Document:

exh10_3.htm

    
      Exhibit
10.3

      

      

      

       

      

      

      Export-Import
Bank of the United States

      Working
Capital Guarantee Program

      

      

      

       

      Borrower
Agreement

       

      
        
          
            

          

           

        

        
          
          

          
            

          

        

        
           

        

      

      

       

      TABLE
OF CONTENTS

       

      
        	
                ARTICLE I

              	
                DEFINITIONS

              	
                1

              
	
                1.01

              	
                Definition of Terms

              	
                1

              
	
                1.02

              	
                Rules of Construction

              	
                14

              
	
                1.03

              	
                Incorporation of Recitals

              	
                15

              
	
                ARTICLE II

              	
                OBLIGATIONS OF BORROWER

              	
                15

              
	
                2.01

              	
                Use of Credit
Accommodations

              	
                15

              
	
                2.02

              	
                Security Interests

              	
                15

              
	
                2.03

              	
                Loan Documents and Loan Authorization
      Agreement

              	
                16

              
	
                2.04

              	
                Export-Related Borrowing Base Certificates and
      Export Orders

              	
                16

              
	
                2.05

              	
                Schedules, Reports and Other
      Statements

              	
                16

              
	
                2.06

              	
                Exclusions from the Export-Related Borrowing
      Base

              	
                16

              
	
                2.07

              	
                Borrowings and Reborrowings

              	
                17

              
	
                2.08

              	
                Repayment Terms

              	
                17

              
	
                2.09

              	
                Financial Statements

              	
                17

              
	
                2.10

              	
                Additional Security or
    Payment

              	
                17

              
	
                2.11

              	
                Continued Security Interest

              	
                18

              
	
                2.12

              	
                Inspection of Collateral and
      Facilities

              	
                18

              
	
                2.13

              	
                General Intangibles

              	
                19

              
	
                2.14

              	
                Economic Impact Approval

              	
                19

              
	
                2.15

              	
                Indirect Exports

              	
                19

              
	
                2.16

              	
                Overseas Inventory and Accounts
      Receivable

              	
                20

              
	
                2.17

              	
                Country Limitation Schedule

              	
                21

              
	
                2.18

              	
                Notice of Certain Event

              	
                21

              
	
                2.19

              	
                Insurance

              	
                22

              
	
                2.20

              	
                Taxes

              	
                22

              
	
                2.21

              	
                Compliance with Laws

              	
                22

              
	
                2.22

              	
                Negative Covenants

              	
                22

              
	
                2.23

              	
                Cross Default

              	
                22

              
	
                2.24

              	
                Munitions List

              	
                22

              

      

       

      
        
          
          

        

        
          i

          
            

          

        

        
          
          

        

      

      
        	
                2.25

              	
                Suspension and Debarment,
    etc

              	
                22

              
	
                ARTICLE III

              	
                RIGHTS AND REMEDIES

              	
                23

              
	
                3.01

              	
                Indemnification

              	
                23

              
	
                3.02

              	
                Liens

              	
                23

              
	
                ARTICLE IV

              	
                MISCELLANEOUS

              	
                24

              
	
                4.01

              	
                Governing Law

              	
                24

              
	
                4.02

              	
                Notification

              	
                24

              
	
                4.03

              	
                Partial Invalidity

              	
                24

              
	
                4.04

              	
                Waiver of Jury Trial

              	
                24

              
	
                4.05

              	
                Consequential Damages

              	
                24

              

      

      

      
        
          
             

             

          

           

        

        
          ii

          
            

          

        

        
           

        

      

      Export-Import
Bank of the United States

      Working
Capital Guarantee Program

      Borrower
Agreement

       

      THIS
BORROWER AGREEMENT (this "Agreement") is made and entered into by the entity
identified as Borrower on the signature page hereof ("Borrower") in favor of the
Export-Import Bank of the United States ("Ex-Im Bank") and the institution
identified as Lender on the signature page hereof ("Lender").

      

      RECITALS

      Borrower
has requested that Lender establish a Loan Facility in favor of Borrower for the
purposes of providing Borrower with working capital to finance the manufacture,
production or purchase and subsequent export sale of Items.

      

      Lender
and Borrower expect that Ex-Im Bank will provide a guarantee to Lender regarding
this Loan Facility subject to the terms and conditions of the Master Guarantee
Agreement, a Loan Authorization Agreement, and to the extent applicable, the
Delegated Authority Letter Agreement or Fast Track Lender
Agreement.

      

      Lender
and Ex-Im Bank have requested that Borrower execute this Agreement as a
condition precedent to Lender establishing the Loan Facility and Ex-Im Bank
providing the guarantee.

      

      NOW,
THEREFORE, Borrower hereby agrees as follows:

      

      ARTICLE
I

      DEFINITIONS

      

      1.01           Definition of
Terms.  As used in this Agreement, including the Recitals to
this Agreement and the Loan Authorization Agreement, the following terms shall
have the following meanings:

      

      "Accounts
Receivable" shall mean all of Borrower's now owned or hereafter acquired (a)
"accounts" (as such term is defined in the UCC), other receivables, book debts
and other forms of obligations, whether arising out of goods sold or services
rendered or from any other transaction; (b) rights in, to and under all purchase
orders or receipts for goods or services; (c) rights to any goods represented or
purported to be represented by any of the foregoing (including unpaid sellers’
rights of rescission, replevin, reclamation and stoppage in transit and rights
to returned, reclaimed or repossessed goods); (d) moneys due or to become due to
such Borrower under all purchase orders and contracts (which includes Export
Orders) for the sale of goods or the performance of services or both by Borrower
(whether or not yet earned by performance on the part of Borrower), including
the proceeds of the foregoing; (e) any notes, drafts, letters of credit,
insurance proceeds or other instruments, documents and writings evidencing or
supporting the foregoing; and (f) all collateral security and guarantees of
any kind given by any other Person with respect to any of the
foregoing.

      

      
        
          
          

        

        
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      “Accounts
Receivable Aging Report” shall mean a report detailing the Export-Related
Accounts Receivable and Export-Related Overseas Accounts Receivable for a Loan
Facility, and the applicable terms for the relevant time period; in the case of
Indirect Exports, such report shall indicate the portion of such Accounts
Receivables corresponding to Indirect Exports.

      

      "Advance
Rate" shall mean, with respect to a Loan Facility, the rate specified in Section
5.C. of the Loan Authorization Agreement for each category of Primary Collateral
except for Export-Related General Intangibles and Other
Collateral.  Unless otherwise set forth in writing by Ex-Im Bank, in
no event shall the Advance Rate exceed (i) ninety percent (90%) for Eligible
Export-Related Accounts Receivable, (ii) seventy five percent (75%) for Eligible
Export-Related Inventory, (iii) seventy percent (70%) for Eligible
Export-Related Overseas Accounts Receivable or (iv) sixty percent (60%) for
Eligible Export-Related Overseas Inventory and (v) twenty five percent (25%) for
Retainage Accounts Receivable.

      

      “Affiliated
Foreign Person” shall have the meaning set forth in Section 2.15.

      

      "Business
Day" shall mean any day on which the Federal Reserve Bank of New York is open
for business.

      

      "Buyer"
shall mean a Person that has entered into one or more Export Orders with
Borrower or who is an obligor on Export-Related Accounts Receivable or
Export-Related Overseas Accounts Receivable.

      

      “Capital
Good” shall mean a capital good (e.g., manufacturing equipment, licensing
agreements) that will establish or expand foreign production capacity of an
exportable good.

      

      "Collateral" shall mean all real and
personal property and interest in real and personal property in or upon which
Lender has been, or shall be, granted a Lien as security for the payment of all
the Loan Facility Obligations and all products and proceeds (cash and non-cash)
thereof.

      

      "Commercial
Letters of Credit" shall mean those letters of credit subject to the UCP payable
in Dollars and issued or caused to be issued by Lender on behalf of Borrower
under a Loan Facility for the benefit of a supplier(s) of Borrower in connection
with Borrower's purchase of goods or services from the supplier in support of
the export of the Items.

      

      "Country
Limitation Schedule" shall mean the schedule published from time to time by
Ex-Im Bank setting forth on a country by country basis whether and under what
conditions Ex-Im Bank will provide coverage for the financing of export
transactions to countries listed therein.

      

      “Credit
Accommodation Amount” shall mean, the sum of (a) the aggregate outstanding
amount of Disbursements and (b) the aggregate outstanding Letter of Credit
Obligations, which sum may not exceed the Maximum Amount.

      

      "Credit
Accommodations" shall mean, collectively, Disbursements and Letter of Credit
Obligations.

      

      
        
          
          

        

        
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      "Debarment
Regulations" shall mean, collectively, (a) the Governmentwide Debarment and
Suspension (Nonprocurement) regulations (Common Rule), 53 Fed. Reg. 19204 (May
26, 1988), (b) Subpart 9.4 (Debarment, Suspension, and Ineligibility) of the
Federal Acquisition Regulations, 48 C.F.R. 9.400-9.409 and (c) the revised
Governmentwide Debarment and Suspension (Nonprocurement) regulations (Common
Rule), 60 Fed. Reg. 33037 (June 26, 1995).

      

      "Delegated
Authority Letter Agreement" shall mean the Delegated Authority Letter Agreement,
if any, between Ex-Im Bank and Lender.

      

      "Disbursement"
shall mean, collectively, (a) an advance of a working capital loan from Lender
to Borrower under the Loan Facility, and (b) an advance to fund a drawing under
a Letter of Credit issued or caused to be issued by Lender for the account of
Borrower under the Loan Facility.

      

      "Dollars"
or "$" shall mean the lawful currency of the United States.

      

      “Economic
Impact Approval” shall mean a written approval issued by Ex-Im Bank stating the
conditions under which a Capital Good may be included as an Item in a Loan
Facility consistent with Ex-Im Bank’s economic impact procedures (or other
mechanism for making this determination that Ex-Im Bank notifies Lender of in
writing).

      

      “Economic
Impact Certification” shall have the meaning set forth in Section
2.14(b).

      

      "Effective
Date" shall mean the date on which (a) all of the Loan Documents have been
executed by Lender, Borrower and, if applicable, Ex-Im Bank and (b) all of the
conditions to the making of the initial Credit Accommodations under the Loan
Documents or any amendments thereto have been satisfied.

      

      "Eligible
Export-Related Accounts Receivable" shall mean Export-Related Accounts
Receivable which are acceptable to Lender and which are deemed to be eligible
pursuant to the Loan Documents, but in no event shall Eligible Export-Related
Accounts Receivable include any Account Receivable:

      

      (a)           that
does not arise from the sale of Items in the ordinary course of Borrower's
business;

      

      (b)           that
is not subject to a valid, perfected first priority Lien in favor of
Lender;

      

      (c)           as
to which any covenant, representation or warranty contained in the Loan
Documents with respect to such Account Receivable has been
breached;

      

      (d)           that
is not owned by Borrower or is subject to any right, claim or interest of
another Person other than the Lien in favor of Lender;

      

      (e)           with
respect to which an invoice has not been sent;

      

      (f)           that
arises from the sale of defense articles or defense services;

      

      
        
          
          

        

        
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      (g)           that
arises from the sale of Items to be used in the construction, alteration,
operation or maintenance of nuclear power, enrichment, reprocessing, research or
heavy water production facilities unless with Ex-Im Bank’s prior written
consent;

      

      (h)           that
is due and payable from a Buyer located in a country with which Ex-Im Bank is
prohibited from doing business as designated in the Country Limitation
Schedule;

      

      (i)           that
does not comply with the requirements of the Country Limitation
Schedule;

      

      (j)           that
is due and payable more than one hundred eighty (180) days from the date of the
invoice;

      

      (k)           that
is not paid within sixty (60) calendar days from its original due date, unless
it is insured through Ex-Im Bank export credit insurance for comprehensive
commercial and political risk, or through Ex-Im Bank approved private insurers
for comparable coverage, in which case it is not paid within ninety (90)
calendar days from its due date;

      

      (l)           of
a Buyer for whom fifty percent (50%) or more of the Accounts Receivable of such
Buyer do not satisfy the requirements of subclauses (j) and (k)
above;

      

      (m)           that
arises from a sale of goods to or performance of services for an employee of
Borrower, a stockholder of Borrower, a subsidiary of Borrower, a Person with a
controlling interest in Borrower or a Person which shares common controlling
ownership with Borrower;

      

      (n)           that
is backed by a letter of credit unless the Items covered by the subject letter
of credit have been shipped;

      

      (o)           that
Lender or Ex-Im Bank, in its reasonable judgment, deems uncollectible for any
reason;

      

      (p)           that
is due and payable in a currency other than Dollars, except as may be approved
in writing by Ex-Im Bank;

      

      (q)           that
is due and payable from a military Buyer, except as may be approved in writing
by Ex-Im Bank;

      

      (r)           that
does not comply with the terms of sale set forth in Section 7 of the Loan
Authorization Agreement;

      

      (s)           that
is due and payable from a Buyer who (i) applies for, suffers, or consents to the
appointment of, or the taking of possession by, a receiver, custodian, trustee
or liquidator of itself or of all or a substantial part of its property or calls
a meeting of its creditors, (ii) admits in writing its inability, or is
generally unable, to pay its debts as they become due or ceases operations of
its present business, (iii) makes a general assignment for the benefit of
creditors, (iv) commences a voluntary case under any state or federal bankruptcy
laws (as now or hereafter in effect), (v) is adjudicated as bankrupt or
insolvent, (vi) files a petition seeking to take advantage of any other law
providing for the relief of debtors, (vii) acquiesces to, or fails to have
dismissed, any petition which is filed against it in any involuntary case under
such bankruptcy laws, or (viii) takes any action for the purpose of effecting
any of the foregoing;

      

      
        
          
          

        

        
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      (t)           that
arises from a bill-and-hold, guaranteed sale, sale-and-return, sale on approval,
consignment or any other repurchase or return basis or is evidenced by chattel
paper;

      

      (u)           for
which the Items giving rise to such Accounts Receivable have not been shipped to
the Buyer or when the Items are services, such services have not been performed
or when the Export Order specifies a timing for invoicing the Items other than
shipment or performance and the Items have not been invoiced in accordance with
such terms of the Export Order, or the Accounts Receivable otherwise do not
represent a final sale;

      

      (v)           that
is subject to any offset, deduction, defense, dispute, or counterclaim or the
Buyer is also a creditor or supplier of Borrower or the Account Receivable is
contingent in any respect or for any reason;

      

      (w)           for
which Borrower has made any agreement with the Buyer for any deduction
therefrom, except for discounts or allowances made in the ordinary course of
business for prompt payment, all of which discounts or allowances are reflected
in the calculation of the face value of each respective invoice related
thereto;

      

      (x)           for
which any of the Items giving rise to such Account Receivable have been
returned, rejected or repossessed;

      

      (y)           that
is included as an eligible receivable under any other credit facility to which
Borrower is a party;

      

      (z)           any
of the Items giving rise to such Accounts Receivable are Capital Goods, unless
the transaction is in accordance with Section 2.14;

      

      (aa)           that
is due and payable from a Buyer that is, or is located in, the United States;
provided however, that this subsection (aa) shall not preclude an Export-Related
Accounts Receivable arising from the sale of Items to foreign contractors or
subcontractors providing services to a United States Embassy or the United
States Military located overseas from being deemed an Eligible Export-Related
Accounts Receivable; or

      

      (bb)           that
arises from the sale of Items that do not meet the U.S. Content requirements in
accordance with Section 2.01(b)(ii).

      

      "Eligible
Export-Related Inventory" shall mean Export-Related Inventory which is
acceptable to Lender and which is deemed to be eligible pursuant to the Loan
Documents, but in no event shall Eligible Export-Related Inventory include any
Inventory:

      

      (a)           that
is not subject to a valid, perfected first priority Lien in favor of
Lender;

      

      (b)           that
is located at an address that has not been disclosed to Lender in
writing;

      

      
        
          
          

        

        
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      (c)           that
is placed by Borrower on consignment or held by Borrower on consignment from
another Person;

      

      (d)           that
is in the possession of a processor or bailee, or located on premises leased or
subleased to Borrower, or on premises subject to a mortgage in favor of a Person
other than Lender, unless such processor or bailee or mortgagee or the lessor or
sublessor of such premises, as the case may be, has executed and delivered all
documentation which Lender shall require to evidence the subordination or other
limitation or extinguishment of such Person's rights with respect to such
Inventory and Lender's right to gain access thereto;

      

      (e)           that
is produced in violation of the Fair Labor Standards Act or subject to the "hot
goods" provisions contained in 29 U.S.C.§215 or any successor statute or
section;

      

      (f)           as
to which any covenant, representation or warranty with respect to such Inventory
contained in the Loan Documents has been breached;

      

      (g)           that
is not located in the United States unless expressly permitted by Lender, on
terms acceptable to Lender;

      

      (h)           that
is an Item or is to be incorporated into Items that do not meet U.S. Content
requirements in accordance with Section 2.01(b)(ii);

      

      (i)           that
is demonstration Inventory;

       

      (j)           that
consists of proprietary software (i.e. software designed solely for Borrower's
internal use and not intended for resale);

      

      (k)           that
is damaged, obsolete, returned, defective, recalled or unfit for further
processing;

      

      (l)           that
has been previously exported from the United States;

      

      (m)           that
constitutes, or will be incorporated into Items that constitute, defense
articles or defense services;

      

      (n)           that
is an Item or will be incorporated into Items that will be used in the
construction, alteration, operation or maintenance of nuclear power, enrichment,
reprocessing, research or heavy water production facilities unless with Ex-Im
Bank’s prior written consent;

      

      (o)           that
is an Item or is to be incorporated into Items destined for shipment to a
country as to which Ex-Im Bank is prohibited from doing business as designated
in the Country Limitation Schedule;

      

      (p)           that
is an Item or is to be incorporated into Items destined for shipment to a Buyer
located in a country in which Ex-Im Bank coverage is not available for
commercial reasons as designated in the Country Limitation Schedule, unless and
only to the extent that such Items are to be sold to such country on terms of a
letter of credit confirmed by a bank acceptable to Ex-Im Bank;

       

      
        
          
          

        

        
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      (q)           that
constitutes, or is to be incorporated into, Items whose sale would result in an
Accounts Receivable which would not be an Eligible Export-Related Accounts
Receivable;

      

      (r)           that
is included as eligible inventory under any other credit facility to which
Borrower is a party; or

      

      (s)           that
is, or is to be incorporated into, an Item that is a Capital Good, unless the
transaction is in accordance with Section 2.14.

      

      "Eligible
Export-Related Overseas Accounts Receivable" shall mean Export-Related Overseas
Accounts Receivable which are acceptable to Lender and which are deemed to be
eligible pursuant to the Loan Documents but in no event shall include the
Accounts Receivable (a) through (bb) excluded from the definition of Eligible
Export-Related Accounts Receivable.

       

      “Eligible
Export-Related Overseas Inventory" shall mean Export-Related Overseas Inventory
which is acceptable to Lender and which is deemed to be eligible pursuant to the
Loan Documents, but in no event shall include the Inventory (a) through (r)
excluded from the definition of Eligible Export-Related Inventory.

      

      "Eligible
Person" shall mean a sole proprietorship, partnership, limited liability
partnership, corporation or limited liability company which (a) is domiciled,
organized or formed, as the case may be, in the United States, whether or not
such entity is owned by a foreign national or foreign entity; (b) is in good
standing in the state of its formation or otherwise authorized to conduct
business in the United States; (c) is not currently suspended or debarred from
doing business with the United States government or any instrumentality,
division, agency or department thereof; (d) exports or plans to export Items;
(e) operates and has operated as a going concern for at least one (1) year; (f)
has a positive tangible net worth determined in accordance with GAAP; and (g)
has revenue generating operations relating to its core business activities for
at least one year.  An Affiliated Foreign Person that meets all of the
requirements of the foregoing definition of Eligible Person other than subclause
(a) thereof shall be deemed to be an Eligible Person

      

      "ERISA"
shall mean the Employee Retirement Income Security Act of 1974 and the rules and
regulations promulgated thereunder

      .

      "Export
Order" shall mean a documented purchase order or contract evidencing a Buyer’s
agreement to purchase the Items from Borrower for export from the United States,
which documentation shall include written information that is necessary to
confirm such purchase order or contract, including identification of the Items,
the name of the Buyer, the country of destination, contact information for the
Buyer and the total amount of the purchase order or contract; in the case of
Indirect Exports, such documentation shall further include a copy of the written
purchase order or contract from a foreign purchaser or other documentation
clearly evidencing a foreign purchaser’s agreement to purchase the
Items.

       

      "Export-Related
Accounts Receivable" shall mean those Accounts Receivable arising from the sale
of Items which are due and payable to Borrower in the United
States.

      

      
        
          
          

        

        
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      "Export-Related
Accounts Receivable Value" shall mean, at the date of determination thereof, the
aggregate face amount of Eligible Export-Related Accounts Receivable less taxes,
discounts, credits, allowances and Retainages, except to the extent otherwise
permitted by Ex-Im Bank in writing.

      

      "Export-Related
Borrowing Base" shall mean, at the date of determination thereof, the sum of (a)
(if Lender elects to include) the Export-Related Inventory Value or
Export-Related Historical Inventory Value multiplied by the Advance Rate
applicable to Eligible Export-Related Inventory set forth in Section 5.B.(1.) of
the Loan Authorization Agreement, plus (b) the Export-Related Accounts
Receivable Value multiplied by the Advance Rate applicable to Eligible
Export-Related Accounts Receivable set forth in Section 5.B.(2.) of the Loan
Authorization Agreement, plus (c) if permitted by Ex-Im Bank in writing, the
Retainage Value multiplied by the Advance Rate applicable to Retainages set
forth in Section 5.B.(3.) of the Loan Authorization Agreement, plus (d) the
Other Assets set forth in Section 5.B.(4.) of the Loan Authorization Agreement
multiplied by the Advance Rate agreed to in writing by Ex-Im Bank, plus (e) if
permitted by Ex-Im Bank in writing, the Export-Related Overseas Accounts
Receivable Value multiplied by the Advance Rate applicable to Eligible
Export-Related Overseas Accounts Receivable set forth in Section 5.B.(5.) of the
Loan Authorization Agreement, plus (f) if permitted by Ex-Im Bank in writing,
the Export-Related Overseas Inventory Value multiplied by the Advance Rate
applicable to Eligible Export-Related Overseas Inventory set forth in Section
5.B.(6.) of the Loan Authorization Agreement, less (g) the amounts required to
be reserved pursuant to Sections 4.12 and 4.13 of this Agreement for each
outstanding Letter of Credit, less (h) such reserves and in such amounts deemed
necessary and proper by Lender from time to time.

      

      "Export-Related
Borrowing Base Certificate" shall mean a certificate in the form provided or
approved by Lender, executed by Borrower and delivered to Lender pursuant to the
Loan Documents detailing the Export-Related Borrowing Base supporting the Credit
Accommodations which reflects, to the extent included in the Export-Related
Borrowing Base, Export-Related Accounts Receivable, Eligible Export-Related
Accounts Receivable, Export-Related Inventory, Eligible Export-Related
Inventory, Export-Related Overseas Accounts Receivable, Eligible Export-Related
Accounts Receivable, Export-Related Overseas Inventory and Eligible
Export-Related Overseas Inventory balances that have been reconciled with
Borrower's general ledger, Accounts Receivable Aging Report and Inventory
schedule.

      

      "Export-Related
General Intangibles" shall mean the Pro Rata Percentage of General Intangibles
determined as of the earlier of: (i) the date such General Intangibles are
liquidated and (ii) the date Borrower fails to pay when due any outstanding
amount of principal or accrued interest payable under the Loan Documents that
becomes the basis for a Payment Default on which a Claim is filed.

      

      “Export-Related
Historical Inventory Value” shall mean with respect to a Borrower, the relevant
Export-Related Sales Ratio multiplied by the lowest of (i) the cost of such
Borrower’s Inventory as determined in accordance with GAAP, or (ii) the market
value of such Borrower’s Inventory as determined in accordance with GAAP or
(iii) the appraised or orderly liquidation value of such Borrower’s Inventory,
if Lender has loans and financial accommodations to such Borrower for which it
conducts (or contracts for the performance of) such an appraised or orderly
liquidation value.

      

      
        
          
          

        

        
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      "Export-Related
Inventory" shall mean the Inventory of Borrower located in the United States
that has been purchased, manufactured or otherwise acquired by Borrower for sale
or resale as Items, or to be incorporated into Items to be sold or resold
pursuant to Export Orders.

      

      "Export-Related
Inventory Value" shall mean, at the date of determination thereof, the lowest of
(i) the cost of Eligible Exported-Related Inventory as determined in accordance
with GAAP, or (ii) the market value of Eligible Export-Related Inventory as
determined in accordance with GAAP or (iii) the lower of the appraised market
value or orderly liquidation value of the Eligible Export-Related Inventory, if
Lender has other loans and financial accommodations to a Borrower for which it
conducts (or contracts for the performance of) such an appraised or orderly
liquidation value.

      

      "Export-Related
Overseas Accounts Receivable" shall mean those Accounts Receivable arising from
the sale of Items which are due and payable outside of the United States either
to a Borrower or an Affiliated Foreign Person.

      

      "Export-Related
Overseas Accounts Receivable Value" shall mean, with respect to a Loan Facility,
at the date of determination thereof, the aggregate face amount of Eligible
Export-Related Overseas Accounts Receivable less taxes, discounts, credits,
allowances and Retainages, except to the extent otherwise permitted by Ex-Im
Bank in writing.

      

      "Export-Related
Overseas Inventory" shall mean the Inventory of Borrower located outside of the
United States that has been purchased, manufactured or otherwise acquired by
such Borrower for sale or resale as Items, or to be incorporated into Items to
be sold or resold pursuant to Export Orders.

      

      “Export-Related
Overseas Inventory Value” shall mean, at the date of determination thereof, the
lowest of (i) the cost of Eligible Export-Related Overseas Inventory as
determined in accordance with GAAP, (ii) the market value of Eligible
Export-Related Overseas Inventory as determined in accordance with GAAP or (iii)
the appraised or orderly liquidation value of the Eligible Export-Related
Overseas Inventory, if Lender has other loans and financial accommodations to
Borrower or an Affiliated Foreign Person for which it conducts (or contracts for
the performance of) such a appraised or orderly liquidation.

      

      “Export-Related
Sales Ratio” shall mean with respect to a Borrower, the percentage of such
Borrower’s total sales revenue derived from the sale of Eligible Export-Related
Inventory over a rolling twelve-month period ending no more than ninety (90)
days prior to the date of the relevant Export-Related Borrowing Base
Certificate

      

      "Extension"
shall mean, with respect to a Loan Facility, an amendment to the Loan
Authorization Agreement extending the Final Disbursement Date on the same terms
and conditions as the Loan Facility for an aggregate period not to exceed one
hundred and twenty (120) days beyond the original Final Disbursement Date,
either as agreed to in writing by Ex-Im Bank or, in the case of Delegated
Authority, as notified by Lender to Ex-Im Bank pursuant to its authority under
the Delegated Authority Letter Agreement.

      

      
        
          
          

        

        
          9

          
            

          

        

        
          
          

        

      

      “Fast
Track Lender Agreement” shall mean the Fast Track Lender Agreement, if any,
between Ex-Im Bank and Lender.

      

      "Final
Disbursement Date" shall mean the last date on which Lender may make a
Disbursement set forth in Section 10 of the Loan Authorization Agreement
(including as amended by an Extension) or, if such date is not a Business Day,
the next succeeding Business Day; provided, however, to the
extent that Lender has not received cash collateral in the amount of the Letter
of Credit Obligations or an equivalent full indemnity from Borrower or
Guarantor, as applicable, with respect to Letter of Credit Obligations
outstanding on the Final Disbursement Date, the Final Disbursement Date with
respect to an advance to fund a drawing under such Letter of Credit shall be no
later than thirty (30) days after any such drawing which may be no later than
the expiry date of the Letter of Credit related thereto.

      

      "GAAP"
shall mean the generally accepted accounting principles issued in the United
States.

      

      "General
Intangibles" shall mean all intellectual property and other "general
intangibles" (as such term is defined in the UCC).

      

      "Guarantor"
shall mean any Person which is identified in Section 3 of the Loan Authorization
Agreement who shall guarantee (jointly and severally if more than one) the
payment and performance of all or a portion of the Loan Facility
Obligations.

      

      "Guarantee
Agreement" shall mean a valid and enforceable agreement of guarantee executed by
each Guarantor in favor of Lender.

      

      “Indirect
Exports” shall mean finished goods or services that are sold by a Borrower to a
Buyer located in the United States, are intended for export from the United
States, and are identified in Section 4.A.(2.) of the Loan Authorization
Agreement.

      

      "Inventory"
shall mean all "inventory" (as such term is defined in the UCC), now or
hereafter owned or acquired by Borrower, wherever located, including all
inventory, merchandise, goods and other personal property which are held by or
on behalf of Borrower for sale or lease or are furnished or are to be furnished
under a contract of service or which constitute raw materials, work in process
or materials used or consumed or to be used or consumed in Borrower's business
or in the processing, production, packaging, promotion, delivery or shipping of
the same, including other supplies.

      

      “ISP”
shall mean the International Standby Practices-ISP98, International Chamber of
Commerce Publication No. 590 and any amendments and revisions
thereof.

      

      “Issuing
Bank” shall mean the bank that issues a Letter of Credit, which bank is Lender
itself or a bank that Lender has caused to issue a Letter of Credit by way of a
guarantee or reimbursement obligation.

      

      "Items"
shall mean the finished goods or services which are intended for export from the
United States, either directly or as an Indirect Export, meet the U.S. Content
requirements in accordance with Section 2.01(b)(ii) of this Agreement and are
specified in Section 4.A. of the Loan Authorization Agreement.

      

      
        
          
          

        

        
          10

          
            

          

        

        
          
          

        

      

      "Letter
of Credit" shall mean a Commercial Letter of Credit or a Standby Letter of
Credit.

      

      "Letter
of Credit Obligations" shall mean all undrawn amounts of outstanding obligations
incurred by Lender, whether direct or indirect, contingent or otherwise, due or
not due, in connection with the issuance or guarantee by Lender or Issuing Bank
of Letters of Credit.

      

      "Lien"
shall mean any mortgage, security deed or deed of trust, pledge, hypothecation,
assignment, deposit arrangement, lien, charge, claim, security interest,
security title, easement or encumbrance, or preference, priority or other
security agreement or preferential arrangement of any kind or nature whatsoever
(including any lease or title retention agreement, any financing lease having
substantially the same economic effect as any of the foregoing, and the filing
of, or agreement to give, any financing statement perfecting a security interest
under the UCC or comparable law of any jurisdiction) by which property is
encumbered or otherwise charged.

      

      "Loan
Agreement" shall mean a valid and enforceable agreement between Lender and a
Borrower setting forth, with respect to each Loan Facility, the terms and
conditions of such Loan Facility.

      

      "Loan
Authorization Agreement" shall mean, as applicable, the duly executed Loan
Authorization Agreement, Fast Track Loan Authorization Agreement, or the Loan
Authorization Notice, setting forth certain terms and conditions of each Loan
Facility, a copy of which is attached hereto as Annex A.

      

      "Loan
Authorization Notice" shall mean the Loan Authorization Notice executed by
Lender and delivered to Ex-Im Bank in accordance with the Delegated Authority
Letter Agreement setting forth the terms and conditions of each Loan
Facility.

      

      "Loan
Documents" shall mean the Loan Authorization Agreement, the Loan Agreement, this
Agreement, each promissory note (if applicable), each Guarantee Agreement, and
all other instruments, agreements and documents now or hereafter executed by the
applicable Borrower, any Guarantor, Lender or Ex-Im Bank evidencing, securing,
guaranteeing or otherwise relating to the Loan Facility or any Credit
Accommodations made thereunder.

      

      "Loan
Facility" shall mean the Revolving Loan Facility, the Transaction Specific Loan
Facility or the Transaction Specific Revolving Loan Facility established by
Lender in favor of Borrower under the Loan Documents.

      

      "Loan
Facility Obligations" shall mean all loans, advances, debts, expenses, fees,
liabilities, and obligations, including any accrued interest thereon, for the
performance of covenants, tasks or duties or for payment of monetary amounts
(whether or not such performance is then required or contingent, or amounts are
liquidated or determinable) owing by Borrower to Lender, of any kind or nature,
present or future, arising in connection with the Loan Facility.

      

      "Loan
Facility Term" shall mean, with respect to a Loan Facility, the number of months
or portion thereof from the Effective Date to the Final Disbursement Date as set
forth in the Loan Authorization Agreement as amended.

      

      
        
          
          

        

        
          11

          
            

          

        

        
          
          

        

      

      "Master
Guarantee Agreement" shall mean the Master Guarantee Agreement between Ex-Im
Bank and Lender, as amended, modified, supplemented and restated from time to
time.

      

      "Material
Adverse Effect" shall mean a material adverse effect on (a) the business,
assets, operations, prospects or financial or other condition of Borrower or any
Guarantor, (b) any Borrower's ability to pay or perform the Loan Facility
Obligations in accordance with the terms thereof, (c) the Collateral or Lender's
Liens on the Collateral or the priority of such Lien, or (d) Lender's rights and
remedies under the Loan Documents.

      

      "Maximum
Amount" shall mean the maximum Credit Accommodation Amount that may be
outstanding at any time under each Loan Facility, as specified in Section 5.A.
of the Loan Authorization Agreement.

      

      “Other
Assets” shall mean, with respect to a Loan Facility, such other assets of a
Borrower to be included in Primary Collateral, which may include cash and
marketable securities, or such other assets as Ex-Im Bank agrees to in writing,
and disclosed as Primary Collateral in Section 6.A. of the Loan Authorization
Agreement.  The applicable Advance Rate (to be multiplied by the Other
Asset Value) shall be as agreed to by Ex-Im Bank in writing case by case by case
and set forth in Section 5.B.(4) of the Loan Authorization
Agreement.

      

      “Other
Asset Value” shall mean, with respect to a Loan Facility, at the date of
determination thereof, the value of the Other Assets as determined in accordance
with GAAP.

      

      “Other
Collateral” shall mean any additional collateral that Lender customarily would
require as security for loan facilities on its own account and risk where the
permitted borrowing level is based principally on a borrowing base derived from
a borrower’s inventory and accounts receivable, but where such additional
collateral does not enter into the borrowing base calculation.

      

      "Permitted
Liens" shall mean (a) Liens for taxes, assessments or other governmental charges
or levies not delinquent, or, being contested in good faith and by appropriate
proceedings and with respect to which proper reserves have been taken by
Borrower; provided, that, the Lien shall
have no effect on the priority of the Liens in favor of Lender or the value of
the assets in which Lender has such a Lien and a stay of enforcement of any such
Lien shall be in effect; (b) deposits or pledges securing obligations under
worker's compensation, unemployment insurance, social security or public
liability laws or similar legislation; (c) deposits or pledges securing bids,
tenders, contracts (other than contracts for the payment of money), leases,
statutory obligations, surety and appeal bonds and other obligations of like
nature arising in the ordinary course of Borrower's business; (d) judgment Liens
that have been stayed or bonded; (e) mechanics', workers', materialmen's or
other like Liens arising in the ordinary course of Borrower's business with
respect to obligations which are not due; (f) Liens placed upon fixed assets
hereafter acquired to secure a portion of the purchase price thereof, provided,
that, any such Lien shall not encumber any other property of Borrower; (g)
security interests being terminated concurrently with the execution of the Loan
Documents; and (h) Liens disclosed in Section 6.D. of the Loan Authorization
Agreement, provided
that, except as otherwise permitted by Ex-Im Bank in writing, such Liens
in Section 6.D. shall be subordinate to the Liens in favor of Lender on Primary
Collateral.

      

      
        
          
          

        

        
          12

          
            

          

        

        
          
          

        

      

      "Person"
shall mean any individual, sole proprietorship, partnership, limited liability
partnership, joint venture, trust, unincorporated organization, association,
corporation, limited liability company, institution, public benefit corporation,
entity or government (whether national, federal, provincial, state, county,
city, municipal or otherwise, including any instrumentality, division, agency,
body or department thereof), and shall include such Person's successors and
assigns.

      

      "Pro Rata
Percentage" shall mean, with respect to a Loan Facility, as of the date of
determination thereof, the principal balance of the Credit Accommodations
outstanding as a percentage of the combined principal balance of all loans from
Lender to such Borrower including the then outstanding principal balance of the
Credit Accommodations plus unfunded amounts under outstanding Letters of
Credit.

      

      "Principals"
shall mean any officer, director, owner, partner, key employee, or other Person
with primary management or supervisory responsibilities with respect to Borrower
or any other Person (whether or not an employee) who has critical influence on
or substantive control over the transactions covered by this
Agreement.

      

      "Retainage"
shall mean that portion of the purchase price of an Export Order that a Buyer is
not obligated to pay until the end of a specified period of time following the
satisfactory performance under such Export Order.

      

      "Retainage
Accounts Receivable" shall mean those portions of Eligible Export-Related
Accounts Receivable or Eligible Export-Related Overseas Accounts Receivable
arising out of a Retainage.

      

      “Retainage
Value" shall mean, at the date of determination thereof, the aggregate face
amount of Retainage Accounts Receivable as permitted by Ex-Im Bank in writing,
less taxes, discounts, credits and allowances, except to the extent otherwise
permitted by Ex-Im Bank in writing.

      

      "Revolving
Loan Facility" shall mean the credit facility or portion thereof established by
Lender in favor of Borrower for the purpose of providing working capital in the
form of loans and/or Letters of Credit to finance the manufacture, production or
purchase and subsequent export sale of Items pursuant to Loan Documents under
which Credit Accommodations may be made and repaid on a continuous basis based
solely on credit availability on the Export-Related Borrowing Base during the
term of such credit facility

      

      "Special
Conditions" shall mean those conditions, if any, set forth in Section 13 of the
Loan Authorization Agreement.

      

      "Specific
Export Orders" shall mean those Export Orders specified in Section 5.D. of the
Loan Authorization Agreement as applicable for a Transaction Specific Revolving
Loan Facility or a Transaction Specific Loan Facility.

      

      
        
          
          

        

        
          13

          
            

          

        

        
          
          

        

      

      “Standby
Letters of Credit” shall mean those letters of credit subject to the ISP or UCP
issued or caused to be issued by Lender for Borrower's account that can be drawn
upon by a Buyer only if Borrower fails to perform all of its obligations with
respect to an Export Order.

      

      "Transaction
Specific Loan Facility" shall mean a credit facility or a portion thereof
established by Lender in favor of Borrower for the purpose of providing working
capital in the form of loans and/or Letters of Credit to finance the
manufacture, production or purchase and subsequent export sale of Items pursuant
to Loan Documents under which Credit Accommodations are made based solely on
credit availability on the Export-Related Borrowing Base relating to Specific
Export Orders and once such Credit Accommodations are repaid they may not be
reborrowed.

      

      "Transaction
Specific Revolving Loan Facility" shall mean a Revolving Credit Facility
established to provide financing of Specific Export Orders.

      

      "UCC"
shall mean the Uniform Commercial Code, as the same may be in effect from time
to time in the relevant United States jurisdiction.

      

      "UCP"
shall mean the Uniform Customs and Practice for Documentary Credits (1993
Revision), International Chamber of Commerce Publication No. 500 and any
amendments and revisions thereof.

       

      "U.S." or
"United States" shall mean the United States of America including any division
or agency thereof (including United States embassies or United States military
bases located overseas), and any United States Territory (including without
limitation, Puerto Rico, Guam or the United States Virgin Islands).

      

      "U.S.
Content" shall mean, with respect to any Item, all the costs, including labor,
materials, services and overhead, but not markup or profit margin, which are of
U.S. origin or manufacture, and which are incorporated into an Item in the
United States.

      

      "Warranty"
shall mean Borrower’s guarantee to Buyer that the Items will function as
intended during the warranty period set forth in the applicable Export
Order.

      

      "Warranty
Letter of Credit" shall mean a Standby Letter of Credit which is issued or
caused to be issued by Lender to support the obligations of Borrower with
respect to a Warranty or a Standby Letter of Credit which by its terms becomes a
Warranty Letter of Credit.

      

      1.02           Rules of
Construction.  For purposes of this Agreement, the following
additional rules of construction shall apply, unless specifically indicated to
the contrary: (a) wherever from the context it appears appropriate, each term
stated in either the singular or plural shall include the singular and the
plural, and pronouns stated in the masculine, feminine or neuter gender shall
include the masculine, the feminine and the neuter; (b) the term "or" is not
exclusive; (c) the term "including" (or any form thereof) shall not be limiting
or exclusive; (d) all references to statutes and related regulations shall
include any amendments of same and any successor statutes and regulations; (e)
the words "this Agreement", "herein", "hereof", "hereunder" or other words of
similar import refer to this Agreement as a whole including the schedules,
exhibits, and annexes hereto as the same may be amended, modified or
supplemented; (f) all references in this Agreement to sections, schedules,
exhibits, and annexes shall refer to the corresponding sections, schedules,
exhibits, and annexes of or to this Agreement; and (g) all references to any
instruments or agreements, including references to any of the Loan Documents,
the Delegated Authority Letter Agreement, or the Fast Track Lender Agreement
shall include any and all modifications, amendments and supplements thereto and
any and all extensions or renewals thereof to the extent permitted under this
Agreement.

      

      
        
          
          

        

        
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      1.03           Incorporation of
Recitals.  The Recitals to this Agreement are incorporated into
and shall constitute a part of this Agreement.

      

      ARTICLE
II

      OBLIGATIONS
OF BORROWER

      Until
payment in full of all Loan Facility Obligations and termination of the Loan
Documents, Borrower agrees as follows:

       

      2.01           Use of Credit
Accommodations.  (a) Borrower shall use Credit Accommodations
only for the purpose of enabling Borrower to finance the cost of manufacturing,
producing, purchasing or selling the Items.  Borrower may not use any
of the Credit Accommodations for the purpose of: (i) servicing or repaying any
of Borrower's pre-existing or future indebtedness unrelated to the Loan Facility
unless approved by Ex-Im Bank in writing; (ii) acquiring fixed assets or capital
assets for use in Borrower's business; (iii) acquiring, equipping or renting
commercial space outside of the United States; (iv) paying the salaries of non
U.S. citizens or non-U.S. permanent residents who are located in offices outside
of the United States; or (v) in connection with a Retainage or Warranty unless
approved by Ex-Im Bank in writing.

      

       (b)           In
addition, no Credit Accommodation may be used to finance the manufacture,
purchase or sale of any of the following:

       

      (i)           Items
to be sold to a Buyer located in a country as to which Ex-Im Bank is prohibited
from doing business as designated in the Country Limitation
Schedule;

      

      (ii)          that
part of the cost of the Items which is not U.S. Content unless such part is not
greater than fifty percent (50%) of the cost of the Items and is incorporated
into the Items in the United States;

      

      (iii)         defense
articles or defense services;

      

      (iv)         Capital
Goods unless in accordance with Section 2.14 of this Agreement; or

      

      (v)           without
Ex-Im Bank's prior written consent, any Items to be used in the construction,
alteration, operation or maintenance of nuclear power, enrichment, reprocessing,
research or heavy water production facilities.

      

      
        
          
          

        

        
          15

          
            

          

        

        
          
          

        

      

      2.02           Security
Interests.  Borrower agrees to cooperate with Lender in any
steps Lender shall take to file and maintain valid, enforceable and perfected
security interests in the Collateral.

      

      2.03           Loan Documents and Loan
Authorization Agreement.  (a)  This Agreement and
each of the other Loan Documents applicable to Borrower have been duly executed
and delivered on behalf of Borrower, and are and will continue to be legal and
valid obligations of Borrower, enforceable against it in accordance with its
terms.

      

      (b)           Borrower
shall comply with all of the terms and conditions of this Agreement, the Loan
Authorization Agreement and each of the other Loan Documents to which it is a
party.

      

      (c)           Borrower
hereby represents and warrants to Lender that Borrower is an Eligible
Person.

      

      2.04           Export-Related Borrowing
Base Certificates and Export Orders.  (a) In order to receive
Credit Accommodations under the Loan Facility, Borrower shall have delivered to
Lender an Export-Related Borrowing Base Certificate as frequently as required by
Lender but at least within the past month, together with a copy of the Export
Order(s) or, for Revolving Loan Facilities, if permitted by Lender, a written
summary of the Export Orders (when Eligible Export-Related Inventory and
Eligible Overseas Export-Related Inventory are entering the Export-Related
Borrowing Base) against which Borrower is requesting Credit
Accommodations.  In addition, so long as there are any Credit
Accommodations outstanding under the Loan Facility, Borrower shall deliver to
Lender an Export-Related Borrowing Base Certificate at least once each
month.  Lender shall determine if daily electronic reporting
reconciled monthly may substitute for monthly Export-Related Borrowing Base
Certificates.  If the Lender requires an Export-Related Borrowing Base
Certificate more frequently, Borrower shall deliver such Export-Related
Borrowing Base Certificate as required by Lender.

      

      (b)           If
Lender permits summaries of Export Orders, Borrower shall also deliver promptly
to Lender copies of any Export Orders requested by Lender.

      

      2.05           Schedules, Reports and Other
Statements.  With the delivery of each Export-Related Borrowing
Base Certificate required in Section 2.04 above, Borrower shall submit to Lender
in writing (a) an Inventory schedule for the preceding month, as applicable, and
(b) an Accounts Receivable Aging Report for the preceding
month.  Borrower shall also furnish to Lender promptly upon request
such information, reports, contracts, invoices and other data concerning the
Collateral as Lender may from time to time specify.

      

      2.06           Exclusions from the
Export-Related Borrowing Base.  In determining the
Export-Related Borrowing Base, Borrower shall exclude therefrom Inventory which
are not Eligible Export-Related Inventory or Eligible Export-Related Overseas
Inventory and Accounts Receivable which are not Eligible Export-Related Accounts
Receivable or Eligible Export-Related Overseas Accounts
Receivable.  Borrower shall promptly, but in any event within five (5)
Business Days, notify Lender (a) if any then existing Export-Related Inventory
or Export-Related Overseas Inventory no longer constitutes Eligible
Export-Related Inventory or Eligible Export-Related Overseas Inventory, as
applicable or (b) of any event or circumstance which to Borrower’s knowledge
would cause Lender to consider any then existing Export-Related Accounts
Receivable or Export-Related Overseas Accounts Receivable as no longer
constituting an Eligible Export-Related Accounts Receivable or Eligible
Export-Related Overseas Accounts Receivable, as applicable.

      

      
        
          
          

        

        
          16

          
            

          

        

        
          
          

        

      

      2.07           Borrowings and
Reborrowings.  (a)                                                                           If
the Loan Facility is a Revolving Loan Facility or Transaction Specific Revolving
Loan Facility, provided that
Borrower is not in default under any of the Loan Documents, Borrower may borrow,
repay and reborrow amounts under such Loan Facility up to the credit available
on the current Export-Related Borrowing Base Certificate subject to the terms of
this Agreement and each of the other Loan Documents until the close of business
on the Final Disbursement Date.

      

      (b)           If
the Loan Facility is a Transaction Specific Loan Facility, provided that
Borrower is not in default under any of the Loan Documents, Borrower may borrow
(but not reborrow) amounts under the Loan Facility up to the credit available on
the current Export-Related Borrowing Base Certificate subject to the terms of
this Agreement and each of the other Loan Documents until the close of business
on the Final Disbursement Date.

      

      2.08           Repayment
Terms.  (a)   The Borrower on a Revolving Loan
Facility shall pay in full the outstanding Loan Facility Obligations no later
than the first Business Day after the Final Disbursement Date unless such Loan
Facility is renewed or extended by Lender consistent with procedures required by
Ex-Im Bank.

      

      (b)           The
Borrower on a Transaction Specific Loan Facility and a Transaction Specific
Revolving Loan Facility shall, within two (2) Business Days of the receipt
thereof, pay to Lender (for application against the outstanding Loan Facility
Obligations) all checks, drafts, cash and other remittances it may receive in
payment or on account of the Export-Related Accounts Receivable, Export-Related
Overseas Accounts Receivable or any other Collateral, in precisely the form
received (except for the endorsement of Borrower where
necessary).  Pending such deposit, Borrower shall hold such amounts in
trust for Lender separate and apart and shall not commingle any such items of
payment with any of its other funds or property.  Unless a Transaction
Specific Loan Facility or Transaction Specific Revolving Loan Facility is
renewed or extended by Lender consistent with procedures required by Ex-Im Bank,
Borrower shall pay in full all outstanding Loan Facility Obligations no later
than the first Business Day after the Final Disbursement Date, except for
Eligible Export-Related Accounts Receivables and Eligible Export-Related
Overseas Accounts Receivable outstanding as of the Final Disbursement Date and
due and payable after such date, for which the principal and accrued and unpaid
interest thereon shall be due and payable no later than the first Business Day
after the date such Accounts Receivable are due and payable.

      

      2.09           Financial
Statements.  Borrower shall deliver to Lender the financial
statements required to be delivered by Borrower in accordance with Section 11 of
the Loan Authorization Agreement.

      

      
        
          
          

        

        
          17

          
            

          

        

        
          
          

        

      

      2.10           Additional Security or
Payment.  (a)  Borrower shall at all times ensure
that the Export-Related Borrowing Base equals or exceeds the aggregate
outstanding amount of Disbursements.  If informed by Lender or if
Borrower otherwise has actual knowledge that the Export-Related Borrowing Base
is at any time less than the aggregate outstanding amount of Disbursements,
Borrower shall, within five (5) Business Days, either (i) furnish additional
Collateral to Lender, in form and amount satisfactory to Lender and Ex-Im Bank
or (ii) pay to Lender an amount equal to the difference between the aggregate
outstanding amount of Disbursements and the Export-Related Borrowing
Base.

      

      (b)           For
purposes of this Agreement, in determining the Export-Related Borrowing Base
there shall be deducted from the Export-Related Borrowing Base an amount equal
to (i) twenty-five percent (25%) of the undrawn amount of outstanding Commercial
Letters of Credit and Standby Letters of Credit and (ii) one hundred percent
(100%) of the undrawn amount of outstanding Warranty Letters of Credit less the amount of
cash collateral held by Lender to secure Warranty Letters of
Credit.

      

      (c)           Unless
otherwise approved in writing by Ex-Im Bank, for Revolving Loan Facilities
(other than Transaction Specific Revolving Loan Facilities), Borrower shall at
all times ensure that the sum of the outstanding amount of Disbursements and the
undrawn amount of outstanding Commercial Letters of Credit that is supported by
Eligible Export-Related Inventory or Eligible Export-Related Overseas Inventory
(discounted by the relevant Advance Rate percentages) in the Export-Related
Borrowing Base does not exceed sixty percent (60%) of the sum of the total
outstanding amount of Disbursements and the undrawn amount of all outstanding
Commercial Letters of Credit.  If informed by Lender or if Borrower
otherwise has actual knowledge that the sum of the outstanding amount of
Disbursements and the undrawn amount of outstanding Commercial Letters of Credit
that is supported by such Inventory exceeds sixty percent (60%) of the sum of
the total outstanding Disbursements and the undrawn amount of all outstanding
Commercial Letters of Credit, Borrower shall, within five (5) Business Days,
either (i) furnish additional non-Inventory Collateral to Lender, in form and
amount satisfactory to Lender and Ex-Im Bank, or (ii) pay down the applicable
portion of the outstanding Disbursements or  (iii) reduce the undrawn
amount of outstanding Commercial Letters of Credit such that the above described
ratio is not exceeded.

      

      (d)           If
informed by Lender or if Borrower otherwise has actual knowledge that the
conditions of Section 2.16(g) are at any time not being met, Borrower shall,
within five (5) Business Days, either (i) furnish additional Collateral to
Lender that is not Eligible Export-Related Overseas Accounts Receivable or
Eligible Export-Related Overseas Inventory, in form and amount satisfactory to
Lender and Ex-Im Bank, or (ii) remove from the Export-Related Borrowing Base the
portion of Eligible Export-Related Overseas Accounts Receivable or Eligible
Export-Related Overseas Inventory that supports greater than fifty percent (50%)
of the Export-Related Borrowing Base.

       

      2.11           Continued Security
Interest.  Borrower shall not change (a) its name or identity
in any manner, (b) the location of its principal place of business or its
jurisdiction of organization or formation, (c) the location of any of the
Collateral or (d) the location of any of the books or records related to the
Collateral, in each instance without giving thirty (30) days prior written
notice thereof to Lender and taking all actions deemed necessary or appropriate
by Lender to continuously protect and perfect Lender’s Liens upon the
Collateral.

      

      
        
          
          

        

        
          18

          
            

          

        

        
          
          

        

      

      2.12           Inspection of Collateral and
Facilities.  (a)  Borrower shall permit the
representatives of Lender and Ex-Im Bank to make at any time during normal
business hours inspections of the Collateral and of Borrower's facilities,
activities, and books and records, and shall cause its officers and employees to
give full cooperation and assistance in connection therewith.

      

      (b)           Borrower
agrees to facilitate Lender’s conduct of field examinations at Borrower’s
facilities in accordance with the time schedule and content for such
examinations that Lender requests.  Such field examinations shall
address at a minimum: (x) the value of the Collateral against which Credit
Accommodations may be provided, (y) the amount, if any, that the aggregate
outstanding amount of Disbursements exceeds the Export-Related Borrowing Base
and (z) whether such Borrower is in material compliance with the terms of each
of the Loan Documents.  Such field examinations shall include an
inspection and evaluation of the Export-Related Inventory and Export-Related
Overseas Inventory, a book audit of Export-Related Accounts Receivable and
Export-Related Overseas Accounts Receivable, a review of the Accounts Receivable
Aging Reports and a review of Borrower’s compliance with any Special
Conditions.  Lenders who opt to use the Export-Related Historical
Inventory Value in the Export-Related Borrowing Base calculation shall reconcile
those numbers against the calculation for the relevant time periods using the
Export-Related Inventory Value.  Whenever Export-Related Accounts
Receivable or Export-Related Inventory derived from Indirect Exports are in the
Export-Related Borrowing Base, Lender shall verify compliance with Section 2.15
herein, including taking a random sampling of ultimate foreign
purchasers.

      

      2.13           General
Intangibles.  Borrower represents and warrants that it owns, or
is licensed to use, all General Intangibles necessary to conduct its business as
currently conducted except where the failure of Borrower to own or license such
General Intangibles could not reasonably be expected to have a Material Adverse
Effect.

      

      2.14           Economic Impact
Approval.   (a)  For Loan Facilities up to and
including $10 million, Borrower acknowledges that Capital Goods may not be
included as Items, and Export-Related Inventory, Export-Related Overseas
Inventory, Export-Related Accounts Receivable and Export-Related Overseas
Accounts Receivable in connection with the sale of such Capital Goods may not be
included in the Export-Related Borrowing Base, if such Capital Goods would
enable a foreign buyer to establish or expand production of a product where, as
of the date of the Economic Impact Certification covering such Item: (i) the
Buyer is subject to a Final Anti-Dumping (AD) or Countervailing Duty (CVD)
order, or a Suspension Agreement arising from a AD or CVD investigation, and
such product is substantially the same as the product that is the subject of the
AD/CVD order or suspension agreement; or (ii) the Buyer is the subject of a
Section 201 injury determination by the International Trade Commission (“ITC”)
and such product is substantially the same as a product that is the subject of
the ITC injury determination.  Borrower may consult with Ex-Im Bank
regarding the appropriate application of this Section 2.14(a) and may, at its
option, request that Ex-Im Bank issue an Economic Impact Approval covering any
Items listed in Section 4.A. of the Loan Authorization Agreement.  For
Loan Facilities over $10 million involving Items that are Capital Goods,
Borrower shall obtain from Ex-Im Bank, and abide by, an Economic Impact Approval
covering all Items listed in Section 4(A) of the Loan Authorization
Agreement.

      

      
        
          
          

        

        
          19

          
            

          

        

        
          
          

        

      

                 (b)      Borrower
shall provide Lender with a certification in the form of Annex B (an “Economic
Impact Certification”) covering the Items stated in Section 4(A) of the Loan
Authorization Agreement prior to Lender including such Items in the Loan
Authorization Agreement.  Prior to Lender amending the Loan
Authorization Agreement to include additional Items, Borrower shall provide
Lender with an additional Economic Impact Certification covering such additional
Items.

      

      2.15           Indirect Exports.  Indirect
Exports may be included as Items in a Loan Facility provided that funds
available under such Loan Facility’s Export-Related Borrowing Base supported by
Accounts Receivable and Inventory derived from Indirect Exports at no time
exceed ten percent (10%) of the Maximum Amount of such Loan Facility, and provided, further that (a) the
ultimate foreign buyer for the Items must be located in a country in which Ex-Im
Bank is not
legally prohibited from doing business in accordance with the Country Limitation
Schedule, and (b) the Borrower must make available to Lender verifiable evidence
of intent to export the Indirect Exports from the United States, which evidence
may be contained in the Export Orders and Accounts Receivable Aging Reports and
supporting documents.  Lender must obtain written consent from Ex-Im
Bank prior to including funds derived from Indirect Exports in an Export-Related
Borrowing Base above the ten percent (10%) threshold.

      

      2.16           Overseas Inventory and
Accounts Receivable.  Upon the prior written consent of Ex-Im
Bank, Export-Related Overseas Accounts Receivable and Export-Related Overseas
Inventory of a Borrower or of an Affiliated Foreign Person (as defined below)
may be included in the Export-Related Borrowing Base provided that conditions
required by Ex-Im Bank, including the following, are met:

      

      (a)           the
Affiliated Foreign Person, if any, has been approved by Ex-Im Bank;

      

      (b)           the
Affiliated Foreign Person, if any, is a Borrower under the relevant
Loan  Facility;

      

      (c)           notwithstanding
the Maximum Amount of the Loan Facility, all payments due and payable on such
Export-Related Overseas Accounts Receivable are collected through a cash
collateral account under Lender’s control;

      

      (d)           as
of the Effective Date, or such later date when the Export-Related Overseas
Accounts Receivable and/or Export-Related Overseas Inventory are added to the
Loan Facility, Lender has obtained a valid and enforceable first priority Lien
in the Export-Related Overseas Accounts Receivable and Export-Related Overseas
Inventory, as applicable;

      

      (e)           as
of the Effective Date, or such later date when the Export-Related Overseas
Accounts Receivable and/or Export-Related Overseas Inventory are added to the
Loan Facility, Lender has obtained a legal opinion confirming the security
interest in the Export-Related Overseas Accounts Receivable and Export-Related
Overseas Inventory;

      

      
        
          
          

        

        
          20

          
            

          

        

        
          
          

        

      

      (f)           the
Export-Related Overseas Accounts Receivable are due and payable in United States
Dollars or other currency acceptable to Ex-Im Bank; and

      

      (g)          at
no time may the portion of the Export-Related Borrowing Base derived from
Eligible Export-Related Overseas Accounts Receivable and Eligible Export-Related
Overseas Inventory exceed fifty percent (50%) of the Export-Related Borrowing
Base.

      

                               For
purposes hereof, an “Affiliated Foreign Person” shall mean a subsidiary or
affiliate of a Borrower on the same Loan Facility, which has duly executed as a
Borrower all of the applicable Loan Documents and any other documents required
by Ex-Im Bank, meets all of the requirements of the definition of Eligible
Person other than subclause (a) thereof and is in good standing in the country
of its formation or otherwise authorized to conduct business in such
country.

      

      2.17           Country Limitation
Schedule.  Unless otherwise informed in writing by Lender or
Ex-Im Bank, Borrower shall be entitled to rely on the last copy of the Country
Limitation Schedule distributed from Lender to Borrower.

      

      2.18           Notice of Certain
Events.  Borrower shall promptly, but in any event within five
(5) Business Days, notify Lender in writing of the occurrence of any of the
following:

      

      (a)           Borrower
or any Guarantor (i) applies for, consents to or suffers the appointment of, or
the taking of possession by, a receiver, custodian, trustee, liquidator or
similar fiduciary of itself or of all or a substantial part of its property or
calls a meeting of its creditors, (ii) admits in writing its inability, or is
generally unable, to pay its debts as they become due or ceases operations of
its present business, (iii) makes a general assignment for the benefit of
creditors, (iv) commences a voluntary case under any state or federal bankruptcy
laws (as now or hereafter in effect), (v) is adjudicated as bankrupt or
insolvent, (vi) files a petition seeking to take advantage of any other law
providing for the relief of debtors, (vii) acquiesces to, or fails to have
dismissed within thirty (30) days, any petition filed against it in any
involuntary case under such bankruptcy laws, or (vii) takes any action for the
purpose of effecting any of the foregoing;

      

      (b)           any
Lien in any of the Collateral, granted or intended by the Loan Documents to be
granted to Lender, ceases to be a valid, enforceable, perfected, first priority
Lien (or a lesser priority if expressly permitted pursuant to Section 6 of the
Loan Authorization Agreement) subject only to Permitted Liens;

      

      (c)           the
issuance of any levy, assessment, attachment, seizure or Lien, other than a
Permitted Lien, against any of the Collateral which is not stayed or lifted
within thirty (30) calendar days;

      (d)           any
proceeding is commenced by or against Borrower or any Guarantor for the
liquidation of its assets or dissolution;

       

      
        
          
          

        

        
          21

          
            

          

        

        
          
          

        

      

      (e)           any
litigation is filed against Borrower or any Guarantor which has had or could
reasonably be expected to have a Material Adverse Effect and such litigation is
not withdrawn or dismissed within thirty (30) calendar days of the filing
thereof;

      

      (f)           any
default or event of default under the Loan Documents;

      

      (g)           any
failure to comply with any terms of the Loan Authorization
Agreement;

      

      (h)           any
material provision of this Agreement or any other Loan Document for any reason
ceases to be valid, binding and enforceable in accordance with its
terms;

      

      (i)           any
event which has had or could reasonably be expected to have a Material Adverse
Effect; or

      

      (j)           the
aggregate outstanding amount of Disbursements exceeds the applicable
Export-Related Borrowing Base.

      

      2.19           Insurance.  Borrower
will at all times carry property, liability and other insurance, with insurers
acceptable to Lender, in such form and amounts, and with such deductibles and
other provisions, as Lender shall require, and Borrower will provide evidence of
such insurance to Lender on the proper Acord Form, so that Lender is satisfied
that such insurance is, at all times, in full force and effect.  Each
property insurance policy shall name Lender as loss payee or mortgagee and shall
contain a lender's loss payable endorsement in form acceptable to Lender and
each liability insurance policy shall name Lender as an additional
insured.  All policies of insurance shall provide that they may not be
cancelled or changed without at least thirty (30) days' prior written notice to
Lender and shall otherwise be in form and substance satisfactory to
Lender.  Borrower will promptly deliver to Lender copies of all
reports made to insurance companies.

      

      2.20           Taxes.  Borrower
has timely filed all tax returns and reports required by applicable law, has
timely paid all applicable taxes, assessments, deposits and contributions owing
by Borrower and will timely pay all such items in the future as they became due
and payable.  Borrower may, however, defer payment of any contested
taxes; provided, that Borrower (a) in good faith contests Borrower's
obligation to pay such taxes by appropriate proceedings promptly and diligently
instituted and conducted; (b) notifies Lender in writing of the
commencement of, and any material development in, the proceedings;
(c) posts bonds or takes any other steps required to keep the contested
taxes from becoming a Lien upon any of the Collateral; and (d) maintains
adequate reserves therefore in conformity with GAAP.

      

      2.21           Compliance with
Laws.  Borrower represents and warrants that it has complied in
all material respects with all provisions of all applicable laws and
regulations, including those relating to Borrower's ownership of real or
personal property, the conduct and licensing of Borrower's business, the payment
and withholding of taxes, ERISA and other employee matters, safety and
environmental matters.

      

      2.22           Negative
Covenants.  Without the prior written consent of Ex-Im Bank and
Lender, Borrower shall not: (a) merge, consolidate or otherwise combine with any
other Person; (b) acquire all or substantially all of the assets or capital
stock of any other Person; (c) sell, lease, transfer, convey, assign or
otherwise dispose of any of its assets, except for the sale of Inventory in the
ordinary course of business and the disposition of obsolete equipment in the
ordinary course of business; (d) create any Lien on the Collateral except for
Permitted Liens; (e) make any material changes in its organizational structure
or identity; or (f) enter into any agreement to do any of the
foregoing.

      

      
        
          
          

        

        
          22

          
            

          

        

        
          
          

        

      

      2.23           Cross
Default.  Borrower shall be deemed in default under the Loan
Facility if Borrower fails to pay when due any amount payable to Lender under
any loan or other credit accommodations to Borrower whether or not guaranteed by
Ex-Im Bank.

      

      2.24           Munitions
List.  If any of the Items are articles, services, or related
technical data that are listed on the United States Munitions List (part 121 of
title 22 of the Code of Federal Regulations), Borrower shall send a written
notice promptly, but in any event within five (5) Business Days, of Borrower
learning thereof to Lender describing the Items(s) and the corresponding invoice
amount

      .

      2.25           Suspension and Debarment,
etc.  On the date of this Agreement neither Borrower nor its
Principals are (a) debarred, suspended, proposed for debarment with a final
determination still pending, declared ineligible or voluntarily excluded (as
such terms are defined under any of the Debarment Regulations referred to below)
from participating in procurement or nonprocurement transactions with any United
States federal government department or agency pursuant to any of the Debarment
Regulations or (b) indicted, convicted or had a civil judgment rendered against
Borrower or any of its Principals for any of the offenses listed in any of the
Debarment Regulations.  Unless authorized by Ex-Im Bank, Borrower will
not knowingly enter into any transactions in connection with the Items with any
person who is debarred, suspended, declared ineligible or voluntarily excluded
from participation in procurement or nonprocurement transactions with any United
States federal government department or agency pursuant to any of the Debarment
Regulations.  Borrower will provide immediate written notice to Lender
if at any time it learns that the certification set forth in this Section 2.24
was erroneous when made or has become erroneous by reason of changed
circumstances.

      

      ARTICLE
III

      RIGHTS
AND REMEDIES

      

      3.01           Indemnification.  Upon
Ex-Im Bank's payment of a Claim to Lender in connection with the Loan Facility
pursuant to the Master Guarantee Agreement, Ex-Im Bank may assume all rights and
remedies of Lender under the Loan Documents and may enforce any such rights or
remedies against Borrower, the Collateral and any
Guarantors.  Borrower shall hold Ex-Im Bank and Lender harmless from
and indemnify them against any and all liabilities, damages, claims, costs and
losses incurred or suffered by either of them resulting from (a) any materially
incorrect certification or statement knowingly made by Borrower or its agent to
Ex-Im Bank or Lender in connection with the Loan Facility, this Agreement, the
Loan Authorization Agreement or any other Loan Documents or (b) any material
breach by Borrower of the terms and conditions of this Agreement, the Loan
Authorization Agreement or any of the other Loan Documents.  Borrower
also acknowledges that any statement, certification or representation made by
Borrower in connection with the Loan Facility is subject to the penalties
provided in Article 18 U.S.C. Section 1001.

      

      
        
          
          

        

        
          23

          
            

          

        

        
          
          

        

      

      3.02           Liens.  Borrower
agrees that any and all Liens granted by it to Lender are also hereby granted to
Ex-Im Bank to secure Borrower’s obligation, however arising, to reimburse Ex-Im
Bank for any payments made by Ex-Im Bank pursuant to the Master Guarantee
Agreement.  Lender is authorized to apply the proceeds of, and
recoveries from, any property subject to such Liens to the satisfaction of Loan
Facility Obligations in accordance with the terms of any agreement between
Lender and Ex-Im Bank.

      
        
          
            

             

                                                                                                                                            

             

          

           

        

        
          24

          
            

          

        

        
           

        

      

      ARTICLE
IV

      MISCELLANEOUS

      

      4.01           Governing
Law.  This Agreement and the obligations arising under this
Agreement shall be governed by, and construed in accordance with, the law of the
state governing the Loan Agreement.

      

      4.02           Notification.  All
notices required by this Agreement shall be given in the manner and to the
parties provided for in the Loan Agreement.

      

      4.03           Partial
Invalidity.  If at any time any of the provisions of this
Agreement becomes illegal, invalid or unenforceable in any respect under the law
of any jurisdiction, neither the legality, the validity nor the enforceability
of the remaining provisions hereof shall in any way be affected or
impaired.

      

      4.04           Waiver of Jury
Trial.  BORROWER HEREBY KNOWINGLY, VOLUNTARILY AND
INTENTIONALLY WAIVES ANY AND ALL RIGHTS IT MAY HAVE TO A TRIAL BY JURY IN
RESPECT OF ANY ACTION, SUIT, PROCEEDING OR OTHER LITIGATION BROUGHT TO RESOLVE
ANY DISPUTE ARISING UNDER, ARISING OUT OF OR IN CONNECTION WITH THIS AGREEMENT,
THE LOAN AUTHORIZATION AGREEMENT, ANY LOAN DOCUMENT, OR ANY OTHER AGREEMENT,
DOCUMENT OR INSTRUMENT EXECUTED OR DELIVERED IN CONNECTION HEREWITH OR THEREWITH
OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER VERBAL OR
WRITTEN), OR ACTIONS OR OMISSIONS OF LENDER, EX-IM BANK, OR ANY OTHER PERSON,
RELATING TO THIS AGREEMENT, THE LOAN AUTHORIZATION AGREEMENT OR ANY OTHER LOAN
DOCUMENT.

      

      4.05           Consequential
Damages.  Neither Ex-Im Bank, Lender nor any agent or attorney
for any of them shall be liable to Borrower for consequential damages arising
from any breach of contract, tort or other wrong relating to the establishment,
administration or collection of the Loan Facility Obligations.

      
        
           

        

        
          25

          
            

          

        

        
           

        

      

      IN
WITNESS WHEREOF, Borrower has caused this Agreement to be duly executed as of
the _28th_ day of __March_______________,
_2008_.

       

      

      _GSE
Systems, Inc._______________

      (Name of Borrower)

      

      By:__/s/ Jeffery
Hough_____________

      (Signature)

      

      Name:
Jeffery
Hough_______________

      (Print or Type)

      

      Title:_
Chief Financial
Officer____

      (Print or Type)

      

      

      GSE Power Systems,
Inc._______________

      (Name of Borrower)

      

      By:__/s/ Jeffery
Hough________________

      (Signature)

      

      Name:
Jeffery
Hough_______________

      (Print or Type)

      

      Title:_ Chief Financial
Officer____

      (Print or Type)

      

      

      

      ACKNOWLEDGED:

      

      _Bank of
America___________________

      (Name of Lender)

      

      By:______________________________

      (Signature)

      

      Name:_Elizabeth W.
Martinez_________

      (Print or Type)

      

      Title:__Vice
President________________

      (Print or Type)

      
        
           

        

        
          26

          
            

          

        

        
           

        

      

      ANNEXES:

      

      
        	
                Annex
      A         - Loan
      Authorization Agreement, Fast Track Loan Authorization Agreement or Loan
      Authorization Notice, as applicable

              

      

      Annex
B          - Economic Impact
Certification

      

      

      

      

      CONSENT
OF GUARANTORS

      

      Each of the undersigned as a Guarantor
of the obligations of Borrower to the Lender executing the foregoing Agreement
hereby agrees that the foregoing Agreement, each of their respective Guarantee
Agreements and each other Loan Documents may be assigned to the Export-Import
Bank of the United States.

      

      

      

      [CORPORATE
GUARANTOR]

      MSHI, Inc.

      By:__/s/ Jeffery Hough_________

      Name:
Jeffery
Hough___________

      Title:_
Chief Financial
Officer____

      

      

      

      [CORPORATE
GUARANTOR]

      GSE
Process Solutions, Inc.

      By:__/s/ Jeffery Hough ________

      Name:
Jeffery
Hough___________

      Title:_
Chief Financial
Officer____

      

27exh10_4.htm

    Exhibit 10.4

      

          

      BORROWER:                                    GSE Systems,
Inc.

                           GSE Power Systems,
Inc.

      

      GUARANTOR:                                GSE Process
Solutions,Inc.

      

      

      

      CONTINUING AND UNCONDITIONAL
GUARANTY

      (Ex-Im
Bank-Guaranteed Transaction Specific Revolving Line of Credit)

      

      To:           Bank
of America, N.A.

      

      

      1.  The
Guaranty.  For valuable consideration, the undersigned
("Guarantor") hereby unconditionally guarantees and promises to pay promptly to
Bank of America, N.A., its subsidiaries and affiliates (collectively, "Bank"),
or order, in lawful money of the United States, any and all Indebtedness of GSE
Systems, Inc. and GSE Power Systems, Inc. (collectively, the "Borrower") to Bank
when due, whether at stated maturity, upon acceleration or otherwise, and at all
times thereafter.  The liability of Guarantor under this Guaranty is
not limited as to the principal amount of the Indebtedness guaranteed and
includes, without limitation, liability for all interest, fees, indemnities
(including, without limitation, hazardous waste indemnities), and other costs
and expenses relating to or arising out of the Indebtedness and for all Swap
Obligations now or hereafter owing from Borrower to Bank.  The
liability of Guarantor is continuing and relates to any Indebtedness, including
that arising under successive transactions which shall either continue the
Indebtedness or from time to time renew it after it has been
satisfied.  This Guaranty is cumulative and does not supersede any
other outstanding guaranties, and the liability of Guarantor under this Guaranty
is exclusive of Guarantor's liability under any other guaranties signed by
Guarantor.  If multiple individuals or entities sign this Guaranty,
their obligations under this Guaranty shall be joint and several.  If
Guarantor is a subsidiary or affiliate of Borrower, Guarantor's liability
hereunder shall not exceed at any one time the largest amount during the period
commencing with Guarantor's execution of this Guaranty and thereafter that would
not render Guarantor's obligations hereunder subject to avoidance under Section
548 of the Bankruptcy Code (Title 11, United States Code) or any comparable
provisions of any applicable state law.

       

      2.  Definitions.

       

      
        	
                 
      

              	
                (a)  "Bank
      Agreements" shall mean all agreements, documents, and instruments
      evidencing any of the Indebtedness, including but not limited to all loan
      agreements between Borrower and Bank and promissory notes from Borrower in
      favor of Bank, and all deeds of trust, mortgages, security agreements, and
      other agreements, documents, and instruments executed by Borrower in
      connection with the Indebtedness, all as now in effect and as hereafter
      amended, restated, renewed, or
superseded.

              

      

       

      
        	
                 
      

              	
                (b)  "Borrower"
      shall mean the individual or the entity named in Paragraph 1 of this
      Guaranty and, if more than one, then any one or more of
    them.

              

      

      

      
        	
                 
      

              	
                (c)  "Guarantor"
      shall mean the individual or the entity signing this Guaranty and, if more
      than one, then any one or more of
them.

              

      

      

      (d)  "Indebtedness"
shall mean, with respect to that certain Ex-Im Bank-Guaranteed Transaction
Specific Revolving Line of Credit and related agreements, documents and
instruments entered into between Bank and Borrower as of even date herewith, as
now in effect and as amended, renewed or restated in the future, any and all
debts, liabilities, and obligations of Borrower to Bank, now or hereafter
existing, whether voluntary or involuntary and however arising, whether direct
or indirect or acquired by Bank by assignment, succession, or otherwise, whether
due or not due, absolute or contingent, liquidated or unliquidated, determined
or undetermined, held or to be held by Bank for its own account or as agent for
another or others, whether Borrower may be liable individually or jointly with
others, whether recovery upon such debts, liabilities, and obligations may be or
hereafter become barred by any statute of limitations, and whether such debts,
liabilities, and obligations may be or hereafter become otherwise
unenforceable.  Indebtedness includes, without limitation, any and all
Swap Obligations and any and all obligations of Borrower to Bank for reasonable
attorneys' fees and all other costs and expenses incurred by Bank in the
collection or enforcement of any debts, liabilities, and obligations of Borrower
to Bank.

      

      
        
          
          

        

        
          1

          
            

          

        

        
          
          

        

      

      
        	
                 
      

              	
                (e)  “Swap
      Obligations” shall mean all obligations of Borrower arising under any
      interest rate, credit, commodity or equity swap, cap, floor, collar,
      forward foreign exchange transaction, currency swap, cross currency rate
      swap, currency option, securities puts, calls, collars, options or
      forwards or any combination of, or option with respect to, these or
      similar transactions now or hereafter entered into between Borrower and
      Bank.

              

      

      

      3.  Obligations
Independent.  The obligations hereunder are independent of the
obligations of Borrower or any other guarantor, and a separate action or actions
may be brought and prosecuted against Guarantor whether action is brought
against Borrower or any other guarantor or whether Borrower or any other
guarantor be joined in any such action or actions.  Anyone executing
this Guaranty shall be bound by its terms without regard to execution by anyone
else.

      

      4.  Rights of
Bank.  Guarantor authorizes Bank, without notice or demand and
without affecting its liability hereunder, from time to time to:

      

      
        	
                 
      

              	
                (a)  renew,
      compromise, extend, accelerate, or otherwise change the time for payment,
      or otherwise change the terms, of the Indebtedness or any part thereof,
      including increase or decrease of the rate of interest thereon, or
      otherwise change the terms of any Bank
  Agreements;

              

      

      

      
        	
                 
      

              	
                (b)  receive
      and hold security for the payment of this Guaranty or any Indebtedness and
      exchange, enforce, waive, release, fail to perfect, sell, or otherwise
      dispose of any such security;

              

      

      

      
        	
                 
      

              	
                (c)  apply
      such security and direct the order or manner of sale thereof as Bank in
      its discretion may determine;

              

      

      

      
        	
                 
      

              	
                (d)  release
      or substitute any Guarantor or any one or more of any endorsers or other
      guarantors of any of the Indebtedness;
and

              

      

      

      
        	
                 
      

              	
                (e)  permit
      the Indebtedness to exceed Guarantor's liability under this Guaranty, and
      Guarantor agrees that any amounts received by Bank from any source other
      than Guarantor shall be deemed to be applied first to any portion of the
      Indebtedness not guaranteed by
Guarantor.

              

      

      

      5.  Guaranty to be
Absolute.  Guarantor agrees that until the Indebtedness has
been paid in full and any commitments of Bank or facilities provided by Bank
with respect to the Indebtedness have been terminated, Guarantor shall not be
released by or because of the taking, or failure to take, any action that might
in any manner or to any extent vary the risks of Guarantor under this Guaranty
or that, but for this paragraph, might discharge or otherwise reduce, limit, or
modify Guarantor's obligations under this Guaranty.  Guarantor waives
and surrenders any defense to any liability under this Guaranty based upon any
such action, including but not limited to any action of Bank described in the
immediately preceding paragraph of this Guaranty.  It is the express
intent of Guarantor that Guarantor’s obligations under this Guaranty are and
shall be absolute and unconditional.

      

      6.  Guarantor's Waivers of
Certain Rights and Certain Defenses.  Guarantor
waives:

      

      (a)  any right to require
Bank to proceed against Borrower, proceed against or exhaust any security for
the Indebtedness, or pursue any other remedy in Bank's power
whatsoever;

      

      
        	
                 
      

              	
                (b)  any
      defense arising by reason of any disability or other defense of Borrower,
      or the cessation from any cause whatsoever of the liability of
      Borrower;

              

      

      

      
        	
                 
      

              	
                (c)  any
      defense based on any claim that Guarantor's obligations exceed or are more
      burdensome than those of Borrower;
and

              

      

      

      
        
          
          

        

        
          2

          
            

          

        

        
          
          

        

      

      
        	
                 
      

              	
                (d)  the
      benefit of any statute of limitations affecting Guarantor's liability
      hereunder.

              

      

      

      No
provision or waiver in this Guaranty shall be construed as limiting the
generality of any other waiver contained in this Guaranty.

      

      7.  Waiver of
Subrogation.  Until the Indebtedness has been paid in full and
any commitments of Bank or facilities provided by Bank with respect to the
Indebtedness have been terminated, even though the Indebtedness may be in excess
of Guarantor’s liability hereunder, Guarantor waives to the extent permitted by
applicable law any right of subrogation, reimbursement, indemnification, and
contribution (contractual, statutory, or otherwise) including, without
limitation, any claim or right of subrogation under the Bankruptcy Code (Title
11, United States Code) or any successor statute, arising from the existence or
performance of this Guaranty, and Guarantor waives to the extent permitted by
applicable law any right to enforce any remedy that Bank now has or may
hereafter have against Borrower, and waives any benefit of, and any right to
participate in, any security now or hereafter held by Bank.

      

      8.  Waiver of
Notices.  Guarantor waives all presentments, demands for
performance, notices of nonperformance, protests, notices of protest, notices of
dishonor, notices of intent to accelerate, notices of acceleration, notices of
any suit or any other action against Borrower or any other person, any other
notices to any party liable on any Bank Agreement (including Guarantor), notices
of acceptance of this Guaranty, notices of the existence, creation, or incurring
of new or additional Indebtedness to which this Guaranty applies or any other
Indebtedness of Borrower to Bank, and notices of any fact that might increase
Guarantor’s risk.

      

      9.  Security.  To
secure all of Guarantor's obligations hereunder, Guarantor assigns and grants to
Bank a security interest in all moneys, securities, and other property of
Guarantor now or hereafter in the possession of Bank, all deposit accounts of
Guarantor maintained with Bank, and all proceeds thereof.  Upon
default or breach of any of Guarantor's obligations to Bank, Bank may apply any
deposit account to reduce the Indebtedness, and may foreclose any collateral as
provided in the Uniform Commercial Code and in any security agreements between
Bank and Guarantor.

      

      10.  Subordination.  Any
obligations of Borrower to Guarantor, now or hereafter existing, including but
not limited to any obligations to Guarantor as subrogee of Bank or resulting
from Guarantor's performance under this Guaranty, are hereby subordinated to the
Indebtedness.  In addition to Guarantor's waiver of any right of
subrogation as set forth in this Guaranty with respect to any obligations of
Borrower to Guarantor as subrogee of Bank, Guarantor agrees that, if Bank so
requests, Guarantor shall not demand, take, or receive from Borrower, by setoff
or in any other manner, payment of any other obligations of Borrower to
Guarantor until the Indebtedness has been paid in full and any commitments of
Bank or facilities provided by Bank with respect to the Indebtedness have been
terminated.  If any payments are received by Guarantor in violation of
such waiver or agreement, such payments shall be received by Guarantor as
trustee for Bank and shall be paid over to Bank on account of the Indebtedness,
but without reducing or affecting in any manner the liability of Guarantor under
the other provisions of this Guaranty.  Any security interest, lien,
or other encumbrance that Guarantor may now or hereafter have on any property of
Borrower is hereby subordinated to any security interest, lien, or other
encumbrance that Bank may have on any such property.

      

      11.  Revocation of
Guaranty.

      

      
        	
                 
      

              	
                (a)  This
      Guaranty may be revoked at any time by Guarantor in respect to future
      transactions, unless there is a continuing consideration as to such
      transactions that Guarantor does not renounce.  Such revocation
      shall be effective upon actual receipt by Bank, at the address shown below
      or at such other address as may have been provided to Guarantor by Bank,
      of written notice of revocation.  Revocation shall not affect
      any of Guarantor's obligations or Bank's rights with respect to
      transactions committed or entered into prior to Bank's receipt of such
      notice, regardless of whether or not the Indebtedness related to such
      transactions, before or after revocation, has been incurred, renewed,
      compromised, extended, accelerated, or otherwise changed as to any of its
      terms, including time for payment or increase or decrease of the rate of
      interest thereon, and regardless of any other act or omission of Bank
      authorized hereunder.  Revocation by Guarantor shall not affect any
      obligations of any other guarantor.

              

      

      

      
        	
                 
      

              	
                (b)  In
      the event of the death of a Guarantor, the liability of the estate of the
      deceased Guarantor shall continue in full force and effect as to (i) the
      Indebtedness existing at the date of death, and any renewals or extensions
      thereof, and (ii) loans or advances made to or for the account of Borrower
      after the date of the death of the deceased Guarantor pursuant to a
      commitment made by Bank to Borrower prior to the date of such
      death.  As to all surviving Guarantors, this Guaranty shall
      continue in full force and effect after the death of a Guarantor, not only
      as to the Indebtedness existing at that time, but also as to the
      Indebtedness thereafter incurred by Borrower to
  Bank.

              

      

      

      
        
          
          

        

        
          3

          
            

          

        

        
          
          

        

      

      
        	
                 
      

              	
                (c)  Guarantor
      acknowledges and agrees that this Guaranty may be revoked only in
      accordance with the foregoing provisions of this paragraph and shall not
      be revoked simply as a result of any change in name, location, or
      composition or structure of Borrower, the dissolution of Borrower, or the
      termination, increase, decrease, or other change of any personnel or
      owners of Borrower.

              

      

      

      12.  Reinstatement of
Guaranty.  If this Guaranty is revoked, returned, or canceled,
and subsequently any payment or transfer of any interest in property by Borrower
to Bank is rescinded or must be returned by Bank to Borrower, this Guaranty
shall be reinstated with respect to any such payment or transfer, regardless of
any such prior revocation, return, or cancellation.

      

      13.  Stay of
Acceleration.  In the event that acceleration of the time for
payment of any of the Indebtedness is stayed upon the insolvency, bankruptcy, or
reorganization of Borrower or otherwise, all such Indebtedness guaranteed by
Guarantor shall nonetheless be payable by Guarantor immediately if requested by
Bank.

      

      14.  No Setoff or Deductions;
Taxes.

      

      
        	
                 
      

              	
                (a)  Guarantor
      represents and warrants that it is organized and resident in the United
      States of America.  All payments by Guarantor hereunder shall be
      paid in full, without setoff or counterclaim or any deduction or
      withholding whatsoever, including, without limitation, for any and all
      present and future taxes.  If Guarantor must make a payment
      under this Guaranty, Guarantor represents and warrants that it will make
      the payment from one of its U.S. resident offices to Bank so that no
      withholding tax is imposed on the payment.  Notwithstanding the
      foregoing, if Guarantor makes a payment under this Guaranty to which
      withholding tax applies or if any taxes (other than taxes on net income
      (i) imposed by the country or any subdivision of the country in which
      Bank's principal office or actual lending office is located and (ii)
      measured by the United States taxable income Bank would have received if
      all payments under or in respect of this Guaranty were exempt from taxes
      levied by Guarantor's country) are at any time imposed on any payments
      under or in respect of this Guaranty including, but not limited to,
      payments made pursuant to this paragraph, Guarantor shall pay all such
      taxes to the relevant authority in accordance with applicable law such
      that Bank receives the sum it would have received had no such deduction or
      withholding been made (or, if Guarantor cannot legally comply with the
      foregoing, Guarantor shall pay to Bank such additional amounts as will
      result in Bank receiving the sum it would have received had no such
      deduction or withholding been made).  Further, Guarantor shall
      also pay to Bank, on demand, all additional amounts that Bank specifies as
      necessary to preserve the after-tax yield Bank would have received if such
      taxes had not been imposed.

              

      

      

      
        	
                 
      

              	
                (b)  Guarantor
      shall promptly provide Bank with an original receipt or certified copy
      issued by the relevant authority evidencing the payment of any such amount
      required to be deducted or
withheld.

              

      

      

      15.  Information Relating to
Borrower.  Guarantor acknowledges and agrees that it has made
such independent examination, review, and investigation of the Bank Agreements
as Guarantor deems necessary and appropriate, including, without limitation, any
covenants pertaining to Guarantor contained therein, and shall have sole
responsibility to obtain from Borrower any information required by Guarantor
about any modifications thereto. Guarantor further acknowledges and agrees
that it shall have the sole responsibility for, and has adequate means of,
obtaining from Borrower such information concerning Borrower's financial
condition or business operations as Guarantor may require, and that Bank has no
duty, and Guarantor is not relying on Bank, at any time to disclose to Guarantor
any information relating to the business operations or financial condition of
Borrower.

      

      
        
          
          

        

        
          4

          
            

          

        

        
          
          

        

      

      16.  Borrower's
Authorization.  Where Borrower is a corporation, partnership,
or limited liability company, it is not necessary for Bank to inquire into the
powers of Borrower or of the officers, directors, partners, members, managers,
or agents acting or purporting to act on its behalf, and any Indebtedness made
or created in reliance upon the professed exercise of such powers shall be
guaranteed hereunder, subject to any limitations on Guarantor's liability set
forth herein.

      

      17.  Guarantor Information;
Reporting to Credit Bureaus.  Guarantor authorizes Bank to
verify or check any information given by Guarantor to Bank, check Guarantor’s
credit references, verify employment, and obtain credit
reports.  Guarantor agrees that Bank shall have the right at all times
to disclose and report to credit reporting agencies and credit rating agencies
such information pertaining to the Indebtedness and/or Guarantor as is
consistent with Bank's policies and practices from time to time in
effect.  Guarantor acknowledges and agrees that the authorizations
provided in this paragraph apply to any individual general partner of Guarantor
and to Guarantor’s spouse and any such general partner’s spouse if Guarantor or
such general partner is married and lives in a community property
state.

      

      18.  Change of
Status.  Any Guarantor that is a business entity shall not
enter into any consolidation, merger, or other combination unless Guarantor is
the surviving business entity.  Further, Guarantor shall not change
its legal structure unless (a) Guarantor obtains the prior written consent of
Bank and (b) all Guarantor's obligations under this Guaranty are assumed by the
new business entity.

      

      19.  Remedies.  If
Guarantor fails to fulfill its duty to pay all Indebtedness guaranteed
hereunder, Bank shall have all of the remedies of a creditor and, to the extent
applicable, of a secured party, under all applicable law.  Without
limiting the foregoing
to the extent permitted by law, Bank may, at its option and without
notice or demand:

      

      (a)  declare any
Indebtedness due and payable at once;

      

      
        	
                 
      

              	
                (b)  take
      possession of any collateral pledged by Borrower or Guarantor, wherever
      located, and sell, resell, assign, transfer, and deliver all or any part
      of the collateral at any public or private sale or otherwise dispose of
      any or all of the collateral in its then condition, for cash or on credit
      or for future delivery, and in connection therewith Bank may impose
      reasonable conditions upon any such sale.  Further, Bank, unless
      prohibited by law the provisions of which cannot be waived, may purchase
      all or any part of the collateral to be sold, free from and discharged of
      all trusts, claims, rights of redemption and equities of Borrower or
      Guarantor whatsoever.  Guarantor acknowledges and agrees that
      the sale of any collateral through any nationally recognized
      broker-dealer, investment banker, or any other method common in the
      securities industry shall be deemed a commercially reasonable sale under
      the Uniform Commercial Code or any other equivalent statute or federal
      law, and expressly waives notice thereof except as provided herein;
      and

              

      

      

      
        	
                 
      

              	
                (c)  set
      off against any or all liabilities of Guarantor all money owed by Bank or
      any of its agents or affiliates in any capacity to Guarantor, whether or
      not due, and also set off against all other liabilities of Guarantor to
      Bank all money owed by Bank in any capacity to Guarantor.  If
      exercised by Bank, Bank shall be deemed to have exercised such right of
      setoff and to have made a charge against any such money immediately upon
      the occurrence of such default although made or entered on the books
      subsequent thereto.

              

      

      

      20.  Notices.  All
notices required under this Guaranty shall be personally delivered or sent by
first class mail, postage prepaid, or by overnight courier, to the addresses on
the signature page of this Guaranty, or sent by facsimile to the fax numbers
listed on the signature page, or to such other addresses as Bank and Guarantor
may specify from time to time in writing.  Notices sent by (a) first
class mail shall be deemed delivered on the earlier of actual receipt or on the
fourth business day after deposit in the U.S. mail, postage prepaid,
(b) overnight courier shall be deemed delivered on the next business day,
and (c) telecopy shall be deemed delivered when transmitted.

      

      
        
          
          

        

        
          5

          
            

          

        

        
          
          

        

      

      21.  Successors and
Assigns.  This Guaranty (a) binds Guarantor and Guarantor's
executors, administrators, successors, and assigns, provided that Guarantor may
not assign its rights or obligations under this Guaranty without the prior
written consent of Bank, and (b) inures to the benefit of Bank and Bank's
indorsees, successors, and assigns.  Bank may, without notice to
Guarantor and without affecting Guarantor's obligations hereunder, sell, assign,
grant participations in, or otherwise transfer to any other person, firm, or
corporation the Indebtedness and this Guaranty, in whole or in
part.  Guarantor agrees that Bank may disclose to any assignee or
purchaser, or any prospective assignee or purchaser, of all or part of the
Indebtedness any and all information in Bank's possession concerning Guarantor,
this Guaranty, and any security for this Guaranty.

      

      22.  Amendments, Waivers, and
Severability.  No provision of this Guaranty may be amended or
waived except in writing.  No failure by Bank to exercise, and no
delay in exercising, any of its rights, remedies, or powers shall operate as a
waiver thereof, and no single or partial exercise of any such right, remedy, or
power shall preclude any other or further exercise thereof or the exercise of
any other right, remedy, or power.  The unenforceability or invalidity
of any provision of this Guaranty shall not affect the enforceability or
validity of any other provision of this Guaranty.

      

      23.  Costs and
Expenses.  Guarantor agrees to pay all reasonable attorneys'
fees, including allocated costs of Bank's in-house counsel to the extent
permitted by applicable law, and all other costs and expenses that may be
incurred by Bank (a) in the enforcement of this Guaranty or (b) in the
preservation, protection, or enforcement of any rights of Bank in any case
commenced by or against Guarantor or Borrower under the Bankruptcy Code (Title
11, United States Code) or any similar or successor statute.

      

      24.  Governing Law and
Jurisdiction.  This Guaranty shall be governed by and construed
and enforced in accordance with the law of the State of Maryland.  To
the extent that Bank has greater rights or remedies under federal law, whether
as a national bank or otherwise, this paragraph shall not be deemed to deprive
Bank of such rights and remedies as may be available under federal
law.

      

      25.  Consent
to Jurisdiction.  TO INDUCE BANK TO ACCEPT THIS
GUARANTY, GUARANTOR IRREVOCABLY AGREES THAT, SUBJECT TO BANK’S SOLE AND ABSOLUTE
ELECTION, ALL ACTIONS OR PROCEEDINGS IN ANY WAY ARISING OUT OF OR RELATED TO
THIS GUARANTY WILL BE LITIGATED IN STATE OR FEDERAL COURTS HAVING SITUS IN
BALTIMORE, MARYLAND.  GUARANTOR HEREBY CONSENTS AND SUBMITS TO THE
JURISDICTION OF ANY STATE OR FEDERAL COURT LOCATED WITHIN BALTIMORE, MARYLAND
WAIVES PERSONAL SERVICE OF PROCESS UPON GUARANTOR, AND AGREES THAT ALL SUCH SERVICE OF
PROCESS MAY BE MADE BY REGISTERED MAIL DIRECTED TO GUARANTOR AT THE ADDRESS STATED ON THE
SIGNATURE PAGE HEREOF AND SERVICE SO MADE WILL BE DEEMED TO BE COMPLETED UPON
ACTUAL RECEIPT.

      

      26.  Waiver of Jury
Trial.  GUARANTOR AND BANK EACH WAIVES ANY RIGHT TO A TRIAL BY
JURY IN ANY ACTION OR PROCEEDING TO ENFORCE OR DEFEND ANY RIGHTS (A) UNDER THIS
GUARANTY OR ANY RELATED AGREEMENT OR UNDER ANY AMENDMENT, INSTRUMENT, DOCUMENT
OR AGREEMENT DELIVERED OR WHICH MAY IN THE FUTURE BE DELIVERED IN CONNECTION
WITH THIS GUARANTY OR (B) ARISING FROM ANY BANKING RELATIONSHIP EXISTING IN
CONNECTION WITH THIS GUARANTY, AND AGREES THAT ANY SUCH ACTION OR PROCEEDING
WILL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY.  THIS WAIVER IS
KNOWINGLY, WILLINGLY AND VOLUNTARILY MADE.  GUARANTOR AGREES THAT IT
WILL NOT ASSERT ANY CLAIM AGAINST BANK OR ANY OTHER PERSON INDEMNIFIED UNDER
THIS GUARANTY ON ANY THEORY OF LIABILITY FOR SPECIAL, INDIRECT, CONSEQUENTIAL,
INCIDENTAL OR PUNITIVE DAMAGES.

      

      
        
          
          

        

        
          6

          
            

          

        

        
          
          

        

      

      27.  CONFESSION OF
JUDGMENT.  GUARANTOR AUTHORIZES ANY ATTORNEY ADMITTED TO
PRACTICE BEFORE ANY COURT OF RECORD IN THE UNITED STATES OR ANY CLERK OF ANY
COURT OF RECORD TO APPEAR ON BEHALF OF GUARANTOR IN ANY COURT IN ONE OR MORE
PROCEEDINGS, OR BEFORE ANY CLERK THEREOF OR OTHER COURT OFFICIAL, AND TO CONFESS
JUDGMENT AGAINST GUARANTOR IN FAVOR OF THE HOLDER OF THIS GUARANTY IN THE FULL
AMOUNT DUE ON THIS GUARANTY (INCLUDING PRINCIPAL, ACCRUED INTEREST AND ANY AND
ALL CHARGES, FEES AND COSTS) PLUS ATTORNEYS' FEES EQUAL TO FIFTEEN PERCENT (15%)
OF THE TOTAL AMOUNT DUE, PLUS COURT COSTS, ALL WITHOUT PRIOR NOTICE OR
OPPORTUNITY OF GUARANTOR FOR PRIOR HEARING.  GUARANTOR AGREES AND
CONSENTS THAT VENUE AND JURISDICTION SHALL BE PROPER IN THE CIRCUIT COURT OF ANY
COUNTY OF THE STATE OF MARYLAND OR OF BALTIMORE CITY, MARYLAND, OR IN THE UNITED
STATES DISTRICT COURT FOR THE DISTRICT OF MARYLAND.  GUARANTOR WAIVES
THE BENEFIT OF ANY AND EVERY STATUTE, ORDINANCE, OR RULE OF COURT WHICH MAY BE
LAWFULLY WAIVED CONFERRING UPON GUARANTOR ANY RIGHT OR PRIVILEGE OF EXEMPTION,
HOMESTEAD RIGHTS, STAY OF EXECUTION, OR SUPPLEMENTARY PROCEEDINGS, OR OTHER
RELIEF FROM THE ENFORCEMENT OR IMMEDIATE ENFORCEMENT OF A JUDGMENT OR RELATED
PROCEEDINGS ON A JUDGMENT.  THE AUTHORITY AND POWER TO APPEAR FOR AND
ENTER JUDGMENT AGAINST GUARANTOR SHALL NOT BE EXHAUSTED BY ONE OR MORE EXERCISES
THEREOF, OR BY ANY IMPERFECT EXERCISE THEREOF, AND SHALL NOT BE EXTINGUISHED BY
ANY JUDGMENT ENTERED PURSUANT THERETO; SUCH AUTHORITY AND POWER MAY BE EXERCISED
ON ONE OR MORE OCCASIONS FROM TIME TO TIME, IN THE SAME OR DIFFERENT
JURISDICTIONS, AS OFTEN AS THE HOLDER SHALL DEEM NECESSARY, CONVENIENT, OR
PROPER.

      

      28.  FINAL
AGREEMENT.  BY SIGNING THIS DOCUMENT
EACH PARTY REPRESENTS AND AGREES THAT:  (A) THIS DOCUMENT REPRESENTS
THE FINAL AGREEMENT BETWEEN PARTIES WITH RESPECT TO THE SUBJECT MATTER HEREOF,
(B) THIS DOCUMENT SUPERSEDES ANY COMMITMENT LETTER, TERM SHEET, OR OTHER WRITTEN
OUTLINE OF TERMS AND CONDITIONS RELATING TO THE SUBJECT MATTER HEREOF, UNLESS
SUCH COMMITMENT LETTER, TERM SHEET, OR OTHER WRITTEN OUTLINE OF TERMS AND
CONDITIONS EXPRESSLY PROVIDES TO THE CONTRARY, (C) THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES, AND (D) THIS DOCUMENT MAY NOT BE CONTRADICTED BY
EVIDENCE OF ANY PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OR
UNDERSTANDINGS OF THE PARTIES.

      

      

      The parties executed this agreement as
of March 28, 2008, intending to create an instrument executed under
seal.

      

      

      GSE Process Solutions,
Inc.

      

      

      By:            
 /s Jeffery
Hough                                                      
(Seal)

         Jeffery
Hough

         Chief Financial
Officer

      

      

      Address
for notices to
Bank:                                                                                 Address
for notices to Guarantor:

      100 South
Charles Street, 2nd
Floor                                                                      7133
Rutherford Road, Suite 200

      Baltimore,
Maryland
21201                                                                                     Baltimore,
Maryland 21244

      Facsimile:_____________________                                                                  Facsimile:_____________________

      

      

      7

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