Exhibit 10.61





Exhibit 10.61




EXPORT LOAN AGREEMENT




THIS EXPORT LOAN AGREEMENT between JPMorgan Chase Bank, N.A. and FuelCell Energy, Inc., a
corporation organized and existing under the laws of Delaware (“Borrower”), is made and
executed as of January 4, 2011. This Agreement governs the Credit Accommodations described herein.
Borrower understands and agrees that: (a) in granting, issuing, renewing, or extending such
Credit Accommodations, Lender is relying upon Borrower’s representations, warranties, and
agreements set forth in this Agreement and the other Financing Documents; and (b) such Credit
Accommodations shall be and remain subject to the following terms and conditions of this Agreement
until all Borrower’s Obligations hereunder have been paid and performed in full.



ARTICLE I

CERTAIN DEFINED TERMS




Section 1.1 Definitions. Capitalized terms used but not defined in this Agreement
shall have the meanings assigned those terms in the Borrower Agreement. As used herein, the
following terms shall have the following meanings unless the context requires otherwise:



“Adjusted One Month LIBOR Rate” means, an interest rate per annum equal to the sum of
(i) 2.50% per annum plus (ii) the quotient of (a) the interest rate determined by Lender by
reference to the Reuters Screen LIBOR01 Page (or on any successor or substitute page) to be the
rate at approximately 11:00 a.m. London time, on such date or, if such date is not a Business Day,
on the immediately preceding Business Day, for dollar deposits with a maturity equal to one (1)
month divided by (b) one minus the Reserve Requirement (expressed as a decimal) applicable to
dollar deposits in the London interbank market with a maturity equal to one (1) month.



“Affiliate” shall mean any person, corporation or other entity directly or indirectly
controlling, controlled by or under common control with the Borrower and any director or officer of
the Borrower or any subsidiary of the Borrower.



“Agreement” shall mean this Export Loan Agreement, as it may be amended, modified,
restated, renewed and extended from time to time, together with all exhibits and schedules attached
hereto from time to time. This Agreement is the Loan Agreement referred to in the Borrower
Agreement.




“Borrower” shall mean FuelCell Energy, Inc. and its successors and assigns.



“Borrower Agreement” shall mean the Borrower Agreement relating to the Loan executed
by Borrower for the benefit of Lender and Ex-Im Bank, in the form prescribed by Ex-Im Bank attached
hereto as Exhibit A.



“Borrower’s Obligations” shall mean all loans, advances, debts, expenses, fees,
liabilities, and obligations, including any accrued interest thereon, for the performance of
covenants, tasks or duties or for payment of monetary amounts (whether or not such performance is
then required
or contingent, or such amounts are liquidated or determinable) owing by Borrower to Lender, of
any kind or nature, present or future, arising in connection with the Loan. Borrower’s Obligations
are the Loan Facility Obligations, as defined in the Borrower Agreement, and are included in the
Liabilities, as defined in the Security Agreement and the Guaranty.


 


 









 





“Business Day” means a day (other than a Saturday or Sunday) on which banks generally
are open in Connecticut and/or New York for the conduct of substantially all of their commercial
lending activities and on which dealings in United States dollars are carried on in the London
interbank market.



“CB Floating Rate” means the Prime Rate; provided that the CB Floating Rate
shall never be less than the Adjusted One Month LIBOR Rate. Any change in the CB Floating Rate due
to a change in the Prime Rate or the Adjusted One Month LIBOR Rate shall be effective from and
including the effective date of such change in the Prime Rate or the Adjusted One Month LIBOR Rate,
respectively.



“CBFR Interest” means interest accrued at the CB Floating Rate as contemplated by
Section 2.5.



“Collateral” shall mean all real or personal property and interests in real and
personal property in and upon which Lender has been granted a Lien, including the Security
Interest, as security for the payment and performance of Borrower’s Obligations and all Proceeds
thereof.



“Credit Period” shall be the period commencing on the Effective Date (as defined in
the Borrower Agreement) and ending on the Stated Final Disbursement Date.



“Default” means any Event of Default or any event or circumstance which will
constitute an Event of Default after notice or the passage of time or both.



“Default Rate” shall mean the interest otherwise applicable to the Credit
Accommodations, plus three percent (3%).



“Dollars” and the sign “$” shall mean dollars in lawful money of the United
States of America and, in relation to all payments in Dollars hereunder, (i) same day funds paid
through the Regional Clearing House Interbank Payments System, or (ii) immediately available funds
paid through the Regional Federal Reserve Bank, or (iii) such other funds as may then be required
by the customary procedure of member banks of the Regional Clearing House Association for the
settlement of payments.



“Domestic Credit Agreements” shall mean, collectively, the following agreements
together with all amendments, modifications and extensions thereof: (i) that certain Purchasing
Card Agreement governing the $1,800M internal guidance line to support business credit card use;
(ii) Application and Agreement for Irrevocable Standby Letter of Credit dated January 13, 2010,
executed by the Borrower, as applicant for the letter of credit in the amount of up to $333,000
described therein, to the Lender; (iii) Application and Agreement for Irrevocable Standby Letter of
Credit dated November 17, 2008, executed by the Borrower, as applicant for the letter of credit in
the amount of up to $570,895 described therein, to the Lender; (iv) Application and Agreement for Irrevocable Standby


 


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Letter of Credit dated May 12, 2010,
executed by the Borrower, as applicant for the letter of credit in the amount of up to $3,233,149
described therein, to the Lender, (v) Application and Agreement for Irrevocable Standby Letter of
Credit dated May 12, 2010, executed by the Borrower, as applicant for the letter of credit in the
amount of up to $3,121,999 described therein, to the Lender, (vi) Continuing Pledge Agreement dated
as of April 4, 2007 executed by the Borrower in favor of the Lender; (vii) Control Agreement dated
as of April 4, 2007 executed among the Borrower, the Lender and J.P. Morgan Securities Inc., as
securities intermediary; (viii) Assignment of Deposit(s) dated as of November 3, 2008 executed by
the Borrower in favor of the Lender; (ix) Assignment of Deposit Account dated as of January 13,
2010 executed by the Borrower in favor of the Lender; and (x) Assignment of Deposit Account dated
as of May 12, 2010 executed by the Borrower in favor of the Lender.



“Eligible Export-Related Accounts Receivable” means any Accounts which (a) arise as a
result of the export sale of Items, (b) are eligible for insurance under the Ex-Im Bank Short-Term
Comprehensive Insurance Program but are not insured due to policy limitations, (c) are not more
than 60 days past due, and (d) are not supported by sight drafts or letters of credit. In no event
will Eligible Export-Related Accounts Receivable include (i) any Accounts Receivable of the types
described in paragraphs (a) through (bb) of the definition of Eligible Export-Related Accounts
Receivable in the Borrower Agreement or (ii) any Accounts Receivable of any single Buyer whenever
the portion of the Accounts Receivable of such Buyer which have not been paid within sixty (60)
days from the due date is in excess of 50% of the total amount outstanding on all Accounts
Receivable payable by such Buyer.



“Event of Default” shall have the meaning assigned to such term in Section 8.1 of this
Agreement.



“Ex-Im Bank” shall mean the Export-Import Bank of the United States, its successors
and assigns.



“Ex-Im Bank Guarantee” shall mean the Master Guarantee Agreement between Lender and
Ex-Im Bank, together with (i) the Super Delegated Authority Letter Agreement between Lender and
Ex-Im Bank, (ii) the Affiliate Guarantee Authorization Agreement between Lender and Ex-Im Bank and
(iii) the Loan Authorization Notice.



“Export-Related Borrowing Base” shall mean, at the date of determination thereof, (a)
the sum of (i) the Export-Related Inventory Value multiplied by the Advance Rate applicable to
Eligible Export-Related Inventory set forth in Section 5.B.(1.) of the Loan Authorization Notice
plus (ii) the Export-Related Accounts Receivable Value multiplied by the Advance Rate applicable to
Eligible Export-Related Accounts Receivable set forth in Section 5.B.(2.) of the Loan Authorization
Notice, less (b) such reserves and in such amounts deemed necessary and proper by Lender from time
to time.



“Export-Related Borrowing Base Certificate” shall mean a Borrowing Base Certificate in
the form attached hereto as Exhibit B.


 


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“Export-Related Collateral” shall mean all Export-Related Inventory, Export-Related
Accounts Receivable (as such term of modified pursuant to the terms of the Waiver Letter),
Export-Related General Intangibles, and all Proceeds.



“Financing Documents” shall mean, collectively, this Agreement, the Note, the Security
Agreement, the Guaranty, the Borrower Agreement, the Ex-Im Bank Guarantee, the Waiver Letter, the
Letter of Credit Application(s), all Letters of Credit issued pursuant hereto, and any other
documents, certificates and agreements which are executed and delivered by Borrower or any other
Person evidencing, securing, guaranteeing or otherwise relating to Borrower’s Obligations. The
Financing Documents are the Loan Documents, as defined in the Borrower Agreement.



“Highest Lawful Rate” shall mean the maximum nonusurious rate of interest permitted to
be charged by applicable Federal or Connecticut law (whichever permits the higher lawful rate) from
time to time in effect.




“Incorporated Covenants” shall have the meaning given such term in Article VII.




“Lender” means JPMorgan Chase Bank, N.A., its successors and assigns.



“Letter of Credit Application” shall mean an Application and Agreement for Irrevocable
Standby Letter of Credit or an Application and Agreement for Irrevocable Commercial Letter of
Credit, as the case may be, in such form as is provided by Lender to Borrower and which is executed
by Borrower and delivered to Lender in connection with a request for the issuance of a Standby
Letter of Credit or a Commercial Letter of Credit, respectively, pursuant to this Agreement.



“LIBOR Advance” means the outstanding principal amount of the Note that is accruing
interest at the LIBOR Rate as provided in Section 2.5.



“LIBOR Interest” means interest accruing at the LIBOR Rate as contemplated by Section
2.5.



“LIBOR Period” means, the period commencing on the day the Borrower specifies as the
day any part of the outstanding principal balance of the Note is to begin to accrue interest at the
LIBOR Rate as contemplated by Section 2.5 and ending on the numerically corresponding day in the
calendar month that is one month thereafter, and each period of one month thereafter commencing on
the last day of the preceding LIBOR Period until the Borrower elects to thereafter have no part of
the outstanding principal balance of the Note accrue interest at the LIBOR Rate pursuant to Section
2.5(e); provided, that (i) if any such LIBOR Period would end on a day other than a
Business Day, such LIBOR Period shall be extended to the next succeeding Business Day unless such
next succeeding Business Day would fall in the next calendar month, in which case such LIBOR Period
shall end on the next preceding Business Day, (ii) any LIBOR Period that commences on the last
Business Day of a calendar month (or on a day for which there is no numerically corresponding day
in the next succeeding calendar month) shall end on the last Business Day of the next succeeding
calendar month, and (iii) any LIBOR Period that
would otherwise end after the Stated Final Disbursement Date shall end on the Business Day
after the Stated Final Disbursement Date.


 


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“LIBOR Rate” means, for any LIBOR Period, the interest rate per annum equal to the sum
of (i) 1.50% plus (ii) quotient of (a) the interest rate determined by Lender by reference to the
Reuters Screen LIBOR01 Page (or on any successor or substitute page) to be the rate at
approximately 11:00 a.m. London time, on the second Business Days immediately preceding the first
day of the LIBOR Period for dollar deposits with a maturity equal to one (1) month divided by (b)
one minus the Reserve Requirement (expressed as a decimal) applicable to dollar deposits in the
London interbank market with a maturity equal to one (1) month.



“Loan” means the credit facility described in Section 2.1. The Loan is the Loan
Facility, as defined in the Borrower Agreement.



“Loan Authorization Notice” shall mean the Loan Authorization Notice executed by
Lender and delivered to and acknowledged by Ex-Im Bank setting forth the terms and conditions of
the Loan, a copy of which is attached hereto as Exhibit C. The Loan Authorization Notice
is the Loan Authorization Notice, as defined in the Borrower Agreement.



“Maturity Date” shall mean the first Business Day following the Stated Final
Disbursement Date; provided, however, that with regard to Letter of Credit Obligations outstanding
on the Stated Final Disbursement Date, the Maturity Date for any Disbursement under the Letter(s)
of Credit related thereto shall be the first Business Day following the date of such Disbursement.



“Note” shall mean the promissory note of even date herewith in the original principal
amount of Five Million and No/100 Dollars ($5,000,000) executed by Borrower and payable to Lender
evidencing the outstanding principal balance of the Disbursements, together with all renewals,
extensions, modifications, refinancings and consolidations of and substitutions for such promissory
note.



“Prime Rate” means the rate of interest per annum announced from time to time by the
Lender as its prime rate. The Prime Rate is a variable rate and each change in the Prime Rate is
effective from and including the date the change is announced as being effective. THE PRIME RATE
IS A REFERENCE RATE AND MAY NOT BE THE BANK’S LOWEST RATE.



“Proceeds” or “proceeds” shall mean, when used with respect to any of the Collateral,
all products and proceeds, cash and non-cash, within the meaning of the UCC and shall include the
proceeds of any and all contracts, letters of credit and insurance policies.



“Property” means any interest in any kind of property or asset, whether real, personal
or mixed, tangible or intangible.



“Regulation D” means Regulation D of the Board of Governors of the Federal Reserve
System as from time to time in effect and any successor thereto or other regulation or official
interpretation of said Board of Governors relating to reserve requirements applicable to member
banks of the Federal Reserve System.


 


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“Reserve Requirement” means, with respect to any LIBOR Period, the maximum aggregate
reserve requirement (including all basic, supplemental, marginal and other reserves) which is
imposed under Regulation D.



“Requirement of Law” means, as to any Person, any law (statutory or common), treaty,
rule or regulation or determination of an arbitrator or of a Governmental Authority, in each case
applicable to or binding upon the Person or any of its Property or to which the Person or any of
its Property is subject.



“Security Agreement” shall mean the Security Agreement of even date herewith, executed
by Borrower in favor of Lender creating the Security Interest in the Collateral described therein,
together with all amendments, modifications and extensions thereof.



“Security Interest” is the security interest in the Collateral created pursuant to the
Security Agreement.



“Stated Final Disbursement Date” means the date stipulated as the Final Disbursement
Date in Section 10 of the Loan Authorization Notice.



“Waiver Letter” shall mean that, collectively, (i) that certain letter dated August 2,
2010 to Lender from Ex-Im Bank, (ii) that certain letter dated November 10, 2010 to Lender from
Ex-Im Bank, (iii) that certain letter dated December 13, 2010 and (iv) that certain e-mail
correspondence dated December 16, 2010, pursuant to which Ex-Im Bank waives some requirements under
the Master Guarantee Agreement, subject to the conditions specified therein.



Section 1.2 Accounting Terms. All accounting terms used but not defined in this
Agreement or the Borrower Agreement shall be construed in accordance and conformity with GAAP
applied on a consistent basis. Except as expressly provided herein, terms used herein that are
defined in the UCC and are not otherwise defined in this Agreement or the Borrower Agreement shall
have the meanings assigned to such terms in the UCC.



ARTICLE II

TERMS AND CONDITIONS




Section 2.1 Advances and Letters of Credit.



(a) Subject to the provisions of this Agreement, including without limitation the satisfaction
of the conditions described in Article III, Lender agrees to establish a Revolving Loan Facility
pursuant to which Lender may, in its sole discretion upon request of Borrower, make and incur
Credit Accommodations in support of Export Orders, provided the Credit Accommodation Amount at any
time shall not exceed the lesser of (i) the Maximum Amount, and (ii) the Export-Related Borrowing
Base. All Letters of Credit issued shall be in Dollars and all Disbursements shall be made in
Dollars.


 


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(b) Lender may agree to make advances directly to Borrower or for Borrower’s account during
the Credit Period, it being expressly agreed that Lender has no commitment to do so. Borrower
shall request each advance under the Loan by delivering to Lender a written request therefore, an
Export-Related Borrowing Base Certificate, a copy of the Export Order(s)
against which Borrower is requesting an advance, and such other information and documentation
as Lender may require, in accordance with Section 6.10. Upon receipt of the above described
information and documents by Lender, Lender shall make such advance within five (5) Business Days
following Lender’s determination that all conditions to the making of such advance have been
satisfied. Each advance shall be conclusively deemed to have been made at the request of and for
the benefit of Borrower (a) when credited to any deposit account of Borrower maintained with
Lender, or (b) when advanced in accordance with the instructions of an authorized Person. Lender,
at its option, may set a cutoff time, after which all requests for advances under the Loan will be
treated as having been requested on the next succeeding Business Day.



(c) Lender may agree to issue Letters of Credit on behalf of Borrower or for Borrower’s
account from time to time during the Credit Period, it being expressly agreed that Lender has no
commitment to do so. Standby Letters of Credit may be issued for Borrower’s account for use as a
performance bond, which Standby Letters of Credit can be drawn upon by Buyers only if Borrower
fails to perform its obligations with respect to the relevant Export Order. Each Disbursement to
fund a drawing under a Standby Letter of Credit shall conclusively be deemed to have been made when
advanced in accordance with a draw request or instructions of an authorized Person. Each Letter of
Credit will be in form and substance satisfactory to Lender and if approved for issuance by Lender
in its sole discretion, will be issued by Lender as soon as practicable following (a) Lender’s
receipt of a completed Letter of Credit Application, an Export-Related Borrowing Base Certificate,
a copy of the Export Order with respect to which Borrower is requesting a Letter of Credit, and
such other information and documentation as Lender may require, in accordance with Section 6.10;
and (b) Lender’s determination that all conditions to issuing such Letter of Credit have been
satisfied, including but not limited to the Borrower’s obligation to provide and maintain adequate
collateral in the amount equivalent to twenty-five percent (25%) of the undrawn amount of each
Letter of Credit issued hereunder. In no event shall (i) the expiry date of any Letter of Credit
be later than twelve (12) months from the date of issuance of such Letter of Credit. Lender shall
not be requested to issue during the last sixty (60) days of the Credit Period any Letter of Credit
which will expire after the Stated Final Disbursement Date unless Lender agrees in writing to a
renewal of the Loan, or Ex-Im Bank’s prior written approval of the issuance of such Letter of
Credit is obtained.



(d) The terms and conditions of each Letter of Credit Application delivered by Borrower and
accepted by Lender hereunder, including without limitation terms related to reimbursement of
amounts drawn and the payment of fees and interest, are incorporated herein by this reference;
provided, however, that (a) no provisions subjecting Lender and Borrower to arbitration or other
dispute resolution provisions contained in any Letter of Credit Application shall be incorporated
into this Agreement or applicable to Letters of Credit issued pursuant to this Agreement, and (b)
to the extent that there is any conflict between the terms and conditions of any Letter of Credit
Application and this Agreement, the terms of this Agreement shall prevail, except for (i)
definitions contained in any Letter of Credit Application, (ii) if there is any provision contained
in any Letter of Credit Application which subjects the Letter of Credit issued pursuant thereto to
the UCP, the UCP shall prevail and (iii) if there is any provision contained in any Letter of
Credit Application for a Standby Letter of Credit which subjects the Standby Letter of Credit
issued pursuant thereto to the ISP, the ISP shall prevail.



(e) The outstanding principal balance of Disbursements hereunder shall be evidenced
by the Note and shall be repaid as set forth in Section 2.3 below.


 


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(f) Interest on the outstanding principal balance of the Note shall accrue and be payable as
set forth in Section 2.5 below.



(g) If the Lender determines that the introduction of any Requirement of Law, or any change in
any Requirement of Law, or in the interpretation or administration of any Requirement of Law, has
made it unlawful, or that any central bank or other Governmental Authority has asserted that it is
unlawful, for the Lender to make the Disbursements and have interest accruing thereon on the basis
of the LIBOR Rate, then, on notice thereof by the Lender to the Borrower, the Disbursements shall
thereafter accrue interest at the CB Floating Rate until the Bank notifies the Borrower that the
circumstances giving rise to such determination no longer exist. If the Bank determines that for
any reason adequate and reasonable means do not exist for determining the LIBOR Rate for any LIBOR
Period, or that the LIBOR Rate does not adequately and fairly reflect the cost to the Bank of
making or maintaining the Disbursements, (i) the Bank will promptly so notify the Borrower, and
(ii) thereafter, the obligation of the Bank to make or maintain the Disbursements with interest
accruing thereon on the basis of the LIBOR Rate shall be suspended until the Lender revokes such
notice in writing.



Section 2.2 Credit Accommodations.



(a) The amount of the Credit Accommodations available to be made or incurred hereunder at any
particular time from time to time shall be equal to the difference between (a) the lesser at such
time of (i) the Maximum Amount, or (ii) the Export-Related Borrowing Base; and (b) the Credit
Accommodation Amount at such time. The Export-Related Borrowing Base shall be determined in
accordance with this Agreement, the Borrower Agreement, the Waiver Letter and the Export-Related
Borrowing Base Certificate. Any Eligible Export-Related Account Receivable included in the
Export-Related Borrowing Base which subsequently fails to satisfy any of the applicable eligibility
criteria shall immediately cease to be included in the Export-Related Borrowing Base.



(b) Notwithstanding anything contained in this Agreement to the contrary:




(i) Lender shall not undertake any new Credit Accommodation under this Agreement:




(A) after the Stated Final Disbursement Date;




(B) during the continuance of an Event of Default hereunder;




(C) if such Credit Accommodation has been or will be used in a manner
prohibited by the Borrower Agreement; or




(D) if no outstanding Export Order(s) exist with respect to Borrower.




(ii) No Warranty Letters of Credit shall be issued by Lender under this Agreement
without the prior written approval of Lender and Ex-Im Bank; and if such approval is
obtained, any Warranty Letter of Credit so approved shall be issued only
upon the satisfaction of all conditions to such issuance, including reserves from the
Export-Related Borrowing Base, established by Lender and Ex-Im Bank.


 


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Section 2.3 Payments and Prepayment of Borrower’s Obligations



(a) Borrower’s Obligations shall be paid (and may be prepaid) in accordance with the
provisions of this Agreement, the Borrower Agreement and the Note. Unless sooner due and payable
or paid pursuant to the other provisions of this Agreement, the Borrower Agreement and the Note,
Borrower shall pay to Lender in full on the Maturity Date all outstanding Borrower’s Obligations,
including, without limitation, the aggregate principal amount of all Disbursements then outstanding
and all accrued but unpaid interest, together with all other applicable fees, costs and charges, if
any, not yet paid. Disbursements made to Borrower or for Borrower’s account and repaid by Borrower
during the Credit Period may, at the option of Lender and at Borrower’s request, be available on a
continuous basis until the Stated Final Disbursement Date to fund Credit Accommodations made or
incurred under the Loan in accordance with the terms of this Agreement and the Borrower Agreement.



(b) In accordance with the Borrower Agreement, upon demand by Lender, Borrower shall provide
additional Collateral or make additional payment(s) to Lender to ensure that at all times (i) the
Export-Related Borrowing Base equals or exceeds the Disbursements; and (ii) the outstanding
principal balance of the Credit Accommodations that is supported by Eligible Export-Related
Inventory does not exceed sixty percent (60%) of the sum of (y) the outstanding principal balance
of the Disbursement(s), and (z) the undrawn face amount of all outstanding Commercial Letters of
Credit hereunder.



(c) All payments made by or received from Borrower or for Borrower’s account in respect of
Borrower’s Obligations (including prepayments by Borrower and Proceeds received by Lender) shall be
applied by Lender first to the payment of accrued and unpaid interest, second to
the payment of the principal amount of Borrower’s Obligations, and third to any unpaid
costs, fees and expenses due under this Agreement and the other Financing Documents.



(d) If (i) any payment or prepayment of principal of any LIBOR Advance is made other than on
the last day of the LIBOR Period for such LIBOR Advance or (ii) if Borrower fails to make a
principal or interest payment with respect to any LIBOR Advance on the date such payment is due and
payable, Borrower shall on demand pay to Lender any amounts required to compensate Lender for any
additional losses, out-of-pocket costs or expenses which it may reasonably incur as a result of
such payment or nonpayment, including any loss, cost or expense actually incurred by reason of the
liquidation or reemployment of deposits or other funds acquired by Lender to fund or maintain such
LIBOR Advance. A certificate of Lender setting forth any amount or amounts that Lender is entitled
to receive pursuant to this Section shall be delivered to Borrower and shall be conclusive absent
manifest error.


 


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Section 2.4 Reliance by Lender on Communications and Authorizations from Borrower. In
making or incurring any Credit Accommodation pursuant to this Agreement and the other Financing
Documents, Lender shall be authorized to rely on any Export-Related Borrowing Base Certificate,
Letter of Credit Application, or other information, documentation, notice or communication which
appears to have been executed and delivered by any of the
authorized representatives of Borrower who are designated in the general certificate delivered
by Borrower to Lender. In the event that the Person(s) authorized to execute and deliver such
documents or to take action hereunder on behalf of Borrower become(s) unavailable or unable to do
so, Borrower promptly shall appoint one or more successor representative(s) and shall furnish
Lender with a certificate satisfactory to Lender which shall contain a copy of the resolutions or
other actions taken by Borrower to authorize such appointment(s) and the specimen signature of each
Person so appointed to act on behalf of Borrower pursuant to this Agreement.



Section 2.5 Interest.



(a) The outstanding principal balance of the Note shall bear interest at the option of the
Borrower at either the CB Floating Rate or the LIBOR Rate, in each case as specified by Borrower to
Bank in writing in form acceptable to Lender pursuant to paragraph (e) of this Section 2.5;
provided that (A) if prior to the commencement of any LIBOR Period Lender determines (which
determination shall be conclusive absent manifest error) that adequate and reasonable means do not
exist for ascertaining the LIBOR Rate; or the Lender determines that the LIBOR Rate will not
adequately and fairly reflect the cost to Lender of making or maintaining any LIBOR Advance, then
the entire outstanding principal balance of the Note shall accrue interest at the CB Floating Rate;
and (B) the outstanding principal amount of the Note not paid when due will bear interest from its
due date until paid at the Default Rate. Notwithstanding the foregoing, if at any time the rate
determined to be applicable to the outstanding principal balance of the Note pursuant to the
foregoing sentence (the “Contract Rate”) exceeds the Highest Lawful Rate, the actual rate
of interest to accrue on such principal amount will be limited to the Highest Lawful Rate, but any
subsequent reductions in the Contract Rate for any reason will not reduce the interest rate payable
on such amount below the Highest Lawful Rate until the total amount of interest accrued on such
principal amount equals the amount of interest which would have accrued if the Contract Rate had at
all times been in effect.



(b) Notwithstanding the foregoing, during the occurrence and continuance of an Event of
Default, the Lender may, at its option, by notice to the Borrower (which notice may be revoked at
the option of the Lender), declare that the entire outstanding principal balance of the Note shall
bear interest at the Default Rate.



(c) CBFR Interest shall be paid on the last day of each calendar month and LIBOR Interest
shall be paid on the last day of each applicable LIBOR Period; provided that (i) Default
Interest shall be payable on demand, and (ii) in the event of any repayment or prepayment of the
Note, accrued interest on the principal amount repaid or prepaid shall be payable on the date of
such repayment or prepayment.



(d) All CBFR Interest shall be computed on the basis of a year of 365 days (or 366 days in a
leap year) and all LIBOR Interest shall be computed on the basis of a year of 360 days, and in each
case shall be payable for the actual number of days elapsed. The applicable CB Floating Rate or
LIBOR Rate shall be determined by the Lender, and such determination shall be conclusive absent
manifest error.


 


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(e) At any time and from time to time, Borrower may notify Lender in writing in form
acceptable to Lender of what portion of the outstanding principal amount of the Note Borrower
elects to accrue interest at the LIBOR Rate and the first day of the LIBOR Period to
apply thereto, which day shall be at least three Business Days after the date of such notice;
and the remaining outstanding principal balance of the Note shall accrue interest at the CB
Floating Rate; provided that (i) at no time may more than one LIBOR Period be in effect; (ii) the
minimum outstanding principal amount of any LIBOR Advance shall be $100,000; and (iii) in the event
Borrower fails to so notify Lender that a portion of the outstanding principal balance of the Note
is to accrue interest at the LIBOR Rate, Borrower shall be deemed to have elected the CB Floating
Rate to be the rate of interest applicable to the entire outstanding principal balance of the Note;
and (iv) in the event Borrower fails to notify Lender at least three Business Days prior to the
last day of any LIBOR Period that Borrower elects to change the outstanding principal amount of the
LIBOR Advance for a new LIBOR Period, Borrower shall be deemed to have elected to continue to have
the same amount continue to accrue interest at the LIBOR Rate for an additional LIBOR Period
commencing on the last day of the current LIBOR Period.



ARTICLE III

CONDITIONS PRECENDENT




Section 3.1 Conditions to Credit Accommodation. Lender may elect in its sole
discretion to make or not to make any Credit Accommodation requested Borrower, it being expressly
agreed that Lender has no commitment to do so hereunder. Prior to making a decision about any
requested Credit Accommodation, Lender requires satisfaction of each of the following conditions
precedent, with all documents, instruments, opinions, reports, and other items described below to
be in form and substance satisfactory to Lender:



(a) Lender shall have received evidence that this Agreement and all other Financing Documents
have been duly authorized, executed, and delivered by the parties thereto and shall be and remain
valid and enforceable.



(b) To the extent not previously received by Lender, Lender shall have received a general
certificate of the Secretary of Borrower, dated no later than the date of the execution and
delivery of this Agreement, certifying (i) that attached thereto is a true, complete and correct
copy of Borrower’s organizational documents as then in effect, (ii) that attached thereto is a
true, complete and correct copy of resolutions adopted by the board of directors or similar
governing body of Borrower authorizing the execution and delivery of this Agreement and each of the
other Financing Documents and authorizing Borrower to incur Borrower’s Obligations and to perform
all other covenants and agreements of Borrower contained in this Agreement and in the other
Financing Documents, and (iii) as to the incumbency and specimen signature of each officer of
Borrower who is authorized to execute and deliver this Agreement, all Export-Related Borrowing Base
Certificates and Letter of Credit Applications to be delivered pursuant hereto, and any other
Financing Documents and other instruments, certificates and documents to be executed and delivered
by Borrower hereunder.



(c) Lender shall have received satisfactory evidence that the insurance which Borrower is
required to maintain pursuant to this Agreement, including but not limited to the insurance
described in Section 6.6, is in full force and effect.



(d) Borrower shall have paid all of the fees, costs and expenses which are due and payable
under this Agreement and any other Financing Document.


 


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(e) Ex-Im Bank shall have acknowledged to Lender Ex-Im Bank’s receipt of the Loan
Authorization Notice to Lender effecting the coverage of Borrower’s Obligations under the Ex-Im
Bank Guarantee.



(f) All conditions set forth in the Loan Authorization Notice that were to be satisfied as of
the date of Lender’s making or incurring the requested Credit Accommodation shall have been
satisfied, and Lender otherwise shall be permitted under the Ex-Im Bank Guarantee to make and incur
Credit Accommodations hereunder.



(g) All legal matters incident to the Loan and all documents necessary in the opinion of
Lender to the making or incurring of Credit Accommodations shall be satisfactory in all respects to
counsel for Lender.



(h) All Liens, including the Security Interest, in and upon the Collateral shall have been
duly authorized, created and perfected, (i) with first priority, with respect to the Collateral
described in Section 6(A) of the Loan Authorization Notice, and (ii) with the priorities set forth
in Sections 6(E) and (F) of the Loan Authorization Notice with respect to other Collateral, in each
case subject only to Permitted Liens, and shall be and remain valid and enforceable.



(i) Lender, at its option and for its sole benefit, shall have conducted an audit of the
Collateral, books, records, and operations, and Lender shall be satisfied as to their condition.



(j) Lender shall have received a completed and executed Export-Related Borrowing Base
Certificate and any other information and documentation that Lender may require, in accordance with
Section 4.3 hereof.



(k) (i) Borrower shall have complied with, and shall then be in compliance with, all the
terms, covenants, and conditions of this Agreement, the Borrower Agreement, and all other Financing
Documents which are binding upon it, (ii) there shall exist no Event of Default under this
Agreement, and (iii) all representations and warranties of Borrower contained in this Agreement and
all other Financing Documents shall be true and correct.



(l) Borrower shall have complied with, and shall then be in compliance with, all the terms,
covenants, and conditions of any other agreement now existing or hereafter arising between Lender
and Borrower, and there shall exist no default or event of default thereunder.



(m) Borrower shall have complied with applicable laws, and regulations in each instance in
which Borrower has generated, handled, used, stored or disposed of any hazardous or toxic waste or
substance, on or off its premises (whether or not owned by Borrower). Borrower shall have no
material contingent liability for non-compliance with environmental or hazardous waste laws.
Borrower shall have not received any notice that it or any of its property or operations does not
comply with, or that any governmental authority is investigating its compliance with, any
environmental or hazardous waste laws.



(n) There shall have been no material adverse change in the business, condition (financial or
otherwise), operations, performance, property or prospects of Borrower or the Borrower’s
subsidiaries since December 31, 2009.


 


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(o) Lender shall have received from Borrower an Economic Impact Certification covering the
Items described in Paragraph 4.A of the Loan Authorization Notice.



ARTICLE IV

SECURITY




Section 4.1 Collateral. To secure payment and performance of all Borrower’s
Obligations, Borrower shall grant to Lender valid, enforceable and duly perfected Liens, including
the Security Interest, on all Collateral. The Liens shall be of first priority with respect to the
Collateral described in Section 6(A) of the Loan Authorization Notice, and the Liens shall have the
priorities set forth in Sections 6(E) and (F) of the Loan Authorization Notice with respect to the
other Collateral, in each case subject only to Permitted Liens. Borrower agrees that Lender shall
have in respect of all Collateral that is subject to the UCC all of the rights and remedies of a
secured party under the UCC in all states in which any portion of the Collateral may be located, as
well as those provided in this Agreement. In the event Lender has extended or extends a loan or
other credit accommodation to Borrower in addition to the Loan and receives a Lien on any assets or
property, the Lien on such assets and property shall also secure Borrower’s Obligations, and
Borrower agrees to execute such documents and instruments as Lender requires to extend such
security to Borrower’s Obligations.



Section 4.2 Perfection of Security Interest. Borrower agrees to the filing of
financing statements and the execution of other documents and to take whatever other actions are
requested by Lender to perfect and continue Lender’s Liens upon the Collateral. Borrower hereby
appoints Lender as its irrevocable attorney-in-fact for the purpose of executing any financing
statements and other documents necessary to perfect or to continue its Liens. Lender may at any
time, and without further authorization from Borrower, file a copy, photograph, facsimile, or other
reproduction of any financing statement for use as a financing statement. Borrower will reimburse
Lender for all expenses for the perfection, termination, and the continuation of the perfection of
Lender’s Liens upon the Collateral. Borrower will promptly notify Lender of any change in
Borrower’s name including any change to the assumed business names of Borrower. Borrower also will
promptly notify Lender of any change in Borrower’s social security number or employer
identification number. Before any cash Collateral shall be included in the Export-Related
Borrowing Base, the Borrower shall cause each deposit account or other bank account in which such
cash is deposited to be subject to a first priority lien in favor of Lender pursuant to an account
control agreement in form and substance satisfactory to Lender. The Lender’s Security Interest in
any Export-Related Accounts Receivable shall be further perfected by Borrower’s execution and
delivery to Lender of any instruments, the giving of any notices and the taking of any additional
steps that may be required under foreign law in order to ensure the effectiveness of the assignment
of such Export-Related Accounts Receivable against the Buyer.




 


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Section 4.3 Collateral Records and Reports; Field Examinations. Borrower does now,
and at all times hereafter shall keep correct and accurate books and records of the Collateral, all
of which books and records shall be available to Lender or Lender’s representative upon demand for
inspection and copying at any reasonable time. In this connection, Borrower acknowledges that
Lender is required by Ex-Im Bank to perform (or contract to perform) a field examination of
Borrower and the Collateral in accordance with Lender’s customary procedures but in no event less
than every six months. Such field examination shall include without limitation an inspection and valuation of Inventory and Other Assets, a book audit of Accounts Receivable and a review
of the Accounts Receivable Aging Report. Borrower further acknowledges that Lender is required by
the Ex-Im Bank to perform (or contract to perform) a review of Borrower’s sales records at least on
a quarterly basis. For Revolving Loan Facilities, if Lender elects in its sole discretion to make
Credit Accommodations based upon summaries of Export Orders, then at least once each quarter,
Lender shall review a sampling selected by Lender of those Export Orders representing at least ten
percent (10%) of the aggregate Dollar volume of Export Orders and ten percent (10%) of the number
of Export Orders supporting Credit Accommodations made or incurred during the past quarter.
Specifically with respect to Export-Related Collateral, Borrower agrees to keep and maintain such
books and records as Lender may require. Borrower shall submit to Lender in writing from time to
time upon Lender’s request and in any event no later than twenty (20) days after the end of each
calendar month (a) an Accounts Receivable Aging Report for the immediately preceding month, which
report shall include the customer name, Dollar amount due and number of days outstanding for each
Export-Related Account Receivable, (b) an Inventory schedule for the immediately preceding month,
which schedule shall include the location of each Item of Inventory, (c) information concerning the
status of completion of Export Orders, and (d) such other information, reports, contracts, invoices
and other data relating to the Collateral as Lender may request.



Section 4.4 Payment under Borrower Letters of Credit. If the letter of credit payment
terms for the country specified in a certain Export Order are specified in the Country Limitation
Schedule with respect to such country, Borrower shall require that each commercial letter of credit
issued for its benefit with respect to any Export-Related Account Receivable or Export-Related
Inventory arising out such Export Order shall provide that all payments of drawings thereunder
shall be paid for the account of Borrower directly to Borrower’s account with Lender, or,
alternatively, that payment shall be made only to Lender’s account.



Section 4.5 Assignment of Foreign Credit Insurance Policy Proceeds and Buyer/Supplier
Financing. Borrower shall, simultaneously with the execution of this Agreement and as and when
such policies are put into effect or financing is obtained by Borrower for the benefit of any
Buyer, at any time prior to the payment and performance in full of Borrower’s Obligations, assign
to Lender the proceeds of all foreign credit insurance policies maintained by Borrower and any
financing obtained by Borrower for the benefit of any Buyer, including, without limitation, any
financing the repayment of which is guaranteed or insured by Ex-Im Bank or any other expert credit
agency, such assignment to provide for payment to be made directly into Borrower’s account with
Lender or to Lender.



Section 4.6 Loss of Collateral. Lender shall not be liable for the loss of any
Collateral in its possession, nor shall such loss diminish Borrower’s Obligations.



Section 4.7 Negative Pledge. Until the Borrower’s Obligations hereunder have been
paid in full, unless the Bank otherwise consents in writing, the Borrower agrees that it shall not
create or agree to create, any Lien on the Collateral, except for Permitted Liens or Liens created
for the benefit of Lender to secure the Borrower’s Obligations.


 


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ARTICLE V

REPRESENTATIONS AND WARRANTIES




Borrower represents and warrants the following to Lender and Ex-Im Bank, as of the Effective
Date, as of the date each Credit Accommodation is made or incurred hereunder, as of the date of any
renewal, extension or modification of the Loan, and at all times any of Borrower’s Obligations are
outstanding, and it is the affirmative obligation of Borrower to notify Lender in writing promptly,
but in any event within five (5) Business Days, of any occurrence, circumstance or fact which would
affect its ability to make the representations and warranties contained herein:



Section 5.1 Organization and Authority. Borrower is a corporation which is duly
organized, validly existing, and in good standing under the laws of the state of Borrower’s
formation and is duly qualified and in good standing in all other states in which Borrower is doing
business except where the failure to so qualify would not be expected to have a Material Adverse
Effect. Borrower has the full power and authority to own its properties and to transact the
businesses in which it is presently engaged or presently proposes to engage. Borrower has not been
suspended or debarred from doing business with the United States government. The execution,
delivery, and performance of this Agreement and all other Financing Documents to which Borrower is
a party have been duly authorized by all necessary action by Borrower; do not require the consent
or approval of any other Person; and do not conflict with, result in a violation of, or constitute
a default under (a) any provision of Borrower’s organizational documents or any other agreement or
instrument binding upon Borrower, or (b) any law, governmental regulation, court decree, or order
applicable to Borrower. Borrower has all requisite power and authority to execute and deliver this
Agreement and all other Financing Documents to which Borrower is a party.



Section 5.2 Financial Condition. Each financial statement of Borrower supplied to
Lender fairly discloses financial condition of Borrower as of the date of each such statement, and
there has been no material change in Borrower’s financial condition subsequent to the date of the
most recent financial statement supplied to Lender, which has had or could reasonably be expected
to have a Material Adverse Effect. Borrower has no material contingent obligations except as
disclosed in such financial statements.



Section 5.3 Legal Effect. This Agreement and all other Financing Documents to which
Borrower is a party constitute legal, valid and binding obligations of Borrower enforceable against
Borrower in accordance with their respective terms, except as limited by applicable bankruptcy and
creditors’ rights laws, or principles of general equity.



Section 5.4 Properties. Borrower is the sole owner of, and has good title to, all of
Borrower’s properties free and clear of all security interests except for Permitted Liens and Liens
in favor of Lender. Title to all of Borrower’s properties are in Borrower’s legal name, and
Borrower has not used, or filed a UCC financing statement under, any other name for at least the
last six (6) years. Borrower possesses all permits, licenses, patents, trademarks, and copyrights
required to conduct its business. All easements, rights-of-way and other rights necessary to
maintain and operate Borrower’s property have been obtained and are in full force and effect.


 


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Section 5.5 Compliance. Except as disclosed to and acknowledged by Lender in writing,
(a) Borrower is conducting Borrower’s businesses in material compliance with all applicable
federal, state and local laws, statutes, ordinances, rules, regulations, orders, determinations and
court decisions, including, without limitation, those pertaining to health or environmental
matters, and (b) Borrower otherwise does not have any contingent liability in connection with the
release into the environment, disposal or the improper storage of any toxic or hazardous substance
or solid waste which has had or could reasonably be expected to have a Material Adverse Effect.



Section 5.6 Licenses. All necessary licenses, permits and authorizations required for
the exporting of Items have been or will be timely obtained by Borrower, and to the best of
Borrower’s knowledge, all required necessary licenses, permits and authorizations have been or will
be timely obtained by each importer.



Section 5.7 Performance. Borrower has an operating history of at least one year.
Borrower has sufficient financial resources with which to perform its Export Orders and to pay any
costs of completing its Export Orders which are not paid from the proceeds of the Loan.



Section 5.8 Litigation and Claims. No litigation, claim, investigation,
administrative proceeding or similar action (including those for unpaid taxes) against Borrower is
pending or, to Borrower’s knowledge, threatened, and no other event has occurred which has had or
could reasonably be expected to have a Material Adverse Effect other than litigation, claims, or
other events, if any, that have been disclosed to and acknowledged by Lender in writing.



Section 5.9 Taxes. All tax returns and reports of Borrower that are or were required
to be filed have been filed in a timely manner, and all taxes, assessments and other governmental
charges have been paid in full, except those that have been disclosed in writing to Lender which
are presently being or to be contested by Borrower in good faith in the ordinary course of business
and for which adequate reserves have been provided.



Section 5.10 Lien Priority. Unless otherwise previously disclosed to and approved by
Lender in writing, Borrower has not entered into any security agreements, granted a Lien or
permitted the filing or attachment of any Lien (other than Permitted Liens) on or affecting any of
the Collateral, except in favor of Lender.



Section 5.11 Use of Proceeds. Borrower shall not use any Loan proceeds for (i) the
purchasing of fixed assets, (ii) capital expenditures, or (iii) the purchasing or carrying of
“margin stock” as defined in Regulation U issued by the Board of Governors of the Federal Reserve
System.



Section 5.12 Employee Benefit Plans. Each employee benefit plan as to which Borrower
may have any liability complies in all material respects with all applicable requirements of law
and regulations, and (a) no Reportable Event nor Prohibited Transaction (as defined in ERISA) has
occurred with respect to any such plan, (b) Borrower has not withdrawn from any such plan or
initiated steps to do so, (c) no steps have been taken to terminate any such plan, and (d) there
are no unfunded liabilities other than those previously disclosed to Lender in writing.


 


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Section 5.13 Location of Borrower’s Offices and Records. Borrower’s place of
business, or Borrower’s chief executive office if Borrower has more than one place of business, is
located at the address for notices to Borrower set forth in Section 9.4. Unless Borrower has
notified Lender and Lender has acknowledged in writing to the contrary, said address is also the
location of Borrower’s books and records concerning the Collateral.



Section 5.14 Export-Related Accounts Receivable.



(a) All Export-Related Accounts Receivable represented by Borrower to constitute Eligible
Export-Related Accounts Receivable satisfy all relevant eligibility criteria.



(b) All Export-Related Receivables information contained in Export-Related Borrowing Base
Certificates and related reports delivered to Lender will be true and correct, subject to
immaterial variance.



(c) Lender shall have the right at any time upon reasonable notice, during normal business
hours and at Borrower’s expense to confirm with Buyers the accuracy of such Export-Related Accounts
Receivable information.



Section 5.15 Information. All information heretofore or contemporaneously herewith
furnished by Borrower to Lender for the purposes of or in connection with this Agreement or any
transaction contemplated hereby is, and all information hereafter furnished by or on behalf of
Borrower to Lender will be, true and accurate in every material respect on the date as of which
such information is dated or certified; and none of such information is or will be incomplete by
omitting to state any material fact necessary to make such information not misleading. Borrower
understands and agrees that Lender, without independent investigation, is relying upon the above
representations and warranties in extending the Loan to Borrower. Borrower further agrees that the
foregoing representations and warranties shall be continuing in nature and shall remain in full
force and effect as long as any of Borrower’s Obligations remain outstanding.



ARTICLE VI

COVENANTS




Borrower covenants and agrees with Lender that, while this Agreement is in effect and until
all of Borrower’s Obligations are fully paid and performed, Borrower shall:



Section 6.1 Additional Liabilities. Promptly, but in any event within five (5)
Business Days, inform Lender in writing (a) in the event any litigation, claim, investigation,
administrative proceeding or similar action affecting Borrower which could reasonably be expected
to have a Material Adverse Effect is filed or threatened against Borrower, and (b) of the creation,
occurrence or assumption by Borrower of any actual or contingent liabilities not permitted under
this Agreement.



Section 6.2 Financial Records. Maintain or cause to be maintained books and records
in accordance with GAAP, and permit Lender and Ex-Im Bank or their representatives to examine,
review, audit and make and take away copies or reproductions of Borrower’s books and records at all
reasonable times. If any books and records, including, without limitation, computer generated
records and computer software programs for the generation of such records, now or
hereafter are maintained in the possession of a third party, Borrower, upon request of Lender,
shall instruct such party to permit Lender and Ex-Im Bank or their representatives free access to
such records at all reasonable times and to provide Lender with copies of any records it may
request, all at Borrower’s expense.


 


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Section 6.3 Reporting Requirements. Furnish to Lender:



(a) As soon as available and in any event not later than forty-five (45) days after the end of
each fiscal quarter the unaudited consolidated financial statements of Borrower as of the end of
such quarter and the related unaudited statements of income and shareholders’ equity and cash flows
for the period commencing at the end of the previous year and ending with the end of such quarter,
and the corresponding figures as at the end of, and for, the corresponding period in the preceding
fiscal year, all in reasonable detail and duly certified with respect to such statements (subject
to year-end audit adjustments) by an authorized financial officer of Borrower as having been
prepared in accordance with GAAP;



(b) As soon as available and in any event not later than one hundred and twenty (120) days
after the end of each fiscal year, a copy of the audited annual consolidated financial statement
for such year for Borrower including therein audited balance sheets of Borrower as of the end of
such fiscal year and the related statements of income, shareholders’ equity and cash flows for such
fiscal year, and the corresponding figures as at the end of, and for, the preceding fiscal year, in
each case audited and certified by a firm of independent certified public accountants of recognized
standing acceptable to Lender, including any management letters delivered by such accounting firm
to Borrower in connection with such audit together with a certificate of such accounting firm to
Lender stating that, in the course of the regular audit of the business of Borrower which auditing
was conducted by such accounting firm in accordance with generally accepted auditing standards,
such accounting firm has obtained no knowledge that an Event of Default has occurred and is
continuing, or if, in the opinion of such accounting firm, an Event of Default has occurred and is
continuing, a statement as to the nature thereof;



(c) To the extent not hereinabove described, the financial statements of Borrower deliverable
pursuant to the Loan Authorization Notice by the dates set forth therein.



Section 6.4 Taxes, Charges and Liens.



(a) Pay and discharge when due and prior to the date on which penalties would attach, all of
Borrower’s indebtedness and obligations, including, without limitation, all assessments, taxes,
governmental charges, levies and liens, of every kind and nature, imposed upon Borrower or its
properties, income, or profits, and all lawful claims that, if unpaid, might become a lien or
charge upon any of Borrower’s properties, income, or profits; provided, however, Borrower will not
be required to pay and discharge any such assessment, tax, charge, levy, lien or claim so long as
(i) the legality of the same shall be contested in good faith by appropriate proceedings, and (ii)
Borrower shall have established or caused to have been established adequate reserves with respect
to such contested assessment, tax, charge, levy, lien, or claim in accordance with GAAP.


 


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(b) Borrower, upon demand of Lender, will furnish to Lender evidence of payment of the
assessments, taxes, charges, levies, liens and claims and will authorize the appropriate
governmental official to deliver to Lender at any time a written statement of any assessments,
taxes, charges, levies, liens and claims against Borrower’s properties, income, or profits.



Section 6.5 Additional Information. Furnish to Lender such additional information and
statements, lists of assets and liabilities, aging of receivables and payables, inventory
schedules, budgets, forecasts, financial information on principal suppliers of Borrower, and other
reports with respect to Borrower’s financial condition and business operations as Lender may
reasonably request from time to time, including, without limitation, reports with respect to
Borrower’s accounts payable within thirty (30) days after the end of each calendar month.



Section 6.6 Insurance. Maintain fire and other risk insurance, public liability
insurance, business interruption insurance, multi-hazard insurance, export credit insurance,
worker’s compensation coverage, general liability insurance, and such other insurance as Lender may
require with respect to Borrower’s properties and operations, in form, amounts, coverage and with
insurance companies reasonably acceptable to Lender. If Borrower fails to provide any required
insurance or fails to continue such insurance in force, Lender may, but shall not be required to,
obtain such insurance at Borrower’s expense, and the cost of such insurance will be added to
Borrower’s Obligations. Borrower, upon request of Lender, will deliver to Lender from time to time
the policies or certificates of insurance in form and substance satisfactory to Lender, including
stipulations that coverage will not be canceled or changed without at least ten (10) days’ prior
written notice to Lender. In connection with all policies covering any of the Collateral, Borrower
will provide Lender with such loss payable or other endorsements as Lender may require; and each
such policy in any event shall contain a standard non-contributing, non-reporting mortgagee or loss
payee clause naming Lender as mortgagee and loss payee. Each liability insurance policy shall name
Lender as additional insured. At Lender’s request Borrower shall furnish to Lender from time to
time reports on each existing insurance policy including, without limitation, the following: (a)
the name of the insurer; (b) the risks insured; (c) the amount of the policy; (d) the properties
insured; (e) the then current property values on the basis of which insurance has been obtained,
and the manner of determining those values; (f) the expiration date of the policy; and (g) such
additional information as Lender may request.



Section 6.7 Other Agreements. Comply with, and cause its Affiliates to comply in all
material respects with, all terms and conditions of all other agreements, whether now or hereafter
existing, between Borrower and any other party, and notify Lender immediately in writing of any
default in connection with any other such agreements.



Section 6.8 Performance. Perform and comply with all terms, conditions, and
provisions set forth in this Agreement and in the other Financing Documents and in all Export
Orders (including, without limitation, the delivery of the goods required thereby free and clear of
defects and prior to the deadline specified therein) in a timely manner, and promptly notify Lender
(including, without limitation, providing such notice of events as is required pursuant to the
Borrower Agreement) of the occurrence of any event which constitutes or may constitute an Event of
Default under this Agreement or a default under any of the other Financing Documents or Export
Orders. Borrower shall, as soon as possible, take all actions necessary to entitle Borrower to
receive any payments due under all Export Orders, including, without limitation, the
timely drawing of drafts under any letters of credit issued for the benefit of Borrower in
connection therewith and the timely presentation of any claims under any insurance policy issued
by, or financing guaranteed by, Ex-Im Bank or any other insurer or guarantor.


 


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Section 6.9 Operations. Conduct its business affairs in a reasonable and prudent
manner and in compliance with all applicable federal, state, municipal, and foreign laws,
ordinances, rules and regulations respecting its properties, charters, businesses and operations,
including without limitation, compliance with the Americans with Disabilities Act, all applicable
environmental statutes, rules, regulations and ordinances and with all minimum funding standards
and other requirements of ERISA and other laws applicable to Borrower’s employee benefit plans.



Section 6.10 Export-Related Borrowing Base Certificates. In addition to deliveries
within five (5) Business Days prior to the date each request for a Credit Accommodation is made by
Borrower (if required by Lender) or as otherwise required by Lender and Ex-Im Bank, and so long as
there are any Credit Accommodations outstanding under the Loan, deliver to Lender no later than the
twenty (20) days after the end of each calendar month an Export-Related Borrowing Base Certificate,
along with such supporting documentation as Lender may request. Without limiting the generality of
the foregoing, each Export-Related Borrowing Base Certificate shall include or be accompanied by
(a) in the event Borrower is requesting Credit Accommodations, a copy of the Export Order(s) (or,
for Revolving Loan Facilities, if permitted in writing by Lender, a written summary of the Export
Order(s)) and related invoice(s) against which Borrower is requesting Credit Accommodations, and
copies of all other documentation pursuant to which the Buyer’s obligations in respect of the
Export Order(s) are evidenced, secured or guaranteed, and (b) in all cases, an Accounts Receivable
Aging Report and Inventory schedule as described in Section 4.3, reconciled directly to Borrower’s
month-end Accounts Receivable report, its month-end Inventory schedule, and its general ledger,
adjusted for intra-month sales, receipts, credits and other adjustments.



Section 6.11 Additional Assurances. Execute, acknowledge and deliver, or cause to be
executed, acknowledged or delivered, to Lender and Ex-Im Bank such promissory notes, mortgages,
deeds of trust, security agreements, financing statements, instruments, documents and other
agreements as Lender or Ex-Im Bank may reasonably request to evidence and secure the Loan, to
perfect the Liens or otherwise facilitate the performance of this Agreement, any of the other
Financing Documents and the Waiver Letter.



Section 6.12 Compliance Certificate. Unless waived in writing by Lender, provide
Lender within fifteen (15) days after the end of each calendar quarter with a certificate executed
by Borrower’s chief financial officer or other officer or person acceptable to Lender (a)
certifying that the representations and warranties set forth in this Agreement and the other
Financing Documents are true and correct as of the date of the certificate and that, as of the date
of the certificate, no Event of Default exists under this Agreement, and (b) demonstrating
compliance with all covenants set forth in this Agreement, including the Incorporated Covenants.


 


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ARTICLE VII

INCORPORATED COVENANTS




Borrower covenants and agrees with Lender that, while this Agreement is in effect and until
all of Borrowers’ Obligations are fully paid and performed, Borrower shall further perform and
observe all of the covenants (the “Incorporated Covenants”) set forth in the Domestic
Credit Agreements.



ARTICLE VIII

EVENTS OF DEFAULT; REMEDIES




Section 8.1 Events of Default. Each of the following shall constitute an “Event
of Default” under this Agreement:



(a) Failure of Borrower to make any payment when due on any of Borrower’s Obligations,
including, without limitation, any mandatory prepayments of Borrower’s Obligations from the
Proceeds of or comprising Export-Related Accounts Receivable and such failure shall continue for
five (5) days;



(b) Failure of Borrower to comply with or to perform when due any other term, obligation,
covenant or condition contained in this Agreement, the Note, the Borrower Agreement or in any of
the other Financing Documents which is not cured within fifteen (15) days;



(c) Failure of Borrower to pay when due any amount payable to Lender under any other loan or
credit accommodation to Borrower and such failure shall continue for a period of five (5) days;



(d) The occurrence of any default or event of default under any other agreement now existing
or hereafter arising between Lender and Borrower;



(e) Any warranty, representation or statement made in or furnished to Lender under this
Agreement or the other Financing Documents is false or misleading in any material respect when made
or furnished, or becomes false or misleading in any material respect at any time thereafter;



(f) The occurrence of any event which permits the acceleration of the maturity of any
indebtedness owing by Borrower to any third party under any agreement or undertaking, or any such
indebtedness shall not be paid as and when due;



(g) The occurrence of any event of default whether or not caused, directly or indirectly, by
actions or omissions of Borrower or any third party under any agreement or undertaking entered into
by Borrower, past any cure period provided thereon;


 


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(h) Borrower (i) applies for, consents to or suffers the appointment of, or the taking of
possession by, a receiver, custodian, trustee, liquidator or similar fiduciary of itself or of all
or a substantial part of its property or calls a meeting of its creditors, (ii) admits in writing
its inability, or is generally unable, to pay its debts as they become due or ceases operations of
its present business, (iii) makes a general assignment for the benefit of creditors, (iv)
commences a voluntary case under any state or federal bankruptcy laws (as now or hereafter in
effect), (v) is adjudicated as bankrupt or insolvent, (vi) files a petition seeking to take
advantage of any other law providing for the relief of debtors, (vii) acquiesces to, or fails to
have dismissed within thirty (30) days, any petition filed against it in any involuntary case under
such bankruptcy laws, (viii) is the subject of any proceeding for the liquidation of its assets or
dissolution, or (ix) takes any action for the purpose of effecting any of the foregoing.



(i) The Borrower becomes the subject of any merger or consolidation.



(j) Commencement of foreclosure or forfeiture proceedings, whether by judicial proceeding,
self-help, repossession or any other method, by any creditor of Borrower, or by any governmental
agency; or the issuance of any levy, assessment, attachment, seizure or Lien, other than a
Permitted Lien, against any of the Collateral which is not stayed or lifted within fifteen (15)
days.



(k) The occurrence of an event of default under the Ex-Im Bank Guarantee or the Ex-Im Bank
Guarantee ceases to be in effect for any reason whatsoever without Lender’s prior written consent,
including, without limitation, Borrower’s failure to pay all fees due Ex-Im Bank.



(l) Any material delay occurs in Borrower’s performance of its obligations under any Export
Order, unless such delay is due to force majeure and Borrower is able to satisfy Lender that the
delay will not cause a default under the applicable Export Order or diminish the Buyer’s payment
obligations thereunder; or a material adverse change occurs in the financial condition of any
supplier to Borrower.



(m) An event occurs which has had or could reasonably be expected to have a Material Adverse
Effect.



(n) Any Lien in any of the Collateral granted or intended by the Financing Documents to be
granted to Lender ceases to be a valid, enforceable, perfected, first priority Lien (or a lesser
priority if expressly permitted pursuant to Section 6 of the Loan Authorization Notice) subject
only to Permitted Liens.



(o) Any material provision of any Financing Document for any reason ceases to be valid,
binding and enforceable in accordance with its terms.



(p) Any litigation is filed against Borrower which has had or could reasonably be expected to
have a Material Adverse Effect and such litigation is not withdrawn or dismissed within thirty (30)
days of the filing thereof.




 


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 Section 8.2 Effect of an Event of Default. If any Event of Default shall occur, and
unless such Event of Default shall be cured to the satisfaction of Lender and Ex-Im Bank, Lender
may, at its option, without further notice or demand, (a) declare all Borrower’s Obligations
(contingent or otherwise) immediately due and payable; (b) refuse to make or incur any additional
Credit Accommodations under this Agreement or the Note; (d) assemble, sell, lease, buy, transfer or
otherwise dispose of the Collateral or the Proceeds thereof; and (e) exercise all the rights and
remedies provided in this Agreement, the Note, the Waiver Letter or in any of the other Financing Documents or available at law, in equity, or otherwise; provided, however,
that if any Event of Default of the type described in Section 8.1(f) shall occur, all Borrower’s
Obligations shall automatically become fully due and payable, without any notice, demand or action
by Lender. Except as may be prohibited by applicable law, all of Lender’s rights and remedies
shall be cumulative and may be exercised singularly or concurrently. Election by Lender to pursue
any remedy shall not exclude pursuit of any other remedy, and an election to make expenditures or
to take action to perform an obligation of Borrower shall not affect Lender’s right to declare a
default and to exercise its rights and remedies.



ARTICLE IX

MISCELLANEOUS




Section 9.1 Amendments. This Agreement, together with the other Financing Documents
and the Waiver Letter, constitute the entire understanding and agreement of the parties as to the
matters set forth in this Agreement. No alteration of or amendment to this Agreement shall be
effective unless given in writing and signed by the party or parties sought to be charged or bound
by the alteration or amendment. This Agreement, the other Financing Documents and the Waiver
Letter supersede all existing agreements, oral or written, previously entered into between Borrower
and Lender with respect to the Loan unless Borrower and Lender agree in writing to the contrary.



Section 9.2 Caption Headings. Caption headings in this Agreement are for convenience
purposes only and are not to be used to interpret or define the provisions of this Agreement.



Section 9.3 Consent to Loan Participation. Borrower agrees and consents to Lender’s
sale or transfer, at Lender’s sole discretion, whether now or later, of one or more participation
interests in the Loan to one or more purchasers, whether related or unrelated to Lender. Lender
may provide, without any limitation whatsoever, to any one or more purchasers, potential
purchasers, or affiliates of Lender, any information or knowledge Lender may have about Borrower or
about any other matter relating to the Loan, and Borrower hereby waives any rights to privacy it
may have with respect to such matters. Borrower additionally waives any and all notices of sale of
participation interests, as well as all notices of any repurchase of such participation interests.




 


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Section 9.4 Notices. All communications and notices required to be given under this
Agreement shall be hand delivered or sent by nationally recognized overnight courier or United
States mail, certified or registered, postage prepaid, addressed to the party to whom the notice is
to be given at the address shown below. All such communications and notices shall be effective
upon delivery. Any party may change its address for notices under this Agreement by giving formal
written notice to the other parties, specifying that the purpose of the notice is to change the
party’s address. To the extent permitted by applicable law, if there is more than one Borrower,
notice to any Borrower will constitute notice to all Borrowers:



if to Borrower:



FuelCell Energy, Inc.

3 Great Pasture Road

Danbury, CT 06813

Attention: Michael Bishop, VP and Corporate Controller



if to Lender:



JPMorgan Chase Bank, N.A.

Two Corporate Drive, Suite 730

Shelton, CT 06484

Attention: James Patrick Murphy



with copy to:



JPMorgan Chase Bank, N.A. — Global Trade Services

2200 Ross Ave., 6th Floor

Dallas, Texas 75201

Attention: Mr. Randall Mascorro



if to Ex-Im Bank:



Export-Import Bank of the United States

811 Vermont Avenue, N.W.

Washington, D.C. 20571

Attention: Vice President, Business Credit Division




Section 9.5 Survival. All covenants, agreements, representations and warranties of
Borrower made herein and in the other Financing Documents and in the certificates, instruments and
other documents delivered pursuant hereto or thereto shall survive the making or incurring of
Credit Accommodations hereunder, and shall continue in full force and effect until all of
Borrower’s Obligations have been paid and performed in full.



Section 9.6 Successors and Assigns. Whenever in this Agreement any of the parties
hereto is referred to, such reference shall be deemed to include the successors and permitted
assigns of such party; and all covenants, promises and agreements by or on behalf of Borrower which
are contained in this Agreement or in the other Financing Documents shall inure to the benefit of
the successors and assigns of Lender and Ex-Im Bank, which is a third-party beneficiary of this
Agreement and each of the other Financing Documents to which it is not a direct party. Borrower
may not assign any interest that it may have under this Agreement, including, without limitation,
the right to receive the benefit of the Loan to be extended hereunder, without the prior written
consent of Lender and Ex-Im Bank. Any assignment made or attempted by Borrower without the prior
written consent of Lender and Ex-Im Bank shall be void and of no effect. No consent by Lender and
Ex-Im Bank to an assignment by Borrower shall release Borrower as the party primarily obligated and
liable under the terms of this Agreement unless Borrower shall be released specifically by Lender
and Ex-Im Bank in writing.


 


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No consent by Lender and Ex-Im Bank to an assignment shall be deemed to be a waiver of the
requirement of prior written consent by Lender and Ex-Im Bank with respect to each and every
further assignment and as a condition precedent to the effectiveness of such assignment. Lender
may assign its interest in any or all of the Financing Documents or the Waiver Letter to any
Person, including Ex-Im Bank, without the consent of or notice to Borrower or any other Person,
upon such terms as Lender in its sole discretion deems appropriate.



Section 9.7 Payment of Fees and Expenses. Borrower shall pay all reasonable
out-of-pocket expenses, including, without limitation, the fees and disbursements of legal counsel
employed by Lender, incurred by Lender in connection with (a) the preparation and negotiation of
this Agreement, the Waiver Letter and the other Financing Documents, (b) the making or incurring of
Credit Accommodations by Lender, (c) the protection of the Collateral and any other security for
the repayment of Borrower’s Obligations, and (d) the enforcement and protection of the rights of
Lender in connection with this Agreement, the Waiver Letter or any of the other Financing
Documents. Prior to Lender’s making or incurring any Credit Accommodations hereunder, Borrower
shall pay to Lender, as an additional condition precedent to the making or incurring of Credit
Accommodations, the Ex-Im Bank facility fee determined in accordance with the Loan Authorization
Notice and all other fees and expenses due Lender. Without limiting the generality of the
foregoing, Borrower shall pay or cause to be paid to Lender the Ex-Im Bank application fee in the
amount of $100 and the Ex-Im Bank guarantee fee in the amount of $75,000, payable on the Effective
Date and at any renewal hereof.



Section 9.8 Applicable Law; Jurisdiction; Consent to Service of Process. Except as
hereinafter expressly provided, this Agreement is governed by and shall be construed in accordance
with the laws of the State of Connecticut. The Ex-Im Bank Guarantee is governed by New York law.
Accordingly, notwithstanding any provision to the contrary contained herein or in any of the other
Financing Documents, to the extent, but only to the extent, necessary to assure full satisfaction
of and compliance with all terms and conditions of Ex-Im Bank’s guaranty of Borrower’s Obligations
under the Ex-Im Bank Guarantee and to preserve Lender’s rights thereunder, this Agreement and each
of the other Financing Documents shall be governed by and construed in accordance with the laws of
the State of New York. Lender and Borrower hereby submit to the non-exclusive jurisdiction of any
Connecticut state court or federal court sitting in Connecticut over any suit, action or proceeding
arising out of or relating to this Agreement. Final judgment in any such suit, action or
proceeding brought in any such court shall be conclusive and binding upon Borrower and may be
enforced in any court to the jurisdiction of which Borrower is subject, by a suit upon the
judgment.



Section 9.9 No Liability of Lender. Neither Lender nor Ex-Im Bank shall be liable for
any act or omission by it pursuant to the provisions of this Agreement, in the absence of fraud or
gross negligence. Borrower hereby agrees that neither Lender nor Ex-Im Bank shall be chargeable
for any negligence, mistake, act or omission of any accountant, examiner, agency or attorney
employed by it in making examinations, investigations or collections, or otherwise in perfecting,
maintaining, protecting or realizing upon any lien or Security Interest in the Collateral or any
other interest in any security for Borrower’s Obligations. Neither Lender nor Ex-Im Bank shall
incur any liability to Borrower or to any other party in connection with the acts or omissions of
Lender or Ex-Im Bank in reliance upon any certificate or other paper believed by Lender or Ex-Im
Bank to be genuine or with respect to any other thing which Lender or Ex-Im
Bank may do or refrain from doing, unless such act or omission amounts to fraud or gross
negligence.


 


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Section 9.10 WAIVER OF SPECIAL DAMAGES. THE BORROWER WAIVES, TO THE MAXIMUM EXTENT NOT
PROHIBITED BY LAW, ANY RIGHT THE UNDERSIGNED MAY HAVE TO CLAIM OR RECOVER FROM THE BANK IN ANY
LEGAL ACTION OR PROCEEDING ANY SPECIAL, EXEMPLARY, PUNITIVE OR CONSEQUENTIAL DAMAGES.



Section 9.11 Indemnification. Borrower agrees to protect, indemnify, defend and hold
harmless Lender and Ex-Im Bank from and against any and all claims, damages, losses, liabilities,
costs or expenses (including, without limitation, attorneys’ fees AND ANY SUCH CLAIMS, DAMAGES,
LOSSES, LIABILITIES, COSTS OR EXPENSES INCURRED BY REASON OF THE LENDER’S OR EX-IM BANK’S OWN
NEGLIGENCE OR STRICT LIABILITY) whatsoever which Lender and Ex-Im Bank may, at any time, sustain or
incur by reason of or in consequence of or arising out of extending the Loan to Borrower, the
making or incurring of Credit Accommodations, or the issuance of a guaranty of Borrower’s
Obligations, as the case may be; it being the intention of the parties that this Agreement shall be
construed and applied to protect, indemnify, defend and hold harmless Lender and Ex-Im Bank against
any and all risks involved in the transactions contemplated by this Agreement, the Waiver Letter
and the other Financing Documents, all of which risks are hereby assumed by Borrower. The
provisions of this Section shall survive the expiration or termination of this Agreement, the
Waiver Letter, the other Financing Documents, and the payment and performance of Borrower’s
Obligations.



Section 9.12 Authorization for Direct Payments (ACH Debits). To effectuate any
payment due under this Agreement, the Note or any other Financing Document, Borrower hereby
authorizes Lender to initiate debit entries to any deposit account of Borrower maintained with
Lender and to debit the same to such account. This authorization to initiate debit entries shall
remain in full force and effect until Lender has received written notification of its termination
in such time and in such manner as to afford Lender a reasonable opportunity to act on it. Borrower
acknowledges (a) that such debit entries may cause an overdraft of any such account which may
result in Lender’s refusal to honor items drawn on any such account until adequate deposits are
made to any such account; (b) that Lender is under no duty or obligation to initiate any debit
entry for any purpose; and (c) that if a debit is not made because any such account does not have a
sufficient available balance, or otherwise, the payments may be late or past due.



Section 9.13 No Partnership. Nothing contained in this Agreement shall be construed
in a manner to create any relationship among Borrower, Lender and Ex-Im Bank other than the
relationship of borrower, lender and credit enhancement provider, and Borrower, Lender and Ex-Im
Bank shall not be considered partners or co-venturers for any purpose on account of this Agreement.



Section 9.14 Controlling Agreement. Borrower acknowledges and agrees that (a) the
Borrower Agreement contains additional representations, terms, covenants and conditions related to
Borrower and the Loan, and (b) as between Lender and Borrower this Agreement and the Borrower
Agreement together govern the establishment of the Loan as a Loan Facility
guaranteed pursuant to the Ex-Im Bank Guarantee and the making and incurring of Credit
Accommodations under the Loan. In the event any of the representations, terms, covenants or
conditions contained in this Agreement conflict with those contained in the Borrower Agreement,
then as between Lender and Borrower, the more stringent provisions of each with respect to Borrower
shall govern and prevail.


 


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Section 9.15 USA PATRIOT ACT NOTIFICATION. The following notification is provided to
Borrowers pursuant to Section 326 of the USA Patriot Act of 2001, 31 U.S.C. Section 5318:
IMPORTANT INFORMATION ABOUT PROCEDURES FOR OPENING A NEW ACCOUNT. To help the government
fight the funding of terrorism and money laundering activities, Federal law requires all financial
institutions to obtain, verify, and record information that identifies each person or entity that
opens an account, including any deposit account, treasury management account, loan, other extension
of credit, or other financial services product. What this means for Borrowers: When any Borrower
opens an account, if any Borrower is an individual Lender will ask for such Borrower’s name,
taxpayer identification number, residential address, date of birth, and other information that will
allow Lender to identify such Borrower, and if any Borrower is not an individual Lender will ask
for such Borrower’s name, taxpayer identification number, business address, and other information
that will allow Lender to identify such Borrower. Lender may also ask, if any Borrower is an
individual to see such Borrower’s driver’s license or other identifying documents, and if any
Borrower is not an individual to see such Borrower’s legal organizational documents or other
identifying documents.



Section 9.16 Waiver of Trial by Jury. EACH OF BORROWER AND LENDER HEREBY VOLUNTARILY,
KNOWINGLY, IRREVOCABLY AND UNCONDITIONALLY WAIVES TRIAL BY JURY IN ANY ACTION OR PROCEEDING
(WHETHER BASED ON CONTRACT, TORT, OR OTHERWISE), TO WHICH BORROWER AND LENDER MAY BE PARTIES
ARISING OUT OF OR IN ANY WAY PERTAINING OR RELATED TO THIS AGREEMENT, THE WAIVER LETTER OR ANY OF
THE OTHER FINANCING DOCUMENTS. IT IS AGREED AND UNDERSTOOD THAT THIS WAIVER CONSTITUTES A WAIVER
OF TRIAL BY JURY OF ALL CLAIMS AGAINST ALL PARTIES TO SUCH ACTIONS OR PROCEEDINGS, INCLUDING CLAIMS
AGAINST PARTIES WHO ARE NOT PARTIES TO THIS AGREEMENT. THIS WAIVER IS KNOWINGLY, WILLINGLY AND
VOLUNTARILY MADE BY EACH OF BORROWER AND LENDER, AND BORROWER HEREBY REPRESENTS THAT NO
REPRESENTATIONS OF FACT OR OPINION HAVE BEEN MADE BY ANY PERSON TO INDUCE THIS WAIVER OF TRIAL BY
JURY OR TO IN ANY WAY MODIFY OR NULLIFY ITS EFFECT. BORROWER FURTHER REPRESENTS THAT IT HAS HAD
THE OPPORTUNITY TO BE REPRESENTED IN THE SIGNING OF THIS AGREEMENT AND IN THE MAKING OF THIS WAIVER
BY INDEPENDENT LEGAL COUNSEL, SELECTED OF ITS OWN FREE WILL, AND THAT IT HAS HAD THE OPPORTUNITY TO
DISCUSS THIS WAIVER WITH COUNSEL. THIS PROVISION IS A MATERIAL INDUCEMENT TO THE LENDER TO PROVIDE
THE FINANCING HEREUNDER.



Section 9.17 Severability. If a court of competent jurisdiction finds any provision
of this Agreement to be invalid or unenforceable as to any person or circumstance, such finding
shall not render that provision invalid or unenforceable as to any other persons or circumstances.
If feasible, any such offending provision shall be deemed to be modified to be within the limits
of enforceability or validity, however, if the offending provision cannot be so modified, it
shall be stricken and all other provisions of this Agreement in all other respect shall remain
valid and enforceable.


 


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Section 9.18 Rules of Construction. For purposes of this Agreement, the following
additional rules of construction shall apply, unless specifically indicated to the contrary: (a)
wherever from the context it appears appropriate, each term stated in either the singular or plural
shall include the singular and the plural, and pronouns stated in the masculine, feminine or neuter
gender shall include the masculine, the feminine and the neuter; (b) the term “or” is not
exclusive; (c) the term “including” (or any form thereof) shall not be limiting or exclusive; (d)
all references to statutes and related regulations shall include any amendments of same and any
successor statutes and regulations; (e) the words “this Agreement”, “herein”, “hereof”, “hereunder”
or other words of similar import refer to this Agreement as a whole including the exhibits hereto
as the same may be amended, modified or supplemented; (f) all references in this Agreement to
sections, subsections, paragraphs and exhibits shall refer to the corresponding sections,
subsections, paragraphs and exhibits of or to this Agreement; and (g) all references to any
instruments or agreements, including references to the Waiver Letter or any of the Financing
Documents, shall include any and all modifications, amendments and supplements thereto and any and
all restatements, extensions or renewals thereof to the extent permitted under this Agreement.



Section 9.19 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which together shall constitute
the same document. Signature pages may be detached from the counterparts to a single copy of this
Agreement to physically form one document.



Section 9.20 Time is of the Essence. Time is of the essence in the performance of
this Agreement.



Section 9.21 Waiver. Lender shall not be deemed to have waived any rights under this
Agreement unless such waiver is given in writing and signed by Lender. No delay or omission on the
part of Lender in exercising any right shall operate as a waiver of such right or any other right.
A waiver by Lender of a provision of this Agreement shall not prejudice or constitute a waiver of
Lender’s right otherwise to demand strict compliance with that provision or any other provision of
this Agreement. No prior waiver by Lender, nor any course of dealing between Lender and Borrower,
or between Lender, shall constitute a waiver of any of Lender’s rights or of any obligations of
Borrower as to any future transactions. Whenever the consent of Lender is required under this
Agreement, the granting of such consent by Lender in any instance shall not constitute continuing
consent in subsequent instances where such consent is required, and in all cases such consent may
be granted or withheld in the sole discretion of Lender.



Section 9.22 Usury not Intended. Borrower and Lender intend to conform strictly to
applicable usury laws. Therefore, the total amount of interest (as defined under applicable law)
contracted for, charged or collected under this Agreement or any other Loan Document will never
exceed the Highest Lawful Rate. If Lender contracts for, charges or receives any excess interest,
it will be deemed a mistake. Lender will automatically reform the Loan Document or charge to
conform to applicable law, and if excess interest has been received, Lender will either
refund the excess to Borrower or credit the excess on any unpaid principal amount of the Note
or any other Loan Document. All amounts constituting interest will be spread throughout the full
term of the Loan Document or applicable Note in determining whether interest exceeds lawful
amounts.


 


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Section 9.23 ENTIRE AGREEMENT. THIS WRITTEN AGREEMENT AND THE FINANCING DOCUMENTS
REPRESENT THE FINAL AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.



THERE ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.




[Remainder of this page intentionally left blank]



 


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	EXECUTED as of the date first above written.	 	 
	 
	 	 	 	 
	BORROWER:	 	 
	 
	 	 	 	 
	FUELCELL ENERGY, INC.	 	 
	 
	 	 	 	 
	By:
	 	/s/ Joseph G. Mahler	 	 
	Name:

	 	 
Joseph G. Mahler
	 	 
	Title:

	 	 
Sr.
Vice President & CFO
	 	 
	 

	 	 

	 	 
	 
	 	 	 	 
	LENDER:	 	 
	 
	 	 	 	 
	JPMORGAN CHASE BANK, N.A.	 	 
	 
	 	 	 	 
	By:
	 	/s/ James P. Murphy	 	 
	Name:

	 	 
James P. Murphy
	 	 
	Title:

	 	 
Authorized
Signer
	 	 
	 

	 	 

	 	 
	 
	 	 	 	 
	JPMORGAN CHASE BANK, N.A. — GLOBAL TRADE SERVICES	 	 
	 
	 	 	 	 
	By:
	 	/s/ Randall Mascorro	 	 
	Name:

	 	 

Randall Mascorro
	 	 
	Title:

	 	Vice President	 	 






[Signature Page To Export Loan Agreement]





 


 











 




EXHIBIT A




Export-Import Bank of the United States

Working Capital Guarantee Program




Borrower Agreement




Ex-Im Bank 12/31/05



 


 









 





TABLE OF CONTENTS




	 	 	 	 	 
	ARTICLE I DEFINITIONS
	 	 	1	 
	 
	1.01 Definition of Terms
	 	 	1	 
	1.02 Rules of Construction
	 	 	14	 
	1.03 Incorporation of Recitals
	 	 	15	 
	 
	ARTICLE II OBLIGATIONS OF BORROWER
	 	 	15	 
	2.01 Use of Credit Accommodations
	 	 	15	 
	2.02 Security Interests
	 	 	15	 
	2.03 Loan Documents and Loan Authorization Agreement
	 	 	16	 
	2.04 Export-Related Borrowing Base Certificates and Export Orders
	 	 	16	 
	2.05 Schedules, Reports and Other Statements
	 	 	16	 
	2.06 Exclusions from the Export-Related Borrowing Base
	 	 	16	 
	2.07 Borrowings and Reborrowings
	 	 	17	 
	2.08 Repayment Terms
	 	 	17	 
	2.09 Financial Statements
	 	 	17	 
	2.10 Additional Security or Payment
	 	 	17	 
	2.11 Continued Security Interest
	 	 	18	 
	2.12 Inspection of Collateral and Facilities
	 	 	18	 
	2.13 General Intangibles
	 	 	19	 
	2.14 Economic Impact Approval
	 	 	19	 
	2.15 Indirect Exports
	 	 	20	 
	2.16 Overseas Inventory and Accounts Receivable
	 	 	20	 
	2.17 Country Limitation Schedule
	 	 	21	 
	2.18 Notice of Certain Event
	 	 	21	 
	2.19 Insurance
	 	 	22	 
	2.20 Taxes
	 	 	22	 
	2.21 Compliance with Laws
	 	 	22	 
	2.22 Negative Covenants
	 	 	22	 
	2.23 Cross Default
	 	 	22	 
	2.24 Munitions List
	 	 	22	 
	2.25 Suspension and Debarment, etc
	 	 	23	 





Ex-Im Bank 12/31/05



 


i









 





	 	 	 	 	 
	ARTICLE III RIGHTS AND REMEDIES
	 	 	23	 
	3.01 Indemnification
	 	 	23	 
	3.02 Liens
	 	 	23	 
	 
	ARTICLE IV MISCELLANEOUS
	 	 	24	 
	4.01 Governing Law
	 	 	24	 
	4.02 Notification
	 	 	24	 
	4.03 Partial Invalidity
	 	 	24	 
	4.04 Waiver of Jury Trial
	 	 	24	 
	4.05 Consequential Damages
	 	 	24	 





Ex-Im Bank 12/31/05



 


ii









 





Export-Import Bank of the United States

Working Capital Guarantee Program

Borrower Agreement




THIS BORROWER AGREEMENT (this “Agreement”) is made and entered into by the entity identified
as Borrower on the signature page hereof (“Borrower”) in favor of the Export-Import Bank of the
United States (“Ex-Im Bank”) and the institution identified as Lender on the signature page hereof
(“Lender”).



RECITALS




Borrower has requested that Lender establish a Loan Facility in favor of Borrower for the
purposes of providing Borrower with working capital to finance the manufacture, production or
purchase and subsequent export sale of Items.



Lender and Borrower expect that Ex-Im Bank will provide a guarantee to Lender regarding this
Loan Facility subject to the terms and conditions of the Master Guarantee Agreement, a Loan
Authorization Agreement, and to the extent applicable, the Delegated Authority Letter Agreement or
Fast Track Lender Agreement.



Lender and Ex-Im Bank have requested that Borrower execute this Agreement as a condition
precedent to Lender establishing the Loan Facility and Ex-Im Bank providing the guarantee.




NOW, THEREFORE, Borrower hereby agrees as follows:



ARTICLE I

DEFINITIONS




1.01 Definition of Terms. As used in this Agreement, including the Recitals to this
Agreement and the Loan Authorization Agreement, the following terms shall have the following
meanings:



“Accounts Receivable” shall mean all of Borrower’s now owned or hereafter acquired
(a) “accounts” (as such term is defined in the UCC), other receivables, book debts and other forms
of obligations, whether arising out of goods sold or services rendered or from any other
transaction; (b) rights in, to and under all purchase orders or receipts for goods or services; (c)
rights to any goods represented or purported to be represented by any of the foregoing (including
unpaid sellers’ rights of rescission, replevin, reclamation and stoppage in transit and rights to
returned, reclaimed or repossessed goods); (d) moneys due or to become due to such Borrower under
all purchase orders and contracts (which includes Export Orders) for the sale of goods or the
performance of services or both by Borrower (whether or not yet earned by performance on the part
of Borrower), including the proceeds of the foregoing; (e) any notes, drafts, letters of credit,
insurance proceeds or other instruments, documents and writings evidencing or supporting the
foregoing; and (f) all collateral security and guarantees of any kind given by any other Person
with respect to any of the foregoing.



Ex-Im Bank 12/31/05



 


 









 





“Accounts Receivable Aging Report” shall mean a report detailing the Export-Related Accounts
Receivable and Export-Related Overseas Accounts Receivable for a Loan Facility, and the applicable
terms for the relevant time period; in the case of Indirect Exports, such report shall indicate the
portion of such Accounts Receivables corresponding to Indirect Exports.



“Advance Rate” shall mean, with respect to a Loan Facility, the rate specified in Section 5.C.
of the Loan Authorization Agreement for each category of Primary Collateral except for
Export-Related General Intangibles and Other Collateral. Unless otherwise set forth in writing by
Ex-Im Bank, in no event shall the Advance Rate exceed (i) ninety percent (90%) for Eligible
Export-Related Accounts Receivable, (ii) seventy five percent (75%) for Eligible Export-Related
Inventory, (iii) seventy percent (70%) for Eligible Export-Related Overseas Accounts Receivable or
(iv) sixty percent (60%) for Eligible Export-Related Overseas Inventory and (v) twenty five percent
(25%) for Retainage Accounts Receivable.




“Affiliated Foreign Person” shall have the meaning set forth in Section 2.15.



“Business Day” shall mean any day on which the Federal Reserve Bank of New York is open for
business.



“Buyer” shall mean a Person that has entered into one or more Export Orders with Borrower or
who is an obligor on Export-Related Accounts Receivable or Export-Related Overseas Accounts
Receivable.



“Capital Good” shall mean a capital good (e.g., manufacturing equipment, licensing agreements)
that will establish or expand foreign production capacity of an exportable good.



“Collateral” shall mean all real and personal property and interest in real and personal
property in or upon which Lender has been, or shall be, granted a Lien as security for the payment
of all the Loan Facility Obligations and all products and proceeds (cash and non-cash) thereof.



“Commercial Letters of Credit” shall mean those letters of credit subject to the UCP payable
in Dollars and issued or caused to be issued by Lender on behalf of Borrower under a Loan Facility
for the benefit of a supplier(s) of Borrower in connection with Borrower’s purchase of goods or
services from the supplier in support of the export of the Items.



“Country Limitation Schedule” shall mean the schedule published from time to time by Ex-Im
Bank setting forth on a country by country basis whether and under what conditions Ex-Im Bank will
provide coverage for the financing of export transactions to countries listed therein.



“Credit Accommodation Amount” shall mean, the sum of (a) the aggregate outstanding amount of
Disbursements and (b) the aggregate outstanding Letter of Credit Obligations, which sum may not
exceed the Maximum Amount.



“Credit Accommodations” shall mean, collectively, Disbursements and Letter of Credit
Obligations.


 


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“Debarment Regulations” shall mean, collectively, (a) the Governmentwide Debarment and
Suspension (Nonprocurement) regulations (Common Rule), 53 Fed. Reg. 19204 (May 26, 1988), (b)
Subpart 9.4 (Debarment, Suspension, and Ineligibility) of the Federal Acquisition Regulations, 48
C.F.R. 9.400-9.409 and (c) the revised Governmentwide Debarment and Suspension (Nonprocurement)
regulations (Common Rule), 60 Fed. Reg. 33037 (June 26, 1995).



“Delegated Authority Letter Agreement” shall mean the Delegated Authority Letter Agreement, if
any, between Ex-Im Bank and Lender.



“Disbursement” shall mean, collectively, (a) an advance of a working capital loan from Lender
to Borrower under the Loan Facility, and (b) an advance to fund a drawing under a Letter of Credit
issued or caused to be issued by Lender for the account of Borrower under the Loan Facility.




“Dollars” or “$” shall mean the lawful currency of the United States.



“Economic Impact Approval” shall mean a written approval issued by Ex-Im Bank stating the
conditions under which a Capital Good may be included as an Item in a Loan Facility consistent with
Ex-Im Bank’s economic impact procedures (or other mechanism for making this determination that
Ex-Im Bank notifies Lender of in writing).




“Economic Impact Certification” shall have the meaning set forth in Section 2.14(b).



“Effective Date” shall mean the date on which (a) all of the Loan Documents have been executed
by Lender, Borrower and, if applicable, Ex-Im Bank and (b) all of the conditions to the making of
the initial Credit Accommodations under the Loan Documents or any amendments thereto have been
satisfied.



“Eligible Export-Related Accounts Receivable” shall mean Export-Related Accounts Receivable
which are acceptable to Lender and which are deemed to be eligible pursuant to the Loan Documents,
but in no event shall Eligible Export-Related Accounts Receivable include any Account Receivable:




(a) that does not arise from the sale of Items in the ordinary course of Borrower’s business;




(b) that is not subject to a valid, perfected first priority Lien in favor of Lender;



(c) as to which any covenant, representation or warranty contained in the Loan Documents with
respect to such Account Receivable has been breached;



(d) that is not owned by Borrower or is subject to any right, claim or interest of another
Person other than the Lien in favor of Lender;




(e) with respect to which an invoice has not been sent;



(f) that arises from the sale of defense articles or defense services;


 


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(g) that arises from the sale of Items to be used in the construction, alteration, operation
or maintenance of nuclear power, enrichment, reprocessing, research or heavy water production
facilities unless with Ex-Im Bank’s prior written consent;



(h) that is due and payable from a Buyer located in a country with which Ex-Im Bank is
prohibited from doing business as designated in the Country Limitation Schedule;




(i) that does not comply with the requirements of the Country Limitation Schedule;



(j) that is due and payable more than one hundred eighty (180) days from the date of the
invoice;



(k) that is not paid within sixty (60) calendar days from its original due date, unless it is
insured through Ex-Im Bank export credit insurance for comprehensive commercial and political risk,
or through Ex-Im Bank approved private insurers for comparable coverage, in which case it is not
paid within ninety (90) calendar days from its due date;



(l) of a Buyer for whom fifty percent (50%) or more of the Accounts Receivable of such Buyer
do not satisfy the requirements of subclauses (j) and (k) above;



(m) that arises from a sale of goods to or performance of services for an employee of
Borrower, a stockholder of Borrower, a subsidiary of Borrower, a Person with a controlling interest
in Borrower or a Person which shares common controlling ownership with Borrower;



(n) that is backed by a letter of credit unless the Items covered by the subject letter of
credit have been shipped;




(o) that Lender or Ex-Im Bank, in its reasonable judgment, deems uncollectible for any reason;



(p) that is due and payable in a currency other than Dollars, except as may be approved in
writing by Ex-Im Bank;



(q) that is due and payable from a military Buyer, except as may be approved in writing by
Ex-Im Bank;



(r) that does not comply with the terms of sale set forth in Section 7 of the Loan
Authorization Agreement;



(s) that is due and payable from a Buyer who (i) applies for, suffers, or consents to the
appointment of, or the taking of possession by, a receiver, custodian, trustee or liquidator of
itself or of all or a substantial part of its property or calls a meeting of its creditors, (ii)
admits in writing its inability, or is generally unable, to pay its debts as they become due or
ceases operations of its present business, (iii) makes a general assignment for the benefit of
creditors, (iv) commences a voluntary case under any state or federal bankruptcy laws (as now or
hereafter in effect), (v) is adjudicated as bankrupt or insolvent, (vi) files a petition seeking to
take advantage of any other law providing for the relief of debtors, (vii) acquiesces to, or fails
to have
dismissed, any petition which is filed against it in any involuntary case under such
bankruptcy laws, or (viii) takes any action for the purpose of effecting any of the foregoing;


 


4









 





(t) that arises from a bill-and-hold, guaranteed sale, sale-and-return, sale on approval,
consignment or any other repurchase or return basis or is evidenced by chattel paper;



(u) for which the Items giving rise to such Accounts Receivable have not been shipped to the
Buyer or when the Items are services, such services have not been performed or when the Export
Order specifies a timing for invoicing the Items other than shipment or performance and the Items
have not been invoiced in accordance with such terms of the Export Order, or the Accounts
Receivable otherwise do not represent a final sale;



(v) that is subject to any offset, deduction, defense, dispute, or counterclaim or the Buyer
is also a creditor or supplier of Borrower or the Account Receivable is contingent in any respect
or for any reason;



(w) for which Borrower has made any agreement with the Buyer for any deduction therefrom,
except for discounts or allowances made in the ordinary course of business for prompt payment, all
of which discounts or allowances are reflected in the calculation of the face value of each
respective invoice related thereto;



(x) for which any of the Items giving rise to such Account Receivable have been returned,
rejected or repossessed;



(y) that is included as an eligible receivable under any other credit facility to which
Borrower is a party;



(z) any of the Items giving rise to such Accounts Receivable are Capital Goods, unless the
transaction is in accordance with Section 2.14;



(aa) that is due and payable from a Buyer that is, or is located in, the United States;
provided however, that this subsection (aa) shall not preclude an Export-Related Accounts
Receivable arising from the sale of Items to foreign contractors or subcontractors providing
services to a United States Embassy or the United States Military located overseas from being
deemed an Eligible Export-Related Accounts Receivable; or



(bb) that arises from the sale of Items that do not meet the U.S. Content requirements in
accordance with Section 2.01(b)(ii).



“Eligible Export-Related Inventory” shall mean Export-Related Inventory which is acceptable to
Lender and which is deemed to be eligible pursuant to the Loan Documents, but in no event shall
Eligible Export-Related Inventory include any Inventory:




(a) that is not subject to a valid, perfected first priority Lien in favor of Lender;



(b) that is located at an address that has not been disclosed to Lender in writing;


 


5









 





(c) that is placed by Borrower on consignment or held by Borrower on consignment from another
Person;



(d) that is in the possession of a processor or bailee, or located on premises leased or
subleased to Borrower, or on premises subject to a mortgage in favor of a Person other than Lender,
unless such processor or bailee or mortgagee or the lessor or sublessor of such premises, as the
case may be, has executed and delivered all documentation which Lender shall require to evidence
the subordination or other limitation or extinguishment of such Person’s rights with respect to
such Inventory and Lender’s right to gain access thereto;



(e) that is produced in violation of the Fair Labor Standards Act or subject to the “hot
goods” provisions contained in 29 U.S.C.§215 or any successor statute or section;



(f) as to which any covenant, representation or warranty with respect to such Inventory
contained in the Loan Documents has been breached;



(g) that is not located in the United States unless expressly permitted by Lender, on terms
acceptable to Lender;



(h) that is an Item or is to be incorporated into Items that do not meet U.S. Content
requirements in accordance with Section 2.01(b)(ii);




(i) that is demonstration Inventory;



(j) that consists of proprietary software (i.e. software designed solely for Borrower’s
internal use and not intended for resale);




(k) that is damaged, obsolete, returned, defective, recalled or unfit for further processing;




(l) that has been previously exported from the United States;



(m) that constitutes, or will be incorporated into Items that constitute, defense articles or
defense services;



(n) that is an Item or will be incorporated into Items that will be used in the construction,
alteration, operation or maintenance of nuclear power, enrichment, reprocessing, research or heavy
water production facilities unless with Ex-Im Bank’s prior written consent;



(o) that is an Item or is to be incorporated into Items destined for shipment to a country as
to which Ex-Im Bank is prohibited from doing business as designated in the Country Limitation
Schedule;



(p) that is an Item or is to be incorporated into Items destined for shipment to a Buyer
located in a country in which Ex-Im Bank coverage is not available for commercial reasons as
designated in the Country Limitation Schedule, unless and only to the extent that such Items are to
be sold to such country on terms of a letter of credit confirmed by a bank acceptable to Ex-Im
Bank;


 


6









 





(q) that constitutes, or is to be incorporated into, Items whose sale would result in an
Accounts Receivable which would not be an Eligible Export-Related Accounts Receivable;



(r) that is included as eligible inventory under any other credit facility to which Borrower
is a party; or



(s) that is, or is to be incorporated into, an Item that is a Capital Good, unless the
transaction is in accordance with Section 2.14.



“Eligible Export-Related Overseas Accounts Receivable” shall mean Export-Related Overseas
Accounts Receivable which are acceptable to Lender and which are deemed to be eligible pursuant to
the Loan Documents but in no event shall include the Accounts Receivable (a) through (bb) excluded
from the definition of Eligible Export-Related Accounts Receivable.



“Eligible Export-Related Overseas Inventory” shall mean Export-Related Overseas Inventory
which is acceptable to Lender and which is deemed to be eligible pursuant to the Loan Documents,
but in no event shall include the Inventory (a) through (r) excluded from the definition of
Eligible Export-Related Inventory.



“Eligible Person” shall mean a sole proprietorship, partnership, limited liability
partnership, corporation or limited liability company which (a) is domiciled, organized or formed,
as the case may be, in the United States, whether or not such entity is owned by a foreign national
or foreign entity; (b) is in good standing in the state of its formation or otherwise authorized to
conduct business in the United States; (c) is not currently suspended or debarred from doing
business with the United States government or any instrumentality, division, agency or department
thereof; (d) exports or plans to export Items; (e) operates and has operated as a going concern for
at least one (1) year; (f) has a positive tangible net worth determined in accordance with GAAP;
and (g) has revenue generating operations relating to its core business activities for at least one
year. An Affiliated Foreign Person that meets all of the requirements of the foregoing definition
of Eligible Person other than subclause (a) thereof shall be deemed to be an Eligible Person



“ERISA” shall mean the Employee Retirement Income Security Act of 1974 and the rules and
regulations promulgated thereunder.



“Export Order” shall mean a documented purchase order or contract evidencing a Buyer’s
agreement to purchase the Items from Borrower for export from the United States, which
documentation shall include written information that is necessary to confirm such purchase order or
contract, including identification of the Items, the name of the Buyer, the country of destination,
contact information for the Buyer and the total amount of the purchase order or contract; in the
case of Indirect Exports, such documentation shall further include a copy of the written purchase
order or contract from a foreign purchaser or other documentation clearly evidencing a foreign
purchaser’s agreement to purchase the Items.



“Export-Related Accounts Receivable” shall mean those Accounts Receivable arising from the
sale of Items which are due and payable to Borrower in the United States.


 


7









 





“Export-Related Accounts Receivable Value” shall mean, at the date of determination thereof,
the aggregate face amount of Eligible Export-Related Accounts Receivable less taxes, discounts,
credits, allowances and Retainages, except to the extent otherwise permitted by Ex-Im Bank in
writing.



“Export-Related Borrowing Base” shall mean, at the date of determination thereof, the sum of
(a) (if Lender elects to include) the Export-Related Inventory Value or Export-Related Historical
Inventory Value multiplied by the Advance Rate applicable to Eligible Export-Related Inventory set
forth in Section 5.B.(1.) of the Loan Authorization Agreement, plus (b) the Export-Related Accounts
Receivable Value multiplied by the Advance Rate applicable to Eligible Export-Related Accounts
Receivable set forth in Section 5.B.(2.) of the Loan Authorization Agreement, plus (c) if permitted
by Ex-Im Bank in writing, the Retainage Value multiplied by the Advance Rate applicable to
Retainages set forth in Section 5.B.(3.) of the Loan Authorization Agreement, plus (d) the Other
Assets set forth in Section 5.B.(4.) of the Loan Authorization Agreement multiplied by the Advance
Rate agreed to in writing by Ex-Im Bank, plus (e) if permitted by Ex-Im Bank in writing, the
Export-Related Overseas Accounts Receivable Value multiplied by the Advance Rate applicable to
Eligible Export-Related Overseas Accounts Receivable set forth in Section 5.B.(5.) of the Loan
Authorization Agreement, plus (f) if permitted by Ex-Im Bank in writing, the Export-Related
Overseas Inventory Value multiplied by the Advance Rate applicable to Eligible Export-Related
Overseas Inventory set forth in Section 5.B.(6.) of the Loan Authorization Agreement, less (g) the
amounts required to be reserved pursuant to Sections 4.12 and 4.13 of this Agreement for each
outstanding Letter of Credit, less (h) such reserves and in such amounts deemed necessary and
proper by Lender from time to time.



“Export-Related Borrowing Base Certificate” shall mean a certificate in the form provided or
approved by Lender, executed by Borrower and delivered to Lender pursuant to the Loan Documents
detailing the Export-Related Borrowing Base supporting the Credit Accommodations which reflects, to
the extent included in the Export-Related Borrowing Base, Export-Related Accounts Receivable,
Eligible Export-Related Accounts Receivable, Export-Related Inventory, Eligible Export-Related
Inventory, Export-Related Overseas Accounts Receivable, Eligible Export-Related Accounts
Receivable, Export-Related Overseas Inventory and Eligible Export-Related Overseas Inventory
balances that have been reconciled with Borrower’s general ledger, Accounts Receivable Aging Report
and Inventory schedule.



“Export-Related General Intangibles” shall mean the Pro Rata Percentage of General Intangibles
determined as of the earlier of: (i) the date such General Intangibles are liquidated and (ii) the
date Borrower fails to pay when due any outstanding amount of principal or accrued interest payable
under the Loan Documents that becomes the basis for a Payment Default on which a Claim is filed.



“Export-Related Historical Inventory Value” shall mean with respect to a Borrower, the
relevant Export-Related Sales Ratio multiplied by the lowest of (i) the cost of such Borrower’s
Inventory as determined in accordance with GAAP, or (ii) the market value of such Borrower’s
Inventory as determined in accordance with GAAP or (iii) the appraised or orderly liquidation value
of such Borrower’s Inventory, if Lender has loans and financial accommodations to such Borrower for
which it conducts (or contracts for the performance of) such an appraised or orderly liquidation
value.


 


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“Export-Related Inventory” shall mean the Inventory of Borrower located in the United States
that has been purchased, manufactured or otherwise acquired by Borrower for sale or resale as
Items, or to be incorporated into Items to be sold or resold pursuant to Export Orders.



“Export-Related Inventory Value” shall mean, at the date of determination thereof, the lowest
of (i) the cost of Eligible Exported-Related Inventory as determined in accordance with GAAP, or
(ii) the market value of Eligible Export-Related Inventory as determined in accordance with GAAP or
(iii) the lower of the appraised market value or orderly liquidation value of the Eligible
Export-Related Inventory, if Lender has other loans and financial accommodations to a Borrower for
which it conducts (or contracts for the performance of) such an appraised or orderly liquidation
value.



“Export-Related Overseas Accounts Receivable” shall mean those Accounts Receivable arising
from the sale of Items which are due and payable outside of the United States either to a Borrower
or an Affiliated Foreign Person.



“Export-Related Overseas Accounts Receivable Value” shall mean, with respect to a Loan
Facility, at the date of determination thereof, the aggregate face amount of Eligible
Export-Related Overseas Accounts Receivable less taxes, discounts, credits, allowances and
Retainages, except to the extent otherwise permitted by Ex-Im Bank in writing.



“Export-Related Overseas Inventory” shall mean the Inventory of Borrower located outside of
the United States that has been purchased, manufactured or otherwise acquired by such Borrower for
sale or resale as Items, or to be incorporated into Items to be sold or resold pursuant to Export
Orders.



“Export-Related Overseas Inventory Value” shall mean, at the date of determination thereof,
the lowest of (i) the cost of Eligible Export-Related Overseas Inventory as determined in
accordance with GAAP, (ii) the market value of Eligible Export-Related Overseas Inventory as
determined in accordance with GAAP or (iii) the appraised or orderly liquidation value of the
Eligible Export-Related Overseas Inventory, if Lender has other loans and financial accommodations
to Borrower or an Affiliated Foreign Person for which it conducts (or contracts for the performance
of) such a appraised or orderly liquidation.



“Export-Related Sales Ratio” shall mean with respect to a Borrower, the percentage of such
Borrower’s total sales revenue derived from the sale of Eligible Export-Related Inventory over a
rolling twelve-month period ending no more than ninety (90) days prior to the date of the relevant
Export-Related Borrowing Base Certificate



“Extension” shall mean, with respect to a Loan Facility, an amendment to the Loan
Authorization Agreement extending the Final Disbursement Date on the same terms and conditions as
the Loan Facility for an aggregate period not to exceed one hundred and twenty (120) days beyond
the original Final Disbursement Date, either as agreed to in writing by Ex-Im Bank or, in the case
of Delegated Authority, as notified by Lender to Ex-Im Bank pursuant to its authority under the
Delegated Authority Letter Agreement.


 


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“Fast Track Lender Agreement” shall mean the Fast Track Lender Agreement, if any, between
Ex-Im Bank and Lender.



“Final Disbursement Date” shall mean the last date on which Lender may make a Disbursement set
forth in Section 10 of the Loan Authorization Agreement (including as amended by an Extension) or,
if such date is not a Business Day, the next succeeding Business Day; provided,
however, to the extent that Lender has not received cash collateral in the amount of the
Letter of Credit Obligations or an equivalent full indemnity from Borrower or Guarantor, as
applicable, with respect to Letter of Credit Obligations outstanding on the Final Disbursement
Date, the Final Disbursement Date with respect to an advance to fund a drawing under such Letter of
Credit shall be no later than thirty (30) days after any such drawing which may be no later than
the expiry date of the Letter of Credit related thereto.




“GAAP” shall mean the generally accepted accounting principles issued in the United States.



“General Intangibles” shall mean all intellectual property and other “general intangibles” (as
such term is defined in the UCC).



“Guarantor” shall mean any Person which is identified in Section 3 of the Loan Authorization
Agreement who shall guarantee (jointly and severally if more than one) the payment and performance
of all or a portion of the Loan Facility Obligations.



“Guarantee Agreement” shall mean a valid and enforceable agreement of guarantee executed by
each Guarantor in favor of Lender.



“Indirect Exports” shall mean finished goods or services that are sold by a Borrower to a
Buyer located in the United States, are intended for export from the United States, and are
identified in Section 4.A.(2.) of the Loan Authorization Agreement.



“Inventory” shall mean all “inventory” (as such term is defined in the UCC), now or hereafter
owned or acquired by Borrower, wherever located, including all inventory, merchandise, goods and
other personal property which are held by or on behalf of Borrower for sale or lease or are
furnished or are to be furnished under a contract of service or which constitute raw materials,
work in process or materials used or consumed or to be used or consumed in Borrower’s business or
in the processing, production, packaging, promotion, delivery or shipping of the same, including
other supplies.



“ISP” shall mean the International Standby Practices-ISP98, International Chamber of Commerce
Publication No. 590 and any amendments and revisions thereof.



“Issuing Bank” shall mean the bank that issues a Letter of Credit, which bank is Lender itself
or a bank that Lender has caused to issue a Letter of Credit by way of a guarantee or reimbursement
obligation.



“Items” shall mean the finished goods or services which are intended for export from the
United States, either directly or as an Indirect Export, meet the U.S. Content requirements in
accordance with Section 2.01(b)(ii) of this Agreement and are specified in Section 4.A. of the
Loan Authorization Agreement.


 


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“Letter of Credit” shall mean a Commercial Letter of Credit or a Standby Letter of Credit.



“Letter of Credit Obligations” shall mean all undrawn amounts of outstanding obligations
incurred by Lender, whether direct or indirect, contingent or otherwise, due or not due, in
connection with the issuance or guarantee by Lender or Issuing Bank of Letters of Credit.



“Lien” shall mean any mortgage, security deed or deed of trust, pledge, hypothecation,
assignment, deposit arrangement, lien, charge, claim, security interest, security title, easement
or encumbrance, or preference, priority or other security agreement or preferential arrangement of
any kind or nature whatsoever (including any lease or title retention agreement, any financing
lease having substantially the same economic effect as any of the foregoing, and the filing of, or
agreement to give, any financing statement perfecting a security interest under the UCC or
comparable law of any jurisdiction) by which property is encumbered or otherwise charged.



“Loan Agreement” shall mean a valid and enforceable agreement between Lender and a Borrower
setting forth, with respect to each Loan Facility, the terms and conditions of such Loan Facility.



“Loan Authorization Agreement” shall mean, as applicable, the duly executed Loan Authorization
Agreement, Fast Track Loan Authorization Agreement, or the Loan Authorization Notice, setting forth
certain terms and conditions of each Loan Facility, a copy of which is attached hereto as Annex A.



“Loan Authorization Notice” shall mean the Loan Authorization Notice executed by Lender and
delivered to Ex-Im Bank in accordance with the Delegated Authority Letter Agreement setting forth
the terms and conditions of each Loan Facility.



“Loan Documents” shall mean the Loan Authorization Agreement, the Loan Agreement, this
Agreement, each promissory note (if applicable), each Guarantee Agreement, and all other
instruments, agreements and documents now or hereafter executed by the applicable Borrower, any
Guarantor, Lender or Ex-Im Bank evidencing, securing, guaranteeing or otherwise relating to the
Loan Facility or any Credit Accommodations made thereunder.



“Loan Facility” shall mean the Revolving Loan Facility, the Transaction Specific Loan Facility
or the Transaction Specific Revolving Loan Facility established by Lender in favor of Borrower
under the Loan Documents.



“Loan Facility Obligations” shall mean all loans, advances, debts, expenses, fees,
liabilities, and obligations, including any accrued interest thereon, for the performance of
covenants, tasks or duties or for payment of monetary amounts (whether or not such performance is
then required or contingent, or amounts are liquidated or determinable) owing by Borrower to
Lender, of any kind or nature, present or future, arising in connection with the Loan Facility.


 


11









 





“Loan Facility Term” shall mean, with respect to a Loan Facility, the number of months or
portion thereof from the Effective Date to the Final Disbursement Date as set forth in the Loan
Authorization Agreement as amended.



“Master Guarantee Agreement” shall mean the Master Guarantee Agreement between Ex-Im Bank and
Lender, as amended, modified, supplemented and restated from time to time.



“Material Adverse Effect” shall mean a material adverse effect on (a) the business, assets,
operations, prospects or financial or other condition of Borrower or any Guarantor, (b) any
Borrower’s ability to pay or perform the Loan Facility Obligations in accordance with the terms
thereof, (c) the Collateral or Lender’s Liens on the Collateral or the priority of such Lien, or
(d) Lender’s rights and remedies under the Loan Documents.



“Maximum Amount” shall mean the maximum Credit Accommodation Amount that may be outstanding at
any time under each Loan Facility, as specified in Section 5.A. of the Loan Authorization
Agreement.



“Other Assets” shall mean, with respect to a Loan Facility, such other assets of a Borrower to
be included in Primary Collateral, which may include cash and marketable securities, or such other
assets as Ex-Im Bank agrees to in writing, and disclosed as Primary Collateral in Section 6.A. of
the Loan Authorization Agreement. The applicable Advance Rate (to be multiplied by the Other Asset
Value) shall be as agreed to by Ex-Im Bank in writing case by case by case and set forth in Section
5.B.(4) of the Loan Authorization Agreement.



“Other Asset Value” shall mean, with respect to a Loan Facility, at the date of determination
thereof, the value of the Other Assets as determined in accordance with GAAP.



“Other Collateral” shall mean any additional collateral that Lender customarily would require
as security for loan facilities on its own account and risk where the permitted borrowing level is
based principally on a borrowing base derived from a borrower’s inventory and accounts receivable,
but where such additional collateral does not enter into the borrowing base calculation.



“Permitted Liens” shall mean (a) Liens for taxes, assessments or other governmental charges or
levies not delinquent, or, being contested in good faith and by appropriate proceedings and with
respect to which proper reserves have been taken by Borrower; provided, that, the
Lien shall have no effect on the priority of the Liens in favor of Lender or the value of the
assets in which Lender has such a Lien and a stay of enforcement of any such Lien shall be in
effect; (b) deposits or pledges securing obligations under worker’s compensation, unemployment
insurance, social security or public liability laws or similar legislation; (c) deposits or pledges
securing bids, tenders, contracts (other than contracts for the payment of money), leases,
statutory obligations, surety and appeal bonds and other obligations of like nature arising in the
ordinary course of Borrower’s business; (d) judgment Liens that have been stayed or bonded; (e)
mechanics’, workers’, materialmen’s or other like Liens arising in the ordinary course of
Borrower’s business with respect to obligations which are not due; (f) Liens placed upon fixed
assets hereafter acquired to secure a portion of the purchase price thereof, provided, that, any
such Lien shall not encumber any other property of Borrower; (g) security interests being
terminated concurrently with the execution of the Loan Documents; and (h) Liens disclosed in
Section 6.D. of the Loan
Authorization Agreement, provided that, except as otherwise permitted by Ex-Im Bank in
writing, such Liens in Section 6.D. shall be subordinate to the Liens in favor of Lender on Primary
Collateral.


 


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“Person” shall mean any individual, sole proprietorship, partnership, limited liability
partnership, joint venture, trust, unincorporated organization, association, corporation, limited
liability company, institution, public benefit corporation, entity or government (whether national,
federal, provincial, state, county, city, municipal or otherwise, including any instrumentality,
division, agency, body or department thereof), and shall include such Person’s successors and
assigns.



“Pro Rata Percentage” shall mean, with respect to a Loan Facility, as of the date of
determination thereof, the principal balance of the Credit Accommodations outstanding as a
percentage of the combined principal balance of all loans from Lender to such Borrower including
the then outstanding principal balance of the Credit Accommodations plus unfunded amounts under
outstanding Letters of Credit.



“Principals” shall mean any officer, director, owner, partner, key employee, or other Person
with primary management or supervisory responsibilities with respect to Borrower or any other
Person (whether or not an employee) who has critical influence on or substantive control over the
transactions covered by this Agreement.



“Retainage” shall mean that portion of the purchase price of an Export Order that a Buyer is
not obligated to pay until the end of a specified period of time following the satisfactory
performance under such Export Order.



“Retainage Accounts Receivable” shall mean those portions of Eligible Export-Related Accounts
Receivable or Eligible Export-Related Overseas Accounts Receivable arising out of a Retainage.



“Retainage Value” shall mean, at the date of determination thereof, the aggregate face amount
of Retainage Accounts Receivable as permitted by Ex-Im Bank in writing, less taxes, discounts,
credits and allowances, except to the extent otherwise permitted by Ex-Im Bank in writing.



“Revolving Loan Facility” shall mean the credit facility or portion thereof established by
Lender in favor of Borrower for the purpose of providing working capital in the form of loans
and/or Letters of Credit to finance the manufacture, production or purchase and subsequent export
sale of Items pursuant to Loan Documents under which Credit Accommodations may be made and repaid
on a continuous basis based solely on credit availability on the Export-Related Borrowing Base
during the term of such credit facility



“Special Conditions” shall mean those conditions, if any, set forth in Section 13 of the Loan
Authorization Agreement.



“Specific Export Orders” shall mean those Export Orders specified in Section 5.D. of the Loan
Authorization Agreement as applicable for a Transaction Specific Revolving Loan Facility or a
Transaction Specific Loan Facility.


 


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“Standby Letters of Credit” shall mean those letters of credit subject to the ISP or UCP
issued or caused to be issued by Lender for Borrower’s account that can be drawn upon by a Buyer
only if Borrower fails to perform all of its obligations with respect to an Export Order.



“Transaction Specific Loan Facility” shall mean a credit facility or a portion thereof
established by Lender in favor of Borrower for the purpose of providing working capital in the form
of loans and/or Letters of Credit to finance the manufacture, production or purchase and subsequent
export sale of Items pursuant to Loan Documents under which Credit Accommodations are made based
solely on credit availability on the Export-Related Borrowing Base relating to Specific Export
Orders and once such Credit Accommodations are repaid they may not be reborrowed.



“Transaction Specific Revolving Loan Facility” shall mean a Revolving Credit Facility
established to provide financing of Specific Export Orders.



“UCC” shall mean the Uniform Commercial Code, as the same may be in effect from time to time
in the relevant United States jurisdiction.



“UCP” shall mean the Uniform Customs and Practice for Documentary Credits (1993 Revision),
International Chamber of Commerce Publication No. 500 and any amendments and revisions thereof.



“U.S.” or “United States” shall mean the United States of America including any division or
agency thereof (including United States embassies or United States military bases located
overseas), and any United States Territory (including without limitation, Puerto Rico, Guam or the
United States Virgin Islands).



“U.S. Content” shall mean, with respect to any Item, all the costs, including labor,
materials, services and overhead, but not markup or profit margin, which are of U.S. origin or
manufacture, and which are incorporated into an Item in the United States.



“Warranty” shall mean Borrower’s guarantee to Buyer that the Items will function as intended
during the warranty period set forth in the applicable Export Order.



“Warranty Letter of Credit” shall mean a Standby Letter of Credit which is issued or caused to
be issued by Lender to support the obligations of Borrower with respect to a Warranty or a Standby
Letter of Credit which by its terms becomes a Warranty Letter of Credit.



1.02 Rules of Construction. For purposes of this Agreement, the following additional
rules of construction shall apply, unless specifically indicated to the contrary: (a) wherever from
the context it appears appropriate, each term stated in either the singular or plural shall include
the singular and the plural, and pronouns stated in the masculine, feminine or neuter gender shall
include the masculine, the feminine and the neuter; (b) the term “or” is not exclusive; (c) the
term “including” (or any form thereof) shall not be limiting or exclusive; (d) all references to
statutes and related regulations shall include any amendments of same and any successor statutes
and regulations; (e) the words “this Agreement”, “herein”, “hereof”, “hereunder” or other words of
similar import refer to this Agreement as a whole including the schedules, exhibits, and annexes hereto as the same may be amended, modified or supplemented; (f) all references in this
Agreement to sections, schedules, exhibits, and annexes shall refer to the corresponding sections,
schedules, exhibits, and annexes of or to this Agreement; and (g) all references to any instruments
or agreements, including references to any of the Loan Documents, the Delegated Authority Letter
Agreement, or the Fast Track Lender Agreement shall include any and all modifications, amendments
and supplements thereto and any and all extensions or renewals thereof to the extent permitted
under this Agreement.


 


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1.03 Incorporation of Recitals. The Recitals to this Agreement are incorporated into
and shall constitute a part of this Agreement.



ARTICLE II

OBLIGATIONS OF BORROWER




Until payment in full of all Loan Facility Obligations and termination of the Loan Documents,
Borrower agrees as follows:



2.01 Use of Credit Accommodations. (a) Borrower shall use Credit Accommodations only
for the purpose of enabling Borrower to finance the cost of manufacturing, producing, purchasing or
selling the Items. Borrower may not use any of the Credit Accommodations for the purpose of: (i)
servicing or repaying any of Borrower’s pre-existing or future indebtedness unrelated to the Loan
Facility unless approved by Ex-Im Bank in writing; (ii) acquiring fixed assets or capital assets
for use in Borrower’s business; (iii) acquiring, equipping or renting commercial space outside of
the United States; (iv) paying the salaries of non U.S. citizens or non-U.S. permanent residents
who are located in offices outside of the United States; or (v) in connection with a Retainage or
Warranty unless approved by Ex-Im Bank in writing.



(b) In addition, no Credit Accommodation may be used to finance the manufacture, purchase or
sale of any of the following:



(i) Items to be sold to a Buyer located in a country as to which Ex-Im Bank is prohibited from
doing business as designated in the Country Limitation Schedule;



(ii) that part of the cost of the Items which is not U.S. Content unless such part is not
greater than fifty percent (50%) of the cost of the Items and is incorporated into the Items in the
United States;




(iii) defense articles or defense services;




(iv) Capital Goods unless in accordance with Section 2.14 of this Agreement; or



(v) without Ex-Im Bank’s prior written consent, any Items to be used in the construction,
alteration, operation or maintenance of nuclear power, enrichment, reprocessing, research or heavy
water production facilities.



2.02 Security Interests. Borrower agrees to cooperate with Lender in any steps Lender
shall take to file and maintain valid, enforceable and perfected security interests in the
Collateral.


 


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2.03 Loan Documents and Loan Authorization Agreement. (a) This Agreement and each of
the other Loan Documents applicable to Borrower have been duly executed and delivered on behalf of
Borrower, and are and will continue to be legal and valid obligations of Borrower, enforceable
against it in accordance with its terms.



(b) Borrower shall comply with all of the terms and conditions of this Agreement, the Loan
Authorization Agreement and each of the other Loan Documents to which it is a party.




(c) Borrower hereby represents and warrants to Lender that Borrower is an Eligible Person.



2.04 Export-Related Borrowing Base Certificates and Export Orders. (a) In order to
receive Credit Accommodations under the Loan Facility, Borrower shall have delivered to Lender an
Export-Related Borrowing Base Certificate as frequently as required by Lender but at least within
the past month, together with a copy of the Export Order(s) or, for Revolving Loan Facilities, if
permitted by Lender, a written summary of the Export Orders (when Eligible Export-Related Inventory
and Eligible Overseas Export-Related Inventory are entering the Export-Related Borrowing Base)
against which Borrower is requesting Credit Accommodations. In addition, so long as there are any
Credit Accommodations outstanding under the Loan Facility, Borrower shall deliver to Lender an
Export-Related Borrowing Base Certificate at least once each month. Lender shall determine if
daily electronic reporting reconciled monthly may substitute for monthly Export-Related Borrowing
Base Certificates. If the Lender requires an Export-Related Borrowing Base Certificate more
frequently, Borrower shall deliver such Export-Related Borrowing Base Certificate as required by
Lender.



(b) If Lender permits summaries of Export Orders, Borrower shall also deliver promptly to
Lender copies of any Export Orders requested by Lender.



2.05 Schedules, Reports and Other Statements. With the delivery of each
Export-Related Borrowing Base Certificate required in Section 2.04 above, Borrower shall submit to
Lender in writing (a) an Inventory schedule for the preceding month, as applicable, and (b) an
Accounts Receivable Aging Report for the preceding month. Borrower shall also furnish to Lender
promptly upon request such information, reports, contracts, invoices and other data concerning the
Collateral as Lender may from time to time specify.



2.06 Exclusions from the Export-Related Borrowing Base. In determining the
Export-Related Borrowing Base, Borrower shall exclude therefrom Inventory which are not Eligible
Export-Related Inventory or Eligible Export-Related Overseas Inventory and Accounts Receivable
which are not Eligible Export-Related Accounts Receivable or Eligible Export-Related Overseas
Accounts Receivable. Borrower shall promptly, but in any event within five (5) Business Days,
notify Lender (a) if any then existing Export-Related Inventory or Export-Related Overseas
Inventory no longer constitutes Eligible Export-Related Inventory or Eligible Export-Related
Overseas Inventory, as applicable or (b) of any event or circumstance which to Borrower’s knowledge
would cause Lender to consider any then existing Export-Related Accounts Receivable or
Export-Related Overseas Accounts Receivable as no longer constituting an Eligible Export-Related
Accounts Receivable or Eligible Export-Related Overseas Accounts Receivable, as applicable.


 


16









 





2.07 Borrowings and Reborrowings. (a) If the Loan Facility is a Revolving Loan
Facility or Transaction Specific Revolving Loan Facility, provided that Borrower is not in
default under any of the Loan Documents, Borrower may borrow, repay and reborrow amounts under such
Loan Facility up to the credit available on the current Export-Related Borrowing Base Certificate
subject to the terms of this Agreement and each of the other Loan Documents until the close of
business on the Final Disbursement Date.



(b) If the Loan Facility is a Transaction Specific Loan Facility, provided that
Borrower is not in default under any of the Loan Documents, Borrower may borrow (but not reborrow)
amounts under the Loan Facility up to the credit available on the current Export-Related Borrowing
Base Certificate subject to the terms of this Agreement and each of the other Loan Documents until
the close of business on the Final Disbursement Date.



2.08 Repayment Terms. (a) The Borrower on a Revolving Loan Facility shall pay in
full the outstanding Loan Facility Obligations no later than the first Business Day after the Final
Disbursement Date unless such Loan Facility is renewed or extended by Lender consistent with
procedures required by Ex-Im Bank.



(b) The Borrower on a Transaction Specific Loan Facility and a Transaction Specific Revolving
Loan Facility shall, within two (2) Business Days of the receipt thereof, pay to Lender (for
application against the outstanding Loan Facility Obligations) all checks, drafts, cash and other
remittances it may receive in payment or on account of the Export-Related Accounts Receivable,
Export-Related Overseas Accounts Receivable or any other Collateral, in precisely the form received
(except for the endorsement of Borrower where necessary). Pending such deposit, Borrower shall
hold such amounts in trust for Lender separate and apart and shall not commingle any such items of
payment with any of its other funds or property. Unless a Transaction Specific Loan Facility or
Transaction Specific Revolving Loan Facility is renewed or extended by Lender consistent with
procedures required by Ex-Im Bank, Borrower shall pay in full all outstanding Loan Facility
Obligations no later than the first Business Day after the Final Disbursement Date, except for
Eligible Export-Related Accounts Receivables and Eligible Export-Related Overseas Accounts
Receivable outstanding as of the Final Disbursement Date and due and payable after such date, for
which the principal and accrued and unpaid interest thereon shall be due and payable no later than
the first Business Day after the date such Accounts Receivable are due and payable.



2.09 Financial Statements. Borrower shall deliver to Lender the financial statements
required to be delivered by Borrower in accordance with Section 11 of the Loan Authorization
Agreement.



2.10 Additional Security or Payment. (a) Borrower shall at all times ensure that the
Export-Related Borrowing Base equals or exceeds the aggregate outstanding amount of Disbursements.
If informed by Lender or if Borrower otherwise has actual knowledge that the Export-Related
Borrowing Base is at any time less than the aggregate outstanding amount of Disbursements, Borrower
shall, within five (5) Business Days, either (i) furnish additional Collateral to Lender, in form
and amount satisfactory to Lender and Ex-Im Bank or (ii) pay to Lender an amount equal to the
difference between the aggregate outstanding amount of Disbursements and the Export-Related
Borrowing Base.


 


17









 





(b) For purposes of this Agreement, in determining the Export-Related Borrowing Base there
shall be deducted from the Export-Related Borrowing Base an amount equal to (i) twenty-five percent
(25%) of the undrawn amount of outstanding Commercial Letters of Credit and Standby Letters of
Credit and (ii) one hundred percent (100%) of the undrawn amount of outstanding Warranty Letters of
Credit less the amount of cash collateral held by Lender to secure Warranty Letters of
Credit.



(c) Unless otherwise approved in writing by Ex-Im Bank, for Revolving Loan Facilities (other
than Transaction Specific Revolving Loan Facilities), Borrower shall at all times ensure that the
sum of the outstanding amount of Disbursements and the undrawn amount of outstanding Commercial
Letters of Credit that is supported by Eligible Export-Related Inventory or Eligible Export-Related
Overseas Inventory (discounted by the relevant Advance Rate percentages) in the Export-Related
Borrowing Base does not exceed sixty percent (60%) of the sum of the total outstanding amount of
Disbursements and the undrawn amount of all outstanding Commercial Letters of Credit. If informed
by Lender or if Borrower otherwise has actual knowledge that the sum of the outstanding amount of
Disbursements and the undrawn amount of outstanding Commercial Letters of Credit that is supported
by such Inventory exceeds sixty percent (60%) of the sum of the total outstanding Disbursements and
the undrawn amount of all outstanding Commercial Letters of Credit, Borrower shall, within five (5)
Business Days, either (i) furnish additional non-Inventory Collateral to Lender, in form and amount
satisfactory to Lender and Ex-Im Bank, or (ii) pay down the applicable portion of the outstanding
Disbursements or (iii) reduce the undrawn amount of outstanding Commercial Letters of Credit such
that the above described ratio is not exceeded.



(d) If informed by Lender or if Borrower otherwise has actual knowledge that the conditions of
Section 2.16(g) are at any time not being met, Borrower shall, within five (5) Business Days,
either (i) furnish additional Collateral to Lender that is not Eligible Export-Related Overseas
Accounts Receivable or Eligible Export-Related Overseas Inventory, in form and amount satisfactory
to Lender and Ex-Im Bank, or (ii) remove from the Export-Related Borrowing Base the portion of
Eligible Export-Related Overseas Accounts Receivable or Eligible Export-Related Overseas Inventory
that supports greater than fifty percent (50%) of the Export-Related Borrowing Base.



2.11 Continued Security Interest. Borrower shall not change (a) its name or identity
in any manner, (b) the location of its principal place of business or its jurisdiction of
organization or formation, (c) the location of any of the Collateral or (d) the location of any of
the books or records related to the Collateral, in each instance without giving thirty (30) days
prior written notice thereof to Lender and taking all actions deemed necessary or appropriate by
Lender to continuously protect and perfect Lender’s Liens upon the Collateral.



2.12 Inspection of Collateral and Facilities. (a) Borrower shall permit the
representatives of Lender and Ex-Im Bank to make at any time during normal business hours
inspections of the Collateral and of Borrower’s facilities, activities, and books and records, and
shall cause its officers and employees to give full cooperation and assistance in connection
therewith.


 


18









 





(b) Borrower agrees to facilitate Lender’s conduct of field examinations at Borrower’s
facilities in accordance with the time schedule and content for such examinations that Lender
requests. Such field examinations shall address at a minimum: (x) the value of the Collateral
against which Credit Accommodations may be provided, (y) the amount, if any, that the aggregate
outstanding amount of Disbursements exceeds the Export-Related Borrowing Base and (z) whether such
Borrower is in material compliance with the terms of each of the Loan Documents. Such field
examinations shall include an inspection and evaluation of the Export-Related Inventory and
Export-Related Overseas Inventory, a book audit of Export-Related Accounts Receivable and
Export-Related Overseas Accounts Receivable, a review of the Accounts Receivable Aging Reports and
a review of Borrower’s compliance with any Special Conditions. Lenders who opt to use the
Export-Related Historical Inventory Value in the Export-Related Borrowing Base calculation shall
reconcile those numbers against the calculation for the relevant time periods using the
Export-Related Inventory Value. Whenever Export-Related Accounts Receivable or Export-Related
Inventory derived from Indirect Exports are in the Export-Related Borrowing Base, Lender shall
verify compliance with Section 2.15 herein, including taking a random sampling of ultimate foreign
purchasers.



2.13 General Intangibles. Borrower represents and warrants that it owns, or is
licensed to use, all General Intangibles necessary to conduct its business as currently conducted
except where the failure of Borrower to own or license such General Intangibles could not
reasonably be expected to have a Material Adverse Effect.



2.14 Economic Impact Approval. (a) For Loan Facilities up to and including $10
million, Borrower acknowledges that Capital Goods may not be included as Items, and Export-Related
Inventory, Export-Related Overseas Inventory, Export-Related Accounts Receivable and Export-Related
Overseas Accounts Receivable in connection with the sale of such Capital Goods may not be included
in the Export-Related Borrowing Base, if such Capital Goods would enable a foreign buyer to
establish or expand production of a product where, as of the date of the Economic Impact
Certification covering such Item: (i) the Buyer is subject to a Final Anti-Dumping (AD) or
Countervailing Duty (CVD) order, or a Suspension Agreement arising from a AD or CVD investigation,
and such product is substantially the same as the product that is the subject of the AD/CVD order
or suspension agreement; or (ii) the Buyer is the subject of a Section 201 injury determination by
the International Trade Commission (“ITC”) and such product is substantially the same as a product
that is the subject of the ITC injury determination. Borrower may consult with Ex-Im Bank
regarding the appropriate application of this Section 2.14(a) and may, at its option, request that
Ex-Im Bank issue an Economic Impact Approval covering any Items listed in Section 4.A. of the Loan
Authorization Agreement. For Loan Facilities over $10 million involving Items that are Capital
Goods, Borrower shall obtain from Ex-Im Bank, and abide by, an Economic Impact Approval covering
all Items listed in Section 4(A) of the Loan Authorization Agreement.



(b) Borrower shall provide Lender with a certification in the form of Annex B (an “Economic
Impact Certification”) covering the Items stated in Section 4(A) of the Loan Authorization
Agreement prior to Lender including such Items in the Loan Authorization Agreement. Prior to
Lender amending the Loan Authorization Agreement to include additional Items, Borrower shall
provide Lender with an additional Economic Impact Certification covering such additional Items.


 


19









 





2.15 Indirect Exports. Indirect Exports may be included as Items in a Loan Facility
provided that funds available under such Loan Facility’s Export-Related Borrowing Base
supported by Accounts Receivable and Inventory derived from Indirect Exports at no time exceed
ten percent (10%) of the Maximum Amount of such Loan Facility, and provided, further
that (a) the ultimate foreign buyer for the Items must be located in a country in which Ex-Im
Bank is not legally prohibited from doing business in accordance with the Country
Limitation Schedule, and (b) the Borrower must make available to Lender verifiable evidence of
intent to export the Indirect Exports from the United States, which evidence may be contained in
the Export Orders and Accounts Receivable Aging Reports and supporting documents. Lender must
obtain written consent from Ex-Im Bank prior to including funds derived from Indirect Exports in an
Export-Related Borrowing Base above the ten percent (10%) threshold.



2.16 Overseas Inventory and Accounts Receivable. Upon the prior written consent of
Ex-Im Bank, Export-Related Overseas Accounts Receivable and Export-Related Overseas Inventory of a
Borrower or of an Affiliated Foreign Person (as defined below) may be included in the
Export-Related Borrowing Base provided that conditions required by Ex-Im Bank, including the
following, are met:




(a) the Affiliated Foreign Person, if any, has been approved by Ex-Im Bank;




(b) the Affiliated Foreign Person, if any, is a Borrower under the relevant Loan Facility;



(c) notwithstanding the Maximum Amount of the Loan Facility, all payments due and payable on
such Export-Related Overseas Accounts Receivable are collected through a cash collateral account
under Lender’s control;



(d) as of the Effective Date, or such later date when the Export-Related Overseas Accounts
Receivable and/or Export-Related Overseas Inventory are added to the Loan Facility, Lender has
obtained a valid and enforceable first priority Lien in the Export-Related Overseas Accounts
Receivable and Export-Related Overseas Inventory, as applicable;



(e) as of the Effective Date, or such later date when the Export-Related Overseas Accounts
Receivable and/or Export-Related Overseas Inventory are added to the Loan Facility, Lender has
obtained a legal opinion confirming the security interest in the Export-Related Overseas Accounts
Receivable and Export-Related Overseas Inventory;



(f) the Export-Related Overseas Accounts Receivable are due and payable in United States
Dollars or other currency acceptable to Ex-Im Bank; and



(g) at no time may the portion of the Export-Related Borrowing Base derived from Eligible
Export-Related Overseas Accounts Receivable and Eligible Export-Related Overseas Inventory exceed
fifty percent (50%) of the Export-Related Borrowing Base.



For purposes hereof, an “Affiliated Foreign Person” shall mean a subsidiary or affiliate of a
Borrower on the same Loan Facility, which has duly executed as a Borrower all of the applicable
Loan Documents and any other documents required by Ex-Im Bank, meets all of the requirements of the
definition of Eligible Person other than subclause (a) thereof and is in good standing in the
country of its formation or otherwise authorized to conduct business in such country.


 


20









 





2.17 Country Limitation Schedule. Unless otherwise informed in writing by Lender or
Ex-Im Bank, Borrower shall be entitled to rely on the last copy of the Country Limitation Schedule
distributed from Lender to Borrower.



2.18 Notice of Certain Events. Borrower shall promptly, but in any event within five
(5) Business Days, notify Lender in writing of the occurrence of any of the following:



(a) Borrower or any Guarantor (i) applies for, consents to or suffers the appointment of, or
the taking of possession by, a receiver, custodian, trustee, liquidator or similar fiduciary of
itself or of all or a substantial part of its property or calls a meeting of its creditors, (ii)
admits in writing its inability, or is generally unable, to pay its debts as they become due or
ceases operations of its present business, (iii) makes a general assignment for the benefit of
creditors, (iv) commences a voluntary case under any state or federal bankruptcy laws (as now or
hereafter in effect), (v) is adjudicated as bankrupt or insolvent, (vi) files a petition seeking to
take advantage of any other law providing for the relief of debtors, (vii) acquiesces to, or fails
to have dismissed within thirty (30) days, any petition filed against it in any involuntary case
under such bankruptcy laws, or (vii) takes any action for the purpose of effecting any of the
foregoing;



(b) any Lien in any of the Collateral, granted or intended by the Loan Documents to be granted
to Lender, ceases to be a valid, enforceable, perfected, first priority Lien (or a lesser priority
if expressly permitted pursuant to Section 6 of the Loan Authorization Agreement) subject only to
Permitted Liens;



(c) the issuance of any levy, assessment, attachment, seizure or Lien, other than a Permitted
Lien, against any of the Collateral which is not stayed or lifted within thirty (30) calendar days;



(d) any proceeding is commenced by or against Borrower or any Guarantor for the liquidation of
its assets or dissolution;



(e) any litigation is filed against Borrower or any Guarantor which has had or could
reasonably be expected to have a Material Adverse Effect and such litigation is not withdrawn or
dismissed within thirty (30) calendar days of the filing thereof;




(f) any default or event of default under the Loan Documents;




(g) any failure to comply with any terms of the Loan Authorization Agreement;



(h) any material provision of this Agreement or any other Loan Document for any reason ceases
to be valid, binding and enforceable in accordance with its terms;



(i) any event which has had or could reasonably be expected to have a Material Adverse Effect;
or



(j) the aggregate outstanding amount of Disbursements exceeds the applicable Export-Related
Borrowing Base.


 


21









 





2.19 Insurance. Borrower will at all times carry property, liability and other
insurance, with insurers acceptable to Lender, in such form and amounts, and with such deductibles
and other provisions, as Lender shall require, and Borrower will provide evidence of such insurance
to Lender on the proper Acord Form, so that Lender is satisfied that such insurance is, at all
times, in full force and effect. Each property insurance policy shall name Lender as loss payee or
mortgagee and shall contain a lender’s loss payable endorsement in form acceptable to Lender and
each liability insurance policy shall name Lender as an additional insured. All policies of
insurance shall provide that they may not be cancelled or changed without at least thirty (30)
days’ prior written notice to Lender and shall otherwise be in form and substance satisfactory to
Lender. Borrower will promptly deliver to Lender copies of all reports made to insurance
companies.



2.20 Taxes. Borrower has timely filed all tax returns and reports required by
applicable law, has timely paid all applicable taxes, assessments, deposits and contributions owing
by Borrower and will timely pay all such items in the future as they became due and payable.
Borrower may, however, defer payment of any contested taxes; provided, that Borrower (a) in good
faith contests Borrower’s obligation to pay such taxes by appropriate proceedings promptly and
diligently instituted and conducted; (b) notifies Lender in writing of the commencement of, and any
material development in, the proceedings; (c) posts bonds or takes any other steps required to keep
the contested taxes from becoming a Lien upon any of the Collateral; and (d) maintains adequate
reserves therefore in conformity with GAAP.



2.21 Compliance with Laws. Borrower represents and warrants that it has complied in
all material respects with all provisions of all applicable laws and regulations, including those
relating to Borrower’s ownership of real or personal property, the conduct and licensing of
Borrower’s business, the payment and withholding of taxes, ERISA and other employee matters, safety
and environmental matters.



2.22 Negative Covenants. Without the prior written consent of Ex-Im Bank and Lender,
Borrower shall not: (a) merge, consolidate or otherwise combine with any other Person; (b) acquire
all or substantially all of the assets or capital stock of any other Person; (c) sell, lease,
transfer, convey, assign or otherwise dispose of any of its assets, except for the sale of
Inventory in the ordinary course of business and the disposition of obsolete equipment in the
ordinary course of business; (d) create any Lien on the Collateral except for Permitted Liens; (e)
make any material changes in its organizational structure or identity; or (f) enter into any
agreement to do any of the foregoing.



2.23 Cross Default. Borrower shall be deemed in default under the Loan Facility if
Borrower fails to pay when due any amount payable to Lender under any loan or other credit
accommodations to Borrower whether or not guaranteed by Ex-Im Bank.



2.24 Munitions List. If any of the Items are articles, services, or related technical
data that are listed on the United States Munitions List (part 121 of title 22 of the Code of
Federal Regulations), Borrower shall send a written notice promptly, but in any event within five
(5) Business Days, of Borrower learning thereof to Lender describing the Items(s) and the
corresponding invoice amount.


 


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2.25 Suspension and Debarment, etc. On the date of this Agreement neither Borrower
nor its Principals are (a) debarred, suspended, proposed for debarment with a final determination
still pending, declared ineligible or voluntarily excluded (as such terms are defined under
any of the Debarment Regulations referred to below) from participating in procurement or
nonprocurement transactions with any United States federal government department or agency pursuant
to any of the Debarment Regulations or (b) indicted, convicted or had a civil judgment rendered
against Borrower or any of its Principals for any of the offenses listed in any of the Debarment
Regulations. Unless authorized by Ex-Im Bank, Borrower will not knowingly enter into any
transactions in connection with the Items with any person who is debarred, suspended, declared
ineligible or voluntarily excluded from participation in procurement or nonprocurement transactions
with any United States federal government department or agency pursuant to any of the Debarment
Regulations. Borrower will provide immediate written notice to Lender if at any time it learns
that the certification set forth in this Section 2.24 was erroneous when made or has become
erroneous by reason of changed circumstances.



ARTICLE III

RIGHTS AND REMEDIES




3.01 Indemnification. Upon Ex-Im Bank’s payment of a Claim to Lender in connection
with the Loan Facility pursuant to the Master Guarantee Agreement, Ex-Im Bank may assume all rights
and remedies of Lender under the Loan Documents and may enforce any such rights or remedies against
Borrower, the Collateral and any Guarantors. Borrower shall hold Ex-Im Bank and Lender harmless
from and indemnify them against any and all liabilities, damages, claims, costs and losses incurred
or suffered by either of them resulting from (a) any materially incorrect certification or
statement knowingly made by Borrower or its agent to Ex-Im Bank or Lender in connection with the
Loan Facility, this Agreement, the Loan Authorization Agreement or any other Loan Documents or (b)
any material breach by Borrower of the terms and conditions of this Agreement, the Loan
Authorization Agreement or any of the other Loan Documents. Borrower also acknowledges that any
statement, certification or representation made by Borrower in connection with the Loan Facility is
subject to the penalties provided in Article 18 U.S.C. Section 1001.



3.02 Liens. Borrower agrees that any and all Liens granted by it to Lender are also
hereby granted to Ex-Im Bank to secure Borrower’s obligation, however arising, to reimburse Ex-Im
Bank for any payments made by Ex-Im Bank pursuant to the Master Guarantee Agreement. Lender is
authorized to apply the proceeds of, and recoveries from, any property subject to such Liens to the
satisfaction of Loan Facility Obligations in accordance with the terms of any agreement between
Lender and Ex-Im Bank.


 


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ARTICLE IV

MISCELLANEOUS




4.01 Governing Law. This Agreement and the obligations arising under this Agreement
shall be governed by, and construed in accordance with, the law of the state governing the Loan
Agreement.



4.02 Notification. All notices required by this Agreement shall be given in the
manner and to the parties provided for in the Loan Agreement.



4.03 Partial Invalidity. If at any time any of the provisions of this Agreement
becomes illegal, invalid or unenforceable in any respect under the law of any jurisdiction, neither
the legality, the validity nor the enforceability of the remaining provisions hereof shall in any
way be affected or impaired.



4.04 Waiver of Jury Trial. BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY
WAIVES ANY AND ALL RIGHTS IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY ACTION, SUIT, PROCEEDING
OR OTHER LITIGATION BROUGHT TO RESOLVE ANY DISPUTE ARISING UNDER, ARISING OUT OF OR IN CONNECTION
WITH THIS AGREEMENT, THE LOAN AUTHORIZATION AGREEMENT, ANY LOAN DOCUMENT, OR ANY OTHER AGREEMENT,
DOCUMENT OR INSTRUMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH OR THEREWITH OR ANY COURSE OF
CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR WRITTEN), OR ACTIONS OR OMISSIONS OF
LENDER, EX-IM BANK, OR ANY OTHER PERSON, RELATING TO THIS AGREEMENT, THE LOAN AUTHORIZATION
AGREEMENT OR ANY OTHER LOAN DOCUMENT.



4.05 Consequential Damages. Neither Ex-Im Bank, Lender nor any agent or attorney for
any of them shall be liable to Borrower for consequential damages arising from any breach of
contract, tort or other wrong relating to the establishment, administration or collection of the
Loan Facility Obligations.


 


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IN WITNESS WHEREOF, Borrower has caused this Agreement to be duly executed as of the 4th day
of January, 2011.



	 	 	 	 	 
	FUELCELL ENERGY, INC.	 	 
	     (Name of Borrower)	 	 
	 
	 	 	 	 
	By:

	 	/s/ Joseph G. Mahler	 	 
	 

	 	 

(Signature)
	 	 
	Name:
	 	Joseph G. Mahler	 	 
	 

	 	 

(Print or Type)
	 	 
	Title:
	 	Sr. Vice President & CFO	 	 
	 

	 	 

(Print or Type)
	 	 
	 
	 	 	 	 
	ACKNOWLEDGED:	 	 
	 
	 	 	 	 
	JPMORGAN CHASE BANK, N.A.	 	 
	 
	 	 	 	 
	By:
	 	/s/ James P. Murphy	 	 
	 

	 	 

(Signature)
	 	 
	Name:
	 	James P. Murphy	 	 
	 

	 	 

(Print or Type)
	 	 
	Title:
	 	Authorized Signer	 	 
	 

	 	 

(Print or Type)
	 	 
	 
	 	 	 	 
	JPMORGAN CHASE BANK, N.A.	 	 
	Global Trade Services	 	 
	 
	 	 	 	 
	By:
	 	/s/ Randall Mascorro	 	 
	 

	 	 

(Signature)
	 	 
	Name:

	 	Randall Mascorro	 	 
	Title:

	 	Vice President	 	 





 


25









 





ANNEXES:




	 	 	 
	Annex A

	-	 Loan Authorization Agreement, Fast Track Loan Authorization Agreement or Loan Authorization

Notice, as applicable
	 
	Annex B

	-	 Economic Impact Certification







 


26











 




[Two originals to be provided to Ex-Im Bank]




	 	 	 
	To:

	 	Export-Import Bank of the United States
	 

	 	811 Vermont Avenue, N.W.
	 

	 	Washington, D.C. 20571
	 

	 	Attention: Vice President — United States Division






LOAN AUTHORIZATION NOTICE




We hereby notify the Export-Import Bank of the United States (“Ex-Im Bank”) that, pursuant to
the delegated authority granted by Ex-Im Bank to the undersigned institution (the “Lender”) under
the Delegated Authority Letter Agreement referred to below between Lender and Ex-Im Bank, we have
issued an Ex-Im Bank Guarantee under the Master Guarantee Agreement between Ex-Im Bank and Lender,
of the Loan Facility identified below from Lender to Borrower identified below. The Loan Facility
is subject to the specific terms and conditions set forth below. Unless otherwise defined, the
capitalized terms used herein shall have the meanings set forth in the Master Guarantee Agreement.




	1.	 	Documentation and Location of Loan Documents:

	 
	 	 	Name of Lender: JPMorgan Chase Bank, N.A.

	 
	 	 	Delegated Authority Letter Agreement Number: TX — DA — 05 — 010

	 
	 	 	Master Guarantee Agreement Number: TX — MGA — 05 — 010

	 
	 	 	Borrower Agreement Date: January 4, 2011

	 
	 	 	Effective Date of this Loan Facility: January 4, 2011

	 
	 	 	Location of Loan Documents: 2200 Ross Ave., 6th Floor, Dallas, Texas 75201

	 
	 	 	If Borrower was assisted by a city/state export agency, please provide the name of the
agency, contact person, and telephone number.






	 	 	 
	Name:

	 	 
	 

	 	 
	Address:

	 	 
	 

	 	 
	 

	 	 
	 

	 	 
	 

	 	 
	 

	 	 
	 

	 	 
	Attention:

	 	 
	 

	 	 
	Telephone:

	 	 
	 

	 	 





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	2.	 	A. Borrower’s Name and Address: The full name, address, contact person, telephone and telefax
numbers of Borrower are as follows:






	 	 	 
	Name:

	 	FuelCell Energy, Inc.
	Address:

	 	3 Great Pasture Rd.
	 

	 	Danbury, CT 06813
	Attention:

	 	Michael Bishop, VP and Corporate Controller
	Telephone:

	 	203-825-6000 
	Telecopier:

	 	203-825-6100 







	 	B.	 	Is Borrower a Small Business as stipulated by SBA guidelines?

 þ Yes o No

	 
	 	C.	 	Additionality: Please select appropriate answer(s).







	 	o     (1.)	 	 Borrower meets all small business criteria:







	 	(i)	 	Maximum Amount is $2 million or less;

	 
	 	(ii)	 	Borrower qualifies as Small
Business under SBA Guidelines;

	 
	 	(iii)	 	Borrower employs 100 people or fewer; and

	 
	 	(iv)	 	Borrower’s annual revenues do not exceed $10 million.







	 	þ     (2.)	 	Repayment risk associated with foreign sale.

	 
	 	þ     (3.)	 	Borrower’s creditworthiness requires Guarantee.

	 
	 	o     (4.)	 	Lender’s internal lending limits reached.

	 
	 	o     (5.)	 	Lender’s statutory lending limits reached.

	 
	 	o     (6.)	 	Other (please specify)                                         .

	 
	 	þ     (7.)	 	Lender has adequately addressed each of the requirements of
“Additionality” as set forth in the Working Capital Guaranty Manual in its
internal credit memorandum.







	3.	 	Guarantor’s Name and Address: Are there Guarantors for the Loan Facility?







	 	o	 	Yes

	 
	 	þ	 	No If no, attach waiver letter from Ex-Im Bank and/or ownership breakdown.






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	 	 	The full name, address, telephone and telefax numbers of each Guarantor are as follows:






	 	 	 
	Name:

	 	 
	 

	 	 
	Address:

	 	 
	 

	 	 
	 

	 	 
	 

	 	 
	 

	 	 
	 

	 	 
	Attention:

	 	 
	 

	 	 
	Telephone:

	 	 
	 

	 	 
	Telecopier:

	 	 
	 

	 	 







	4.	 	The Items to be financed:







	 	A.     (1.)	 	The Items: (Complete description of goods and services to be exported,
e.g. machine tools, electronic components, logs, etc.)







	 	SIC Code(s)/NAIC No(s): 335999 	 	 Development and manufacture of high- efficiency
stationary fuel cell power plants







	 	(2.)	 	Will Indirect Exports be included in the Export-Related
Borrowing Base?







	 	þ	 	Yes. If yes, please indicate which Items above will include Indirect Exports
and affirm:







	 	þ	 	Funds available under the Export-Related Borrowing Base derived from
Indirect Exports shall at all times constitute no more than 10% of the
Maximum Amount of this Loan Facility in accordance with the standard stated
in Section 4.15 of the Master Guarantee Agreement; or

	 
	 	o	 	Funds available under the Export-Related Borrowing Base derived from
Indirect Exports might constitute more than 10% of the Maximum Amount of
this Loan Facility. Lender has obtained Ex-Im Bank’s prior written consent
to exceed 10% of the Maximum Amount. Attached is a copy of Ex-Im Bank’s
written consent.







	 	o	 	No.







	 	(3.)	 	Have you obtained an Economic Impact Certification from the Borrower covering
all Items listed in 4.A.(1) in accordance with Section 4.09 of the MGA?







	 	þ	 	Yes

	 
	 	o	 	No





Ex-Im Bank 12/31/05


 


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	 	B.	 	Are Commercial Letters of Credit or Standby Letters of Credit (other than
Warranty Letters of Credit) to be issued under this Loan Facility?







	 	þ	 	Yes If yes, approximately what percentage of the Loan Facility will be
utilized for Commercial Letters of Credit or Standby Letters of Credit? Up
to 50%

	 
	 	o	 	No







	 	C.	 	Are Warranty Letters of Credit expected to be issued under this Loan Facility?







	 	o	 	Yes Lender has obtained Ex-Im Bank’s prior written consent for issuance
of such Warranty Letters of Credit. Attached is a copy of Ex-Im Bank’s
written consent.

	 
	 	þ	 	No







	 	D.	 	Are Retainage Accounts Receivable to be included in the Export-Related
Borrowing Base?







	 	o	 	Yes Lender has obtained Ex-Im Bank’s prior written consent for
inclusion of each such Retainage Accounts Receivable. Attached is a copy of
Ex-Im Bank’s written consent.

	 
	 	þ	 	No







	5.	 	Maximum Amount, Advance Rates, Loan Facility Terms:







	 	A.	 	Maximum Amount: $5,000,000.00

	 
	 	B.	 	Advance Rates by Categories of Primary Collateral:







	 	(1.)	 	Inventory: The Advance Rate (to be multiplied by the
Export-Related Inventory Value or Export-Related Historical Inventory Value)
for Collateral categorized as Eligible Export-Related Inventory shall be:






Seventy-five percent ( 75% )





	 	(2.)	 	Accounts Receivable: The Advance Rate (to be multiplied by the
Export-Related Accounts Receivable Value) for Collateral categorized as
Eligible Export-Related Accounts Receivable shall be:






Ninety percent ( 90% )



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	 	(3.)	 	Retainage Accounts Receivable: The Advance Rate (to be
multiplied by the Retainage Value) for Collateral categorized as Retainage
Accounts Receivable shall be:






Zero percent ( 0% )





	 	(4.)	 	Other Assets (as described in Section 6.A. below): The Advance
Rate (to be multiplied by the Other Assets Value) for Collateral categorized as
Other Assets shall be:






Zero percent ( 0% )





	 	(5.)	 	Overseas Accounts Receivable: The Advance Rate (to be
multiplied by the Export-Related Overseas Accounts Receivable Value) for
Collateral categorized as Eligible Export-Related Overseas Accounts Receivable
shall be:






Zero percent ( 0% )





	 	(6.)	 	Overseas Inventory: The Advance Rate (multiplied by the
Export-Related Overseas Inventory Value) for Collateral categorized as Eligible
Export-Related Overseas Inventory shall be:






Zero percent ( 0% )





	 	C.	 	Type of Loan Facility and Exports supported:







	 	(1.)	 	Type of Loan Facility:

	 
	 	þ	 	The Loan Facility is a Revolving Loan Facility (other than a Transaction
Specific Revolving Loan Facility). (Complete subsections (2.), (3.) and
(5.), and, if applicable, (6.) below.)

	 
	 	o	 	The Loan Facility is a Transaction Specific Revolving Loan Facility.
(Complete subsections (3.), (4.), and (5.), and, if applicable, (6.) below.)

	 
	 	o	 	The Loan Facility is a Transaction Specific Loan Facility. (Complete
subsections (3.), (4.), and (5.), and, if applicable, (6.) below.)

	 
	 	(2.)	 	For a Revolving Loan Facility, identify the top three countries
to which the Items will be exported:

Country of Export: South Korea

Country of Export: Canada

Country of Export: Germany







	 	(3.)	 	Estimated Total Export Sales each year to be supported by this
Loan Facility: $ 38,800,000.00





Ex-Im Bank 12/31/05


 


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	 	(4.)	 	For a Transaction Specific Revolving Loan Facility or a
Transaction Specific Loan Facility, identify the Specific Export Order(s):






	 	 	 	 	 	 	 
	Country of Export:

	 	 	 	 	 	 
	 	 	 	 	 
	Contract Price:

	 	$ 
	 	 	 	 
	 

	 	 	 	 	 	 
	Contract Number:

	 	 	 	 	 	 
	 	 	 	 	 
	Contract Date:

	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	 	 	 	 	 
	 	 	 	 	 
	Parties:

	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	 	 	 	 	 
	 	 	 	 	 
	 

	 	 	 	 	 	 
	 	 	 	 	 







	 	(5.)	 	Lender shall conduct field examinations:







	 	o	 	At least every six (6) months starting on the date six (6) months following
the Effective Date of the Loan Facility.







	 	þ	 	At least every six (6) months starting 4/30/11 (specify date no later than
six (6) months following the Effective Date of the Loan Facility;
semi-annual field examination schedule must include Borrower’s fiscal year
end date if audited financial statements will substitute for one field
examination annually).







	 	(6.)	 	For Loan Facilities with a Loan Facility Term greater than one
(1) year, Lender shall provide Ex-Im Bank an annual review:







	 	o	 	On each Loan Facility Anniversary Date or

	 
	 	o	 	Annually starting                      (specify date no later than the first
anticipated Loan Facility Anniversary Date).







	6.	 	Security Interests:

	 
	 	 	Subject to the provisions of subsections D, E and F below in this Section 6, Lender agrees
to obtain and maintain the following valid, enforceable and perfected security interests in
the following Collateral, and the proceeds thereof:







	 	A.	 	First priority in the following (check all that apply):







	 	þ	 	All Inventory.

	 
	 	o	 	All Export-Related Inventory.

	 
	 	o	 	All Export-Related Overseas Inventory.





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	 	o	 	All Export-Related Inventory relating to Specific Export Order(s).

	 
	 	o	 	All Export-Related Overseas Inventory relating to Specific Export Order(s).

	 
	 	þ	 	All Accounts Receivable.

	 
	 	o	 	All Export-Related Accounts Receivable.

	 
	 	o	 	All Export-Related Overseas Accounts Receivable.

	 
	 	o	 	All Export-Related Accounts Receivable relating to Specific Export Order(s).

	 
	 	o	 	All Export-Related Overseas Accounts Receivable relating to Specific Export
Order(s).

	 
	 	þ	 	All General Intangibles.

	 
	 	o	 	All Export-Related General Intangibles.

	 
	 	o	 	All Other Assets. Please specify:                                                             

	 
	 	o	 	All Other Collateral. Please specify:                                                            







	 	B.	 	Secondary Collateral: Any other assets of Borrower in which Lender is
receiving a Lien to secure any other financial accommodations provided by Lender to
such Borrower.

	 
	 	 	 	Please specify: Cash collateral being held at JPMC securing other facilities

	 
	 	C.	 	Guarantor Collateral: Any assets of a Guarantor or a third party in which
Lender is granted a Lien to secure any financial accommodations provided by Lender to
Borrower.

	 
	 	 	 	Please specify: N/A

	 
	 	D.	 	Permitted Liens:






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	 	 	 	(1) Liens granted to the Connecticut Development Authority pursuant to: (a) the Note
in the amount of $4,000,000, the Loan Agreement, and the Security Agreement all
dated April 29, 2008; and (b) the Loan Agreement with the Connecticut Development
Authority Dated as of June 30, 2000, as amended.

	 
	 	 	 	(2) Liens granted to (i) Relational, LLC, (ii) Relational II, LLC, and(iii) Key
Equipment Finance Inc. for which UCC Financing Statements have been filed prior to
the date hereof, securing equipment leased or purchased by the Borrower;

	 
	 	 	 	(3) Liens granted or to be granted in connection with the financing of power plants
to be sold by the Borrower to entities controlled by the Borrower or the Borrower’s
distribution partners for projects selected by the State of Connecticut Department
of Public Utility Control (“DPUC”) for purposes of providing 43.5 megawatts,
including (but not limited to) projects for generating approximately 27.3 megawatts
of power which may be financed in whole or in part by a United States Department of
Energy Loan Guarantee.

	 
	 	 	 	(4) Liens on raw materials which secure trade debt arising from the purchase of
such raw materials and such trade debt is incurred by borrower in the ordinary
course of business;

	 
	 	 	 	(5) Liens and all associated rights of the Department of Energy and other
governmental agencies arising from so-called “march-in rights” to the technology
subject to a cooperative research and development agreement.

	 
	 	E.	 	The Liens of Lender on the Secondary Collateral shall be a first priority Lien
except for the following Liens: N/A

	 
	 	F.	 	The Liens of Lender on the Guarantor Collateral shall be a first priority Lien
except for the following Liens: N/A

	 
	 	G.	 	Are you separately collateralizing the Unguaranteed Portion10% portion of this
Loan Facility?

	 
	 	 	 	No þ

	 
	 	 	 	Yes  o If yes, please specify separate collateral. _________________________.







	 	 	Note: Lender cannot collateralize its retained 10% risk with cash, cash equivalents or
marketable securities from Borrower, any Guarantor, or any of Borrower’s Affiliates (as
defined in Section 5(b) of the Delegated Authority Letter Agreement) or any third party
guarantors.





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	7.	 	Terms of Sale:

	 
	 	 	The terms of sale for the Items under this Loan Facility shall be typical for the industry
but in no event shall allow for payment more than 180 days following the original invoice
date. The terms may include the following:







	 	þ	 	Confirmed irrevocable letters of credit.

	 
	 	þ	 	Irrevocable letters of credit.

	 
	 	þ	 	Open account insured through Ex-Im Bank export credit insurance for comprehensive
commercial and political risk.

	 
	 	þ	 	Open account insured through non Ex-Im Bank export credit insurance for
comprehensive commercial and political risk.

	 
	 	þ	 	Cash payment received prior to shipment.

	 
	 	þ	 	Open account uninsured.

	 
	 	þ	 	Sight draft documents against payment (also known as “documentary collections”).

	 
	 	o	 	Other terms. [If checked, any such terms of sale must be fully described on an
attached addendum in order for this Notice to be considered complete.]







	8.	 	Interest Rate and Other Fees.







	 	A.	 	Lender’s Interest Rate: JPMC CBFR or LIBOR + 1 1/2%

	 
	 	B.	 	Other Fees: Letter of Credit fees if applicable







	9.	 	Facility Fee: Lender will submit a completed and signed Schedule A together with the
Facility Fee amount determined in accordance with the applicable section of Schedule A:







	 	A.	 	within ten (10) Business Days of the Effective Date;

	 
	 	B.	 	with respect to a Revolving Loan Facility (other than a Transaction Specific
Revolving Loan Facility), within ten (10) Business Days of the first and second
anniversaries of the Effective Date, as applicable; and/or

	 
	 	C.	 	within ten (10) Business Days of the Effective Date of an Extension of the
Final Disbursement Date (such Extensions not to exceed one-hundred-twenty (120) days
in the aggregate), as applicable. Please note that Ex-Im Bank considers a Renewal to
be a new Loan Facility rather than an Extension.






Ex-Im Bank 12/31/05


 


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	10.	 	Final Disbursement Date: January 3, 2012.

	 
	11.	 	Financial Reporting Requirements: Borrower and each Guarantor shall deliver to Lender
the following financial statements:







	 	A.	 	Year End Financial Statements.

	 
	 	 	 	Within one hundred and twenty (120) days of Borrower’s and each Guarantor’s (other
than individual Guarantor) fiscal year end or if such Person is required to submit a
Form 10-K at the time of filing of such Form 10-K, the income statement, balance
sheet and statement of cash flow as of such fiscal year-end including in each case
all footnotes and other disclosures, which financial statements have been (check
one):







	 	þ	 	certified without qualification by an independent accounting firm
acceptable to Lender (the “Accountants”) (For Loan Facilities with a
Maximum Amount of $5,000,000 or more)

	 
	 	o	 	reviewed by the Accountants (For Loan Facilities with a Maximum
Amount of $2,000,000 or more but less than $5,000,000)

	 
	 	o	 	compiled by the Accountants (For Loan Facilities with a Maximum
Amount of $1,000,000 or more but less than $2,000,000)

	 
	 	o	 	internally prepared by management of such Person in accordance with
GAAP, certified as fairly presenting the financial condition of such
Person as of the date thereof by an authorized officer of such Person
(For Loan Facilities with a Maximum Amount of less than $1,000,000)







	 	B.	 	Quarterly Financial Statements.

	 
	 	 	 	Within 45 days of Borrower’s and each Guarantor’s (other than an individual
Guarantor) fiscal quarter end or if such Person is required to submit a Form 10-Q at
the time of filing of such Form 10-Q, the income statement, balance sheet and
statement of cash flow as of the end of such fiscal quarter which have been
internally prepared by management of such Person in accordance with GAAP, and
certified as fairly presenting the financial condition of such Person as of the date
thereof by an authorized officer of such Person.

	 
	 	C.	 	Individual Guarantors Financial Statements: Once each year, a personal
financial statement on a bank form or such other form generally accepted by Lender.







	12.	 	Country Limitation Schedule: (See Country Limitation Schedule dated October 28,
2010, attached hereto, which may be updated from time to time)

	 
	13.	 	See attached waiver letters dated August 2, 2010, November 10, 2010 and December 13, 2010 and
e-mail correspondence dated December 16, 2010 from the Export-Import Bank of the United States
for a listing of the approved waiver items.






Ex-Im Bank 12/31/05


 


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IN WITNESS WHEREOF, Lender has caused this instrument to be executed and delivered as of this
4th day of January, 2011.



	 	 	 	 	 
	Name of Lender:

	 	JPMorgan Chase Bank, N.A.	 	 
	 

	 	 
 

	 	 
	By:

	 	 
 

	 	 
	 

	 	(Signature)	 	 
	Name:

	 	Randall Mascorro	 	 
	Title:

	 	Vice President	 	 






	 	 	 	 	 
	Address:
	 	 	 	 
	 

	 	2200 Ross Ave., 6th Floor
	 	Telephone: 214-965-3632
	 

	 	Dallas, Texas 75201
	 	Telefax:      214-965-3671





Receipt acknowledged by:



Export-Import Bank of the United States




	 	 	 	 	 
	By:

	 	 
 

(Signature)
	 	 
	 
	 	 	 	 
	Name:

	 	 	 	 
	 

	 	 	 	 
	Title:

	 	                    , Business Credit Division	 	 
	Date:

	 	 	 	 
	 

	 	 	 	 





Ex-Im Bank hereby designates the Loan Facility referred to in this Loan Authorization Notice as
Guaranteed Loan Facility No.                                         .



Ex-Im Bank 12/31/05



 


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