Worth" shall mean, at any time the same is to be determined, the
total shareholders equity (including capital stock, additional paid-in capital
and retained earnings after deducting treasury stock) which would appear on the
balance sheet of the Borrower determined in accordance with generally accepted
accounting principles, less the sum of (a) all notes receivable from officers
and employees of the Borrower, (b) the aggregate book value of all assets which
would be classified as intangible assets under GAAP, including, without
limitation, goodwill, patents, trademarks, trade names, copyrights, franchises
and deferred charges (including, without limitation, unamortized debt discount
and expense, organization costs and deferred research and development expense)
and similar assets, and (c) the write-up of assets above cost.
9
"UCC" shall mean the Uniform Commercial Code in effect in the state of Illinois
from time to time.
"Unmatured Event of Default" shall mean any event which, with the giving of
notice, the passage of time or both, would constitute an Event of Default.
"Voidable Transfer" shall have the meaning set forth in Section 11.18 hereof.
1.2
ACCOUNTING TERMS.
ANY ACCOUNTING TERMS USED IN THIS AGREEMENT
WHICH ARE NOT SPECIFICALLY DEFINED HEREIN SHALL HAVE THE MEANINGS CUSTOMARILY
GIVEN THEM IN ACCORDANCE WITH GAAP.
CALCULATIONS AND DETERMINATIONS OF
FINANCIAL AND ACCOUNTING TERMS USED AND NOT OTHERWISE SPECIFICALLY DEFINED
HEREUNDER AND THE PREPARATION OF FINANCIAL STATEMENTS TO BE FURNISHED TO THE
BANK PURSUANT HERETO SHALL BE MADE AND PREPARED, BOTH AS TO CLASSIFICATION OF
ITEMS AND AS TO AMOUNT, IN ACCORDANCE WITH SOUND ACCOUNTING PRACTICES AND GAAP
AS USED IN THE PREPARATION OF THE FINANCIAL STATEMENTS OF THE BORROWER ON THE
DATE OF THIS AGREEMENT.
IF ANY CHANGES IN ACCOUNTING PRINCIPLES OR PRACTICES
FROM THOSE USED IN THE PREPARATION OF THE FINANCIAL STATEMENTS ARE HEREAFTER
OCCASIONED BY THE PROMULGATION OF RULES, REGULATIONS, PRONOUNCEMENTS AND
OPINIONS BY OR REQUIRED BY THE FINANCIAL ACCOUNTING STANDARDS BOARD OR THE
AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS (OR ANY SUCCESSOR THERETO OR
AGENCIES WITH SIMILAR FUNCTIONS), WHICH RESULTS IN A MATERIAL CHANGE IN THE
METHOD OF ACCOUNTING IN THE FINANCIAL STATEMENTS REQUIRED TO BE FURNISHED TO THE
BANK HEREUNDER OR IN THE CALCULATION OF FINANCIAL COVENANTS, STANDARDS OR TERMS
CONTAINED IN THIS AGREEMENT, THE PARTIES HERETO AGREE TO ENTER INTO GOOD FAITH
NEGOTIATIONS TO AMEND SUCH PROVISIONS SO AS EQUITABLY TO REFLECT SUCH CHANGES TO
THE END THAT THE CRITERIA FOR EVALUATING THE FINANCIAL CONDITION AND PERFORMANCE
OF THE BORROWER WILL BE THE SAME AFTER SUCH CHANGES AS THEY WERE BEFORE SUCH
CHANGES; AND IF THE PARTIES FAIL TO AGREE ON THE AMENDMENT OF SUCH PROVISIONS,
THE BORROWER WILL FURNISH FINANCIAL STATEMENTS IN ACCORDANCE WITH SUCH CHANGES,
BUT SHALL PROVIDE CALCULATIONS, WHICH ARE REVIEWED AND CERTIFIED BY THE
BORROWER'S ACCOUNTANTS, FOR ALL FINANCIAL COVENANTS, SHALL PERFORM ALL FINANCIAL
COVENANTS AND SHALL OTHERWISE OBSERVE ALL FINANCIAL STANDARDS AND TERMS IN
ACCORDANCE WITH APPLICABLE ACCOUNTING PRINCIPLES AND PRACTICES IN EFFECT
IMMEDIATELY PRIOR TO SUCH CHANGES. CALCULATIONS WITH RESPECT TO FINANCIAL
COVENANTS REQUIRED TO BE STATED IN ACCORDANCE WITH