The Company has a $1,050 million senior secured credit facility with a syndicate of lenders (in excess of 50 lenders as of June 30, 2011) that matures on June 30, 2012. The Bank Facility was originally comprised of $650 million in revolving credit (the "Revolver") and a $400 million term loan (the "Term Loan"). The Term Loan amortizes in quarterly amounts, which payments started at $15 million and increase from $25 million to $60 million on September 30, 2011. The Company plans to continue to fund the amortization of the Term Loan with cash flow from operations and its available Revolver capacity.

As of June 30, 2011, the Company had outstanding under the Bank Facility $625.0 million, including: (i) $387.5 million in drawn Revolver; and (ii) $237.5 million in Term Loan. As of June 30, 2011, the Company had $2.0 million in cash and cash equivalents. As of June 30, 2011, the undrawn amount of the Revolver was $261.9 million. The amount of the Revolver available to the Company, however, is a function of covenant compliance at the time of borrowing. Based on the Company's financial covenant analysis as of June 30, 2011, the Company would be limited to borrowings significantly less than the undrawn limit unless such borrowings were used to repay indebtedness or for transactions that increase cash flow for purposes of covenant calculation.

The Company's ability to maintain compliance with its covenants is highly dependent on the Company's results of operations. If the Company were to enter into an agreement with its lenders for covenant compliance relief, such relief could result in higher interest expense.

Refinancing the Company's Bank Facility and/or obtaining other funding prior to the expiration of the current agreement will be essential since the Revolver balance outstanding, together with the final $60.0 million Term Loan installment, will be due in full upon the maturity of the Bank Facility on June 30, 2012. In the event the Company is not successful in refinancing the Bank Facility and/or obtaining other funding prior to the maturity of the current agreement, the Company would not have the resources to fund these obligations on June 30, 2012, which could have a material adverse effect on the Company's business. As of June 30, 2011, the Company reclassified all of its debt outstanding under the Bank Facility from long-term to short-term.

Management believes that the Company can continue to maintain its compliance with these covenants until maturity of the Bank Facility on June 30, 2012. Management also believes that cash on hand and cash from operating activities, together with available borrowings under the Revolver, will be sufficient to permit the Company to meet its liquidity requirements until the maturity of the Bank Facility, including the Company's scheduled Term Loan amortization. The Company's operating cash flow remains positive and management believes that it is adequate to fund the Company's operating needs. As a result, the Company has not been required to rely upon, and the Company does not anticipate being required to rely upon, the Revolver to fund the Company's operations.

On March 11, 2010, the Company amended its Bank Facility (the "Amendment"). The Company is required to maintain certain financial covenants which are defined terms within the agreement, including: (i) a maximum Consolidated Leverage Ratio that decreases quarterly in 2011, with a ratio of 6.5 times as of June 30, 2011 to a ratio that will not exceed 6.0 times as of December 31, 2011 and thereafter; and (ii) a minimum ratio of Consolidated Operating Cash Flow to Consolidated Interest Charges of 2.0 times. Management believes the Company is in compliance with all financial covenants and all other terms of the Bank Facility as of June 30, 2011.

Certain key terms as defined within the Bank Facility were revised in this Amendment as follows:

The Bank Facility is secured by a pledge of 100% of the capital stock and other equity interest in all of the Company's wholly owned subsidiaries. In addition, the Bank Facility is secured by a lien on all of the Company's assets, other than real property.

The Amendment was treated as a modification to a debt instrument. As a result, in the first quarter of 2010, the Company recorded deferred financing costs of $5.2 million related to the Amendment which will be amortized over the remaining life of the Bank Facility on: (1) a straight-line basis for the Revolver; and (2) an effective interest rate method for the Term. In addition, unamortized deferred financing costs of $3.1 million as of the Amendment date will continue to be amortized over the remaining life of the Bank Facility.

Prior to the Amendment, the interest rate on the Company's Bank Facility was: (i) the Eurodollar rate plus a rate that ranges from 0.50% to 1.13%; or (ii) the greater of prime rate plus a rate that ranges from 0.0% to 0.13% or the federal funds rate plus a rate that ranges from 0.50% to 0.63%.

The following table presents for the periods indicated: (1) the amount of gain or loss recorded on the extinguishment of the Notes; and (2) the amount of Notes retired:

	For the Six
	Months Ended
	June 30,
	2010
	(amounts in
	thousands)

Write-off of deferred financing costs	$	62
Gain on debt extinguishment		-
Net (gain) loss on debt extinguishment	$	62

Amount of Notes retired	$	6,579

On March 8, 2010, the Company redeemed at par all of its remaining outstanding senior subordinated notes that were due March 1, 2014 and recorded in the statement of operations a loss on the extinguishment of debt.