Exhibit
10.1


 


FORM OF
ACCOUNT PURCHASE AGREEMENT


TO BE
EXECUTED BY CERTAIN SUBSIDIARIES OF


BROADWIND
ENERGY, INC.


 


This Account Purchase Agreement is dated as of September 28,
2010, is entered into between Wells
Fargo Bank, National Association (together with its successors and assigns, “WFBC”),
acting through its Wells Fargo Business Credit operating division, and
[                                                    ]
(the “Customer”).  The Customer and WFBC
agree as follows:


 


Article 1.

Purpose of Agreement


 


1.01        Purpose
of Agreement.  The Customer
desires to sell, transfer and assign to WFBC an undivided ownership interest in
all of the Customer’s right, title and interest in certain of its Accounts, all
Related Rights with respect thereto and all proceeds of the foregoing and WFBC
desires to purchase such undivided ownership interest in all of the Customer’s
right, title and interest in such Accounts, all Related Rights with respect
thereto and all proceeds of the foregoing on the terms and conditions set forth
herein.  The purchase of Accounts and
Related Rights hereunder shall be full recourse and shall be on a
non-notification of assignment basis except upon the occurrence and during the
continuation of an Event of Termination. 
The purpose of this Agreement is commercial in nature and not for
household, family or personal use.  Terms
which are not defined herein shall have the meaning set forth in the Uniform
Commercial Code as adopted in the State of Colorado.  The Customer acknowledges and agrees that
WFBC has not made any representations or warranties concerning the tax,
accounting or legal characteristics of the transaction set forth herein and in
the Related Documents and that the Customer has obtained and relied upon such
tax, accounting and legal advice from its own experts concerning such
transaction as it deems appropriate.


 


Article 2.

Definitions


 


2.01        “Acceptable
Account” means an Account, in an amount equal to the aggregate face
amount of such Account, net of any credits or allowances of any nature, which (a) conforms
to the representations, warranties and terms set forth herein and (b) is
not an Unacceptable Account as defined below.


 


2.02        “Account”
means any right of payment of the net amount for goods sold, or
leased and delivered or services rendered in the ordinary course of the
Customer’s business which is not evidenced by an instrument or chattel paper.


 


2.03        “Account
Debtor” means the Customer’s customer or any other Person owing
money to the Customer with respect to an Account.


 


2.04        “Affiliate” means (a) any Person that directly, or
indirectly through one or more intermediaries, controls another Person (as used
in this Section 2.04, a “Controlling
Person”) or 


 

















 


(b) any
Person which is controlled by or is under common control with a Controlling
Person.  As used herein, the term “control” means possession, directly or
indirectly, of the power to vote ten percent (10%) or more of any class of
voting securities of a Person or to direct or cause the direction of the
management or policies of a Person, whether through the ownership of voting
securities, by contract or otherwise.


 


2.05        “Affiliate
Account Purchase Agreements” means (a) the Account Purchase Agreement by
and between Tower Tech and WFBC, (b) the Account Purchase Agreement by and
between Brad Foote and WFBC, (c) the Account Purchase Agreement by and
between Energy Maintenance Service and WFBC, and (d) the Account Purchase
Agreement by and between Badger Transport and WFBC, each dated as of the date
hereof and each as amended or otherwise modified.


 


2.06        “Affiliate
Customer” means any Person, other than WFBC, party to an Affiliate
Account Purchase Agreement.


 


2.07        “Aggregate
Facility Maximum” means
$10,000,000.


 


2.08        “Agreement” means this Account Purchase Agreement.


 


2.09        “Assignment
and Schedule of Accounts” means the Assignment and Schedule of Accounts, a form of which is
attached hereto as Exhibit A, as the form may be revised from time to time
by WFBC in its sole discretion by notice to Customer.


 


2.10        “Badger Transport” means Badger Transport, Inc., a Wisconsin
corporation.


 


“Brad Foote” means
Brad Foote Gear Works, Inc., an Illinois corporation.


 


2.11        “Broadwind
Energy” means Broadwind Energy, Inc.,
a Delaware corporation.


 


2.12        “Business
Day” means a day on
which the Federal Reserve Bank of New York is open for business.


 


2.13        “Change
of Control”
means the occurrence of any of the following events:


 


(a)           Any Person or “group” (as such term
is used in Sections 13(d) and 14(d) of the Securities
Exchange Act of 1934) who does not have an ownership interest in the
Customer on the Closing Date is or becomes the “beneficial owner” (as
defined in Rules 13d-3 and 13d-5 under the Securities Exchange Act
of 1934, except that any such Person, entity or group will be deemed to
have “beneficial ownership” of all securities that such Person, entity or group
has the right to acquire, whether such right is exercisable immediately or only
after the passage of time), directly or indirectly, of more than twenty
percent (20%) of the voting power of all classes of ownership of the
Customer; provided that WFBC must be notified of all owners with 20% or
greater ownership and of any individual with 10% ownership who is a family
member of another owner; or


 


(b)           During any consecutive two-year
period, individuals who at the beginning of such period constituted the board
of directors of the Customer (together with any new directors whose 


 


2

















 


election to such board of
directors, or whose nomination for election by the shareholders of the
Customer, was approved by a vote of at least two-thirds of the directors then
in office who were either directors at the beginning of such period or whose
election or nomination for election was previously so approved) cease for any
reason to constitute a majority of the board of directors of the Customer then
in office.


 


2.14        “Closing
Date” means September 29, 2010.


 


2.15        “Collateral”
shall mean all of the following property of the Customer whether now owned or
existing or hereafter created or acquired or arising, or in which the Customer
now has or hereafter acquires any rights, and wheresoever located:  (a) all
of the Purchased Accounts  and all
of the Related Rights, together with: (b) all cash proceeds of the
Purchased Accounts; (c) all related chattel paper (including electronic
chattel paper); (d) all related commercial tort claims; (e) all
related documents (including warehouse receipts, bills of lading, and other
documents of title); (f) all related general intangibles (including (i) payment
intangibles and (ii) all other choses in action, causes of action,
actions, suits, and other legal proceedings of any kind, but excluding
intellectual property); (g) all related instruments; (h) all related
investment property; (i) all related letters of credit and letter of
credit rights; (j) all related supporting obligations; (k) the
Collected Reserve Account and all monies and other things of value contained in
the Collected Reserve Account or any of the Customer’s blocked accounts,
lockbox accounts or collateral accounts established with or for the benefit of
WFBC for purposes of this Agreement, and all items in any lockbox established
with or for the benefit of WFBC for purposes of this Agreement; (l) all
Records and all other tangible and electronic books and records pertaining to
any of the foregoing (including all mail and electronic mail); (m) all
amendments, modifications, products, replacements, and substitutions to any of
the foregoing; (n) all collateral subject to the Lien of any Related
Document; (o) all money and other assets of the Customer that now or
hereafter come into the possession, custody, or control of WFBC; and (p) all
proceeds (including cash, insurance and condemnation proceeds) pertaining to
any of the foregoing.  The term “related”
as used in this definition means related to the Purchased Accounts.


 


2.16        “Collected
Reserve Account”
means the internal general ledger account to and from which from time to time
credits, debits and disbursements will be made in accordance with this
Agreement.


 


2.17        “Confidential Information” shall have the meaning set forth in Section 11.17.


 


2.18        “Credit
and Collection Policy” means the Customer’s credit, collection and
administration policies and procedures relating to the Accounts (including the
Purchased Accounts) and the Related Rights, certain parameters of which are set
forth in that certain document entitled “Broadwind Energy, Inc.
Authorization Matrix (as of January 1, 2010), a copy of which has been
provided to, and approved by, WFBC, as such policies and procedures may be
amended in compliance with Section 6.02.


 


2.19        “Energy
Maintenance Service” means Energy
Maintenance Service, LLC, a Delaware limited liability company.


 


2.20        “Event
of Termination” shall have the meaning set forth in Article 9.


 


3

















 


2.21        “Facility
Maximum” means, subject to the availability of Acceptable Accounts,
$10,000,000 less the aggregate Outstanding Balance (as defined in the
applicable Affiliate Account Purchase Agreement) of all Purchased Accounts (as
defined in the applicable Affiliate Account Purchase Agreement) under the
Affiliate Account Purchase Agreements.


 


2.22        “Fee
Ratio” means, for a
certain period, a fraction, the numerator of which is the aggregate Purchased
Amount on the last day of such period and the denominator of which is the sum
of the aggregate Purchased Amount on the last day of such period plus the
aggregate Purchased Amount (as defined in each Affiliate Account Purchase
Agreement) under each Affiliate Account Purchase Agreement on the last day of
such period; provided, however, that if such calculation results in the Fee
Ratio being zero or if the aggregate Purchased Amount on the last day of such
period is zero for any Affiliate Customer, then the Fee Ratio shall mean, for
the applicable period, a fraction, the numerator of which is one (1) and
the denominator of which is the sum of the number of Affiliate Account Purchase
Agreements in full force and effect on the last day of such period plus one
(1).


 


2.23        “Final
Termination Date” shall have the meaning set forth in Section 11.26.


 


2.24        “Former
Plan” means any
employee benefit plan in respect of which the Customer or a Subsidiary has
engaged in a transaction described in Section 4069 or Section 4212(c) of
ERISA.


 


2.25        “Guarantor”
means Broadwind Energy, Badger Transport, Brad Foote, Energy Maintenance
Service, Tower Tech and  every
other Person now or in the future who agrees to guaranty the obligations of the
Customer to WFBC.


 


2.26        “Guaranty”
means each guaranty of Customer’s obligations to WFBC executed by a Guarantor
in favor of WFBC.


 


2.27        “Indemnified
Liabilities” shall have the meaning set forth in Section 11.07(a).


 


2.28        “Indemnitees”
shall have the meaning set forth in Section 11.07(a).


 


2.29        “Insolvency” means, with respect to any Multiemployer
Plan, the condition that such Plan is insolvent within the meaning of Section 4245
of ERISA.


 


2.30        “Insolvency
Proceeding” means any proceeding under Title 11 of the United States
Code or under the Bankruptcy and Insolvency Act (Canada) or the Companies
Creditors Arrangement Act (Canada), any general assignment for the benefit of
creditors, any proceeding instituted by or against a Person seeking
liquidation, winding up, reorganization, arrangement, adjustment, protection,
relief or composition of it or its debts under any law relating to bankruptcy,
insolvency, reorganization or relief of debtors, or any proceeding seeking the
entry of an order for relief by the appointment of a receiver, trustee,
custodian or similar official for its or a substantial part of its property.


 


2.31        “LIBOR”
means, as of a
selected date, the rate per annum (rounded upward, if necessary, to the nearest
whole 1/16th of one
percent (1.0%)) determined pursuant to the following formula:


 


4

















 


	
  LIBOR =

  	
  Base LIBOR

  	
   

  
	
   

  	
  100% - LIBOR Reserve Percentage

  	
   

  



 


(a)           “Base LIBOR” means the rate per annum for United States
Dollar deposits quoted by Wells Fargo Bank, N.A. for the purpose of calculating
the effective floating interest rate for loans that reference Daily Three Month
LIBOR as the Inter-Bank Market Offered Rate in effect from time to time for
three (3) month delivery of funds in amounts approximately equal to the
principal amount of such loans.


 


(b)           “Daily Three Month LIBOR” means, for any day, the rate of interest equal to LIBOR then in effect
for delivery for a three (3) month period.  When interest is
determined in relation to Daily Three Month LIBOR, each change in the interest
rate shall become effective each Business Day that WFBC determines that
Daily Three Month LIBOR has changed.


 


(c)           “LIBOR Reserve Percentage” means the reserve percentage prescribed by the Board of Governors of the
Federal Reserve System (or any successor) for “Eurocurrency Liabilities” (as
defined in Regulation D of the Federal Reserve Board, as amended), adjusted by
WFBC for expected changes in such reserve percentage during the term of this
Agreement.


 


The Customer understands and agrees that WFBC may
base its quotation of the Inter-Bank Market Offered Rate upon such offers or
other market indicators of the Inter-Bank Market as WFBC in its discretion
deems appropriate, including the rate offered for U.S. Dollar deposits on the
London Inter-Bank Market.  WFBC’s determination of LIBOR shall be
conclusive, absent manifest error.


 


2.32        “Lien” means any security interest, assignment
(whether absolute or by way of security), mortgage, deed of trust, pledge, lien
(statutory or otherwise), charge, encumbrance, title retention agreement or
analogous instrument or device, including without limitation the interest of
each lessor under any capitalized lease and the interest of any bondsman under
any payment or performance bond, in, of or on any assets or properties of a
person or entity, whether now owned or subsequently acquired and whether
arising by agreement or operation of law.


 


2.33        “Material
Adverse Effect”
means any effect upon the business, operations, property or financial or other
condition of Broadwind Energy and its Subsidiaries, taken as a whole, which, in
the sole determination of WFBC, materially adversely affects (a) the
interest of WFBC in the Purchased Accounts, the Related Rights or the
Collateral, (b) the collectibility and enforceability of the Purchased
Accounts, the Related Rights or the Collateral or WFBC’s rights thereunder or (c) the
ability of Broadwind Energy and its Subsidiaries, taken as a whole, to perform
their obligations under this Agreement or any of the Related Documents.


 


2.34        “Multiemployer
Plan” means a Plan
which is a multiemployer plan as defined in Section 4001(a)(3) of
ERISA.


 


2.35        “Other
Taxes” shall have the
meaning set forth in Section 11.20(b).


 


5

















 


2.36        “Outstanding
Balance” means, for any Purchased Account, the total amount due and
payable by the Account Debtor for goods or services rendered by the Customer in
respect of such Purchased Account, after reduction for any payments, discounts,
credits, rebates, allowances, reserves, incentives, penalties or other
reductions or similar adjustments, as determined by WFBC in it sole discretion.


 


2.37        “Participant”
shall have the meaning set forth in Section 11.02.


 


2.38        “PBGC”
means the Pension
Benefit Guaranty Corporation established pursuant to Subtitle A of Title IV of
ERISA (or any successor thereto).


 


2.39        “Permitted
Lien” and “Permitted Liens” shall have the meaning set forth in
Section 6.11.


 


2.40        “Person”
means any individual, corporation, partnership, joint venture, limited
liability company, association, joint stock company, trust, unincorporated
organization or government or any agency or political subdivision of a
governmental entity.


 


2.41        “Plan”
means, at a
particular time, any employee benefit plan which is covered by ERISA and in
respect of which the Customer or a Subsidiary is an “employer” as defined in Section 3(5) of
ERISA.


 


2.42        “Purchase
Limit” means the limit WFBC sets from time to time in its sole
discretion establishing the maximum gross face amount of Purchased Accounts which are
approved as Acceptable Accounts at any given time owed by a particular Account
Debtor.


 


2.43        “Purchase
Price” means, for any
Purchased Account and the Related Rights with respect thereto, an amount equal
to 80% of the gross face amount of such Purchased Account, less any charges
with respect to such Purchased Account and less any amount of any trade
discounts, credits or allowances, or any other reductions or adjustments to
such Purchased Account taken by the Account Debtor.  This percentage
may be adjusted by WFBC at any time at WFBC’s sole discretion.


 


2.44        “Purchased
Account”
and “Purchased Accounts” shall have the meanings set forth in Section 3.01(a).


 


2.45        “Purchased
Amount” means, at any
time, an amount equal to (a) the aggregate Purchase Price, minus (b) the
aggregate amount paid to WFBC hereunder on account of Purchased Accounts and
Related Rights, net of all fees, interest, expenses and costs hereunder.


 


2.46        “Records”
means all tangible and electronic books, records, reports and other documents
and information (including hard copies of all data maintained in databases of
the Customer on tapes, disks and punch cards) maintained in respect of the
Purchased Accounts, the Related Rights, the Collateral and the Account Debtors.


 


2.47        “Related
Document” means any agreement, document, exhibit, notice or other
written communication to which the Customer is a party or which has at any time
been delivered by or 


 


6

















 


on
behalf of the Customer to WFBC in connection with this Agreement, including
each Guaranty.


 


2.48        “Related
Rights” shall have the meaning set forth in Section 3.01.


 


2.49        “Related
Security”
means, with respect to the Purchased Accounts, (a) all Liens, and all
property subject thereto, from time to time purporting to secure payment of any
Purchased Account, including any security deposit, whether pursuant to any
related agreement or otherwise; (b) all of Customer’s right, title and
interest in, to and under all guarantees, indemnities, letters of credit,
insurance policies (and proceeds and premium refunds thereof) and other
agreements or arrangements of whatsoever character from time to time supporting
or securing payment of any Purchased Account, whether pursuant to the related agreement
or otherwise; (c) all related Records; and (d) all proceeds of or
relating to the foregoing and any Purchased Account.


 


2.50        “Reorganization” means with respect to any Multiemployer Plan,
the condition that such plan is in reorganization within the meaning of Section 4241
of ERISA.


 


2.51        “Reportable
Event” means any of the
events set forth in Section 4043(c) of ERISA, other than those events
as to which the thirty day notice period is waived under
PBGC Reg. § 2615 or any successor regulation thereto.


 


2.52        “Repurchase
Price” means, for any
Purchased Account and the Related Rights with respect thereto, (a) the
lesser of (i) the Purchase Price related to such Purchased Account and the
Related Rights with respect thereto and (ii) the Outstanding Balance of
such Purchased Account, plus (b) all fees, costs or expenses associated
with the repurchase or collection of such Purchased Account and the Related
Rights with respect thereto.


 


2.53        “Single
Employer Plan”
means any Plan which is covered by Title IV of ERISA, but which is not a
Multiemployer Plan.


 


2.54        “Subsidiary”
means, as to any Person, any corporation or other entity of which securities or
other ownership interests having ordinary voting power to elect a majority of
the board of directors or other persons performing similar functions are at the
time directly or indirectly owned by such Person; unless otherwise specified, “Subsidiary” means a Subsidiary of the
Customer.


 


2.55        “Taxes” shall have the meaning set forth in Section 11.20(a).


 


2.56        “Termination
Date” means the earliest of (a) September 29,
2013, (b) the date the
Customer terminates this Agreement pursuant to Section 3.11, (c) the date on which an Event of Termination
described in Section 9.01(d) occurs, or (d) during the
continuation of an Event of Termination, the date on which WFBC exercises its
right to cease purchasing Accounts.


 


2.57        “Tower
Tech” means Tower Tech Systems Inc., a Wisconsin corporation.


 


2.58        “Unacceptable
Account” means any Account which is not acceptable in WFBC’s sole discretion
including the following:


 


7

















 


(a)           Accounts unpaid one hundred twenty
(120) days or more after the invoice date;


 


(b)           Accounts owed by any unit of
government, whether foreign or domestic (provided, however, that Unacceptable
Accounts shall not include that portion of Accounts owed by such units of
government for which the Customer has provided evidence satisfactory to WFBC
that (i) WFBC has a first priority perfected security interest in such
Accounts and (ii) such Accounts may be enforced by WFBC directly against
such unit of government under all applicable laws);


 


(c)           Accounts not payable in United States
Dollars;


 


(d)           Any Account which is not an “account”
or “payment intangible” within the meaning of Article 9 of the Uniform
Commercial Code of all applicable jurisdictions;


 


(e)           Any Account which (i) does not
arise under a contract which is in full force and effect, (ii) does not
constitute the legal, valid and binding obligation of the related Account
Debtor enforceable against such Account Debtor in accordance with its terms, (iii) is
subject to counterclaim, defense or other Lien (other than Permitted Liens), or
(iv) is an executory contract or unexpired lease within the meaning of Section 365
of the Bankruptcy Code;


 


(f)            Any Account which arises under a
contract which (i) does not contain an obligation to pay a specified sum
of money or is subject to contingencies, (ii) requires the Account Debtor
under such contract to consent to the sale, transfer or assignment of the
rights to payment under such contract (except to the extent such requirement is
made ineffective by Uniform Commercial Code Section 9-406), (iii) limits
or restricts the sale, transfer or assignment (whether absolutely or by way of
security) of such contract, or (iv) contains a confidentiality provision
that purports to restrict WFBC’s exercise of rights under this Agreement,
including the right to review such contract;


 


(g)           Any Account which, in whole or in
part, contravenes any law, rule or regulation applicable thereto
(including those relating to usury, truth in lending, fair credit billing, fair
credit reporting, equal credit opportunity, fair debt collection practices and
privacy), which contravention would reasonably be expected to have a Material
Adverse Effect;


 


(h)           Accounts owed by an Account Debtor
which (i) is not acceptable to WFBC or (ii) is located outside the
United States or Canada;


 


(i)            Accounts owed by an Account Debtor
that is insolvent, the subject of an Insolvency Proceeding or has ceased doing
business;


 


(j)            Accounts owed by an owner,
shareholder, Subsidiary, Affiliate, officer or employee of the Customer;


 


(k)           Accounts not beneficially or legally
owned by the Customer immediately prior to purchase by WFBC;


 


8

















 


(l)            Accounts which represent
indebtedness of an Account Debtor that constitutes an illegal, invalid or
unenforceable obligation of such Account Debtor to pay the amount thereof on
the maturity date stated therein;


 


(m)          Accounts which, upon purchase by WFBC,
are not subject to a duly perfected Lien in WFBC’s favor or which are subject
to any Lien in favor of any Person other than WFBC, including any payment or
performance bond;


 


(n)           Accounts that have been restructured,
extended, amended or modified prior to purchase by WFBC (to the extent not
previously disclosed by Customer to WFBC) or at any time after purchase by
WFBC;


 


(o)           Except to the extent made ineffective
by Uniform Commercial Code Section 9-406, any Account whose sale, transfer
or assignment (whether absolutely or by way of security) is limited or
restricted by the terms of the contract evidencing or relating to such Account
(unless such limitation or restriction has been complied with and WFBC is
satisfied in its sole discretion that the sale, transfer or assignment of such
Account hereunder is valid and effective);


 


(p)           That portion of Accounts that
constitutes freight fees, allowances, finance charges, service charges or sales
or excise taxes;


 


(q)           Accounts that have been invoiced,
paid or partially paid in advance of the full delivery and acceptance of goods
or the performance and acceptance of services or in advance of the submission
of such Accounts to WFBC (provided that WFBC, in its sole discretion, may agree
to purchase some or all of the portion of an Account not partially paid in
advance);


 


(r)            Any Account which (i) does not
satisfy in all material respects all applicable requirements of the Credit and
Collection Policy or (ii) was not generated in the ordinary course of the
Customer’s business;


 


(s)            Any Account as to which not all of
the related invoices have been made available to WFBC in a form acceptable to
WFBC, and which are not included in an Assignment and Schedule of Accounts
acceptable to WFBC in its sole discretion prior to the proposed purchase of
such Accounts;


 


(t)            Any Account which is subject to any
asserted reduction (including any reduction on account of any offsetting
account payable of the related Account Debtor or the Customer to an Account
Debtor or any reduction on account of any application of a deposit or advance
payment made to the Customer), cancellation, rebate or refund, deduction,
withholding, discount or any dispute, offset, counterclaim, Lien or defense
whatsoever; provided that an Account that is subject only in part to any of the
foregoing but otherwise qualifies as an Acceptable Account (as determined by
WFBC in its sole discretion) shall be an Acceptable Account to the extent not
subject to reduction, cancellation, refund, rebate, deduction, withholding,
discount, dispute, offset, counterclaim, Lien or other defense;


 


(u)           Accounts which would cause the
Purchase Limit for such Account Debtor to be exceeded;


 


9

















 


(v)           Accounts which would cause the
Purchased Amount to exceed the Facility Maximum; and


 


(w)          Accounts, or portions thereof, that
fail to conform to the representations and warranties contained herein or are
otherwise deemed unacceptable by WFBC in its sole discretion.


 


2.59        “Uniform
Commercial Code” means the Uniform Commercial Code as in effect from
time to time in the State of Colorado; provided, however, to the extent the law
of any other state or other jurisdiction applies to the attachment, perfection,
priority or enforcement of any Lien granted to WFBC in any of the Collateral, “Uniform Commercial Code” means the Uniform
Commercial Code as in effect in such other state or jurisdiction for purposes
of the provisions hereof relating to such attachment, perfection, priority or
enforcement of a Lien in such Collateral. 
To the extent this Agreement defines the term “Collateral” by reference
to terms used in the Uniform Commercial Code, each of such terms shall have the
broadest meaning given to such terms under the Uniform Commercial Code as in
effect in any state or other jurisdiction.


 


2.60        “Unused
Fee” shall have the
meaning set forth in Section 3.08(b).


 


2.61        “Wells
Receivers” shall
have the meaning set forth in Section 11.17.


 


2.62        “WFBC
Discount” means, with respect to each Purchased Account and the
Related Rights with respect thereto, an amount equal to the lesser of (i) the
sum of LIBOR plus three and three-quarters of one percent (3.75%) per annum, or
(ii) the lawful maximum, if any, in effect from time to time for advances
to customers of the type, in the amount, for the purposes and otherwise of the
kind herein contemplated.  Upon the
occurrence and during the continuation of an Event of Termination, with respect
to each Purchased Account and the Related Rights with respect thereto, the WFBC
Discount shall be equal to the sum of LIBOR plus six and three-quarters of one
percent (6.75%) per annum, or such lesser amount as WFBC in its sole discretion
may determine (but in no event shall such fee be more than the lawful maximum,
if any, in effect from time to time for advances of the type, in the amount,
for the purposes and otherwise of the kind herein contemplated).  The WFBC Discount shall be calculated on the
basis of a 360-day year for the actual number of days elapsed.


 


2.63        “WFBC
Discount Fee”
shall have the meaning set forth in Section 3.08(c).


 


Article 3.

Purchase and Assignment of Accounts


 


3.01        Purchase
and Assignment of Accounts. 
Pursuant to the terms herein and in consideration for amounts paid to
the Customer on the date hereof as well as amounts paid to the Customer during
the term hereof, the Customer hereby agrees to sell, transfer and assign to
WFBC, with recourse, as absolute owner, and WFBC hereby agrees to purchase from
the Customer, during the period from the Closing Date to but excluding the
Termination Date, as of the date of each delivery of each Assignment and
Schedule of Accounts acceptable to WFBC in its sole discretion, all of the
Customer’s right, title and interest in and to the following:


 


10






 












 


(a)           Each Acceptable Account presented by
the Customer on or after September 28, 2010  to, but excluding, the Termination Date which is
offered for sale, transfer and assignment by the Customer pursuant to an
Assignment and Schedule of Accounts delivered to WFBC by the Customer and
accepted by WFBC in its sole discretion (collectively,
the “Purchased Accounts” and each, a “Purchased Account”);


 


(b)           All rights of action (including all
rights of stoppage in transit, replevin, repossession, reclamation,
setoff, detinue, repurchase and all other rights of action of a consignor,
consignee, unpaid vendor, mechanic, artisan or other lienor) accrued or to
accrue on each Purchased Account, including full power to collect, sue for,
compromise, assign, in whole or in part, or in any other manner enforce
collection thereof in the Customer’s name or otherwise;


 


(c)           All right, title and interest of the
Customer in and to the Records, the Related Security, all agreements, documents
or instruments relating to the Purchased Accounts and the proceeds thereof, and
all deposits and other security for the obligation of any Person under or
relating to the Purchased Accounts, in each case whether presently existing or
hereafter arising, now owned or hereafter acquired;


 


(d)           All inventory and goods relating to,
or which by sale have resulted in, Purchased Accounts, including all returned
inventory and goods; and


 


(e)           All proceeds of the foregoing in any
form (collectively, with the assets described in Section 3.01(b), Section 3.01(c),
and Section 3.01(d), the “Related Rights”).


 


The foregoing sales, transfers and assignments do
not constitute, and are not intended to result in, an assumption by WFBC of any
liability or obligation of the Customer or any other Person in connection with
the Purchased Accounts, the Related Rights or under any agreement or instrument
relating thereto.


 


3.02        Approval.  WFBC shall not purchase
an Account and the Related Rights with respect thereto unless such Account is
first submitted to WFBC by the Customer for approval.  WFBC is not
obligated to buy from the Customer any Account and the Related Rights with
respect thereto that WFBC does not deem acceptable in its sole discretion.


 


3.03        Required
Forms. 
When the Customer offers an Account and the Related Rights with respect thereto
to WFBC for sale, transfer and assignment, WFBC shall receive (a) an
Assignment and Schedule of Accounts, in a form satisfactory to WFBC in its sole
discretion and signed by an authorized representative of the Customer, (b) an
original invoice or an electronic equivalent thereof, either of which must be
in a form acceptable to WFBC in its sole discretion, (c) a copy of the
bill of lading if applicable, (d) proof of delivery, (e) contract,
purchase order, or purchase order number which corresponds with such invoice,
as appropriate to the business of the Customer, and (f) any other document
which WFBC may require.


 


3.04        Purchase.  Upon approval and acceptance by WFBC
of an Account and the Related Rights with respect thereto for the sale,
transfer and assignment to WFBC of such Account and such Related Rights, WFBC
shall purchase and the Customer shall sell, transfer and assign to WFBC such
Account and
such Related Rights.


 


11

















 


3.05        Purchase
Price. 
As consideration for the sale, transfer and assignment to WFBC of an Account
and the Related Rights with respect thereto, WFBC shall pay to the Customer the
Purchase Price for such Account and such Related Rights on the terms and
conditions as stated herein.


 


3.06        Payment
of Purchase Price.  Upon the sale, transfer and assignment of an Account and the
Related Rights with respect thereto to WFBC, and receipt of all documents and
forms described in Section 3.03 and upon fulfillment of all applicable
conditions precedent to such sale, transfer and assignment as more fully set
forth herein, WFBC shall pay the Purchase Price for such Purchased Account and
such Related Rights to the Customer as follows, as determined by WFBC in its
sole discretion:  (i) WFBC shall pay
such Purchase Price to the Customer or to any third party at the Customer’s
written direction to WFBC, or (ii) WFBC shall advance such Purchase Price
to the Collected Reserve Account.


 


3.07        Repurchase
of Accounts.  The Customer
shall (a) repurchase any and all Purchased Accounts and the Related Rights
with respect thereto, whether disputed or undisputed, as may be requested by
WFBC, from time to time in its sole discretion, and (b) pay within three (3) Business
Days after demand the Repurchase Price for such Purchased Accounts and the
Related Rights with respect thereto. 
WFBC may demand that the Customer repurchase a Purchased Account:  (a) which remains unpaid one hundred
twenty (120) days after its invoice date, (b) which is owed by an Account
Debtor who has filed, or has had filed against it, an Insolvency Proceeding, or
(c) with respect to which there has been any breach of representation or
warranty set forth in Article 5.  In
any event where repurchase is required under this Agreement, WFBC, at its
discretion, may charge the Repurchase Price to the Customer’s Collected Reserve
Account which may create a deficit balance in the Collected Reserve Account.


 


3.08        Fees.


 


(a)           Facility Fee.  The Customer shall pay WFBC a fully earned annual facility fee
equal to (i) $25,000, payable on the Closing Date and (ii) $100,000
times the Fee Ratio for such year, payable on each anniversary of the Closing
Date until the Final Termination Date.


 


(b)           Unused Fee.  From the Closing Date to and including the Final Termination Date, the
Customer shall pay WFBC an unused fee (the “Unused Fee”) in the amount of (i) forty-two
one thousandths of one percent (0.042%) per annum, times (ii) the result
of (A) the Aggregate Facility Maximum less (B) the aggregate average
daily Purchased Amount during such month plus the aggregate average daily
Purchased Amount (as defined in each Affiliate Account Purchase Agreement)
under each Affiliate Account Purchase Agreement during such month, times (iii) the
Fee Ratio for such month, which Unused Fee shall be payable monthly in arrears
on the fifteenth (15th) day of each month and on the Final Termination Date.


 


(c)           WFBC Discount Fee.  The Customer shall pay WFBC a fully earned fee equal to the
product of the WFBC Discount multiplied by the aggregate Outstanding Balance of
the Purchased Accounts (the “WFBC Discount Fee”).  The WFBC Discount Fee
shall accrue daily and shall be due and payable in arrears on the first day of
each month and on the Final Termination Date.


 


12

















 


(d)           Audit Fees.  The Customer shall pay WFBC, on demand, audit fees in connection
with any audits or inspections conducted by WFBC of the Purchased Accounts, the
Related Rights, the Collateral or the Customer’s operations or business, at the
rates established from time to time by WFBC as its audit fees, together with
all actual out of pocket costs and expenses incurred in conducting any such
audit or inspection.


 


(e)           Termination
Fee.  If the Termination Date
occurs on or before September 29, 2013 pursuant to Section 3.11,
the Customer shall pay WFBC on the Termination Date a fully earned termination
fee equal to:  (i) three percent
(3%) of the Facility Maximum, if this Agreement is terminated on or before the
first anniversary of the Closing Date; (ii) two percent (2%) of the
Facility Maximum, if this Agreement is terminated after the first anniversary
of the date hereof but on or before the second anniversary of the Closing Date;
and (iii) one percent (1%) of the Facility Maximum, if this Agreement is
terminated after the second anniversary of the date hereof but on or before the
third anniversary of the Closing Date. 
Notwithstanding the foregoing, the Customer shall not be required to pay
any termination fee in the event this Agreement is terminated after the first
anniversary of the date hereof (i) as a result of or in connection with
refinancing or replacement financing with Wells Fargo Bank, National
Association or any affiliate or division of Wells Fargo Bank, National
Association or (ii) by Customer after demand by WFBC for a payment under Section 11.08
of this Agreement.


 


3.09        Mandatory
Payments.  Unless WFBC shall otherwise consent in a
written agreement that sets forth the terms and conditions which WFBC in its discretion
may deem appropriate, if the Purchased Amount is at any time greater than the
Facility Maximum, the Customer shall pay to WFBC, upon demand, the amount
necessary to eliminate such excess.  Any
such payment received by WFBC under this Agreement may be applied to the
amounts owing to WFBC from the Customer, in such order and in such amounts as
WFBC in its sole discretion may determine from time to time.


 


3.10        Collected
Reserve Account and Reporting and Statement of Account.


 


(a)           After collection by WFBC of a
Purchased Account and the Related Rights with respect thereto, if any, WFBC
shall credit the Collected Reserve Account with the amount collected on such
Purchased Account and such Related Rights less: 
(i) the Purchase Price, and (ii) any fees, expenses or charges
owed to WFBC as more fully described herein. 
Any fee, charge or other obligation of the Customer under this Agreement
or any Related Document may be charged against the Collected Reserve Account in
WFBC’s sole discretion.  Provided no Event of Termination has occurred and
is continuing, or any event has occurred which with the passage of time or
notice would be an Event of Termination, each Wednesday that is a Business Day,
any available balance held in the Collected Reserve shall be released to the
Customer or to any third party, at the Customer’s written direction to
WFBC.  Upon the occurrence and during the
continuation of an Event of Termination, or the continuation of an event which
with the passage of time or notice would become an Event of Termination, WFBC
may hold any balance in the Collected Reserve Account as Collateral for any
obligations of the Customer to WFBC and WFBC may charge any such obligations
against the Collected Reserve Account in its sole discretion.


 


13

















 


(b)           On a weekly basis, or as otherwise
determined by WFBC at its sole discretion, WFBC shall prepare, and make
available to the Customer, an accounting of the purchases, collections, and
amounts credited to or charged against the Collected Reserve Account during
that week or other period.  Should such a statement of account indicate a
deficit balance, such balance shall be due and payable and the Customer shall
within three (3) Business Days pay to WFBC the amount of such deficit plus
accrued interest on such deficit balance.  Interest shall accrue on any
deficit balance at the annual rate of ten percent (10%), calculated on a daily
basis, not to exceed the applicable legal limit, from the date due until such
deficit is paid in full.


 


3.11        Termination
of this Agreement by Customer.  The
Customer may terminate this Agreement at any time if it (a) gives WFBC at
least thirty (30) days advance written notice prior to the proposed Termination
Date and (b) pays WFBC applicable termination fees in accordance with the
terms of this Agreement.  If the Customer
terminates this Agreement, on such Termination Date, (x) all amounts due
hereunder shall be immediately due and payable and (y) the Customer shall
repurchase all outstanding Purchased Accounts and the Related Rights with
respect thereto and immediately pay the Repurchase Price for such Purchased
Accounts and the Related Rights with respect thereto.


 


3.12        Sole
Property.  Once WFBC has
purchased an Account, any and all payments from whatever source as to such
Purchased Account are the sole property of WFBC.


 


3.13        Miscellaneous
Payments.  Should WFBC receive
a duplicate payment on a Purchased Account or other payment which is not
identified, WFBC shall carry these sums as open items in its accounting and
shall return any duplicate payment to the Account Debtor or apply such
unidentified payment pursuant to the terms hereof upon proper identification
and documentation.


 


3.14        Misdirected
Payments. 
With respect to misdirected payments, whenever any payment on any Purchased
Account comes into the Customer’s possession, the Customer shall hold such
payment in trust and safekeeping, as the property of WFBC, and immediately turn
over to WFBC such payment in the same form as it was received by the Customer
to WFBC. The Customer shall pay a misdirected payment fee in the amount of ten
percent (10%) of the amount of any payment on account of a Purchased Account
which has been received by the Customer and not delivered in kind to WFBC
within five (5) Business Days following the date of receipt by the
Customer.  Further, the Customer shall segregate and hold in trust and
safekeeping, as the property of WFBC, and immediately turn over to WFBC, any
goods or inventory returned to, reclaimed or repossessed by the Customer which
constitute Related Rights related to a Purchased Account.


 


3.15        Repayment
of Account Debtor.  In the
event WFBC is required to repay any Account Debtor for a payment received by
WFBC on an Account or Related Right, the amount of the repayment by WFBC shall
be an obligation of the Customer to WFBC whether or not this Agreement has been
terminated.  In the event the Customer
receives a payment from WFBC to which the Customer has no rights, repayment of
the funds to WFBC is an obligation of the Customer to WFBC whether or not this
Agreement has been terminated.  In either
event, if the obligation is not paid upon five (5) Business Days notice of
the obligation to pay from WFBC to the Customer, WFBC may file a financing
statement in connection with the security interest granted herein (if
necessary) or otherwise perfect its interest in the Collateral and exercise any



 


14

















 


and
all rights it has under this Agreement, any Related Document or otherwise to
collect the amounts due.


 


3.16        Hold
Harmless.  The Customer shall
hold WFBC harmless against any Account Debtor ill will arising from WFBC’s
collecting or attempting to collect on any Purchased Account and the Related
Rights with respect thereto, provided that WFBC acts in a commercially
reasonable manner.


 


3.17        Book
Entry.  The Customer shall,
immediately upon sale to WFBC of each Account and the Related Rights with
respect thereto, make proper entries on its books and records disclosing the
absolute sale of such Accounts to WFBC on said books and records and other
documents as so directed by WFBC.


 


3.18        Information.  In the event WFBC provides financial
information to the Customer regarding a third party, whether by setting a
Purchase Limit, at the request of the Customer or otherwise, the Customer
understands that WFBC is not making any representations or warranties or
expressing an opinion as to the creditworthiness of any such third party.


 


3.19        Payment
Terms.


 


(a)           All accrued and unpaid fees,
expenses, default interest, costs and any other amounts due from the Customer
shall be due and payable (i) on the date set forth herein or, if no date
is set forth herein, upon demand by WFBC, and (ii) on the Final
Termination Date.  Whenever any payment
to be made hereunder shall be stated to be due on a day which is not a Business
Day, such payment may be made on the next succeeding Business Day, and such
extension of time shall in such case be included in the computation of the
fees, expenses, interest, costs and any other amounts due hereunder, as the
case may be.


 


(b)           All amounts to be paid by or
deposited hereunder will be paid or deposited not later than 1:00 p.m.
(Denver, Colorado  time) on the day when due in same day
funds.  All computations of interest and
fees shall be calculated for the actual days elapsed based on a 360 day year.


 


(c)           Amounts due to WFBC hereunder shall
be remitted to WFBC in United States Dollars.


 


(d)           The Customer shall pay, as a full
recourse obligation, all fees, interest, costs and expenses, including all
amounts payable under Section 11.07.


 


(e)           The Customer will pay on demand to
WFBC interest (before and after default and before and after judgment, with
interest on overdue interest at the same rate) on all amounts not paid to or
deposited when due hereunder (other than amounts due under Section 3.10(b))
at a rate equal to LIBOR plus six and three quarters of one percent (6.75%)  per annum calculated daily.


 


(f)            The Customer will make all payments
required to be made by it hereunder without deduction or setoff regardless of
any defense or counterclaim.


 


15

















 


(g)           The Customer acknowledges that (i) WFBC
may maintain records of the Purchased Amount, all Purchased Accounts, all proceeds
of Collateral and all amounts paid by the Customer to WFBC hereunder, including
all fees, interest, costs and expenses; (ii) such records shall, absent
manifest error, be conclusive evidence thereof and (iii) the failure of
WFBC to maintain any such records shall not limit or otherwise affect the
obligations of the Customer or the rights and remedies of WFBC hereunder or
under any Related Document.


 


Article 4.

Conditions Precedent


 


4.01        Conditions
Precedent to Initial Purchase. 
Prior to the initial purchase hereunder, the Customer shall deliver to
WFBC, unless waived by it, the following documents, in form and substance
satisfactory to WFBC:


 


(a)           an executed copy of this Agreement;


 


(b)           (i) a certificate of an officer
of the Customer containing a copy of its certificate of formation and limited
liability company agreement, an appropriate resolution of its managers, and the
names and true signatures of the officers authorized to sign this Agreement and
the Related Documents on its behalf, and (ii) a certificate of an officer
of the Customer containing the names and true signatures of the officers
authorized to sign all reports and other submissions under this Agreement and
the Related Documents on its behalf, on which certificates WFBC shall be entitled
to conclusively rely until such time as WFBC receives from the Customer a
replacement certificate meeting the requirements of this Section 4.01(b)(i) or
(ii), as the case may be;


 


(c)           a certificate of status, good
standing or compliance in respect of the Customer issued by its jurisdiction of
incorporation and a certificate of status, good standing or compliance in
respect of the Customer issued by the appropriate authorities in each
jurisdiction in which the Customer is required to be registered in order to
conduct its business, except to the extent that failure to do so would not
reasonably be expected to have a Material Adverse Effect;


 


(d)           Certificates of Insurance required
under this Agreement, naming WFBC as a certificate holder;


 


(e)           executed copies of all discharges and
releases, if any, necessary to discharge or release all Liens and other rights
or interests of any Person in the Purchased Accounts, the Related Rights or the
Collateral previously granted by the Customer, other than Permitted Liens,
together with file stamped copies of the relevant UCC-3 financing statements;


 


(f)            current searches of appropriate
filing offices showing that (i) no Liens have been filed and remain in
effect against the Customer with respect to the Collateral except Permitted
Liens or Liens held by Persons who have agreed in writing that upon receipt of
proceeds of the initial purchase, they will satisfy, release or terminate such
Liens in a manner satisfactory to WFBC, and (ii) WFBC has duly filed all
financing statements necessary to perfect its Lien on the Purchased Accounts,
the Related Rights and the Collateral to the extent it is capable of being
perfected by filing, and such other similar instruments or documents as may be
necessary and, in 


 


16

















 


WFBC’s reasonable
discretion, advisable under any applicable statute to perfect, record or
protect WFBC’s interest in the Purchased Accounts, the Related Rights or the
Collateral;


 


(g)           payment of all fees due under the
terms of this Agreement through the date of the initial purchase and payment of
all expenses incurred by WFBC and through such date and that are required to be
paid by the Customer under this Agreement; and


 


(h)           such other approvals or documents as
WFBC in its sole discretion may require.


 


4.02        Conditions
Precedent to Subsequent Purchases. 
Each subsequent purchase of an Account and the Related Rights with
respect thereto shall be subject to the conditions precedent that, on the date
of such purchase before and after giving effect to such purchase, (a) the
Customer has delivered to WFBC an Assignment and Schedule of Accounts
acceptable to WFBC in its sole discretion which includes the Accounts to be
purchased, (b) the representations and warranties of the Customer
hereunder are correct on and as of the date of such purchase as though made on
and as of such date, except to the extent that such representations and
warranties relate solely to an earlier date and (c) no event has occurred
and is continuing, or would result from such purchase, which constitutes an
Event of Termination or would constitute an Event of Termination but for the
requirement that notice be given or time elapse or both.


 


Article 5.

The Customer’s Representations and Warranties


 


The Customer hereby represents and warrants to WFBC
as follows and any request by the Customer to sell, transfer and assign
Accounts to WFBC will be deemed a representation by the Customer that all
representations and warranties in this Article 5 are true, correct and
complete as of the time of the request, unless they relate exclusively to an
earlier date:


 


5.01        Existence
and Trade Names.  The Customer is duly organized, validly
existing and in good standing under the laws of its jurisdiction of
organization and is duly qualified to carry on business in each jurisdiction in
which the failure to be so qualified could reasonably be expected to have a
Material Adverse Effect, and the Customer’s trade name(s), all of which are
disclosed on the Customer’s application provided to WFBC, have been properly
filed and published as required by applicable law.


 


5.02        Corporate
Power and Authority.  The Customer has all requisite corporate
power and authority to execute and deliver, and to perform all of its
obligations under, this Agreement and all of the Related Documents to which it
is a party.


 


5.03        Corporate
Action.  The Customer has taken all necessary
corporate action to authorize the execution, delivery and performance of this
Agreement and all of the Related Documents to which it is a party.


 


5.04        Authorization.  The
execution, delivery and performance by the Customer of this Agreement and all
of the Related Documents to which it is a party have been duly authorized and
do not require the consent or approval of the Customer’s shareholders.


 


17

















 


5.05        Binding
Effect.  This Agreement and all of the Related
Documents to which it is a party have been duly executed and delivered by the
Customer and constitute the legally binding obligation of the Customer
enforceable against it in accordance with their terms, subject to applicable
bankruptcy, reorganization, insolvency, moratorium and other similar laws
affecting creditors’ rights generally and equitable principles of general
application (regardless of whether enforcement is sought in a proceeding at law
or in equity).


 


5.06        No
Contravention; No Consent Required.  The
Customer’s execution and delivery of this Agreement or any Related Document to
which it is a party and compliance with their respective terms and conditions
will not (a) result in a violation of the Customer’s [organizational
documents] or any resolutions passed by the Customer’s directors or
shareholders; (b) result in a violation of any applicable law, rule,
regulation, order, judgment, injunction, award or decree; (c) result in a
breach of, or constitute a default under, any loan agreement, indenture, trust
deed or any other agreement or instrument to which the Customer is a party or
by which it is bound which could reasonably be expected to have a Material
Adverse Effect; (d) require any approval or consent of, or any notice to
or filing with, any governmental authority or agency having jurisdiction except
such as has already been obtained, or (e) result in, or require, the creation
or imposition of any Lien (other than Permitted Liens) upon or with respect to
any of the Purchased Accounts, Related Rights or Collateral.


 


5.07        Chief
Executive Office.  The Customer’s chief executive office is at
the location(s) set out under the Customer’s name on the signature pages to
this Agreement.  All other places of
business have been disclosed on the application provided to WFBC.


 


5.08        Solvency
of the Customer.  The Customer is solvent and is not subject to
any Insolvency Proceeding.


 


5.09        Taxes.  The
Customer has made and shall continue to make timely payment and remittance to
applicable governmental authorities of all taxes and other amounts required to
be paid and remitted by the Customer pursuant to applicable law, except (a) for such taxes as may be contested by the Customer in
good faith and for which appropriate reserves have been established as
determined by WFBC in its sole discretion and (b) for taxes the
non-payment of which would not materially adversely affect the interest of WFBC
in the Purchased Accounts, the Related Rights or the Collateral or the
collectibility and enforceability of the Purchased Accounts, the Related Rights
or the Collateral or WFBC’s rights thereunder.


 


5.10        Good
Title; No Liens.  The Customer is, at the time of purchase of
each Account and the Related Rights with respect thereto by WFBC, the lawful
owner of and has good and undisputed title to such Account and the Related
Rights with respect thereto.  At the time
of purchase, each Account and the Related Rights with respect thereto are free
from any Liens other than Permitted Liens. 
To the Customer’s knowledge, each Account offered for sale, transfer and
assignment to WFBC is an Acceptable Account.


 


5.11        Solvency
of Account Debtors.  To the Customer’s knowledge, each Account
Debtor’s business is solvent at the time each Account of such Account Debtor
and the Related Rights with respect thereto are presented to WFBC for purchase.


 


18

















 


5.12        Accounts
Undisputed; Transferable.  Each Account or portion
thereof, as the case may be, offered for sale, transfer and assignment to WFBC (a) is
an accurate and undisputed statement of indebtedness owed by the applicable
Account Debtor to the Customer for a certain sum which is due and payable in
one hundred twenty (120) days or less, or within such term as is agreed to by
WFBC and the Customer, and (b) is for a bona fide sale, delivery and
acceptance of merchandise or performance of services which have been received
and finally accepted by such Account Debtor. 
The Customer has all rights to sell, transfer or assign such Accounts
and the Related Rights with respect thereto to WFBC and at the time of purchase
(and all other times unless the Customer gives WFBC written notice to the
contrary) such Accounts and the Related Rights with respect thereto are payable
by the applicable Account Debtor without offset, deduction or counterclaim.


 


5.13        No
Ownership; Control of Account Debtors.  The
Customer does not own, control or exercise dominion over, in any way
whatsoever, any Account Debtor or the business of any Account Debtor for whom
Accounts are to be, or have been, sold by the Customer to WFBC.


 


5.14        Accuracy
of Information.  All of the Records and all other records,
statements or books shown to WFBC by the Customer at anytime, either before or
after the signing of this Agreement, are true and accurate in all material
respects.


 


5.15        No
Actions; Suits.  There is no action, suit or proceeding at law
or in equity or by or before any governmental instrumentality or other agency
now pending, or to the knowledge of the Customer, threatened against or
affecting the Customer, which if adversely determined, would have a Material
Adverse Effect.


 


5.16        Material
Adverse Effect.  Since the date of Broadwind Energy’s most
recent audited financial statements, there has been no Material Adverse Effect.


 


Article 6.

The Customer’s Covenants


 


The Customer agrees as follows:


 


6.01        Compliance
with Governing Documents; Laws.  The
Customer will comply in all material respects with its [organizational
documents] and all applicable laws, rules, regulations and orders with respect
to it, its properties, and all Purchased Accounts and the Related Rights with
respect thereto, and will preserve and maintain its existence, rights,
franchises, qualifications, and privileges in the jurisdiction of its
organization, and qualify and remain qualified in good standing in each
jurisdiction where the failure to be so qualified could result in a Material
Adverse Effect.


 


6.02        Compliance
with Account Debtor Agreements.  The
Customer will, at its own expense, timely and fully perform and comply with all
material provisions, covenants and other promises required to be observed by it
under the agreements with its Account Debtors and under all other agreements related to any
Purchased Accounts or Related Rights, and timely and fully comply in all
material respects with the Credit and Collection Policy in regard to each
Purchased Account.  WFBC’s exercise of
any rights hereunder shall not relieve the Customer from such obligations.  The Customer will not make any change in the
character of its business that could 


 


19

















 


(a) result
in a Material Adverse Effect or (b) result in a Purchased Account becoming
an Unacceptable Account.  The Customer will not amend or otherwise modify in any material and
adverse manner the Credit and Collection Policy without giving notice to WFBC.


 


6.03        Ensure
Payment of Purchased Accounts; Defend WFBC Title.  The
Customer will (a) take all steps reasonably necessary or reasonably
requested by WFBC to (i) ensure payment of all Purchased Accounts and the
Related Rights with respect thereto by the Account Debtors and (ii) defend
the title of WFBC to each Purchased Account and the Related Rights with respect
thereto and the proceeds thereof against the claims of all other Persons and (b) consult
with WFBC with respect to any actions taken pursuant to clause (a) hereof.


 


6.04        Delivery
of Instruments, etc.  Upon request by WFBC after the
occurrence and during the continuation of an Event of Termination, the Customer
will promptly deliver to WFBC in pledge all instruments, documents and chattel
paper constituting Collateral or otherwise evidencing any Purchased Account or
the Related Rights with respect thereto, duly endorsed or assigned by the
Customer.


 


6.05        Payment
Instructions.  The Customer will not issue any payment
instructions to any Account Debtor other than in accordance with the terms of
this Agreement and the Related Documents. 
The Customer will not alter any electronic or other instruction, code or
password which could result in payment from an Account Debtor being made to any
Person other than WFBC.


 


6.06        Reporting
Requirements.  The Customer will provide to WFBC the
following:


 


(a)           as
soon as available and in any event within thirty (30) days after the end of
each month, year-to-date unaudited consolidated and consolidating financial
statements of Broadwind Energy and its Subsidiaries (which may be subject to
quarterly adjustments) including a statement of monthly income and a balance
sheet of Broadwind Energy and its Subsidiaries, certified by an authorized
officer of Broadwind Energy;


 


(b)           as
soon as available and in any event within  ninety
(90) days after Broadwind Energy’s fiscal year end, Broadwind Energy’s and its
Subsidiaries’ audited financial statements prepared by an independent certified
public accountant acceptable to WFBC, which shall include Broadwind Energy’s
and each of its Subsidiaries’ balance sheet, income statement, and statement of
retained earnings, prepared, if requested by WFBC, on a consolidated and
consolidating basis.  The annual
financial statements shall be accompanied by copies of all management letters
prepared by Broadwind Energy’s accountants;


 


(c)           promptly
upon discovery, written notice of any commercial tort claims brought by the
Customer against any Person with respect to a Purchased Account, any Related
Rights or any Collateral, including the name and address of each defendant, a
summary of the facts, an estimate of the Customer’s damages, copies of any
complaint or demand letter submitted by the Customer, and such other
information as WFBC may request; and


 


20






 


 












 


(d)           such
other information documents, records or reports in respect of the Purchased
Accounts, the Related Rights, the Collateral or the condition or operations,
financial or otherwise, of the Customer or any of its Subsidiaries as WFBC may
from time to time reasonably request.


 


6.07         Notation
on Invoices.  If an Event of Termination has occurred and
is continuing and at the request of WFBC, the Customer will immediately make a
notation on each original invoice (or the electronic equivalent of an invoice)
or other such documentation accepted by WFBC for each Purchased Account which
indicates that such Account has been sold, transferred and assigned to
WFBC.  Such notation shall read as
follows or as otherwise agreed to by WFBC in writing:


 


This invoice has been sold, transferred and assigned to


and is payable to:


WELLS FARGO BUSINESS CREDIT


Dept. 1494


Denver, Colorado  80291-1494


For information call 303/964-7400


 


Wire Instructions:


WELLS FARGO BANK, N.A.


San Francisco, CA


ABA# 121000248


Beneficiary:  Wells Fargo
Business Credit


Acct# 6355033300


 


In
addition, if an Event of Termination has occurred and is continuing and at the
request of WFBC, the Customer will immediately make a notation, in form and
substance acceptable to WFBC in its sole discretion, on any other form of
documentation accepted by WFBC for each Purchased Account and all Related
Rights which indicates that such Purchased Account and Related Rights have been
sold, transferred and assigned to WFBC.


 


6.08         Directions
to Account Debtors.  On or prior to the date hereof, the
Customer shall have given written directions to each Account Debtor to remit
all amounts due in respect of any Account to the address and the wiring
instructions set forth in Section 6.07. 
All items deposited in the deposit account set forth in Section 6.07
shall be subject to final payment.  If any such item is returned
uncollected, the Customer agrees to pay WFBC on demand the amount of that
item.  The Customer agrees to take any action reasonably requested by WFBC
to facilitate the foregoing.


 


6.09         No
Interference.  The Customer will not under any circumstances
or in any manner whatsoever, interfere with any of WFBC’s rights under this
Agreement.


 


6.10         No
Sale or Assignment.  For the duration of this Agreement and for
any period thereafter as long as any obligation to repurchase or indebtedness
under this Agreement remains owing by the Customer to WFBC, the Customer will
not sell, transfer or assign Acceptable Accounts or any Related Rights to any
party other than WFBC.


 


21

















 


6.11         Permitted
Liens.  The Customer shall not create, incur or suffer to
exist any Lien upon any of the Purchased Accounts, Related Rights or
Collateral, as security for any indebtedness, with the exception of the
following (each a “Permitted Lien”; collectively, “Permitted Liens”):  (a) Liens in existence on the date of
this Agreement that are described in Exhibit B; and (b) the Liens
created by this Agreement or any Related Document.


 


6.12         No
Modification of Invoices.  Without the prior written
consent of WFBC, the Customer will not change or modify the terms of the
original invoice with any Account Debtor or the order of payment on Accounts
sold to WFBC.


 


6.13         Material
Disputes.  The Customer will promptly (but in any event
within three (3) Business Days of obtaining knowledge thereof) notify WFBC
of (a) any material dispute between the Customer and an Account Debtor
that owes a Purchased Account in which ten percent (10%) of the invoiced amount
or more is in dispute, (b) the return or returns by an Account Debtor that
owes a Purchased Account or its Affiliates to the Customer of any product with
a fair market value equal to ten percent (10%) of the invoiced amount or more
in the aggregate at any one time or (c) any material claim, loss or offset
of any kind against the Customer or WFBC in excess of an amount equal to ten
percent (10%) or more of the invoiced amount asserted by an Account Debtor
owing a Purchased Account.  If there is
any material dispute between the Customer and an Account Debtor that previously
owed a Purchased Account, prior to presenting to WFBC for purchase hereunder
another Account owing by such Account Debtor, Customer shall notify WFBC of
such dispute.


 


6.14         Insurance.  The
Customer will maintain such insurance covering the Customer’s business or the
property of the Account Debtors as is customary and adequate for businesses
similar to the business of the Customer in an amount as is sufficient to
compensate for reasonably foreseeable loss, and promptly pay all premiums with
respect to the policies covering such insurance.


 


6.15         Chief
Executive Office; Location of Books and Records.  The
Customer will notify WFBC in writing prior to any change in the location of any
of its places of business or if the Customer has or intends to acquire any
additional place of business.  The
Customer will not change its chief executive office or the office or offices
where the Customer’s books and records concerning Purchased Accounts and the
Related Rights are kept without thirty (30) days’ prior written notice to
WFBC.  The Customer will not remove any
Collateral from the jurisdictions in which the Collateral is located on the
date of this Agreement without the prior written consent of WFBC.


 


6.16         Notification
of Changes; Additional Trade Names; Dissolution.  The
Customer will notify WFBC in writing at least thirty (30) days prior to any (a) proposed
change of the Customer’s legal name, jurisdiction of [incorporation], identity,
legal entity, or [corporate] structure, (b) business dissolution, or (c) use
of any additional trade name.  The
Customer will notify WFBC in writing within five (5) Business Days after
an officer of the Customer or any Subsidiary becomes the direct or indirect
owner of twenty five percent (25%) or more of the equity interests in the
Customer.


 


22

















 


6.17         Notification
of Legal Proceedings. 
No later than three (3) Business Days after discovery, the Customer will
notify WFBC in writing of (a) any litigation or other proceeding
before any court or governmental agency which seeks a monetary recovery against
the Customer in excess of $250,000
or (b) any Insolvency Proceeding against the Customer.


 


6.18         USA
PATRIOT Act.  The Customer will (i) ensure, and cause
each Subsidiary to ensure, that no equity owner shall be listed on the
Specially Designated Nationals and Blocked Person List or other similar lists
maintained by the Office of Foreign Assets Control, the Department of the
Treasury or included in any Executive Orders, (ii) not use or permit the
use of the proceeds of this Agreement or any other financial accommodation from
WFBC to violate any of the foreign asset control regulations of the Office of
Foreign Assets Control or other applicable law, (iii) comply, and cause
each Subsidiary to comply, with all applicable Bank Secrecy Act laws and
regulations, as amended from time to time, and (iv) otherwise comply with
the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)) as required by federal law and WFBC’s policies and practices.


 


6.19         Minimum
Cash Reserves.  The Customer and its Affiliates will maintain, as of the end of each
month and each fiscal year as reflected on reports provided to WFBC under Section 6.06(a) and
(b), cash reserves or investments in cash equivalents and/or short-term
investments in an amount of not less than the lesser of (a) Five Million
and No/100 Dollars ($5,000,000.00) or (b) the sum of Purchased Accounts
plus available Acceptable Accounts.


 


Article 7.

Security Interest


 


7.01         Security
Interest/Collateral.  As
further inducement for WFBC to enter into this Agreement, the Customer hereby
pledges, assigns and grants to WFBC a Lien and security interest in the
Collateral as security for the payment and performance of any and all
obligations and liabilities whatsoever of the Customer to WFBC under this
Agreement or any Related Document. 
Following request by WFBC, the Customer shall grant WFBC a Lien and security
interest in all Collateral consisting of commercial tort claims that it may
have against any Person.


 


7.02         Security
Documents.  The Customer
authorizes WFBC, at the Customer’s expense, to file financing statements
describing the Purchased Accounts, the Related Rights and the Collateral to perfect
WFBC’s Lien in the Purchased Accounts, the Related Rights and the Collateral,
and WFBC may describe the Collateral as set forth in Section 2.15 of this
Agreement or describe specific items of Collateral, including commercial tort
claims, as WFBC may consider necessary or useful to perfect WFBC’s Lien in the
Purchased Accounts, the Related Rights and the Collateral.  All such financing statements filed before
the date of this Agreement to perfect such Lien were authorized by the
Customer.  Following the Final
Termination Date, WFBC will, at the Customer’s expense and within the time
periods required under applicable law, release or terminate any and all filings
or other agreements that perfect its Liens in the Purchased Accounts, the
Related Rights and the Collateral.


 


23

















 


Article 8.


Operational
Provisions


 


8.01         Power
of Attorney.  In order to carry out this
Agreement, the Customer irrevocably appoints WFBC, its successors and each
assignee, and any Person designated by WFBC, its successors or such assignees
(which appointment is coupled with an interest) as its attorney in fact, with
right of substitution, to:


 


(a)           in order to evidence or protect WFBC’s
interest in the Purchased Accounts, the Related Rights and the Collateral,
execute and file, in the Customer’s name and on the Customer’s behalf, such
recording, financing or similar statements (including any amendments, renewals
and continuation statements) under applicable laws in such jurisdictions where it
may be necessary to validate, perfect or protect WFBC’s interest in any of the
Purchased Accounts, the Related Rights and the Collateral;


 


(b)           upon the occurrence and during the
continuation of an Event of Termination,  strike
through the Customer’s remittance information on all invoices delivered to
Account Debtors and note WFBC’s remittance information on all invoices;


 


(c)           upon the occurrence and during the
continuation of an Event of Termination,  at
the expense of the Customer, notify, or cause the Customer to notify, any
Account Debtor or other Person obligated to pay a Purchased Account that such
right to payment has been sold, transferred and assigned to WFBC and instruct,
or cause the Customer to instruct, any Account Debtor or other Person to (i) make
and remit payments due under the Accounts and any Related Rights directly to
the address or wiring instructions set forth in Section 6.07 or (ii) deliver
payments due under the Accounts and any Related Rights to WFBC by wire
transfer, ACH, or other means as WFBC may direct, in each case for deposit to
the Collected Reserve Account or for direct application to the amounts due and
owing to WFBC;


 


(d)           upon the occurrence and during the
continuation of an Event of Termination, at any time after the Customer or WFBC
gives notice as set forth in Section 8.01(c) to an Account Debtor or
other obligor and with or without notice to the Customer, in WFBC’s name or in
the Customer’s name, (a) demand, sue for, file any claims or take any
action or institute any proceedings for, collect, give releases for or receive
any money or property at any time payable or receivable on account of or
securing, any such right to payment, or (b) grant any extension to, make
any compromise or settlement with or otherwise agree to waive, modify, amend or
change the obligations (including collateral obligations) of any such Account
Debtor or other obligor;


 


(e)           endorse the name of the Customer or
the Customer’s trade names on any checks or other evidences of payment that may
come into the possession of WFBC with respect to any Purchased Account, or on
any other documents relating to any of the Purchased Accounts, the Related
Rights or the Collateral;


 


(f)            process any payments received
directly by WFBC on a Purchased Account or any Related Rights either by
delivery to the address or wiring instructions set forth in Section 6.07
if WFBC so directs or by direct collection and subsequent crediting of the
Collected Reserve 


 


24

















 


Account, and individually
deliver any other payment for the benefit of the Customer directly to the
Customer in the form received in accordance with this Agreement;


 


(g)           upon the occurrence and during the
continuation of an Event of Termination, compromise, prosecute, or defend any
action, claim or proceeding as to any Purchased Account, any Related Right or
any Collateral;


 


(h)           upon the occurrence and during the
continuation of an Event of Termination, offer a trade discount to any Account
Debtor exclusive of the Customer’s normal business custom with such Account
Debtor;


 


(i)            upon the occurrence and during the
continuation of an Event of Termination, initiate electronic debit or credit
entries through the ACH system to or from the account described in Section 6.07
or any deposit account maintained by the Customer in which proceeds of the
Collateral are deposited;


 


(j)            upon the occurrence and during the
continuation of an Event of Termination,  sign
the Customer’s name on any notice of assignment or on any notices to Account Debtors;


 


(k)           take any other actions WFBC deems
necessary or advisable to collect, endorse, negotiate or otherwise realize on
the Purchased Accounts, the Related Rights, the Collateral or any part thereof,
any negotiable instrument, or other right of any kind, held or owned by the
Customer and sold, transferred, assigned or delivered to or received by WFBC as
payment on account or otherwise in respect of any of the Purchased Accounts,
the Related Rights or the Collateral; and


 


(l)            take any and all actions required
(as determined by WFBC in its sole discretion) to enforce WFBC’s rights and
remedies hereunder or under any Related Document and to otherwise carry out the
purposes of this Agreement or any Related Document, including exercising any of
the remedies set forth in this Agreement or any Related Document.


 


The
authority granted to WFBC under this Section 8.01 shall remain in full
force and effect until the payment in full of all amounts due and owing to
WFBC, the satisfaction of all obligations of the Customer to WFBC hereunder and
under each Related Document and termination of all obligations of WFBC
hereunder and under each Related Document. 
WFBC’s performance of such actions shall be taken or not taken in its
sole discretion and shall not relieve the Customer from any obligation or cure
any default under this Agreement or any Related Document.  The powers of attorney described in this Section 8.01
are coupled with an interest and are irrevocable, shall survive the Customer’s
dissolution and shall not be affected by the Customer’s insolvency or
bankruptcy in any manner.


 


8.02         Certifications.  The Secretary or Assistant Secretary
of the Customer shall certify to WFBC the names and signatures of the persons
who, on the date hereof, are duly elected, qualified and acting as the officers
or agents referred to in the resolutions adopted by the Customer with respect
to this Agreement, and the Secretary or Assistant Secretary shall from time to
time hereafter, upon a change in the facts so certified, certify to WFBC the
names and signatures of the persons then authorized to sign or to act within
three Business Days after any such change.  WFBC shall be fully protected
in relying on such certificates and on the obligation 


 


25

















 


of
the Secretary or Assistant Secretary of the Customer to certify to WFBC any
change in any facts so certified.  At all times, there shall be at least
two officers or agents authorized to sign or to act under this Agreement and
the Related Documents on behalf of the Customer, and the Customer shall have
delivered to WFBC certificates containing the names and true signatures of each
such agent and officer, on which certificates WFBC shall be entitled to
conclusively rely.


 


8.03         License.  The
Customer hereby grants to WFBC (but only to the extent of the license rights
the Customer possesses) a non exclusive, worldwide and royalty free license to
use or otherwise exploit all intellectual property rights of the Customer
(whether owned or licensed) for the purpose of collecting the Purchased
Accounts and selling, leasing or otherwise disposing of any or all Related
Rights and Collateral during the existence of an Event of Termination.


 


8.04         Reports.  In the event the Customer requests
information from WFBC regarding the Customer’s account hereunder, such requests
shall be subject to the schedule of fees provided by WFBC which schedule may be
adjusted by WFBC from time to time in its discretion.


 


8.05         Account
Verification.  WFBC or its agent may, at any time and from
time to time, send or require the Customer to send requests for verification of
Purchased Accounts (including amounts owed to the Customer) to Account Debtors
and other obligors or, so long as an Event of Termination has occurred and is
continuing, notices of assignment to Account Debtors and other obligors.


 


8.06         Books
and Records; Collateral Examination; Inspection; Premises.  The
Customer shall hold the Records in trust for WFBC and keep complete and
accurate books and records with respect to the Purchased Accounts, the Related
Rights and the Collateral and the Customer’s business and financial condition
and any other matters that WFBC may request, in accordance with generally
accepted accounting principles.  The
Customer shall permit any employee, attorney, accountant or other agent of WFBC
to examine and inspect the Related Rights and the Collateral and any property
of the Customer related to the Purchased Accounts, the Related Rights or the
Collateral and to audit, review, make extracts from and copy any of its books
and records (a) at any time during ordinary business hours as long as no
Event of Termination has occurred and is continuing and (b) at any time
during the continuation of an Event of Termination, and to discuss the Customer’s
affairs with any of its directors, managers, officers, employees, owners or
agents.  The Customer authorizes all
accountants and other Persons acting as its agent to disclose and deliver to
WFBC’s employees, accountants, attorneys and other Persons acting as its agent,
at the Customer’s expense, all financial information, books and records, work
papers, management reports and other information in their possession regarding
the Customer.  If WFBC occupies or uses
the premises of the Customer hereunder, WFBC shall not be obligated to pay or
account for any rent or other compensation for such occupancy or use; provided,
however, that if WFBC does pay or account for any rent or other compensation
for such occupancy or use, the Customer shall reimburse WFBC on demand for
the full amount thereof.


 


8.07         Duty
of Care and Related Matters.  WFBC’s
duty of care with respect to any Purchased Accounts, Related Rights or
Collateral in its possession (as imposed by law) will be deemed fulfilled if it
exercises reasonable care in physically keeping such Purchased Accounts,
Related Rights, or Collateral or in the case of Related Rights and Collateral
in the custody or 


 


26

















 


possession
of a bailee or other third Person, exercises reasonable care in the selection
of the bailee or third Person, and WFBC need not otherwise preserve, protect,
insure or care for such Purchased Accounts, Related Rights or Collateral.  WFBC shall not be obligated to preserve
rights the Customer may have against prior parties, to liquidate the Purchased
Accounts, the Related Rights and the Collateral at all or in any particular
manner or order or apply the proceeds of the Purchased Accounts, the Related
Rights and the Collateral in any particular order of application.  WFBC has no obligation to clean up or prepare
Collateral for sale.  The Customer waives
any right it may have to require WFBC to pursue any third Person for any amounts
payable to WFBC by the Customer.


 


8.08         Notice
of Assignment to Account Debtor.  The
Customer shall label its records in a manner reasonably acceptable to give
proper notice of the sale, transfer and assignment of the Purchased Accounts
and Related Rights to WFBC.  Nothing in
this Section 8.08 shall however require the Customer, nor permit WFBC, to
deliver notice of the sale, transfer or assignment of a Purchased Account and
the Related Rights with respect thereto to the applicable Account Debtor unless
an Event of Termination has occurred and is continuing.  Except as otherwise permitted hereunder or
under any Related Document, WFBC shall not reveal any sale, transfer and
assignment of a Purchased Account or the Related Rights with respect thereto to
the applicable Account Debtor without the Customer’s consent, unless an Event
of Termination has occurred and is continuing, or, after notice to the
Customer, in order to comply with applicable law.


 


Article 9.

Events of Termination


 


9.01         Events
of Termination.  Any one or more of the following shall be an
Event of Termination hereunder (each, an “Event of Termination”):


 


(a)           The Customer shall fail to pay any
indebtedness to WFBC within three (3) Business Days after the same becomes
due or repurchase any Purchased Account within three (3) Business Days
after required hereunder.


 


(b)           The Customer shall breach (i) any
term, provision, promise or covenant under this Agreement or any Related
Document or (ii) any material term, provision, promise or covenant under
any other agreements or contracts between the Customer and WFBC, subject to any
applicable cure or grace period therein, if any.


 


(c)           Any representation, warranty,
certification or statement made, or deemed made by the Customer in, or pursuant
to, this Agreement, any Related Document or any other agreements or contracts,
between the Customer and WFBC proves to have been incorrect or misleading in
any material respect when made or deemed made.


 


(d)           The Customer shall become insolvent
or unable to pay debts as they mature; the Customer shall make a general
assignment for the benefit of creditors or voluntarily commence any Insolvency
Proceeding affecting the Customer; any involuntary Insolvency Proceeding shall
be filed against the Customer and is not dismissed within
sixty (60) days; or any proceeding
shall be instituted seeking the entry of an order for relief by the appointment
of a receiver, trustee, custodian or similar official for the Customer or a
substantial part of its property.


 


27

















 


(e)           The Customer shall create, incur or
suffer to exist any Lien upon any Purchased Account, Related Rights or
Collateral (other than a Permitted Lien) or any levies, attachment, executions,
or similar process shall be issued against any Purchased Account, Related
Rights or Collateral.


 


(f)            Any financial statements, profit and
loss statements, or schedules, other statements, information or documents
furnished by the Customer to WFBC are incorrect or misleading in any material
respect.


 


(g)           (i) Any document or other
information submitted by the Customer to WFBC for the purchase of an Account is
fraudulent or erroneous (subject to adjustments allowed hereunder), or (ii) the
Customer fails to submit within three (3) Business Days after notice from
WFBC to Customer any document or other information required by WFBC under this
Agreement for the purchase of an Account.


 


(h)           Any Account Debtor shall assert a
claim or offset of any kind against the Customer or WFBC which may have a
material adverse impact on payment of any Purchased Account or on any Related
Rights and the Customer fails to resolve such claim or offset within ten (10) Business
Days thereafter.


 


(i)            A Change of Control shall occur.


 


(j)            An Event of Termination (as defined
in any Affiliate Account Purchase Agreement) shall occur and be continuing under
any Affiliate Account Purchase Agreement.


 


(k)           Any Guarantor of the Customer’s
obligations hereunder is in default under its Guaranty or any Guarantor
withdraws, disaffirms or revokes its Guaranty.


 


(l)            (i) The Customer, directly or
indirectly, disaffirms or contests in writing the validity or enforceability of
this Agreement or any Related Document or (ii) this Agreement or any
Related Document fails to be the enforceable obligation of the Customer.


 


(m)          One or more judgments or decrees shall
be entered against the Customer involving in the aggregate at any time a
liability (net of any insurance or indemnity payments actually received in
respect thereof prior to or within sixty (60) days from the entry thereof, or
to be received in respect thereof in the event any appeal thereof shall be
unsuccessful) equal to or in excess of $250,000 at the time of the entry of the
most recent of each such judgment or decree until such judgments or decrees
have been vacated, discharged, stayed or bonded pending appeal; and all such
judgments or decrees shall not have been vacated, discharged, stayed or bonded
pending appeal within sixty (60) days from the entry thereof.


 


(n)           (i) Any Person shall engage in
any “prohibited transaction” (as defined in Section 406 of ERISA or Section 4975
of the Code) involving any Plan, (ii) any “accumulated funding deficiency”
(as defined in Section 302 of ERISA), whether or not waived, shall exist
with respect to any Plan or any Lien in favor of the PBGC or a Plan shall arise
on the assets of the Customer or any Subsidiary, (iii) a Reportable Event
shall occur with respect to, or proceedings shall commence to have a trustee
appointed, or a trustee shall be appointed, to administer or to terminate, any
Single Employer Plan, which Reportable Event or 


 


28

















 


commencement of
proceedings or appointment of a trustee is reasonably likely to result in the
termination of such Plan for purposes of Title IV of ERISA (other than a
standard termination pursuant to Section 4041(b) of ERISA), (iv) any
Single Employer Plan shall terminate for purposes of Title IV of ERISA (other
than a standard termination pursuant to Section 4041(b) of ERISA), (v) any
of the Customer or any Subsidiary shall, or is reasonably likely to, incur any
liability in connection with a withdrawal from, or the Insolvency or
Reorganization of, a Multiemployer Plan, (vi) the occurrence or expected
occurrence of any event or condition which results or is reasonably likely to
result in any of the Customer’s or any Subsidiary’s becoming responsible for
any liability in respect of a Former Plan (other than a standard termination
pursuant to Section 4041(b) of ERISA), or (vii) any other event
or condition shall occur or exist with respect to a Plan; and in each case in
clauses (i) through (vii) above, such event or condition, together
with all other such events or conditions, if any, would be reasonably expected
to result in liability which would have a Material Adverse Effect.


 


Article 10.

Remedies


 


10.01       Remedies.  Upon the occurrence of an Event of
Termination, WFBC may do any one or more of the following:


 


(a)           Accelerate and declare immediately
due and payable, and charge back, all indebtedness of the Customer to WFBC,
whether mature, contingent or otherwise, whereupon all such amounts shall
become and be forthwith due and payable, without presentment, notice of
dishonor, protest or further notice of any kind, all of which the Customer
hereby expressly waives.


 


(b)           Require the Customer to repurchase
any and all Purchased Accounts, including the Related Rights with respect
thereto, whether disputed or undisputed, and to pay on demand the Repurchase
Price for those Purchased Accounts, including such Related Rights, as provided
herein, and, in the event the Repurchase Price is not paid in full on demand,
WFBC or its designee may collect such Purchased Accounts and charge a
reasonable fee in connection with such collection activities in addition to any
other fees or charges provided for herein.


 


(c)           Cease purchasing any Account under
this Agreement.


 


(d)           Notify, or cause the Customer to
notify, any Account Debtor or other Person obligated to pay a Purchased Account
that such right to payment has been sold, transferred and assigned to WFBC and
instruct, or cause the Customer to instruct, any Account Debtor or other Person
to (i) make and remit payments due under the Purchased Accounts and any
Related Rights directly to the address or wiring instructions set forth in Section 6.07
or (ii) deliver payments due under the Purchased Accounts and any Related
Rights to WFBC by wire transfer, ACH, or other means as WFBC may direct, in
each case for deposit to the Collected Reserve Account or for direct
application to the amounts due and owing to WFBC.


 


(e)           Take possession of any Related Rights
or Collateral, with or without judicial process.


 


29

















 


(f)            Settle any disputed Purchased
Account directly with the Account Debtor for any amount without relieving the
Customer of its obligations with respect to such Purchased Account under this
Agreement, grant extensions and compromise claims, all without prior notice to,
or consent of, Customer.


 


(g)           Require the Customer to assemble the
Related Rights and the Collateral and make them available to WFBC at a place
designated by WFBC.


 


(h)           Enter the Customer’s premises, take
possession of the Related Rights and Collateral, and use such premises (at no
cost to WFBC) only to hold, process, sell, use, store, liquidate, realize upon
or otherwise dispose of items that are Purchased Accounts, Related Rights or
Collateral and for other purposes that WFBC may in good faith deem to be
related or incidental purposes.


 


(i)            Use, solely in connection with any
assembly, disposition or collection of the Purchased Accounts, the Related
Rights or the Collateral, any trademark, trade name, trade style, copyright,
patent right or technical process used or utilized by the Customer in
generating such Purchased Accounts or with respect to such Related Rights or
Collateral.


 


(j)            Initiate electronic credit or debit
entries through the ACH system to and from the account described in Section 6.07
or any deposit account maintained by the Customer wherever located.


 


(k)           Collect from the Customer all amounts
due and owing to WFBC in connection with this Agreement or any Related
Document.


 


(l)            Hold the Customer liable for any
deficiency for any amounts due and owing to WFBC.


 


(m)          Cease making reports or accountings to
the Customer as otherwise required by this Agreement.


 


(n)           Exercise and enforce any and all
rights and remedies available upon default to a secured party under the Uniform
Commercial Code, including the right to take possession of the Purchased
Accounts, the Related Rights and the Collateral, or any evidence thereof,
proceeding without judicial process or by judicial process (without a prior
hearing or notice thereof, which the Customer hereby expressly waives) and the
right to sell, lease or otherwise dispose of any or all of the Purchased
Accounts, Related Rights and Collateral (with or without giving any warranties
as to the Purchased Accounts, Related Rights or Collateral, title to the
Purchased Accounts, Related Rights or Collateral or similar warranties).


 


(o)           Require the Customer to hold all
proceeds of Collateral separate and apart from its general funds in a
segregated trust account for the benefit of WFBC, to invest all such proceeds
so held as directed by WFBC and to remit such amounts so held together with any
interest thereon as directed by WFBC.


 


(p)           Without regard to any waste, adequacy
of the security or solvency of the Customer, apply for the appointment of a
receiver of the Collateral, to which appointment the 


 


30

















 


Customer hereby consents, whether
or not foreclosure proceedings have been commenced and whether or not a
foreclosure sale has occurred.


 


(q)           Exercise any other rights and
remedies available to the Customer with respect to the Purchased Accounts, the
Related Rights or the Collateral.


 


(r)            Exercise any other rights and
remedies available to it by law or agreement.


 


Notwithstanding
the foregoing, upon the occurrence of an Event of Termination described in Section 9.01(d),
amounts payable by the Customer to WFBC shall be immediately due and payable
automatically without presentment, demand, protest or notice of any kind.


 


10.02       Sale
of Collateral.  During the continuation of an Event of
Termination, if WFBC sells any of the Collateral on credit, the amounts payable
to WFBC hereunder will be reduced only to the extent of payments actually
received.  If the purchaser fails to pay
for any Collateral, WFBC may resell such Collateral and shall apply any
proceeds actually received to the amounts payable by the Customer to WFBC.


 


10.03       Certain
Notices.  During the continuation of an Event of
Termination, if notice to the Customer of any intended disposition of Purchased
Accounts, Related Rights or Collateral or any other intended action is required
by law in a particular instance, such notice shall be deemed commercially
reasonable if given (in the manner specified in Section 11.18) at least
ten (10) calendar days before the date of intended disposition or other
action.


 


Article 11.

Miscellaneous Provisions


 


11.01       Binding
on Future Parties.  This
Agreement inures to the benefit of and is binding upon the successors and
assigns of the parties hereto; provided, however, that the Customer shall not
assign its rights hereunder or any interest herein without WFBC’s prior written
consent which may be withheld in its sole discretion; and, provided further,
however, that (i) so long as no Event of Termination shall have occurred
and be continuing, and except in the case of WFBC being merged into another
entity or a sale of all or substantially all of WFBC’s assets, WFBC shall not
assign its rights hereunder or any interest herein with the Customer’s prior
written consent which consent shall not be unreasonably withheld or delayed,
and (ii) in no event shall WFBC assign its rights hereunder or any
interest herein to a competitor of the Customer.


 


11.02       Participations.  WFBC may sell to one or more Persons (other
than a competitor of the Customer) (each a “Participant”) participating
interests in the interests of WFBC hereunder. 
WFBC shall remain solely responsible for performing its obligations
hereunder, and the Customer shall continue to deal solely and directly with
WFBC in connection with WFBC’s rights and obligations hereunder.  Each Participant shall be entitled to the
benefits of Section 11.07 and shall have the right of setoff through its
participation in amounts owing hereunder to the same extent as if it were WFBC.


 


11.03       Cumulative
Rights.  No failure or delay
by WFBC in exercising any right, power or remedy under this Agreement, any
Related Document or any Related Right shall operate as a waiver thereof; nor
shall any single or partial exercise of any such right, power or remedy 


 


31

















 


preclude
any other or further exercise thereof or the exercise of any other right, power
or remedy under this Agreement, any Related Document or any Related Right.  The remedies provided herein are cumulative
and not exclusive of any remedies provided by law.


 


11.04       Setoff.  WFBC may, at any time and from time to time,
in its sole discretion and without demand or notice to anyone, setoff any
liability owed to the Customer by WFBC against any amounts payable to WFBC by
the Customer, whether or not due.


 


11.05       Waiver.  WFBC may not waive its rights and remedies
unless the waiver is in writing and signed by WFBC.  A waiver by WFBC of a right or remedy under
this Agreement on one occasion is not a waiver of the right or remedy on any
subsequent occasion.


 


11.06       Failure
to Perform.  If the Customer
fails to perform any of its agreements or obligations hereunder or under any
Related Document or any Related Right, WFBC may (but will not be required to)
itself perform, or cause to be performed, such agreement or obligation.


 


11.07       Indemnity.


 


(a)           In addition to the payment of expenses
pursuant to Section 11.19, the Customer shall indemnify, defend and hold
harmless WFBC, and any of its participants, parent entities, subsidiary
entities, affiliated entities, successor entities, and all present and future
officers, directors, employees, attorneys and agents of the foregoing (the “Indemnitees”)
from and against any and all liabilities (other than tax liabilities subject to
Section 11.20), losses, damages, penalties, judgments, suits, claims,
costs and expenses of any kind or nature whatsoever (including the reasonable
fees and disbursements of counsel) arising out of or otherwise relating to this
Agreement, any Related Document, the transactions contemplated hereby and
thereby, any Purchased Account, any Related Rights, any Collateral, any action
taken or omitted by any of the Indemnitees, any actions to be performed by the
Customer hereunder or otherwise, or in connection with any of the foregoing,
any investigative, administrative or judicial proceedings, whether or not such
Indemnitee shall be designated a party thereto, which may be imposed on,
incurred by or asserted against any such Indemnitee, the purchase of Accounts,
the use or intended use of the proceeds of the payments made to the Customer,
or any of the following (collectively, “Indemnified Liabilities”):


 


(i)            any representation or warranty made
or deemed to be made by the Customer (or any of the Customer’s officers) in or
in connection with this Agreement or any Related Document, which was incorrect
in any material respect when made or deemed made or delivered;


 


(ii)           the failure of the Customer to
perform or observe any of its covenants, duties or obligations hereunder or
under any of the Related Documents;


 


(iii)          the failure by the Customer to comply
with any applicable law, rule, regulation, order, injunction, award or decree
with respect to any Purchased Account or Related Rights or the nonconformity
thereof with any applicable law, rule, regulation, order, injunction, award or
decree;


 


32






 


 












 


(iv)          the return or transfer by WFBC to the Customer of any payments received
by WFBC pursuant hereto to which WFBC is entitled pursuant to the terms of this
Agreement;


 


(v)           any loss of a perfected Lien or ownership interest (or in the priority of
such Lien or ownership interest) as a result of any commingling by the Customer
of funds to which WFBC is entitled hereunder with any other funds;


 


(vi)          any dilution, claims, disputes, damages, offsets, penalties, losses or
defenses arising from any Purchased Account or Related Rights or any claims,
disputes, offsets or defenses in connection with any merchandise or services
which are the subject of the Related Rights, including any product liability
claim or personal injury or property damage suit (provided, however, that
nothing contained in this subsection shall limit the liability of the Customer
or limit the recourse of WFBC to the Customer for any amounts otherwise
specifically provided to be paid by the Customer hereunder);


 


(vii)         any
failure of (a) any agreement with an Account Debtor to contain an
enforceable right of assignment and an express right to make information of
such Account Debtor available to the Customer’s assignees and their agents; and
(b) the Customer to bring such rights to the attention of the related
Account Debtor in compliance with applicable law; and


 


(viii)        any
claims, demands, expenses, loss or damage resulting from or growing out of
honoring or relying on the signature or other authority (whether or not
properly used) of any officer or person whose name and signature was certified
pursuant to Section 8.02, or refusing to honor any signature or authority
not so certified.


 


Notwithstanding
the foregoing, the Customer shall not be obligated to indemnify any Indemnitee
for (A) any Indemnified Liability caused directly by the gross negligence
or willful misconduct of such Indemnitee or (B) any overall net income
taxes imposed on such Indemnitee by the jurisdiction under the law of which
such Indemnitee is organized or otherwise considered doing business or any
political subdivision thereof.


 


(b)           If any investigative, judicial or administrative proceeding arising from
any of the foregoing is brought against any Indemnitee, upon such Indemnitee’s
request, the Customer and counsel, designated by the Customer and satisfactory
to the Indemnitee, will resist and defend such action, suit or proceeding to
the extent and in the manner directed by the Indemnitee, at the Customer’s cost
and expense.  Each Indemnitee will use
commercially reasonable efforts to cooperate in the defense of any such action,
suit or proceeding.  If the foregoing
undertaking to indemnify, defend and hold harmless may be held to be
unenforceable because it violates any law or public policy, the Customer shall
nevertheless make the maximum contribution to the payment and satisfaction of
each of the Indemnified Liabilities which is permissible under applicable law.


 


(c)           The obligations of the Customer under this Section 11.07 shall
survive the termination of this Agreement and the discharge of the other
obligations of the Customer hereunder.


 


11.08       Increased Cost and Reduced Return.  If the
adoption of any applicable law, rule or regulation, or any change therein,
or any change in the interpretation or administration thereof by 


 


33

















 


any
governmental authority charged with the interpretation or administration
thereof, or compliance by WFBC with any request or directive (whether or not
having the force of law) of any such governmental authority, in each case
occurring after the date of this Agreement, (a) subjects WFBC to any
charge or withholding on or in connection with this Agreement or any Related
Document or any Purchased Account, (b) changes the basis of taxation of
payments to WFBC in respect of any amounts payable under this Agreement or any
Related Document (except for changes in the rate of tax on the overall net
income before tax of WFBC), (c) imposes, modifies or deems applicable any
reserve, assessment, insurance charge, special deposit or similar requirement
against assets of, deposits with or for the account of, or any credit extended
by WFBC, (d) has the effect of reducing the rate of return on WFBC’s
capital to a level below that which WFBC could have achieved but for such
adoption, change or compliance (taking into consideration WFBC’s policies
concerning capital adequacy) or (e) imposes any other condition, and the
result of any of the foregoing is (x) to impose a cost on, or increase the
cost to WFBC of its purchasing, maintaining or funding any interest acquired
under this Agreement or any Related Document, (y) to reduce the amount of
any sum received or receivable by, or to reduce the rate of return of WFBC
under this Agreement or any related transaction document or (z) to require
any payment calculated by reference to the amounts received by it hereunder,
then, upon demand by WFBC, the Customer shall pay to WFBC (with respect to
amounts owed to it) such additional amounts as will compensate WFBC for such
increased cost or reduction.  For
avoidance of doubt, any interpretation of Accounting Research Bulletin No. 51
by the Financial Accounting Standards Board shall constitute an adoption,
change, request or directive subject to this Section 11.08.  If WFBC makes any demand under this Section 11.08,
the Customer shall have the right to terminate this Agreement within sixty (60)
days of the date on which such demand is made without incurring any termination
fee and without any other penalty or premium.


 


11.09       Choice of Law.  This
Agreement shall be governed by and construed in accordance with the substantive
laws (other than conflict laws) of the State of Colorado.


 


11.10       Invalid Provisions.  Any
provision of this Agreement which is prohibited or unenforceable shall be ineffective
to the extent of such prohibition or unenforceability without invalidating the
remaining provisions hereof.


 


11.11       Entire Agreement.  This
Agreement, including all Exhibits hereto, together with the Related Documents,
or any other document or agreement described in or related to this Agreement,
comprises the complete and integrated agreement of the parties on the subject
matter of this Agreement and supersedes all prior agreements, whether oral or
in writing.  All Exhibits hereto are
incorporated into this Agreement and made a part hereof.


 


11.12       Amendment.  Except as
otherwise provided herein, any amendment, addendum or modification hereto must
be signed by both parties.


 


11.13       Further Documents.  The
Customer, at its expense, will from time to time execute, deliver, endorse and
authorize the filing of any instruments, documents, conveyances, assignments,
security agreements, financing statements, control agreements and other
agreements that WFBC may reasonably request in order to secure, protect, perfect
or enforce WFBC’s rights under this Agreement, the Related Documents, the
Related Rights or any other 


 


34

















 


document
or agreement described in or related to this Agreement or its Lien in the
Purchased Accounts, Related Rights and Collateral (but any failure to request
or assure that the Customer executes, delivers, endorses or authorizes the
filing of any such item shall not affect or impair the validity, sufficiency or
enforceability of this Agreement, the Related Documents, the Related Rights or
any other document or agreement described in or related to this Agreement or
WFBC’s Lien in the Purchased Accounts, Related Rights and Collateral,
regardless of whether any such item was or was not executed, delivered or
endorsed in a similar context or on a prior occasion).


 


11.14       Retention of Records.  WFBC
shall have no obligation to maintain electronic records or retain any
documents, schedules, invoices, agings, or other Records delivered to WFBC by
the Customer in connection with this Agreement or the Related Documents or any
other document or agreement described in or related to this Agreement for more
than thirty (30) days after receipt by WFBC.


 


11.15       Effective.  This
Agreement shall become effective when it is executed and delivered by an
authorized officer of each party.  This
Agreement may be executed in counterparts and each counterpart shall constitute
one and the same original.  Manually
executed counterparts of the signature pages of this Agreement and any of
its Exhibits may be delivered by the parties electronically so long as
transmitted pages are reproducible on paper medium upon receipt.  Each party is duly authorized to print any
executed signature page so received and attach it to this Agreement or a
relevant Exhibit, as applicable, whereupon this Agreement or such Exhibit shall
be deemed to have been duly executed and delivered by the transmitting party
and the paper copy of this Agreement or such Exhibit assembled by the
recipient with such signature page attached shall be deemed an original
for all purposes, absent manifest error or bad faith.


 


11.16       Data Transmission.  WFBC
assumes no responsibility for privacy or security risks as a result of the
method of data transmission selected by the Customer.  WFBC only assumes responsibility for data
transmitted from the Customer once the data is received within WFBC’s internal
network.  WFBC assumes no responsibility
for privacy or security data transmitted from WFBC to the Customer once the
data is dispensed from WFBC’s internal network.


 


11.17       Confidential Information.  The Customer agrees that Wells Fargo &
Co., and all direct and indirect Subsidiaries of Wells Fargo & Co.,
may, among themselves, exchange, discuss or otherwise utilize any and all information
(including Confidential Information) they may have in their possession
regarding the Customer and its Affiliates, and the Customer waives any right of
confidentiality it may have with respect to such exchange of such
information.  Except as provided in the preceding sentence, WFBC covenants
and agrees to hold this Agreement and other nonpublic information
regarding the Customer, its Affiliates, and their respective businesses
(collectively, “Confidential Information”) in confidence, and agrees not to use
and not to disclose any of the contents of, provide any Person with copies of,
or use for any purpose not related to the purchases made hereunder, any
Confidential Information other than disclosure to (a) Wells Fargo &
Co., any direct or indirect Subsidiaries of Wells Fargo & Co.
(including WFBC) or any officers, directors, members, managers, employees or
outside accountants, auditors or attorneys of Wells Fargo & Co. or
such Subsidiaries (the “Wells Receivers”), (b) any prospective or actual
Assignee, syndication parties or participants, (c) any rating agency
of WFBC and (d) governmental authorities with appropriate
jurisdiction over WFBC; provided that each such Person is informed of
the confidential nature of the Confidential Information, and has 


 


35

















 


agreed
to treat the Confidential Information as confidential in accordance with terms
and conditions no less protective than as set forth in this Section. 
Notwithstanding the above stated obligations, no Person will be liable for
disclosure or use of Confidential Information which (i) was required by
law, including pursuant to a subpoena or other legal process, (ii) was in
such Person’s possession or known to such Person prior to receipt in connection
with purchases made hereunder, (iii) is or becomes known to the public
(without breach of any obligations hereunder), (iv) is or becomes
available to such Person from a source, other than a Wells Receiver, which is
not known to such Person to be under an obligation of confidentiality to the
Customer; or (v) is independently developed by such Person without the use
of the Confidential Information.  Notwithstanding any provision hereof to
the contrary, WFBC covenants and agrees that it shall not use the name of the
Customer or any Affiliate of the Customer, or any trademarks, trade names or
service marks of the Customer or any Affiliate of the Customer, or quote the
opinion of any employee of the Customer or any Affiliate of the Customer, in
any advertising or marketing material (including press releases) without first
obtaining the prior written consent of an officer of the Customer or such
Affiliate, as applicable.


 


11.18       Notices Hereunder.  Except as otherwise expressly provided
herein, all notices, requests, demands and other communications provided for
under this Agreement and the Related Documents shall be in writing and shall be
(a) personally delivered, (b) sent by first class United States mail,
(c) sent by overnight courier of national reputation for which a receipt
is available, (d) transmitted by telecopy, or (e) sent as electronic
mail, in each case delivered or sent to the party to whom notice is being given
to the business address, telecopier number, or e-mail address set forth below
next to its signature or, as to each party, at such other business address,
telecopier number, or e-mail address as it may hereafter designate in writing
to the other party pursuant to the terms of this Section 11.18.  All such notices, requests, demands and other
communications shall be deemed to be an authenticated record communicated or
given on (w) the date received if personally delivered, (x) five
Business Days after the date deposited in the mail if delivered by mail, (y) the
first Business Day after the date delivered to the courier if delivered by
overnight courier, or (z) the date of transmission if sent by confirmed
telecopy or e-mail before 5:00 p.m. (Chicago time) on a Business Day or if
sent after such time, the next Business Day. 
All notices, financial information, or other business records sent by
any party to this Agreement may be transmitted, sent, or otherwise communicated
via such medium as the sending party may deem appropriate and commercially
reasonable; provided, however, that the risk that the confidentiality or
privacy of such notices, financial information, or other business records sent
by any party may be compromised shall be borne exclusively by the Customer.


 


11.19       Costs and Expenses. 
Except as is prohibited by law, the Customer agrees to pay on demand all
costs and expenses, including reasonable attorneys’ fees (including in-house
counsel), incurred by WFBC in connection with this Agreement, any other Related
Document, the Related Rights and the transactions contemplated hereby and
thereby, including all such costs, expenses and fees incurred in connection
with the negotiation, due diligence, preparation, execution, amendment,
modification, administration, performance, collection and enforcement of this
Agreement, the Related Documents, the Related Rights, all obligations of the
Customer hereunder and thereunder and the creation, perfection, protection,
satisfaction, foreclosure or enforcement of any security interest granted
hereunder and the collection of any Purchased Account, any Related Right or any
obligation owed by the Customer to WFBC.


 


36

















 


11.20       Taxes.


 


(a)           Except as otherwise provided in this Section 11.20, any and all
payments made by the Customer hereunder shall be made free and clear and
without deductions for or on account of any present or future U.S., foreign,
federal, provincial, state, municipal, local or other taxes of any kind or
nature whatsoever, including any capital, income, sales, excise, business,
property, stamp, documentary, customs, imposts, deductions, charges or
withholdings, and all liabilities with respect thereto (excluding taxes that
are imposed on WFBC’s overall net income by any taxing authority) (all such
non-excluded taxes, levies, imposts, deductions, charges, withholdings and
liabilities of any kind or nature whatsoever and interest, penalties and
additions to tax in respect thereof being hereinafter referred to as “Taxes”). 
If any such withholdings or deductions are so required, (i) the sum
payable hereunder shall be increased as may be necessary so that after all
required deductions are taken into account (including any required with respect
to payments made pursuant to this Section 11.20(a)), WFBC shall receive an
amount equal to the sum it would have received had no such deduction been made,
(ii) the Customer shall make such deductions and (iii) the Customer
shall pay the full amount deducted to the appropriate authority before
penalties attach thereto or interest accrues thereon.  If the Customer
pays any such Taxes, it shall deliver official tax receipts evidencing that
payment or certified copies thereof to WFBC on or before the thirtieth day
after payment.


 


(b)           In addition, the Customer shall pay any present or future U.S., foreign,
federal, provincial, state, municipal, local or other taxes of any kind or
nature whatsoever, including any capital, income, sales, excise, business,
property, stamp, documentary, customs, imposts, deductions, charges or
withholdings, and all liabilities and interest, penalties and additions to tax
in respect thereof  imposed by any taxing authority (other than taxes that
are imposed on WFBC’s overall net income by any taxing authority) that arises
from any payment made hereunder, under any Related Document or from any proceeds
of any Purchased Account or Related Right or any withholding or deduction by an
Account Debtor (hereinafter referred to as “Other Taxes”).


 


(c)           Except as otherwise provided in this Section 11.20, the Customer
shall indemnify WFBC for and hold it harmless against the full amount of the
Taxes and Other Taxes paid by WFBC on account of any transaction contemplated
by this Agreement or any Related Document or the purchase of the Purchased
Accounts and the Related Rights.


 


11.21       Limitation.  In no event shall WFBC be liable to
the Customer for any consequential, incidental, special, punitive, or indirect
loss or damage arising out of or related to any provision of this Agreement,
including loss of profits or revenue, loss of opportunity or like items of loss
or damage except as specifically provided herein regardless of the legal basis
for any such claim and the Customer hereby releases WFBC therefrom.


 


11.22       Prohibited Rate.  In no
event shall any interest or fee to be paid hereunder exceed the maximum rate permitted
by applicable law.  In the event any such
interest rate or fee exceeds such maximum rate, such rate shall be adjusted
downward to the highest rate (expressed as a percentage per annum) or fee that
the parties could validly have agreed to by contract on the date hereof under
applicable law.  It is further agreed
that any excess actually received by WFBC shall be credited against any amount
owing hereunder.


 


37

















 


11.23       Jurisdiction.  The
parties hereby (a) consent to the personal jurisdiction of the state and
federal courts located in the State of Colorado, and any appellate court
from which any appeals therefrom are available, in connection with any
controversy related to this Agreement or any Related Document; (b) waive
any argument that venue in any such forum is not convenient; (c) agree
that any litigation initiated by WFBC or the Customer in connection with this
Agreement or any Related Document may be venued in the state or federal courts
located in the City and County of Denver, Colorado; and (d) agree that a
final judgment in any such suit, action or proceeding shall be conclusive and
may be enforced in other jurisdictions by suit on the judgment or in any other
manner provided by law.


 


11.24       Negotiations.  The
parties agree that this Agreement has been mutually negotiated at arm’s length
by both of them with benefit of legal counsel and such other advice as they
deemed appropriate and no provision hereof is to be construed more severely
against one of the parties than it is to be construed against the other based
on the party responsible for the drafting thereof.


 


11.25       USA PATRIOT Act Notice.  WFBC
hereby notifies the Customer that pursuant to the requirements of the USA
PATRIOT Act (Title III of Pub. L. 107-56 (signed into law October 26,
2001)), it is required to obtain, verify and record information that identifies
the Customer, which information includes the name and address of the Customer
and other information that will allow WFBC to identify the Customer in
accordance with the USA PATRIOT Act (Title III of Pub. L. 107-56 (signed into
law October 26, 2001)).


 


11.26       Termination.  This
Agreement shall terminate on the first date following the Termination Date when
the Purchased Amount has reduced to zero, all other amounts due to WFBC under
this Agreement and the Related Documents have been indefeasibly paid in full,
WFBC has no further obligations hereunder or any Related Document and all
obligations of the Customer to WFBC hereunder and under each Related Document
have been satisfied, in each case as determined by WFBC in its sole discretion
(the “Final Termination Date”).


 


11.27       Terms Generally.  Defined
terms include in the singular number the plural and in the plural number the
singular.  The use of the singular or the
plural number shall be deemed to include the use of the other when the context
so requires.  Whenever the context
require, any pronoun shall include the corresponding masculine, feminine and
neuter forms.  The words “include”, “includes”
and “including” shall be deemed to be followed by the phrase “without
limitation”.  The word “will” shall be
construed to have the same meaning and effect as the word “shall”.  Unless the context in which used herein
otherwise clearly requires, “or” has the inclusive meaning represented by the
phrase “and/or”.  Unless the context
requires otherwise, (a) any definition of or reference to any agreement,
instrument or other document herein shall be construed as referring to such
agreement, instrument or other document as from time to time amended,
supplemented or otherwise modified (subject to any restrictions on such
amendments, supplements or modifications set forth herein), (b) any
reference herein to any Person shall be construed to include such Person’s
successors and permitted assigns, (c) the words “herein”, “hereof” and “hereunder”,
and words of similar import shall be construed to refer to this Agreement in
its entirety and not to any particular provision hereof, (d) all
references herein to Articles, Sections, subsections, Exhibits, Schedules and
the like shall be construed to refer to Articles, Sections and subsections of,
or Exhibits or Schedules attached to, this Agreement unless otherwise expressly
provided and (e) all references herein to Articles, Sections, subsections
and 


 


38

















 


the
like shall be construed to include therein references to all Sections and
subsections thereof unless otherwise expressly provided.  Article and Section headings in
this Agreement are for reference only and shall not affect the construction of
this Agreement.  Reference to any law,
rule, regulation, order, decree, requirement, policy, guideline, directive or
interpretation means as amended, modified, codified, replaced or reenacted, in
whole or in part, and in effect on the determination date, including rules and
regulations promulgated thereunder.  All
accounting terms not otherwise defined herein have the meanings assigned to
them in accordance with generally accepted accounting principles.


 


[This space intentionally left blank.]


 


39

















 


11.28       WAIVER OF JURY TRIAL.  EACH OF
THE CUSTOMER AND WFBC HEREBY IRREVOCABLY WAIVES ANY RIGHT TO TRIAL BY JURY IN
ANY ACTION AT LAW OR IN EQUITY OR IN ANY OTHER PROCEEDING BASED ON OR
PERTAINING TO THIS AGREEMENT OR ANY RELATED DOCUMENT.


 


	
  [                                                      ]

  	
   

  	
  WELLS
  FARGO BANK, NATIONAL ASSOCIATION

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
  Name:

  	
   

  	
   

  	
  Name:
  Gina Draudt

  
	
  Its:

  	
  Authorized Signatory

  	
   

  	
  Its: Vice President

  



 


The
Customer and WFBC have executed this Agreement through their authorized
officers as of the date set forth above.


 


	
  Wells
  Fargo Bank, National Association

  	
   

  	
  WELLS
  FARGO BANK, NATIONAL ASSOCIATION

  
	
  MAC
  C7300-060

  	
   

  	
   

  	
   

  
	
  1740
  Broadway, 6th Floor

  	
   

  	
   

  	
   

  
	
  Denver,
  CO 80274

  	
   

  	
  By:

  	
   

  
	
  Telecopier:
  (303) 433-2540

  	
   

  	
  Name:
  Gina Draudt

  
	
  Attention:
  Monica Sorrels

  	
   

  	
  Its:
  Vice President

  
	
  Email:
  monicasorrels@wellsfargo.com

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  [                                                  ]

  	
   

  	
  [                                                    ]

  
	
  [Street
  Address]

  	
   

  	
   

  	
   

  
	
  [City,
  State ZIP]

  	
   

  	
  By:

  	
   

  
	
  Telecopier:

  	
   

  	
  Name:

  
	
  Attention:

  	
   

  	
  Its: Authorized Signatory

  
	
  Email:

  	
   

  	
   

  	
   

  
	
  Federal
  Employer ID No.:

  	
   

  	
   

  	
   

  
	
  Organization
  No.:

  	
   

  	
   

  	
   

  



 


 


With
copies to:


 


Broadwind
Energy, Inc.


47
E. Chicago Ave., Suite 332


Naperville, IL
60540


Telecopier:  630-637-8472


Attention:  Stephanie Kushner, CFO


E-mail:  Stephanie.Kushner@bwen.com


Attention:  Mark Henrickson


E-mail:  Mark.Henrickson@bwen.com


 


Signature
Page to Account Purchase Agreement


 

















 


Exhibit A


To


Account Purchase Agreement


 


Form of Assignment and Schedule of Accounts


 


See attached


 


A-1

















 


Exhibit B


To


Account Purchase Agreement


 


[Permitted Liens]


 


B-1