Document:

ex10_17busfinanceagreemt.htm

Exhibit 10.17

    BUSINESS
FINANCING AGREEMENT

     

    dated as
of September 3, 2008

     

    between

     

    BRIDGE
BANK, NATIONAL ASSOCIATION

     

    and

     

    ALPHA
INNOTECH CORP., a Delaware corporation ("Borrower")

     

    Borrower
and Lender agree as follows:

     

    1. Definitions and
Construction.

     

    1.1 Definitions.  In
this Agreement:

     

    "Account Balance"
means at any time the aggregate of the Receivable Amounts of all Domestic
Eligible Receivables at such time.

     

    "Account Debtor" has
the meaning in the California Uniform Commercial Code and includes any person
liable on any Receivable, including without limitation, any guaranty of any
Receivable and any issuer of a letter of credit or banker's acceptance assuring
payment thereof.

     

    "Adjustments" means
all discounts, allowances, disputes, offsets, defenses, rights of recoupment,
rights of return, warranty claims, or short payments, asserted by or on behalf
of any Account Debtor with respect to any Receivable.

     

    "Advance" means an
advance made by Lender to Borrower pursuant to Section 2.2.

     

    "Advance Rate" means
80% or such greater or lesser percentage as Lender may from time to time
establish in its sole discretion upon notice to Borrower.

     

    "Agreement" means this
Business Financing Agreement.

     

    “Borrower Agreement”
is the Export-Import Bank of the United States Working Capital Guarantee Program
Borrower Agreement between Borrower and Lender.

     

    "Borrowing Base" means
at any time the product of the Account Balance and the Advance
Rate.

     

    “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" means all
of Borrower's rights and interest in any and all personal property, whether now
existing or hereafter acquired or created and wherever located, and all products
and proceeds thereof and accessions thereto, including the following
(collectively, the "Collateral"):  accounts, including health care
insurance receivables, chattel paper, inventory, equipment, instruments,
including promissory notes, investment property, documents, deposit accounts,
letter of credit rights, any commercial tort claim of Borrower which is now or
hereafter identified by Borrower or Lender, general intangibles, and supporting
obligations.

     

    "Collections" means
all payments from or on behalf of an Account Debtor with respect to
Receivables.

     

    "Compliance
Certificate" means a certificate in the form attached to this Agreement
by the chief financial officer of Borrower that, among other things, the
representations and warranties set forth in this Agreement are true and correct
as of the date such certificate is delivered.

     

    “Credit Limit” means
$1,250,000, inclusive of the Inventory Sublimit.

     

    
      
        
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    "Default" means any
Event of Default or any event that with notice, lapse of time or otherwise would
constitute an Event of Default.

     

    “Domestic Advances”
means Advances made against Domestic Eligible Receivables.

     

    "Domestic Eligible
Receivable" means a Receivable that satisfies all of the
following:

     

    (a) The
Receivable has been created by Borrower in the ordinary course of Borrower's
business and without any obligation on the part of Borrower to render any
further performance.

     

    (b) There are
no conditions which must be satisfied before Borrower is entitled to receive
payment of the Receivable, and the Receivable does not arise from COD sales,
consignments or guaranteed sales.

     

    (c) The
Account Debtor upon the Receivable does not claim any defense to payment of the
Receivable, whether well founded or otherwise.

     

    (d) The
Receivable is not the obligation of an Account Debtor who has asserted or may
assert any counterclaims or offsets against Borrower (including offsets for any
"contra accounts" owed by Borrower to the Account Debtor for goods purchased by
Borrower or for services performed for Borrower).

     

    (e) The
Receivable represents a genuine obligation of the Account Debtor and to the
extent any credit balances exist in favor of the Account Debtor, such credit
balances shall be deducted in calculating the Receivable Amount.

     

    (f) Borrower
has sent an invoice to the Account Debtor in the amount of the
Receivable.

     

    (g) Borrower
is not prohibited by the laws of the state where the Account Debtor is located
from bringing an action in the courts of that state to enforce the Account
Debtor's obligation to pay the Receivable.  Borrower has taken all
appropriate actions to ensure access to the courts of the state where the
Account Debtor is located, including, where necessary, the filing of a Notice of
Business Activities Report or other similar filing with the applicable state
agency or the qualification by Borrower as a foreign corporation authorized to
transact business in such state.

     

    (h) The
Receivable is owned by Borrower free of any title defects or any liens or
interests of others except the security interest in favor of Lender and except
for Permitted Liens, and Lender has a perfected, first priority security
interest in such Receivable.

     

    (i) The
Account Debtor on the Receivable is not any of the following:  (i) an
employee, affiliate, parent or subsidiary of Borrower, or an entity which has
common officers or directors with Borrower; (ii) the U.S. government or any
agency or department of the U.S. government unless Lender agrees in writing to
accept the Receivable, Borrower complies with the procedures in the Federal
Assignment of Claims Act of 1940 (41 U.S.C. §15) with respect to the Receivable,
and the underlying contract expressly provides that neither the U.S. government
nor any agency or department thereof shall have the right of set-off against
Borrower; (iii) any person or entity located in a foreign country unless (A) the
Receivable is supported by an irrevocable letter of credit issued by a bank
acceptable to Lender, and (B) if requested by Lender, the original of such
letter of credit and/or any issuance drafts drawn under such letter of credit
and accepted by the issuing or confirming bank have been delivered to Lender;
(iv) an Account Debtor as to which thirty five percent (35%) or more of the
aggregate dollar amount of all outstanding Receivables owing from such Account
Debtor have not been paid within 90 days from invoice date; or (v) an Account
Debtor whose total obligations to Borrower exceed thirty five percent (35%) of
all Accounts, to the extent such obligations exceed the aforementioned
percentage, except as approved in writing by Bank.

     

    (j) The
Receivable is not in default (a Receivable will be considered in default if any
of the following occur: (i) the Receivable is not paid within 90 days from its
invoice date; (ii) the Account Debtor obligated upon the Receivable suspends
business, makes a general assignment for the benefit of creditors,
or

     

    
      
        
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    (k) fails to
pay its debts generally as they come due; or (iii) any petition is filed by or
against the Account Debtor obligated upon the Receivable under any bankruptcy
law or any other law or laws for the relief of debtors);

     

    (l) The
Receivable does not arise from the sale of goods which remain in Borrower's
possession or under Borrower's control.

     

    (m) The
Receivable is not evidenced by a promissory note or chattel paper, nor is the
Account Debtor obligated to Borrower under any other obligation which is
evidenced by a promissory note.

     

    (n) The
Receivable is otherwise acceptable to Lender.

     

    “EBITDASC” means
earnings before interest, taxes, depreciation, amortization and non-cash
stock-based charges, all determined in accordance with GAAP.

     

    “Eligible Inventory”
means raw materials and finished goods, net of perishable goods, consigned
inventory, obsolete goods and any other inventory that Lender deems ineligible
in its reasonable judgment due to more than normal inventory financing
risk.

     

    “Eligible Receivables”
means the Domestic Eligible Receivables and the EXIM Eligible Foreign
Accounts.

     

    “EXIM Account Balance”
means at any time the aggregate of the Receivable Amounts of all EXIM Eligible
Foreign Receivables at such time.

     

    “EXIM Advance Rate”
means 90% or such greater or lesser percentage as Lender may from time to time
establish in its sole discretion upon notice to Borrower.

     

    “EXIM Advances” means
Advances made against EXIM Eligible Foreign Accounts.

     

    “EXIM Bank” means
Export-Import Bank of the United States.

     

    “EXIM Bank Expenses”
are all reasonable fees that the Lender pays to the EXIM Bank in consideration
of the issuance of the EXIM Guarantee.

     

    "EXIM Borrowing Base"
means at any time the product of the EXIM Account Balance and the EXIM Advance
Rate.

     

    “EXIM Borrowing Base
Certificate/Funding Request” means the Borrowing Base Certificate/Funding
Request in form of Exhibit A hereto.

     

    “EXIM Credit Limit”
means $1,250,000, inclusive of the EXIM Inventory Sublimit.

     

    “EXIM Application Fee”
means a fee in the amount of $100 per annum.

     

    “EXIM Documents” means
the EXIM Guarantee, the Borrower Agreement, and each other agreement executed in
connection therewith.

     

    “EXIM Eligible Foreign
Accounts” are Receivables payable in United States Dollars that arise in
the ordinary course of Borrower's business and are derived from exports
originating in the United States (i) that the account debtor does not have its
principal place of business in the United States and (ii) that have been
assigned and comply with all of Borrower's representations and warranties in
Section 6; but
Lender may change eligibility standards by giving Borrower
notice.  Unless Lender agrees otherwise in writing, EXIM Eligible
Foreign Accounts will not include:

     

    
      
        
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    Receivables
with terms of sales greater than 120 days.

     

    (o) Receivables
of a Buyer for whom fifty percent (50%) or more of the Accounts Receivable of
such Buyer do not satisfy the requirements of subclause (a) above.

     

    (p) Receivables
which are more than sixty (60) calendar days past the original due date, unless
it is insured through EXIM Bank export credit insurance for comprehensive
commercial and political risk, or through EXIM Bank approved private insurers
for a comparable coverage, in which case ninety (90) calendar days shall
apply;

     

    (q) Credit
balances over 60 days from invoice due date;

     

    (r) Receivables
evidenced by a letter of credit until the date of shipment of the items covered
by the subject letter of credit;

     

    (s) Receivables
for which Borrower owes the account debtor, but only up to the amount owed
(sometimes called “contra” accounts, accounts payable, customer deposits or
credit accounts);

     

    (t) Receivables
for demonstration or promotional equipment, or in which goods are consigned,
sales guaranteed, sale or return, sale on approval, bill and hold, or other
terms if account debtor’s payment may be conditional;

     

    (u) Receivables
for which the account debtor is Borrower’s affiliate, officer, employee, or
agent;

     

    (v) Receivables
in which the account debtor disputes liability or makes any claim and Lender
believes there may be a basis for dispute (but only up to the disputed or
claimed amount), or if the Account Debtor is subject to a bankruptcy proceeding,
or becomes insolvent, or goes out of business;

     

    (w) Receivables
from sales of items associated with nuclear power, enrichment, reprocessing,
research or heavy water production facilities.

     

    (x) Receivable
from sales of Capital Goods.

     

    (y) Receivables
generated by the sale of products purchased for military purposes or which
constitute defense articles or defense services;

     

    (z) Receivables
that arise from the sales of items not in the ordinary course of Borrower’s
business;

     

    (aa) Receivables
not owned by Borrower or that are subject to any right, claim or interest of
another person other than the lien in favor of Lender;

     

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

     

    (cc) Receivables
billed or payable outside the United Stated unless approved in writing by EXIM
Bank, however, limited to no more than 50% of the borrowing base shall be of
such accounts; and such Receivables are subject to the following:

     

    (i) Each
subsidiary or affiliate is a party to the Agreement;

     

    (ii) All
proceeds are remitted to the United States on a monthly basis (excluding the
retention of proceeds for the purpose of funding local expenses);

     

    
      
        
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    (iii) Receivables
are derived from eligible exports originating from the United
States;

     

    (iv) All
payments due and payable are collected through a cash collateral account under
Lender’s control;

     

    (v) Receivables
are denominated in US Dollars or other hard currencies pre-approved by EXIM
Bank;

     

    (vi) Lender
obtains a valid first priority security interest (or equivalent) in the
jurisdiction where the Receivables are located; and

     

    (vii) Lender
obtains a legal opinion from local counsel with regard to the enforceability of
such security interest.

     

    (dd) Receivables
from account debtors with balance of 50% over 60 days past the invoice due
date;

     

    (ee) Receivables
with open account term with balance more than 35% concentration of total foreign
Receivables, unless pre-approved by Lender;

     

    (ff) Receivables
billed in currencies other than U.S. Dollars, unless approved in writing by EXIM
Bank;

     

    (gg) Receivables
from foreign buyers in countries where EXIM Bank is legally prohibited from
doing business or in which EXIM Bank coverage is not available (as designated in
the Country Limitation Schedule referred to the Borrower
Agreement);

     

    (hh) Foreign
Receivables backed by letters of credit unacceptable to Lender;

     

    (ii) Receivables
for which Lender or EXIM Bank determines collection to be
doubtful;

     

    (jj) Receivables
for which the items giving rise to such Receivable have not been shipped and
delivered to and accepted by the Buyer or the services giving rise to such
Receivables have not been performed by Borrower and accepted by the Buyer or the
Receivable does not represent a final sale;

     

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

     

    (ll) Receivables
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; and

     

    (mm) Receivables
for which any of the items giving rise to such Receivable have been returned,
rejected or repossessed.

     

    ”EXIM Eligible
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 EXIM Eligible 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 has
offsetting claims;

     

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

     

    (e) 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;

     

    (f) 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;

     

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

     

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

     

    (i) that is
demonstration Inventory or Inventory sold on consignment;

     

    (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 EXIM
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 EXIM 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 EXIM 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 EXIM Bank;

     

    (q) that
constitutes, or is to be incorporated into, Items whose sale would result in an
account receivable which would not be an Eligible 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.

     

    “EXIM Facility Fee”
means a fee equal to .50% of the EXIM Credit Limit, due upon execution of this
Agreement and annually thereafter.

     

    
      
        
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    “EXIM Guarantee” means
the Master Guaranty Agreement executed by EXIM Bank in favor of
Lender.

     

    “EXIM Inventory
Sublimit” means a sublimit for EXIM Eligible Inventory not to exceed (x)
the lesser of (a) $200,000 or (b) seventy five percent (75%) of Eligible
Inventory; and (y) sixty percent (60%) of the EXIM Advances
outstanding.

     

    "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
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.

    

    "Event of Default" has
the meaning set forth in Section 9.1.

     

    "Facility Fee" means a
fee equal to .50% of the Credit Limit, due upon execution of this Agreement and
annually thereafter.

     

    "Finance Charge" means
for each Reconciliation Period an interest amount equal to the Finance Charge
Percentage of the average daily outstanding balance of Advances during such
Reconciliation Period.

     

    "Finance Charge
Percentage" means a rate per year equal to one and one quarter percent
(1.25%) above the Prime Rate, plus an additional five percentage points (5.00%)
during any period that an Event of Default has occurred and is
continuing.

     

    "Funding Request"
means a writing signed by an authorized representative of Borrower requesting an
Advance which accurately identifies the Domestic Eligible Receivables and EXIM
Eligible Foreign Accounts and Receivable Amounts, and includes for each such
Receivable the correct amount owed by the Account Debtor, the name and address
of the Account Debtor, the invoice number, the invoice date and the account
code.

     

    “Inventory Sublimit”
means a sublimit for Eligible Inventory not to exceed (x) the lesser of (a)
$200,000 or (b) thirty percent (30%) of Eligible Inventory; and (y) thirty
percent (30%) of the Advances outstanding.

     

    "Lender" means Bridge
Bank, National Association, and its successors and assigns.

     

    “Material Adverse
Change” means a material adverse change in Borrower's (or any
guarantor's) business condition (financial or otherwise), operations, properties
or prospects, or ability to repay the credit.

     

    "Obligations" means
all liabilities and obligations of Borrower to Lender of any kind or nature,
present or future, arising under or in connection with this Agreement or under
any other document, instrument or agreement, whether or not evidenced by any
note, guarantee or other instrument, whether arising on account or by overdraft,
whether direct or indirect (including those acquired by assignment) absolute or
contingent, primary or secondary, due or to become due, now owing or hereafter
arising, and however acquired; including, without limitation, all Advances,
Finance Charges, fees, interest, expenses, professional fees and attorneys'
fees.

     

    
      
        
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    "Overadvance" means
that the total amount of the Advances or the EXIM Advances then outstanding
exceeds (x) the Credit Limit or the Borrowing Base, or (y) the EXIM Credit Limit
or the EXIM Borrowing Base, as applicable.

     

    “Permitted
Indebtedness” means: (a) Indebtedness of Borrower in favor of EXIM Bank
arising under this Agreement or any other Loan Document; (b) Indebtedness
existing on the Closing Date and disclosed to Lender and EXIM Bank; (c)
Indebtedness secured by a Permitted Lien not to exceed One Hundred Thousand
Dollars ($100,000) in the aggregate in any fiscal year of Borrower; (d)
Subordinated Debt; (e) Indebtedness to trade creditors and with respect to
surety bonds and similar obligations incurred in the ordinary course of
business; and (f) Extensions, refinancings, modifications, amendments,
restatements and renewals of any items of Permitted Indebtedness, provided that
the principal amount is not increased or the terms modified to impose more
burdensome terms upon Borrower or any Subsidiary, as the case may
be.

     

    “Permitted Liens”
means (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 EXIM Bank in writing, such Liens in Section 6.D. shall be subordinate to the
Liens in favor of Lender on Primary Collateral.

     

    "Prime Rate" means for
any day, a variable rate of interest, per annum, most recently published by the
Wall Street Journal, as the "prime rate," provided that if such day is not a
business day, the Prime Rate for such day shall be such rate on such
transactions on the next preceding business day as so published in the Wall
Street Journal on the next succeeding business day. The Prime Rate shall at no
event be less than 4.75%.

     

    "Receivable Amount"
means as to any Receivable, the Receivable Amount due from the Account Debtor
after deducting all discounts, credits, offsets, payments or other deductions of
any nature whatsoever, whether or not claimed by the Account
Debtor.

     

    "Receivables" means
Borrower's rights to payment arising in the ordinary course of Borrower's
business, including accounts, chattel paper, instruments, contract rights,
documents, general intangibles, letters of credit, drafts, and bankers
acceptances.

     

    "Reconciliation Date"
means the last calendar day of each Reconciliation Period.

     

    "Reconciliation
Period" means each calendar month.

     

    “Termination Date”
means the earlier of (a) one year from the date hereof, or (b) the date on which
Lender elects to terminate this Agreement pursuant to the terms
herein.

     

    1.2 Construction:

     

    (a) In this
Agreement:  (i) references to the plural include the singular and
to the singular include the plural; (ii) references to any gender include
any other gender; (iii) the terms "include" and "including" are not
limiting; (iv) the term "or" has the inclusive meaning represented by the
phrase "and/or," (v)

     

    
      
        
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    (b) unless
otherwise specified, section and subsection references are to this Agreement,
and (vi) any reference to any statute, law, or regulation shall include all
amendments thereto and revisions thereof.

     

    (c) Neither
this Agreement nor any uncertainty or ambiguity herein shall be construed or
resolved using any presumption against either Borrower or Lender, whether under
any rule of construction or otherwise.  On the contrary, this
Agreement has been reviewed by each party hereto and their respective
counsel.  In case of any ambiguity or uncertainty, this Agreement
shall be construed and interpreted according to the ordinary meaning of the
words used to accomplish fairly the purposes and intentions of all parties
hereto.

     

    (d) Titles
and section headings used in this Agreement are for convenience only and shall
not be used in interpreting this Agreement.

     

    2. Advances.

     

    2.1 Funding
Requests.  Borrower may request that Lender make an advance
(each, an "Advance") by delivering to Lender a Funding
Request.  Lender shall be entitled to rely on all the information
provided by Borrower to Lender on or with the Funding Request and to rely on the
signature on any Funding Request as an authorized signature of
Borrower.

     

    2.2 Revolving Credit
Line.  Subject to the terms and conditions of this Agreement,
from the date on which this Agreement becomes effective until the Termination
Date, Lender will make Advances to Borrower not exceeding the Credit Limit or
the Borrowing Base, whichever is less, minus, in each case, the Inventory
Sublimit; provided that in no event shall Lender be obligated to make any
Advance that results in an Overadvance or while any Overadvance is
outstanding.  Amounts borrowed under this Section may be repaid and
reborrowed during the term of this Agreement.  It shall be a condition
to each Advance that (a) all of the representations and warranties set
forth in Section 6 are true and correct on the date of such Advance as
though made at and as of each such date (except where such representations and
warranties relate to a specific prior date) and (b) no Default has occurred
and is continuing, or would result from such Advance.

     

    2.3 Inventory
Sublimit.  Subject to the terms and conditions of this
Agreement and the availability under the Credit Limit and the Borrowing Base,
Borrower may request Advances to purchase Eligible Inventory in an aggregate
amount not to exceed the Inventory Sublimit.

     

    2.4 EXIM
Advances.  Subject to the terms and conditions of this
Agreement, from the date on which this Agreement becomes effective until the
Termination Date, Lender will make EXIM Advances to Borrower not exceeding the
EXIM Credit Limit or the EXIM Borrowing Base, whichever is less, minus, in each
case, the EXIM Inventory Sublimit; provided that in no event shall Lender be
obligated to make any EXIM Advance that results in an Overadvance or while any
Overadvance is outstanding.  Amounts borrowed under this Section may
be repaid and reborrowed during the term of this Agreement.  It shall
be a condition to each EXIM Advance that (a) all of the representations and
warranties set forth in Section 6 are true and correct on the date of such
EXIM Advance as though made at and as of each such date (except where such
representations and warranties relate to a specific prior date) and (b) no
Default has occurred and is continuing, or would result from such EXIM
Advance.

     

    2.5 EXIM Inventory
Sublimit.  Subject to the terms and conditions of this
Agreement and the availability under the EXIM Credit Limit and the EXIM
Borrowing Base, Borrower may request EXIM Advances to purchase Eligible
Inventory in an aggregate amount not to exceed the EXIM Inventory
Sublimit.

     

    2.6 Rights in Respect
of  Receivables.  Lender shall have the exclusive
right to receive all Collections on the Receivable and no Adjustments will be
made without the Lender's consent.  Lender shall have, with respect to
any goods related to the Receivables, all the rights and remedies of an unpaid
seller under the California Uniform Commercial Code and other applicable law,
including the rights of replevin, claim and delivery, reclamation and stoppage
in transit.

     

    
      
        
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    2.7 Due
Diligence.  Lender may at any time and from time to time
contact Account Debtors and other persons obligated or knowledgeable in respect
of Receivables to confirm the Receivable Amount of such Receivables, to
determine whether Receivables constitute Eligible Receivables, and for any other
purpose in connection with this Agreement.  Lender may audit
Borrower’s Receivables and any and all records pertaining to the Collateral, at
Lender’s sole discretion and at Borrower's expense; provided that such audits
shall be conducted not more often than twice a year, unless an Event of Default
has occurred.

     

    3. Collections, Charges and
Remittances.

     

    3.1 Collections.  Lender
shall credit Collections with respect to Receivables received by Lender to
Borrower's Account Balance within three business days of the date
received.  At Lender's discretion, all Collections received by Lender
may either be (a) credited to Borrower's deposit account with Lender, or (b)
applied to repay when due the Advances, the EXIM Advances and other Obligations;
once all Obligations have been paid in full, Lender agrees promptly to remit to
Borrower the remaining amount of Collections it receives.  Lender has
no duty to do any act other than to turn over such amounts as required
above.  If an item of Collections is not honored or Lender does not
receive good funds for any reason (except as a result of Lender’s gross
negligence), the amount of any application shall be reversed as if the
Collections had not been received and Finance Charges under Section 3.2
shall accrue thereon.

     

    3.2 Finance
Charges.  Ten days following the Reconciliation Date Borrower
shall pay to Lender the Finance Charge for the prior Reconciliation
Period.  Lender may deduct the accrued Finance Charges from Borrowers
checking account maintained with Lender.

     

    3.3 Fees.

     

    (a) Facility
Fee.  On the date of this Agreement and on each anniversary
thereof prior to the Termination Date, Borrower shall pay to Lender the Facility
Fee.

     

    (b) EXIM Facility Fee; EXIM
Application Fee.  On the date of this Agreement and each
anniversary thereof, Borrower shall pay to Lender the EXIM Facility Fee and the
EXIM Application Fee.

     

    3.4 Reporting.  Within
15 days after the end of each Reconciliation Period, Lender shall send to
Borrower a report covering the transactions for that Reconciliation Period,
including the amount of all Collections, Adjustments made by Lender, Finance
Charges, and other fees and charges.  The accounting shall be deemed
correct and conclusive unless Borrower makes written objection to Lender within
30 days after the Lender mails the accounting to Borrower.

     

    3.5 Adjustments.  In
the event of a breach of Sections 6 or 7, or in the event any Adjustment or
dispute is asserted by any Account Debtor, Borrower shall promptly advise Lender
and shall, subject to the Lender's approval, resolve such disputes and advise
Lender of any adjustments.  Lender shall have the right, at any time,
to take possession of any rejected, returned, or recovered personal
property.  If such possession is not taken by Lender, Borrower is to
resell it for Lender's account at Borrower's expense with the proceeds made
payable to Lender.  While Borrower retains possession of any returned
goods, Borrower shall segregate said goods and mark them as property of
Lender.

     

    3.6 Lockbox Account Collection
Services.  Borrower and Lender shall immediately enter into a
remittance processing services agreement acceptable to Lender (the “Lockbox
Agreement”).  Borrower shall use the lockbox address as the remit to
and payment address for all of Borrower’s Collections and it will be considered
an immediate Event of Default if this does not occur or is not operational
within 45 days of the date of this Agreement.  All Collections
received to the lockbox will be deposited to a non-interest bearing bank-control
account maintained with Lender and Borrower will not have access to that
account.  Borrower will (i) immediately notify, transfer and deliver
to Lender all Collections Borrower receives and (ii) deliver to Lender a
detailed cash receipt’s journal on Friday of each week until the lockbox is
operational.  Additionally, Lender may request that Account Debtor’s
pay (by wire transfer or otherwise) Collections to Lender directly.

     

    
      
        
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    3.7 Overadvances.

     

    3.8 Overadvances.  Upon
any occurrence of an Overadvance, Borrower shall immediately pay down the
Advances or the EXIM Advances, as applicable, so that, after giving effect to
such payments, no Overadvance exists.

     

    3.9 Borrower's
Payment.  When any Overadvance or other amount owing to Lender
becomes due, Lender shall inform Borrower of the manner of payment which may be
any one or more of the following in Lender's sole
discretion:  (a) in cash immediately upon demand therefor; (b) by
deduction from or offset against the amount that otherwise would be forwarded to
Borrower in respect of any further Advances that may be made by Lender; or
(c) by any combination of the foregoing as Lender may from time to time
choose.

     

    4. Power of
Attorney.  Borrower irrevocably appoints Lender and its
successors and assigns as Borrower's true and lawful attorney in fact, and
authorizes Lender, at Borrower's sole expense, whether or not there has been an
Event of Default, to (i) receive and open all mail addressed to Borrower
for the purpose of collecting the Receivables; (ii) endorse Borrower's name
on any checks or other forms of payment on the Receivables; (iii) execute
on behalf of Borrower any and all instruments, documents, financing statements
and the like to perfect Lender's interests in the Receivables and Collateral;
(iv) to notify all Account Debtors with respect to the Receivables to pay Lender
directly; (v) debit Borrower’s checking account maintained with Lender for any
and all Obligations due under this Agreement; (vi)  sell, assign, transfer,
pledge, compromise, or discharge the whole or any part of the Collateral;
(vii) demand, collect, receive, sue, and give releases to any Account
Debtor for the monies due or which may become due upon or with respect to the
Receivables and to compromise, prosecute, or defend any action, claim, case or
proceeding relating to the Collateral, including the filing of a claim or the
voting of such claims in any bankruptcy case, all in Lender's name or Borrower's
name, as Lender may choose; and (viii) prepare, file and sign Borrower's
name on any notice, claim, assignment, demand, draft, or notice of or
satisfaction of lien or mechanics' lien or similar document with respect to the
Collateral; and (ix) do all acts and things necessary or expedient, in
furtherance of any such purposes.

     

    5. Representations and
Warranties. Borrower represents and
warrants:

     

    (a) With
respect to each Eligible Receivable:

     

    (i) It is the
owner with legal right to sell, transfer and assign it;

     

    (ii) The
correct Receivable Amount has been accurately reported to Lender and is not
disputed;

     

    (iii) Lender
has the right to endorse and/ or require Borrower to endorse all payments
received on Receivables and all proceeds of Collateral; and

     

    (iv) No
representation, warranty or other statement of Borrower in any certificate or
written statement given to Lender contains any untrue statement of a material
fact or omits to state a material fact necessary to make the statement contained
in the certificates or statement not misleading.

     

    (b) Borrower
is duly existing and in good standing in its state of formation and qualified
and licensed to do business in, and in good standing in, any state in which the
conduct of its business or its ownership of property requires that it be
qualified, except where the failure to do so could not reasonably be expected to
cause a Material Adverse Change.

     

    (c) The
execution, delivery and performance of this Agreement has been duly authorized,
and does not conflict with Borrower's organizational documents, nor constitute
an Event of Default under any material agreement by which Borrower is
bound.  Borrower is not in default under any agreement to which or by
which it is bound, except to the extent such default could not reasonably be
expected to cause a Material Adverse Change.

     

    
      
        
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    (d) Borrower
has good title to the Collateral, except for Permitted Liens, and all inventory
is in all material respects of good and marketable quality, free from material
defects, except for inventory for which adequate reserves have been made
(provided no such inventory is included in any Borrowing Base
Certificate).

     

    (e) Borrower's
name, form of organization, chief executive office, and the place where the
records concerning all Receivables and Collateral are kept is set forth at the
beginning of this Agreement, Borrower is located at its address for notices set
forth in this Agreement.

     

    (f) If
Borrower owns, holds or has any interest in, any copyrights (whether registered,
or unregistered), patents or trademarks, and licenses of any of the foregoing,
such interest has been specifically disclosed and identified to Lender in
writing.

     

    6. Miscellaneous
Provisions.  Borrower will:

     

    (a) Maintain
its corporate existence and good standing in its jurisdictions of incorporation
and maintain its qualification in each jurisdiction necessary to Borrower’s
business or operations, except where the failure to do so could not reasonably
be expected to cause a Material Adverse Change.

     

    (b) Give
Lender at least 30 days prior written notice of changes to its name,
organization, chief executive office or location of records.

     

    (c) Pay or
make provisions for paying all its taxes including gross payroll, withholding
and sales taxes when due and will deliver satisfactory evidence of payment to
Lender if requested. 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.

     

    (d) Provide
to Lender a written report within 10 days, if payment of any Receivable does not
occur by its due date and include the reasons for the delay.

     

    (e) Give
Lender copies of all of Borrower's quarterly balance sheets and income
statements, Forms 10-K, 10-Q and 8-K (or equivalents) within 5 days of filing
any of the foregoing with the Securities and Exchange Commission, while any
Advance is outstanding; provided that such Forms shall be deemed to have been
delivered on the date on which Borrower posts the same or provides a link
thereto on Borrower’s or another website on the Internet.

     

    (f) Execute
any further instruments and take further action as Lender reasonably requests to
perfect or continue Lender’s security interest in the Collateral or to effect
the purposes of this Agreement.

     

    (g) Immediately
notify, transfer and deliver to Lender all Collections Borrower
receives.

     

    (h) Not
create, incur, assume, or be liable for any indebtedness, except for Permitted
Indebtedness.

     

    (i) Immediately
notify Lender if Borrower hereafter obtains any interest in any copyrights,
patents, trademarks or licenses that are significant in value or are material to
the conduct of its business or the value of any Receivable.

     

    (j) Provide
to Lender within 30 days after the end of each month the following for such
month and the period then ending: balance sheet, income statement; statement of
cashflows, deferred revenue report, and Compliance Certificate.

     

    
      
        
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    (k) Provide
to Lender, no later than 5 days following the 1st and
15th
day of each month, the following for the period then ending: accounts receivable
aging report, together with a borrowing base certificate in form and substance
acceptable to Lender setting forth the Eligible Receivables and Receivable
Amounts thereof, and an accounts payable aging report.

     

    (l) Provide
to Lender, no later than 30 days after to the end of Borrower’s fiscal year,
Borrower’s Board of Director’s-approved operating budget for the succeeding
year;

     

    (m) Provide
to Lender, as soon as available, but in any event within 120 days after the end
of Borrower’s fiscal year, audited consolidated financial statements of Borrower
prepared in accordance with GAAP, consistently applied, together with an
unqualified opinion on such financial statements of an independent certified
public accounting firm reasonably acceptable to Lender.

     

    (n) At
reasonable request and during normal business hours, Lender shall have a right
from time to time hereafter to audit Borrower's Inventory and Receivables at
Borrower's expense.  Such audits shall be conducted every
six months or, if an Event of Default has occurred, more
frequently.

     

    (o) Maintain
its primary depository and operating accounts with Lender and, in the case of any deposit accounts not maintained
with Lender, grant to Lender a first priority perfected security interest in and
“control” (within the meaning of Section 9104 of the California Uniform
Commercial Code) of such deposit account pursuant to documentation acceptable
to Lender.

     

    (p) At all
times insure all of the tangible Collateral and carry such other business
insurance, with insurers reasonably acceptable to Lender, in such form and
amounts as Lender may reasonably require and that are customary and in
accordance with standard practices for Borrower’s industry and locations, and
Borrower shall provide evidence of such insurance to Lender.  All such
insurance policies shall name Lender as an additional loss payee, and shall
contain a lenders loss payee endorsement in form reasonably acceptable to
Lender.  Upon receipt of the proceeds of any such insurance, Lender
shall apply such proceeds in reduction of the Obligations as Lender shall
determine in its good faith business judgment, provided that no Default or Event
of Default has occurred and is continuing.  If Borrower fails to
provide or pay for any insurance, Lender may, but is not obligated to, obtain
the same at Borrower's expense.  Borrower shall promptly deliver to
Lender copies of all material reports made to insurance companies.

     

    (q) Not merge
or consolidate with or into any other business organization, or acquire all or
substantially all of the capital stock or property of a third party, unless (i)
any such acquired entity becomes a “borrower” under this Agreement and (ii)
Lender has previously consented to the applicable transaction in
writing.

     

    (r) Maintain
on a rolling 3-month basis an EBITDASC of no less than One Dollar
($1.00).

     

    (s) Provide
to Lender promptly upon the execution hereof, a subordination agreement by
Agility Capital and Montage Capital in favor of Lender, in each case, in form
satisfactory to Lender.

     

    7. Security
Interest.  To secure the prompt payment and performance to
Lender of all of the Obligations, Borrower hereby grants to Lender a continuing
security interest in the Collateral.  Borrower is not authorized to
sell, assign, transfer or otherwise convey any Collateral without Lender's prior
written consent, except for the sale of finished inventory in the Borrower's
usual course of business.  Borrower agrees to sign any instruments and
documents requested by Lender to evidence, perfect, or protect the interests of
Lender in the Collateral.  Borrower agrees to deliver to Lender the
originals of all instruments, chattel paper and documents evidencing or related
to Receivables and other Collateral.  Borrower shall not grant or
permit any lien or security interest in the Collateral or any interest therein,
except for Permitted Liens.

     

    8. Default and
Remedies.

     

    8.1 Events of
Default.  The occurrence of any one or more of the following
shall constitute an Event of Default hereunder.

     

    
      
        
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    8.2 Failure to
Pay.  Borrower fails to make a payment under this
Agreement.

     

    (a) Lien
Priority.  Lender fails to have an enforceable first lien
(except for any prior liens or Permitted Liens to which Lender has consented in
writing) on or security interest in the Collateral.

     

    (b) False
Information.  Borrower (or any guarantor) has given Lender
false or misleading information or representations.

     

    (c) Intentionally
Omitted.

     

    (d) Bankruptcy.  Borrower
(or any guarantor) files a bankruptcy petition, a bankruptcy petition is filed
against Borrower (or any guarantor) or Borrower (or any guarantor) makes a
general assignment for the benefit of creditors; provided such proceeding is not
stayed or dismissed within 45 days of initiation thereof.

     

    (e) Receivers.  A
receiver or similar official is appointed for a substantial portion of
Borrower's (or any guarantor's) business, or the business is
terminated.

     

    (f) Judgments.  Any
judgments or arbitration awards in excess of $250,000 (individually or in the
aggregate) are entered against Borrower (or any guarantor), or Borrower (or any
guarantor) enters into any settlement agreements with respect to any litigation
or arbitration which could reasonably be expected to result in damages
(individually or in the aggregate) in excess of $250,000.

     

    (g) Material Adverse
Change.  A Material Adverse Change occurs, or is reasonably
likely to occur; or Lender determines that it is insecure for any other
reason.

     

    (h) Cross-default.  Any
default occurs under any agreement in connection with any credit Borrower (or
any guarantor) or any of Borrower's related entities or affiliates has obtained
from anyone else or which Borrower (or any guarantor) or any of Borrower's
related entities or affiliates has guaranteed.

     

    (i) Default under Related
Documents.  Any default occurs under any guaranty,
subordination agreement, security agreement, deed of trust, mortgage, or other
document required by or delivered in connection with this Agreement or (while
any of the Loan Agreements remain in effect) any such document is no longer in
effect.

     

    (j) Other
Agreements.  Borrower (or any guarantor) or any of Borrower's
related entities or affiliates fails to meet the conditions of, or fails to
perform any obligation under any other agreement Borrower (or any guarantor) or
any of Borrower's related entities or affiliates has with Lender or any
affiliate of Lender.

     

    (k) Change of
Control.  Absent the prior
written consent of Lender, the holders of the capital ownership of the Borrower
as of the date hereof cease to own and control, directly and indirectly, at
least 90% of the capital ownership of the Borrower.

     

    (l) Other Breach Under
Agreement.  Borrower fails to meet the conditions of, or fails
to perform any obligation under, any material term of this Agreement not
specifically referred to above.

     

    8.3 Remedies.  Upon
the occurrence of an Event of Default, (1) without implying any obligation
to do so, Lender may cease making Advances and/or EXIM Advances, or extending
any other financial accommodations to Borrower; (2) all or a portion of the
Obligations shall be, at the option of and upon demand by Lender, or with
respect to an Event of Default described in Section 9.1(e), automatically
and without notice or demand, due and payable in full; (3) Lender may notify
Account Debtors that the underlying Receivables have been assigned to Lender and
that payment thereof is to be made to the order of Lender and sent directly to
Lender, and (4) Lender shall have and may exercise all the rights and
remedies under this Agreement and under applicable law, including the rights and
remedies of a secured party under the California Uniform Commercial Code, all
the power of attorney rights described in Section 5 with respect to all
Collateral, and the

     

    
      
        
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    8.4 right to
collect, dispose of, sell, lease, use, and realize upon all Receivables and all
Collateral in any commercial reasonable manner.

     

    9. Accrual of
Interest.  If any amount owed by Borrower hereunder is not paid
when due, including, without limitation, amounts due under Section 3.3,
Overadvances, amounts due under Section 11, and any other Obligations, such
amounts shall bear interest at a per annum rate equal to the per annum rate of
the Finance Charges until the earlier of (i) payment in good funds or
(ii) entry of a final judgment thereof, at which time the principal amount
of any money judgment remaining unsatisfied shall accrue interest at the highest
rate allowed by applicable law.  All interest and Finance Charges
hereunder calculated at an annual rate shall be based on a year of 360 days,
which results in a higher effective rate of interest than if a year of 365 or
366 days were used.

     

    10. Fees, Costs and Expenses;
Indemnification.  The Borrower will pay to Lender upon demand
all fees, costs and expenses (including fees of attorneys and professionals and
their costs and expenses) that Lender incurs or may from time to time impose in
connection with any of the following: (a) preparing, negotiating,
administering, and enforcing this Agreement or any other agreement executed in
connection herewith, including any amendments, waivers or consents in connection
with any of the foregoing, (b) any litigation or dispute (whether
instituted by Lender, Borrower or any other person) in any way relating to the
Receivables, the Collateral, this Agreement or any other agreement executed in
connection herewith or therewith, (c) enforcing any rights against Borrower
or any guarantor, or any Account Debtor, (d) protecting or enforcing its
interest in the Receivables or the Collateral, (e) collecting the
Receivables and the Obligations, or (f) the representation of Lender in
connection with any bankruptcy case or insolvency proceeding involving Borrower,
any Receivable, the Collateral, any Account Debtor, or any
guarantor.  Borrower shall indemnify and hold Lender harmless from and
against any and all claims, actions, damages, costs, expenses, and liabilities
of any nature whatsoever arising in connection with any of the foregoing, except
with respect to any losses caused by Lender’s gross negligence or willful
misconduct.

     

    11. Integration, Severability,
Waiver, and Choice of Law.  This Agreement and any related
security or other agreements required by this Agreement, collectively: (a)
represent the sum of the understandings and agreements between Lender and
Borrower concerning this credit; (b) replace any prior oral or written
agreements between Lender and Borrower concerning this credit; and (c) are
intended by Lender and Borrower as the final, complete and exclusive statement
of the terms agreed to by them.  In the event of any conflict between
this Agreement and any other agreements required by this Agreement, this
Agreement will prevail.  If any provision of this Agreement is deemed
invalid by reason of law, this Agreement will be construed as not containing
such provision and the remainder of the Agreement shall remain in full force and
effect.  Lender retains all of its rights, even if it makes an Advance
after a default.  If Lender waives a default, it may enforce a later
default.  Any consent or waiver under, or amendment of, this Agreement
must be in writing, and no such consent, waiver, or amendment shall imply any
obligation by Lender to make any subsequent consent, waiver, or
amendment.   THIS AGREEMENT SHALL BE GOVERNED BY AND INTERPRETED
IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF CALIFORNIA.

     

    12. Notices.  All
notices shall be given to Lender and Borrower at the addresses or faxes set
forth on the signature page of this Agreement and shall be deemed to have been
delivered and received: (a) if mailed, three (3) calendar days after
deposited in the United States mail, first class, postage pre-paid, (b) one
(1) calendar day after deposit with an overnight mail or messenger service; or
(c) on the same date of confirmed transmission if sent by hand delivery,
telecopy, telefax or telex.

     

    13. Jury
Trial.  EACH PARTY TO THIS AGREEMENT HEREBY EXPRESSLY WAIVES
ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION
ARISING IN CONNECTION WITH THE OBLIGATIONS OR IN ANY WAY CONNECTED WITH OR
RELATED OR INCIDENTAL TO THE DEALINGS OF THE PARTIES HERETO OR ANY OF THEM WITH
RESPECT TO ANY OBLIGATION, OR THE TRANSACTIONS RELATED THERETO, IN EACH CASE
WHETHER NOW EXISTING OR HEREAFTER ARISING, AND WHETHER FOUNDED IN CONTRACT OR
TORT OR OTHERWISE; AND EACH PARTY HEREBY AGREES AND CONSENTS THAT ANY SUCH
CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT
A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR
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    14. ANY COURT
AS WRITTEN EVIDENCE OF THE CONSENT OF THE SIGNATORIES HERETO TO THE WAIVER OF
THEIR RIGHT TO TRIAL BY JURY.  EACH PARTY REPRESENTS AND WARRANTS THAT
IT HAS REVIEWED THIS WAIVER, HAS DETERMINED FOR ITSELF THE NECESSITY TO REVIEW
THE SAME WITH ITS LEGAL COUNSEL, AND KNOWINGLY AND VOLUNTARILY WAIVES ALL RIGHTS
TO A JURY TRIAL.

     

    15. REFERENCE
PROVISION.

     

    (a) The
parties prefer that any dispute between them be resolved in litigation subject
to a Jury Trial Waiver as set forth in the Loan Documents (defined below), but
the California Supreme Court has held that pre-dispute Jury Trial Waivers not
authorized by statute are unenforceable. This Reference Provision will be
applicable until: (i) the California Supreme Court holds that a pre-dispute Jury
Trial Waiver provision similar to that contained in the Loan Documents is valid
or enforceable; or (ii) the California Legislature enacts a statute which
becomes law, authorizing pre-dispute Jury Trial Waivers of the type in the Loan
Documents and, as a result, such waivers become enforceable.  In
addition, this Reference Provision, if not already applicable as otherwise
provided herein, will become applicable, if a Court, contrary to a choice of law
provision contained in the Loan Documents, holds that the laws of the State of
California apply to the Loan Documents.

     

    (b) Other
than (i) nonjudicial foreclosure of security interests in real or personal
property,  (ii) the appointment of a receiver or (iii) the exercise of
other provisional remedies (any of which may be initiated pursuant to applicable
law), any controversy, dispute or claim (each, a “Claim”) between the parties
arising out of or relating to this Agreement or any other document, instrument
or agreement between Lender and the undersigned (collectively in this Section,
the “Loan Documents”), will be resolved by a reference proceeding in California
in accordance with the provisions of Section 638 et seq. of the California Code
of Civil Procedure (“CCP”), or their successor sections, which shall constitute
the exclusive remedy for the resolution of any Claim, including whether the
Claim is subject to the reference proceeding.  Except as otherwise
provided in the Loan Documents, venue for the reference proceeding will be in
the Superior Court or Federal District Court in the County or District where the
real property, if any, is located or in a County or District where venue is
otherwise appropriate under applicable law (the “Court”).

     

    (c) The
referee shall be a retired Judge or Justice selected by mutual written agreement
of the parties.  If the parties do not agree, the referee shall be
selected by the Presiding Judge of the Court (or his or her
representative).  A request for appointment of a referee may be heard
on an ex parte or expedited basis, and the parties agree that irreparable harm
would result if ex parte relief is not granted.  The referee shall be
appointed to sit with all the powers provided by law.  Pending
appointment of the referee, the Court has power to issue temporary or
provisional remedies.

     

    (d) The
parties agree that time is of the essence in conducting the reference
proceedings.  Accordingly, the referee shall be requested, subject to
change in the time periods specified herein for good cause shown, to (a) set the
matter for a status and trial-setting conference within fifteen (15) days after
the date of selection of the referee, (b) if practicable, try all issues of law
or fact within ninety (90) days after the date of the conference and (c) report
a statement of decision within twenty (20) days after the matter has been
submitted for decision.

     

    (e) The
referee will have power to expand or limit the amount and duration of
discovery.  The referee may set or extend discovery deadlines or
cutoffs for good cause, including a party’s failure to provide requested
discovery for any reason whatsoever.  Unless otherwise ordered based
upon good cause shown, no party shall be entitled to “priority” in conducting
discovery, depositions may be taken by either party upon seven (7) days written
notice, and all other discovery shall be responded to within fifteen (15) days
after service.  All disputes relating to discovery which cannot be
resolved by the parties shall be submitted to the referee whose decision shall
be final and binding.

     

    (f) Except as
expressly set forth in this Agreement, the referee shall determine the manner in
which the reference proceeding is conducted including the time and place of
hearings, the order of presentation of evidence, and all other questions that
arise with respect to the course of the reference

     

    
      
        
          WEST\21453667.4

          355157-000030
                                                                    

        

         

      

      
         

        
          

        

      

      
         

      

    

    (g) proceeding.  All
proceedings and hearings conducted before the referee, except for trial, shall
be conducted without a court reporter, except that when any party so requests, a
court reporter will be used at any hearing conducted before the referee, and the
referee will be provided a courtesy copy of the transcript.  The party
making such a request shall have the obligation to arrange for and pay the court
reporter.  Subject to the referee’s power to award costs to the
prevailing party, the parties will equally share the cost of the referee and the
court reporter at trial.

     

    (h) The
referee shall be required to determine all issues in accordance with existing
case law and the statutory laws of the State of California.  The rules
of evidence applicable to proceedings at law in the State of California will be
applicable to the reference proceeding.  The referee shall be
empowered to enter equitable as well as legal relief, provide all temporary or
provisional remedies, enter equitable orders that will be binding on the parties
and rule on any motion which would be authorized in a trial, including without
limitation motions for summary judgment or summary adjudication.  The
referee shall issue a decision and pursuant to CCP §644 the referee’s decision
shall be entered by the Court as a judgment or an order in the same manner as if
the action had been tried by the Court.  The final judgment or order
or from any appealable decision or order entered by the referee shall be fully
appealable as provided by law.  The parties reserve the right to
findings of fact, conclusions of laws, a written statement of decision, and the
right to move for a new trial or a different judgment, which new trial, if
granted, is also to be a reference proceeding under this provision.

     

    (i) If the
enabling legislation which provides for appointment of a referee is repealed
(and no successor statute is enacted), any dispute between the parties that
would otherwise be determined by reference procedure will be resolved and
determined by arbitration.  The arbitration will be conducted by a
retired judge or Justice, in accordance with the California Arbitration Act
§1280 through §1294.2 of the CCP as amended from time to time.  The
limitations with respect to discovery set forth above shall apply to any such
arbitration proceeding.

     

    (j) THE
PARTIES RECOGNIZE AND AGREE THAT ALL DISPUTES RESOLVED UNDER THIS REFERENCE
PROVISION WILL BE DECIDED BY A REFEREE AND NOT BY A JURY.  AFTER
CONSULTING (OR HAVING HAD THE OPPORTUNITY TO CONSULT) WITH COUNSEL OF THEIR OWN
CHOICE, EACH PARTY KNOWINGLY AND VOLUNTARILY AND FOR THEIR MUTUAL BENEFIT AGREES
THAT THIS REFERENCE PROVISION WILL APPLY TO ANY DISPUTE BETWEEN THEM WHICH
ARISES OUT OF OR IS RELATED TO THIS AGREEMENT OR THE LOAN
DOCUMENTS.

     

    16. Term and
Termination.  This Agreement shall become effective upon the
execution and delivery hereof by Borrower and Lender and shall continue in full
force and effect until the Termination Date. Upon the Termination Date, the
unpaid balance of the Obligations shall be due and payable without demand or
notice. Notwithstanding any of the foregoing, the obligations of Borrower to
indemnify Lender with respect to the expenses, damages, losses, costs and
liabilities described in Section 11 shall survive until all applicable statute
of limitations periods with respect to actions that may be brought against
Lender have run.

     

    17. Other
Agreements.  (i) Any security agreements, liens and/or security
interests securing payment of any obligations of Borrower owing to Lender or its
affiliates also secure the Obligations, and are valid and subsisting and are not
adversely affected by execution of this Agreement.  An Event of
Default under this Agreement constitutes a default under other outstanding
agreements between Borrower and Lender or its affiliates; (ii) Lender reserves
the right to issue press releases, advertisements, and other promotional
materials describing any successful outcome of services provided on Borrower’s
behalf.  Borrower agrees that Lender shall have the right to identify
Borrower by name in those materials.

     

    

     

    

     

    [Balance of Page Intentionally Left
Blank]

     

    

     

    
      
        
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          355157-000030
                                                                    

        

         

      

      
         

        
          

        

      

      
         

      

    

    IN
WITNESS WHEREOF, Borrower and Lender have executed this Agreement on the day and
year above written.

     

    
      	
              BORROWER:

            	
              LENDER:

            
	
              ALPHA
      INNOTECH CORP., a Delaware corporation

              By                                                      

              Name:                                                                

              Title:                                                      

            	
              BRIDGE
      BANK, NATIONAL ASSOCIATION

               

               

              By                                                      

               

              Name:                                                                

               

              Title:                                                      

               

            
	
              Address for Notices:

              Attn:  Chief
      Financial Officer

              2401
      Merced Street

              San
      Leandro, CA  94577

              Fax:
      (510) 483-3227

            	
              Address for Notices:

              Attn:  Lee
      Shodiss

              55
      Almaden Blvd

              San
      Jose, CA 95113

              Fax:
      (408) 423-8510

            

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    [Signature Page to Business Financing
Agreement]

    
      
        
          WEST\21453667.4

          355157-000030ex10_18borroweragreemt.htm

Exhibit 10.18

    

    

    

    

    

    

    

    

    

    

    

    

    Export-Import
Bank of the United States

    Working
Capital Guarantee Program

    

    

    

     

    Borrower
Agreement

     

    
      
        
          Ex-Im Bank 12/31/05

          WEST\21453696.3

          355157-000030

        

         

      

      
         

        
          

        

      

      
         

      

    

    

     

    TABLE
OF CONTENTS

     

    
      	
              ARTICLE
      IDEFINITIONS

            	
               

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              1.01

            	
              Definition of
      Terms 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              1.02

            	
              Rules of
      Construction 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              1.03

            	
              Incorporation of
      Recitals 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
              ARTICLE
      IIOBLIGATIONS OF
      BORROWER

            	
               

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.01

            	
              Use of Credit
      Accommodations 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.02

            	
              Security
      Interests 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.03

            	
              Loan Documents and
      Loan Authorization Agreement 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.04

            	
              Export-Related
      Borrowing Base Certificates and Export
    Orders 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.05

            	
              Schedules, Reports and
      Other Statements 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.06

            	
              Exclusions from the
      Export-Related Borrowing Base 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.07

            	
              Borrowings and
      Reborrowings 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.08

            	
              Repayment
      Terms 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.09

            	
              Financial
      Statements 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.10

            	
              Additional Security or
      Payment 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.11

            	
              Continued Security
      Interest 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.12

            	
              Inspection of
      Collateral and Facilities 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.13

            	
              General
      Intangibles 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.14

            	
              Economic Impact
      Approval 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.15

            	
              Indirect
      Exports 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.16

            	
              Overseas Inventory and
      Accounts Receivable 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.17

            	
              Country Limitation
      Schedule 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.18

            	
              Notice of Certain
      Event 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.19

            	
              Insurance 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.20

            	
              Taxes 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.21

            	
              Compliance with
      Laws 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.22

            	
              Negative
      Covenants 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.23

            	
              Cross
      Default 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.24

            	
              Munitions
      List 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              2.25

            	
              Suspension and
      Debarment, etc 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
              ARTICLE
      IIIRIGHTS AND
      REMEDIES

            	
               

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      
        
           

          Ex-Im Bank 12/31/05

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          355157-000030

        

         

      

      
         

        
          

        

      

      
         

      

    

    
      	
              3.01

            	
              Indemnification 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              3.02

            	
              Liens 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
              ARTICLE
      IVMISCELLANEOUS

            	
               

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              4.01

            	
              Governing
      Law 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              4.02

            	
              Notification 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              4.03

            	
              Partial
      Invalidity 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              4.04

            	
              Waiver of Jury
      Trial 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    
      	
               
      

            	
              4.05

            	
              Consequential
      Damages 

            	
              [INSERT PAGE
NUMBER]

            

    

     

    

    
      
        
           

          Ex-Im Bank 12/31/05

          WEST\21453696.3

          355157-000030

        

         

      

      
         

        
          

        

      

      
         

      

    

    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 (collectively, "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.

    
      
        
          WEST\21453696.3

           

          355157-000030 

           

        

         

      

      
         

        
          

        

      

      
         

      

    

    “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.

    
      
        
           

          WEST\21453696.3

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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;

    
      
        
           

          WEST\21453696.3

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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

    
      
        
           

          WEST\21453696.3

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    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;

    

    (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.

    
      
        
           

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    “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

    
      
        
           

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    accordance
with Section 2.01(b)(ii) of this Agreement and are specified in Section 4.A. of
the Loan Authorization Agreement.

    

    "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.

    
      
        
           

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    "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.

    

    "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

    
      
        
           

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    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.

    

    "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.

    
      
        
           

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    “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

    
      
        
           

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    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.

    

    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.

    

    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.

    
      
        
           

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    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.

    
      
        
           

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    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.

    

    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.

    
      
        
           

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    (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.

    

    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

    
      
        
           

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    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.

    

               (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

    
      
        
           

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    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;

    

    (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.

    
      
        
           

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    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;

     

    (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.

    
      
        
           

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    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.

    

    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

    
      
        
           

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    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.

    

    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.

    
      
        
           

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    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.

    
      
        
           

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    IN
WITNESS WHEREOF, Borrower has caused this Agreement to be duly executed as of
September 3, 2008.

     

    
      	 
      	
              ALPHA
      INNOTECH CORP.

              By:                                                                

              Title:

            
	 
      	
              Acknowledged:

               

              Bridge
      Bank, National Association

              By:                                                                

              Title:                                                                

            

    

    
      
        
           

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Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00147-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00147-of-00352.parquet"}]]