TO AGENT, RELATING TO THE CREATION, VALIDITY,
PERFECTION, MAINTENANCE OR CONTINUATION OF AGENT'S SECURITY INTEREST AND LIEN
UNDER THE UNIFORM COMMERCIAL CODE OR OTHER APPLICABLE LAW.
BY ITS SIGNATURE
HERETO, EACH BORROWER HEREBY AUTHORIZES AGENT TO FILE AGAINST SUCH BORROWER, ONE
OR MORE FINANCING, CONTINUATION OR AMENDMENT STATEMENTS PURSUANT TO THE UNIFORM
COMMERCIAL CODE IN FORM AND SUBSTANCE SATISFACTORY TO AGENT (WHICH STATEMENTS
MAY HAVE A DESCRIPTION OF COLLATERAL WHICH IS BROADER THAN THAT SET FORTH
HEREIN).
ALL CHARGES, EXPENSES AND FEES AGENT MAY INCUR IN DOING ANY OF THE
FOREGOING, AND ANY LOCAL TAXES RELATING THERETO, SHALL BE CHARGED TO BORROWERS'
ACCOUNT AS A REVOLVING ADVANCE OF A DOMESTIC RATE LOAN AND ADDED TO THE
OBLIGATIONS, OR, AT AGENT'S OPTION, SHALL BE PAID TO AGENT FOR ITS BENEFIT AND
FOR THE RATABLE BENEFIT OF LENDERS IMMEDIATELY UPON DEMAND.
4.3.
DISPOSITION OF COLLATERAL.
EACH BORROWER WILL SAFEGUARD AND
PROTECT ALL COLLATERAL FOR AGENT'S GENERAL ACCOUNT AND MAKE NO DISPOSITION
THEREOF WHETHER BY SALE, LEASE OR OTHERWISE EXCEPT: (A) THE SALE OR OTHER
DISPOSITION OF INVENTORY IN THE ORDINARY COURSE OF BUSINESS (INCLUDING THE SALE
OR OTHER DISPOSITION OF SLOW-MOVING, DISCONTINUED AND OBSOLETE INVENTORY); (B)
THE DISPOSITION OR TRANSFER OF OBSOLETE AND WORN-OUT EQUIPMENT IN THE ORDINARY
COURSE OF BUSINESS DURING ANY FISCAL YEAR HAVING AN AGGREGATE FAIR MARKET VALUE
OF NOT MORE THAN $500,000 AND ONLY TO THE EXTENT THAT (I) THE PROCEEDS OF ANY
SUCH DISPOSITION ARE USED TO ACQUIRE REPLACEMENT EQUIPMENT WHICH IS SUBJECT TO
AGENT'S FIRST PRIORITY SECURITY INTEREST OR (II) THE PROCEEDS OF WHICH ARE
REMITTED TO AGENT TO BE APPLIED PURSUANT TO SECTION 2.21; (C) THE DONATION OF
INVENTORY INCLUDED IN THE FORMULA AMOUNT TO CHARITY DURING ANY FISCAL YEAR IN AN
AGGREGATE AMOUNT OF $25,000; AND (D) AS OTHERWISE PERMITTED BY THIS AGREEMENT,
INCLUDING SECTION 7.1.
4.4.
PRESERVATION OF COLLATERAL.
FOLLOWING THE OCCURRENCE OF A DEFAULT
OR EVENT OF DEFAULT IN ADDITION TO THE RIGHTS AND REMEDIES SET FORTH IN SECTION
11.1 HEREOF, AGENT: (A) MAY AT ANY TIME TAKE SUCH STEPS AS AGENT DEEMS NECESSARY
TO PROTECT AGENT'S INTEREST IN AND TO PRESERVE THE COLLATERAL, INCLUDING THE
HIRING OF SUCH SECURITY GUARDS OR THE PLACING OF OTHER SECURITY PROTECTION
MEASURES AS AGENT MAY DEEM APPROPRIATE; (B) MAY EMPLOY AND MAINTAIN AT ANY OF
ANY BORROWER'S PREMISES A CUSTODIAN WHO SHALL HAVE FULL AUTHORITY TO DO ALL ACTS
NECESSARY TO PROTECT AGENT'S INTERESTS IN THE COLLATERAL; (C) MAY LEASE
WAREHOUSE FACILITIES TO WHICH AGENT MAY MOVE
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ALL OR PART OF THE COLLATERAL; (D) MAY USE ANY BORROWER'S OWNED OR LEASED LIFTS,
HOISTS, TRUCKS AND OTHER FACILITIES OR EQUIPMENT FOR HANDLING OR REMOVING THE
COLLATERAL; AND (E) SHALL HAVE, AND IS HEREBY GRANTED, A RIGHT OF INGRESS AND
EGRESS TO THE PLACES WHERE THE COLLATERAL IS LOCATED, AND MAY PROCEED OVER AND
THROUGH ANY OF BORROWERS' OWNED OR LEASED PROPERTY.
EACH BORROWER SHALL
COOPERATE FULLY WITH ALL OF AGENT'S EFFORTS TO PRESERVE THE COLLATERAL AND WILL
TAKE SUCH ACTIONS TO PRESERVE THE COLLATERAL