THAN $10,000,000, AGENT SHALL HAVE RECEIVED: (I) THE MOST
RECENT ANNUAL AND INTERIM FINANCIAL STATEMENTS WITH RESPECT TO THE ACQUIRED
BUSINESS AND RELATED STATEMENTS OF INCOME AND CASH FLOWS SHOWING POSITIVE CASH
FLOWS FOR THE IMMEDIATELY PRECEDING FISCAL YEAR OF SUCH ACQUIRED BUSINESS,
(II) DETAILED FORECASTS OF CASH FLOWS FOR THE ACQUIRED BUSINESS FORECASTING
POSITIVE FUTURE CASH FLOWS, (III) DETAILED PROJECTIONS FOR HAYNES PARENT AND ITS
SUBSIDIARIES THROUGH THE MATURITY DATE GIVING PRO FORMA EFFECT TO SUCH
ACQUISITION, BASED ON ASSUMPTIONS REASONABLY SATISFACTORY TO AGENT AND
DEMONSTRATING PRO FORMA COMPLIANCE WITH ALL FINANCIAL COVENANTS SET FORTH IN
THIS AGREEMENT, PREPARED IN GOOD FAITH AND IN A MANNER AND USING SUCH
METHODOLOGY AS IS CONSISTENT WITH THE MOST RECENT FINANCIAL STATEMENTS DELIVERED
TO AGENT PURSUANT TO SECTION 9.6 HEREOF AND IN FORM AND SUBSTANCE REASONABLY
SATISFACTORY TO AGENT AND (IV) CURRENT, UPDATED PROJECTIONS OF THE AMOUNT OF THE
BORROWING BASE AND EXCESS AVAILABILITY FOR THE 12 MONTH PERIOD AFTER THE DATE OF
SUCH ACQUISITION, IN A FORM REASONABLY SATISFACTORY TO AGENT, REPRESENTING
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Borrowers' reasonable best estimate of the future Borrowing Base and Excess
Availability for the period set forth therein as of the date not more than ten
(10) days prior to the date of such acquisition, which projections shall have
been prepared on the basis of the assumptions set forth therein which Borrowers
believe are fair and reasonable as of the date of preparation in light of
current and reasonably foreseeable business conditions and which projections
shall show amounts of Excess Availability satisfactory to Agent,
(E)
IF ADMINISTRATIVE BORROWER REQUESTS THAT ANY ASSETS ACQUIRED PURSUANT
TO SUCH ACQUISITION BE INCLUDED IN THE BORROWING BASE, AGENT SHALL HAVE
COMPLETED A FIELD EXAMINATION WITH RESPECT TO THE BUSINESS AND ASSETS OF THE
ACQUIRED BUSINESS IN ACCORDANCE WITH AGENT'S CUSTOMARY PROCEDURES AND PRACTICES
AND AS OTHERWISE REQUIRED BY THE NATURE AND CIRCUMSTANCES OF THE BUSINESS OF THE
ACQUIRED BUSINESS, THE SCOPE AND RESULTS OF WHICH SHALL BE SATISFACTORY TO AGENT
AND ANY ACCOUNTS AND INVENTORY OF THE ACQUIRED BUSINESS SHALL ONLY BE ELIGIBLE
ACCOUNTS AND ELIGIBLE INVENTORY, RESPECTIVELY, TO THE EXTENT AGENT HAS COMPLETED
SUCH FIELD EXAMINATION WITH RESPECT THERETO AND THE CRITERIA FOR ELIGIBLE
ACCOUNTS AND ELIGIBLE INVENTORY SET FORTH HEREIN ARE SATISFIED WITH RESPECT
THERETO IN ACCORDANCE WITH THIS AGREEMENT (OR SUCH OTHER OR ADDITIONAL CRITERIA
AS AGENT MAY, AT ITS OPTION, ESTABLISH WITH RESPECT THERETO IN ACCORDANCE WITH
THIS AGREEMENT AND SUBJECT TO SUCH RESERVES AS AGENT MAY ESTABLISH IN CONNECTION
WITH THE ACQUIRED BUSINESS, AND IN THE CASE OF ELIGIBLE INVENTORY ACQUIRED
PURSUANT TO A PERMITTED ACQUISITION TO THE EXTENT THAT IT HAS BEEN SUBJECT TO AN
APPRAISAL THAT SATISFIES THE REQUIREMENTS OF SECTION 7.3 HEREOF),
(F)
IN THE CASE OF THE ACQUISITION OF CAPITAL STOCK OF ANY PERSON OR THE
FORMATION OF ANY SUBSIDIARY IN CONNECTION WITH SUCH ACQUISITION, (I) THE
BORROWER OR GUARANTOR FORMING SUCH SUBSIDIARY SHALL, EXCEPT AS AGENT MAY
OTHERWISE AGREE, (A) EXECUTE AND DELIVER TO AGENT, A PLEDGE AND SECURITY
AGREEMENT, IN