(XI)
THAT ARISES WITH RESPECT TO GOODS THAT ARE
DELIVERED ON A BILL-AND-HOLD, CASH-ON-DELIVERY BASIS OR PLACED ON CONSIGNMENT,
GUARANTEED SALE OR OTHER TERMS BY REASON OF WHICH THE PAYMENT BY THE ACCOUNT
DEBTOR IS OR MAY BE CONDITIONAL;
(XII)
THAT IS IN DEFAULT; PROVIDED, THAT AN ACCOUNT
SHALL BE DEEMED IN DEFAULT UPON THE OCCURRENCE OF ANY OF THE FOLLOWING:
(A)
THE ACCOUNT IS NOT PAID WITHIN THE EARLIER OF: SIXTY
(60) DAYS FOLLOWING ITS DUE DATE OR 120 DAYS FOLLOWING ITS ORIGINAL INVOICE DATE
UNLESS PAYMENT THEREOF IS SECURED BY A LETTER OF CREDIT SATISFACTORY TO AGENT AS
TO FORM, SUBSTANCE AND ISSUER;
(B)
THE ACCOUNT DEBTOR OBLIGATED UPON SUCH ACCOUNT
SUSPENDS BUSINESS, MAKES A GENERAL ASSIGNMENT FOR THE BENEFIT OF CREDITORS OR
FAILS TO PAY ITS DEBTS GENERALLY AS THEY COME DUE; OR
(C)
A PETITION IS FILED BY OR AGAINST ANY ACCOUNT
DEBTOR OBLIGATED UPON SUCH ACCOUNT UNDER ANY BANKRUPTCY LAW OR ANY OTHER
FEDERAL, STATE OR FOREIGN (INCLUDING ANY PROVINCIAL) RECEIVERSHIP, INSOLVENCY
RELIEF OR OTHER LAW OR LAWS FOR THE RELIEF OF DEBTORS;
15
(XIII)
THAT IS THE OBLIGATION OF AN ACCOUNT DEBTOR IF
50% OR MORE OF THE DOLLAR AMOUNT OF ALL ACCOUNTS OWING BY THAT ACCOUNT DEBTOR
ARE INELIGIBLE UNDER THE CRITERIA SET FORTH IN CLAUSE (XII) ABOVE;
(XIV)
AS TO WHICH AGENT'S LIEN THEREON, ON BEHALF OF
ITSELF AND LENDERS, OR THE LIEN CREATED BY THE FOREIGN COLLATERAL DOCUMENTS IS
NOT A FIRST PRIORITY PERFECTED LIEN;
(XV)
AS TO WHICH ANY OF THE REPRESENTATIONS OR
WARRANTIES IN THE LOAN DOCUMENTS ARE UNTRUE IN ANY MATERIAL RESPECT;
(XVI)
TO THE EXTENT SUCH ACCOUNT IS EVIDENCED BY A
JUDGMENT, INSTRUMENT OR CHATTEL PAPER;
(XVII)
TO THE EXTENT THAT SUCH ACCOUNT, TOGETHER WITH ALL
OTHER ACCOUNTS OWING BY SUCH ACCOUNT DEBTOR AND ITS AFFILIATES AS OF ANY DATE OF
DETERMINATION EXCEED 15% OF ALL ELIGIBLE ACCOUNTS - SCHAUBLIN;
(XVIII)
THAT IS PAYABLE IN ANY CURRENCY OTHER THAN DOLLARS OR
AN ACCEPTABLE FOREIGN CURRENCY; OR
(XIX)
TO THE EXTENT THAT A SUPPLIER OF SCHAUBLIN CAN
ASSERT ANY RIGHT AS TO SUCH ACCOUNT BY REASON OF AN EXTENDED RESERVATION OF
TITLE.
It is understood and agreed that any Account excluded from eligibility under
clause (xii) above shall be excluded in its entirety, meaning that any past due
credits with respect thereto shall also be excluded thereunder.
1.7
ELIGIBLE INVENTORY - U.S.; ELIGIBLE
INVENTORY - SCHAUBLIN.
(A)
ELIGIBLE INVENTORY - U.S.
ALL OF THE
INVENTORY OWNED BY BORROWER OR ANY SECURED GUARANTOR AND REFLECTED IN THE MOST
RECENT U.S. BORROWING BASE CERTIFICATE DELIVERED BY BORROWER TO AGENT SHALL BE
"ELIGIBLE INVENTORY - U.S." FOR PURPOSES OF THIS AGREEMENT, EXCEPT ANY INVENTORY
TO WHICH ANY OF THE EXCLUSIONARY CRITERIA SET FORTH BELOW APPLIES.
AGENT SHALL
HAVE THE RIGHT TO ESTABLISH, MODIFY, OR ELIMINATE RESERVES AGAINST ELIGIBLE
INVENTORY - U.S. FROM TIME TO TIME IN ITS REASONABLE CREDIT JUDGMENT TO REFLECT
ISSUES WITH RESPECT TO THE SALABILITY OF INVENTORY ARISING OR DISCOVERED BY
AGENT AFTER THE CLOSING DATE.
IN