Exhibit 10.16
 
LOAN AND SECURITY AGREEMENT
 
THIS LOAN AND SECURITY AGREEMENT, as amended, restated, extended or otherwise
modified by the parties hereto, their successors and assigns, from time to time,
including, without limitation, all schedules and attachments hereto
(“Agreement”), is made and entered into this 24th day of February 2010, by and
between WLG (USA) LLC and World Commerce Services, L.L.C., limited liability
companies organized and existing under the laws of the State of Illinois with
principal places of business located at 920 East Algonquin Road, Suite 120,
Schaumburg, IL 60173(each a “Borrower” and collectively, the "Borrowers")
and  NOVA Business Credit, a division of NOVA Bank, with offices located at 1235
Westlakes Drive, Suite 420, Berwyn, PA 19312 ("Lender").
 
WITNESSETH:
 
BACKGROUND
 
Borrowers have requested Lender to establish on its books and records a
revolving credit facility ("Revolving Credit") pursuant to which Lender may make
revolving loans and advances to Borrowers up to an aggregate amount at one time
outstanding equal to Three Million Dollars ($3,000,000.00), subject to Section
2.1.6 hereof ("Revolving Credit Limit") secured by the Collateral, as such term
is defined in Section 3 herein, and evidenced by a promissory note (the
“Revolving Loan Note”) of even date. Lender is willing to do so upon the terms
and conditions hereinafter set forth.
 
NOW THEREFORE, in consideration of the promises herein contained, and each
intending to be legally bound hereby, the parties agree as follows:
 
1.           DEFINITIONS.       All terms defined in Schedule 1 and all other
capitalized terms defined in this Agreement, shall have the meanings ascribed to
them herein when used in the Loan Documents, unless otherwise defined therein.
 
2.           THE LOANS.
 
2.1         The Revolving Credit.
 
2.1.1 Subject to the terms and limitations hereof, Borrowers (or either of them)
may borrow, repay and re-borrow hereunder the amount equal to the Borrowing Base
or any lesser amount (the “Revolving Loans” and together with all other loans
and advances made hereunder, the “Loans”), each advance evidenced by Lender’s
books and Records, from time to time until the earliest of:
 
(a) the date one (1) year from the date of this Agreement;
 
(b) the occurrence of an Event of Default; or
 
(c) that date specified in a written notice of termination from either party to
the other party, provided that if such notice is from Borrowers to Lender, such
date shall be no less than 60 days following the date of such notice and subject
to a prepayment penalty of three (3%) of the Revolving Credit Limit in Year 1,
reduced to 2% in Year 2, if renewed.
 
Any such event, a “Revolving Credit Termination Date”.
 
2.1.2 Each application by Borrowers for a Loan hereunder shall be accompanied
by;
 
 (a) a fully completed Borrowing Base Certificate;
 
(b) an accounts receivable aging report based upon invoice dates;
 
(c) copies of:
 
(i) invoices and/or written contracts or orders from which the Account arose;
 
(ii) credit memos (which shall be issued promptly by Borrowers and reflected in
Borrowers’ next Borrowing Base Certificate and/or accounts receivable
reconciliation);
 
(iii) debit memos;
 
(iv) valid shipping or delivery receipts evidencing the shipment of the Goods
that gave rise to the Account and bills of lading (“Shipping Documents”);
 
 (v) warehouse receipts, if applicable;
 
 (vi) sales journals;
 
 (vii) cash receipts registers;
 
 
 

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(viii) credit memo registers;
 
(ix)   Chattel Paper and, if applicable,
 
(x) any other documents required by Lender (items (i) through (x) hereinafter
referred to as “Account Substantiation Documents”).
 
2.1.3         If, at any time, the Revolving Loan exceeds the most current
calculated Borrowing Base of Borrowers in Lender's possession, Borrowers shall
immediately:
 
(a) repay to Lender, in cash, such amounts, plus interest thereon, as may be
necessary to eliminate such excess, and Lender may charge any Deposit Account of
any nature of Borrowers for such amount; or
 
(b) forthwith pledge, assign, transfer or grant Lender a continuing lien on and
security interest in and to, or deposit with Lender as part of the Collateral,
additional property satisfactory to Lender.
 
2.1.4         For the purpose of determining the existence of a Borrowing Base
sufficient to support the Revolving Loans from time to time outstanding
hereunder, Borrowers shall deliver to Lender weekly and at such other time or
times as Lender may specify, a Borrowing Base Certificate, an accounts
receivable aging report based upon invoice dates and an Inventory listing, in
form and content acceptable to Lender and copies of all Account Substantiation
Documents.
 
2.1.5         The Lender may, at its option, allow advances in excess of the
Borrowing Base (each, an “Overadvance”) on terms conditions and at pricing
determined by the Lender.
 
2.1.6         The Lender may, at its option, on not less than thirty (30) days’
written notice to Borrowers, permanently reduce the Revolving Credit Limit.
 
2.2           Lender’s Special Rights

2.2.1                 Lender (through any of its officers, employees, auditors
or agents) shall have the right in its sole discretion and without notice to
Borrowers at any time or times hereafter to:
 
 (a) confirm orders, Account Debtor balances and invoices and verify the
validity of Accounts, and/or invoices or any other matter relating to any
Account by mail, telephone, telegraph or otherwise, in the name of Borrowers or
Lender or any other name Lender so chooses;

(b) notify all Account Debtors that the Accounts have been assigned to Lender
and Lender has a security interest therein;
 
(c) direct all Account Debtors to make payment to Lender of all Accounts;

(d) enforce payment and collect, by legal proceedings or otherwise, any Accounts
in the name of Lender; and

(e) during Borrowers’ usual business hours, or during the usual business hours
of any third party having control over the Records of Borrowers,

(i) conduct such collateral examinations and audits Lender deems appropriate of
Borrowers’ booksand Records, and

(ii) inspect and verify Borrowers’ books and Records in order to verify the
amount or condition of,or any other matter relating to, the Collateral and
Borrowers’ financial condition.
 
2.2.2               Lender shall be entitled to conduct, from time to time
during the term of this Agreement, examinations of Borrowers’ business
operations, and Records and to check and test the same as to quality, quantity,
value and condition.  Borrowers will be obligated to pay or reimburse Lender for
the costs of such examinations.
 
2.3           Disbursement of the Loans.  On the next Business Day after
Borrowers’ application pursuant to Section 2.1 above, Lender will credit the
proceeds of the Loans to or for the benefit of Borrowers via wire transfer or
ACH to Borrowers’ operating account as Borrowers shall designate by written
notice to Lender, except for the payment of amounts due to or for the benefit of
Lender hereunder, which shall be made directly to Lender.
 
 
 

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2.4           Interest Rates and Payments of Interest.  Interest shall accrue
and be paid as follows:
 
2.4.1              Interest will accrue at the rate set forth in Schedule 2 and
made part hereof and shall be calculated on the basis of a 360-day year,
counting the actual number of days elapsed, on the greater of  One Million Five
Hundred Thousand Dollars ($1,500,000.00) or the principal balance of the Loans,
from time to time outstanding, and shall be payable on the first (1st) day of
each month commencing on the first (1st) day of the first month after the
Closing Date and continuing on the same day of each month thereafter until all
Obligations are satisfied in full.
 
2.4.2              If the rate is related to the Base Rate, each time the Base
Rate shall change, the Interest Rate on the Loans shall change contemporaneously
with such change in the Base Rate. If, at any time, any rate shall be deemed by
any competent court of law, Governmental Authority or tribunal to exceed the
maximum rate of interest permitted by any applicable Laws, then, for such time
as such Rate would be deemed excessive, application thereof shall be suspended
and there shall be charged in lieu thereof the maximum rate of interest
permissible under such Laws.
 
2.4.3              The Lender agrees to give the Borrowers next Business Day
availability on payments received and deposited into Lender’s account at
Wilmington Trust FSB (the “Concentration Account”).  Provided, however; that (a)
for the purpose of computing interest hereunder such items shall be applied by
Lender on account of the Revolving Loans the number of days equal to the Float
Factor described in Schedule 2 after same have been deposited into the
Concentration Account, and (b) no such item received by Lender shall constitute
payment to Lender unless such item is actually collected by the bank at which
Lender maintains its Concentration Account, presently, Wilmington Trust FSB.
 
2.5           Fees.  Borrowers hereby agree to pay the fees described on
Schedule 2 which shall constitute additional Obligations hereunder secured by
the Collateral. Any of such fees not paid when due shall bear interest from the
date due until paid at the interest rate specified in Paragraph 2.4.1.
 
2.5.1              Other Fees, Charges and Expenses.  The Borrowers shall
promptly pay to or on behalf of Lender from time to time the reasonable fees and
expenses of the Lender’s counsel, appraisers, environmental consultants,
auditors and other expenses of Lender in connection with this Agreement, the
Obligations and the Collateral, together with the costs described in Paragraph
3.4.3 hereof.
 
3.           COLLATERAL SECURITY.
 
3.1           Grant of Security Interests.  As security for the timely
satisfaction of all Obligations, each Borrower hereby  grants Lender a
continuing lien on and security interest in and to all of  the Borrowers’
Assets, including  Inventory, Accounts, General Intangibles, Equipment, Contract
Rights and those described in Schedule 3, wherever located, whether now owned or
hereafter acquired, together with all replacements therefor and all cash and
non-cash Proceeds (including, but without limitation, insurance Proceeds and
Proceeds of Proceeds) thereof, collectively called the "Collateral" which,
together with all of Borrowers’ other property of any kind held by Lender, shall
stand as one general, continuing collateral security for all Obligations of the
Borrowers to Lender and may be retained by Lender until all Obligations have
been satisfied in full.
 
3.2           Priority of Liens.  Except for the Liens set forth on Schedule 4
(“Permitted Liens”), Lender’s Liens in and to the Collateral shall be first and
prior Liens to all Liens against the Assets of each Borrower now existing or
hereafter arising ("Lender's Prior Security Interest").
 
3.3           Landlords' /Mortgagees’ Waivers.  Borrowers will cause each
landlord and mortgagee, of all premises leased or owned, wherein any of the
Collateral may be located, to execute and deliver to Lender instruments, in form
and substance satisfactory to Lender, by which such landlord or mortgagee waives
or subordinates its rights, if any, to the Collateral.
 
3.4           Financing Statements. Borrowers hereby:
 
3.4.1         authorize Lender to file any financing statements (including
amendments thereto and continuation statements thereof) in form satisfactory to
Lender as Lender may specify;
 
3.4.2         agree to take such other steps as Lender may direct, including the
noting of Lender's lien on the Collateral and on any certificates or documents
of title therefor, all to perfect Lender's liens on and security interests in
the Collateral; and
 
3.4.3         agree to pay or reimburse Lender for all costs and taxes of filing
or recording the same in such public offices as Lender may designate. In
addition to the foregoing, and not in limitation thereof, a carbon,
photographic, or other reproduction of this Agreement shall be sufficient as a
financing statement and may be filed in any appropriate office in lieu thereof.
 
 
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3.5           Each Borrower hereby irrevocably appoints Lender as its
attorney-in-fact (without requiring Lender to act as such) to execute any
financing statements, including amendments thereto and continuation statements
thereof in the name of each Borrower, and to perform all other acts and deeds
that Lender deems appropriate to perfect and continue its security interest in,
and to protect and preserve, the Collateral.
 
4.           OTHER PROVISIONS.
 
4.1           Lock Box. Borrowers will direct all of their Account Debtors to
forward payments directly to the lockbox facility (“Lock Box”) maintained with
Wilmington Trust FSB ("Lock Box Bank").  The Lock Box address is Box 513064,
Philadelphia, PA 19175-3064. Lender shall apply such payments to reduce the
outstanding Obligations.  In the event that Borrowers receive Remittances,
Borrowers agree that such Remittances shall be held in express trust for the
benefit of Lender which shall be immediately notified of such receipt. Borrowers
shall immediately upon receipt, turn over all Remittances to Lender in precisely
the form received, except for the endorsement of Borrowers when necessary to
permit the collection of the Remittances, which endorsement Borrowers hereby
agree to make.  Pending such deposit, Borrowers will not commingle any
Remittances (including all pre-payments) with any of its other funds or
property, but will hold them separate and apart therefrom expressly in trust for
Lender. Such statements, reports of collections and adjustments as Lender may,
from time to time, specify shall accompany all Remittances. All funds received
by Lender will be applied to reduce the Obligations, subject to
collection.  Borrowers shall have no right of access to or withdrawal from the
Lock Box.  Lender shall have no duty to segregate Proceeds of Collateral
remitted to the Lock Box, or deposited in the Concentration Account pursuant to
Paragraph 4.2 below, from other funds or property remitted to the Lock Box or
deposited in the Concentration Account.
 
4.2           Concentration Account.  All Proceeds of any Collateral shall be
deposited into the Concentration Account through the Lock Box, direct deposit by
Borrowers (or either of them)  or Account Debtor or otherwise. Borrowers hereby
absolutely assign to Lender all amounts now or hereafter due Borrowers in
connection with its Accounts. Borrowers shall, at the request of Lender, cause
all invoices of Borrowers forwarded to Account Debtors to notify such Account
Debtors to make all payments in connection with such invoices directly to the
Lender for deposit into the Concentration Account. It is further understood that
the Concentration Account is the Lender’s account and Borrowers agrees that
Borrowers shall have no right to withdraw monies from the Concentration Account.
 
4.3           Collections.  Lender may at any time, in the exercise of its
rights under Section 4.5, take control of the cash and non-cash Proceeds of any
of Borrowers’ Accounts, and charge the collection costs and expenses to a
deposit account of Borrowers, but, unless and until Lender does so or gives
Borrowers other written instructions, the collection of the Accounts shall be in
accordance with the terms and conditions of this Agreement.  The receipt of any
wire transfer of funds, check, or other item of payment by Lender shall be
applied to conditionally reduce the Obligations, but shall not be considered a
payment on account unless such wire transfer is of immediately available federal
funds and is made to the Concentration Account of Lender or unless and until
such check or other item of payment is honored when presented for payment.
 
4.3.1              The costs of all collection and enforcement proceedings
against any Account Debtor, including reasonable attorney's fees and out-of-
pocket expenses, shall be borne solely by Borrowers whether incurred by Lender
or by Borrowers.
 
4.4           Cash Collateral.  Until such time as the amounts now or hereafter
on deposit in any account are delivered to the Lender in accordance with the
provisions set forth in this Agreement, such amounts shall be deemed to be held
by Borrowers for the benefit of the Lender in express trust and such amounts
together with all amounts now or hereafter on deposit in the Concentration
Account shall be deemed to be "Cash Collateral" under Section 363 of the
Bankruptcy Code.  In the event that Borrowers (or either of them) file a
voluntary petition in Bankruptcy or are made subject to any involuntary
Bankruptcy proceeding, the Borrowers may not use such Cash Collateral without
the consent of the Lender and/or an order of any the Bankruptcy Court pursuant
to 11 U.S.C. § 363(b)(2).  The Borrowers hereby waive any right they may have to
assert that the Lender’s liens on and security interests in and to such amounts
and other like Collateral does not constitute Cash Collateral.

4.5           Power of Attorney.
 
4.5.1         Upon the occurrence of an Event of Default hereunder, which is not
cured within five (5) business days, after notice by Lender to Borrowers,
Borrowers hereby irrevocably authorize and empower Lender, grant a power of
attorney, coupled with an interest to, and appoint Lender, or any officer,
director or employee of Lender, as attorney-in-fact for  Borrowers, with full
authority for and on behalf of  Borrowers, and in its name, place and stead, to
take any action which Borrowers or any officer or director of Borrowers could do
if then present, as may, in the opinion of Lender, be necessary or advisable,
to;
 
(a) cause any amounts on deposit in any Deposit Account of  Borrowers (or either
of them) with any bank or other depository (“Depository”) to be transferred to
Lender including, without limitation, the power and authority to sign, seal,
execute and deliver for and on behalf of  Borrowers (or either of them), and in
their name, place and stead, any agreement, document or instrument of any
nature, including, without limitation, any Control Agreements, deposit
agreements, signature cards, corporate resolutions or as may otherwise be
required by any Depository at which Borrowers (or either of them)maintain any
account of any nature, to cause such Depository to transfer to Lender, all
amounts of Borrowers now or hereafter on deposit with such Depository;
 
 
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 (b) cause such Depository to provide to Lender all information in possession of
such Depository with respect to any accounts of Borrowers (or either of them),
of any nature, on deposit with such Depository, including, without limitation,
account balances, account statements, checks, drafts or other items drawn on
such account, deposit and withdraw tickets;
 
(c) change the name of any such account from Borrowers’ names to the name of the
Lender;
 
(d) give orders to any Depository with respect to any such accounts, including,
without limitation, orders to transfer the balances in any such accounts to
Lender; and
 
(e) take such other action as may in the opinion of Lender, be necessary to
cause all accounts now or hereafter on deposit in any such depository
institution to be transferred to Lender.

           4.5.2           Borrowers do hereby irrevocably designate, make,
constitute and appoint Lender (and any of Lender's officers, employees or agents
designated by Lender) as  Borrowers true and lawful attorney in fact (without
requiring them to act as such) coupled with an interest, with full power of
substitution, hereby ratifying and confirming all acts and deeds in connection
herewith, with power, without notice to Borrowers, and at such time or times
hereafter as Lender may in its sole election determine, in  Borrowers’ name and
at  Borrowers’ expense:
 
 (a) to endorse the name of Borrowers (or either of them) upon any and all
remittances, checks, drafts, money orders and other instruments for the payment
of monies that are payable to Borrowers and constitute collections on Borrowers’
Accounts or Proceeds of any insurance;
 
 (b) to demand payment of Accounts;
 
(c) to execute in the name of Borrowers any schedules, assignments, instruments,
documents, notices, and statements that Borrowers are obligated to give Lender
hereunder;
 
(d) to enforce payment of Accounts by legal proceedings or otherwise;
 
 (e) to exercise all of Borrowers’ rights and remedies with respect to the
collection of Accounts;
 
(f) to settle, adjust, compromise, extend or renew any Account;
 
(g) to settle, adjust or compromise any legal proceedings brought to collect an
Account;
 
 (h) to sell or assign any Account upon such terms, for such amounts and at such
time or times as Lender deems advisable;
 
(i) to discharge and release any Account;
 
 (j) to take control in any manner of any item of payment or proceeds of an
Account and for this purpose to notify the postal authorities to change the
address for delivery of mail addressed to Borrowers (or either of them) to such
address as Lender may designate and to receive, open and dispose of all mail
addressed to Borrowers (or either of them);
 
(k) to prepare, file and sign each Borrower’s name on any Proof of Claim in any
proceeding filed under Title 11 of the United States Code or similar document as
to an Account Debtor;
 
      (l) to prepare, file and sign each Borrower’s name on any Notice of Lien,
Claim of Mechanic's Lien, Assignment or Satisfaction of Lien or Mechanic's Lien,
or similar document in connection with an Account;
 
(m) to endorse the name of each Borrower upon any Chattel Paper, Document,
Instrument, Receivable, invoice, freight bill, Bill of Lading, Warehouse Receipt
or similar documents or agreement relating to any Inventory, Account or Goods
pertaining thereto;
 
(n) to execute in the name of each Borrower any Account Debtor notification; and
 
(o) to do all other acts necessary or desirable to protect each Borrower’s
interest in the Accounts and to enforce any Account or other Collateral.
 
4.5.3           Each Borrower releases Lender from any and all causes of action
or claims which each Borrower may now or hereafter have for any asserted loss or
damage to each Borrower claimed to be caused by or arising from:

 
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(a) any failure of Lender to protect, enforce or collect in whole or in part any
Account;

(b) Lender's notification to any Account Debtors of Lender's security interests
in any of the Accounts;

(c) Lender's directing any Account Debtors to pay any sums owing to Borrowers
directly to Lender; and

(d) any other act or omission to act on the part of Lender and any of its
officers, employees or agents designated by Lender except for willful
misconduct.

4.6           Additional Accounts.  Except for accounts listed on Schedule 4,
which are subject to a Control Agreement, Borrowers (or either of them) shall
not, without the prior written consent of Lender, open or maintain any Deposit
Accounts of any nature with any Depository.  Any Deposit Account shall, unless
otherwise agreed to by Lender, be subject to a Control Agreement and each
Borrower shall enter into with Lender, and cause each Depository to enter into
with Lender, a Control Agreement with respect to any account of Borrowers (or
either of them) now or hereafter maintained at any Depository.
 
4.7           Payments.   All payments of interest on and principal of the Loans
and /or the Obligations, all fees and all other sums payable to the Lender
hereunder shall be paid directly to the Lender in immediately available funds,
in such currency of the United States of America as is, at the time of payment,
legal tender for the payment of public and private debts.  Borrowers (or either
of them)  shall make each payment hereunder not later than 12:00 p.m., local
time, on the day when due, pursuant to Section 2.4.1 above and to the extent not
paid from funds received in the Lock Box, at the office of the Lender at 1235
Westlakes Drive, Suite 420, Berwyn, PA 19312.  Should any payment of principal
or interest or fees become due and payable on a Saturday, Sunday or legal
holiday under the laws of the Commonwealth of Pennsylvania, the payment date
thereof shall be extended to the next succeeding business day and such extension
of time shall in such case be included in computing such interest or fees, as
the case may be.  Any such payments or prepayments made shall be applied, first
to the payment of unpaid costs and charges due including late fees, then to
interest due and payable under the Revolving Loan Note and then to the reduction
of the outstanding principal balance thereof.  So long as a sufficient Borrowing
Base exists, all payments of principal, interest, costs, fees and expenses due
to the Lender in connection with this Agreement, the Loan Documents and the
Loans shall be made as follows:
 
4.7.1              Borrowers authorize and direct the Lender, at the Lender’s
option, to cause all interest and fees due and payable pursuant to this
Agreement in connection with the  Loans to be paid on the due date thereof by
charging all such interest payments and fees as and when due, as an advance
against the Revolving Credit, and each such advance shall be deemed to be a
Revolving Loan and shall bear interest from the date due until paid at the
interest rate specified in Paragraph 2.4.1.
 
4.7.2              Borrowers authorize and direct the Lender, at the Lender’s
option, to cure all costs, fees, taxes, charges and expenses of any kind or
description payable pursuant to this Agreement or paid or incurred by Lender
with respect to the Loans hereunder or any Collateral therefor or the Collection
of or realization upon same on the due date thereof to be paid by charging such
costs, fees or expenses as an advance against the Revolving Credit, each such
advance shall be deemed to be a Revolving Loan and shall bear interest from the
date due until paid at the interest rate specified in Paragraph 2.4.1.
 
4.7.3              Principal payable on account of the Revolving Loans shall be
due and payable to the extent and on the date of any collections received with
respect to any Proceeds of the Collateral if not otherwise applied to interest
or other Obligations, and the outstanding balance thereof shall be paid in full
on the earlier of the Revolving Credit Termination Date or on the acceleration
of the Obligations under and pursuant to this Agreement.
 
4.7.4              The balance of the Obligations, if any, shall be payable as
and when provided in this Agreement or other Loan Documents or in any other
agreements relating to such Obligation and, if not specified, then on DEMAND.
Unless expressly specified otherwise herein or in other Loan Documents, any of
such Obligations not paid when due shall bear interest from the due date until
paid at the interest rate specified in Paragraph 2.4.1 hereof.
 
4.7.5              Anything herein to the contrary notwithstanding, Borrowers
hereby authorize Lender, without further order or authorization of Borrowers, to
charge any of Borrowers’ Deposit Account(s) monthly, on the due date therefor,
for all payments of principal and interest and all other amounts due hereunder
and under the Notes.
 
4.8           Statements of Amount Due.  At least once each month, Lender shall
render to Borrowers a statement of Borrowers Indebtedness to Lender hereunder
plus interest accrued thereon, which statements shall be considered correct and
accepted by Borrowers, and conclusively binding upon Borrowers unless Borrowers
notify Lender to the contrary within ten (10) days from the date such statement
is delivered setting forth any error claimed by Borrowers.
 
 
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4.9           Joint and Several Obligations.  Each of the undersigned Borrowers,
if more than one, hereby irrevocably designates the other Borrower its
attorney-in-fact to borrow, sign and endorse the Revolving Loan Note, and
execute and deliver all instruments, documents, writings and further assurances,
required hereunder on its behalf.  Each Borrower authorizes Lender to pay over
or credit all Loan Proceeds to any Borrower for distribution among such
Borrowers, as their needs require.  Each of the Borrowers affirms and agrees
that all Loans, advances, obligations and liabilities hereunder and under the
Revolving Loan Note issued pursuant hereto shall be the joint and several
obligation of each Borrower, and that each Borrower shall make payment upon the
Revolving Loan Note issued pursuant hereto in accordance with its terms, or upon
its earlier maturity by acceleration, call or otherwise and that such Borrowers
shall in no way be affected by any extensions, renewals or forbearances granted
by Lender to them or any of them, failure of Lender to give them or any of them
notice of borrowing or other notice, any failure of Lender to pursue or preserve
its rights against them or any of them, the release by Lender of any Collateral
now or hereafter acquired or any guarantees or obligations, failure of Lender’s
best efforts in obtaining "commercially reasonable" prices for any Collateral
disposed of, and that such agreement by each of such Borrowers to pay upon the
Revolving Loan Note issued pursuant hereto is unconditional and does not require
prior recourse by Lender to any Collateral .
 
4.10           Increased Costs. If after the date of this Agreement, Lender
shall have determined that its costs (other than the Interest Rate and
Collateral Management Fee as defined in Schedule 2) of agreeing to make, or
making, funding or maintaining the Loans or Lender's obligations under this
Agreement have increased, then Lender shall so notify Borrowers (or either of
them) and within 15 days after receipt of such notice from Lender, Borrowers (or
either of them)  shall pay to Lender, from time to time as specified by Lender,
additional amounts that in the aggregate shall be sufficient to compensate
Lender for such increased cost. An increase in the Interest Rate and/or the
Collateral Management Fee as defined in Schedule 2, will result only from the
occurrence of an Event of Default hereunder which is not cured within five (5)
business days. A certificate as to such increase in costs showing the manner of
calculation thereof shall be submitted by Lender to Borrowers (or either of
them)   and shall, in the absence of manifest error, be conclusive as to the
amount thereof.  This covenant shall survive the termination of this Agreement
and payment of the Revolving Loan Note.
 
5.           CONDITIONS PRECEDENT.
 
Any obligation of Lender to make any of the Loans hereunder is subject to the
following conditions precedent:
 
5.1           Payments.  On or before the Closing Date, Borrowers shall have
paid:
 
(a) each of the Fees described in Paragraph 2.5;
 
(b) all charges, taxes and fees for recording, insurance, title insurance,
appraisals, environmental assessments and other items required under this
Agreement; and
 
(c) all costs and expenses of Lender in establishing the Loans and perfecting
its interest in the Collateral, including, without limitation, the reasonable
fees and disbursements of Lender's counsel.
 
5.2           Documents Required for the Closing.  Unless waived by Lender, on
or before the Closing Date, Borrowers or each of them shall have duly delivered
(or caused to be delivered) to Lender duly executed original counterparts of the
following, all in form and content acceptable to Lender:
 
5.2.1              This Agreement;
 
5.2.2              The Revolving Loan Note;
 
5.2.3              A fully completed and executed Perfection Certificate;
 
5.2.4              Disclosures for Confession of Judgment of Borrower;
 
5.2.5              Validity Certificates;
 
5.2.6              A Surety Agreement from each Surety;
 
5.2.7              Subordination Agreement(s) from any Person(s) with an
interest in or to whom any Subordinated Debt is payable, in favor of Lender with
respect to such Subordinated Indebtedness, if any;
 
5.2.8              The UCC-1 financing statements as required by Lender;
 
5.2.9              UCC-3 Termination Statements with respect to any security
interest of record in any of the Collateral prior to the date hereof in favor of
any Person other than Lender;
 
5.2.10            Landlord waivers and mortgagee waivers with respect to any
leased or mortgaged premises of Borrower in which any Collateral is located, and
as otherwise required in this Agreement;
 
5.2.11            Control Agreement(s) with consent of Depository, to the extent
applicable;
 
5.2.12            A certified copy of the Borrowers’ fire, all risk, business
interruption, public liability, flood and casualty insurance policy or policies
evidencing coverage satisfactory to the Lender, with mortgagee and lender loss
payable and additional insured endorsements in form and substance satisfactory
to the Lender naming the Lender as mortgagee and loss payee and additional
insured, as its interest may appear, together with one or more certificates of
insurance broker(s) satisfactory to the Lender (Accord 27), setting forth the
insurance obtained in accordance with Paragraph 7.1.4 and stating that such
insurance is in full force and effect, all premiums then due thereon have been
paid and the insurance policies relating thereto comply with Paragraph 7.1.4,
and such insurance is adequate and providing not less than 30 days notice to
Lender of any change or cancellation of such coverages;
 
 
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5.2.13            The initial Borrowing Base duly completed and executed by
Borrowers;
 
5.2.14            Current Aging of Borrowers’ Accounts based upon invoice date
containing information satisfactory to Lender;
 
5.2.15            Copies of all Account Substantiation Documents in effect as of
the Closing Date, if required by Lender;
 
5.2.16            A tax clearance certificate from each state for which
Borrowers, each Subsidiary or other entity constituent of Borrowers, if any, is
required to pay any sales and use taxes, evidencing payment of all sales and use
taxes owed by any of them as of the Closing Date:
 
5.2.17            A certified (as of the date of the Closing) copy of
resolutions of each Borrower and each Subsidiary or other entity constituent of
each Borrower, if any, boards of directors or other governing agency authorizing
the execution, delivery and performance of this Agreement, the Revolving Loan
Note, the Collateral and Loan Documents and each other document to be delivered
pursuant hereto;
 
5.2.18            A certified (as of the date of the Closing) copy of each
Borrower and each Subsidiary or other entity constituent of each Borrower, if
any, by-laws, operating agreement, partnership agreement or other governing
documents and all amendments to the foregoing;
 
5.2.19            A certificate (dated the date of the Closing) of each Borrower
and each Subsidiary or other entity constituent of each Borrower, if any, as
applicable, corporate secretary or other authorized officer, member or partner
as to the incumbency and signatures of the officers, members, partners,
Authorized Financial Officer(s) or authorized persons of each Borrower, and each
Subsidiary or other entity constituent of each Borrower, if any, signing this
Agreement, the Notes, the Collateral and Loan Documents and each other document
to be delivered pursuant hereto;
 
5.2.20            A copy, certified as of the most recent date practicable by
the Secretary of the State of each entity's state of formation, of each
Borrower’s, each Subsidiary’s or other entity constituent of each Borrower, if
any, certificate of incorporation, partnership or formation, together with a
certificate (dated the date of the Closing) of each Borrower’s and each
Subsidiary’s or other entity constituent of each Borrower, if any, as applicable
corporate secretaries or other authorized Person to the effect that such
certificate of incorporation, partnership or formation has not been amended
since the date of the aforesaid certification;
 
5.2.21            Certificates, as of the most recent dates practicable, of the
aforesaid Secretary of State and the Secretary of State of each state in which
each Borrower, each Subsidiary or other entity constituent of each Borrower, if
any, is qualified as a foreign corporation, partnership, limited liability
company or other entity and the department of revenue or taxation of each of the
foregoing states, as to the good standing of each Borrower, each Subsidiary or
other entity constituent of each Borrower, if any;
 
5.2.22            Mortgage and Lien satisfactions as may be necessary to provide
Lender a first Lien on and security interest in the Collateral subject to
Lender’s Priority Security Interest, to the extent applicable;
 
5.2.23            Copies of all documents evidencing the terms and conditions of
any Debt specified as Subordinated Indebtedness or any collateral therefor, or
Borrowers’ representation that no such documentation exists;
 
5.2.24            Master address list of each Borrower's Account Debtors;
 
5.2.25            Collateral Assignments to Lender of all copyrights, trademarks
and patents of each Borrower, if any, included in the Collateral;
 
5.2.26            A certified copy of fictitious name registration of Borrowers
(or either of them) .
 
5.2.27            Such other agreements, documents or instruments required by
Lender, or its counsel, to evidence the transactions described in this Agreement
and perfect the Liens and security interests of Lender in the Collateral.
 
5.3           Miscellaneous Conditions
 
5.3.1              The audit of each Borrower's Collateral shall have been
performed by Lender, the results of which shall be satisfactory to Lender, in
its sole discretion.
 
5.3.2              Lender shall have received UCC, Lien, tax, judgment and other
searches required by Lender.
 
 
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5.3.3              Lender shall have received copies of all filing receipts and
acknowledgments issued by any governmental authority to evidence any recordation
or filing necessary to perfect the Lien of the Lender on the Collateral and
evidence in a form acceptable to the Lender that such Lien constitutes the
Lender’s Prior Security Interest and is a valid and perfected lien subject only
to Permitted Liens as set forth on Schedule 4.
 
5.4                      Legal Matters.  At the time of Closing and each
subsequent disbursement, all legal matters incidental thereto shall be
reasonably satisfactory to Lender and its counsel.
 
6.           REPRESENTATIONS AND WARRANTIES.
 
6.1           Corporate Existence, etc.  To induce Lender to enter into this
Agreement, each Borrower represents and warrants to Lender as follows:
 
6.1.1 Borrowers are duly organized and validly existing, and in good standing
under the laws of the State of Illinois and have the lawful power to own, lease,
encumber and operate their assets and properties and to engage in the business
they conduct, and are duly qualified and in good standing as a foreign
corporation in the jurisdictions wherein the nature of the business transacted
by their or property owned by them makes such qualification necessary. The
addresses of all places of business of each Borrower are as set forth in the
Perfection Certificate. Borrowers have no Subsidiaries or other entities
constituent of Borrowers, or Affiliates except as described in the Perfection
Certificate. Borrowers, except as disclosed to Lender, have not changed their
names, been the surviving entity in a merger, acquired any business, or changed
their principal executive offices within five (5) years and one (1) month prior
to the date hereof;
 
6.1.2 Borrowers have the requisite power and authority, corporate, partnership,
limited liability company or otherwise, to enter into and perform this
Agreement, the Revolving Loan Note and the Loan Documents to which they are a
party and to incur the Obligations herein and therein provided for and have
taken all proper and necessary action to authorize the execution, delivery and
performance of this Agreement, the Revolving Loan Note and the Loan Documents
which are duly and validly executed and constitute legal, valid, and binding
obligations of Borrowers enforceable in accordance with their respective terms;
 
6.1.3              Borrowers are  not in default with respect to any of  their
existing Indebtedness including without limitation any Federal, State, Local,
payroll, sales, use, excise or similar taxes, or under any agreement,
commitment, lease, contract, deed of trust, mortgage, note or other Instrument,
and the making and performance of this Agreement, the Revolving Loan Note and
the Loan Documents will not immediately, with the passage of time, with the
giving of notice or both: (a) violate the charter, by-laws, partnership
agreement, operating agreement, or other organizational documents of each
Borrower or, in any material respect, violate any Laws, rule, regulation, order,
writ, judgment, injunction, decree, determination or award applicable to each
Borrower; or (b) result in a default under any contract, agreement, indenture,
note, loan or credit agreement, license, lease or instrument to which each
Borrower is a party or by which it or its property is bound; or result in the
creation or imposition of any security interest in or Lien or encumbrance upon
any of the Assets of each Borrower except such as are in favor of Lender;
 
6.1.4              No holder of any Indebtedness of each Borrower has given
notice of any asserted default thereunder.  No liquidation or dissolution of
each Borrower and no receivership, insolvency, bankruptcy, reorganization or
other similar proceeding relative to each Borrower or their properties is
pending or, to the knowledge of each Borrower, threatened against them;
 
6.1.5              Except as described in Schedule 4, there are no pending
orders, notices, litigation, actions, claims, suits, proceedings or
investigations pending, or, to the knowledge of Borrowers, threatened or
reasonably anticipated against or affecting the Borrowers (or either of them) at
law or in equity or before or by any governmental instrumentality or agency
(domestic or foreign), commission, board, bureau, arbitrator or arbitration
panel which may be expected to result in any Material Adverse Change in the
business, operations, prospects, properties or Assets (including, without
limitation, the Collateral), or condition (financial or otherwise) of  the
Borrowers (or either of them) .  There is no judgment, liability or award, which
may be expected to result in any Material Adverse Change in the business,
operations, prospects, properties or Assets (including, without limitation, the
Collateral), or condition (financial or otherwise) of the Borrowers (or either
of them).  the Borrowers (or either of them) are not in default with respect to
any judgment, order, writ, injunction, decree, rule, award or regulation of any
court, governmental instrumentality or agency, commission, board, bureau, or
arbitrator or arbitration panel;
 
6.1.6              The Borrowers (or either of them) do not know of, or
anticipate any Material Adverse Change in their Assets, Liabilities, properties,
business, or condition (financial or otherwise);
 
6.1.7              The Borrowers (or either of them) have good and marketable
title to all of their properties and Assets, subject to no security interest,
encumbrance or Lien, or the claim of any third person, except for Permitted
Liens;
 
6.1.8              The Financial Statements presented and to be presented to
Lender, including any related schedules and notes appended thereto, have been
and will be prepared in accordance with GAAP and fully and fairly present in all
material respects the financial condition of each Borrower and the Borrowers at
the dates thereof and the results of operations for the periods covered
thereby.  There have been no Material Adverse Changes in the financial condition
or business of the Borrowers (or either of them) from the date such Financial
Statements were presented to Lender to the date hereof;
 
 
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6.1.9              As of the date hereof, the Borrowers (or either of them) do
not have any direct or contingent liability or material Indebtedness of any
nature, including, without limitation, liabilities for taxes and any interest or
penalties relating thereto, except to the extent reflected (in a footnote or
otherwise) and reserved against in the Financial Statements of the Borrowers (or
either of them) delivered to Lender prior to the date hereof or as disclosed in
Schedule 4. The Borrowers (or either of them)  do not know and have  no
reasonable grounds to know of any basis for the assertion against the Borrowers
(or either of them) of any material Indebtedness of any nature not fully
reflected and reserved against in their Financial Statements;
 
6.1.10            Each Borrower and the Borrowers  have filed or caused to be
filed all federal, state and local tax returns and other reports they are
required by Law to file prior to the date hereof and which are material to the
conduct of  their business, or have timely filed requests for extensions to file
the same as permitted by Law, and have  paid or caused to be paid all taxes,
assessments and other governmental charges due and payable prior to the date
hereof, and have made adequate provision for the payment of such taxes,
assessments or other charges accruing but not yet payable.  The Borrowers (or
either of them)  do not have any knowledge of any deficiency or additional
assessment in a material amount in connection with any taxes, assessments or
charges not provided for on their books and Records;
 
6.1.11            Each Borrower and the Borrowers have complied in all material
respects with all applicable Laws with respect to:
 
 (a) any restrictions, specifications or other requirements pertaining to
products that the Borrowers (or either of them) import, manufacture or sell or
to the services they perform;
 
 (b) the conduct of their business and
 
 (c) the use, maintenance and operation of the real and personal properties
owned or leased by them in the operation of  their business;
 
6.1.12            No representation, warranty or statement by the Borrowers (or
either of them) contained herein or in any certificate or other document
furnished pursuant hereto contains any untrue statement of material fact or
omits to state a material fact necessary to make such representation or warranty
not misleading in light of the circumstances under which it was made;
 
6.1.13            No recording, filing, registration, notice or other similar
action is required in order to insure the legality, validity, binding effect or
enforceability of this Agreement or the Revolving Loan Note or the other
documents and instruments executed hereunder as against all persons, other than
such filings as may be required under the UCC and mortgages to perfect Lender’s
interest in all real property owned by the Borrowers (or either of them);
 
6.1.14            Except as described on Schedule 4, there are no Liens or
security interests in any of  the Borrowers’ Assets and Borrowers(or either of
them)  do  not know of any circumstances which might lead to the imposition of
any Lien and Borrowers have not entered into any loan or security agreement with
any third person, including an Affiliate.
 
6.1.15            Except as described on Schedule 4, Borrowers (or either of
them) do not have any material leases, contracts or commitments of any kind
(such as employment agreements; collective bargaining agreements; powers of
attorney; distribution arrangements; patent, trademark or copyright license
agreements; contracts for future purchase or delivery of goods or rendering of
services; bonus, pension and retirement Plans; or accrued vacation pay,
insurance and welfare agreements); all parties (including the Borrowers) to all
such material leases, contracts and other commitments have complied with the
provisions of such leases, contracts and other commitments; no party is in
default under any thereof and no event has occurred which, but for the giving of
notice or the passage of time or both, could constitute a default;
 
6.1.16            Schedule 4 contains a complete and accurate list and summary
description of all Intellectual Property owned, licensed, leased or in any way
used by the Borrowers (or either of them).  None of the Intellectual Property
infringes upon or interferes with any other Intellectual Property or is being
infringed upon or interfered with by any other Intellectual Property.  None of
the Intellectual Property has been challenged or threatened in any way.  The
Intellectual Property is not a substantial part of the business of Borrowers and
the Intellectual Property is not necessary for the operation of Borrowers’
business.
 
6.1.17            Each Borrower and the Borrowers are in compliance in all
material respects with all applicable provisions of ERISA;
 
6.1.18            Each Borrower and the Borrowers do not have any Defined
Benefit Pension Plan, as that term is defined in ERISA;
 
 
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6.1.19            Except as disclosed in the Financial Statements or on Schedule
4, or in the ordinary course of  Borrowers’ business, no officer of Borrowers
(or either of them) , and no other Affiliate of Borrowers (or either of
them)   is currently a party to any transaction with Borrowers (or either of
them), including, without limitation, any contract, agreement or other
arrangement providing for the employment of, furnishing of advisory or other
services by, rental of real or personal property from, or otherwise requiring
payments to, any such officer or Affiliate;
 
6.1.20            No Event of Default has occurred and is continuing or is about
to occur;
 
6.1.21            The Obligations and Indebtedness of each Borrower and the
Borrowers  under this Agreement, the Revolving Loan Note and any other Loan
Document are not subordinated in right of payment or otherwise to any other
obligation of the  Borrowers (or either of them) or to the rights of others;
 
6.1.22            There are no strikes, work stoppages, material grievance
proceedings or other material controversies pending or, to the best of  the
Borrowers’ knowledge, threatened between the Borrowers and any employees engaged
in the business of the Borrowers or any union or other collective bargaining
unit representing such employees.  Borrowers have complied and are in compliance
with all Laws relating to the employment of labor, including, without
limitation, provisions relating to wages, hours, collective bargaining,
occupational safety and health, equal employment opportunities and the
withholding of income taxes and social security contributions, the
non-compliance of which might have a Material Adverse Effect on its business,
operations, prospects, Assets, properties or condition (financial or otherwise);
 
6.1.23            Except as disclosed to Lender in Schedule 4, Borrowers (or
either of them) shall not pay any commission or finder's fee payable in
connection with the Loans;
 
6.1.24            Each Account is:
 
(a) genuine and authentic,
 
(b) in all respects, what it purports to be, and
 
(c) represents the bona fide sale of Goods or performance of services in the
ordinary course of each of  the Borrower’s business to the Account Debtor named
in each such Account.  The amount set forth on the invoice or other billing
statement for such Account is true and correct.  Each Account used as a base for
borrowing hereunder is an Eligible Account;
 
6.1.25            Borrowers (or either of them) are  not party to or bound by
any agreement or instrument or subject to any corporate or other restriction the
performance or observance of which now has or, as far as Borrowers can
reasonably foresee, may have a Material Adverse Effect, financial or otherwise,
upon the Assets or business of Borrowers (or either of them).
 
6.1.26            Borrowers (or either of them) are not now and will not be
engaged principally or, as one of their important activities, in the business of
extending credit for the purpose of purchasing or carrying or trading in any
margin stocks or margin securities (within the meaning of Regulation G, T, U or
X of the Board of Governors of the Federal Reserve System) or other securities,
and no part of the proceeds of the Loans hereunder has been or will be applied
for the purpose of purchasing or carrying or trading in any such stock or
securities or of refinancing any credit previously extended, or of extending
credit to others, for the purpose of purchasing or carrying any such margin
stock, margin securities or other securities in contravention of such
Regulations.
 
6.1.27            Borrowers (or either of them) do not operate or do business
under any assumed, trade or fictitious names except as described in the
Perfection Certificate.
 
6.1.28            To the actual knowledge of Borrowers (or either of them), no
director, employee, principal shareholder or Control Person of  Borrowers (or
either of them) is a director, employee, principal shareholder or Control Person
of Lender and no employee, partner or Control Person of Lender is in Control of
Borrowers (or either of them).
 
6.1.29            There is no activity at any real property or facility owned or
operated by Borrowers (or either of them) (each a "Property") which has been
conducted, or is being conducted, except in compliance with all Environmental
Laws, statutes, ordinances, regulations, orders, and requirements of common law
concerning (a) those activities, (b) repairs or construction of any
improvements, (c) handling or storing of any materials, (d) discharges to the
air, soil, surface water or ground water, and (e) storage, treatment or disposal
of any waste at or connected with any activity at any Property.
 
6.1.30            There is not any contamination on the Property, nor to the
best of each Borrower’s knowledge has there been any contamination on the
Property.  As used in this Agreement, the term "contamination" shall mean the
uncontained presence of hazardous substances at the Property, or arising from
the Property, which may require remediation under any applicable law; and the
term "hazardous substances" shall mean "hazardous substances" or "contaminants"
or "regulated substances" as defined pursuant to any applicable Environmental
Laws, if such presence would require removal or remediation thereof under such
Environmental Law.
 
 
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6.1.31            Borrowers (or either of them) do not know of any chemical,
material or substance, exposure to which is prohibited, limited or regulated by
a federal, state or local government agency, authority or body, or which, even
if not so regulated, to the best of each Borrower’s knowledge after due
investigation, may or could pose a hazard to health and safety of the occupants
of the Property or the owners or occupants of property adjacent to or in the
vicinity of the Property.
 
6.1.32            Borrowers (or either of them) do not know of any investigation
of any Property for the presence of radon or radon gas or the presence of the
radioactive decay products or radon.
 
6.1.33            No tanks presently or formerly used for the storage of any
liquid or gas above or below ground are present on any Property.
 
6.2           Solvency.  Each Borrower has sufficient capital, including the
Loan contemplated hereunder, to carry on all businesses and transactions in
which it now engages or is about to engage, is solvent and will continue to be
solvent after incurring the Loan and creating security interests of Lender in
the Collateral.
 
6.3           Investment Company.  Each Borrower is not an "investment company,"
or a company "controlled" by an "investment company," within the meaning of the
Investment Company Act of 1940, as amended.
 
6.4           Survival.  All of the representations and warranties set forth in
Paragraph 6.1 shall survive the expiration or termination of this Agreement and
the other Loan Documents.
 
6.5           Names and addresses of Borrowers.
 
6.5.1              The addresses of all places of business of Borrowers and each
trade name and trade style utilized by each Borrower and the address related to
each such name are as set forth in the Perfection Certificate.
 
6.5.2              The addresses where each Borrower keeps the Collateral and
its books and Records concerning the Collateral are as set forth in the
Perfection Certificate.
 
6.5.3              The addresses at which Assets are located are as set forth in
the Perfection Certificate.
 
7.           BORROWERS’ COVENANTS.
 
7.1           Affirmative Covenants.  Each Borrower and the Borrowers do hereby
covenant and agree with Lender that, so long as any of the Obligations remain
unsatisfied, they will:
 
7.1.1              Furnish Lender:
 
 (a) within twenty (20) days after the close of each monthly accounting period
in each fiscal year of each Borrower and the Borrowers, a balance sheet and
income statement of each Borrower and the Borrowers as of the end of such
monthly accounting period, prepared by the Authorized Financial Officer of each
Borrower and the Borrowers, all in reasonable detail and subject to year-end
adjustments, all prepared in accordance with GAAP, together with such other
financial statements prepared by each Borrower and the Borrowers for management
during such monthly period;
 
 (b) within forty-five (45) days after the close of each quarterly accounting
period in each fiscal year of each Borrower and the Borrowers, consolidated and
consolidating income statements and balance sheets and statements of changes in
financial position of each Borrower and its Affiliates, if any, and the
Borrowers, all as of the end of such quarterly period, prepared by the
Authorized Financial Officer of each Borrower, all in reasonable detail, and
prepared in accordance with GAAP;
 
(c) within ninety (90) days after the close of each fiscal year of each Borrower
and the Borrowers:
 
 (i) Consolidated and consolidating income statements and balance sheets of each
Borrower, and its Affiliates, if any, and the Borrowers all as of the end of
such fiscal year; and
 
(ii) Consolidated and consolidating statement of stockholders’ equity and a
statement of changes in financial position; all in reasonable detail, including
supporting schedules and comments, such annual statements, to be reviewed by
an  independent certified public accountant selected by each Borrower, and
acceptable to Lender,  to have been prepared in accordance with GAAP.  Lender
shall have the right, from time to time, to discuss each Borrower’s financial
affairs directly with each Borrower’s independent certified accountants;
 
 (d) contemporaneously with each
 
(i) monthly and quarterly report required by the foregoing paragraphs, a
certificate of the Authorized Financial Officer of each Borrower, and
 
 
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 (ii) year-end financial report required by the foregoing paragraphs, a
certificate by an Authorized Financial Officer of each Borrower, in each case
stating that the signer of such certificate has individually reviewed the
provisions of this Agreement and that a review of the activities of each
Borrower during such monthly, quarterly or yearly period, as the case may be,
has been made by or under the supervision of the signer of such certificate with
a view to determining whether each Borrower  has kept, observed, performed and
fulfilled all their obligations under this Agreement, and that, to the best of
his/her knowledge, each Borrower  has observed and performed each and every
undertaking contained in this Agreement and is not at the time in default in the
observance or performance of any of the terms and conditions hereof or, if each
Borrower shall be so in default, specifying all such defaults and events of
which he/she may have knowledge and the proposed cure of such defaults;
 
 (e) at Lender’s request, copies of all receipts, if available or other evidence
of the payment, of United States withholding, FICA and other applicable state
and local payroll taxes, as such payments are made, and copies of each
quarterly, or as otherwise required by the Internal Revenue Service, FICA and
FUTA income tax withholding forms filed by each Borrower, each Borrower,
acknowledges that each Borrower is responsible for the timely payment, when due,
of all such taxes;
 
(f) within five (5) days after the close of each calendar month, a Borrowing
Base Certificate, an accounts receivable and accounts payable aging and listing
all as of the end of the immediately preceding month in form satisfactory to
Lender.  All agings submitted hereunder shall reflect an allocation to the
corresponding invoice(s) of any and all payments or credits (or any part
thereof) received or given by Borrowers (or either of them);
 
(g) within five (5) days after the close of each calendar month, and at Lender’s
reasonable request, in form satisfactory to Lender, an Accounts reconciliation
which sets forth, together with such other information requested by Lender, a
listing of all miscellaneous debits and credits to Borrowers,  Accounts,
sufficient in detail to enable Lender to reconcile the differences, if any,
between the balance of Borrowers,  Accounts as shown on Lender's books and
Records, and the balance of such Accounts shown on Borrowers,  books and
Records.  Upon receipt of such reconciliation, the value of Borrowers,  Accounts
on Lender's Records shall be adjusted as appropriate and shall be reflected by
Borrowers  in the next Borrowing Base submitted by Borrowers to Lender
hereunder;
 
(h) within five (5) days after the close of each calendar month, and at Lender’s
reasonable request, an update and list of all changes to the master address list
of each Borrower’s Account Debtors;
 
(i) at Lender's request, all Shipping Documents evidencing the shipment of Goods
which gave rise to the Accounts, completion certificates or other proof of the
satisfactory performance of services that gave rise to an Account, and each
Borrower’s copy of any written order or contract that gave rise to the Account;
 
(j) weekly, on or before Tuesday of each week for the calendar week ending on
the Friday of the immediately preceding week, a Borrowing Base Certificate of
Borrowers.;
 
 (k) at Lender’s request, Borrowers  shall submit copies of the invoices for
each Account of Borrowers  and sales journals or such other Records acceptable
to Lender.;
 
(m) within ten (10) days after filing, copies of the federal income tax returns
filed (together with all schedules) or extensions requested by each Borrower ;
and
 
(n) such additional financial information regarding  each Borrower and the
Borrowers  and its operations and financial condition as Lender may, from time
to time, reasonably require;
 
7.1.2              Cause Surety, if any, to furnish to Lender:
 
(a) not later than ninety (90) days after the close of each calendar year,
financial statements of Surety, in form and content acceptable to Lender;
 
(b) within 10 days of filing, copies of Surety’s federal tax returns (together
with all schedules) or extensions requested by Surety; and
 
(c) such other financial information regarding Surety as Lender may, from time
to time, require;
 
7.1.3              Maintain the Collateral and its other properties in good
condition and repair (normal wear and tear excepted) and will pay and discharge
or cause to be paid and discharged when due the costs of repairs to or
maintenance of the same and will pay or cause to be paid, all rental or mortgage
payments due on the real estate owned or leased by Borrowers (or either of
them). Borrowers (or either of them) hereby agree that in the event Borrowers
(or either of them) fail to pay or cause to be paid any such payment, Lender may
do so and be immediately reimbursed by Borrowers (or either of them) therefor;
 
 
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7.1.4              Maintain or cause to be maintained, take out, pay for and
keep in effect or cause to be taken out, paid for, and kept in effect, so long
as the Obligations remain unsatisfied, such insurance against risks, including
without limitation, commercial general liability and property damage, business
interruption, fire and extended coverage with respect to the Collateral owned by
Borrowers (or either of them) (to the extent of its full insurable replacement
value), vandalism and malicious mischief and sprinkler leakage coverage and
coverage against such other hazards, as are customarily insured against by
companies in the same or similar business, and such other hazards as Lender may,
from time to time reasonably require, including flood hazard to the extent any
Property is located in an area designated or identified as an area having
specified flood hazards, all in amounts and with such insurance carriers as may
be satisfactory to Lender, and will deliver to Lender, upon their issuance,
insurance policies for all insurance then in force.  All renewal and substitute
policies of insurance shall be delivered to Lender, premium paid, at least
fifteen (15) days prior to the termination of the policies previously delivered
to Lender.  All such insurance policies will name Lender as loss payee and/or
additional insured, as required by Lender, and contain a provision whereby they
may not be canceled or amended except upon thirty (30) days written notice to
Lender and shall be endorsed with a standard mortgagee or loss payee clause, as
applicable, in favor of Lender and not subject to contribution.  Borrowers (or
either of them) shall cause all hazard insurance policies and any policies
insuring the Collateral covered by this Agreement to provide, and the insurers
issuing such policies to certify to Lender, that:
 
 (a) the interest of Lender shall be insured regardless of any warranties,
declarations and conditions contained in such policies;
 
(b) if such insurance be proposed to be canceled or materially changed for any
reason whatsoever, such insurer will promptly notify Lender and such
cancellation or change shall not be effective as to Lender for thirty (30) days
after receipt by Lender of such notice, unless the effect of such change is to
extend or increase coverage under the policy;
 
(c) Lender will have the right at its election to remedy any default in the
payment of premiums within thirty (30) days of notice from the insurer of such
default; and
 
(d) loss payments in each instance will be payable to Lender as mortgagee or
secured party, or otherwise as its interest may appear.  So long as there is no
Event of Default, Borrowers  may apply such Proceeds toward the repair or
replacement of any Collateral of Borrowers that has been damaged or destroyed
and in respect of which the insurance Proceeds were payable.  If the amount of
the casualty is less than $25,000, Borrowers may deal with the insurer directly
to make any claims.  Upon the occurrence of an Event of a Default, without
limitation of the foregoing, such Proceeds may be applied at Lender’s option in
whole or in part toward (i) the repair or replacement of any Collateral of
Borrowers that has been damaged or destroyed and in respect of which the
insurance Proceeds were payable or (ii) the payment or prepayment of the
outstanding principal of any of the Obligations and interest accrued
thereon.  From and after the occurrence, and during the continuation of an Event
of Default, Borrowers hereby irrevocably appoint Lender as their agent to sign
and endorse any and all checks, drafts or other instruments payable to Borrowers
representing insurance Proceeds, and to satisfy any and all claims in connection
therewith;
 
7.1.5              Pay or cause to be paid when due, all taxes, assessments and
charges or levies imposed upon them or on any of their property or which they
are required to withhold and pay over, except where contested in good faith by
appropriate proceedings with adequate reserves therefor having been set aside on
their books; but Borrowers shall pay or cause to be paid all such taxes,
assessments, charges or levies forthwith whenever foreclosure on any lien that
attaches (or security therefor) appears imminent;
 
7.1.6              To the extent required by the Lender, maintain the Financial
Ratios set forth in Schedule 2 attached hereto and made part herof;
 
7.1.7              Collect its Accounts only in the ordinary course of business;
 
7.1.8              Keep accurate and complete in all material respects, books
and Records relating to Accounts, Inventory, receivables, other Collateral, and
business affairs consistent with sound accounting practices; keep complete and
accurate Records (including all books of original and final entry, computer
programs, software, stored material and data banks associated with or arising
out of their business, operations and/or record keeping) and make all necessary
entries therein to reflect the transactions and facts giving rise to Accounts,
Chattel Paper, Inventory, receivables and other Collateral, and all payments,
debits, credits and adjustments applicable thereto;
 
7.1.9              Give prompt notice to Lender of:
 
 
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(a) any litigation in which Borrowers (or either of them) is a party to the
extent the liability of Borrowers (or either of them) in respect of such
litigation is reasonably expected to exceed $10,000, and
 
(b) the institution of any other suit or any administrative proceeding against
Borrowers, or either of them that might materially and adversely affect its
individual operations, financial condition, property or business; and
 

7.1.10            Maintain financial records in accordance with GAAP and, upon
reasonable notice by Lender, permit any authorized representative designated by
Lender to visit at reasonable times and inspect any of the Properties of
Borrowers (including, without limitation, their books of account, Records,
correspondence and other papers and to make extracts therefrom) and to discuss
its affairs, finances and accounts with its officers and its independent
certified public accountants or other parties preparing statements for or on
behalf of Borrowers;
 
7.1.11            Maintain its corporate, partnership, limited liability company
or other entity existence in good standing; make no material change in the
nature or character of its business and not engage in any business which is
materially different from the business in which it is currently engaged;
maintain and keep in full force and effect all licenses and permits necessary to
the proper conduct of its business; and operate its business strictly in
accordance with applicable federal, state and local law;
 
7.1.12            Execute such other and further documents, including, without
limitation, indemnity agreements, deeds of trust, security agreements, Pledge
Agreements, Control Agreements, assignments, financing statements, continuation
statements and the like as may, from time to time, in the reasonable opinion of
Lender or Lender's counsel, be necessary to perfect, confirm, establish,
reestablish, continue or complete Lender's security interest in the Collateral
and the purposes and intentions of this Agreement, it being the intention of
Borrowers to provide hereby a full and absolute warranty of further assurance to
Lender.  If Borrowers (or either of them) fail to execute any such documents
within five (5) days of being reasonably requested to do so by Lender, Borrowers
(or either of them) hereby appoint Lender or any officer of Lender as Borrowers’
attorney-in-fact for purposes of executing such documents in Borrowers’ names,
place and stead, which power of attorney shall be considered to be coupled with
an interest and irrevocable;
 
7.1.13            Notify Lender immediately of the occurrence of any Event of
Default hereunder, under the agreements, documents or instruments, evidencing
Loans by Lender to Borrowers (or either of them) or of any fact, condition or
event that only with the giving of notice and/or passage of time, or both would
become an Event of Default, or of the failure of Borrowers (or either of them)
to observe any of its undertakings hereunder;
 
7.1.14            Notify Lender ninety (90) days in advance of any change in the
location of any of its places of business or of the establishment of any new or
the discontinuance of any existing place of business and furnish to Lender any
new or replacement UCC-1 financing statements, duly signed by Borrowers (or
either of them) necessary to keep perfected Lender's security interest in the
Collateral;

7.1.15            Pay when due (or within applicable grace periods) all
Indebtedness due third Persons, except when the amount thereof is being
contested in good faith, by appropriate proceedings and with adequate reserves
therefor being set aside on the books of Borrowers (or either of them).  If
default be made by Borrowers (or either of them) in the payment of any principal
(or installment thereof) of, or interest on, any such Indebtedness, the Lender
shall have the right, in its discretion, to pay such interest or principal for
the account of Borrowers (or either of them) and be reimbursed by Borrowers (or
either of them) therefor;
 
7.1.16            Furnish, or cause to be furnished to Lender, any information
regarding Borrowers (or either of them) or any Subsidiaries’ or Affiliates’
business affairs and financial condition within a reasonable time after request
therefor;
 
7.1.17            Permit Lender, its officers, employees, designees and agents
to have access, to inspect and audit, at any time and from time to time, without
prior notice to Borrowers (or either of them), during regular business hours,
the Collateral without hindrance or delay, such Collateral audits to be
performed at the times determined by Lender in its sole discretion;
 
7.1.18            Permit Lender, its officers, employees, designees and agents,
without hindrance or delay, at such times as Lender deems reasonably appropriate
and without prior notice to Borrowers (or either of them) to have reasonable
access during normal business hours to, audit, inspect, and make copies of or
extracts from all of Borrowers’ books and Records including, without limitation,
all journals, orders, receipts and correspondence and any other books and
Records pertaining to Borrowers” business which Lender may request, wherever
located;
 

 
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7.1.19            Cause all persons, including computer service bureaus,
bookkeeping services, accountants, auditors and the like, to make all such books
and Records in their possession available to Lender, its officers, employees,
designees and agents.  If deemed necessary by Lender, in Lender's sole
discretion, upon the occurrence of an Event of Default, Lender may remove them
from any Borrowers’ place of business or any other place where the same may be
found for the purposes of examining, auditing or reproducing the same.  Any
books or Records so removed by Lender shall be returned by Lender as soon as
Lender shall have completed its inspection, audit or reproduction thereof;
 
7.1.20            Take all necessary steps to preserve its corporate,
partnership, limited liability company or other entity existence and franchises
and comply with all present and future Laws applicable to it in the operation of
its business, and all material agreements to which it is subject except those
with respect to which the failure to do so would not have a Material Adverse
Effect on Borrowers (or either of them);
 
7.1.21            Do all acts and make all such filings as may be necessary to
ensure that each Borrower is duly qualified to do business in all jurisdictions
in which the conduct of its business or the ownership of its properties makes
such qualification necessary;
 
7.1.22            If any Account is or becomes Chattel Paper and/or evidenced by
a Promissory Note, trade acceptance or any other Instrument for the payment of
money, promptly deliver such Chattel Paper and/or Instrument to Lender
appropriately endorsed to Lender's order.  Regardless of the form of such
endorsement, each Borrower them) hereby waive presentment, demand, dishonor,
notice of dishonor, protest and notice of protest, and all other notices with
respect thereto;
 
7.1.23            Promptly advise Lender whenever an Account Debtor refuses to
accept delivery of any Goods or services  in an amount of not less than One
Thousand ($1,000.00) Dollars from the sale of which an Account arose and comply
with any instructions that Lender may give regarding the sale or other
disposition of such returns;
 
7.1.24            Immediately notify Lender if any Account arises out of a
contract with the United States or any department, agency, or instrumentality
thereof, and execute any documents or instruments and take any steps required by
Lender so that all monies due and to become due under such Accounts or Contracts
shall be assigned to Lender and notice thereof given to the government under the
Federal Assignment of Claims Act;
 
7.1.25            Promptly notify Lender in writing of any agreement (express or
implied) under which any terms of sale (written or oral) differ from original
terms or normal operating procedures that may have been or will be granted;
 
7.1.26            When requested by Lender from time to time, give Lender
specific assignments and schedules of Accounts after they come into existence,
the form and content of such assignments and schedules to be satisfactory to
Lender;
 
7.1.27            Mark its books and Records concerning Collateral in a manner
reasonably satisfactory to Lender to show Lender's security interest therein;
and at Lender's request, upon the occurrence of an Event of Default, notify all
shippers, agents, landlords, processors or others in possession of Inventory,
and instruct them to hold such Inventory for Lender's account and subject to
Lender's instructions;
 
7.1.28            Instruct  each Borrower’s outside computer service company and
accountants that Lender is irrevocably empowered to have full access to and to
have printouts and all information respecting each Borrower’s financial records
maintained by each Borrower’s outside computer service company and/or
accountants respecting any and all financial Records now or hereafter maintained
by the same on account of each Borrower or the Borrowers at each  Borrower’s
expense and Lender will notify Borrowers (or either of them) of any such
contact;
 
7.1.29            Promptly notify Lender of the occurrence or discovery of any
event which would cause or has caused all or any part of a previously Eligible
Account or Eligible Inventory to become ineligible;
 
7.1.30            Execute and deliver to Lender any instrument, document,
assignment or other writing which Lender deems necessary or desirable to carry
out the terms of this Agreement or to enable Lender to perfect or enforce its
Liens and security interests in the Collateral;
 
7.1.31            Pay Lender on demand the cost of collection or enforcement,
including reasonable attorney's fees, of all Accounts or other Collateral, if
Lender undertakes such collection or enforcement together with all taxes,
charges and expenses of any nature paid or incurred by Lender under or with
respect to Loans hereunder or any of the Collateral therefor, or Lender may
charge any bank account of Borrowers (or either of them) of any nature for such
amounts;
 
7.1.32            Not Used;
 
7.1.33            Enter into a Subordination Agreement with Lender and such
other Person(s), as applicable, who have made loans to Borrowers (or either of
them) to provide that the loan payable to any such Person and any collateral
security therefor will be subordinated to Lender on such terms and conditions
acceptable to Lender;
 
 
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7.1.34            Indemnify and agree to protect, defend and hold harmless
Lender, any entity which "controls" Lender, within the meaning of Section 15 of
the Securities Act of 1933, as amended, or is under common control with Lender
and any member, partner, officer, director, official, agent, employee or
attorney of Lender, and their respective heirs, administrators, executors,
successors and assigns (collectively, the "Indemnified Parties"), from and
against any and all losses, damages, expenses or liabilities of any kind or
nature and from any suits, claims or demands, including reasonable attorneys’
fees incurred in defending such claim, suffered by any of them and caused by,
relating to, arising out of, resulting from, or in any way connected with this
Agreement, the Loan Documents or the transactions contemplated herein and
therein (unless determined by a final judgment of a court of competent
jurisdiction to have been caused by the gross negligence or willful misconduct
of the Indemnified Parties), including, without limitation,
 
(a) losses, damages (including consequential damages payable to third parties),
expenses or liabilities sustained by Lender in connection with any environmental
inspection, monitoring, sampling or cleanup of any real estate or other
Collateral owned or operated by Borrowers (or either of them), required or
mandated by any applicable environmental law;
 
(b) any untrue statement of a material fact contained in information submitted
to Lender by Borrowers (or either of them) or the omission of any material fact
necessary to be stated therein in order to make such statement not misleading or
incomplete;
 
 (c) the failure of Borrowers (or either of them) to perform any undertakings or
obligations herein required to be performed by Borrowers (or either of them) ;
and
 
(d) the ownership, occupancy, operation, use or maintenance of any Property or
Collateral;
 
(e) any breach of any covenant, warranty, representation or other provision of
this Agreement or the Loan Documents;
 
 (f) any sale, lease, encumbrance or other disposition of any of the Collateral,
as that term is defined herein;
 
 (g) any alleged violation of any Law, regulation or ordinance by Borrowers (or
either of them) in connection with this Agreement or any other agreement or
instrument with Borrowers (or either of them);
 
(h) any personal injury or property damage alleged to have been suffered in
connection with the ownership, use, possession, sale, lease or other disposition
of any Collateral; or
 
(i) any claim by any person arising out of each Borrower’s or the Borrowers’
breach of warranty or failure to perform any of each Borrower’s or the
Borrowers’, obligations under any contract regarding the use, sale, lease or
other disposition of any Collateral.  Borrowers further agree to reimburse
Lender for all reasonable counsel fees and costs expended or incurred by Lender
in connection with the foregoing.  This indemnification shall survive, for the
period of the applicable statute of limitations, the termination of this
Agreement.
 
7.1.35            In case any action shall be brought against Lender or any
other Indemnified Party in respect to which indemnity may be sought against the
Borrowers (or either of them), Lender or such other Indemnified Party shall
promptly notify Borrowers (or either of them) and Borrowers (or either of them)
shall assume the defense thereof, including the employment of counsel selected
by Borrowers (or either of them) and satisfactory to Lender, the payment of all
reasonable costs and expenses and the right to negotiate and consent to
settlement.  The failure of Lender to so notify Borrowers (or either of them)
shall not relieve Borrowers (or either of them) of any liability they may have
under the foregoing indemnification provisions from any liability which
Borrowers (or either of them) may otherwise have to Lender, or any of the other
Indemnified Parties, except to the extent materially prejudiced by such delay or
failure of notice.  In the event that Borrowers (or either of them) shall not be
proceeding diligently to defend such claim, Lender shall have the right, at its
sole option, to employ separate counsel in any such action and to participate in
the defense thereof, all at Borrowers’, or either of them, sole cost and
expense.  Borrowers (or either of them) shall not be liable for any settlement
of any such action effected without the applicable Person’s consent (unless
Borrowers (or either of them) fail to defend such claim), but if settled with
Borrowers’, or either of them, consent, or if there be a final judgment for the
claimant in any such action, Borrowers (or either of them) agree to indemnify
and save harmless Lender from and against any loss or liability by reason of
such settlement or judgment;
 
7.1.36            Immediately notify Lender should any circumstances arise that
might lead to imposition of a Lien pursuant to any Environmental Law, as such
statutes may be amended from time to time and take such actions as may be
necessary to prevent such Lien from attaching to any of the Collateral;
 
7.1.37            Obtain all Permits required to be obtained from any
Governmental Authority under any law, rule or regulation, including any
Environmental Law, shall maintain all Permits required to be maintained under
any such laws, rules or regulations, and shall immediately notify Lender of the
Borrower’s or each Borrower’s failure to obtain or maintain any Permit required
to be obtained or maintained under any such laws, rules or regulations;
 
 
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7.1.38            Upon an Event of Default, grant Lender an irrevocable and
exclusive, worldwide, royalty free license to use in any manner and for any
purpose all of the Intellectual Property;
 
7.2        Negative Covenants.  Without the prior written consent of Lender,
each Borrower or the Borrowers shall not:
 
7.2.1         Change its name, its place of business, or, if more than one,
chief executive office or its mailing address, organizational identification
number, if it has one; change its type of organization, jurisdiction of
organization or other legal structure or enter into any merger, consolidation,
reorganization or recapitalization;
 
7.2.2         Create, incur or assume or permit to exist any liability for
borrowed money or lease except for borrowings from Lender, the existing
Indebtedness set forth on Schedule 4 and purchase money loans or leases incurred
to purchase or lease Equipment used in the ordinary course of each Borrower or
the Borrowers’ business provided that;
 
(a) any Liens created to secure such Debt shall be created within 6 months of
the acquisition or lease of the related asset;
 
(b) such Liens do not at any time encumber any property other than the property
financed by such Debt
 
 (c) the amount of Debt secured thereby is not increased; and
 
 (d) the principal amount of Debt secured by any such Lien shall at no time
exceed one hundred percent (100%) of the original purchase price or lease
payment amount of such property at the time it was acquired;
 
7.2.3         Wind up, liquidate or dissolve its affairs, enter into any merger,
consolidation, reorganization or recapitalization, reclassify its capital stock
or make any change to its formation documents;
 
7.2.4         Sell, transfer, assign, lease or otherwise dispose of all or
(except in the ordinary course of business) any material part of its Assets, nor
permit the transfer of any Collateral or Property or any interest of Borrowers
(or either of them) therein;
 
7.2.5         Factor any of its Accounts, nor grant, create, incur or permit to
exist any mortgage, pledge, a security interest in or Lien upon, or for any
other purpose assign or transfer, either absolutely or as collateral security,
any of the Collateral except in favor of Lender;
 
7.2.6         Notify any Account Debtor to make payment except to the Lock Box,
or request an Account Debtor to withhold or stop any payment otherwise directed
by Lender;
 
7.2.7         Become liable, directly or indirectly, as guarantor, surety,
endorser or otherwise for any obligation of any other person, firm, or
corporation except for endorsement of commercial paper for deposit or collection
in the ordinary course of business;
 
7.2.8         Declare or pay any dividends, return any capital to any of its
stockholders, partners, members or other principals, authorize or make any
distribution, payment or delivery of property or cash to its Affiliates, parent
or related entities, stockholders, partners, members or other principals, or
make any other payment or distribution on account of its stock or other
ownership interest in cash or in equity except to the extent necessary to pay
the income taxes payable by the shareholders, partners or members of each
Borrower o  if such Borrower is a Subchapter S Corporation, partnership or
limited liability company;
 
7.2.9         Make any loan or advance to any Affiliate, parent or related
entity, officer, shareholder, member, partner, director or employee of each
Borrower, except for temporary advances in the ordinary course of business;
 
7.2.10       Purchase or otherwise invest in or hold securities, non-operating
real estate or other non-operating Assets, in excess of $20,000 in the aggregate
except:
 
(a) direct obligations of the United States of America;
 
(b) the present investment in any such Assets;
 
(c) operating Assets that hereafter become non-operating Assets; and
 
(d) investment in bank certificates of deposit at banks subject to a Control
Agreement;
 
7.2.11       Issue, redeem, purchase or retire any of its stock, partnership
interests, limited liability company interests, or other ownership interests, or
grant or issue any warrant, right or option pertaining thereto or other security
exercisable or convertible into any of the foregoing.
 
7.2.12       Enter into any new agreement to rent or lease any real or personal
property or enter into any arrangement with any bank, insurance company or other
lender or investor providing for the leasing of any real or personal property or
equipment
 
(a) which has been or is sold or transferred by Borrowers (or either of them) to
such lender or investor or
 
 
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(b) which has been or is being acquired from another Person by such lender or
investor or
 
(c) on which one or more buildings have been or are to be constructed by such
lender or investor, for the purpose of leasing such property to Borrowers (or
either of them);
 
7.2.13       Make or furnish Lender any financial statement, representation,
warranty, certificate or other document, statement or information that will
contain any untrue, incorrect or incomplete statement of material fact or that
will omit to state a material fact necessary to make it not misleading in light
of the circumstances under which it was furnished;
 
7.2.14       Directly or indirectly apply any part of the proceeds of the Loan
to the purchasing or carrying of any "margin stock" within the meaning of
Regulation G, T, X or U of the Board of Governors of the Federal Reserve System,
or any regulations, interpretations or rulings thereunder;
 
7.2.15       Prepay any Subordinated Indebtedness, Indebtedness for borrowed
money, or Indebtedness secured by any of its Assets (except the Obligations) or
enter into or modify any agreement as a result of which the terms of payment of
any of the foregoing Indebtedness are waived or modified, or otherwise satisfy a
Debt, in whole or in part, except as permitted in or under the Loan Documents,
 
7.2.16       Enter into a sale-leaseback or synthetic lease transaction;
 
7.2.17       Acquire a controlling interest of any stock of, membership or
partnership interest in, or all or substantially all of the Assets of, any
Person;
 
7.2.18       Change its fiscal year;
 
7.2.19       Assign or attempt to assign this Agreement or any other Loan
Document or any of its rights, duties or obligations hereunder or thereunder;
or.
 
7.2.20       Store, locate, move or relocate all or any portion of the
Collateral or the Records related thereto in or to any other location except
upon thirty (30) days prior written notice to Lender.
 
8.      DEFAULT.
 
8.1    Events of Default.   The occurrence of any one or more of the following
events shall constitute an “Event of Default” hereunder:
 
8.1.1         Any Obligor shall fail to pay when due, any installment of
principal or interest or fee payable hereunder or any Obligation when it is due;
 
8.1.2         Any Obligor shall fail to observe or perform any other obligation
or covenant required to be observed or performed by it hereunder, under any of
the Loan Documents within five (5) business days of notice of such failure to
observe or perform such obligation or covenant, or under any other agreement
between any Obligor and Lender or the occurrence of an Event of Default under
any other agreement between any Obligor and Lender;
 
8.1.3         Any Obligor shall:
 
(a) fail to pay any Indebtedness due any third Person and such failure is not
cured prior to any acceleration of such Indebtedness by the applicable
creditors, whichever is earlier, or the exercise of any remedies permitted under
any of the documents evidencing such Indebtedness, unless indebtedness is the
subject of a bona fide dispute; or
 
(b) any Obligor shall suffer to exist any  event of default under any agreement
binding upon any Obligor, provided that the failure of any Individual Surety to
pay any non-material consumer debt shall not constitute an Event of Default
hereunder, provided further that Obligor shall be entitled to fail to pay
Indebtedness which is the subject of a bona fide dispute between such Obligor
and the creditor thereof which is being prosecuted diligently by such Obligor;
 
8.1.4         Any Obligor shall make or furnish to Lender any representation,
warranty, statement or certificate in connection with this Agreement, the Loan
Documents or the Obligations which is not true and correct in all material
respects when made or furnished, or shall be false, incorrect or incomplete when
made or shall have breached any Affirmative or Negative Covenant hereunder;
 
8.1.5         Any Obligor shall admit its inability to pay its debts as they
mature, or shall make an assignment for the benefit of its creditors;
 
8.1.6         Proceedings in bankruptcy, or for reorganization of any Obligor,
or for the readjustment of any of its debts under Bankruptcy Code, as amended,
or any part thereof, or under any other laws, whether state or federal, for the
relief of debtors, now or hereafter existing, shall be commenced by or against
any Obligor and, if commenced against any Obligor, shall not be discharged
within thirty (30) days of their commencement;
 
 
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8.1.7         A receiver or trustee shall be appointed for any Obligor or for
any substantial part of its Assets, or any proceedings shall be instituted for
the dissolution or the full or partial liquidation of any Obligor, and such
receiver or trustee shall not be discharged within thirty (30) days of its
appointment, or any Obligor shall discontinue business or materially change the
nature of its business;
 
8.1.8         The entry of any judgment against any Obligor which, if adversely
decided, would have a Material Adverse Effect, which remains unsatisfied for
thirty (30) days unless being contested by Obligor in good faith with
appropriate proceedings and with execution stayed; or a judgment creditor of any
Obligor shall obtain possession of any of the Collateral by any means,
including, but without limitation, levy, distraint, replevin or self-help;
 
8.1.9         Any Governmental Authority or instrumentality seizes,
appropriates, condemns or occupies all or a substantial part of the Properties
of any Obligor or interferes in any substantial manner with the operation of the
business of any Obligor;
 
8.1.10       Any Plan is terminated within the meaning of Title IV of ERISA, or
a trustee is appointed by the appropriate United States District Court to
administer any Plan, or the Pension Benefit Guaranty Corporation, or any
successor thereto, institutes proceedings to terminate any Plan or to appoint a
trustee to administer any Plan, or any Reportable Event or COBRA Violation
occurs which Lender determines in good faith indicates a substantial likelihood
that an event described above will occur;
 
8.1.11       If, in Lender’s judgment, the value of the Collateral so
substantially deteriorates or diminishes that Lender reasonably deems the
Obligations to be inadequately secured, and Obligor neither reduces the amount
of the Obligations, nor provides additional Collateral;
 
8.1.12       Any obligee of Subordinated Indebtedness fails to comply with the
subordination provisions of the instrument evidencing Subordinated Indebtedness
or any Subordination Agreement referred to in this Agreement;
 
8.1.13       The validity or enforceability of this Agreement, the Revolving
Loan Note or any of the Loan Documents, shall be contested by any Obligor or any
Obligor shall deny that it has any or further liability or obligation hereunder
or therewith;
 
8.1.14       The occurrence of any Material Adverse Change in the financial
condition of any Obligor;
 
8.1.15       A Change in Control of Borrowers (or either of them).
 
8.2    Acceleration.  Immediately and without notice upon the occurrence and
during the continuation of any Event of Default, all Obligations, whether
hereunder or otherwise, shall immediately become due and payable without further
action of any kind; and, notwithstanding any outstanding commitment of Lender to
Borrowers (or either of them) to make additional and further Loans to Borrowers
(or either of them), upon the occurrence of any Event of Default, any such
commitment shall immediately become null and void and of no force and effect
whatsoever.
 
8.3    Remedies.
 
8.3.1         After any acceleration due to an Event of Default, interest on the
principal balance of the Obligations outstanding from time to time shall accrue
and is payable at the interest rate set forth in Schedule 2 attached hereto plus
five percent 5%) per annum from the date of such acceleration until all such
Obligations are satisfied in full and whether or not any judgment is entered
hereon (the sum of both rates, the "Default Rate").  In addition to the rights
and remedies given it by this Agreement and the Loan Documents, Lender shall
have all those allowed by all applicable laws, including, but without
limitation, the Uniform Commercial Code as enacted in any jurisdiction in which
any Collateral may be located and Lender may enforce such rights and pursue such
remedies without demand of performance and without other notice.  Without
limiting the generality of the foregoing, Lender may immediately, without demand
of performance and without other notice (except as specifically required by this
Agreement or the Loan Documents) or demand whatsoever to any Obligor, all of
which are hereby expressly waived, and without advertisement, take possession of
the Collateral, exercise the Warrant of Attorney contained in Section 9.17
herein, retain all of each Borrower’s Records, sell at public or private sale or
otherwise realize upon in Pennsylvania, or elsewhere, the whole or, from time to
time, any part of the Collateral or any interest which any Obligor may have
therein.  After deducting from the Proceeds of sale or other disposition of the
Collateral all expenses (including all expenses for legal services), Lender
shall apply such Proceeds toward the satisfaction of the Obligations.  Any
remainder of the Proceeds after satisfaction in full of the Obligations shall be
distributed as required by applicable Laws.  Notice of any sale or other
disposition shall be given to Borrowers (or either of them) at least ten (10)
days before the time of any intended public sale or of the time after which any
intended private sale or other disposition of the Collateral is to be made,
which Borrowers hereby agree shall be reasonable notice of such sale or other
disposition.  Borrowers (or either of them) agree to assemble, or to cause to be
assembled at its expense, the Collateral at such place or places, as Lender
shall designate.  At any such sale or other disposition, Lender may, to the
extent permissible under applicable laws, purchase the whole or any part of the
Collateral, free from any right of redemption on the part of any Obligor, which
right is hereby waived and released.  Without limiting the generality of any of
the rights and remedies conferred upon Lender under this paragraph, Lender may,
to the full extent permitted by applicable Laws:
 
 
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(a) enter upon the premises of Borrowers, exclude therefrom Borrowers or any
Affiliate thereof, and take immediate possession of the Collateral, either
personally or by means of a receiver appointed by a court of competent
jurisdiction, using all necessary force to do so;
 
 (b) at Lender's option, use, operate, manage and control the Collateral in any
lawful manner;
 
 (c) collect and receive all rents, income, revenue, earnings, issues and
profits therefrom; and
 
 (d) maintain, repair, renovate, alter or remove the Collateral as Lender may
determine in its discretion.
 
8.3.2         To the extent that applicable law imposes duties on Lender to
exercise remedies in a commercially reasonable manner, each Borrower
acknowledges and agrees that it is not commercially unreasonable for Lender
 
(a) to fail to incur expenses reasonably deemed significant by Lender to prepare
Collateral for disposition or otherwise to complete raw material or work in
process into finished goods or other finished products for disposition,
 
(b) to fail to obtain third party consents for access to Collateral to be
disposed of, or to obtain or, if not required by other law, to fail to obtain
governmental or third party consents for the collection or disposition of
Collateral to be collected or disposed of,
 
 (c) to fail to exercise collection remedies against Account Debtors or other
Persons obligated on Collateral or to remove Liens on or any adverse claims
against Collateral,
 
(d) to exercise collection remedies against Account Debtors and other persons
obligated on Collateral directly or through the use of collection agencies and
other collection specialists,
 
 (e) to advertise dispositions of Collateral through publications or media of
general circulation, whether or not the Collateral is of a specialized nature,
 
 (f) to contact other Persons, whether or not in the same business as each
Borrower for expressions of interest in acquiring all or any portion of the
Collateral,
 
(g) to hire one or more professional auctioneers to assist in the disposition of
Collateral, whether or not the Collateral is of a specialized nature,
 
 (h) to dispose of Collateral by private sale or by utilizing Internet sites
that provide for the auction of assets of the types included in the Collateral
or that  have the reasonable capability of doing so, or that match buyers and
sellers of assets,
 
 (i) to dispose of assets in wholesale rather than retail markets,
 
 (j) to disclaim disposition warranties,
 
 (k) to purchase insurance or credit enhancements to insure Lender against risks
of loss, collection or disposition of Collateral or to provide to Lender a
guaranteed return from the collection or disposition of Collateral, or
 
 (l) to the extent deemed appropriate by Lender, to obtain the services of other
brokers, investment bankers, consultants and other professionals to assist
Lender in the collection or disposition of any of the Collateral.
 
Each Borrower acknowledges that the purpose of this Paragraph 8.3.2 is to
provide non-exhaustive indications of what actions or omissions by Lender would
not be commercially unreasonable in Lender's exercise of remedies against the
Collateral and that other actions or omissions by Lender shall not be deemed
commercially unreasonable solely on account of not being indicated in this
Paragraph 8.3.2. Without limitation upon the foregoing, nothing contained in
this Paragraph 8.3.2 shall be construed to grant any rights to the Borrowers (or
either of them) or to impose any duties on Lender that would not have been
granted or imposed by this Agreement or by applicable law in the absence of this
Paragraph 8.3.2.
 
 
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9.      MISCELLANEOUS.
 
9.1        Construction.  The provisions of this Agreement shall be in addition
to those of any guaranty, surety, hypothecation, pledge or security agreement,
note, or other evidence of liability held by Lender, and any other agreement
between Borrowers (or either of them) and any entity constituent of Borrowers
(or either of them) as guarantor or otherwise, and Lender, all of which shall be
construed as complementary to each other.  Nothing herein contained shall
prevent Lender from enforcing any or all other notes, guaranty, surety,
hypothecation, pledge or security agreements in accordance with their respective
terms.  The parties acknowledge that any and all Accounts assigned or
transferred to Lender or in which Lender is granted a security interest
hereunder have been assigned, and transferred to Lender, and Lender was granted
a security interest therein, as security for Lender's Loan and advances
hereunder, and each Borrower and the Borrowers’ Obligations, and are not and
have not been, in fact, sold to Lender regardless of whether any assignment
thereof, which is or may be separate from this Agreement, is absolute.
 
9.2        Term of Agreement.  This Agreement shall terminate after payment in
full of the Revolving Loan Note and the discharge of all obligations and
undertakings of each Borrower and the Borrowers to Lender, whether arising
hereunder or otherwise.  Lender’s agreement hereunder to make the Loans shall
terminate on the earliest of:
 
(a) the occurrence of an Event of Default;
 
(b) the Revolving Credit Termination Date; or
 
 (c) on the date specified in the notice given by Lender pursuant to this
Agreement (including pursuant to the provisions of Section 2.1.1 hereof);
provided that certain agreements of Borrowers (or either of them)  hereunder
shall continue in full force and effect beyond the Revolving Credit Termination
Date or other termination hereof.  In addition, the renewal of the Revolving
Credit shall be subject to annual review by Lender in its sole discretion.
 
9.2.1           On the Revolving Credit Termination Date, all of the Obligations
shall be immediately due and payable.  The termination of this Agreement shall
not affect the rights, liabilities and obligations of the parties with respect
to the Obligations as of the date of termination, or the Collateral which
secures and is to secure the Obligations, which Collateral shall remain subject
to the liens and security interests granted hereunder until all of the
Obligations are satisfied in full.  The failure of Lender to enforce any of the
terms and provisions hereof or failure to declare default hereunder shall apply
only in a particular instance, and shall not operate as a continuing waiver.
 
9.3        Accounting Terms.  All accounting terms not specifically defined
herein shall be construed in accordance with GAAP, except as otherwise stated
herein.
 
9.4        Stamp or Excise Tax.  Should any stamp or excise tax be payable in
respect of this Agreement, the Revolving Loan Note and other documents to be
delivered hereunder, or any modification hereof or thereof, Borrowers (or either
of them) shall pay the same and shall hold Lender harmless from any and all
liabilities with respect to or resulting from any delay in paying or any failure
to pay such taxes.
 
9.5        Further Assurance.  From time to time, Borrowers (or either of them)
will execute and deliver to Lender such additional documents and will provide
such additional information as Lender may reasonably require to carry out the
terms of this Agreement and be informed of Borrowers (or either of them)’s
status and affairs.
 
9.6        Enforcement and Waiver by Lender.  Lender shall have the right at all
times to enforce the provisions of this Agreement and the Loan Documents in
strict accordance with the terms hereof and thereof, notwithstanding any conduct
or custom on the part of Lender in refraining from so doing at any time or
times.  The failure of Lender at any time or times to enforce its rights under
such provisions strictly in accordance with the same shall not be construed as
having created a custom in any way or manner contrary to specific provisions of
this Agreement or as having in any way or manner modified or waived the
same.  All rights and remedies of Lender are cumulative and the occurrence and
the exercise of one right or remedy shall not be deemed a waiver or release of
any other right or remedy.
 
9.7        Expenses of Lender.  Borrowers (or either of them) will pay all
expenses including the fees and expenses of legal counsel for Lender, incurred
in connection with the administration, amendment, modification or enforcement of
this Agreement and the Loan Documents and the collection or attempted collection
of the Obligations, the Revolving Loan Note and the Collateral.
 
9.8        Notice.  Any notices or consents required or permitted by this
Agreement shall be in writing and shall be delivered in person or sent by first
class or certified mail, return receipt requested, postage prepaid, by reputable
overnight carrier, or by fax, as follows, unless such address is changed by
written notice hereunder:
 

 
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If to Borrowers:
 
WLG (USA) LLC and World Commerce Services, L.L.C.
 
920 East Algonquin Road, Suite 120
 
Schaumburg, IL 60173
 
Attention: Edmund C. Pawelko, Chief Executive Officer
 
Facsimile: 630-477-0483
 
If to Lender:
 
NOVA Business Credit, a division of NOVA Bank
 
1235 Westlakes Drive, Suite 420
 
Berwyn, PA 19312
 
Attn: Randi M. Hershgordon, Vice President
 
Facsimile:  610-993-4162
 
9.8.1           Notices shall be deemed to have been received if hand delivered,
when delivered, if sent by certified mail or first class mail, three (3)
calendar days after the date deposited in the United States Mail, if by
overnight courier, on the date scheduled for delivery, and if by fax, when
transmitted.  Any party may change the name and address of the person to whom
notices hereunder are to be sent by giving notice to such other party as
specified hereunder.
 
9.9         Waiver and Release by Borrowers .  To the maximum extent permitted
by applicable Laws, each Borrower and the Borrowers  waive protest of all
commercial paper at any time held by Lender on which each Borrower or the
Borrowers is in any way liable and notice after acceleration in the manner
herein provided before exercise by Lender of the remedies of self-help, set-off,
or of other summary procedures permitted by any applicable laws, or by any
agreement with each Borrower or the Borrowers, and, except where required hereby
or by any applicable laws, notice of any other action taken by Lender; and
release Lender and its officers, attorneys, agents and employees from any and
all claims for loss or damages caused by any act or omission on the part of any
of them except willful misconduct.
 
9.10       Applicable Law.  The internal laws of the Commonwealth of
Pennsylvania shall govern the construction of this Agreement, the Loan Documents
and the rights and remedies of the parties hereto, without regard to its
conflict of laws principles.
 
9.11       Consent to Jurisdiction, Service and Venue.  For the purpose of any
suit, action or proceeding arising out of or relating to this Agreement, the
Revolving Loan Note or the Loan Documents, each Borrower hereby irrevocably
consent and submit to the jurisdiction and venue of any of the Courts of the
Commonwealth of Pennsylvania or any Federal court located in the Eastern
District of Pennsylvania including, without limitation, the Court of Common
Pleas of Montgomery County and the United States District Court for the Eastern
District of Pennsylvania, regardless of the convenience of such forum, and each
Borrower  further agree and consent to accept and acknowledge all service of
process carried out by means of registered mail, return receipt requested in
connection with any such matter.  The provisions of this Section shall not limit
or otherwise affect the right of Lender to institute and conduct action in any
other appropriate manner, jurisdiction or court. Each Borrower and the Borrowers
hereby acknowledge and agree that this Agreement has been negotiated, executed
and delivered by the parties hereto, and the transactions described herein have
been consummated, exclusively within the Commonwealth of Pennsylvania.
 
9.12       Binding Effect, Assignment and Entire Agreement.  This Agreement
shall inure to the benefit of and shall be binding upon the respective
successors and permitted assigns of the parties hereto.  Borrowers (or either of
them) do not have any right to assign any of their rights or obligations
hereunder without the prior written consent of Lender; provided, however, that
Lender shall be permitted to assign all of its rights, privileges and
obligations hereunder at any time.  This Agreement and the Loan Documents
executed and delivered pursuant hereto, constitute the entire agreement between
the parties and may be amended only by a writing signed on behalf of each party.
 
9.13       Severability.  If any provision of this Agreement shall be held
invalid under any applicable Laws, such invalidity shall not affect any other
provision of this Agreement that can be given effect without the invalid
provision, and to this end, the provisions hereof are severable.
 
9.14       Counterparts.  This Agreement may be executed in any number of
counterparts, each of which shall be deemed to be an original, but all of which
together shall constitute but one and the same instrument.
 

 
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9.15       Seal.  This Agreement is intended to take effect as an instrument
under seal.
 
9.16       Time of the Essence.  Time is of the essence in this Agreement.
 
9.17       WARRANT OF ATTORNEY.
 
THE FOLLOWING PARAGRAPH SETS FORTH A WARRANT OF AUTHORITY FOR ANY ATTORNEY TO
CONFESS JUDGMENT AGAINST BORROWERS (OR EITHER OF THEM).  IN GRANTING THIS
WARRANT OF ATTORNEY TO CONFESS JUDGMENT AGAINST BORROWERS (OR EITHER OF THEM)
EACH BORROWER FOLLOWING CONSULTATION WITH SEPARATE COUNSEL FOR EACH BORROWER AND
WITH KNOWLEDGE OF THE LEGAL EFFECT HEREOF, HEREBY KNOWINGLY, INTENTIONALLY,
VOLUNTARILY AND UNCONDITIONALLY WAIVE ANY AND ALL RIGHTS BORROWERS (OR EITHER OF
THEM HAVE OR MAY HAVE TO PRIOR NOTICE AND AN OPPORTUNITY FOR HEARING UNDER THE
RESPECTIVE CONSTITUTIONS AND LAWS OF THE UNITED STATES OF AMERICA, THE
COMMONWEALTH OF PENNSYLVANIA, OR ELSEWHERE.  IT IS SPECIFICALLY ACKNOWLEDGED BY
THE UNDERSIGNED THAT LENDER HAS RELIED ON THIS WARRANT OF ATTORNEY IN ENTERING
INTO THIS AGREEMENT AND AS AN INDUCEMENT TO GRANT FINANCIAL ACCOMMODATIONS TO
BORROWERS (OR EITHER OF THEM) .
 
EACH BORROWER AND THE BORROWERS HEREBY IRREVOCABLY AUTHORIZE AND EMPOWER ANY
ATTORNEY OR ANY CLERK OF ANY COURT OF RECORD, TO APPEAR FOR AND CONFESS JUDGMENT
AGAINST BORROWERS (OR EITHER OF THEM: (A) FOR SUCH SUMS AS ARE DUE AND/OR MAY
BECOME DUE ON THE OBLIGATIONS EVIDENCED BY THIS AGREEMENT, AND/OR (B) IN ANY
ACTION OF REPLEVIN INSTITUTED BY LENDER TO OBTAIN POSSESSION OF ANY COLLATERAL
SECURING THE NOTE OR SECURING ANY OF THE OBLIGATIONS, IN EITHER CASE WITH OR
WITHOUT DECLARATION, WITH COSTS OF SUIT, WITHOUT STAY OF EXECUTION AND WITH AN
AMOUNT, FOR LIEN PRIORITY PURPOSES, EQUAL TO THE AMOUNT OF SUCH JUDGMENT, PLUS
ATTORNEYS’ COLLECTION FEES.  TO THE EXTENT PERMITTED BY LAW, OBLIGORS: (1) WAIVE
THE RIGHT OF INQUISITION ON ANY REAL ESTATE LEVIED ON, VOLUNTARILY CONDEMN THE
SAME, AUTHORIZE THE PROTHONOTARY OR CLERK TO ENTER UPON THE WRIT OF EXECUTION;
(2) WAIVE AND RELEASE ALL RELIEF FROM ALL REDEMPTION, APPRAISEMENT, STAY,
EXEMPTION, OR APPEAL LAWS OF ANY STATE NOW IN FORCE OR HEREAFTER ENACTED; AND
(3) RELEASE ALL ERRORS IN SUCH PROCEEDINGS.  IF A COPY OF THIS AGREEMENT,
VERIFIED BY AFFIDAVIT BY OR ON BEHALF OF LENDER SHALL HAVE BEEN FILED IN SUCH
ACTION, IT SHALL NOT BE NECESSARY TO FILE THE ORIGINAL OF THIS AGREEMENT AS A
WARRANT OF ATTORNEY.  THE AUTHORITY AND POWER TO APPEAR FOR AND ENTER JUDGMENT
AGAINST BORROWERS (OR EITHER OF THEM) SHALL NOT BE EXHAUSTED BY THE INITIAL
EXERCISE THEREOF, AND THE SAME MAY BE EXERCISED, FROM TIME TO TIME, AS OFTEN AS
LENDER MAY DEEM NECESSARY AND DESIRABLE, AND THIS AGREEMENT SHALL BE A
SUFFICIENT WARRANT THEREFOR.  LENDER MAY ENTER ONE OR MORE JUDGMENTS IN THE SAME
OR DIFFERENT JURISDICTIONS FOR ALL OR PART OF BORROWERS’ OBLIGATIONS, WITHOUT
REGARD TO WHETHER JUDGMENT HAS THERETOFORE BEEN ENTERED ON MORE THAN ONE
OCCASION FOR THE SAME OBLIGATIONS.  IN THE EVENT ANY JUDGMENT ENTERED AGAINST
BORROWERS (OR EITHER OF THEM) HEREUNDER IS STRICKEN OR OPENED UPON APPLICATION
BY OR ON BORROWERS’ BEHALF FOR ANY REASON WHATSOEVER, LENDER IS HEREBY
AUTHORIZED AND EMPOWERED TO AGAIN APPEAR FOR AND CONFESS JUDGMENT AGAINST
BORROWERS (OR EITHER OF THEM)  FOR ANY PART OR ALL OF THE OBLIGATIONS;
INCLUDING, WITHOUT LIMITATION, A SUBSEQUENT ENTRY OR ENTRIES OF JUDGMENT BY
LENDER TO CURE ANY ERROR OR DEFECTS IN SUCH PRIOR PROCEEDINGS.
 
9.18       Usury. If the applicable interest rate from time to time shall exceed
the maximum rate of interest permitted by applicable law, then the applicable
interest rate during such time shall be reduced so as to equal the maximum rate
of interest permitted by applicable law, and, in the event a payment is made by
Borrowers or received by Lender in excess of the applicable legal limits, the
amount of such excess payment shall be credited to the account of Borrowers as a
payment of principal.
 
9.19       Gender, Etc.  Whenever used herein, the singular shall include the
plural, the plural shall include the singular, and the use of the masculine,
feminine or neuter gender shall include all genders, as the context may require.
 
9.20       Headings.  The Section and subsection headings of this Agreement are
for convenience of reference only, and shall not limit or otherwise affect any
of the terms hereof.
 
9.21       Signatures by Facsimile.  Any facsimile signature of any party hereto
shall constitute a legal, valid and binding execution hereby by such party.
 
 
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9.22       WAIVER OF JURY TRIAL.  EACH BORROWER ACKNOWLEDGES AND AGREES THAT:
(a) ANY SUIT, ACTION OR PROCEEDING, WHETHER CLAIM OR COUNTERCLAIM, BROUGHT OR
INSTITUTED BY THE LENDER, BORROWERS (OR EITHER OF THEM) OR ANY OTHER PARTY
HERETO OR ANY SUCCESSOR OR ASSIGN OF LENDER, BORROWERS (OR EITHER OFTHEM)  OR
ANY OTHER PARTY HERETO, ON OR WITH RESPECT TO THIS AGREEMENT OR ANY OF THE LOAN
DOCUMENTS OR THE OTHER DOCUMENTS REQUIRED HEREUNDER OR THE DEALINGS OF THE
PARTIES WITH RESPECT HERETO, OR THERETO, SHALL BE TRIED ONLY BY A COURT AND NOT
BY A JURY AND EACH BORROWER AND THE BORROWERS WAIVE THE RIGHT TO TRIAL BY JURY;
(b) EACH BORROWER AND THE BORROWERS WAIVE ANY RIGHT IT MAY HAVE TO CLAIM OR
RECOVER, IN ANY SUCH SUIT, ACTION OR PROCEEDING, ANY SPECIAL, EXEMPLARY,
PUNITIVE OR CONSEQUENTIAL DAMAGES OR ANY DAMAGES OTHER THAN, OR IN ADDITION TO,
ACTUAL DAMAGES; AND (c) THIS SECTION IS A SPECIFIC AND MATERIAL ASPECT OF THIS
AGREEMENT AND THE LENDER WOULD NOT EXTEND CREDIT TO THE BORROWERS (OR EITHER OF
THEM) IF THE WAIVERS SET FORTH IN THIS SECTION WERE NOT A PART OF THIS
AGREEMENT.
 

-SIGNATURE PAGE FOLLOWS-

 
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered by their proper and duly authorized officers as of the
day and year first above written.
 
ATTEST:
 
WLG (USA) LLC (a “Borrower”)
     
By:
/s/ Mary D. McALeer
 
By:
/s/ Edmund C. Pawelko
(SEAL)
     
Name:
Edmund C. Pawelko
       
Its:
Chief Executive Officer
 

ATTEST:
 
World Commerce Services, L.L.C. (a “Borrower”)
     
By:
/s/ Mary D. McALeer
 
By:
/s/ Edmund C. Pawelko
(SEAL)
     
Name:
Edmund C. Pawelko
       
Its:
Chief Executive Officer
 

 
NOVA Business Credit, a division of NOVA Bank (“Lender”)
         
By:
/s/ Randi M. Hershgordon
   
Name: Randi M. Hershgordon
   
Its: Vice President

 
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Schedule 1
 
1)      "Accounts", "Chattel Paper", "Contracts", "Contract Rights",
"Documents", "Equipment", "Fixtures" "General Intangibles", "Goods",
"Inventory", "Investment Property", "Instruments", "Letter-of-Credit Rights",
"Deposit Accounts", "Payment Intangibles", "Health Care Insurance Receivables",
"Records", "Promissory Notes", "Supporting Obligations" and "Proceeds" shall
have the same respective meanings as are given to those terms in the Uniform
Commercial Code except that the term "Accounts" shall also include all amounts
due under any lease of real property, a note receivable, any right to payment
under a note receivable, any right to payment which has been earned under an
Account, a Contract Right, HealthCare Insurance Receivable, or credit card
receivable, Letter-of-Credit Right, Payment Intangibles and all rights to
payment arising out of or related to any and all personal property lease
agreements, personal property rental agreements and consignment agreements in
which any the Borrowers (or either of them) are the lessor, renter or consignor,
and this Agreement shall also be considered an assignment of all such lease,
rental and consignment agreements and "Inventory" shall include the property
described in this Schedule 1,Paragraph 30).
 
2)      "Account Debtor" shall mean the Person with respect to any Account,
and/or the prospective purchaser with respect to any Contract Right, and/or any
party who enters into or proposes to enter into any contract or other
arrangement with the Borrowers (or either of them) pursuant to which the
Borrowers (or either of them) are to deliver any personal property or perform
any service.
 
3)      "Affiliate" shall mean any Person which, directly or indirectly,
controls, is controlled by or is under common control with the Borrowers (or
either of them), or any stockholder, partner, owner or member of the Borrowers
(or either of them) or any Person which controls any stockholder, partner, owner
or member of the Borrowers (or either of them).  For the purpose of this
definition, "control" means the possession, directly or indirectly, of the power
to direct or to cause the direction of management and policies or having the
ordinary voting power to elect the Board of Directors or other governing body,
whether through the ownership of voting securities, by contract, by agreement or
otherwise.
 
 
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4)      "Assets" means all assets that should, in accordance with GAAP,
consistently applied, be classified as assets on a balance sheet of the
Borrowers (or either of them).
 
5)      “Authorized Financial Officer” means any corporate officer, proprietor,
partner or any individual designated in writing by the Borrowers (or either of
them) as such.
 
6)      "Base Rate” means the base commercial lending rate of Wilmington Trust
FSB as publicly announced to be in effect from time to time, such Base Rate to
be adjusted automatically, without notice, on the effective date of any change
in Wilmington Trust's base commercial lending rate.  If such rate ceases to be
available or is otherwise not published, Lender may use a similar published
prime or base rate as chosen by Lender.  The Base Rate is not necessarily the
lowest or best rate of interest offered by Lender to any Borrower or class of
Borrowers.
 
7)      “Borrowing Base” means an amount equal to the lesser of:
 
a)            the Revolving Credit Limit or
 
b)           the aggregate of the percentage advances and other limitations and
sub-limits set forth in Schedule 2 attached hereto and made part hereof,
which Schedule 2 may be amended from time to time by the Lender at its sole
discretion.
 
8)      “Borrowing Base Certificate” means a certificate, satisfactory to
Lender, certified to be true and correct by an Authorized Financial Officer of
the Borrowers that mathematically computes the Borrowing Base.
 
9)      "Business Day" shall mean any day other than a Saturday, Sunday or other
day on which banking institutions in the Commonwealth of Pennsylvania are either
authorized or required to be and remain closed to the general public.
 
10)    "Change in Control" shall mean the termination of the employment of
Edmund C. Pawelko, Chief Executive Officer of each  Borrower or David L. Koontz,
Chief Financial Officer of WLG, Inc., or any change in the manager/ sole
member’s  (WLG INC.) interest in the Borrowers, or either of them. For purposes
hereof, "Control" shall mean the possession, directly or indirectly, of the
power to direct or cause the direction of the Borrowers’ management or policies,
whether through the ownership of securities, by contract or otherwise.
 
11)    "Closing" means the receipt or waiver by Lender of all the agreements,
documents and instruments required hereunder in form and content acceptable to
Lender, and the satisfaction by the Borrowers or waiver or extension by Lender
of all or part of the Conditions Precedent set forth in Section 5
hereof.  "Closing Date", means the date upon which Lender has elected to make
the initial disbursement of the Loan(s) to the Borrowers.  The Closing Date
shall be February 24, 2010 unless otherwise extended by Lender.
 
12)    "COBRA Violations" shall mean a failure by the Borrowers (or either of
them) to comply with group health plan continuation coverage requirements of
Section 601 et seq. of ERISA.
 
13)    "Collateral Documents" means all other agreements, documents or
instruments pursuant to which Lender obtains any Lien or other security interest
in the Collateral or any other property of the Borrowers (or either of them).
 
14)    "Control Agreement" shall mean the agreement between each Borrower,
Lender and each Borrower’s bank evidencing Lender's security interest in and
control of the Borrowers’ bank account(s).
 
15)    "Debt" shall mean all of the Borrowers’ Liabilities (determined in
accordance with GAAP).
 
16)    "Dollars" and "$" means dollars in the lawful currency of the United
States.
 
17)    "Eligible Account" means an Account that Lender in its reasonable credit
judgment determines shall be an "Eligible Account" and conforms and continues to
conform to the following conditions which Lender may, in its sole discretion,
establish, determine or adjust from time to time:
 
a)      The Account and all papers and documents relating thereto are authentic,
valid and subsisting and arose from a bona fide outright sale of Goods,
merchandise or other property by the Borrowers (or either of them) , or for
services performed by the Borrowers (or either of them) in the ordinary course
of the Borrowers’ business, based upon an enforceable order or contract, written
or oral, for Goods shipped or services performed, and such Goods, merchandise or
other property have been shipped to the appropriate Account Debtor (or the sale
has otherwise been consummated), and the services have been performed for the
appropriate Account Debtor in full compliance with the specifications of the
Account Debtor, and an invoice has been issued for the full amount due from the
Account Debtor;
 
 
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b)      Each Borrower’s or Borrowers’ title to the Account and, except as to the
rights of the Account Debtor, to any Goods, is absolute and is not subject to
any prior assignment, claim, lien or security interest;
 
c)      The amount shown on the books of the Borrowers (or either of them) and
on any invoice or statement delivered to Lender is owing to Borrowers, and no
partial payment has been made thereon by anyone;
 
d)      The Account is not;
 
(i) a contra account,
 
(ii) C.O.D. or sight draft account,
 
(iii) a commission account
 
(iv) an Intercompany Account, (v) in default, or
 
(vi) subject to any claim or reduction, counterclaim, set off, recoupment or any
claim for credits, allowances or adjustments by the Account Debtor because of
returned, inferior or damaged Goods or unsatisfactory services, or for any other
reason, except for customary discounts allowed for prompt payment;
 
e)      Under terms satisfactory to the Lender, the Account is not due from an
Account Debtor located outside of the continental United States, unless credit
insured with Lender named as loss payee.
 
f)      The Account is readily collectible and is not an invalid, disputed or
unenforceable Account, and is not an Account that Lender, in its sole
discretion, has determined to be ineligible, in whole or in part, and has
notified the Borrowers(or either of them) thereof;
 
g)      The Account Debtor has not returned or refused to retain any Goods from
the sale of which the Account arose;
 
h)      The Account is evidenced by an invoice that has a definite due date, is
not pre-billed and is due and payable not more than thirty (30) days from the
invoice date and is not more than sixty (60) days past due on such thirty (30)
day terms, and in any event is not outstanding more than ninety (90) days from
the invoice date;
 
i)      No Account arises out of a contract with or from, an Account Debtor
that, by its terms, forbids or makes void or unenforceable the assignment by
each Borrower to Lender of the Account arising with respect thereto;
 
j)      Borrowers (or either of them) have not received any note, trade
acceptance, draft or other Instrument with respect to or in payment for the
Account, nor any Chattel Paper with respect to the Goods giving rise to the
Account and, if any such Instrument or Chattel Paper is received, Borrowers will
immediately notify Lender and, at the latter's request, endorse or assign and
deliver the same to Lender (if Borrowers receive any such Instrument or Chattel
Paper, Borrowers shall not replace the Account with such Instrument or Chattel
Paper without prior notice to Lender and delivery of such original Instrument or
Chattel Paper to Lender);
 
k)      Borrowers (or either of them) have no knowledge of and have not received
any notice of the death of any Account Debtor or a partner thereof if the
Account Debtor is an individual or a partnership, nor of the dissolution,
termination of existence, insolvency, business failure, appointment of a
receiver for any part of the property of, assignment for the benefit of
creditors by, or the filing of a petition in bankruptcy or the commencement of
any proceeding under any bankruptcy or insolvency laws by or against the Account
Debtor (if Borrowers have or obtain any such knowledge or upon the receipt by
Borrowers of any such notice (whether oral or written), it will immediately give
Lender written advice thereof);
 
l)      The Account Debtor is not a parent, Subsidiary, or an Affiliate of
Borrowers (or either of them), nor an officer, director, employee or partner of
Borrowers or of a parent, Subsidiary or Affiliate of Borrowers nor owned or
controlled by any of the foregoing;
 
m)     The Account is not due from any federal governmental authority unless
such Account, if necessary to perfect Lender’s interest therein or Lender’s
right of direct payment thereunder, has been properly assigned directly to
Lender (and acknowledged as assigned by the Account Debtor thereon) in form
satisfactory to Lender;
 
n)      The Account is not contingent upon the fulfillment of any condition or
contingent upon the payment of any monies due from a third party;
 
o)      The Account is supported by valid Shipping Documents;
 
p)      The Account is not the result of guaranteed sales nor does it arise from
a consignment arrangement or similar transaction;
 
q)      The Account is not a "bill and hold" transaction, nor did it arise as a
result of a billing for Goods which have not been shipped nor a "pre-billed"
transaction, however denominated;
 
 
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r)      The Account is not a progress billing (if any Account results from a
progress billing, Borrowers(or either of them) shall furnish Lender with copies
of all Contracts related to such Account upon Lender's request, but in any
event, prior to the start of the initial fabrication of the product or shipment
or provision of services);
 
s)      The Account is not a retainer (including, but not limited to
construction retainages), nor does it represent interest or finance charges;
 
t)      Less than 50% of the Account is ineligible for any reason;
 
u)     The Account represents not more than the percentage of the total accounts
receivable as described in Schedule 2 (“Account Concentration”);
 
v)     The Account is an Account on which Lender has a first and exclusive lien
and security interest;
 
w)    The Account meets such other specifications and requirements as Lender may
in its sole discretion establish or determine from time to time. Lender shall
have the right, at any time and from time to time after the Closing Date, to
adjust any such criteria and to establish new criteria, all in its reasonable
credit judgment; and
 
x)      Any Account that was originally an Eligible Account shall cease to be an
Eligible Account in the event
 
 i) it shall not continue to conform to the conditions and warranties set forth
in this Agreement or
 
ii) Lender shall notify Borrowers that such Account or the Account Debtor is
unsatisfactory. In the event of any dispute whether an Account is or has ceased
to be an Eligible Account, the decision of the Lender shall control.
 
18)           "Eligible Inventory" means Inventory that Lender in its reasonable
credit judgment determines shall be "Eligible Inventory" and meets the following
criteria and conforms and continues to conform to the following conditions which
Lender may, in its sole discretion, establish, determine or adjust from time to
time:
 
a)      The title of Borrowers (or either of them) in and to the Inventory is
absolute and lawfully in Borrowers (or either of them) and subject to no prior
assignment, claim, lien or security interest, and Borrowers (or either of them)
have the right of assignment thereof and the power to grant to Lender a lien on
and security interest therein;
 
b)      The Inventory is intended for sale or lease by Borrowers in the ordinary
course of Borrowers’ business at regular prices;
 
c)      If the Inventory is represented by a Document, the Document is lawfully
owned by, and in possession of Borrowers, and Borrowers shall immediately
deliver such Document to Lender;
 
d)      The Inventory is located on Borrowers’ premises or on premises leased by
Borrowers with a landlord which has delivered to Lender a Landlord’s Waiver in
form and content acceptable to Lender;
 
e)      The Inventory is otherwise acceptable to Lender in its discretion;
 
f)      Eligible Inventory shall exclude all Inventory which is obsolete,
damaged, returned, consigned, leased, "on hold", bailed or determined by Lender
in its sole discretion to be ineligible in whole or in part and has so notified
Borrowers. Lender shall have the right, at any time and from time to time after
the Closing Date, to adjust any such criteria and to establish new criteria, all
in its reasonable credit judgment; and
 
g)      Advances based on Eligible Inventory shall be made only at the time
Borrowers (or either of them) obtains all rights to such Eligible Inventory.
 
19)   "Environmental Laws" shall mean any federal, state, county, regional or
local statute, law, ordinance, rule, regulation, order, directive, regulations
or requirement, together with all successor statutes, laws, ordinances, rules,
regulations, orders, directives, regulations or requirements governing the
control, storage, removal, spill, release or discharge of Hazardous Materials.
 
20)   "ERISA" shall mean the Employee Retirement Income Security Act of 1974
(together with all rules and regulations promulgated thereunder), as amended,
supplemented, replaced, or modified from time to time.
 
21)   "ERISA Affiliate" shall mean, as to each Borrower or the Borrowers, any
Person (whether or not incorporated), which, together with each Borrower or the
Borrowers, would be treated as a single employer under Section 4001 of ERISA.
 
22)   "Financial Statements" means the consolidated and consolidating balance
sheet, statements of income and retained earnings and statements of cash flow of
the Borrowers and its Subsidiaries and Affiliates and all other financial
statements of Borrowers and its Subsidiaries or Affiliates, prepared in
accordance with GAAP, submitted and to be submitted to Lender hereunder, and in
form and content acceptable to Lender.
 
23)   "Float Factor" shall mean the number of days described in Schedule 2.
 
 
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24)   "GAAP" or "generally accepted accounting principles" shall mean generally
accepted accounting principles applied on a consistent basis, in accordance with
the Statement of Auditing Standards No. 69, "The Meaning of Present Fairly in
Conformity with Generally Accepted Accounting Principles in the Independent
Auditor's Report" (SAS 69) or superseding pronouncements, issued by the Auditing
Standards Board of the American Institute of Certified Public Accountants and/or
in statements of the Financial Accounting Standards Board and/or in such other
statements by such other entity as Lender may reasonably approve, which are
applicable in the circumstances as of the date in question.  The requirement
that such principles be applied on a consistent basis shall mean that the
accounting principles observed in a current period are comparable in all
material respects to those applied in a preceding period, or, in the event of a
material change in any accounting principle from that observed in any previous
period, (a) financial reports covering preceding periods during the term of this
Agreement are restated to reflect such change and provide a consistent basis for
comparison among periods and (b) the financial covenants set forth herein, if
any, shall be adjusted as determined by the Lender to reflect similar
performance standards as those measured by the existing covenants using the
previously observed accounting principles.
 
25)   "Governmental Authority" means any nation or government, any state or
other political subdivision thereof, any central bank (or similar monetary or
regulatory authority) thereof, any entity exercising executive, legislative,
judicial, regulatory or administrative functions of or pertaining to government,
and any corporation or other entity owned or controlled, through stock or
capital ownership or otherwise, by any of the foregoing.
 
26)   "Indebtedness" means, as to any Obligor, all Liabilities, indebtedness or
obligations of Borrowers (or either of them) to any Person of any kind or
nature, now or hereafter arising, due and payable, or to become due and payable,
matured or unmatured, liquidated or unliquidated, direct, secondary or
contingent, fixed or otherwise, joint or several.
 
27)   "Ineligible Account" means all or any part of any Account that is not an
Eligible Account.
 
28)   “Intellectual Property” means
 
i) the names WLG (USA) LLC and  World Commerce Services, L.L.C., as well as all
fictional business names, trading names, registered and unregistered trademarks,
service marks, and applications;
 
ii) all patents, patent applications, and inventions and discoveries that may be
patentable;
 
iii) all copyrights in both published works and unpublished works;
 
iv) all rights in mask works; and
 
v) all know-how, trade secrets, confidential information, customer lists,
software, technical information, data, process technology, plans, drawings, and
blueprints; owned, used, or licensed by Borrowers.
 
29)   "Intercompany Accounts" means all assets and liabilities, however arising,
which are due to the Borrowers (or either of them) from, which are due from the
Borrowers (or either of them) to, or which otherwise arise from any transaction
by the Borrowers (or either of them) with, any Affiliate of the Borrowers
 
30)   "Inventory" means and includes all of the following, whether now owned or
hereafter acquired, new or used and wherever located;
 
a)      All tangible personal property or Goods or Equipment now owned or
hereafter acquired by Borrowers (or either of them), which are held for sale,
consignment or lease by Borrowers (or either of them) in the ordinary course of
Borrowers’ business or are furnished or to be furnished by Borrowers under
contracts of service;
 
b)      All tangible personal property or Goods or Equipment which Borrowers (or
either of them) have so consigned, leased or furnished, including all tangible
personal property or Goods or Equipment held by others for sale or consignment
from Borrowers (or either of them);
 
c)      All tangible personal property or Goods or Equipment sold by Borrowers
(or either of them) on a sale or return basis;
 
d)      All tangible personal property or Goods or Equipment returned to
Borrowers (or either of them) or repossessed by Borrowers (or either of them)
following a sale, consignment or lease thereof by Borrowers (or either of them)
and all Documents of Title (as that term is defined in the UCC) or certificates
of title or origin and tangible personal property represented thereby;
 
e)      All raw materials, ingredients, work in process, finished goods,
packaging materials, labels and other materials and supplies ("Materials") of
every kind or nature used, useful or consumed in connection with the production,
packaging, packing, shipping, installation, advertising or sale of such personal
property or Goods or Equipment;
 
f)      All Proceeds and products from the sale or other disposition of such
personal property or Goods, Equipment or Materials, including all personal
property, Goods, Equipment or Materials returned, repossessed or acquired by
Borrowers (or either of them) by way of substitution or replacement, and all
additions and accessions thereto, and all Documents and Instruments covering
such personal property, Goods, Equipment or Materials;
 
 
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g)      All of the rights or interests of Borrowers (or either of them)as an
unpaid seller, including stoppage in transit, detinue and reclamation; and
 
h)      All of the above owned by Borrowers (or either of them) or in which
Borrowers(or either of them)  now has or in which Borrowers(or either of
them)   may hereafter acquire an interest, whether in transit or in the
constructive or actual possession of Borrowers(or either of them)  or held by
Borrowers(or either of them)   or by others for the account of Borrowers(or
either of them)   (including any of the above held on consignment) including,
without limitation, all of the above which may be located at the property or
other premises of Borrowers or upon the premises of any carriers, forwarding
agents, truckers, warehousemen, vendors, selling agents, finishers, converters,
distributors, customers or other third parties who may have possession,
temporary or otherwise, thereof.
 
31)   “Inventory Certificate” means a certificate, satisfactory to Lender,
certified to be true and correct by an Authorized Financial Officer of Borrower
that accurately represents the breakdown, value and location of the then current
Inventory of Borrowers.
 
32)   "Laws" means all ordinances, statutes, rules, regulations, orders,
injunctions, writs or decrees of any Governmental Authority or agency thereof or
any court or similar entity established by any thereof.
 
33)   "Lien" means:
 
a)      Any interest in real, personal and intangible property securing an
obligation owed to, or a claim by, a Person other than the owner of the
property, whether such interest is based on the common law, statute, or
contract, and including a security interest, charge, claim, or lien arising from
a mortgage, deed of trust, encumbrance, pledge, hypothecation, assignment,
deposit arrangement, agreement, security agreement, conditional sale or trust
receipt or a lease, consignment or bailment for security purposes;
 
b)      To the extent not included under clause (a), any reservation, exception,
encroachment, easement, right-of-way, covenant, condition, restriction, lease or
other title exception or encumbrance affecting property; and
 
c)      Any contingent or other agreement to provide any of the foregoing.
 
34)   "Loan Documents" shall mean this Agreement, the Revolving Loan Note, the
Collateral Documents, Surety Agreement(s), Validity Indemnification(s),
Subordination Agreement(s), Letter(s) of Credit and/or any deed of trust,
mortgage, assignment of lease, note, contract, security instrument, encumbrance,
financing statement, certificate, assignment, pledge, report, subordination,
conditional sale, other title retention agreement, or other document related to
or delivered in connection with the transactions contemplated by this Agreement.
 
35)   "Material Adverse Change" shall mean any changes that could result in a
Material Adverse Effect.
 
36)   "Material Adverse Effect" shall mean any set of circumstances or events
which
 
a)      Has or could reasonably be expected to have any material adverse effect
whatsoever upon the validity or enforceability of this Agreement or any other
Loan Document,
 
b)      Is or could reasonably be expected to be material and adverse to the
properties, Assets, condition (financial or otherwise) or business operations,
results of operations of the Borrowers(or either of them)  , any Subsidiary or
to the prospects of Borrowers(or either of them)  , or any Subsidiary,
 
c)      Impairs materially or could reasonably be expected to impair materially
the ability of Borrowers (or either of them), or any Subsidiary to duly and
punctually pay or perform its Obligations or
 
d)      Materially impairs or could reasonably be expected to materially impair
the ability of the Lender to enforce its legal remedies pursuant to this
Agreement or any other Loan Document.
 
37)   "Obligations" means the obligations of any Obligor:
 
a)      To pay the principal of and all interest on all present and future Loans
and advances made hereunder in accordance with the terms hereof or otherwise to
or for the benefit of Borrowers (or either of them) and to satisfy all of its
other Indebtedness, obligations, liabilities, covenants, duties and Debts to
Lender for payment or performance, whether hereunder or otherwise, whether now
existing or hereafter incurred or arising, matured or unmatured, due or to
become due, absolute, direct or contingent, joint or several, primary or
secondary, including any extensions, modifications, renewals thereof and
substitutions therefor, whether or not evidenced by any note, agreement or other
Instrument or Document, whether arising from an extension of credit, opening of
a Letter of Credit, acceptance, loan, guaranty, indemnification, overdraft or
otherwise including all Indebtedness, liabilities or obligations arising from
any Obligor to others which the Lender may have obtained by purchase,
negotiation, discount, assignment or otherwise;
 
 
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b)      To repay to Lender all amounts advanced by Lender hereunder or under the
Loan Documents or otherwise on behalf of (or for the benefit of) any Obligor
including, without limitation, advances for principal or interest payments to
prior or subordinate secured parties, mortgagees, or lienors, or for taxes,
levies, insurance, rent, repairs to, maintenance or storage of any of the
Collateral; and
 
c)      To pay all of Lender's expenses and costs including without limitation,
all filing, recording and satisfaction fees, or taxes, and the fees and expenses
of its counsel in connection with the preparation, administration, amendment,
modification or enforcement of this Agreement and the documents required
hereunder, the perfection or maintenance of Lender's Liens on and security
interests in the Collateral, or any proceeding brought or threatened to enforce
payment of any of the Obligations referred to in the foregoing.
 
38)   "Obligor" means each Borrower, the Borrowers, each Surety, each
Indemnifier and any other Person directly or indirectly obligated with respect
to the Obligations.
 
39)   "Perfection Certificate" means the Perfection Certificate to be completed
and delivered by each Borrower prior to Closing with appropriate insertions and
signed by an Authorized Financial Officer of Borrower.
 
40)   “Permit” means any permit, license, registration, authorization or other
governmental approval required to be obtained and maintained under any
Environmental Law or other applicable law, rule or regulation of any
Governmental Authority.
 
41)   "Person" means any individual, sole proprietorship, corporation,
partnership, association, joint-stock company, trust, unincorporated
organization, joint venture, limited liability company, court, Governmental
Authority, government or political subdivision or agency thereof or any other
entity.
 
42)   "Plan" shall mean any pension plan, which is covered by Title IV of ERISA
and in respect of which each Borrower or the Borrowers, or any ERISA Affiliate
thereof is an "employer" as defined in Section 3(5) of ERISA.
 
43)   "Pledge Agreement" means an agreement in favor of Lender, in form and
content acceptable to Lender executed by any Person maintaining any property on
behalf of the Borrowers (or either of them), acknowledging Lender’s control over
and rights in and to the pledged property.
 
44)   "Real Estate" means the real property of WLG (USA) LLC and World Commerce
Services, L.L.C. located at 920 East Algonquin Road, Suite 120, Schaumburg, IL
60173 and all improvements thereon.
 
45)   "Records" means correspondence, memoranda, tapes, discs, CD-ROMS, papers,
books and other documents, or transcribed information of any type, whether
expressed in ordinary, computer, machine or electronic language and the
Equipment in which such information is stored or by which it is retrieved.
 
46)   “Remittances” means (a) all checks, drafts, cash and other remittances in
payment of or on account of payment of all its Accounts (including Ineligible
Accounts and Accounts with respect to which Lender has made no loan or advance
hereunder) and (b) whenever expressly required by Lender, the cash Proceeds of
any returned Goods from the sale of which any Account arose.
 
47)   "Reportable Event" shall mean any of the events set forth in Section
4043(b) of ERISA or the regulations thereunder.
 
48)   "Subordinated Debt" or "Subordinated Indebtedness" shall mean obligations
of Borrowers (or either of them) evidenced by a promissory note or notes or
other written instrument in form and content reasonably acceptable to Lender and
all collateral therefor, which are subordinated in right of payment, priority
and in all other respects to the right of Lender to receive payments on the
Loans and all collateral therefor, provided that the holder of the subordinated
debt has executed a subordination agreement in form and content reasonably
acceptable to Lender or the instrument evidencing the subordinated debt
expressly includes a provision, in form and content acceptable to Lender,
specifying that the instrument and all collateral therefor is subordinated to
the Obligations to and that Lender is an intended beneficiary of such provision.
 
49)   "Subsidiary" shall mean, as to each Borrower, any corporation of which
each Borrower directly or indirectly through one or more intermediaries owns or
controls at the time
 
a) at least a majority of the outstanding stock having, under ordinary
circumstances (not dependent upon the happening of a contingency), voting power
to elect a majority of the board of directors (in the case of a corporation
having directors), or
 
bi) a majority of the voting stock of any corporation not having directors.  The
term "Subsidiary" shall also mean any general or limited partnership or other
entity, of which more than fifty percent (50%) of the outstanding partnership
interests or ownership interests shall, at the time of determination, be owned,
directly or indirectly, through one or more intermediaries, by each Borrower.
 
50)   "Surety" means collectively, any corporation, partnership, limited
liability company or other business entity which is now or may hereafter become
a Surety under this Agreement (each a "Corporate Surety"), and any individual
which is now or may hereafter become a Surety under this Agreement (an
"Individual Surety"), all of which shall be collectively obligated hereunder.
 
51)   "Surety Agreement" means a duly authorized and executed surety agreement
in favor of Lender.
 
 
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52)   "Uniform Commercial Code" or "UCC" shall mean the Uniform Commercial Code
as in effect in the Commonwealth of Pennsylvania or of any other state in which
any Collateral is located from time to time, (or any successor statute) the laws
of which are required, as a result thereof, to be applied in connection with the
perfection of security interest in the Collateral.
 
53)   "Validity Certificate" means a duly authorized and executed Certificate in
favor of Lender.
 
54)   Other Definitional Provisions and Interpretive Provisions.
 
a)      The meanings of defined terms are equally applicable to the singular and
plural forms of the defined terms.
 
b)      The words "hereof," "herein," "hereunder" and similar words refer to
this Agreement as a whole and not to any particular provision of this Agreement;
and Paragraph, Subparagraph, Subsection, Section, Schedule references are to
this Agreement unless otherwise specified.
 
c)      The term "documents" includes any and all instruments, documents,
agreements, certificates, indentures, notices and other writings, however
evidenced.
 
d)      The term "including" is not limiting and means "including without
limitation."
 
e)      In the computation of periods of time from a specified date to a later
specified date, the word "from" means "from and including", the words "to" and
"until" each mean "to but excluding" and the word "through" means "to and
including."
 
f)      Unless otherwise expressly provided herein, (a) references to agreements
(including this Agreement) and other contractual instruments shall be deemed to
include all subsequent amendments and other modifications thereto, but only to
the extent such amendments and other modifications are not prohibited by the
terms of any Loan Document, and (b) references to any statute or regulation are
to be construed as including all statutory and regulatory provisions
consolidating, amending, replacing, supplementing or interpreting the statute or
regulation.
 
g)      This Agreement and the other Loan Documents may use several different
limitations, tests or measurements to regulate the same or similar matters.  All
such limitations, tests and measurements are cumulative and shall each be
performed in accordance with their terms.
 
h)      This Agreement and the other Loan Documents are the result of
negotiations among and have been reviewed by counsel to the Lender, each
Borrower, the Borrowers, and the other parties, and are the products of all
parties.  Accordingly, they shall not be construed against the Lender merely
because of the Lender’s involvement in their preparation.
 
 
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Schedule 2

This Schedule 2 dated this 24th day of February 2010, is attached to and made
part of that certain Loan and Security Agreement between WLG (USA) LLC and World
Commerce Services, L.L.C.  (each  a  "Borrower, and collectively the
“Borrowers”) and NOVA Business Credit, a division of  NOVA Bank ("Lender") dated
the 24th day of February 2010 (the "Agreement").
 
The Agreement is hereby modified by the additional terms and provisions set
forth in this Schedule 2 as such schedule may from time to time be amended and
supplemented by Lender in its sole discretion ("Additional Terms"), all of which
are incorporated into and made part of the Agreement as of the date hereof.  If
there is a conflict or discrepancy between the terms and provisions of this
Schedule 2, and any other Schedule 2 dated prior to the date hereof, or of the
Agreement, the terms and provisions of this Schedule 2 shall continue and
prevail.  All other terms and provisions of all Schedule 2’s dated prior to the
date hereof, and of the Agreement are hereby ratified and confirmed in all
respects and without condition are all incorporated herein by reference as if
set forth at length herein.
 
1)
Borrowing Base Rates of Advance:

 
 
a)
WLG (USA) LLC - Seventy percent (70%) of Eligible Accounts; plus

 
 
b)
World Commerce Services, L.L.C. - Eighty Percent (80%) of Eligible Accounts;
plus

 
 
c)
Such other percentages of the above as Lender may, from time to time at its sole
discretion, determine and give advance notice to Borrowers).

 
2)
Interest Rate(s):

 
 
a)
Eligible Accounts:  Base Rate (Wilmington Trust FSB Prime Rate) plus 3.0%
(floating with daily resets), but not to be less than 9.50% for advances against
accounts receivable;

 
3)
Fees:

 
 
a)
Origination Fee.  The Borrowers (or either of them) shall pay to Lender, on or
before the Closing Date a non-refundable origination fee ("Origination Fee") in
an amount equal to One Percent (1%) percent of the Revolving Credit Limit.

 
 
b)
Facility Fee.  The Borrowers (or either of them) shall pay to Lender, on or
before the annual anniversary of the Closing Date a non-refundable commitment
fee ("Facility Fee") equal to One Percent (1%) of the Revolving Credit Limit.

 
c)
Audit Fee.  The Borrowers (or either of them) shall reimburse Lender for the
cost of and related travel, out-of-pocket and other expenses.  Audits shall be
performed at such times as the Lender deems necessary or advisable in its sole
discretion. Ongoing collateral examinations are expected to be performed at
least quarterly.

 
d)
Collateral Management Fee.  The Borrowers (or either of them) shall pay Lender
monthly, a collateral management fee of 0.35% of the average monthly balance of
the Loans outstanding.  Such fee shall be due and payable on the first day of
each month in arrears.

 
4)
Float Factor:
Five (5) Business Days for checks; One (1) Business Day for wires.

 
5)
Account Concentration:  Not to exceed Fifteen Percent (15%) of total Accounts
Receivable except as approved in advance by Lender, at its sole discretion.

 

 
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Schedule 3
 
Collateral

1)      All money and cash of Borrowers (or either of them) and all property
of   Borrowers (or either of them)  which at any time Lender shall have in its
possession, or which is in transit to it, all amounts that may be owing from
time to time by Lender to  Borrowers (or either of them), and any balance or
share belonging, in whole or in part, to Borrowers (or either of them), in any
deposit, agency, trust, escrow or other account or accounts with any bank or
other financial institution (excluding all IRA, Keough and any trust, pension,
profit sharing and similar accounts subject to ERISA), including any certificate
of deposit;

2)      All Assets, including without limitation, all now owned or hereafter
acquired present and future Accounts (including Ineligible Accounts), Contract
Rights, Contracts, Chattel Paper, accounts receivable, notes receivable,
Documents, machinery, Equipment, Fixtures, furniture, Instruments, Inventory,
Investment Property, Letter-of- Credit Rights, Deposit Accounts, Payment
Intangibles, Health Care Insurance Receivables, Promissory Notes, Supporting
Obligations, General Intangibles, Goods, including any returned or repossessed
Goods and all rights of stoppage in transit and similar rights, Proceeds, all
lease or consignment agreements in which Borrowers (or either of them)  is
lessor, consignor or consignee and all rights of payment related to any of the
foregoing, and all liens and security instruments, books and Records evidencing,
securing or relating to the foregoing including, all data processing cards,
tapes, tabulating runs, programs, software and similar materials;

3)      All guarantees, sureties and endorsements of   Borrowers (or either of
them)  existing and future Accounts, Contracts, Contract Rights, Chattel Paper,
Documents, Instruments, accounts receivable, Investment Property,
Letter-of-Credit Rights, Deposit Accounts, Payment Intangibles, Health Care
Insurance Receivables, Promissory Notes, Supporting Obligations, and Inventory;

4)      All security or collateral held or taken by Borrowers (or either of
them) to secure the payment and/or satisfaction of any Account, Chattel Paper,
Contract, Contract Rights, Document, Instrument, account receivable, Investment
Property, Letter-of-Credit Rights, Deposit Accounts, Payment Intangibles, Health
Care Insurance Receivables, Promissory Notes, Supporting Obligations, or
Inventory, including any returned or repossessed Goods;

5)      All notes, drafts, acceptances, documents or certificates of title,
including bills of lading, warehouse receipts, policies and certificates of
insurance (including without limitation credit insurance), and securities
(domestic and foreign) now or hereafter owned by Borrowers (or either of them)
or in which   Borrowers (or either of them) has or acquires an interest in
connection with its Accounts, Contracts, Contract Rights, Chattel Paper,
Documents, Instruments, accounts receivable, Investment Property,
Letter-of-Credit Rights, Deposit Accounts, Payment Intangibles, Health Care
Insurance Receivables, Promissory Notes, Supporting Obligations, and Inventory;

6)      All other rights of  Borrowers (or either of them)  to the payment of
money, including, without limitation, tax refunds and amounts due from
Affiliates, and rights under any Letter of Credit;

7)      All rights in connection with the residual value of any Goods or
Inventory sold, leased, consigned or otherwise disposed of, including but not
limited to, the proceeds of any third party’s option to purchase such Inventory;

8)      All of the Borrowers’ (or either of their) rights in sale agreements,
rental agreements, lease agreements, bills of lading, documents of title,
warehouse receipts, charters, charter parties, bills of sale and other
agreements arising out of or relating to purchase of Goods or Inventory by or to
the Borrowers (or either of them), whether directly or through any Affiliate of
Borrower, or the sale, rental, lease, consignment or other disposition of the
such property or any portion thereof;
 
9)      All patents, processes, trade names, trademarks, copyrights, licenses,
now or hereafter affixed thereto, arising therefrom, used in connection
therewith, or related to the possession, use, manufacture, processing,
advertisement, sale, consignment, lease, other disposition or operation thereof;

10)    The Real Estate, the improvements, all materials, supplies, equipment,
apparatus and other items now or hereafter attached to, installed on or in the
Real Estate or any improvements thereon, or which in some fashion are deemed to
be Fixtures to the Real Estate or improvements;

11)    Any and all replacements and substitutions of all or any of the property
described in subparagraphs 1) through 10);

12)    All insurance and all rights of payment or other rights of   Borrowers
(or either of them) arising out of, related to, or in connection with any of the
foregoing;
 
 
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13)    All General Intangibles now or hereafter related to or arising from, used
in connection with or related to the possession, use, sale, lease, consignment
or other disposition of any of the foregoing and all insurance and all rights of
payment or other rights of  Borrowers (or either of them) arising out of,
related to, or in connection with any of the foregoing; and

14)    All Records pertaining to any of the foregoing.

 
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Schedule 4

Exceptions/Additional Information

Section 4.6
Additional Accounts:
   
Section 5.3.3
Permitted Liens:
   
Section 6.1.4
Litigation/Claims:
   
Section 6.1.9, 6.1.15  & 7.2.2
Indebtedness/Leases/Contracts:
   
Section 6.1.14
Other Liens
   
Section 6.1.16
Intellectual Property:
   
Section 6.1.23
Finder’s Fees:

 
 
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