NONPAYMENT.
THE FEES
DESCRIBED IN THIS AGREEMENT REPRESENT COMPENSATION FOR SERVICES RENDERED AND TO
BE RENDERED SEPARATE AND APART FROM THE LENDING OF MONEY OR THE PROVISION OF
CREDIT AND DO NOT CONSTITUTE COMPENSATION FOR THE USE, DETENTION OR FORBEARANCE
OF MONEY, AND THE OBLIGATION OF THE BORROWER TO PAY EACH FEE DESCRIBED HEREIN
SHALL BE IN ADDITION TO, AND NOT IN LIEU OF, THE OBLIGATION OF THE BORROWER TO
PAY INTEREST, OTHER FEES DESCRIBED IN THIS AGREEMENT, AND EXPENSES OTHERWISE
DESCRIBED IN THIS AGREEMENT.
FEES SHALL BE PAYABLE WHEN DUE IN DOLLARS AND IN
IMMEDIATELY AVAILABLE FUNDS.
ALL FEES SHALL BE NON-REFUNDABLE, AND SHALL, TO
THE FULLEST EXTENT PERMITTED BY LAW, BEAR INTEREST, IF NOT PAID WITHIN FIVE (5)
BUSINESS DAYS OF WHEN DUE, AT A RATE PER ANNUM EQUAL TO THE DEFAULT RATE.
ARTICLE V.
PERMITTED PURPOSES OF LETTERS OF CREDIT
The Borrower agrees that the Letters of Credit shall be issued solely to support
one or more of the Borrower's, any Guarantor's or any Eligible Joint Venture's
obligations under an Export Order.
No Letter of Credit may be a Warranty Letter
of Credit; provided, however, a performance Letter of Credit that converts to a
Warranty Letter of Credit at the end of the performance period may be issued so
long as the Bank's liability thereunder and therefor is eliminated (in a manner
satisfactory to the Bank in its sole discretion) not later than the date when
the warranty period commences.
ARTICLE VI.
REPRESENTATIONS AND WARRANTIES.
The Borrower and, as applicable, each Guarantor each represents and warrants
that:
6.1
ORGANIZATION AND QUALIFICATION.
IT AND EACH
OF ITS SUBSIDIARIES (A) IS DULY ORGANIZED, VALIDLY EXISTING, AND IN GOOD
STANDING UNDER THE LAWS OF THE JURISDICTION OF ITS ORGANIZATION (EXCEPT TO THE
EXTENT THAT SUCH FAILURE TO BE IN GOOD STANDING UNDER SUCH LAWS COULD NOT
REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT); (B) HAS THE POWER TO
OWN ITS PROPERTIES AND TO CARRY ON ITS BUSINESS AS NOW CONDUCTED; AND (C) IS
DULY QUALIFIED TO DO BUSINESS AND IS IN GOOD STANDING IN ALL JURISDICTIONS IN
WHICH THE FAILURE TO SO QUALIFY OR BE IN GOOD STANDING COULD REASONABLY BE
EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT.
AS OF THE CLOSING DATE, THE
BORROWER HAS NO SUBSIDIARIES OTHER THAN THOSE LISTED ON SCHEDULE 6.1.
6.2
FINANCIAL STATEMENTS; POSITIVE TANGIBLE NET
WORTH.
THE BORROWER HAS FURNISHED THE BANK WITH THE FOLLOWING FINANCIAL
STATEMENTS:
(A) ITS YEAR-END ANNUAL AUDITED FINANCIAL STATEMENTS FOR THE FISCAL
YEAR ENDED DECEMBER 31, 2005; AND (B) ITS UNAUDITED CONSOLIDATED BALANCE SHEET,
STATEMENT OF EARNINGS AND STATEMENT OF CASH FLOW AS AT AND FOR THE THREE MONTH
PERIOD ENDED JUNE 30, 2006.
THESE STATEMENTS HAVE BEEN PREPARED IN CONFORMITY
WITH GAAP, EXCEPT, IN THE CASE OF UNAUDITED FINANCIAL STATEMENTS, FOR THE
ABSENCE OF FOOTNOTE DISCLOSURE AND FOR YEAR-END AUDIT ADJUSTMENTS.
SUCH
STATEMENTS FAIRLY PRESENT, IN ALL MATERIAL RESPECTS, THE
11
CONSOLIDATED FINANCIAL CONDITION OF THE BORROWER AND ITS SUBSIDIARIES AND THE
CONSOLIDATED RESULTS OF