanding Notes are accepted for exchange may be subject to backup withholding unless the holder provides The Bank of New York Mellon Trust Company, N.A. as Paying Agent (the "Paying Agent"), with either (i) such holder's correct taxpayer identification number ("TIN") on the Substitute Form W-9 attached hereto, certifying (A) that the TIN provided on Substitute Form W-9 is correct (or that such holder of Outstanding Notes is awaiting a TIN), (B) that the holder of Outstanding Notes is not subject to backup withholding because (x) such holder of Outstanding Notes is exempt from backup withholding, (y) such holder of Outstanding Notes has not been notified by the Internal Revenue Service that he or she is subject to backup withholding as a result of a failure to report all interest or dividends or (z) the Internal Revenue Service has notified the holder of Outstanding Notes that he or she is no longer subject to backup withholding and (C) that the holder of Outstanding Notes is a U.S. person (including a U.S. resident alien); or (ii) an adequate basis for exemption from backup withholding. If such holder of Outstanding Notes is an individual, the TIN is such holder's social security number. If the Paying Agent is not provided with the correct TIN, the holder of Outstanding Notes may also be subject to certain penalties imposed by the Internal Revenue Service and any payments that are made to such holder may be subject to backup withholding (see below).

        Certain holders of Outstanding Notes (including, among others, all corporations and certain foreign individuals) are not subject to these backup withholding and reporting requirements. However, exempt holders of Outstanding Notes should indicate their exempt status on the Substitute Form W-9. For example, a corporation should complete the Substitute Form W-9, providing its TIN and indicating that it is exempt from backup withholding. In order for a foreign individual to qualify as an exempt recipient, the holder must submit a Form W-8BEN, signed under penalties of perjury, attesting to that individual's exempt status. A Form W-8BEN can be obtained from the Paying Agent. See the enclosed "Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9" for more instructions. Holders are encouraged to consult their own tax advisors to determine whether they are exempt from these backup withholding and reporting requirements.

        If backup withholding applies, the Paying Agent is required to withhold 28% of any payments made to the holder of Outstanding Notes or other payee. Backup withholding is not an additional tax. Rather, the tax liability of persons subject to backup withholding will be reduced by the amount of tax withheld. If withholding results in an overpayment of taxes, a refund may be obtained from the Internal Revenue Service, provided the required information is furnished. The Paying Agent cannot refund amounts withheld by reason of backup withholding.

        A holder who does not have a TIN may check the box in Part 3 of the Substitute Form W-9 if the surrendering holder of Outstanding Notes has not been issued a TIN and has applied for a TIN or intends to apply for a TIN in the near future. If the box in Part 3 is checked, the holder of Outstanding

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Notes or other payee must also complete the Certificate of Awaiting Taxpayer Identification Number below in order to avoid backup withholding. Notwithstanding that the box in Part 3 is checked and the Certificate of Awaiting Taxpayer Identification Number is completed, the Paying Agent will withhold 28% of all payments made prior to the time a properly certified TIN is provided to the Paying Agent and, if the Paying Agent is not provided with a TIN within 60 days, such amounts will be paid over to the Internal Revenue Service.

        The holder of Outstanding Notes is required to give the Paying Agent the TIN (e.g., social security number or employer identification number) of the record owner of the Outstanding Notes. If the Outstanding Notes are in more than one name or are not in the name of the actual owner, consult the enclosed "Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9" for additional guidance on which number to report.

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Exhibit 99.1

CPI INTERNATIONAL, INC. OFFER TO EXCHANGE $215,000,000 aggregate principal amount of 8.00% Senior Notes due 2018, which have been registered under the Securities Act of 1933, for any and all outstanding 8.00% Senior Notes due 2018
The Exchange Agent for the Exchange Offer is: THE BANK OF NEW YORK MELLON TRUST COMPANY, N.A.
PLEASE READ THE ENTIRE LETTER OF TRANSMITTAL AND THE PROSPECTUS CAREFULLY BEFORE CHECKING ANY BOX BELOW.
All Tendering Holders Complete Box 1: Box 1* Description of Outstanding Notes Tendered Herewith
Box 2 Book-Entry Transfer
Box 3 Notice of Guaranteed Delivery (See Instruction 2 below)
Box 4 Return of Non-Exchanged Outstanding Notes Tendered by Book-Entry Transfer
Box 5 Participating Broker-Dealer
Box 6 SPECIAL REGISTRATION INSTRUCTIONS (See Instructions 4 and 5)
Box 7 SPECIAL DELIVERY INSTRUCTIONS (See Instructions 4 and 5)
Box 8 TENDERING HOLDER(S) SIGN HERE (Complete accompanying substitute Form W-9)
GUARANTEE OF SIGNATURE(S) (If Required—See Instruction 4)
Box 9 PAYER'S NAME: CPI International, Inc.
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN PART 3 OF THE SUBSTITUTE FORM W-9. CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9
INSTRUCTIONS FORMING PART OF THE TERMS AND CONDITIONS OF THE EXCHANGE OFFER
IMPORTANT TAX INFORMATION

EX-99.2

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EXHIBIT 99.2

CPI INTERNATIONAL, INC.
OFFER TO EXCHANGE

$215,000,000 aggregate principal amount of 8.00% Senior Notes
due 2018, which have been registered under the Securities Act of 1933, for any
and all outstanding 8.00% Senior Notes due 2018

                        , 2011

To Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees:

        CPI International, Inc., a Delaware corporation (the "Company"), is offering, upon and subject to the terms and conditions set forth in the prospectus dated            , 2011 (the "Prospectus"), to exchange (the "Exchange Offer") an aggregate principal amount of up to $215,000,000 of their 8.00% Senior Notes due 2018, which have been registered under the Securities Act of 1933, as amended, (individually a "New Note" and collectively, the "New Notes"), for a like principal amount at maturity of the Company's issued and outstanding 7.75% Senior Notes due 2020 (individually an "Old Note" and collectively, the "Old Notes"). The Exchange Offer is being made in order to satisfy certain obligations of the Company's contained in the Registration Rights Agreement, dated as of February 1, 2011, by and among the Company, the guarantors named therein and the initial purchasers referred to therein. Capitalized terms not defined herein shall have the respective meanings ascribed to them in the Prospectus.

        We are requesting that you contact your clients for whom you hold Old Notes regarding the Exchange Offer. For your information and for forwarding to your clients for whom you hold Old Notes registered in your name or in the name of your nominee, or who hold Old Notes registered in their own names, we are enclosing the following documents:

1.

Prospectus dated                        , 2011; and



2.

A form of letter which may be sent to your clients for whose account you hold Old Notes registered in your name or the name of your nominee, with space provided for obtaining such clients' instructions with regard to the Exchange Offer.

Your prompt action is requested. The Exchange Offer will expire at 5:00 p.m., New York City time, on                        , 2011 unless extended by the Company (the "Expiration Date"). Old Notes tendered pursuant to the Exchange Offer may be withdrawn (in accordance with the procedures set forth in the prospectus) at any time before the Expiration Date.

        A holder may only tender Old Notes by book-entry transfer of the Old Notes into the Exchange Agent's account at The Depository Trust Company. To participate in the Exchange Offer, a tendering holder must, on or prior to the Expiration Date, transmit an agent's message to the Exchange Agent, in accordance with the instructions set forth in the Prospectus.

        The Company will, upon request, reimburse brokers, dealers, commercial banks and trust companies for reasonable and necessary costs and expenses incurred by them in forwarding the Prospectus and the related documents to the beneficial owners of Old Notes held by them as nominee or in a fiduciary capacity. The Company will pay or cause to be paid all transfer taxes applicable to the exchange of Old Notes pursuant to the Exchange Offer.

        Any inquiry you may have with respect to the Exchange Offer, or requests for additional copies of the enclosed materials, should be directed to The Bank of New York Mellon Trust Company, N.A., the Exchange Agent for the Exchange Offer, at its address and telephone number set forth in the Prospectus under the caption "The Exchange Offer—The Exchange Agent."

Very truly yours,

CPI INTERNATIONAL, INC.

NOTHING HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU OR ANY PERSON AS AN AGENT OF THE COMPANY OR THE EXCHANGE AGENT, OR AUTHORIZE YOU OR ANY OTHER PERSON TO USE ANY DOCUMENT OR MAKE ANY STATEMENTS ON BEHALF OF EITHER OF THEM WITH RESPECT TO THE EXCHANGE OFFER, EXCEPT FOR STATEMENTS EXPRESSLY MADE IN THE PROSPECTUS.

Enclosures

2

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EXHIBIT 99.2

EX-99.3

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EXHIBIT 99.3

CPI INTERNATIONAL, INC.

OFFER TO EXCHANGE

$215,000,000 aggregate principal amount of 8.00% Senior Notes
due 2018, which have been registered under the Securities Act of 1933, for any
and all outstanding 8.00% Senior Notes due 2018

, 2011

To our Clients:

        Enclosed for your consideration are a Prospectus, dated                        , 2011 (as the same may be amended or supplemented from time to time, the "Prospectus"), and a Letter of Transmittal (the "Letter of Transmittal"), relating to the offer (the "Exchange Offer") by CPI International, Inc., a Delaware corporation (the "Company"), CPI International Holding Corp., a Delaware corporation (the "Parent Guarantor"), and certain subsidiary guarantors of the Company (together with the Parent Guarantor, the "Guarantors"), to exchange (the "Exchange Offer") up to $215,000,000 aggregate principal amount of 8.00% Senior Notes due 2018, which have been registered under the Securities Act of 1933, as guaranteed by the Guarantors (the "Exchange Notes"), for any and all of its outstanding 8.00% Senior Notes due 2018 guaranteed by the Guarantors (the "Outstanding Notes") in integral multiples of $1,000 upon the terms and subject to the conditions of the enclosed Prospectus and the enclosed Letter of Transmittal. The terms of the Exchange Notes are identical in all material respects (including principal amount, interest rate and maturity) to the terms of the Outstanding Notes for which they may be exchanged pursuant to the Exchange Offer, except that the Exchange Notes are freely transferable by holders thereof, upon the terms and subject to the conditions of the enclosed Prospectus and the related Letter of Transmittal. The Outstanding Notes are unconditionally guaranteed (the "Old Guarantees") by the Guarantors, and the Exchange Notes will be unconditionally guaranteed (the "New Guarantees") by the Guarantors. Upon the terms and subject to the conditions set forth in the Prospectus and the Letter of Transmittal, the Guarantors offer to issue the New Guarantees with respect to all Exchange Notes issued in the Exchange Offer in exchange for the Old Guarantees of the Outstanding Notes for which such Exchange Notes are issued in the Exchange Offer. Throughout this letter, unless the context otherwise requires and whether so expressed or not, references to the "Exchange Offer" include the Guarantors' offer to exchange the New Guarantees for the Old Guarantees, references to the "Exchange Notes" include the related New Guarantees and references to the "Outstanding Notes" include the related Old Guarantees. The Company will accept for exchange any and all Outstanding Notes properly tendered according to the terms of the Prospectus and the Letter of Transmittal. Consummation of the Exchange Offer is subject to certain conditions described in the Prospectus.

        This material is being forwarded to you as the beneficial owner of the Outstanding Notes held by us for your account but not registered in your name. A tender of such Outstanding Notes may only be made by us as the holder of record and pursuant to your instructions.

        Accordingly, we request instructions as to whether you wish us to tender on your behalf the Outstanding Notes held by us for your account, pursuant to the terms and conditions set forth in the enclosed Prospectus. You may only tender your Outstanding Notes by book-entry transfer of the Outstanding Notes into the exchange agent's account at The Depository Trust Company.

        Your instructions should be forwarded to us as promptly as possible in order to permit us to tender the Outstanding Notes on your behalf in accordance with the provisions of the Exchange Offer. The Exchange Offer will expire at 5:00 p.m., New York City time, on                        , 2011 unless extended by the Company. Any Outstanding Notes tendered pursuant to the Exchange Offer may be withdrawn (in accordance with the procedures set forth in the prospectus) at any time before the Expiration Date.

        Your attention is directed to the following:

1.

The Exchange Offer is for any and all Outstanding Notes.



2.

The Exchange Offer is subject to certain conditions set forth in the Prospectus in the section captioned "The Exchange Offer—Conditions to the Exchange Offer."



3.

Any transfer taxes incident to the transfer of Outstanding Notes from the holder to the Company will be paid by Company.



4.

The Exchange Offer expires at 5:00 p.m., New York City time, on                                    , 2011 unless extended by Company.

        If you wish to have us tender your Outstanding Notes, please so instruct us by completing, executing and returning to us the instruction form on the back of this letter.

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INSTRUCTIONS WITH RESPECT TO
THE EXCHANGE OFFER

        The undersigned acknowledge(s) receipt of your letter and the enclosed material referred to therein relating to the Exchange Offer made by the Company with respect to the Outstanding Notes.

        This will instruct you to tender the Outstanding Notes held by you for the account of the undersigned, upon and subject to the terms and conditions set forth in the Prospectus.

        Please tender the Outstanding Notes held by you for my account as indicated below:

o

Please tender the Outstanding Notes held by you for my account as indicated below:

AGGREGATE PRINCIPAL AMOUNT AT
MATURITY OF OUTSTANDING NOTES

8.00% Senior Notes due 2018: $                                    

o

Please do not tender any Outstanding Notes held by you for my account.

        Dated: , 2011

        Signature(s):

        Print Name(s) here:

        Print Address(es):

        Area Code and Telephone Number(s):

        Tax Identification or Social Security Number(s):

None of the Outstanding Notes held by us for your account will be tendered unless we receive written instructions from you to do so. Unless a specific contrary instruction is given in the space provided, your signature(s) hereon shall constitute an instruction to us to tender all Outstanding Notes held by us for your account.

Very truly yours,

CPI INTERNATIONAL, INC.

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EXHIBIT 99.3

CORRESP

CPI INTERNATIONAL, INC.

811 Hansen Way

Palo Alto, California 94303-1110

April 7, 2011

VIA EDGAR

Division of Corporation Finance

Securities and Exchange Commission

100 F Street, N.E.

Washington, D.C. 20549

Re:CPI International, Inc. Registration Statement on Form S-4

Ladies and Gentlemen:

CPI International, Inc. (the “Issuer”), the primary obligor under the 8.00% Senior Notes due 2018 (the “Restricted Notes”), and each of the guarantors set forth on the signature page hereto (the “Guarantors” and, together with the Issuer, the “Registrants”) are registering an exchange offer (the “Exchange Offer”) pursuant to a Registration Statement on Form S-4 in reliance on the staff of the Securities and Exchange Commission’s position enunciated in Exxon Capital Holdings Corporation (available May 13, 1988), Morgan Stanley & Co. Incorporated (available June 5, 1991) and Shearman & Sterling (available July 2, 1993).  The Registrants represent as follows:

1.The Registrants have not entered into any arrangement or understanding with any person to distribute the 8.00% Senior Notes due 2018 to be received in the Exchange Offer (the “Exchange Notes”) and, to the best of the Registrants’ information and belief, each person participating in the Exchange Offer is acquiring the Exchange Notes in its ordinary course of business and has no arrangement or understanding with any person to participate in the distribution of the Exchange Notes to be received in the Exchange Offer.

2.In this regard, the Registrants will make each person participating in the Exchange Offer aware (through the Exchange Offer prospectus or otherwise) that if such person is participating in the Exchange Offer for the purpose of distributing the Exchange Notes to be acquired in the Exchange Offer, such person (i) cannot rely on the staff position enunciated in Exxon Capital Holdings Corporation (available April 13, 1989) or interpretive letters to similar effect and (ii) must comply with registration and prospectus delivery requirements of the Securities Act of 1933, as amended (the “Securities Act”), in connection with a secondary resale transaction.

3.The Registrants acknowledge that such a secondary resale transaction by such person participating in the Exchange Offer for the purpose of distributing the Exchange

Notes should be covered by an effective registration statement containing the selling securityholder information required by Item 507 of Regulation S-K under the Securities Act.

4.The Registrants further represent that with respect to any broker-dealer that participates in the Exchange Offer with respect to outstanding securities acquired for its own account as a result of market-making activities or other trading activities, each such broker-dealer must confirm that it has not entered into any agreement or understanding with the Registrants or any affiliate of the Registrants to distribute the Exchange Notes.

5.The Registrants will make each person participating in the Exchange Offer aware (through the Exchange Offer prospectus) that any broker-dealer who holds Restricted Notes (as described in the Exchange Offer prospectus) acquired for its own account as a result of market-making activities or other trading activities, and who receives Exchange Notes in exchange for such Restricted Notes pursuant to the Exchange Offer, may be a statutory underwriter and must deliver a prospectus meeting the requirements of the Securities Act (as described in Shearman & Sterling (available July 2, 1993)) in connection with any resale of such Exchange Notes.

6.The Registrants will require the exchange offeree to represent to the following additional provisions:

(a)If the exchange offeree is not a broker-dealer, an acknowledgment that it is not engaged in, and does not intend to engage in, a distribution of the Exchange Notes.

(b)If the exchange offeree is a broker-dealer holding Restricted Notes acquired for its own account as a result of market-making activities or other trading activities, an acknowledgment that it will deliver a prospectus meeting the requirements of the Securities Act in connection with any resale of Exchange Notes received in respect of such Restricted Notes pursuant to the Exchange Offer; and a statement to the effect that by so acknowledging and by delivering a prospectus, such broker-dealer will not be deemed to admit that it is an “underwriter” within the meaning of the Securities Act.

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Very truly yours,
	CPI INTERNATIONAL, INC.
	By:	/s/ Joel A. Littman
	Name:		Joel A. Littman
	Title:		Chief Financial Officer, Treasurer
			and Secretary

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GUARANTORS
CPI INTERNATIONAL HOLDING CORP.
COMMUNICATIONS & POWER INDUSTRIES LLC
CPI SUBSIDIARY HOLDINGS LLC
COMMUNICATIONS & POWER INDUSTRIES INTERNATIONAL INC.
COMMUNICATIONS & POWER INDUSTRIES ASIA INC.
CPI ECONCO DIVISION
CPI MALIBU DIVISION
By:	/s/ Joel A. Littman
Name:		Joel A. Littman
Title:		Secretary

4