Common use of Eligible Accounts Clause in Contracts

Eligible Accounts. Upon Borrower’s delivery to Lender of a Borrowing Base Certificate, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider the following requirements: (a) The Account is not owing more than ninety (90) days after the date of the original invoice or other writing evidencing such Account; (b) it is not owing by an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Account.

Eligible Accounts. Upon On any date of determination of the Borrowing Base, all of the Accounts owned by any Borrower’s delivery to Lender of a , as applicable, and reflected in the most recent Borrowing Base CertificateCertificate delivered by the Borrower Representative to the Collateral Agent and the Administrative Agent, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are be “Eligible Accounts”” for the purposes of this Agreement, except any Account to which any of the exclusionary criteria set forth below applies. In making this determination, Lender will consider Eligible Accounts shall not include any of the following requirementsAccounts: (ai) The any Account is not owing more than ninety (90) days after in which the date Collateral Agent, on behalf of the original invoice or other writing evidencing such AccountSecured Parties, does not have a valid perfected First Priority Lien; (bii) it any Account that is not owing owned by a Credit Party; (iii) any Account due from an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it that is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office domiciled in the United States of America or Canada, Canada and (iiif not a natural person) is not organized under the laws of the United States of America, or Canada or any state political subdivision thereof; (iv) any Account that is payable in any currency other than Dollars; (v) any Account that does not arise from the sale of goods or the performance of services by such Credit Party in the ordinary course of its business; (vi) any Account that does not comply with all applicable legal requirements, or under the laws including, without limitation, all laws, rules, regulations and orders of any province Governmental Authority; (vii) any Account which is owed by an Account Debtor located in Canadaany jurisdiction which requires filing of a “Notice of Business Activities Report” or other similar report in order to permit the applicable Borrower to seek judicial enforcement in such jurisdiction of payment of such Account, unless such Borrower (at the time the Account was created and at all times thereafter) (i) has qualified to do business in such jurisdiction and such qualification enables Borrower to seek judicial recourse in such jurisdiction, (ii) had filed and has filed and maintained effective such report with the appropriate office or agency of in such jurisdictions, as applicable, or (iii) is was and has continued to be exempt from filing such report and has provided the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality Collateral Agent with satisfactory evidence thereof; (iviii) it any Account (a) upon which the right of a Borrower, as applicable, to receive payment is not absolute or is contingent upon the fulfillment of any condition whatsoever unless such condition is satisfied or (b) as to which such Borrower is not able to bring suit or otherwise enforce its remedies against the Account Debtor through judicial or administrative process or (c) that represents a progress billing consisting of an invoice for goods sold or used or services rendered pursuant to a contract under which the Account Debtor’s obligation to pay that invoice is subject to a Borrower’s or any Guarantor’s, as applicable, completion of further performance under such contract or is subject to the equitable lien of a surety bond issuer; (ix) to the extent that any defense, counterclaim, setoff or dispute is asserted as to such Account, it being understood that the amount of any such defense, counterclaim, setoff or dispute shall be disclosed to the Collateral Agent and that the remaining balance of the Account shall be eligible; (x) [RESERVED] (xi) any Account with respect to which an invoice or other electronic transmission constituting a request for payment, reasonably acceptable to the Collateral Agent in form and substance, has not been sent on a timely basis to the applicable Account Debtor according to the normal invoicing and timing procedures of a Borrower, as applicable; (xii) any Account that arises from a sale to any director, officer, other employee or Affiliate of any Credit Party, or to any entity that has any common officer or director with any Credit Party; (xiii) to the extent Holdings or any Subsidiary is liable for goods sold or services rendered by the applicable Account Debtor to any Credit Party or any Subsidiary of a Credit Party but only to the extent of the potential offset; (xiv) any Account that arises with respect to goods that are delivered on a ▇▇▇▇-and-hold, cash-on-delivery basis or placed on consignment, guaranteed sale or other terms by reason of which the payment by the Account Debtor is or may be conditional; (xv) any Account that is in default; provided, that, without limiting the generality of the foregoing, an Account owing by shall be deemed in default upon the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality occurrence of any of the foregoingfollowing: (1) that portion of any Account that is more than sixty (60) days past due according to its original terms of sale or which has been written off or designated as uncollectible by such Borrower (and, for the avoidance of doubt, the remainder of any such Account shall not be in default for purposes hereof unless all Accounts of the applicable Account Debtor are ineligible pursuant to clause (xvi) below); or (2) the Account Debtor obligated upon such Account suspends business, makes a general assignment for the benefit of creditors, has become insolvent, admits in writing its inability to pay its bills as they become due or fails to pay its debts generally as they come due; or (3) a petition is filed by or against any Account Debtor obligated upon such Account under any bankruptcy law or any other federal, state or foreign (including any provincial) receivership, insolvency relief or other law or laws for the relief of debtors; or (4) the payment terms (at inception or as modified from time to time) of any Account are not reasonably satisfactory to the Administrative Agent or Collateral Agent (it being understood that Borrowers’ customary terms as of the Closing Date are satisfactory to the Administrative Agent and the Collateral Agent); (xvi) any Account that is the obligation of an Account Debtor (other than an individual) if 50% or more of the Dollar amount of all Accounts owing by that Account Debtor are ineligible under the other criteria set forth in clause (xv) above; (xvii) any Account as to which any of the representations or warranties in the Loan Documents are untrue; (xviii) to the extent such Account is evidenced by a judgment, Instrument or Chattel Paper; (xix) to the extent (A) the Accounts owing from such Account Debtor and its Affiliates to the Borrowers exceeds 20% of the aggregate of all Eligible Accounts or (B) exceeds any credit limit established by the Collateral Agent, in good faith and in the exercise of reasonable (from the perspective of a secured asset-based lender) business judgment, following prior notice of such limit by the Collateral Agent to the Borrower Representative; (xx) that portion of any Account (1) in respect of which there has been, or should have been, established by a Borrower or any Guarantor a contra account, whether in respect of contractual allowances with respect to such Account, audit adjustment, anticipated discounts or otherwise or (2) which is due from an Account Debtor to whom any Credit Party owes a trade payable, but only to the extent of such trade payable; (xxi) any Account on which the Account Debtor is a Governmental Authority, unless all necessary steps are taken a Credit Party, as applicable, has assigned its rights to comply with payment of such Account to the Federal Administrative Agent pursuant to the Assignment of Claims Act of 1940, as amended, or with any comparable state in the case of a federal Governmental Authority, and pursuant to applicable law, if applicableany, in the case of any other Governmental Authority, and all other necessary steps are taken to perfect Lender’s security interest such assignment has been accepted and collection rights in such Account.acknowledged by the appropriate government officers; or (jxxii) it any Account which is not owing by due from an Account Debtor for which Borrower that has received been structured as note payable or has been restructured as a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Accountnote payable.

Eligible Accounts. Upon Borrower’s delivery to Lender of a Borrowing Base Certificate, Lender The Agent shall determinehave the right, in its the exercise of the Agent’s reasonable discretion, which to determine whether Accounts listed thereon are eligible for inclusion in the Borrowing Base at any particular time (such eligible accounts being referred to as “Eligible Accounts”). In making this determinationWithout limiting the Agent’s right to determine that Accounts do not constitute Eligible Accounts, Lender will consider the following requirements: Accounts shall not be Eligible Accounts: (a) The any Account other than an Account arising from a completed sale (not a b▇▇▇-and-hold, undelivered sale, sale or return, consignment or sale-on-approval basis) of “livestock” (as defined in PASA) or of processed pork products by Borrower; (b) any Account other than an Account denominated in U.S. Dollars; (c) all Accounts owing by an Account Debtor that is not owing more than ninety a meat packer in connection with the sale of “livestock” (90as defined in PASA) which are at that time unpaid for a period exceeding seven (7) days after the delivery date of the livestock related thereto; (d) all Accounts other than those described in the preceding clause c, which are at that time unpaid for a period exceeding twenty one days (21) days after the original invoice date of the original invoice or other writing evidencing such Account; related thereto; (be) it is not all Accounts owing by an Account Debtor who has failed to pay twenty-if more than ten percent (10%) of the Accounts owing by such Account Debtor are at that time unpaid for a period exceeding that permitted by the preceding clause c or clause d, respectively; (c) those Accounts, except Accounts owing from the Account Debtors listed on Exhibit 3A, of an Account Debtor, the aggregate face amount of which is in excess of five percent (255%) or more of the aggregate face amount of its all other Eligible Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or all other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such AccountDebtors; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not those Accounts owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in from the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate agency or other instrumentality of any of the foregoing, thereof unless all necessary steps are taken to comply Borrower shall have complied with the Federal Assignment of Claims Act to the satisfaction of 1940, as amended, or the Agent; (e) Accounts which arise out of transactions with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. Affiliates; (jf) it is not owing by Accounts of an Account Debtor for that is located outside the United States, unless such Accounts are covered by a letter of credit issued or confirmed by a bank acceptable to the Agent or are covered by foreign credit insurance acceptable to the Agent; (g) Accounts which Borrower has received a notice of (i) the death of the Account Debtor are or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, may be subject to a retainage rights of setoff or holdback counterclaim by the Account Debtor (to the extent of the amount of such setoff or insured by counterclaim); (h) Accounts in which the Agent does not, for any reason, have a surety company; first priority perfected security interest; and (1i) If Accounts which in the Account Debtor is located in either the State Agent’s opinion may be subject to liens or conflicting claims of New Jerseyownership, the State of Minnesota, whether such liens or the State of Indiana, Borrower has filed a Notice of Business Activities Report conflicting claims are asserted or comparable report with the applicable state authority for the then current year; (m) it is not owing could be asserted by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible AccountPerson.

Eligible Accounts. Upon Borrower’s delivery to Lender On any date of a determination of the Borrowing Base, all of the Accounts owned by Borrower or its Subsidiary Guarantors and reflected in the most recent Borrowing Base Certificate, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider the following requirements: (a) The Account is not owing more than ninety (90) days after the date of the original invoice or other writing evidencing such Account; (b) it is not owing by an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and Certificate delivered by Borrower to Lender and is acceptable Administrative Agent shall be “Eligible Accounts” for the purposes of this Agreement, except any Account to Lenderwhich any of the exclusionary criteria set forth below applies. Eligible Accounts shall not include any of the following Accounts: (i) any Account on which Collateral Agent, on behalf of the Secured Parties, does not have a perfected, first priority Lien subject to no other Liens that are pari passu or prior to the Liens securing the Secured Obligations (other than inchoate or other Liens (including tax Liens) arising by operation of law); (fii) it is a valid, legally enforceable obligation of the any Account Debtor thereunder, and that is not subject to any offset, counterclaim owned by Borrower or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in partits Subsidiary Guarantors; (giii) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by Account due from an Account Debtor which (i) does that is not maintain its chief executive office domiciled in the United States of America or Canada, Canada and (iiif not a natural Person) is not organized under the laws of the United States, Canada or any political subdivision thereof, unless the Account is supported by an irrevocable letter of credit satisfactory to Administrative Agent, in its Permitted Discretion (as to form, substance, and issuer or domestic confirming bank), that has been delivered to Collateral Agent and is directly drawable by Collateral Agent; (iv) any Account that is payable in any currency other than an Approved Currency; (v) any Account that does not arise from the sale of goods or the performance of services by Borrower or its Subsidiary Guarantors in the ordinary course of their business; (vi) any Account that does not comply in all material respects with all applicable legal requirements, including, without limitation, all laws, rules, regulations and orders of any Governmental Authority; (vii) any Account (a) to the extent that Borrower’s or its Subsidiary Guarantors’ right to receive payment is not absolute or is contingent upon the fulfillment of any condition whatsoever unless such condition is satisfied or (b) as to which Borrower or its Subsidiary Guarantors is not able to bring suit or otherwise enforce its remedies against the Account Debtor through judicial or administrative process or (c) that represents a progress billing consisting of an invoice for goods sold or used or services rendered pursuant to a contract under which the Account Debtor’s obligation to pay that invoice is subject to Borrower’s or its Subsidiary Guarantors’ completion of further performance under such contract or is subject to the equitable lien of a surety bond issuer; (viii) to the extent that any defense, counterclaim, setoff or dispute is asserted as to such Account, it being understood that the remaining balance of the Account shall be eligible; (ix) any Account that is not a true and correct statement of bona fide indebtedness incurred in the amount of the Account for merchandise sold to or services rendered and accepted by the applicable Account Debtor; (x) any Account with respect to which an invoice or other electronic transmission constituting a request for payment, reasonably acceptable to Administrative Agent in form and substance, has not been sent on a timely basis to the applicable Account Debtor according to the normal invoicing and timing procedures of such Borrower or Subsidiary Guarantor; (xi) any Account that arises from a sale to any director, officer, other employee or Affiliate of Borrower or a Guarantor, or to any entity that has any common officer or director with Borrower or a Guarantor, to the extent that the aggregate amount of any such Accounts exceeds $100,000; provided that this clause (xi) shall not exclude any Account of an Account Debtor solely on the basis that it is a portfolio company of any Sponsor; (xii) to the extent Borrower or any Guarantor or Subsidiary is liable for goods sold or services rendered by the applicable Account Debtor to any Borrower or any Guarantor or Subsidiary but only to the extent of the potential offset; (xiii) any Account that arises with respect to goods that are delivered on a ▇▇▇▇-and-hold, cash-on-delivery basis or placed on consignment, guaranteed sale or other terms by reason of which the payment by the Account Debtor is or may be conditional; (xiv) any Account that is in default; provided that, without limiting the generality of the foregoing, an Account shall be deemed in default upon the occurrence of any of the following: (A) any Account not paid within 120 days following its original invoice date; or (B) the Account Debtor obligated upon such Account suspends business, makes a general assignment for the benefit of creditors or fails to pay its debts generally as they come due; or (C) a petition is filed by or against any Account Debtor obligated upon such Account under any bankruptcy law or any other federal, state or foreign (including any provincial) receivership, insolvency relief or other law or laws for the relief of debtors; (xv) any Account that is the obligation of an Account Debtor if 50% or more of the dollar amount of all Accounts owing by that Account Debtor are ineligible under the other criteria set forth in this Section 2.20(a); (xvi) any Account as to which any of the representations or warranties in the Loan Documents are untrue in any material respect (or, with respect to representations or warranties that are qualified by materiality, after giving effect to such qualification, any of such representations and warranties are untrue); (xvii) to the extent such Account is evidenced by a judgment, Instrument or Chattel Paper; (xviii) to the extent such Account exceeds any credit limit established by Administrative Agent, in its Permitted Discretion, based on the credit characteristics of the applicable Account Debtor; or (xix) any Account on which the Account Debtor is a Governmental Authority, unless (a) if the Account Debtor is the United States of America, any State or political subdivision thereof or any state thereofdepartment, agency or under the laws instrumentality of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state State or political subdivision thereof, Borrower or by any department, agency, public body corporate or other instrumentality its Subsidiary Guarantors have assigned their rights to payment of any of such Account to Administrative Agent pursuant to the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, or with in the case of any comparable state such federal Governmental Authority, and pursuant to any requirements of applicable law, if applicableany, in the case of any such other Governmental Authority, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. (jb) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If if the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indianaany other Governmental Authority, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing its Subsidiary Guarantors have if required by any Account Debtor whose obligations Lenderapplicable law, acting in its sole discretion, shall have notified Borrower are not deemed assigned their rights to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) payment of such Accounts shall not be eligibleAccount to Administrative Agent pursuant to applicable law, regardless of whether if any, and, in each such Accounts otherwise satisfy case where such acceptance and acknowledgment is required by applicable law, such assignment has been accepted and acknowledged by the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails appropriate government officers to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Accountextent so required.

Eligible Accounts. Upon Borrower’s delivery to Lender On any date of a determination of the Borrowing Base, all of the Accounts owned by the Borrower and reflected in the most recent Borrowing Base Certificate, Lender Certificate delivered by the Borrower to the Administrative Agent and Collateral Agent shall determine, in its reasonable discretion, which Accounts listed thereon are be “Eligible Accounts”” for the purposes of this Agreement, except any Account to which any of the exclusionary criteria set forth below applies. In making this determinationaddition, Lender will consider the Administrative Agent shall have the right from time to time to establish, modify or eliminate Reserves against Eligible Accounts. Eligible Accounts shall not include any of the following requirementsAccounts: (ai) The any Account is not owing more than ninety (90) days after in which the date Collateral Agent, on behalf of the original invoice or other writing evidencing such AccountSecured Parties does not have a perfected, first priority Lien (save for any Permitted Prior Liens which may be senior thereto); (bii) it any Account that is subject to a Lien other than (x) Permitted Prior Liens described in clause (i) above, or (y) Permitted Liens that are junior to the Lien of the Collateral Agent on terms reasonably satisfactory to the Administrative Agent; (iii) any Account that is not owing owned by a Borrower; (iv) any Account that constitutes MLC Separate Assets and Collateral or is otherwise due from MLC; (v) any Account due from an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it that is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office domiciled in the United States of America or Canada, Canada or any province or territory thereof and (iiif not a natural person) is not organized under the laws of the United States or any political subdivision thereof or Canada or any province or territory thereof unless supported by an irrevocable letter of credit (up to the face amount of such letter of credit) that is in form and substance acceptable to the Administrative Agent, and that is issued by a bank that is and continues to be acceptable to the Administrative Agent. (vi) any Account that is payable in any currency other than in dollars; (vii) any Account that does not arise from the sale of goods or the performance of services by the Borrower in the ordinary course of its business which goods or services have been delivered or fully performed, respectively; (viii) any Account that does not comply in all material respects with all applicable legal requirements, including all laws, rules, regulations and orders of any Governmental Authority (including the Federal Consumer Credit Protection Act, the Federal Truth in Lending Act and Regulation Z of the Board); (ix) any Account (a) to the extent that the Borrower’s right to receive payment is not absolute or is contingent upon the fulfillment of any condition whatsoever unless such condition is satisfied, (b) as to which a Borrower is not able to bring suit or otherwise enforce its remedies against the Account Debtor through judicial or administrative process, or (c) that represents a progress billing consisting of an invoice for goods sold or used or services rendered pursuant to a contract under which the Account Debtor’s obligation to pay that invoice is subject to the Borrower’s completion of further performance under such contract or is subject to the equitable lien of a surety bond issuer in each case set forth in (a), (b) or (c), to the extent such Account is subject to such condition, inability to bring suit or subject to progress billing or lien; (x) to the extent that any defense, counterclaim, setoff or dispute is asserted as to such Account, it being understood that the remaining balance of the Account shall be eligible; (xi) any Account that is not bona fide indebtedness incurred in the amount of the Account for merchandise sold to or services rendered and accepted by the applicable Account Debtor; (xii) any Account with respect to which an invoice or other electronic transmission (in a form reasonably acceptable to the Administrative Agent) constituting a request for payment, has not been sent on a timely basis to the applicable Account Debtor according to the normal invoicing and timing procedures of the Borrower; (xiii) any Account that arises from a sale to any Loan Party, director, officer, other employee or Affiliate of a Loan Party, or to any entity that has any common officer or director with a Loan Party; (xiv) any Account to the extent the Borrower is liable for goods sold or services rendered by the applicable Account Debtor to the Borrower but only to the extent of the potential offset, except to the extent any waivers of offset rights, which are in form and substance reasonably satisfactory to the Administrative Agent, are in effect in respect of such Account; (xv) any Account that arises with respect to goods that are delivered on a ▇▇▇▇-and-hold, cash-on-delivery basis or placed on consignment, guaranteed sale or other terms by reason of which the payment by the Account Debtor is or may be conditional; (xvi) any Account that is in default; provided, that without limiting the generality of the foregoing, an Account shall be deemed in default upon the occurrence of any of the following: (A) such Account is not paid within 60 days following its original invoice date; or (B) such Account is not paid within 30 days following its original due date; (C) the Account Debtor obligated upon such Account suspends business, makes a general assignment for the benefit of creditors or fails to pay its debts generally as they come due; or (D) in respect of which a petition is filed by or against any Account Debtor obligated upon such Account under any bankruptcy law or any other federal, state or foreign (including any provincial) receivership, insolvency relief or other law or laws for the relief of debtors; (xvii) any Account that is the obligation of an Account Debtor if 50% or more of the dollar amount of all Accounts owing by that Account Debtor are ineligible under the other criteria set forth in this Section 2.21(a) (other than clauses (i), (v) and (vi)); (xviii) any Account (A) which is owing by an Account Debtor (whose securities are rated BBB- or better by S&P or Baa3 or better by Moody’s) to the extent the aggregate amount of Accounts owing from such Account Debtor and its Affiliates to the Borrower exceeds $30,000,000 (but such Account shall only be ineligible to the extent of such excess) or (B) which is owing by any other Account Debtor to the extent the aggregate amount of Accounts owing from such Account Debtor and its Affiliates to the Borrower exceeds $10,000,000 (but such Account shall only be ineligible to the extent of such excess); (xix) any Account which is owed by any Account Debtor which has sold all or a substantially all of its assets; (xx) any Account which is owed by an Account Debtor located in any jurisdiction which requires filing of a “Notice of Business Activities Report” or other similar report in order to permit the Borrower to seek judicial enforcement in such jurisdiction of payment of such Account, unless the Borrower has filed such report or qualified to do business in such jurisdiction; (xxi) any Account that is subject to any contractual provision accepted in writing by the Borrower prohibiting its assignment or requiring notice of or consent to such assignment which notice or consent has not been obtained; (xxii) any Account with respect to which the Borrower has made any agreement with the Account Debtor for any reduction thereof, other than discounts and adjustments given in the ordinary course of business, or any Account which was partially paid and the Borrower created a new receivable for the unpaid portion of such Account; (xxiii) any Account as to which any of the representations or warranties in the Loan Documents in respect of Accounts are untrue; (xxiv) any Account to the extent such Account is evidenced by a judgment, Instrument or Chattel Paper; (xxv) any Account to the extent such Account exceeds any credit limit established by the Administrative Agent, in its reasonable credit judgment exercised in good faith; or (xxvi) any Account on which the Account Debtor is a Governmental Authority, unless (a) if the Account Debtor is the United States of America, any state or political subdivision thereof or any state thereofdepartment, agency or under the laws instrumentality of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality the Borrower has assigned its rights to payment of any of such Account to the foregoing, unless all necessary steps are taken applicable Administrative Agent pursuant to comply with the Federal Assignment of Claims Act of 1940, as amended, or with in the case of any comparable state lawsuch federal Governmental Authority, and pursuant to any Requirements of Law, if applicableany, in the case of any such other Governmental Authority, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. (jb) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If if the Account Debtor is located in either the State of New Jerseyany other Governmental Authority, the State of MinnesotaBorrower has, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing if required by any Account Debtor whose obligations LenderRequirements of Law, acting in assigned its sole discretion, shall have notified Borrower are not deemed rights to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) payment of such Accounts shall not be eligibleAccount to the Administrative Agent pursuant to Requirements of Law, regardless if any, and, in each such case where such acceptance and acknowledgment is required by Requirements of whether Law, such Accounts otherwise satisfy assignment has been accepted and acknowledged by the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails appropriate government officers to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Accountextent so required.

Eligible Accounts. Upon Borrower’s delivery to Lender The definition of a Borrowing Base Certificate, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider the following requirements” shall be amended as follows: (ai) The Account clause (c) of the definition of “Eligible Accounts” shall be amended and restated in its entirety to read as follows: (c) (i) with respect to which the scheduled due date is not owing more than ninety 90 days after the original invoice date, (90ii) is unpaid more than 120 days after the date of the original invoice therefor, (iii) is unpaid more than 60 days after the original due date, or other writing evidencing such Account(iv) which has been written off the books of the Borrower or Eligible Subsidiary (if applicable) or otherwise designated as uncollectible; (bii) it is clause (d) of the definition of “Eligible Accounts” shall be amended by replacing the phrase “ineligible hereunder” with “ineligible under clause (c) hereof”; (iii) clause (e)(ii) of the definition of “Eligible Accounts” shall be amended by inserting “(or such percentage, up to a maximum of 35%, approved by the Administrative Agent in its sole discretion for those Account Debtors of the Canadian Borrower, the UK Borrower and the Eligible UK Subsidiaries that are unrated or do not owing meet the rating requirements under clause (e)(i) hereof)” after the reference to “20%”; (iv) clause (e) of the definition of Eligible Accounts shall be amended by an inserting the following immediately prior to the semi-colon at the end of clause (e) of such definition: “; provided, that (x) those Accounts that satisfy the requirements of clause (l) hereof as a result of delivery of a letter of credit acceptable to the Administrative Agent, which may include a letter of credit allowing for payment terms to be delayed up to 180 days, shall not be subject to the concentration limits set forth in clauses (e)(i) and (e)(ii) hereof and (y) the Administrative Agent, in its sole discretion, may waive the concentration limits set forth in clauses (e)(i) and (e)(ii) hereof for all Accounts of the Canadian Borrower; provided that such waiver may not be granted by the Administrative Agent if the aggregate Eligible Accounts of such Account Debtor who has failed and its Affiliates owing to pay twenty-the Canadian Borrower and its Eligible Subsidiaries exceeds five percent (255%) or more of the aggregate amount of its all Eligible Accounts owing to Borrower within ninety (90) days after the date of the US Borrower and the Canadian Borrower (and their respective invoices or other writings evidencing such Accounts;Eligible Subsidiaries)”; and (cv) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; clause (dl)(A) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part definition of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute “Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of ” shall be amended by replacing the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails reference to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Account“$4,000,000” with “$6,000,000”.

Eligible Accounts. Upon Borrower’s delivery the United States dollar value (net of finance charges and/or service charges) of only such Accounts of the Borrower arising from the ordinary course of business in which the Lender holds a first priority security interest and as to Lender of a Borrowing Base Certificate, Lender shall determinewhich the Lender, in its reasonable discretionbusiness judgment, which shall from time to time determine to be collectible in a timely manner in the ordinary course of business without dispute or set-off. Without limiting the Lender’s right, in its reasonable business judgment, to consider any Account not to be an Eligible Account, and by way of example only of types of Accounts listed thereon are “Eligible Accounts”. In making this determination, that the Lender will consider not to be Eligible Accounts, the following requirements: Lender, notwithstanding any earlier classification of eligibility, may consider any Account not to be an Eligible Account if: (a) The any warranty is breached as to the Account or the Account debtor disputes liability or makes any claim with respect to the Account; (b) (i) the Account is not owing more than ninety (90) paid by the Account debtor within 90 days after the date of the original invoice relating thereto; or other writing evidencing such Account; (bii) it the Account is not owing owed by an any Account Debtor debtor who has failed to pay twenty-five percent (not paid 25%) % or more of such Account debtor’s Accounts within the aggregate amount of its Accounts owing to Borrower within ninety time period specified in subsection (90b)(i) days after the date of the respective invoices or other writings evidencing such Accounts; above; (c) it arises from the sale of goods and such goods have been shipped a petition in bankruptcy or delivered other application for relief under any insolvency law is filed with respect to the Account Debtor under such debtor owing the Account, or the Account debtor owing the Account assigns for the benefit of creditors, becomes insolvent, fails, suspends, or goes out of business, or the Lender, in its reasonable business judgment, shall become dissatisfied with the creditworthiness of an Account debtor owing an Account; or it arises from services rendered and such services have been performed; (d) it the Account arises from a sale to an Account debtor outside the United States, unless the sale is evidenced by an invoiceon letter of credit, dated not later than the date of shipment acceptance or performance, rendered to such Account Debtor or some other evidence of billing terms acceptable to Lender; the Lender in its sole and absolute discretion; (e) it the Account debtor is not evidenced by any notean Affiliate, trade acceptance, draft supplier or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; creditor of the Borrower; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and debtor is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state agency or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of department thereof and the foregoing, unless all necessary steps are taken Account is subject to comply with the Federal Assignment of Claims Act of 1940, as amended, Act; or with (g) any comparable state law, if applicable, and all other necessary steps are taken Account covering inventory which has not been shipped to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Accountdebtor.

Eligible Accounts. Upon Borrower’s delivery An “Eligible Account” is an Account that, when scheduled to Lender and at all times thereafter, does not violate the negative covenants and other provisions of a Borrowing Base Certificate, Lender this Section 5 and does satisfy the positive covenants and other provisions of this Section 5. The following Accounts are not and shall determine, in its reasonable discretion, which Accounts listed thereon are “not be considered Eligible Accounts”. In making this determination, Lender will consider the following requirements: (aA) The Account is not owing (i) With respect to Accounts invoiced upon terms of thirty (30) days or less, all such Accounts which remain unpaid for more than ninety (90) days after the date of the original their invoice date, (ii) with respect to Accounts which are invoiced upon terms greater than thirty (30) days, but less than or other writing evidencing equal to sixty (60) days, all such AccountAccounts which remain unpaid more than thirty (30) days after their due date, and (iii) all Accounts which are not due and payable within at least sixty (60) days after their invoice dates; (bB) it is not Accounts owing by an a single Account Debtor who has failed to pay Debtor, including a currently scheduled Account, if twenty-five percent (25%) or more of the aggregate amount balance owing by said Account Debtor is ineligible as a result of its Accounts owing to Borrower within ninety (90Section 5.1(A) days after the date of the respective invoices or other writings evidencing such Accountsabove; (cC) it arises from the sale of goods and such goods have been shipped Accounts which are owing by any Account Debtor involved as a debtor in any bankruptcy or delivered insolvency proceeding, whether voluntary or involuntary; (D) Accounts with respect to which the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliatedirector, officer, employee or partner agent of Borrower or is a Parent, a Subsidiary or an Affiliate of Borrower, nor ; (E) Accounts with respect to which payment by an the Account Debtor is or becomes conditional upon the Account Debtor’s approval of the Goods or services, or is otherwise subject to any repurchase obligation or return right, as with sales made on a ▇▇▇▇-and-hold, guaranteed sale, sale on approval, sale or return or consignment basis; (F) Accounts with respect to which the Account Debtor (i1) does is not maintain its chief executive office a resident, a citizen of or otherwise located in the United States of America or Canada; or (2) is not subject to service of process in the United States of America or Canada, (ii) unless, in either case, such Account is not organized under either backed by a letter of credit acceptable to Lender in its sole discretion which is in the laws of the United States of Americapossession of, has been assigned to and is directly drawable by Lender, or any state thereof, or under the laws of any province is insured by credit insurance which has been assigned to Lender and is acceptable to Lender in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereofits sole discretion; (iG) it Accounts with respect to which the Account Debtor is not an Account owing by (1) the United States of America or any state department, agency or political subdivision instrumentality thereof, or by any department, agency, public body corporate or other instrumentality unless Borrower assigns its right to payment of any of the foregoing, unless all necessary steps are taken such Accounts to comply Lender in accordance with the Federal Assignment of Claims Act of 1940, as amended, or with (2) any comparable state lawcountry other than the United States of America or any department, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account.agency or instrumentality thereof; (jH) it The face amount of any Accounts with respect to which Borrower is not owing by an or may become liable to the Account Debtor for Goods sold or services rendered by such Account Debtor to Borrower, but only to the extent of the maximum aggregate amount of Borrower’s liability to such Account Debtor; (I) Accounts with respect to which Borrower has received a notice of (i1) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of Goods giving rise thereto have not been shipped and delivered to and accepted as satisfactory by the Account Debtor, or (iv2) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws services performed have not been completed and accepted as satisfactory by or against the Account Debtor; (kJ) it is Accounts which are not an account billed in advanceinvoiced, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future dated as of such date in accordance with its terms, subject and sent to a retainage or holdback by the Account Debtor concurrently with the shipment and delivery to and acceptance by said Account Debtor of the goods or insured by a surety companythe performance of the services giving rise thereto; (1K) If Accounts with respect to which possession or control of the goods sold is held, maintained or retained by Borrower, or by any agent or custodian of Borrower, for the account of or subject to further or future direction from the Account Debtor; (L) Accounts with respect to which the Account Debtor is located in a state which requires Borrower, as a precondition to commencing or maintaining an action in the courts of that state, either the State to (1) receive a certificate of New Jersey, the State of Minnesotaauthority to do business and be in good standing in such state, or the State (2) file a notice of Indianabusiness activities report or similar report with such state’ s taxing authority, unless (a) Borrower has filed a Notice taken one of Business Activities Report the actions described in clauses (1) or comparable report with (2), (b) the applicable state authority for failure to take one of the then current yearactions described in either clause (1) or (2) may be cured retroactively by Borrower at its election, or (c) Borrower has proven, to Lender’s satisfaction, that it is exempt from any such requirements under any such state’s laws; (mM) it All or any portion of an Account to the extent there exists or the Account Debtor has asserted a counterclaim or dispute; provided, however, if the amount of such counterclaim or dispute is not equal to or greater than ten percent (10%) of the total Account owing by from such Account Debtor to the applicable Borrower, then the full amount of such Account shall be deemed an ineligible Account; (N) Accounts for any Account Debtor whose obligations Lenderwhich exceed a credit limit established by Lender for such Account Debtor; (O) Accounts as to which any covenant, acting representation or warranty with respect to such Account has been breached; (P) Accounts which arise in its sole discretionany manner other than (1) the performance of services by Borrower in the ordinary course of Borrower’s business, shall and such services have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of been fully performed and acknowledged and accepted by the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Account.thereunder; or

Eligible Accounts. Upon Borrower’s delivery to Lender of a Borrowing Base Certificate, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are “The term "Eligible Accounts”" means the portion of the Borrower's accounts that the Bank determines from time to time, based on credit policies, market conditions, the Borrower's business and other criteria, is eligible for use in calculating the Borrowing Base. In making Without limiting the Bank's right to determine which accounts are Eligible Accounts, no account will be an Eligible Account in calculating the Borrowing Base, unless, at a minimum, such account is unconditionally due and owing to the Borrower from a party (the "Account Debtor") that meets the qualifications stated herein, conforms to the warranties regarding the Accounts contained in this determinationAgreement, Lender will consider and meets all the following requirements: requirements until it is collected in full: (a) The Account the account is due and payable (in U.S. dollars), exclusive of sales or other taxes, and not owing more than ninety (90) days after the date of 90 have elapsed from the original invoice therefor, or other if a special dating program has been approved in writing evidencing by the Bank, the account is due and payable on a date permitted by the terms of such Account; dating program and is not past-due; (b) it is not owing by an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it account arises from the completed performance of a sale of goods and and/or related services, does not constitute a progress billing or advance billing, and, if involving a sale of goods, all such goods have been lawfully shipped or and invoiced to the Account Debtor, and if requested by the Bank, copies of all invoices, together with all shipping documents and delivery receipts evidencing such shipment have been delivered to the Account Debtor under such AccountBank; (c) the account does not arise from a contract with any government or it arises from services rendered and such services have been performed; agency thereof; (d) it the account is evidenced by an invoicenot subject to any prior assignment, dated not later than the date of shipment claim, lien, or performancesecurity interest, rendered or subject to such Account Debtor any levy or some other evidence of billing acceptable to Lender; setoff; (e) it the account is not subject to any credit, contra account, allowance, adjustment, return of goods, or discount (collectively a "Contra"), provided, however, that unless the Account Debtor has asserted a Contra, if the amount of the account exceeds the amount of the Contra, such excess shall be considered for eligibility if such excess meets all other requirements of this Section 2.1; (f) the account does not arise from an Affiliate; (g) the account does not, when added to all other accounts of the Account Debtor with the Borrower, produce an aggregate indebtedness from the Account Debtor of more than 20% of the total of all the Borrower's Eligible Accounts; (h) the Account Debtor is not subject to bankruptcy, receivership or similar proceedings or is not insolvent; (i) the account is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note promissory note, payment instrument or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; written agreement; (fj) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is account does not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by arise from an Account Debtor which (i) does not maintain its chief whose mailing address or executive office in is located outside the United States of America or Canada, (ii) is not organized under the laws one of the Canadian Provinces other than Quebec unless the payment for such account is assured by an irrevocable letter of credit, such letter of credit is from a financial institution acceptable to the Bank, the same has been assigned to the Bank and the original has been delivered to the Bank or the same has been confirmed by a financial institution acceptable to the Bank and is in form and substance acceptable to the Bank, payable in the full amount of the account in United States dollars at a place of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by payment located within the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of States; (k) the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. (j) it is account does not owing by arise from an Account Debtor for which Borrower has received to whom goods are shipped on a notice of "cash on delivery" or C.O.D. basis; (il) the death of the Account Debtor or any partner of the account does not arise from an Account Debtor, having 50% or more of its accounts with the Borrower (iiin dollar value or in number of accounts) not Eligible Accounts pursuant to this Section 2.1; and (m) the dissolution, liquidation, termination of existence, insolvency Bank has not notified the Borrower that the account or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either unsatisfactory or unacceptable (although the State of New Jersey, Bank reserves the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting right to do so in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor discretion at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Account).

Eligible Accounts. Upon Borrower’s 's delivery to Lender of a Borrowing Base Certificatean Accounts Report, Lender shall determine, in its reasonable discretionsole and absolute discretion and in the exercise of good faith, which individual Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider the following requirements: (aA) The If the individual Account is not owing more than ninety (90) days after the date of the original invoice or other writing evidencing such Account; (b) it is not owing by an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and goods, such goods have been shipped or delivered on open account and on an absolute sale basis and not on consignment, on approval or on a sale-or-return basis or subject to the Account Debtor under any other repurchase or return agreement and no material part of such Account; goods has been returned (other than returns described in Section 7.4), repossessed, rejected, lost or it arises from services rendered and such services have been performeddamaged; (dB) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such The individual Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by chattel paper or an instrument of any notekind; (C) The Account Debtor obligated on such individual Account is not insolvent or the subject of any bankruptcy or insolvency proceeding of any kind and Lender is satisfied with the creditworthiness of such Account Debtor; (D) If the individual Account is owing from an Account Debtor located outside the United States, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously Account Debtor has furnished the Borrower with an irrevocable letter of credit which has been endorsed and delivered issued or confirmed by Borrower to Lender and is a financial institution acceptable to Lender, is in form and substance acceptable to Lender, has been pledged to Lender, and is payable in United States dollars in an amount not less than the face value of the individual Account; (fE) it The individual Account is a valid, legally enforceable obligation of the relevant Account Debtor and such Account Debtor has not asserted any offset, counterclaim or defense denying liability thereunder; provided, however, that if such offset, counterclaim or defense has been asserted, such Account shall be ineligible only to the extent of such asserted offset, counterclaim or defense; (F) The individual Account is subject to and covered by Lender's perfected security interest and is not subject to any offsetother lien, counterclaim claim, encumbrance or security interest, except for the Permitted Liens; (G) The individual Account is evidenced by an invoice or other defense on documentation in form acceptable to Lender; (H) The individual Account has not remained unpaid for a period exceeding ninety (90) days after the part related invoice date; (I) Accounts owing by a single Account Debtor or its Affiliate (whether or not such Affiliate is known by Borrower to be an Affiliate of such Account Debtor Debtor), including currently scheduled Accounts, if fifty percent (50%) or to any claim on more of the part of balance owing by such Account Debtor denying liability thereunder and its Affiliates, in whole or the aggregate, upon Accounts remain ineligible by reason of the criteria set forth in partclause (H) above; (gJ) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it The individual Account is not owing by a parent, subsidiary, affiliatefrom an employee, officer, employee agent, director or partner stockholder of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, Borrower or any state thereof, Affiliate or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by from the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate agency or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account.thereof; (jK) it is not owing by an Account Debtor for Accounts with respect to which Borrower has received a notice of (i) the death of the Account Debtor is a director, officer, employee or any partner agent of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account DebtorBorrower, or (iv) is a subsidiary or an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account DebtorAffiliate; (kL) it is not an account billed Each of the warranties and representations set forth in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable Section 9.2 has been reaffirmed with respect to such individual Account at a future date in accordance with its terms, subject the time that the most recent Accounts Report was delivered to a retainage or holdback by the Account Debtor or insured by a surety companyLender; (1M) The individual Account is one against which Lender is legally permitted to make loans and advances; (N) If the Account Debtor is located in either the State of New Jersey, the State all Accounts of Minnesota, or the State of Indiana, such Account Debtor unless Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority New Jersey Division of Taxation for the then current year;; and (mO) it is not owing by any If the Account Debtor whose obligations Lenderis located in the State of Minnesota, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes all Accounts of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one such Account Debtor at any time, then unless Borrower has filed a Business Activity Report with the excess Minnesota Department of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible AccountRevenue.

Eligible Accounts. Upon Borrower’s delivery to Lender All Accounts of a Borrowing Base Certificate, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider Borrower and each Guarantor meeting all of the following requirements: specifications: (ai) The the Account is lawfully and exclusively owned by Borrower and such Guarantor, as the case may be and subject to no Lien (other than Permitted Liens, if applicable, and Liens granted under this Agreement) and Borrower and such Guarantor has the right of assignment thereof and the power to grant a security interest therein; (ii) the Account is valid and enforceable representing the undisputed indebtedness of an Account Debtor not more than 30 days past the due, with respect to the Designated Accounts, or 90 days past the original invoice date, with respect to any other Account, and the Account does not represent a rebilling; (iii) not more than 25% of the aggregate balance of all Accounts owing from an Account Debtor obligated on the Account are outstanding more than 90 days past their original invoice dates; (iv) the amount of the Account, when aggregated with all other Accounts of such Account Debtor, is less than 10% of the face value of all Accounts of Borrower and the Guarantors then outstanding; (v) the Account is not owing more than ninety subject to any defense, set-off, or counterclaim, deduction, discount, credit, chargeback, freight claim, allowance or adjustment of any kind; (90vi) days after the date of the original invoice such sale was an absolute sale and not on consignment or on approval or on a sale-or-return basis nor subject to any other writing evidencing such Account; (b) it is not owing by an Account Debtor who has failed to pay twenty-five percent (25%) repurchase or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods return agreement, and such goods have been shipped or delivered to the Account Debtor under such Accountor its designee; (vii) no notice of the bankruptcy, receivership, reorganization, liquidation, dissolution, or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation insolvency of the Account Debtor thereunderhas been received by Lender or Borrower or such Guarantor; (viii) the Account is an Account for which Lender believes that the validity, enforceability or collection of the Account is not invalid or otherwise impaired; (ix) the Account Debtor is not a Subsidiary or Affiliate of Borrower or such Guarantor; (x) the Account is not an Account of an Account Debtor having its principal place of business or executive office outside the United States, unless the payment of such Account is guaranteed by an irrevocable letter of credit satisfactory to Lender or by credit insurance, satisfactory to Lender; and (xi) the Account meets such other reasonable specifications and requirements which may from time to time be established by Lender. Notwithstanding anything to the contrary herein, for purposes of determining the aggregate amount of Eligible Accounts, the value ascribed to those Designated Accounts which are otherwise deemed Eligible Accounts shall not exceed five percent (5%) of aggregate Eligible Accounts. Eligible Inventory - Any and all Inventory of Borrower and each Guarantor located at Borrower's places of business shown on Schedule 5.2 attached hereto and made part hereof (and for which location Lender has received a landlord, warehouse or mortgagee waiver as determined by, and in form and substance satisfactory to, Lender), which (i) is not subject to any offsetLien (other than Liens granted under this Agreement and Permitted Liens, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; if applicable); (gii) it is not slow moving, damaged, obsolete or unmerchantable; (iii) is not Inventory held on consignment; (iv) is not Inventory in-transit unless such Inventory (A) is in transit to one of Borrower's and such Guarantor’s places of business shown on Schedule 5.2, (B) is owned by Borrower or such Guarantor, as the case may be, (C) is insured to the full value thereof, and (D) is subject to any sale negotiable bills of accountslading endorsed to, any rights or non-negotiable bills of offsetlading issued in the name of Lender; and (v) meets such other reasonable specifications and requirements which may from time to time be established by Lender. Notwithstanding anything to the contrary herein, assignment, lien or security interest whatsoever other than Inventory in-transit to Lender, and the subordinate security interest Borrower from locations outside of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America shall be deemed Eligible Inventory as long as the Borrower has taken title to such Inventory and has provided satisfactory evidence thereto to the Lender, such Inventory has been insured to the full value thereof on terms and conditions reasonably satisfactory to the Lender and the Lender has been named loss payee with respect to such insurance. Environmental Laws - Any and all Federal, foreign, state, local or Canadamunicipal laws, (ii) is not organized under the laws rules, orders, regulations, statutes, ordinances, codes, decrees and any and all common law requirements, rules and bases of liability regulating, relating to or imposing liability or standards of conduct concerning pollution, protection of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcyenvironment, or the commencement impact of any proceeding under any bankruptcy pollutants, contaminants or insolvency laws by toxic or against the Account Debtor; (k) it is not an account billed in advance, payable hazardous substances on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, human health or the State of Indianaenvironment, Borrower has filed a Notice of Business Activities Report as now or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is may at any time an Eligible Accounthereafter be in effect from time to time. ERISA - The Employee Retirement Income Security Act of 1974, but which subsequently fails as the same may be in effect, from time to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Accounttime.

Eligible Accounts. Upon Borrower’s delivery to Lender of a Borrowing Base Certificate, Lender The Agent shall determinehave the sole right, in its reasonable discretion, to determine which Accounts listed thereon are “eligible ("Eligible Accounts”"). In making this determinationaddition, Lender will consider without limiting the Agent's discretion, unless otherwise agreed by the Agent in writing, the following requirements: Accounts are not Eligible Accounts: (a) The Account is not owing Accounts which remain unpaid more than ninety (90) days after from the invoice date of based upon the original invoice or other writing evidencing such Account; end-of-the-month aging; (b) it is not all Accounts owing by an a single Account Debtor who has failed to pay twenty-five Debtor, including currently scheduled Accounts, if fifty percent (2550%) or more of the aggregate amount of its Accounts balance owing by such Account Debtor to the Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; is ineligible for any reason; (c) it arises from the sale of goods and such goods have been shipped or delivered Accounts with respect to which the Account Debtor under such Accountis a director, officer, employee, Subsidiary or Affiliate of the Borrower; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered Accounts with respect to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of which the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state department, agency or political subdivision instrumentality thereof, or by any departmentunless the Borrower assigns its right to payment of such Accounts to the Agent pursuant to, agencyand in full compliance with, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, ; (e) Accounts with respect to which the Account Debtor is not a resident of the United States [or its territories]; (f) Accounts in dispute or with any comparable state law, if applicable, and all other necessary steps are taken respect to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an which the Account Debtor for has asserted in writing or either the Borrower or the Agent has reason to believe the Account Debtor is entitled to assert a counterclaim or has asserted in writing or either the Borrower or the Agent has reason to believe the Account Debtor is entitled to assert a right of setoff; (g) Accounts with respect to which Borrower has received the prospect of payment or performance by the Account Debtor is or will be impaired, as determined by the Agent in the exercise of its discretion; (h) Accounts with respect to which the Agent does not have a notice of first and valid fully perfected security interest; (i) the death of Accounts with respect to which the Account Debtor is the subject of bankruptcy or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, a similar insolvency proceeding or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) has made an assignment for the benefit of creditors, the filing of creditors or whose assets have been conveyed to a petition in bankruptcy, receiver or the commencement of any proceeding under any bankruptcy or insolvency laws by or against trustee; (j) Accounts with respect to which the Account Debtor; (k) it 's obligation to pay the Account is not an account billed in advanceconditional upon the Account Debtor's approval or is otherwise subject to any repurchase obligation or return right, payable as with sales made on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress a ▇▇▇▇▇▇▇▇-and-hold, payable at guaranteed sale, sale-and-return, sale on approval or consignment basis; (k) Accounts to the extent that the Account Debtor's indebtedness to the Borrower exceeds a future date in accordance with its terms, subject to a retainage or holdback credit limit determined by the Account Debtor or insured by a surety company; Agent in the Agent's discretion; (1) If Accounts with respect to which the Account Debtor is located in either the State of New Jersey, the State of Minnesota, Tennessee or Indiana unless the State Borrower (i) has received a certificate of Indianaauthority to do business, Borrower and is in good standing, in such state, or (ii) has filed a Notice of Business Activities Report (or other comparable report required report) with the applicable proper authorities of such state authority for the then current year; ; (m) it is Accounts which arise out of sales not owing by any made in the ordinary course of the Borrower's business; (n) Accounts with respect to which the Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified has returned to the Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) all or more any portion of the Inventory the sale of which gave rise to such Accounts; and (o) Accounts with respect to which any document or agreement executed or delivered in connection therewith, or any procedure used in connection with any such document or agreement, fails in any material respect to comply with the requirements of applicable law, or with respect to which any representation or warranty contained in this Agreement is untrue. If the Borrower determines that a previously scheduled Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease ceases to be an Eligible AccountAccount under any of the above described criteria, the Borrower shall notify the Agent thereof at the earliest reasonable opportunity.

Eligible Accounts. Upon Borrower’s delivery to Lender of a Borrowing Base Certificate, Lender The Agent shall determinehave the right, in its the exercise of the Agent’s reasonable discretion, which to determine whether Accounts listed thereon are eligible for inclusion in the Borrowing Base at any particular time (such eligible accounts being referred to as “Eligible Accounts”). In making this determinationWithout limiting the Agent’s right to determine that Accounts do not constitute Eligible Accounts, Lender will consider the following requirements: Accounts shall not be Eligible Accounts: (a) The Account is not owing more than ninety all Accounts which are at that time unpaid for a period exceeding sixty (9060) days after the original invoice due date of the original invoice or other writing evidencing such Account; related thereto; (b) it is not all Accounts owing by an Account Debtor who has failed to pay twenty-five if more than ten percent (2510%) or more of the aggregate amount of its Accounts owing to Borrower within ninety by such Account Debtor are at that time unpaid for a period exceeding sixty (9060) days after the invoice due date of the respective invoices or other writings evidencing such Accounts; original invoice related thereto; (c) it arises those Accounts, except Accounts owing from the sale Account Debtors listed on Exhibit 3A, of goods and such goods have been shipped or delivered to an Account Debtor, the aggregate face amount of which is in excess of five percent (5%) of the aggregate face amount of all other Eligible Accounts of all other Account Debtor under such AccountDebtors; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not those Accounts owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in from the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate agency or other instrumentality of any of the foregoing, thereof unless all necessary steps are taken to comply Borrower shall have complied with the Federal Assignment of Claims Act to the satisfaction of 1940, as amended, or the Agent; (e) Accounts which arise out of transactions with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. Affiliates; (jf) it is not owing by Accounts of an Account Debtor for that is located outside the United States, unless such Accounts are covered by a letter of credit issued or confirmed by a bank acceptable to the Agent or are covered by foreign credit insurance acceptable to the Agent; (g) Accounts which Borrower has received a notice of (i) the death of the Account Debtor are or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, may be subject to a retainage rights of setoff or holdback counterclaim by the Account Debtor (to the extent of the amount of such setoff or insured by counterclaim); (h) Accounts in which the Agent does not, for any reason, have a surety company; first priority perfected security interest; and (1i) If Accounts which in the Account Debtor is located in either the State Agent’s opinion may be subject to liens or conflicting claims of New Jerseyownership, the State of Minnesota, whether such liens or the State of Indiana, Borrower has filed a Notice of Business Activities Report conflicting claims are asserted or comparable report with the applicable state authority for the then current year; (m) it is not owing could be asserted by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible AccountPerson.

Eligible Accounts. Upon Borrower’s delivery to Lender of a Borrowing Base Certificate, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination" shall mean all Accounts of each of the Borrowers other than the following: (i) except as provided in SUBSECTION 3.2(VI), Lender will consider the following requirements: (a) The Account is not owing more than Accounts which remain unpaid as of ninety (90) days after the date of the original invoice or other writing evidencing such Account; with respect thereto; (bii) it is not all Accounts owing by an a single Account Debtor who has failed to pay twenty-five Debtor, including a currently scheduled Account, if fifty percent (2550%) or more of the aggregate amount of its Accounts balance owing to Borrower within ninety (90) days after the date by such Account Debtor is ineligible by reason of the respective invoices or other writings evidencing such Accounts; criterion set forth in clause (ci) it arises from the sale of goods and such goods have been shipped or delivered this subsection 3.2; (iii) Accounts with respect to which the Account Debtor under such Accountis an Affiliate of any Borrower or a director, officer or employee of any Borrower or its Affiliates; or it arises from services rendered and such services have been performed; (div) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered Accounts with respect to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of which the Account Debtor thereunder, and is not subject a Governmental Authority or prime contractor thereof unless such Borrower has complied in a manner satisfactory to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply Agent with the Federal Assignment of Claims Act of 1940, as amended, or similar law or statute of the relevant state, province, municipality or other jurisdiction and any amendments thereto, relative to the assignment of such Accounts; (v) Accounts with any comparable state law, if applicable, and all other necessary steps are taken respect to perfect Lender’s security interest and collection rights in such Account. (j) it which the Account Debtor is not owing by an a resident of the United States unless the Account is payable in United States dollars and (A) the Account Debtor for which has supplied such Borrower has received with an irrevocable letter of credit, issued by a notice financial institution satisfactory to the Required Lenders in an amount sufficient to cover such Account and in form and substance satisfactory to the Required Lenders and without right of setoff or (iB) the death of Agent in its reasonable discretion has approved in writing such Account Debtor; (vi) Prebilled Accounts and other Accounts arising with respect to goods which have not been shipped and delivered to and accepted as satisfactory by the Account Debtor or any partner of arising with respect to services which have not been fully performed and accepted as satisfactory by the Account Debtor, ; (iivii) Accounts for which the dissolution, liquidation, termination prospect of existence, insolvency payment in full or business failure performance in a timely manner by the Account Debtor is or is likely to become impaired as determined by the Agent in the reasonable exercise of its discretion; (viii) Accounts which are not invoiced (and dated as of the date of such invoice) and sent to the Account Debtor within thirty (30) days after delivery of the underlying goods to or performance of the underlying services for the Account Debtor; (ix) Accounts with respect to which the Agent, (iii) the appointment of a receiver for any part on behalf of the property Lenders, does not have a first and valid fully perfected Lien free and clear of any other Lien whatsoever; (x) Accounts with respect to which the Account Debtor, Debtor is the subject of bankruptcy or (iv) a similar insolvency proceeding or has made an assignment for the benefit of creditors, the filing of creditors or whose assets have been conveyed to a petition in bankruptcy, receiver or the commencement of any proceeding under any bankruptcy or insolvency laws by or against trustee; (xi) Accounts with respect to which the Account Debtor; (k) it 's obligation to pay the Account is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, conditional upon the Account Debtor's approval or is otherwise subject to any repurchase obligation or return right, as with sales made on a retainage guaranteed sale, sale-or-return, demonstration, sale on approval or holdback other terms by reason of which the payment by the Account Debtor is or insured may be conditional (except with respect to Accounts in connection with which Account Debtors are entitled to return Inventory solely on the basis of the quality of such Inventory) or consignment basis; (xii) Accounts to the extent that the Account Debtor's indebtedness to the Borrowers exceeds a credit limit determined by a surety company; the Agent in the Agent's discretion following prior written notice of such credit limit from the Agent to the Borrower Representative; (1xiii) If Accounts with respect to which any disclosure is required in accordance with SUBSECTION 3.3; (xiv) contra Accounts to the extent of the amount of the accounts payable owed by the Borrowers to the Account Debtor; (xv) Accounts with respect to which the Account Debtor is located in any state denying creditors access to its courts in the absence of a Notice of Business Activities Report or other similar filing unless such Borrower has either the State of New Jersey, the State of Minnesota, qualified as a foreign corporation authorized to transact business in such state or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report similar filing with the applicable Governmental Authority in such state authority for the then current year; ; (mxvi) it Accounts evidenced by Chattel Paper or any Instrument of any kind, to the extent possession of such Chattel Paper or Instrument is not owing by any Account Debtor whose obligations Lendergranted to the Agent, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more for the benefit of the Lenders; and (xvii) Accounts which the Agent determines in good faith to be unacceptable. In the event that a previously scheduled Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease ceases to be an Eligible AccountAccount under the above described criteria (other than any determination made by the Agent), the Borrower Representative shall notify the Agent thereof as soon as practicable.

Eligible Accounts. Upon Borrower’s delivery to Lender All of a the Accounts owned by Borrower and reflected in the most recent Borrowing Base CertificateCertificate delivered by Borrower to Agent shall be "Eligible Accounts" for purposes of this Agreement, Lender except any Account to which any of the exclusionary criteria set forth below applies. Agent shall determinehave the right to establish, modify or eliminate Reserves against Eligible Accounts from time to time in its reasonable credit judgment. In addition, Agent reserves the right, at any time and from time to time after the Closing Date, to adjust any of the criteria set forth below, to establish new criteria and to adjust advance rates with respect to Eligible Accounts, in its reasonable discretion, which credit judgment. Eligible Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider the following requirementsshall not include any Account: (a) The Account is not owing more than ninety (90) days after the date of the original invoice or other writing evidencing such Account; (b) it is not owing by an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to if the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date subject of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized petition under the laws of the United States of America, Bankruptcy Code or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) made an assignment for the benefit of creditors; (b) if the Account has been previously discharged under the Bankruptcy Code; (c) if the Account Debtor is deceased; (d) if the Account has been satisfied; (e) if the Account Debtor has been released from liability with respect to the Account; (f) if the Account is evidenced by a judgment; (g) if any suit or claim by or on behalf of the Account Debtor is pending or threatened regarding such Account; (h) if the Face Amount of such Account is less than $300 or more than $8,000; (i) that is not a legal, valid and binding obligation of the Account Debtor, subject only to statute of limitations' defenses; (j) if any defense, counterclaim, setoff or dispute has been asserted in writing as to such Account; (k) that is not a true and correct statement of bona fide indebtedness incurred in the amount of the Account for merchandise sold or services rendered to or money borrowed by, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the applicable Account Debtor; (kl) it (i) good and marketable title to which is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, owned by Borrower or (ii) that is subject to a retainage any right, claim, security interest or holdback by the Account Debtor other interest of any other Person (including obligations to collection agencies or insured by a surety company; (1) If the Account Debtor is located attorneys), other than Liens in either the State favor of New JerseyAgent, the State on behalf of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current yearitself and Lenders; (m) it that is not owing a Converted Account; or (n) except for the initial portfolio purchased by any Account Debtor whose obligations LenderBorrower on the Closing Date, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) that was owned by Servicer for 120 days or more prior to being purchased by Borrower, unless Agent shall otherwise agree. Not more than 50% of the all Eligible Accounts be due and owing from any one Account Debtor at any time, then shall consist of Chattel Paper or Instruments not in the excess possession of said twenty percent (20%) of such Borrower. Eligible Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy included in the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails Borrowing Base only up to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Accounttheir respective Face Amounts.

Eligible Accounts. Upon Borrower’s delivery to Lender of a Borrowing Base Certificate, Lender The Agent shall determinehave the sole right, in its reasonable discretion, to determine which Accounts listed thereon are “eligible ("Eligible Accounts”"). In making this determinationaddition, Lender will consider without limiting the Agent's discretion, unless otherwise agreed by the Agent in writing, the following requirements: Accounts are not Eligible Accounts: (a) The Account is not owing Accounts which remain unpaid more than ninety (90) days after from the invoice date of based upon the original invoice or other writing evidencing such Account; end-of-the-month aging; (b) it is not all Accounts owing by an a single Account Debtor who has failed to pay twenty-five Debtor, including currently scheduled Accounts, if fifty percent (2550%) or more of the aggregate amount of its Accounts balance owing by such Account Debtor to the Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; is ineligible for any reason; (c) it arises from the sale of goods and such goods have been shipped or delivered Accounts with respect to which the Account Debtor under such Accountis a director, officer, employee, Subsidiary or Affiliate of the Borrower; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered Accounts with respect to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of which the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state department, agency or political subdivision instrumentality thereof, or by any departmentunless the Borrower assigns its right to payment of such Accounts to the Agent pursuant to, agencyand in full compliance with, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, ; (e) Accounts with respect to which the Account Debtor is not a resident of the continental United States; (f) Accounts in dispute or with any comparable state law, if applicable, and all other necessary steps are taken respect to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an which the Account Debtor for has asserted in writing or either the Borrower or the Agent has reason to believe the Account Debtor is entitled to assert a counterclaim or has asserted in writing or either the Borrower or the Agent has reason to believe the Account Debtor is entitled to assert a right of setoff; (g) Accounts with respect to which Borrower has received the prospect of payment or performance by the Account Debtor is or will be impaired, as determined by the Agent in the exercise of its discretion; (h) Accounts with respect to which the Agent does not have a notice of first and valid fully perfected security interest; (i) the death of Accounts with respect to which the Account Debtor is the subject of bankruptcy or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, a similar insolvency proceeding or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) has made an assignment for the benefit of creditors, the filing of creditors or whose assets have been conveyed to a petition in bankruptcy, receiver or the commencement of any proceeding under any bankruptcy or insolvency laws by or against trustee; (j) Accounts with respect to which the Account Debtor; (k) it 's obligation to pay the Account is not an account billed in advanceconditional upon the Account Debtor's approval or is otherwise subject to any repurchase obligation or return right, payable as with sales made on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress a ▇▇▇▇▇▇▇▇-and-hold, payable at guaranteed sale, sale- and-return, sale on approval or consignment basis; (k) Accounts to the extent that the Account Debtor's indebtedness to the Borrower exceeds a future date in accordance with its terms, subject to a retainage or holdback credit limit determined by the Account Debtor or insured by a surety company; Agent in the Agent's discretion; (1) If Accounts with respect to which the Account Debtor is located in either the State of New Jersey, the State of Minnesota, Tennessee or Indiana unless the State Borrower (i) has received a certificate of Indianaauthority to do business, Borrower and is in good standing, in such state, or (ii) has filed a Notice of Business Activities Report (or other comparable report required report) with the applicable proper authorities of such state authority for the then current year; ; (m) it is Accounts which arise out of sales not owing by any made in the ordinary course of the Borrower's business; (n) Accounts with respect to which the Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified has returned to the Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) all or more any portion of the Inventory the sale of which gave rise to such Accounts; and (o) Accounts with respect to which any document or agreement executed or delivered in connection therewith, or any procedure used in connection with any such document or agreement, fails in any material respect to comply with the requirements of applicable law, or with respect to which any representation or warranty contained in this Agreement is untrue. If the Borrower determines that a previously scheduled Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease ceases to be an Eligible AccountAccount under any of the above described criteria, the Borrower shall notify the Agent thereof at the earliest reasonable opportunity.

Eligible Accounts. Upon Borrower’s delivery to Lender of a Borrowing Base Certificate, Lender Agent shall determinehave the sole right, in its reasonable discretion exercised in Good Faith, to determine which Accounts are eligible (the "Eligible Accounts"). Without limiting Agent's discretion, which the following Accounts listed thereon are “shall not be Eligible Accounts”. In making this determination, Lender will consider the following requirements: : (ai) The Account is not owing more than ninety Accounts which remain unpaid one hundred twenty (90120) days after the original date of the original invoice or other writing evidencing such Account; applicable invoice; (bii) it is not all Accounts owing by an a single Account Debtor who has failed to pay twenty-five Debtor, including a currently scheduled Account, if fifty percent (2550%) or more of the aggregate amount of its balance owing by such Account Debtor to a Borrower are not, or would not be, Eligible Accounts owing to Borrower within ninety (90) days after the date as a result of the respective invoices or other writings evidencing such Accounts; application of the provisions of the preceding clause (ci); (iii) it arises from the sale of goods and such goods have been shipped or delivered Accounts with respect to which the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a validdirector, legally enforceable obligation officer, employee, Subsidiary or Affiliate of any Borrower; (iv) Accounts with respect to which the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state department, agency or political subdivision instrumentality thereof, or by unless with respect to any departmentsuch Account, agency, public body corporate or other instrumentality the applicable Borrower has complied to Agent's satisfaction with the provisions of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amendedincluding, or without limitation, executing and delivering to Agent all statements of assignment and/or notification which are in form and substance acceptable to Agent and which are deemed necessary by Agent to effectuate the assignment to Agent of such Accounts; (v) Accounts with any comparable state law, if applicable, and all other necessary steps are taken respect to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner is not a resident of the Account DebtorUnited States or the Alberta, (ii) the dissolutionBritish Columbia, liquidationManitoba, termination Nova Scotia, Ontario, Ottawa or Saskatchewan Provinces of existenceCanada, insolvency or business failure of unless the Account DebtorDebtor has supplied the applicable Borrower with an irrevocable letter of credit, issued by a financial institution satisfactory to Agent, sufficient to cover such Account in form and substance reasonably satisfactory to Agent; (iiivi) the appointment of a receiver for any part of the property of Accounts with respect to which the Account Debtor, Debtor has asserted a counterclaim or has a right of setoff (ivbut only to the extent of such asserted counterclaim or setoff unless the Account Debtor is refusing to pay the remaining amount of such Account or Accounts); (vii) Accounts for which the prospect of payment or performance by the Account Debtor is or may be impaired as determined by Agent in its sole discretion exercised in Good Faith; (viii) Accounts with respect to which Agent does not have a first and valid fully perfected security interest; (ix) Accounts with respect to which the Account Debtor is the subject of bankruptcy or a similar insolvency proceeding or has made an assignment for the benefit of creditors, the filing of creditors or whose assets have been conveyed to a petition in bankruptcy, receiver or the commencement of any proceeding under any bankruptcy or insolvency laws by or against trustee; (x) Accounts with respect to which the Account Debtor; (k) it 's obligation to pay the Account is not an account billed in advanceconditional upon the Account Debtor's approval or is otherwise subject to any repurchase obligation or return right, payable as with sales made on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress a ▇▇▇▇▇▇▇▇-and-hold, payable at a future date in accordance with its termsguaranteed sale, subject sale-or-return, sale on approval or consignment basis; (xi) Accounts to a retainage or holdback by the extent that the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with Debtor's indebtedness to the applicable state authority for the then current year; Borrower exceeds a credit limit determined by Agent in Agent's sole discretion in Good Faith; and (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Account.xii)

Eligible Accounts. Upon Borrower’s delivery to Lender On any date of a determination of the Borrowing Base, all of the Accounts owned by all Loan Parties and reflected in the most recent Borrowing Base Certificate, Lender Certificate delivered by the Lead Borrower to the Collateral Agent and the Administrative Agent shall determine, in its reasonable discretion, which Accounts listed thereon are be “Eligible Accounts”” for the purposes of this Agreement, except any Account to which any of the exclusionary criteria set forth below applies. In addition, the Administrative Agent reserves the right, at any time and from time to time after the Closing Date, to adjust any of the criteria set forth below, to establish new criteria with respect to Eligible Accounts and to adjust the advance rates in its Permitted Discretion, subject to the approval of the Required Lenders in the case of adjustments, new criteria or increases in advance rates which have the effect of making this determination, Lender will consider more credit available than would have been available if the standards in effect on the Closing Date had continued to be in effect: Eligible Accounts shall not include any of the following requirementsAccounts: (ai) The any Account is not owing more than ninety (90) days after in which the date Collateral Agent, on behalf of the original invoice or other writing evidencing such AccountSecured Parties, does not have a first priority (except, to the extent of Liens permitted under Section 6.2(a) hereof) perfected Lien; (bii) it any Account that is not owing owned by a Loan Party; (iii) any Account due from an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it that is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office domiciled in the United States of America or Canada, Canada and (iiif not a natural person) is not organized under the laws of the United States of America, or Canada or any state thereofpolitical subdivision thereof to the extent such Accounts (to the extent all such foreign Accounts exceed $2.0 million in the aggregate) are not backed by a letter of credit or credit insurance to the extent such insurance has been assigned to the Collateral Agent; (iv) any Account that is payable in any currency other than Dollars or, with the establishment of appropriate foreign currency reserves established by Collateral Agent, Canadian Dollars; (v) any Account that does not arise from the sale of goods or under the laws performance of services by such Loan Party in the ordinary course of its business; (vi) any Account that does not comply in all material respects with all applicable legal requirements, including, without limitation, all laws, rules, regulations and orders of any province in CanadaGovernmental Authority; (vii) any Account (A) upon which a Loan Party’s, right to receive payment is contingent upon the fulfillment of any condition whatsoever unless such condition is satisfied or (B) as to which a Loan Party, is not able to bring suit or otherwise enforce its remedies against the Account Debtor through judicial or administrative process, (C) that represents a progress billing consisting of an invoice for goods sold or used or services rendered pursuant to a contract under which the Account Debtor’s obligation to pay that invoice is subject to a Loan Party’s completion of further performance under such contract or is subject to the equitable lien of a surety bond issuer, or (iiiD) is the government of any foreign country Account that arises with respect to goods that are delivered on a ▇▇▇▇-and-hold, cash-on-delivery basis or sovereign stateplaced on consignment, or of any state, province, municipality guaranteed sale or other instrumentality thereofterms by reason of which the payment by the Account Debtor is or may be conditional except that Accounts arising from sales which are on a cash-on-delivery basis (to the extent such cash-on-delivery is in the ordinary course of business) shall not be deemed ineligible pursuant to this Section 2.19(a)(vii) until 14 days after the shipment of the goods relating thereto; (iviii) to the extent that any defense, counterclaim, setoff or dispute is asserted as to such Account, it being understood that the remaining balance of the Account shall be eligible; (ix) any Account that is not a true and correct statement of bona fide indebtedness incurred in the amount of the Account for merchandise sold to or services rendered and accepted by the applicable Account Debtor; (x) any Account with respect to which an invoice or other electronic transmission constituting a request for payment, reasonably acceptable to the Administrative Agent in form and substance, has not been sent on a timely basis to the applicable Account Debtor according to the normal invoicing and timing procedures of the Loan Parties; (xi) any Account that arises from a sale to any director, officer, other employee or Affiliate of a Loan Party, or to any entity (other than portfolio companies owned by Sponsor to the extent such underlying sale is at arms-length) that has any common officer or director with a Loan Party; (xii) any Account that is in default; provided that, without limiting the generality of the foregoing, an Account owing by shall be deemed in default upon the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality occurrence of any of the foregoingfollowing: 1) any Account not paid within the date that is more than 60 days past due according to its original terms of sale; or 2) the Account Debtor obligated upon such Account suspends business, makes a general assignment for the benefit of creditors or fails to pay its debts generally as they come due; or 3) a petition is filed by or against any Account Debtor obligated upon such Account under any bankruptcy law or any other federal, state or foreign (including any provincial) receivership, insolvency relief or other law or laws for the relief of debtors; provided that so long as an order exists permitting payment of trade creditors specifically with respect to such Account Debtor and such Account Debtor has obtained adequate post-petition financing to pay such Accounts, the Accounts of such Account Debtor shall not be deemed ineligible under the provisions of this clause (C) to the extent the order permitting such financing allows the payment of the applicable Account; (xiii) any Account that is the obligation of an Account Debtor (other than an individual) if 50% or more of the dollar amount of all Accounts owing by such Account Debtor are ineligible under the criteria set forth in Section 2.19(a)(xii); (xiv) any Account as to which any of the representations or warranties in the Loan Documents are untrue in any material respect (to the extent such materiality relates to the amount owing on such Account); (xv) to the extent such Account is evidenced by a judgment, Instrument or Chattel Paper and such Instrument or Chattel Papers is not pledged and delivered to the Collateral Agent under the Security Documents; (xvi) any Account on which the Account Debtor is a Governmental Authority, unless all necessary steps are taken the applicable Loan Party has assigned its rights to comply with payment of such Account to the Federal Administrative Agent pursuant to the Assignment of Claims Act of 1940, as amended, or with any comparable state lawin the case of a federal Governmental Authority, and pursuant to Applicable Law, if applicableany, in the case of any other Governmental Authority, and all other necessary steps are taken to perfect Lender’s security interest such assignment has been accepted and collection rights in such Account.acknowledged by the appropriate government officers; and (jxvii) it is not owing by an Any Account Debtor for which Borrower arising on account of a supplier rebate, unless the Collateral Agent has received a notice waiver of (i) offset from the death of supplier in form and substance reasonably satisfactory to the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible AccountCollateral Agent .

Eligible Accounts. Upon Borrower’s 's delivery to Lender Bank of a Borrowing Base CertificateReport, Lender Bank shall determine, in its reasonable discretiondiscretion and in the exercise of good faith, which individual Accounts listed thereon are “Eligible Accounts”. In making this such determination, Lender will consider it is acknowledged by Borrower that the following requirementsAccounts will not be deemed to be Eligible Accounts; provided that nothing contained herein shall be deemed to limit Bank's discretion to consideration of the following factors: (a) The Account is not owing Accounts with a due date of thirty (30) days from the invoice date and which remain unpaid more than ninety (90) days after the date of the original invoice or other writing evidencing such Accountdate; (b) it is not Accounts owing by an a single Account Debtor who has failed or its Affiliate (if such Affiliate is known by Borrower to pay be an affiliate of such Account Debtor), including a currently scheduled Account, if twenty-five percent (25%) or more of the aggregate amount of balance owing by said Account Debtor or its Affiliate upon Accounts owing to Borrower within remains unpaid more than ninety (90) days after the date of the respective invoices or other writings evidencing such Accountsinvoice date; (c) it arises from the sale of goods and such goods have been shipped or delivered Accounts with respect to which the Account Debtor under such Account; is a director, officer, employee or it arises from services rendered and such services have been performedagent of Borrower or is a Parent, a Subsidiary or an Affiliate; (d) it is evidenced Accounts with respect to which payment by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor is or some other evidence may be conditional and Accounts commonly known as ▇▇▇▇ and hold or Accounts of billing acceptable to Lendera similar or like arrangement; (e) it Accounts with respect to which the Account Debtor is not evidenced a resident or citizen of or otherwise located in the continental United States of America or Canada (other than Quebec), or with respect to which the Account Debtor is not subject to service of process in the continental United States of America unless payment of such Account is secured by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed a letter of credit reasonably acceptable and delivered by Borrower assigned to Lender and is acceptable to LenderBank; (f) it is a valid, legally enforceable obligation of Accounts with respect to which the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, provincecounty, municipality or city, municipal and/or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereofgovernmental body, or by any department, agency, public body corporate agency or other instrumentality thereof unless Borrower assigns its right to payment of any of such Accounts to Bank pursuant to the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amendedamended (31 U.S.C. (S)203, 41 U.S.C. (S)15, 41 C.F.R. (S)(S)1- 30, 700 et seq.), or any similar law or regulation relating to the assignment or pledge of such Accounts; (g) Accounts with respect to which Borrower is or may become liable to the Account Debtor for goods sold or services rendered by such Account Debtor to Borrower unless the Account Debtor executes and delivers a "no-offset" letter in form and substance acceptable to Bank; (h) Accounts with respect to which the goods giving rise thereto have not been shipped and delivered to or have been affirmatively rejected as unsatisfactory by the Account Debtor thereof or with respect to which the services performed giving rise thereto have not been completed and accepted as satisfactory by the Account Debtor thereof; (i) Accounts with respect to which possession and/or control of the goods sold giving rise thereto is held, maintained or retained by Borrower (or by any comparable state law, if applicable, and all other necessary steps are taken agent or custodian of Borrower) for the account of or subject to perfect Lender’s security interest and collection rights in such Account.further and/or future direction from the Account Debtor thereof; (j) it is not owing by an Account Debtor for which Borrower has received Accounts arising from a notice of (i) the death of the Account Debtor "sale on approval" or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency a "sale or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtorreturn"; (k) it is not an account billed Accounts as to which Bank, at any time or times hereafter, determines, in advancegood faith, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage that the prospect of payment or holdback performance by the Account Debtor is or insured by a surety companywill be impaired; (1l) If Accounts with respect to which the Account Debtor thereof is located in either the State of New Jersey, Jersey or the State of Minnesota, or the State of Indiana, unless Borrower has filed filed, as applicable, a Notice of Business Activities Report or comparable report with the applicable state authority New Jersey Division of Taxation for the then current year, or is qualified to transact business and in good standing for the then current year, or a Business Activity Report with the Minnesota Department of Revenue for the then current year, or is otherwise exempt from such reporting requirements under the laws of such state; (m) it Accounts with respect to which Bank's security interest is not entitled to first priority; and (n) Accounts owing by from any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at insolvent or the subject of any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Accountinsolvency or bankruptcy proceedings.

Eligible Accounts. Upon Borrower’s delivery to Lender On any date of a determination of the Borrowing Base, all of the Accounts owned by all Loan Parties (other than Holdings) and reflected in the most recent Borrowing Base CertificateCertificate delivered by the Borrower to the Administrative Agent shall be “Eligible Accounts” for the purposes of this Agreement, Lender shall determineexcept any Account to which any of the exclusionary criteria set forth below applies. In addition, the Administrative Agent reserves the right, at any time and from time to time after the Funding Date, to adjust any of the criteria set forth below, to establish new criteria with respect to Eligible Accounts and to adjust the advance rates, in each case, in its reasonable discretionPermitted Discretion, subject to the approval of all Lenders in the case of adjustments, new criteria or increases in advance rates which have the effect of making more credit available than would have been available if the standards in effect on the Funding Date had continued to be in effect. Eligible Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider shall not include any of the following requirementsAccounts: (ai) The any Account is not owing more than ninety (90) days after in which the date Administrative Agent, on behalf of the original invoice or other writing evidencing such AccountSecured Parties, does not have a first priority (except to the extent of Liens permitted under Section 7.01(c) hereof) perfected Lien; (bii) it any Account that is not owing owned by a Loan Party; (iii) any Account due from an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it that is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office domiciled in the United States of America or Canada, Canada and (iiif not a natural person) is not organized under the laws of the United States of America, or Canada or any state thereofpolitical subdivision thereof to the extent all such Accounts exceed $2,000,000 (or its equivalent in Canadian Dollars) in the aggregate; (iv) any Account that is payable in any currency other than Dollars or Canadian Dollars; (v) any Account that does not arise from the sale of goods or the performance of services by such Loan Party in the ordinary course of its business; (vi) any Account that does not comply in all material respects with all applicable legal requirements, or under the laws including, without limitation, all laws, rules, regulations and orders of any province in CanadaGovernmental Authority; (vii) any Account (A) as to which a Loan Party’s right to receive payment is contingent upon the fulfillment of any condition whatsoever unless such condition is satisfied, (B) as to which a Loan Party is not able to bring suit or otherwise enforce its remedies against the Account Debtor through judicial or administrative process, (C) that represents a progress billing consisting of an invoice for goods sold or used or services rendered pursuant to a contract under which the Account Debtor’s obligation to pay that invoice is subject to a Loan Party’s completion of further performance under such contract or is subject to the equitable lien of a surety bond issuer, or (iiiD) is the government of any foreign country that arises with respect to goods that are delivered on a ▇▇▇▇-and-hold, cash-on-delivery basis or sovereign stateplaced on consignment, or of any state, province, municipality guaranteed sale or other instrumentality thereofterms by reason of which the payment by the Account Debtor is or may be conditional except that Accounts arising from sales which are on a cash-on-delivery basis (to the extent such cash-on-delivery is in the ordinary course of business) shall not be deemed ineligible pursuant to this Section 2.14(a)(vii) until 14 days after the shipment of the goods relating thereto; (iviii) to the extent that any defense, counterclaim or dispute arises, or the Account is, or is reasonably likely to become, subject to any right of set-off by the Account Debtor, to the extent of the amount of such set-off, it being understood that the remaining balance of the Account shall be eligible; (ix) any Account that is not a true and correct statement of bona fide indebtedness incurred in the amount of the Account for merchandise sold to or services rendered and accepted by the applicable Account Debtor; (x) any Account with respect to which an invoice or other electronic transmission constituting a request for payment, reasonably acceptable to the Administrative Agent in form and substance, has not been sent on a timely basis to the applicable Account Debtor according to the normal invoicing and timing procedures of the Loan Parties; (xi) any Account that arises from a sale to any director, officer, other employee or Affiliate of a Loan Party, or to any entity (other than portfolio companies owned by any Back Stop Party to the extent such underlying sale is at arms-length) that has any common officer or director with a Loan Party; (xii) any Account that is in default; provided that, without limiting the generality of the foregoing, an Account owing by shall be deemed in default at any time upon the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality occurrence of any of the foregoingfollowing: (A) such Account is not paid and is more than 60 days past due according to its original terms of sale; or (B) the Account Debtor obligated upon such Account suspends business, makes a general assignment for the benefit of creditors, fails to pay its debts generally as they come due, or is classified by the Borrower and its Subsidiaries as “cash only, bad check,” as determined by the Borrower and its Subsidiaries in the ordinary course of business consistent with past-practice; (C) a petition is filed by or against any Account Debtor obligated upon such Account under any bankruptcy law or any other federal, state or foreign (including any provincial) receivership, insolvency relief or other law or laws for the relief of debtors; provided that so long as an order exists permitting payment of trade creditors specifically with respect to such Account Debtor and such Account Debtor has obtained adequate post-petition financing to pay such Accounts, the Accounts of such Account Debtor shall not be deemed ineligible under the provisions of this clause (C) to the extent the order permitting such financing allows the payment of the applicable Account; (D) the Borrower or its Subsidiaries grant extended payment terms to the Account Debtor for such Account to the extent all such Accounts exceed $7,000,000 in the aggregate; or (E) the Account is classified by the Borrower or its Subsidiaries as “high risk” as determined by the Borrower and its Subsidiaries in the ordinary course of business consistent with past practice; (xiii) any Account that is the obligation of an Account Debtor (other than an individual) if 50% or more of the dollar amount of all Accounts owing by such Account Debtor are ineligible under the criteria set forth in clause (xii) above; (xiv) any Account as to which any of the representations or warranties in the Loan Documents are untrue in any material respect (to the extent such materiality relates to the amount owing on such Account); (xv) any Account which is evidenced by a judgment, Instrument or Chattel Paper and such Instrument or Chattel Paper is not pledged and delivered to the Administrative Agent under the Security Documents; (xvi) any Account on which the Account Debtor is a Governmental Authority, unless all necessary steps are taken the applicable Loan Party has assigned its rights to comply with payment of such Account to the Federal Administrative Agent pursuant to the Assignment of Claims Act of 1940, as amended, or with any comparable state lawin the case of a federal Governmental Authority, and pursuant to Applicable Law, if applicableany, in the case of any other Governmental Authority, and all other necessary steps are taken to perfect Lender’s security interest such assignment has been accepted and collection rights in such Account.acknowledged by the appropriate government officers; and (jxvii) it is not owing by an any Account Debtor for which arising on account of a supplier rebate, unless the Borrower has received a notice waiver of (i) offset from the death of supplier in form and substance reasonably satisfactory to the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible AccountAdministrative Agent.

Eligible Accounts. Upon Borrower’s delivery to Lender of a Borrowing Base CertificateFunds in the Distribution Account and in the Reserve Account may be invested in Eligible Investments by the Trustee for its own account. The Distribution Account and Reserve Account shall be held separate and apart from and shall not be commingled with any other monies including, Lender shall determinewithout limitation, in its reasonable discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider the following requirements: (a) The Account is not owing more than ninety (90) days after the date other monies of the original invoice or other writing evidencing such Account; (b) it is not owing Paying Agent held under this Agreement. Funds in the Distribution Account and in the Reserve Account may be invested and, if invested, shall be invested by, and at the risk of, the Trustee in Eligible Investments selected by an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoiceTrustee which shall mature, dated unless payable on demand, not later than such time on the date Distribution Date which will allow the Trustee to make withdrawals from the Distribution Account under Section 5.3(b), and any such Eligible Investment shall not be sold or disposed of shipment or performanceprior to its maturity unless payable on demand. All such Eligible Investments shall be made in the name of "▇▇▇▇▇ Fargo Bank Minnesota, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any noteN.A., trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation as Trustee for the Holders of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ Capital I Inc., payable at a future date in accordance with its termsCommercial Mortgage Pass-Through Certificates, Series 2002-HQ and the holder of any related B Note as their interests may appear." None of the Depositor, the Mortgagors, the Special Servicers, the Master Servicer or the Primary Servicer shall be liable for any loss incurred on such Eligible Investments. An amount equal to all income and gain realized from any such investment shall be paid to the Trustee as additional compensation and shall be subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is withdrawal at any time an Eligible from time to time. The amount of any losses incurred in respect of any such investments shall be for the account of the Trustee which shall deposit the amount of such loss (to the extent not offset by income from other investments) in the Distribution Account or the Reserve Account, but which subsequently fails as the case may be, out of its own funds immediately as realized. If the Trustee deposits in or transfers to meet the Distribution Account or the Reserve Account, as the case may be, any of the foregoing requirements, shall forthwith cease amount not required to be an Eligible deposited therein or transferred thereto, it may at any time withdraw such amount or retransfer such amount from the Distribution Account or the Reserve Account, as the case may be, any provision herein to the contrary notwithstanding.

Eligible Accounts. Upon Borrower’s delivery to Lender of a Borrowing Base Certificate, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider " shall mean all Accounts other than the following requirements: following: (ai) The Account is not owing Accounts which remain unpaid more than ninety (90) days after the date of the original invoice with respect thereto or other writing evidencing such Account; more than sixty (b60) it is not days past the due date specified in the original invoice with respect thereto; (ii) all Accounts owing by an a single Account Debtor who has failed to pay Debtor, including a currently scheduled Account, if twenty-five percent (25%) or more of the aggregate amount balance owing by such Account Debtor is ineligible by reason of its Accounts owing to Borrower within ninety (90) days after the date either of the respective invoices or other writings evidencing such Accounts; criteria set forth in clause (ci) it arises from the sale of goods and such goods have been shipped or delivered this subsection 3.2; (iii) Accounts with respect to which the Account Debtor under is an Affiliate of the Borrower or a director, officer or employee of the Borrower or its Affiliates; provided that any Account owing from the Simp▇▇▇ ▇▇▇er Company which but for the operation of this clause (iii) would constitute an Eligible Account, shall nevertheless constitute an "Eligible Account" to the extent, and only to the extent, the amount of such AccountEligible Account plus all other Eligible Accounts owing by Simp▇▇▇ ▇▇▇er Company exceeds all amounts owing from the Borrower or Guarantor to the Simp▇▇▇ ▇▇▇er Company (other than long-term obligations with respect to the preferred stock owned by the Seller); or it arises from services rendered and such services have been performed; (div) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered Accounts with respect to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of which the Account Debtor thereunder, and is not subject a Governmental Authority or prime contractor thereof unless the Borrower has complied in a manner satisfactory to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply Agent with the Federal Assignment of Claims Act of 1940, as amended, or similar law or statute of the relevant state, province, municipality or other jurisdiction and any amendments thereto, relative to the assignment of such Accounts; (v) Accounts with any comparable state law, if applicable, and all other necessary steps are taken respect to perfect Lender’s security interest and collection rights in such Account. (j) it which the Account Debtor is not owing by an a resident of the United States unless (A) the Account Debtor for which has supplied the Borrower has received with an irrevocable letter of credit, issued by a notice of financial institution satisfactory to the Required Lenders (with financial institutions meeting the criteria set forth in clause (i) of the death definition of "Cash Equivalents" contained herein being deemed acceptable for purposes of providing such a letter of credit), sufficient to cover such Account in form and substance satisfactory to the Required Lenders and without right of setoff and the Account is payable in full in United States dollars or (B) deemed acceptable by the Agent in its sole discretion; (vi) Accounts arising with respect to goods which have not been shipped and delivered to and accepted as satisfactory by the Account Debtor or any partner of arising with respect to services which have not been fully performed and accepted as satisfactory by the Account Debtor, ; (iivii) Accounts for which the dissolution, liquidation, termination prospect of existence, insolvency payment in full or business failure performance in a timely manner by the Account Debtor is or is likely to become impaired in the reasonable credit judgment of the Agent; (viii) Accounts which are not invoiced (and dated as of the date of such invoice) and sent to the Account Debtor within five (5) days after delivery of the underlying goods to or performance of the underlying services for the Account Debtor; (ix) Accounts with respect to which the Agent, (iii) the appointment of a receiver for any part on behalf of the property Lenders, does not have a first and valid fully perfected Lien free and clear of any other Lien whatsoever; (x) Accounts with respect to which the Account Debtor, Debtor is the subject of bankruptcy or (iv) a similar insolvency proceeding or has made an assignment for the benefit of creditors, the filing of creditors or whose assets have been conveyed to a petition in bankruptcy, receiver or the commencement of any proceeding under any bankruptcy or insolvency laws by or against trustee; (xi) Accounts with respect to which the Account Debtor; (k) it 's obligation to pay the Account 50 59 is not an account billed in advanceconditional upon the Account Debtor's approval or is otherwise subject to any repurchase obligation or return right, payable as with sales made on deliverya guaranteed sale, for consigned goods, for guaranteed sales, for unbilled sales, for progress bill-▇▇▇▇▇▇▇▇-hold, payable at a future date in accordance with its termssale-or-return, subject to a retainage sale on approval or holdback other terms by reason of which the payment by the Account Debtor is or insured may be conditional (except with respect to Accounts in connection with which Account Debtors are entitled to return Inventory solely on the basis of the quality of such Inventory) or consignment basis; (xii) Accounts to the extent that the Account Debtor's indebtedness to the Borrower exceeds a credit limit determined by a surety company; the Agent in the reasonable credit judgment of the Agent following prior written notice of such credit limit from the Agent to the Borrower; (1xiii) If Accounts with respect to which any disclosure is required in accordance with subsection 3.3; (xv) contra Accounts to the extent of the amount of the accounts payable owed by the Borrower to the Account Debtor; (xvi) Accounts with respect to which the Account Debtor is located in any state denying creditors access to its courts in the absence of a Notice of Business Activities Report or other similar filing unless the Borrower has either the State of New Jersey, the State of Minnesota, qualified as a foreign corporation authorized to transact business in such state or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report similar filing with the applicable state authority agency in such state for the then current year; ; (mxvii) it Accounts evidenced by Chattel Paper or any Instrument of any kind, to the extent possession of such Chattel Paper or Instrument is not owing by any Account Debtor whose obligations Lenderdelivered to the Agent, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more for the benefit of the Lenders; and (xviii) Accounts which the Agent determines in good faith to be unacceptable. In the event that a previously scheduled Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease ceases to be an Eligible AccountAccount under the above described criteria, the Borrower shall notify the Agent thereof.

Eligible Accounts. Upon Borrower’s delivery to Lender of a Borrowing Base Certificate, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider " shall mean all Accounts other than the following requirements: following: (ai) The Account Accounts for which no due date is not owing more than specified which remain unpaid as of ninety (90) days after the original date of the original applicable invoice or other writing evidencing such Account; or, if a due date is specified, which remains unpaid as of thirty (b) it is not owing by an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (9030) days after the due date but in no event more than one-hundred twenty (120) days following the original date of the respective invoices or other writings evidencing applicable invoice; (ii) all Accounts owing by a single Account Debtor, including a currently scheduled Account, if more than 25% of the balance owing by such Accounts; Account Debtor is ineligible by reason of the criteria set forth in clause (ci) it arises from the sale of goods and such goods have been shipped or delivered above; (iii) Accounts with respect to which the Account Debtor under such Accountis an Affiliate of the Company or a director, officer or employee of any Borrower or its Affiliates (PROVIDED, HOWEVER, that for purposes of this subsection 3.2 "Affiliate" shall not be deemed to include any Person controlled by Primus, Morgenthaler, Foundation Partners Fund, Mesirow Capital Partners VI, Tampsco Enterprises, Inc., Adle▇ ▇▇▇agement or Will▇▇▇ ▇▇▇▇▇ ▇▇▇tners); or it arises from services rendered and such services have been performed; (div) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered Accounts with respect to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of which the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is any department, agency or instrumentality thereof unless filings in accordance with the government Assignment of any foreign country or sovereign stateClaims Act, the Financial Administration Act of Canada, or of any stateother applicable statutes governing security interests thereon have been completed and filed in a manner satisfactory to the Agent, province, municipality or other instrumentality thereof; (iv) it Accounts with respect to which the Account Debtor is not an Account owing by a resident of the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of Canada unless (A) the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an Account Debtor for has supplied the applicable Borrower with an irrevocable letter of credit, issued by a financial institution satisfactory to the Agent, sufficient to cover such Account in form and substance acceptable to the Agent and without right of setoff or (B) such Account Debtor is deemed to be an acceptable credit risk by the Agent in its reasonable discretion; (vi) Accounts arising with respect to goods which Borrower has received a notice of (i) the death of have not been shipped and delivered to and accepted as satisfactory by the Account Debtor or any partner of arising with respect to services which have not been fully performed and accepted as satisfactory by the Account Debtor, ; (iivii) Accounts for which the dissolution, liquidation, termination prospect of existence, insolvency payment in full or business failure performance in a timely manner by the Account Debtor is or is likely to become impaired as determined by the Agent in the reasonable exercise of its discretion; (viii) Accounts which are not invoiced (and dated as of the date of such invoice) and sent to the Account Debtor within five (5) days after delivery of the underlying goods to or performance of the underlying services for the Account Debtor, ; (iiiix) Accounts with respect to which the appointment of Agent does not have a receiver for any part of the property of first and valid fully perfected security interest; (x) Accounts with respect to which the Account Debtor, Debtor is the subject of bankruptcy or (iv) a similar insolvency proceeding or has made an assignment for the benefit of creditors, the filing of creditors or whose assets have been conveyed to a petition in bankruptcy, receiver or the commencement of any proceeding under any bankruptcy or insolvency laws by or against trustee; (xi) Accounts with respect to which the Account Debtor; (k) it 's obligation to pay the Account is not an account billed in advanceconditional upon the Account Debtor's approval or is otherwise subject to any repurchase obligation or return right, payable as with sales made on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress a bill-▇▇▇▇▇▇▇▇-hold, payable at guaranteed sale, sale-and-return, sale on approval (except with respect to Accounts in connection with which Account Debtors are entitled to return Inventory solely on the basis of the quality of such Inventory) or consignment basis; (xii) Accounts to the extent that the Account Debtor's indebtedness to the applicable Borrower exceeds a future date credit limit determined by the Agent in the Agent's reasonable discretion following reasonable prior written notice to such Borrower; and (xiii) Accounts with respect to which any disclosure is required in the applicable Accounts Trial Balance in accordance with its termssubsection 3.3 below; PROVIDED, subject HOWEVER, that with respect to a retainage or holdback Accounts excluded by virtue of subsection 3.3(v) below, if the disputed portion of such Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty less than ten percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (2010%) of the total amount due under such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails then such Account shall be excluded only to meet any the extent of the foregoing requirementsamount of the setoff, shall forthwith cease counterclaim or dispute. In the event that a previously scheduled Eligible Account ceases to be an Eligible AccountAccount under the above described criteria, the Borrowers shall notify the Agent thereof.

Eligible Accounts. Upon Borrower’s delivery The term AELIGIBLE ACCOUNTS@ means those ACCOUNTS which are acceptable to Lender of a Borrowing Base Certificate, Lender shall determine, the LENDER. The criteria for eligibility may be fixed and revised from time to time by the LENDER in its reasonable discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider the following requirements: An ACCOUNT in no event shall be deemed eligible unless: (a) The Account the ACCOUNT arises from goods sold or leased in the ordinary course of business of either or both of the BORROWERS; (b) the delivery of the goods or the performance of the services has been completed; (c) no return, rejection, or repossession has occurred; (d) the goods delivered or the services performed have been finally and unconditionally accepted by the ACCOUNT DEBTOR without dispute, objection, complaint, offset, defense, counterclaim, adjustment or allowance; (e) the ACCOUNT DEBTOR'S obligation to pay the ACCOUNT is not owing subject to any repurchase obligation or return right, as with sales made on a ▇▇▇▇-and-hold, guaranteed sale, sale-and-return, sale on approval (except with respect to ACCOUNTS in connection with which ACCOUNT DEBTORS are entitled to return INVENTORY solely on the basis of the quality of such INVENTORY) or consignment basis; (f) no more than ninety (90) days after have elapsed from the billing or invoice date and no more than sixty (60) days have elapsed from the due date; (g) no prior, contemporaneous, or subsequent assignment, claim, lien, or security interest, other than that of the original invoice LENDER, applies to the ACCOUNT; (h) no bankruptcy or insolvency proceedings or payment moratoriums of any kind apply to the ACCOUNT; (i) the ACCOUNT DEBTOR is not, in the LENDER=S sole opinion, unlikely to pay because of death, incompetency, disappearance, potential bankruptcy, insolvency, damage to or disposition of the goods, default, or any other writing evidencing such Account; reason whatsoever; (bj) it the LENDER has not, by notice to either or both of the BORROWERS, in the LENDER=S sole discretion, deemed the ACCOUNT unsatisfactory for any reason; (k) no bonding company or surety asserts or has the ability to assert any claim based upon the legal doctrine of equitable subrogation, or under any other right to claim a lien into or right to payment of the ACCOUNT; (l) the ACCOUNT does not arise from or pertain to any transaction with any AFFILIATE; (m) the ACCOUNT does not arise from any maintenance or services agreements; (n) the ACCOUNT is not owing payable from any ACCOUNT DEBTOR located outside of the geographic boundaries of the United States of America (unless such ACCOUNT is fully secured by a letter of credit or credit insurance acceptable to the LENDER); (o) the BORROWER is legally empowered to collect the ACCOUNT against the ACCOUNT DEBTOR in the jurisdiction in which the ACCOUNT DEBTOR is located; (p) the ACCOUNT is not payable by an Account Debtor who has failed ACCOUNT DEBTOR with respect to pay which more than twenty-five percent (25%) or more of the aggregate dollar amount of its Accounts owing that ACCOUNT DEBTOR=S RECEIVABLES to Borrower within either or both of the BORROWERS are more than ninety (90) days after due from the date of the respective invoices invoice or other writings evidencing such Accounts; more than sixty (c60) it arises days due from the sale of goods and such goods have been shipped due date; (q) the ACCOUNT does not arise from any contract or delivered to the Account Debtor under such Account; agreement with any federal, state, local or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, foreign government unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and governmental authority is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized an agency or representative thereof and the LENDER has obtained full compliance to its complete satisfaction with all provisions necessary to protect the LENDER=S interests under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act THE ASSIGNMENT OF CLAIMS ACT of 1940, as amended, or with any comparable state law, if applicableand all regulations promulgated thereunder, and all other necessary steps are taken to perfect Lender’s applicable federal procurement laws and regulations; (r) the LENDER has a perfected first priority security interest and collection rights in such Account. therein; (js) it the ACCOUNT is not owing subject to any filed financing statement or other public lien filings by an Account Debtor anyone other than the LENDER, unless any such financing statement is subordinated to the LENDER'S security interests and liens in accordance with written agreements acceptable to the LENDER; and (t) the ACCOUNT does not arise from the sale or lease of any INVENTORY in which any PERSON other than the LENDER claims a security interest or lien, unless such PERSON has expressly agreed to subordinate such security interest or lien to the liens of the LENDER in accordance with written agreements acceptable to the LENDER. An ACCOUNT which otherwise satisfies the LENDER=S criteria for which Borrower has received a notice of eligibility shall also be subject to the following eligibility limitations: (i) if the death ACCOUNT is payable by an ACCOUNT DEBTOR to whom either or both of the Account Debtor or any partner BORROWERS owes money, only the portion of the Account Debtor, ACCOUNT in excess of the amount owed by either or both of the BORROWERS to the ACCOUNT DEBTOR may be eligible; (ii) if the dissolution, liquidation, termination ACCOUNT is due from an ACCOUNT DEBTOR whose ACCOUNTS in the aggregate constitute in excess of existence, insolvency or business failure ten percent (10%) of all of the Account DebtorACCOUNTS of either or both of the BORROWERS, only the portion of the aggregate amount of the ACCOUNTS from that ACCOUNT DEBTOR which does not exceed ten percent (10%) of all of the ACCOUNTS of either or both of the BORROWERS may be eligible; and (iii) to the appointment of a receiver for any part of extent the property of the Account DebtorACCOUNT contains finance charges, delivery charges or (iv) an assignment for the benefit of creditorssales taxes, the filing of a petition in bankruptcysuch finance charges, delivery charges or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts sales taxes shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Account.

Eligible Accounts. Upon Borrower’s delivery As to Lender of each Account represented by the Borrower to be an "Eligible Account" on a Borrowing Base Certificate, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider as of the following requirementsdate of each such Borrowing Base Certificate: (a) The Such Account arose in the ordinary course of the business of Borrower out of either (i) a bona fide sale of Inventory by the Borrower, and in such case such Inventory has in fact been shipped to, and accepted and retained by, the appropriate account debtor or the sale has otherwise been consummated in accordance with such order, or (ii) services performed by the Borrower, under an enforceable contract, and in such case such services have in fact been performed for the appropriate account debtor in accordance with such contract. (b) Such Account represents a legally valid and enforceable claim which is due and owing to the Borrower, by such account debtor and for such amount as is represented by the Borrower, to the Bank on such Borrowing Base Certificate, such Account is due and payable not owing more than thirty (30) days from the delivery of the related Inventory, or the performance of the related services, giving rise to such Account and such Account has not been due for more than ninety (90) days after (from the date of the original invoice or other writing evidencing such Account; (b) it is not owing by an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts;invoice). (c) it arises from The unpaid balance of such Account is as represented by the sale Borrower, and not subject to any defense, counterclaim, setoff, credit, allowance or adjustment by the account debtor because of goods returned, inferior or damaged Inventory or services, or for any other reason, except for customary discounts allowed by Borrower, in the ordinary course of business for prompt payment, and such goods have been shipped there is no agreement between Borrower, the related account debtor and any other person for any rebate, discount, concession or delivered to the Account Debtor under such Account; release of liability, in whole or it arises from services rendered and such services have been performed;in part. (d) it is evidenced by an invoice, dated not later than The transactions leading to the date creation of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender;comply with all applicable state and federal laws and regulations. (e) it The Borrower has granted to the Bank a perfected security interest in such Account (as an item of the Collateral) prior in right to all other persons (other than Permitted Liens), and such Account has not been sold, transferred or otherwise assigned by the Borrower, to any person, other than the Bank. (f) Such Account is not evidenced represented by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless except any such note or other document or instrument previously has as have been endorsed and delivered by Borrower the Borrower, to Lender and is acceptable the Bank on or prior to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense such Account's inclusion on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part;Borrowing Base Certificate. (g) it is The Borrower has not subject received, with respect to any sale of accountssuch Account, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor related account debtor or any partner thereof, nor of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or insolvency, business failure of the Account Debtorfailure, (iii) the appointment of a receiver for any part of the property of the Account Debtorof, or (iv) an assignment for the benefit of creditorscreditors by, or the filing of a petition in bankruptcy, bankruptcy or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor;against, such account debtor. (kh) it The account debtor on such Account is not not: (i) an account billed in advanceaffiliate of the Borrower, (ii) the United States of America or any department, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at agency or instrumentality thereof, (iii) a future date in accordance with its terms, citizen or resident of any jurisdiction other than one of the United States (unless such Foreign Account is subject to a retainage or holdback by guaranty of payment in the Account Debtor or insured form of a letter of credit issued by a surety company;Bank which is acceptable to the Bank) or (1iv) If an account debtor whom the Account Debtor is located Bank has, in either the State exercise of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its such Bank's sole discretion, determined to be (based on such factors as the Bank deems appropriate) an ineligible account debtor and as to which the Bank has notified the Borrower, provided, however, that any such notice shall have notified not apply as to any Account of such account debtor which has been included on a Borrowing Base Certificate by the Borrower are not deemed prior to constitute the giving of such notice by the Bank and which meets each and every other requirement under this Agreement for the denomination of such Account as an "Eligible Account." NOTWITHSTANDING the foregoing, the Borrower may include in Eligible Accounts. For purposes , provided the Account is otherwise eligible hereunder, up to $100,000.00 of determining eligibilityAccounts where the account debtor is the United States of America or any department, should twenty agency or instrumentality thereof. (i) Such Account is not payable by an account debtor for whom Twenty-Five percent (2025%) or more of the Eligible Accounts be due and owing total amount then owed to the Borrower and/or its Subsidiaries by that account debtor is ninety (90) days or more from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Accountinvoice date.

Eligible Accounts. Upon Borrower’s delivery to Lender of a Borrowing Base Certificate, Lender Agent shall determinehave the sole right, in its reasonable discretion exercised in Good Faith, to determine which Accounts are eligible (the "Eligible Accounts"). Without limiting Agent's discretion, which the following Accounts listed thereon are “shall not be Eligible Accounts”. In making this determination, Lender will consider the following requirements: : (ai) The Account is not owing more than ninety Accounts which remain unpaid one hundred twenty (90120) days after the original date of the original invoice or other writing evidencing such Account; applicable invoice; (bii) it is not all Accounts owing by an a single Account Debtor who has failed to pay twenty-five Debtor, including a currently scheduled Account, if fifty percent (2550%) or more of the aggregate amount of its balance owing by such Account Debtor to a Borrower are not, or would not be, Eligible Accounts owing to Borrower within ninety (90) days after the date as a result of the respective invoices or other writings evidencing such Accounts; application of the provisions of the preceding clause (ci); (iii) it arises from the sale of goods and such goods have been shipped or delivered Accounts with respect to which the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a validdirector, legally enforceable obligation officer, employee, Subsidiary or Affiliate of any Borrower; (iv) Accounts with respect to which the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state department, agency or political subdivision instrumentality thereof, or by unless with respect to any departmentsuch Account, agency, public body corporate or other instrumentality the applicable Borrower has complied to Agent's satisfaction with the provisions of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amendedincluding, or without limitation, executing and delivering to Agent all statements of assignment and/or notification which are in form and substance acceptable to Agent and which are deemed necessary by Agent to effectuate the assignment to Agent of such Accounts; (v) Accounts with any comparable state law, if applicable, and all other necessary steps are taken respect to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner is not a resident of the Account DebtorUnited States or the Alberta, (ii) the dissolutionBritish Columbia, liquidationManitoba, termination Nova Scotia, Ontario, Ottawa or Saskatchewan Provinces of existenceCanada, insolvency or business failure of unless the Account DebtorDebtor has supplied the applicable Borrower with an irrevocable letter of credit, issued by a financial institution satisfactory to Agent, sufficient to cover such Account in form and substance reasonably satisfactory to Agent; (iiivi) the appointment of a receiver for any part of the property of Accounts with respect to which the Account Debtor, Debtor has asserted a counterclaim or has a right of setoff (iv) an assignment for but only to the benefit extent of creditors, the filing of a petition in bankruptcy, such asserted counterclaim or the commencement of any proceeding under any bankruptcy or insolvency laws by or against setoff unless the Account Debtor; Debtor is refusing to pay the remaining amount of such Account or Accounts); (kvii) it is not an account billed in advance, payable on delivery, Accounts for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage which the prospect of payment or holdback performance by the Account Debtor is or insured may be impaired as determined by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting Agent in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Account.discretion exercised in Good Faith;

Eligible Accounts. Upon Borrower’s delivery to Lender of a Borrowing Base Certificate, Lender The Agent shall determinehave the right, in its the exercise of the Agent’s reasonable discretion, which to determine whether Accounts listed thereon are eligible for inclusion in the Borrowing Base at any particular time (such eligible accounts being referred to as “Eligible Accounts”). In making this determinationWithout limiting the Agent’s right to determine that Accounts do not constitute Eligible Accounts, Lender will consider the following requirements: Accounts shall not be Eligible Accounts: (a) The Account is not owing more than ninety all Accounts which are at that time unpaid for a period exceeding sixty (9060) days after the original invoice due date of the original invoice or other writing evidencing such Account; related thereto; (b) it is not all Accounts owing by an Account Debtor who has failed to pay twenty-five if more than ten percent (2510%) or more of the aggregate amount of its Accounts owing to Borrower within ninety by such Account Debtor are at that time unpaid for a period exceeding sixty (9060) days after the invoice due date of the respective invoices or other writings evidencing such Accounts; original invoice related thereto; (c) it arises those Accounts owing from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate agency or other instrumentality of any of the foregoing, thereof unless all necessary steps are taken to comply Borrower shall have complied with the Federal Assignment of Claims Act to the satisfaction of 1940, as amended, or the Agent; (d) Accounts which arise out of transactions with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. Affiliates; (je) it is not owing by Accounts of an Account Debtor for that is located outside the United States, unless such Accounts are covered by a letter of credit issued or confirmed by a bank acceptable to the Agent or are covered by foreign credit insurance acceptable to the Agent; (f) Accounts which Borrower has received a notice of (i) the death of the Account Debtor are or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, may be subject to a retainage rights of setoff or holdback counterclaim by the Account Debtor (to the extent of the amount of such setoff or insured by counterclaim); (g) Accounts in which the Agent does not, for any reason, have a surety company; first priority perfected security interest; and (1h) If Accounts which in the Account Debtor is located in either the State Agent’s opinion may be subject to liens or conflicting claims of New Jerseyownership, the State of Minnesota, whether such liens or the State of Indiana, Borrower has filed a Notice of Business Activities Report conflicting claims are asserted or comparable report with the applicable state authority for the then current year; (m) it is not owing could be asserted by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible AccountPerson.

Eligible Accounts. Upon Borrower’s delivery The Eligible Accounts are bona fide existing payment obligations of Account Debtors created by the rendition of services to Lender such Account Debtors in the ordinary course of a Borrowing Base CertificateBorrowers' business, Lender shall determineowed to Borrowers without, in its reasonable discretionto the knowledge of Borrowers, which Accounts listed thereon are “defenses, disputes, offsets, counterclaims, or rights of return or cancellation. As to each Eligible Accounts”. In making this determinationAccount, Lender will consider the following requirementssuch Account is not: (a) The Account is not owing more than ninety (90) days after the date owed by an employee, Affiliate, or agent of the original invoice or other writing evidencing such Accounta Borrower; (b) it is not owing on account of a transaction wherein goods were placed on consignment or were sold pursuant to a guaranteed sale, a sale or return, a sale on approval, a bill and hold, or on any other terms by an reason of which the payment ▇▇ ▇he Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accountsmay be conditional; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performedpayable in a currency other than Dollars; (d) it is evidenced owed by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor that has or some other evidence has asserted a right of billing acceptable setoff, has disputed its liability, or has made any claim with respect to Lenderits obligation to pay the Account; (e) it owed by an Account Debtor that is subject to any Insolvency Proceeding or is not evidenced by any note, trade acceptance, draft Solvent or other negotiable instrument as to which a Borrower has received notice of an imminent Insolvency Proceeding or by any chattel paper, unless a material impairment of the financial condition of such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to LenderAccount Debtor; (f) it is on account of a valid, legally enforceable obligation of transaction as to which the Account Debtor thereunder, and is not subject services giving rise to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is have not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, been performed and the subordinate security interest of Seller; (h) it is not owing accepted by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (kg) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for a right to receive progress payments or other advance billings that are due prior to the completion of performance by the ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, le Borrower of the subject to a retainage or holdback by the Account Debtor or insured by a surety companycontract for services; (1h) If an Account that has not been billed to the customer; and (i) owed by an Account Debtor is located in either any locations other than the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Accountlocations identified on Schedule 5.5.

Eligible Accounts. Upon Borrower’s delivery ELIGIBLE ACCOUNTS" shall mean all Accounts of Borrower and each Guarantor other than the following: (i) Accounts which remain unpaid as of the earlier to Lender occur of a Borrowing Base Certificate, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider the following requirements: (a) The Account is not owing more than ninety (90) days after the due date specified in the original invoice with respect thereto or one hundred twenty (120) days after the date of the original invoice or other writing evidencing such Account; with respect thereto; (bii) it is not all Accounts owing by an a single Account Debtor who has failed to pay Debtor, including a currently scheduled Account, if twenty-five percent (25%) or more of the aggregate amount of its Accounts balance owing to Borrower within ninety (90) days after the date by such Account Debtor is ineligible by reason of the respective invoices or other writings evidencing such Accounts; criterion set forth in clause (ci) it arises from the sale of goods and such goods have been shipped or delivered this Section 9.1; (iii) Accounts with respect to which the Account Debtor under such Accountis an Affiliate of either Borrower or a Guarantor or a director, officer or employee of Borrower, any Guarantor or its Affiliates; or it arises from services rendered and such services have been performed; (div) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered Accounts with respect to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of which the Account Debtor thereunder, and is not subject to any offset, counterclaim a Governmental Authority or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, prime contractor thereof unless Borrower or any state thereof, or under the laws of any province Guarantor has complied in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken a manner satisfactory to comply Agent with the Federal Assignment of Claims Act of 1940, as amended, or similar law or statute of the relevant state, province, municipality or other jurisdiction and any amendments thereto, relative to the assignment of such Accounts; (v) Accounts with any comparable state law, if applicable, and all other necessary steps are taken respect to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner is not a resident of the Account Debtor, United States or Canada (ii) other than the dissolution, liquidation, termination provinces of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇ ▇▇▇▇▇▇ Island, Newfoundland and Nova Scotia and the Northwest Territories) unless such Account is payable at in United States Dollars and the Account Debtor has supplied Borrower or any Guarantor with an irrevocable letter of credit, issued by a future date financial institution satisfactory to the Required Lenders, in accordance an amount sufficient to cover such Account and in form and substance satisfactory to the Required Lenders and without right of setoff; (vi) Accounts arising with its terms, subject respect to a retainage or holdback goods which have not been shipped and delivered to and accepted as satisfactory by the Account Debtor or insured arising with respect to services which have not been fully performed and accepted as satisfactory by the Account Debtor; (vii) Accounts for which the prospect of payment in full or performance in a surety company; (1) If timely manner by the Account Debtor is located or is likely to become impaired as determined by Agent in either the State exercise of New Jersey, its discretion; (viii) Accounts which are not invoiced (and dated as of the State date of Minnesota, such invoice) and sent to the Account Debtor within five (5) days after delivery of the underlying goods to or performance of the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority underlying services for the then current year; Account Debtor; (mix) it is not owing by any Account Debtor whose obligations LenderAccounts with respect to which Agent, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more on behalf of the Eligible Accounts be due Lenders, does not have a first and owing from valid fully perfected Lien free and clear of any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Account.other Lien;

Eligible Accounts. Upon Borrower’s delivery to Lender of a Borrowing Base Certificate, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination” include all of Borrowers’ Accounts other than the following, Lender will consider the following requirements: unless approved in writing by Administrative Agent in each case: (ai) The any Account is with respect to which Administrative Agent does not owing more than ninety have a valid and enforceable, perfected first priority Security Interest; (90ii) any Account which remains unpaid as of 90 days after the original date of the original invoice applicable invoice, provided, however, (1) if the Account Debtor is a Governmental Authority or other writing evidencing such Account; (b) it is not owing by an Account Debtor who has failed whose primary purpose is to pay twenty-five percent provide educational services, then the foregoing number of days shall be 120; and (25%2) if the Account Debtor’s primary purpose is to provide health care services, then, at Administrative Agent’s sole discretion, the number of days shall be 120, (iii) any Account of a single Account Debtor if 50% or more of the aggregate amount of its balances due on all Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which are ineligible under clause (i) or (ii); (iv) any Account with respect to which the Account Debtor is a Borrower, a Subsidiary or an Affiliate thereof or an employee or officer of Borrower or any Subsidiary or Affiliate thereof, provided, however, that the foregoing shall not be applicable to arm’s-length transactions with portfolio companies of the Borrowers’ Major Shareholders; (v) any Account with respect to which the Account Debtor does not maintain its chief executive office in within the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under Account with respect to which the laws of any province in Canada, or (iii) Account Debtor is the government of any foreign country or sovereign stateany municipality or other political subdivision thereof, or of any statedepartment, provinceagency, municipality public corporation or other instrumentality thereof; ; (ivi) it any Account which is created from the rental or lease of any Inventory not owned by Borrower; (vii) any Account with respect to goods or services whose delivery or performance has been rejected by the Account Debtor or whose earlier acceptance has been revoked; (viii) any Account arising from the delivery of goods for which an invoice has not been sent to the Account Debtor within 10 days after such delivery or any Account arising from the performance of services for which an invoice has not been sent to the Account Debtor within thirty (30) days after such performance; (ix) any Account owing by an Account Debtor that is the subject of a bankruptcy or similar insolvency proceeding, has made an assignment for the benefit of creditors, has acknowledged that it is unable to pay its debts as they mature, or whose assets have been transferred to a receiver or trustee, or who has ceased business as a going concern; (x) any Account with respect to which the Account Debtor’s obligation to pay the Account is conditional upon the Account Debtor’s approval or is otherwise subject to any repurchase obligation or return right, as with sales made on a ▇▇▇▇-and-hold, guarantied sale, sale-and-return, sale on approval (except with respect to Accounts in connection with which Account Debtors are entitled to return Inventory solely on the basis of the quality of such Inventory) or consignment basis, provided, however, that ▇▇▇▇-and-hold Accounts shall be considered eligible (subject to all other eligibility criteria contained herein) for that portion of the related Accounts which have been performed, earned and invoiced and for which title to the Inventory has passed to the Account Debtor, and which the applicable Account Debtor is unconditionally obligated to pay without offset, defense or counterclaim under the terms of the specific customer agreements, subject to the Administrative Agent’s review and satisfaction with the underlying contract and/or purchase order associated therewith and as specifically agreed to in writing by the Administrative Agent, (xi) any Account owing by an Account Debtor that has disputed liability or made any claim with respect to any other Account due from such Account Debtor, or that has any right of set-off against such Account, or to which Borrower is indebted in any way, but only to the extent of such indebtedness, set-off, dispute or claim; (xii) any Account subject to a chargeback from a volume discount or an advertising discount, but only to the extent of such chargeback or discount; (xiii) [Intentionally Omitted]; (xiv) any Account of an Account Debtor with respect to particular goods still in the possession of the creditor on the Account or included in Inventory of such creditor and against which the Account Debtor has filed a financing statement under the UCC or has obtained or purported to have obtained a Security Interest; (xv) any Account with respect to which the delivery of goods or performance of services is bonded in favor of Borrower; (xvi) any Account as to which Administrative Agent does not have the right or ability to obtain direct payment to Administrative Agent; (xvii) any Account with respect to which any of the covenants and agreements contained in any of the Loan Documents or any of the Representations and Warranties are not or have ceased to be complete and correct or have been breached and not cured within any applicable grace period under this Agreement; (xviii) any Account which is evidenced by a promissory note or other instrument or by chattel paper or which has been reduced to judgment; (xix) any Account which arises out of a sale or lease not made in the ordinary course of Borrower’s business; (xx) any Account for which payment terms greater than net 45 days from the date of invoice are provided or permitted; (xxi) Accounts arising from payment made by credit card, debit card, or similar instrument; (xxii) any Account owing from any supplier or Vendor of any Borrower, including, without limitation under or in connection with any rebate, subsidy, incentive or similar program, (xxiii) any Account owing to any Person other than Borrower, (xxiv) any Account arising from the leasing of Inventory, (xxv) with regards to any Accounts arising from the provision of services, any such Accounts which are invoiced prior to the performance of the applicable services provided, however, that deferred revenue ▇▇▇▇▇▇▇▇ and progress ▇▇▇▇▇▇▇▇ shall be considered eligible (subject to all other eligibility criteria contained herein) for that portion of the related Accounts which have been performed, earned and invoiced and which the applicable Account Debtor is unconditionally obligated to pay without offset, defense or counterclaim under the terms of the specific customer agreements, subject to the Administrative Agent’s review and satisfaction with the underlying contract and/or purchase order associated therewith and as specifically agreed to in writing by the Administrative Agent, (xxvi) any Account as to which the perfection of Administrative Agent’s Security Interest is governed by any federal, state or local statutory requirements other than those of the UCC or the Claims Act; (xxvii) subject to all other eligibility criteria, if Administrative Agent requests filings and acknowledgements in accordance with the Claims Act and any other steps necessary to perfect Administrative Agent’s Security Interest to be complied with to Administrative Agent’s satisfaction with respect to any Account with respect to which the Account Debtor is the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate corporation or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicablethereof, and all other necessary steps are taken such Borrower does not promptly upon such request begin the process to perfect Lender’s security interest obtain such filings and collection rights in acknowledgements or such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower filings and acknowledgments are not deemed to constitute Eligible Accounts. For purposes obtained within 120 days (or such longer period of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%time as Administrative Agent may consent to) of such Accounts shall not be eligible, regardless request; (xxviii) any Account as to which Administrative Agent has determined in its reasonable discretion that the prospect of whether such Accounts payment or collection on a timely basis is impaired or that Administrative Agent otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease deems in its reasonable discretion to be an Eligible Accountuncreditworthy.

Eligible Accounts. Upon Borrower’s delivery to Lender On any date of a determination of the Borrowing Base, all of the Accounts owned by the Sales Companies and reflected in the most recent Borrowing Base CertificateCertificate delivered by the Administrative Borrower to the Collateral Agent and the Administrative Agent shall be “Eligible Accounts” for the purposes of this Agreement, Lender shall determineexcept any Account to which any of the exclusionary criteria set forth below applies. In addition, the Collateral Agent reserves the right, at any time and from time to time after the Restatement Date, to adjust any of the criteria set forth below, to establish new criteria and to adjust the applicable advance rate with respect to Eligible Accounts, in its reasonable discretioncredit judgment, subject to the approval of the Supermajority Revolving Lenders in the case of adjustments, new criteria or changes in the applicable Advance Rates which have the effect of making more credit available. Eligible Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider shall not include any of the following requirementsAccounts: (ai) The any Account is not owing more than ninety (90) days after in which the date Collateral Agent, on behalf of the original invoice or other writing evidencing such AccountSecured Parties, does not have a first priority and exclusive perfected Lien; (bii) it any Account that is not owing owned by a Sales Company; (iii) any Account due from an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it that is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office domiciled in the United States of America or Canada, Canada and (iiif not a natural Person) is not organized under the laws of the United States of America, or Canada or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality political subdivision thereof; (iiv) it any Account that is payable in any currency other than Dollars; (v) any Account that does not arise from the sale of goods or the performance of services by such Sales Company in the ordinary course of its business; (vi) any Account that does not comply in any material respect with all applicable legal requirements, including, without limitation, all laws, rules, regulations and orders of any Governmental Authority; (vii) any Account (a) upon which a Sales Company’s right to receive payment is not absolute or is contingent upon the fulfillment of any condition whatsoever unless such condition is satisfied or (b) as to which a Sales Company is not able to bring suit or otherwise enforce its remedies against the Account Debtor through judicial or administrative process or (c) that represents a progress billing consisting of an invoice for goods sold or used or services rendered pursuant to a contract under which the Account Debtor’s obligation to pay that invoice is subject to a Sales Company’s completion of further performance under such contract or is subject to the equitable lien of a surety bond issuer; (viii) to the extent that any defense, counterclaim, setoff or dispute is asserted as to such Account, it being understood that the remaining balance of the Account shall be eligible; (ix) any Account that is not a true and correct statement of bona fide indebtedness incurred in the amount of the Account for goods sold to or services rendered and accepted by the applicable Account Debtor; (x) any Account with respect to which an invoice or other electronic transmission constituting a request for payment, reasonably acceptable to the Collateral Agent in form and substance, has not been sent on a timely basis to the applicable Account Debtor according to the normal invoicing and timing procedures of the Sales Company; (xi) any Account that arises from a sale to any director, officer, other employee or Affiliate of any Sales Company, or to any entity that has any common officer or director with any Sales Company; (xii) to the extent any Sales Company or any Subsidiary is liable for goods sold or services rendered by the applicable Account Debtor to any Sales Company or any Subsidiary but only to the extent of the potential offset; (xiii) any Account that arises with respect to goods that are delivered on a ▇▇▇▇-and-hold, cash-on-delivery basis or placed on consignment, guaranteed sale or other terms by reason of which the payment by the Account Debtor is or may be conditional; (xiv) any Account that is in default; provided, that, without limiting the generality of the foregoing, an Account owing by shall be deemed in default upon the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality occurrence of any of the foregoingfollowing: (1) any Account not paid within 90 days following its original invoice date or that is more than 60 days past due according to its original terms of sale; or (2) the Account Debtor obligated upon such Account suspends business, makes a general assignment for the benefit of creditors or fails to pay its debts generally as they come due; or (3) a petition is filed by or against any Account Debtor obligated upon such Account under any bankruptcy law or any other federal, state or foreign (including any provincial) receivership, insolvency relief or other law or laws for the relief of debtors; (xv) any Account that is the obligation of an Account Debtor (other than an individual) if 50% or more of the Dollar amount of all Accounts owing by that Account Debtor are ineligible under the other criteria set forth in this Section 2.19(a); (xvi) any Account as to which any of the representations or warranties in the Loan Documents are untrue; (xvii) to the extent such Account is evidenced by a judgment, Instrument or Chattel Paper; (xviii) to the extent such Account exceeds any credit limit established by the Collateral Agent, in its reasonable credit judgment, following prior notice of such limit by the Collateral Agent to the Administrative Borrower; (xix) that portion of any Account (a) in respect of which there has been, or should have been, established by any Sales Company a contra account, whether in respect of contractual allowances with respect to such Account, audit adjustment, anticipated discounts or otherwise, or (b) which is due from an Account Debtor to whom any Sales Company owes a trade payable, but only to the extent of such trade payable or (c) which any Sales Company knows is subject to the exercise by an Account Debtor of any right of recession, set-off, recoupment, counterclaim or defense; or (xx) any Account on which the Account Debtor is a Governmental Authority, unless all necessary steps are taken any Sales Company has assigned its rights to comply with payment of such Account to the Federal Collateral Agent pursuant to the Assignment of Claims Act of 1940, as amended, or with any comparable state in the case of a federal Governmental Authority, and pursuant to applicable law, if applicableany, in the case of any other Governmental Authority, and all other necessary steps are taken to perfect Lender’s security interest such assignment has been accepted and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback acknowledged by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Accountappropriate government officers.

Eligible Accounts. Upon Borrower’s delivery to Lender of a Borrowing Base Certificate, Lender The Agent shall determinehave the sole right, in its reasonable ----------------- discretion, to determine which Accounts listed thereon are “eligible ("Eligible Accounts”"). In making this determination----------------- addition, Lender will consider without limiting the Agent's discretion, unless otherwise agreed by the Agent in writing, the following requirementsAccounts are not Eligible Accounts: (a) The Account is not owing Accounts which remain unpaid more than ninety sixty (9060) days after from the stated due date of or more than 120 days from the original invoice or other writing evidencing such Account; date, in each case based upon the end-of-the-month aging; (b) it is not all Accounts owing by an a single Account Debtor who has failed to pay twenty-five Debtor, including currently scheduled Accounts, if fifty percent (2550%) or more of the aggregate amount of its Accounts balance owing by such Account Debtor to the Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; is ineligible for any reason; (c) it arises from the sale of goods and such goods have been shipped or delivered Accounts with respect to which the Account Debtor under such Accountis a director, officer, employee, Subsidiary or Affiliate of the Borrower; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered Accounts with respect to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of which the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state department, agency or political subdivision instrumentality thereof, or by any departmentunless the Borrower assigns its right to payment of such Accounts to the Agent pursuant to, agencyand in full compliance with, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, ; (e) Accounts with respect to which the Account Debtor is not a resident of the United States; (f) Accounts in dispute or with any comparable state law, if applicable, and all other necessary steps are taken respect to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an which the Account Debtor for has asserted in writing or either the Borrower or the Agent has reason to believe the Account Debtor is entitled to assert a counterclaim or has asserted in writing or either the Borrower or the Agent has reason to believe the Account Debtor is entitled to assert a right of setoff; (g) Accounts with respect to which Borrower has received the prospect of payment or performance by the Account Debtor is or will be impaired, as determined by the Agent in the exercise of its discretion; (h) Accounts with respect to which the Agent does not have a notice of first and valid fully perfected security interest; (i) the death of Accounts with respect to which the Account Debtor is the subject of bankruptcy or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, a similar insolvency proceeding or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) has made an assignment for the benefit of creditors, the filing of creditors or whose assets have been conveyed to a petition in bankruptcy, receiver or the commencement of any proceeding under any bankruptcy or insolvency laws by or against trustee; (j) Accounts with respect to which the Account Debtor; (k) it 's obligation to pay the Account is not an account billed in advanceconditional upon the Account Debtor's approval or is otherwise subject to any repurchase obligation or return right, payable as with sales made on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress a ▇▇▇▇▇▇▇▇-and-hold, payable at guaranteed sale, sale-and-return, sale on approval or consignment basis; (k) Accounts to the extent that the Account Debtor's indebtedness to the Borrower exceeds a future date in accordance with its terms, subject to a retainage or holdback credit limit determined by the Account Debtor or insured by a surety company; Agent in the Agent's discretion; (1) If Accounts with respect to which the Account Debtor is located in either the State of New Jersey, the State of Minnesota, Tennessee or Indiana unless the State Borrower (i) has received a certificate of Indianaauthority to do business, Borrower and is in good standing, in such state, or (ii) has filed a Notice of Business Activities Report (or other comparable report required report) with the applicable proper authorities of such state authority for the then current year; ; (m) it is Accounts which arise out of sales not owing by any made in the ordinary course of the Borrower's business; (n) Accounts with respect to which the Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified has returned to the Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) all or more any portion of the Inventory the sale of which gave rise to such Accounts; and (o) Accounts with respect to which any document or agreement executed or delivered in connection therewith, or any procedure used in connection with any such document or agreement, fails in any material respect to comply with the requirements of applicable law, or with respect to which any representation or warranty contained in this Agreement is untrue. If the Borrower determines that a previously scheduled Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease ceases to be an Eligible AccountAccount under any of the above described criteria, the Borrower shall notify the Agent thereof at the earliest reasonable opportunity.

Eligible Accounts. Upon Borrower’s delivery to Lender Bank of a Borrowing Base Certificatereport of Accounts (as provided in Section 5.6), Lender Bank shall determinemake a determination, in its reasonable sole discretion, as to which Accounts listed thereon are “shall be deemed an "Eligible Account". In determining which Accounts will be "Eligible Accounts”. In making this determination", Lender will Bank may, INTER ALIA, consider the following requirements: The Account is subject to a perfected first priority Lien in favor of Bank and is due no more than thirty (30) days from the date of invoice under the original terms of shipment or service, arises from the delivery of goods or performance of services by Borrower in the ordinary course of its business, conforms to the warranties and representations set forth in Section 6.2 and: (aA) The is an Account upon which Borrower's right to receive payment is absolute and not owing contingent upon any further performance or delivery or the fulfillment of any condition whatsoever (e.g., consignment or guaranteed sale) and does not include any sales or other taxes, and Borrower has possession of, or has delivered or will deliver as required hereunder to Bank, copies of invoices, shipping and delivery receipts evidencing such performance or shipment; (B) is unpaid for not more than ninety (90) days after following the date of the original invoice or other writing evidencing such Accountinvoice; (bC) it does not arise from a sale or sales to an Affiliate or from a consumer transaction (being one for primarily personal, family or household purposes); (D) is not owing the obligation of an Account Debtor located in a foreign country other than Canada, except those foreign Accounts supported by a letter of credit acceptable to Bank which letter of credit is confirmed or issued by a United States bank or other bank acceptable to Bank or is an Eligible Account insured by the Foreign Credit Insurance Association, provided that the letter of credit or insurance in respect of such foreign Accounts is assigned to Bank by assignments in form and substance satisfactory to Bank; (E) does not arise from a contract containing a prohibition against the assignment or grant of a security interest therein; (F) is not an Account from the United States of America or any agency thereof, unless Bank is satisfied that its security interest in such Account has been perfected pursuant to the Federal Assignment of Claims Act; (G) is not an Account of an Account Debtor who has failed suspended business, made a general assignment for the benefit of creditors, committed any act of insolvency, filed or has had filed against it any petition under any bankruptcy law or any other law or laws for the relief of debtors; (H) is not evidenced by an instrument, chattel paper or other written agreement (other than invoices), unless the Instrument or Chattel Paper evidencing the Account has been delivered to pay and endorsed in favor of Bank; (I) does not, when added to any and all other Accounts of the Account Debtor with Borrower, produce an aggregate indebtedness from the Account Debtor of more than (i) as to Home Depot, thirty percent (30%) of the total of all of Borrower's Eligible Accounts (subject to Borrower's obtaining and maintaining credit insurance in respect of Accounts owing by Home Depot satisfactory to Bank), and (ii) as to all other Account Debtors, that percentage of the total of all of Borrower's Eligible Accounts as Bank may determine from time to time as to each such Account Debtor; (J) is not an Account of an Account Debtor who shall have objected to paying such Account, or any portion thereof, as a result of an objection to the quality or quantity of goods or services provided by Borrower, or shall have rejected, returned or refused to accept such goods or services; (K) is not an Account of an Account Debtor which has twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within unpaid more than ninety (90) days after following the date of the respective invoices or other writings evidencing such Accounts;invoice date; and (cL) it arises from the sale of goods and such goods have been shipped or delivered to is not an Account which is, in Bank's good faith judgment, (i) the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America is an undue credit risk or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken otherwise unacceptable to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such AccountBank. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Account.

Eligible Accounts. Upon Borrower’s delivery to Lender On any date of a determination of the Borrowing Base, all of the Accounts owned by any of the Borrowers and reflected in the most recent Borrowing Base Certificate, Lender Certificate delivered by the Borrower Representative to the Administrative Agent and the Co-Collateral Agents shall determine, in its reasonable discretion, which Accounts listed thereon are be “Eligible Accounts”” for the purposes of this Agreement, except any Account to which any of the exclusionary criteria set forth below applies. In making this determinationaddition, Lender will consider the Administrative Agent and the Co-Collateral Agents shall have the right from time to time in their Permitted Discretion to establish, modify or eliminate Reserves against Eligible Accounts, to adjust any of the criteria set forth below and to establish new criteria with respect to Eligible Accounts. Eligible Accounts shall not include any of the following requirementsAccounts: (i) any Account in which the Administrative Agent, on behalf of the Secured Parties, does not have a perfected, first priority Lien, subject to (a) The Account is Permitted Liens that do not owing more than ninety (90) days after have priority over the date Lien in favor of the original invoice Administrative Agent and (b) Liens created by applicable law which rank or other writing evidencing such Accountare capable of ranking prior to or pari passu with the Lien in favor of the Administrative Agent that secure amounts that are not yet due and payable; (bii) it any Account that is not owing owned by a Borrower; (iii) any Account due from an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it that is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office domiciled in the United States of America or Canada, and (iiif not a natural person) is not organized under the laws of the United States of America, or any state thereof, or under political subdivision thereof unless such Account is backed by a letter of credit satisfactory in form and substance to the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereofAdministrative Agent and Co-Collateral Agents; (iiv) it any Account that is payable in any currency other than dollars; (v) any Account that does not arise from the sale of goods or the performance of services by a Borrower in the ordinary course of its business; (vi) any Account that does not comply in all material respects with all applicable legal requirements, including, without limitation, all laws, rules, regulations and orders of any Governmental Authority; (vii) any Account (a) to the extent that the applicable Borrower’s right to receive payment is not absolute or is contingent upon the fulfillment of any condition whatsoever unless such condition is satisfied or (b) as to which a Borrower is not able to bring suit or otherwise enforce its remedies against the Account Debtor through judicial or administrative process or (c) that represents a progress billing consisting of an invoice for goods sold or used or services rendered pursuant to a contract under which the Account Debtor’s obligation to pay that invoice is subject to such Borrower’s completion of further performance under such contract or is subject to the equitable lien of a surety bond issuer; (viii) to the extent that any defense, counterclaim, setoff or dispute is asserted as to such Account, it being understood that the remaining balance of the Account shall be eligible; (ix) any Account that is not a true and correct statement of bona fide indebtedness incurred in the amount of the Account for merchandise sold to or services rendered and accepted by the applicable Account Debtor; (x) any Account with respect to which an invoice or other electronic transmission constituting a request for payment, reasonably acceptable to the Administrative Agent and the Co-Collateral Agents in form and substance, has not been sent on a timely basis to the applicable Account Debtor according to the normal invoicing and timing procedures of the applicable Borrower; (xi) any Account that arises from a sale to any director, officer, other employee or Affiliate of a Borrower, or to any entity that has any common officer or director with a Borrower other than Accounts, not to exceed $5,000,000 in the aggregate, that arise from sales to CHS, Inc. or its Subsidiaries or Affiliates, so long as such sale is made in accordance with Section 6.09; (xii) to the extent a Borrower or any Subsidiary is liable for goods sold or services rendered by the applicable Account Debtor to a Borrower or any Subsidiary but only to the extent of the potential offset; (xiii) any Account that arises with respect to goods that are delivered on a ▇▇▇▇-and-hold, cash-on-delivery basis or placed on consignment, guaranteed sale or other terms by reason of which the payment by the Account Debtor is or may be conditional; (xiv) any individual Account that is in default; provided that, without limiting the generality of the foregoing, an Account owing by shall be deemed in default upon the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality occurrence of any of the foregoingfollowing: (a) any Account that has not been paid within 120 days following its original invoice date or that is more than 60 days past due according to its original terms of sale; or (b) the Account Debtor obligated upon such Account suspends business, makes a general assignment for the benefit of creditors or fails to pay its debts generally as they come due; or (c) a petition is filed by or against any Account Debtor obligated upon such Account under any bankruptcy law or any other federal, state or foreign (including any provincial) receivership, insolvency relief or other law or laws for the relief of debtors; (xv) any Account that is the obligation of an Account Debtor if 50% or more of the dollar amount of all Accounts owing by that Account Debtor are ineligible under the other criteria set forth in this Section 2.18(a); (xvi) any Account as to which any of the representations or warranties in the Loan Documents are untrue in any material respect; (xvii) to the extent such Account is evidenced by a judgment, Instrument or Chattel Paper; (xviii) to the extent such Account exceeds any credit limit established by the Administrative Agent and the Co-Collateral Agents, in their Permitted Discretion; (xix) any Account on which the Account Debtor is a Governmental Authority, unless all necessary steps are taken a Borrower has assigned its rights to comply with payment of such Account to the Federal Administrative Agent, on behalf of the Secured Parties, pursuant to the Assignment of Claims Act of 1940, as amended, or with any comparable state in the case of a federal Governmental Authority, and pursuant to applicable law, if applicableany, in the case of any other Governmental Authority, and all other necessary steps are taken to perfect Lender’s security interest such assignment has been accepted and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback acknowledged by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Accountappropriate government officers.

Eligible Accounts. Upon Borrower’s delivery to Lender of a Borrowing Base Certificate, Lender FBS Ag Credit shall determinehave the right, in its the ----------------- exercise of FBS Ag Credit's reasonable discretion, which to determine whether Accounts listed thereon are “eligible for inclusion in the Borrowing Base at any particular time (such eligible accounts being referred to as "Eligible Accounts”"). In making this determinationWithout limiting FBS Ag Credit's right to determine that Accounts do not constitute Eligible Accounts, Lender will consider the following requirements: Accounts shall not be Eligible Accounts: (a) The Account is not owing more than ninety all Accounts which are at that time unpaid for a period exceeding sixty (9060) days after the original invoice date of the original invoice or other writing evidencing such Account; related thereto; (b) it is not all Accounts owing by an Account Debtor who has failed to pay twenty-five percent (25%) or if more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of the Accounts owing by such Account Debtor are at that time unpaid for a period exceeding sixty (60) days after the invoice due date of the original invoice related thereto; (c) those Accounts, except Accounts owing from the Account Debtors listed on Exhibit 3A, of an Account Debtor, the aggregate face amount of ---------- which is in excess of five percent (5%) of the aggregate face amount of all other Eligible Accounts of all Account Debtors; (d) Accounts which arise out of transactions with Affiliates; (e) Accounts of an Account Debtor that are located outside the United States, unless such Accounts shall not are covered by a letter of credit issued or confirmed by a bank acceptable to FBS Ag Credit; (f) Accounts which are or may be eligiblesubject to rights of setoff or counterclaim by the Account Debtor; and (g) Accounts which in FBS Ag Credit's opinion may be subject to liens or conflicting claims of ownership, regardless of whether such liens or conflicting claims are asserted or could be asserted by any Person. In the event that Accounts otherwise satisfy previously included in the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith Borrowing Base cease to be Eligible Accounts, Borrower shall promptly pay to FBS Ag Credit an Eligible Accountamount sufficient to ensure that the Liabilities, other than the Liabilities evidenced by the Line of Credit Note, shall at no time exceed the then current Borrowing Base.

Eligible Accounts. Upon The words "Eligible Accounts" mean, at any time, all of Borrower’s delivery 's Accounts which contain selling terms and conditions acceptable to Lender. The net income of any Eligible Account against which Borrower may borrow shall exclude all returns, discounts, credits, and offsets of any nature. Unless otherwise agreed to by Lender in writing, Eligible Accounts do not include: (i) Accounts with respect to which the Account Debtor is an officer, an employee or agent of Borrower; (ii) Accounts with respect to which the Account Debtor is a Borrowing Base CertificateSubsidiary of, Lender shall determineor affiliated with or related to Borrower or its officers, or directors; (iii) Accounts with respect to which goods are placed on consignment, guaranteed sale, or other terms by reason of which the payment by the Account Debtor may be conditional; (iv) Accounts with respect to which Borrower is or may become liable to the Account Debtor for goods sold or services rendered by the Account Debtor to borrower; (v) Accounts which are subject to dispute, counterclaim, or setoff; (vi) Accounts with respect to which the goods have not been shipped or delivered, or the services have not been rendered, to the Account Debtor; (vii) Accounts with respect to which Lender, in its reasonable sole discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider deems the following requirements: (a) The Account is not owing more than ninety (90) days after the date creditworthiness or financial condition of the original invoice or other writing evidencing such Account; Account Debtor to be unsatisfactory; (bviii) it is not owing by an Accounts of any Account Debtor who has failed to pay twentyfiled or has had filed against it a petition in bankruptcy or an application for relief under any provision of any state or federal bankruptcy, insolvency, or debtor-five percent (25%) in-relief acts, or more of who has had appointed a trustee, custodian, or receiver for the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part assets of such Account Debtor Debtor; or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) who had made an assignment for the benefit of creditors, creditors or has become insolvent or fails generally to pay its debts (including its payrolls) as such debts become due; (ix) Accounts which had not been paid in full within sixty (60) days from the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; invoice date; (kx) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress Datings; Progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the ; Retainages; Cash Sales; C.O.D.; Service Charges; (xi) any Account of an Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it that is not owing by any Account Debtor whose obligations Lendera resident of the United States, acting in its sole discretionPuerto Rico, shall have notified Borrower and Canada; or (xii) Accounts which are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible AccountCollateral.

Eligible Accounts. Upon Borrower’s delivery ELIGIBLE ACCOUNTS" shall mean all Accounts other than the following: (i) Accounts which remain unpaid as of the earlier to Lender occur of a Borrowing Base Certificate, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider the following requirements: (a) The Account is not owing more than ninety (90) days after the due date specified in the original invoice with respect thereto or one hundred twenty (120) days after the date of the original invoice or other writing evidencing such Account; with respect thereto; (bii) it is not all Accounts owing by an a single Account Debtor who has failed to pay Debtor, including a currently scheduled Account, if twenty-five percent (25%) or more of the aggregate amount of its Accounts balance owing to Borrower within ninety (90) days after the date by such Account Debtor is ineligible by reason of the respective invoices or other writings evidencing such Accounts; criterion set forth in clause (ci) it arises from the sale of goods and such goods have been shipped or delivered this Section 9.1; (iii) Accounts with respect to which the Account Debtor under such Accountis an Affiliate of either Borrower or a Guarantor or a director, officer or employee of Borrower, any Guarantor or its Affiliates; or it arises from services rendered and such services have been performed; (div) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered Accounts with respect to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of which the Account Debtor thereunder, and is not subject to any offset, counterclaim a Governmental Authority or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, prime contractor thereof unless Borrower or any state thereof, or under the laws of any province Guarantor has complied in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken a manner satisfactory to comply Agent with the Federal Assignment of Claims Act of 1940, as amended, or similar law or statute of the relevant state, province, municipality or other jurisdiction and any amendments thereto, relative to the assignment of such Accounts; (v) Accounts with any comparable state law, if applicable, and all other necessary steps are taken respect to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor is not a resident of the United States or Canada (other than the provinces of ▇▇▇▇▇▇ ▇▇▇▇▇▇ Island, Newfoundland and Nova Scotia and the Northwest Territories) unless such Account is payable in United States Dollars and the Account Debtor has supplied Borrower or any partner Guarantor with an irrevocable letter of credit, issued by a financial institution satisfactory to the Required Lenders, in an amount sufficient to cover such Account and in form and substance satisfactory to the Required Lenders and without right of setoff; (vi) Accounts arising with respect to goods which have not been shipped and delivered to and accepted as satisfactory by the Account 50 Debtor or arising with respect to services which have not been fully performed and accepted as satisfactory by the Account Debtor, ; (iivii) Accounts for which the dissolution, liquidation, termination prospect of existence, insolvency payment in full or business failure performance in a timely manner by the Account Debtor is or is likely to become impaired as determined by Agent in the exercise of its discretion; (viii) Accounts which are not invoiced (and dated as of the date of such invoice) and sent to the Account Debtor within five (5) days after delivery of the underlying goods to or performance of the underlying services for the Account Debtor; (ix) Accounts with respect to which Agent, (iii) the appointment of a receiver for any part on behalf of the property Lenders, does not have a first and valid fully perfected Lien free and clear of any other Lien; (x) Accounts with respect to which the Account Debtor, Debtor is the subject of bankruptcy or (iv) a similar insolvency proceeding or has made an assignment for the benefit of creditors, the filing of creditors or whose assets have been conveyed to a petition in bankruptcy, receiver or the commencement of any proceeding under any bankruptcy or insolvency laws by or against trustee; (xi) Accounts with respect to which the Account Debtor; (k) it 's obligation to pay the Account is not an account billed in advanceconditional upon the Account Debtor's approval or is otherwise subject to any repurchase obligation or return right, payable as with sales made on deliverya guaranteed sale, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇-and-hold, payable at a future date in accordance with its termssale-or-return, subject to a retainage demonstration, sale on approval or holdback other terms by reason of which the payment by the Account Debtor is or insured may be conditional (except with respect to Accounts in connection with which Account Debtors are entitled to return Inventory solely on the basis of the quality of such Inventory) or consignment basis; (xii) Accounts to the extent that the Account Debtor's indebtedness to Borrower or any Guarantor exceeds a credit limit determined by a surety company; Agent in Agent's discretion following prior written notice of such credit limit from Agent to Borrower or such Guarantor; (1xiii) If Accounts with respect to which any disclosure is required in accordance with Section 9.2; (xiv) contra Accounts to the extent of the amount of the accounts payable owed by Borrower or any Guarantor to the Account Debtor; (xv) Accounts with respect to which the Account Debtor is located in Minnesota or any other state denying creditors access to its courts in the absence of a Notice of Business Activities Report or other similar filing unless Borrower or any Guarantor has either the State of New Jersey, the State of Minnesota, qualified as a foreign corporation authorized to transact business in such state or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report similar filing with the applicable Governmental Authority in such state authority for the then current year; ; (mxvi) it Accounts evidenced by Chattel Paper or any Instrument of any kind, to the extent possession of such Chattel Paper or Instrument is not owing by any Account Debtor whose obligations Lendergranted to Agent, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more for the benefit of the Eligible Lenders; (xvii) Accounts which Agent determines in good faith to be due unacceptable and owing (xviii) the Accounts do not arise from any one Account Debtor at any timethe sale of Inventory produced in violation of the Fair Labor Standards Act so as to be subject to the so-called "hot goods" provision contained in Title 19 U.S.C., then Section 215(a)(1). In the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time event that an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease Account previously scheduled in a Borrowing Base Certificate ceases to be an Eligible Account, Borrower shall notify, or shall cause the applicable Guarantor to notify, Agent thereof immediately.

Eligible Accounts. Upon Borrower’s Borrowers' delivery to Lender of a Borrowing Base Certificatean Accounts Report, Lender shall determine, in its reasonable sole discretion, which Accounts listed thereon are “"Eligible Accounts”". In making this determination, Lender will consider the following requirements: (a) If the Account arises because of the sale of goods, such goods have been shipped or delivered on open account and on an absolute sale basis and not on consignment, on approval or on a sale-or-return basis or subject to any other repurchase or return agreement and no material part of such goods has been returned (other than returns described in Section 7.4 of this Agreement), repossessed, rejected, lost or damaged; (b) The Account is not evidenced by chattel paper or an instrument of any kind; (c) The Account Debtor obligated on such Account, to the knowledge of Borrowers, is not insolvent or the subject of any bankruptcy or insolvency proceeding of any kind and Lender is satisfied with the creditworthiness of such Account Debtor; (i) The Account is owing from an Account Debtor located within the United States or, (ii) if the Account is owing from an Account Debtor located outside the United States, (A) such Account Debtor is set forth on Exhibit N hereto or Lender has approved in writing of the Account Debtor obligated under such Account and (B) notwithstanding Section 3.1(h) hereof, such Account has not remained unpaid for a period exceeding ninety (90) days after the due date of invoice; (e) The Account is a valid, legally enforceable obligation of the relevant Account Debtor and it shall not be an Eligible Account to the extent of any setoff, counterclaim, credit, allowance or adjustment asserted by such Account Debtor; (f) The Account is subject to and covered by Lender's perfected security interest and is not subject to any other lien, claim, encumbrance or security interest; (g) The Account is evidenced by an invoice or other documentation in form acceptable to Lender; (h) The Account is due and payable within sixty (60) days after the date of the invoice and has not remained unpaid for a period exceeding ninety (90) days after the due date of invoice (except with respect to certain "tooling" Accounts as determined by Lender in its sole discretion, such Account has not remained unpaid for a period exceeding one hundred fifty (150) days after the due date of invoice) and not more than fifty percent (50%) of the balance of all Accounts owing from the Account Debtor obligated under such Account has remained unpaid for more than ninety (90) days after the date of the original invoice or other writing evidencing such Account; (b) it is not owing by an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereofdue date; (i) it The Account is not owing from an Account owing by employee, officer, agent, director, stockholder or Affiliate or from the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate agency or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account.thereof; (j) it The Account is not owing by an Account Debtor for which Borrower has received one in which, when added to a notice of (i) the death of the Account Debtor or any partner of the particular Account Debtor's other indebtedness to Borrowers, exceeds fifty percent (ii50%) of all Accounts of Borrowers (except that Accounts excluded from Eligible Accounts solely by reason of this Section 3.1(j) shall be included to the dissolution, liquidation, termination extent of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtorsuch concentration limit); (k) it is not an account billed Each of the warranties and representations set forth in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable Section 9.2 of this Agreement has been reaffirmed with respect to such Account at a future date in accordance with its terms, subject the time the most recent Accounts Report was delivered to a retainage or holdback by the Account Debtor or insured by a surety company;Lender; and (1l) If the The Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it one against which Lender is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed legally permitted to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due make loans and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Accountadvances.

Eligible Accounts. Upon Borrower’s delivery As to Lender of each Account represented by the Borrower to be an "Eligible Account" on a Borrowing Base Certificate, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider as of the following requirementsdate of each such Borrowing Base Certificate: (a) The Such Account arose in the ordinary course of the business of Borrower out of either (i) a bona fide sale of Inventory by the Borrower, and in such case such Inventory has in fact been shipped to, and accepted and retained by, the appropriate account debtor or the sale has otherwise been consummated in accordance with such order, or (ii) services performed by the Borrower, under an enforceable contract, and in such case such services have in fact been performed for the appropriate account debtor in accordance with such contract. (b) Such Account represents a legally valid and enforceable claim which is due and owing to the Borrower, by such account debtor and for such amount as is represented by the Borrower, to the Bank on such Borrowing Base Certificate, such Account is due and payable not owing more than thirty (30) days from the delivery of the related Inventory, or the performance of the related services, giving rise to such Account and such Account has not been due for more than ninety (90) days after (from the date of the original invoice or other writing evidencing such Account; (b) it is not owing by an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts;invoice). (c) it arises from The unpaid balance of such Account is as represented by the sale Borrower, and not subject to any defense, counterclaim, setoff, credit, allowance or adjustment by the account debtor because of goods returned, inferior or damaged Inventory or services, or for any other reason, except for customary discounts allowed by Borrower, in the ordinary course of business for prompt payment, and such goods have been shipped there is no agreement between Borrower, the related account debtor and any other person for any rebate, discount, concession or delivered to the Account Debtor under such Account; release of liability, in whole or it arises from services rendered and such services have been performed;in part. (d) it is evidenced by an invoice, dated not later than The transactions leading to the date creation of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender;comply with all applicable state and federal laws and regulations. (e) it The Borrower has granted to the Bank a perfected security interest in such Account (as an item of the Collateral) prior in right to all other persons (other than Permitted Liens), and such Account has not been sold, transferred or otherwise assigned by the Borrower, to any person, other than the Bank. (f) Such Account is not evidenced represented by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless except any such note or other document or instrument previously has as have been endorsed and delivered by Borrower the Borrower, to Lender and is acceptable the Bank on or prior to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense such Account's inclusion on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part;Borrowing Base Certificate. (g) it is The Borrower has not subject received, with respect to any sale of accountssuch Account, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor related account debtor or any partner thereof, nor of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or insolvency, business failure of the Account Debtorfailure, (iii) the appointment of a receiver for any part of the property of the Account Debtorof, or (iv) an assignment for the benefit of creditorscreditors by, or the filing of a petition in bankruptcy, bankruptcy or the commencement of any proceeding under any bankruptcy or insolvency laws by or against against, such account debtor. (h) The account debtor on such Account is not: (i) an affiliate of the Account DebtorBorrower; (kii) it the United States of America or any department, agency or instrumentality thereof; (iii) a citizen or resident of any jurisdiction other than one of the United States (unless such Foreign Account is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by guaranty of payment in the Account Debtor or insured form of a letter of credit issued by a surety company;Bank which is acceptable to the Bank); or (1iv) If an account debtor whom the Account Debtor is located Bank has, in either the State exercise of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its such Bank's sole discretion, determined to be (based on such factors as the Bank deems appropriate) an ineligible account debtor and as to which the Bank has notified the Borrower, PROVIDED, HOWEVER, that any such notice shall have notified not apply as to any Account of such account debtor which has been included on a Borrowing Base Certificate by the Borrower are not deemed prior to constitute the giving of such notice by the Bank and which meets each and every other requirement under this Agreement for the denomination of such Account as an "Eligible Account." NOTWITHSTANDING the foregoing, the Borrower may include in Eligible Accounts. For purposes , provided the Account is otherwise eligible hereunder, up to $100,000.00 of determining eligibilityAccounts where the account debtor is the United States of America or any department, should twenty agency or instrumentality thereof. (i) Such Account is not payable by an account debtor for whom Ten percent (2010%) or more of the Eligible Accounts be due and owing total amount then owed to the Borrower and/or its Subsidiaries by that account debtor is ninety (90) days or more from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Accountinvoice date.

Eligible Accounts. Upon Borrower’s delivery All Accounts of any Borrower meeting all of the ----------------- following specifications: (i) the Account is lawfully and exclusively owned by such Borrower and subject to Lender no Lien other than Liens of Lender, and such Borrower has the right of assignment thereof and the power to grant a Borrowing Base Certificate, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider security interest therein; (ii) the following requirements: Account is valid and enforceable representing the indebtedness of an Account Debtor not more than 90 days past the original invoice date; (aiii) The the Account is not subject to any defense, set-off, counterclaim, dispute, deduction, discount, credit, chargeback, freight claim, allowance or adjustment of any kind; (iv) no part of any goods, the sale or lease of which has given rise to the Account, has been returned, rejected, lost or damaged; (v) if the Account arises from the sale of goods by such Borrower, such sale was an absolute sale and not on consignment or on approval or on a sale-or-return basis or subject to any other repurchase or return agreement, and such goods have been shipped to the Account Debtor or its designee; (vi) if the Account arises from the performance of services, such services have actually been performed; (vii) the Account arose in the ordinary course of such Borrower's business; (viii) no notice of the bankruptcy, receivership, reorganization, liquidation, dissolution, or insolvency of the Account Debtor has been received by Lender or Borrower; (ix) the Account Debtor is not a Subsidiary, Affiliate or employee of any Borrower and does not control any Borrower and is not under the control of or under common control with any Borrower; (x) it is not an Account of an Account Debtor having its principal place of business or executive office outside of the United States unless such Account is guaranteed in full by an irrevocable letter of credit satisfactory to Lender and assigned and delivered to Lender; (xi) the Account does not represent a sale to the government of the United States or any subdivision thereof unless such Borrower has complied, for the benefit of Lender, with the Federal Assignment of Claims Act; (xii) the Account, together with all other Accounts owing from the same Account Debtor, represents no more than fifteen percent (15%) of all of the Accounts of Borrowers; (xiii) not more than fifty percent (50%) of the aggregate balance of all Accounts owing from the Account Debtor obligated on the Account are outstanding more than ninety (90) days after the date of the original past their invoice or other writing evidencing such Account; date; (bxiv) it is not owing by an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder payable in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws lawful money of the United States of America, or any state thereof, or under the laws of any province in Canada, or States; and (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (ixv) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws meets such other specifications and requirements which may from time to time be established by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute . Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not include that portion of an Account representing interest or late charges for past due balances or debit memos. Lender is willing, however, upon Borrowers' request, to consider including (such consideration to be eligiblegiven in Lender's sole discretion under such guidelines as Lender may apply concerning the validity, regardless enforceability, lien priority, performance, or collectibility of whether such Accounts otherwise satisfy or other criteria applicable to the criteria for eligibility set forth above. An Account) an Account which is at any time of a foreign Account Debtor as an Eligible Account, but which subsequently fails to Account where such Account would not otherwise meet any the requirements of the foregoing requirements, shall forthwith cease to be an Eligible Accountclause (x) above.

Eligible Accounts. Upon Borrower’s delivery Accounts of the U.S. Borrower and the other U.S. Domiciled Loan Parties subject to Lender the Lien of a Borrowing Base Certificatethe Agent, Lender the value of which shall determinebe determined by taking into consideration, among other factors, their book value determined in its reasonable discretionaccordance with GAAP; provided, which however, that none of the following classes of Accounts listed thereon are “shall be deemed to be U.S. Eligible Accounts”. In making this determination, Lender will consider the following requirements: (aaa) The Account is Accounts that do not owing arise out of sales of goods or rendering of services in the ordinary course of the U.S. Borrower’s or the relevant U.S. Domiciled Loan Party’s business; (bb) Accounts payable other than in Dollars or that are otherwise on terms other than those normal or customary in the U.S. Borrower’s or the relevant U.S. Domiciled Loan Party’s business; (cc) Accounts more than ninety (90) days after the date of the past original invoice or other writing evidencing such Accountdate; (bdd) it Accounts owing from any Person that is not an Affiliate of a Loan Party; (ee) Accounts arising out of sales to Account Debtors outside the United States and Canada, unless the Account is supported by a letter of credit (the original of which is delivered to and directly drawable by the Agent) or credit insurance satisfactory in all respects to the Agent; (ff) Accounts owing by from any Person from which an Account Debtor who has failed to pay twenty-five aggregate amount of fifty percent (2550%) or more of the aggregate amount of its Accounts owing to Borrower within ninety therefrom are otherwise ineligible; (90gg) days after the date Accounts in respect of the respective invoices or other writings evidencing such Contra Accounts; (chh) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; Accounts owing by a Government Authority (d) it is evidenced by an invoiceother than Municipal Government Accounts that, dated not later than the date of shipment or performancebut for this clause (h), rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paperare U.S. Eligible Accounts), unless such note or other document or instrument previously has Accounts are Federal Government Accounts that have been endorsed and delivered by Borrower assigned to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder Agent in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply compliance with the Federal Assignment of Claims Act; provided that Accounts that are not compliant with the Assignment of Claims Act of 1940, may be included in the U.S. Borrowing Base as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights provided in such Account. clause (jb) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner definition of the Account Debtor, U.S. Borrowing Base; (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition Accounts in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of all U.S. Eligible Accounts owing to any Account Debtor or Affiliate of such account debtor whose total Accounts comprise greater than twenty (20%) of all U.S. Eligible Accounts. (jj) Accounts owing from any Person that (i) has disputed liability for any Accounts owing from such Person or (ii) has otherwise asserted any claim, demand or liability against any Loan Party or any Subsidiary thereof, whether by action, suit, counterclaim or otherwise; provided, that for purposes of subclause (j)(i), such Accounts shall be excluded only to the extent of the amounts being disputed by such Person at any date of determination; (kk) Accounts owing from any Person that is or becomes the subject of any action or proceeding of a type described in Section 11.1(f), or admits in writing an inability, or fails generally to pay, its debts as they become due, or is not be eligibleSolvent, regardless or is subject to any country sanctions program or specially designated nationals list maintained by the Office of whether Foreign Assets Control of the U.S. Treasury Department; (ll) Accounts (i) owing from any Person that is also a supplier to or creditor of a Loan Party or any Subsidiary thereof unless such Person has waived any right of setoff in a manner acceptable to the Agent or (ii) representing any manufacturer’s or supplier’s credits, discounts, incentive plans or similar arrangements entitling any Loan Party or any Subsidiary thereof to discounts on future purchase therefrom; (mm) Accounts otherwise satisfy arising out of sales on a ▇▇▇▇-and-hold, progress billing, guaranteed sale, sale-or-return, sale on approval or consignment basis or subject to any right of return, setoff or charge back; (nn) Accounts with respect to which the criteria for eligibility representations and warranties set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any in Section 3 of the foregoing requirementsU.S. Security Agreement applicable to Accounts are not correct; (oo) Accounts in respect of which the U.S. Security Agreement, shall forthwith cease after giving effect to be an Eligible Accountthe related filings of financing statements that have then been made, if any, does not or has ceased to create a valid and perfected first priority lien or security interest in favor of the Agent, on behalf of the U.S. Facility Secured Parties, securing the U.S. Facility Obligations; and (pp) Accounts owing from any Person that is located in a state that requires the filing of a business activity report or similar report and with respect to which the U.S. Borrower or other U.S. Domiciled Loan Party, as applicable, has not actually filed such a report.

Eligible Accounts. Upon Borrower(A) With respect to each of Debtor’s delivery to Lender of a Borrowing Base Certificate, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider the following requirements: Debtor represents that: (a1) The Account is not owing more than ninety (90) days after the date of the original invoice or other writing evidencing such Account; (b) it is not owing by an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any notea judgment, trade acceptancean Instrument or Chattel Paper or secured by a letter of credit (except (a) such judgment as has been assigned to Creditor, draft (b) such Instrument or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously Chattel Paper as has been endorsed and delivered by Borrower to Lender Creditor and (c) such letter of credit as has been assigned and delivered to Creditor) and represents a bona fide completed transaction; (2) the amount shown on Debtor’s Books and Records and on any list, invoice or statement furnished to Creditor is acceptable owing to Lender;Debtor; (3) the title of Debtor to the Account and, except as against the Purchaser, to any goods represented thereby is absolute; (4) the Account has not been transferred to any other person, and, at the time such Account is created, no person except Debtor has any claim thereto or, with the sole exception of the Purchaser therefor, to the goods represented thereby; and (5) no set-off or counter-claim to such Account exists, and no agreement has been made with any person under which any deduction or discount may be claimed. (fB) it is a validDebtor will promptly, legally enforceable obligation and in any event within thirty (30) days of the creation thereof, notify Creditor if any Eligible Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part arises out of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in contracts with the United States of America or Canada, (ii) is not organized under the laws any state of the United States of AmericaStates, or any state department, agency or instrumentality thereof, or furnish Creditor with copies of each such contract and execute any instruments and take any steps reasonably required by Creditor in order that all moneys due and to become due under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken such contract shall be assigned to comply with Creditor and notice given under the Federal Assignment of Claims Act or any similar statute of 1940, as amended, or with any comparable a state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Accountof the United States. (jC) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtorwill, (ii1) if requested by Creditor, upon the dissolutionoccurrence and during the continuance of an Event of Default, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇▇ Debtor’s records concerning each of its Accounts in a manner satisfactory to Creditor so as to show that each Account has been assigned to Creditor; (2) if requested by Creditor, payable at a future date in accordance furnish Creditor with its terms, subject to a retainage or holdback by satisfactory evidence of the Account Debtor or insured by a surety company; (1) If shipment and receipt of any goods and the Account Debtor is located in either the State performance of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing any services represented by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed Accounts; and (3) furnish Creditor with such other information as Creditor may from time to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Accountreasonably request.

Eligible Accounts. Upon Borrower’s delivery to Lender ELIGIBLE ACCOUNTS" shall mean all Accounts of a Borrowing Base Certificate, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider Borrower other than the following requirements: following: (a) The Account is not owing more than Accounts which remain unpaid as of ninety (90) days (provided that such period shall be 120 days as to those Accounts from Account Debtors listed on annexed SCHEDULE 9.1A, if any, as amended from time to time with the prior written consent of Agent) after the date of the original invoice or other writing evidencing such Account; with respect thereto; (b) it is not all Accounts owing by an a single Account Debtor who has failed to pay Debtor, including a currently scheduled Account, if twenty-five percent (25%) or more of the aggregate amount of its Accounts balance owing to Borrower within ninety (90) days after the date by such Account Debtor is ineligible by reason of the respective invoices or other writings evidencing such Accounts; criterion set forth in CLAUSE (a) of this SECTION 9.1; (c) it arises from the sale of goods and such goods have been shipped or delivered Accounts with respect to which the Account Debtor under such Accountis an Affiliate of Borrower or a director, officer or employee of Borrower or its Affiliates; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered Accounts with respect to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of which the Account Debtor thereunder, and is not subject a Governmental Authority or prime contractor thereof unless Borrower has complied in a manner satisfactory to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply Agent with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state lawsimilar law or statute, if applicableany, of the relevant state, province, municipality or other jurisdiction and all other necessary steps are taken any amendments thereto, relative to perfect Lender’s security interest and collection rights in the assignment of such Account. Accounts; (je) it except as to Accounts from Account Debtors listed on annexed SCHEDULE 9.1B, as amended from time to time with the prior written consent of Agent, Accounts with respect to which the Account Debtor is not owing by an a resident of the United States or Canada (other than the provinces of ▇▇▇▇▇▇ ▇▇▇▇▇▇ Island, Newfoundland and Nova Scotia and the Northwest Territories) unless such Account is payable in United States Dollars and the Account Debtor for which has supplied Borrower has received a notice of with (i) an irrevocable letter of credit, issued by a financial institution satisfactory to Agent, in an amount sufficient to cover such Account and in form and substance satisfactory to Agent and without right of setoff or (ii) foreign credit insurance from an issuer, and in form and substance, satisfactory to Agent in an amount sufficient to cover such Account, and provided Agent has been made the death of loss payee with respect to such insurance pursuant to an endorsement satisfactory in form and substance to Agent; (f) Accounts arising with respect to goods which have not been shipped and delivered to and accepted as satisfactory by the Account Debtor or any partner of arising with respect to services which have not been fully performed and accepted as satisfactory by the Account Debtor, ; (iig) Accounts for which the dissolution, liquidation, termination prospect of existence, insolvency payment in full or business failure performance in a timely manner by the Account Debtor is or is likely to become impaired as determined by Agent in the reasonable exercise of its discretion; (h) Accounts which are not invoiced (and dated as of the date of such invoice) and sent to the Account Debtor within five (5) days after delivery of the underlying goods to or performance of the underlying services for the Account Debtor, ; (iiii) the appointment Accounts with respect to which Agent does not have a first and valid fully perfected Lien free and clear of a receiver for any part of the property of other Lien; (j) Accounts with respect to which the Account Debtor, Debtor is the subject of bankruptcy or (iv) a similar insolvency proceeding or has made an assignment for the benefit of creditors, the filing of creditors or whose assets have been conveyed to a petition in bankruptcy, receiver or the commencement of any proceeding under any bankruptcy or insolvency laws by or against trustee; (k) Accounts with respect to which the Account Debtor; 's obligation to pay the Account is contractually conditional upon the Account Debtor's approval or is otherwise subject to any repurchase obligation or return right (k) it is not an account billed other than reurn rights arising in advancethe ordinary business practice of the Account Debtor), payable as with sales made on deliverya guaranteed sale, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇-and-hold, payable at a future date in accordance with its termssale-or-return, subject to a retainage demonstration, sale on approval or holdback other terms by reason of which the payment by the Account Debtor is or insured may be conditional (except with respect to Accounts in connection with which Account Debtors are entitled to return Inventory solely on the basis of the quality of such Inventory) or consignment basis; (l) Accounts to the extent that the Account Debtor's indebtedness to Borrower exceeds fifteen percent (15%) (provided that such percentage shall be thirty percent (30%) in the case of General Nutrition Center or WalMart) of the lesser of (i) the Revolving Commitment then in effect or (ii) the aggregate Accounts then owing to Borrower; (m) contra Accounts to the extent of the amount of the accounts payable owed by a surety company; Borrower to the Account Debtor; (1n) If Accounts with respect to which the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, or any other state as to which Agent hereafter give Borrower notice that such state denies creditors access to its courts in the absence of a Notice of Business Activities Report or other similar filing, unless Borrower has either qualified as a foreign corporation authorized to transact business in such state or has filed a Notice of Business Activities Report or comparable report similar filing with the applicable Governmental Authority in such state authority for the then current year; ; (mo) it Accounts evidenced by Chattel Paper or any Instrument of any kind, to the extent possession of such Chattel Paper or Instrument is not owing by any Account Debtor whose obligations Lender, acting granted to Agent and (p) Accounts which Agent determines in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease good faith to be an Eligible Accountunacceptable.

Eligible Accounts. Upon Borrower’s delivery to Lender of a Borrowing Base Certificate, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider " shall mean all Accounts other than the following requirements: following: (ai) The Account is not owing more than Accounts which remain unpaid as of ninety (90) days after the date of the original invoice or other writing evidencing such Account; with respect thereto; (bii) it is not all Accounts owing by an a single Account Debtor who has failed to pay twenty-five Debtor, including a currently scheduled Account, if fifty percent (2550%) or more of the aggregate amount of its Accounts balance owing to Borrower within ninety (90) days after the date by such Account Debtor is ineligible by reason of the respective invoices or other writings evidencing such Accounts; criterion set forth in clause (ci) it arises from the sale of goods and such goods have been shipped or delivered this SUBSECTION 3.2; (iii) Accounts with respect to which the Account Debtor under such Accountis an Affiliate of the Borrower or a director, officer or employee of the Borrower or its Affiliates; or it arises from services rendered and such services have been performed; (div) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered Accounts with respect to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of which the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate agency or instrumentality or prime contractor thereof (other instrumentality of any of than military commissaries) unless the foregoing, unless all necessary steps are taken Borrower has complied in a manner satisfactory to comply the Agent with the Federal Assignment of Claims Act of 1940, as amended, or relative to the assignment of such Accounts; (v) Accounts with any comparable state law, if applicable, and all other necessary steps are taken respect to perfect Lender’s security interest and collection rights in such Account. (j) it which the Account Debtor is not owing by an a resident of the United States unless the Account Debtor for has (A) supplied the Borrower with an irrevocable letter of credit, issued by a financial institution satisfactory to the Required Lenders, or (B) obtained foreign credit insurance, in each case in an amount sufficient to cover such Account in form and substance satisfactory to the Agent and without right of setoff and the Account is payable in full in United States dollars; (vi) Accounts arising with respect to goods which Borrower has received a notice of (i) the death of have not been shipped and delivered to and accepted as satisfactory by the Account Debtor or any partner of arising with respect to services which have not been fully performed and accepted as satisfactory by the Account Debtor, ; (iivii) Accounts for which the dissolution, liquidation, termination prospect of existence, insolvency payment in full or business failure performance in a timely manner by the Account Debtor is or is likely to become impaired as determined by the Agent in the exercise of its discretion; (viii) Accounts which are not invoiced (and dated as of the date of such invoice) and sent to the Account Debtor within five (5) days after delivery of the underlying goods to or performance of the underlying services for the Account Debtor; (ix) Accounts with respect to which the Agent, (iii) the appointment of a receiver for any part on behalf of the property Lenders, does not have a first and valid fully perfected Lien, free and clear of any other Lien whatsoever; (x) Accounts with respect to which the Account Debtor, Debtor is the subject of bankruptcy or (iv) a similar insolvency proceeding or has made an assignment for the benefit of creditors, the filing of creditors or whose assets have been conveyed to a petition in bankruptcy, receiver or the commencement of any proceeding under any bankruptcy or insolvency laws by or against trustee; (xi) Accounts with respect to which the Account Debtor; (k) it 's obligation to pay the Account is not an account billed in advanceconditional upon the Account Debtor's approval or is otherwise subject to any repurchase obligation or return right, payable as with sales made on deliverya guaranteed sale, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇-and-hold, payable at sale-or-return, sale on approval (except with respect to Accounts in connection with which Account Debtors are entitled to return Inventory solely on the basis of the quality of such Inventory) or consignment basis; (xii) Accounts to the extent that the Account Debtor's indebtedness to the Borrower exceeds a future date credit limit determined by the Agent in the Agent's discretion following ten (10) Business Days' prior written notice of such credit limit from the Agent to the Borrower; (xiii) Accounts with respect to which any disclosure is required in accordance with its termsSUBSECTION 3.3; (xv) contra Accounts to the extent of the amount of the accounts payable (including, subject to a retainage or holdback without limitation, accrued Slotting Fee Payments) owed by the Borrower to the Account Debtor or insured by a surety company; Debtor; (1xvi) If Accounts with respect to which the Account Debtor is located in any state denying creditors access to its courts in the absence of a Notice of Business Activities Report or other similar filing unless the Borrower has either the State of New Jersey, the State of Minnesota, qualified as a foreign corporation authorized to transact business in such state or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report similar filing with the applicable state authority agency in such state for the then current year; ; (mxvii) it Accounts evidenced by chattel paper or any instrument of any kind, to the extent possession of such chattel paper or instrument is not owing by any Account Debtor whose obligations Lendergranted to the Agent, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more for the benefit of the Lenders; (xviii) Accounts which are the subject of a dispute between the Borrower and an Account Debtor; and (xix) Accounts which the Agent determines in good faith to be unacceptable. In the event that a previously scheduled Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease ceases to be an Eligible AccountAccount under the above described criteria, the Borrower shall notify the Agent thereof.

Eligible Accounts. Upon On any date of determination of the Borrowing Base, all of the Accounts owned by any Borrower’s delivery to Lender of a , as applicable, and reflected in the most recent Borrowing Base CertificateCertificate delivered by the Borrower Representative to the Collateral Agent and the Administrative Agent, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are be “Eligible Accounts”” for the purposes of this Agreement, except any Account to which any of the exclusionary criteria set forth below applies. In making this determination, Lender will consider Eligible Accounts shall not include any of the following requirementsAccounts: (ai) The any Account is not owing more than ninety (90) days after in which the date Collateral Agent, on behalf of the original invoice or other writing evidencing such AccountSecured Parties, does not have a valid perfected First Priority Lien; (bii) it any Account that is not owing owned by a Credit Party; (iii) any Account due from an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it that is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office domiciled in the United States of America or Canada, Canada and (iiif not a natural person) is not organized under the laws of the United States of America, or Canada or any state political subdivision thereof; (iv) any Account that is payable in any currency other than Dollars; (v) any Account that does not arise from the sale of goods or the performance of services by such Credit Party in the ordinary course of its business; (vi) any Account that does not comply with all applicable legal requirements, or under the laws including, without limitation, all laws, rules, regulations and orders of any province Governmental Authority; (vii) any Account which is owed by an Account Debtor located in Canadaany jurisdiction which requires filing of a “Notice of Business Activities Report” or other similar report in order to permit the applicable Borrower to seek judicial enforcement in such jurisdiction of payment of such Account, unless such Borrower (at the time the Account was created and at all times thereafter) (i) has qualified to do business in such jurisdiction and such qualification enables Borrower to seek judicial recourse in such jurisdiction, (ii) had filed and has filed and maintained effective such report with the appropriate office or agency of in such jurisdictions, as applicable, or (iii) is was and has continued to be exempt from filing such report and has provided the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality Collateral Agent with satisfactory evidence thereof; (iviii) it any Account (a) upon which the right of a Borrower, as applicable, to receive payment is not absolute or is contingent upon the fulfillment of any condition whatsoever unless such condition is satisfied or (b) as to which such Borrower is not able to bring suit or otherwise enforce its remedies against the Account Debtor through judicial or administrative process or (c) that represents a progress billing consisting of an invoice for goods sold or used or services rendered pursuant to a contract under which the Account Debtor’s obligation to pay that invoice is subject to a Borrower’s or any Guarantor’s, as applicable, completion of further performance under such contract or is subject to the equitable lien of a surety bond issuer; (ix) to the extent that any defense, counterclaim, setoff or dispute is asserted as to such Account, it being understood that the amount of any such defense, counterclaim, setoff or dispute shall be disclosed to the Collateral Agent and that the remaining balance of the Account shall be eligible; (x) [RESERVED] (xi) any Account with respect to which an invoice or other electronic transmission constituting a request for payment, reasonably acceptable to the Collateral Agent in form and substance, has not been sent on a timely basis to the applicable Account Debtor according to the normal invoicing and timing procedures of a Borrower, as applicable; (xii) any Account that arises from a sale to any director, officer, other employee or Affiliate of any Credit Party, or to any entity that has any common officer or director with any Credit Party; (xiii) to the extent Holdings or any Subsidiary is liable for goods sold or services rendered by the applicable Account Debtor to any Credit Party or any Subsidiary of a Credit Party but only to the extent of the potential offset; (xiv) any Account that arises with respect to goods that are delivered on a b▇▇▇-and-hold, cash-on-delivery basis or placed on consignment, guaranteed sale or other terms by reason of which the payment by the Account Debtor is or may be conditional; (xv) any Account that is in default; provided, that, without limiting the generality of the foregoing, an Account owing by shall be deemed in default upon the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality occurrence of any of the foregoingfollowing: (1) that portion of any Account that is more than sixty (60) days past due according to its original terms of sale or which has been written off or designated as uncollectible by such Borrower (and, for the avoidance of doubt, the remainder of any such Account shall not be in default for purposes hereof unless all Accounts of the applicable Account Debtor are ineligible pursuant to clause (xvi) below); or (2) the Account Debtor obligated upon such Account suspends business, makes a general assignment for the benefit of creditors, has become insolvent, admits in writing its inability to pay its bills as they become due or fails to pay its debts generally as they come due; or (3) a petition is filed by or against any Account Debtor obligated upon such Account under any bankruptcy law or any other federal, state or foreign (including any provincial) receivership, insolvency relief or other law or laws for the relief of debtors; or (4) the payment terms (at inception or as modified from time to time) of any Account are not reasonably satisfactory to the Administrative Agent or Collateral Agent (it being understood that Borrowers’ customary terms as of the Closing Date are satisfactory to the Administrative Agent and the Collateral Agent); (xvi) any Account that is the obligation of an Account Debtor (other than an individual) if 50% or more of the Dollar amount of all Accounts owing by that Account Debtor are ineligible under the other criteria set forth in clause (xv) above; (xvii) any Account as to which any of the representations or warranties in the Loan Documents are untrue; (xviii) to the extent such Account is evidenced by a judgment, Instrument or Chattel Paper; (xix) to the extent (A) the Accounts owing from such Account Debtor and its Affiliates to the Borrowers exceeds 20% of the aggregate of all Eligible Accounts or (B) exceeds any credit limit established by the Collateral Agent, in good faith and in the exercise of reasonable (from the perspective of a secured asset-based lender) business judgment, following prior notice of such limit by the Collateral Agent to the Borrower Representative; (xx) that portion of any Account (1) in respect of which there has been, or should have been, established by a Borrower or any Guarantor a contra account, whether in respect of contractual allowances with respect to such Account, audit adjustment, anticipated discounts or otherwise or (2) which is due from an Account Debtor to whom any Credit Party owes a trade payable, but only to the extent of such trade payable; (xxi) any Account on which the Account Debtor is a Governmental Authority, unless all necessary steps are taken a Credit Party, as applicable, has assigned its rights to comply with payment of such Account to the Federal Administrative Agent pursuant to the Assignment of Claims Act of 1940, as amended, or with any comparable state in the case of a federal Governmental Authority, and pursuant to applicable law, if applicableany, in the case of any other Governmental Authority, and all other necessary steps are taken to perfect Lender’s security interest such assignment has been accepted and collection rights in such Account.acknowledged by the appropriate government officers; or (jxxii) it any Account which is not owing by due from an Account Debtor for which Borrower that has received been structured as note payable or has been restructured as a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Accountnote payable.

Eligible Accounts. Upon The Eligible Accounts are bona fide existing payment obligations created by the sale and delivery of Inventory or the rendition of services to Account Debtors in the ordinary course of Borrower’s delivery 's business, owed to Borrower (net of reserves) without defenses, disputes, offsets, counterclaims, or rights of return or cancellation. As to each Eligible Account, such Account is (1) subject to a valid and perfected first priority security interest in favor of Agent for the benefit of the Lender of a Borrowing Base CertificateGroup, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider the following requirementsand (2) is not: (a) The Account is not owing more than ninety (90) days after the date owed by an employee, Affiliate, or agent of the original invoice or other writing evidencing such Account;any Obligor, (b) it is not owing on account of a transaction wherein goods were placed on consignment or were sold pursuant to a guaranteed sale, a sale or return, a sale on approval, a ▇▇▇▇ and hold, or on any other terms by an reason of which the payment by the Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts;may be conditional, (c) it arises payable in a currency other than Dollars, except for Accounts owed by British Telecom (and any other Account Debtor located in Great Britain approved in writing by Agent in its Permitted Discretion) that are payable in British pounds sterling and converted at Borrower's cost into Dollars pursuant to a Permitted F/X Contract, (d) an Account arising from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender;prepaid calling cards, (e) it is an Account with respect to which the telecommunications services giving rise to such Account have not evidenced been provided to and utilized by the Account Debtor, or any noteservices giving rise to such Account have not been performed, trade acceptanceconsumed, draft or other negotiable instrument utilized by the Account Debtor, or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender;the Account does not otherwise represent a final sale, (f) it is a valid, legally enforceable obligation of an Account that has not yet been billed to the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part;Debtor, (g) it is not subject an Account with respect to any sale which the applicable Borrower received from the Account Debtor a customer deposit, to the extent of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller;such customer deposit, (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an LEC Account Debtor which (i) does that is not maintain its chief executive office covered by a LEC Confirmation Statement received by the applicable Borrower from the applicable LEC or an Approved Billing Agent in the United States respect of America such LEC, or Canada, (ii) that is not organized under covered by a LEC Confirmation Statement received by the laws applicable Borrower from the applicable LEC or an Approved Billing Agent in respect of such LEC to the United States extent of America, (without duplication) reductions of or any state thereof, offsets against amounts otherwise payable with respect thereto by reason of up-front LEC rejects or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof;credits deducted from net confirmed revenues on such LEC Confirmation Statement, (i) it is not an Account owing by with respect to which any commissions are owed to any Persons, to the extent of such commissions, (j) an Account that has been transferred to an Obligor's legal or collection department, (k) an Account with respect to which the Account Debtor is either (i) the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any the United States (exclusive, however, of Accounts with respect to which Borrower has complied, to the foregoingreasonable satisfaction of Agent, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940Act, as amended31 U.S.C. Section 3727), or with (ii) any comparable state lawState of the United States (exclusive, if applicablehowever, and all other necessary steps are taken of Accounts owed by any State that does not have a statutory counterpart to perfect Lender’s security interest and collection rights in such Account.the Assignment of Claims Act), (jl) it is not owing by an Account Debtor for with respect to which Borrower has received a notice of (i) the death of the Account Debtor is a creditor of Borrower, has or has asserted a right of setoff, has disputed its liability, or has made any partner claim with respect to the Account, to the extent of such claim, right of offset, assertion, or dispute, (m) an Account with respect to which, to the Obligors' knowledge, the Account Debtor is subject to an Insolvency Proceeding, is not Solvent, or is going or has gone out of business, (n) an Account the collection of which Borrower reasonably believes to be doubtful by reason of the Account Debtor's financial condition, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor;and (ko) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for a right to receive progress payments or other advance ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject ▇ that are due prior to a retainage or holdback the completion of performance by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria subject contract for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Accountgoods or services.

Eligible Accounts. Upon Borrower’s delivery to Lender of a Borrowing Base Certificate, Lender Eligible Accounts shall determine, in its reasonable discretion, which mean all Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider other than the following requirementsfollowing: (aA) The Account is not owing more than ninety Accounts which remain due one hundred and fifty (90150) days after past the date of the original invoice or other writing evidencing such Accountdate; (bB) it is not International Accounts (except those International Accounts which Lender deems to be eligible, in Lenders role and absolute discretion); (C) Accounts owing by an a single Account Debtor who has failed to pay twenty-five Debtor, including a currently scheduled Account, if fifty percent (2550%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date balance owning by such Account Debtor is ineligible by reason of the respective invoices criterion set forth in clause (A) or other writings evidencing such Accounts(B) above; (cD) it arises from the sale of goods and such goods have been shipped or delivered Accounts with respect to which the Account Debtor under such Account; is an Affiliate of Borrower or it arises from services rendered and such services have been performeda director, officer or employee of Borrower or its Affiliates; (dE) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered Accounts with respect to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of which the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate agency or other instrumentality of any of the foregoing, thereof unless all necessary steps are taken to comply Borrower has complied with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account.; (jF) it is Accounts arising with respect to goods which have not owing by an Account Debtor for which Borrower has received a notice of (i) the death of been shipped and delivered to the Account Debtor or any partner of arising with respect to services which have not been fully performed and accepted by the Account Debtor, ; (iiG) the dissolution, liquidation, termination of existence, insolvency or business failure of Accounts with respect to which the Account Debtor, (iii) Debtor is the appointment subject of bankruptcy or a receiver for any part of the property of the Account Debtor, similar insolvency proceeding or (iv) has made an assignment for the benefit of creditors, the filing of creditors or whose assets have been conveyed to a petition in bankruptcy, receiver or the commencement of any proceeding under any bankruptcy or insolvency laws by or against trustee; (H) Accounts with respect to which the Account Debtor's obligations to pay the Account is conditional upon the Account Debtor's approval or is otherwise subject to any repurchase obligation or return right, as with sales made on a guaranteed sale, sale-and-return, sale on approval, or consignment basis (except with respect to Accounts in connection with which Account Debtors are entitled to return Inventory solely on the basis of the quality of such Inventory); (kI) it is Accounts which are not evidenced by chattel paper or an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by instrument of any kind; (J) Accounts where the Account Debtor has an outstanding credit for the prior account period or insured by a surety companyhas asserted any offset, counterclaim or defense denying liability thereunder; provided, however, that if such credit, offset, counterclaim or defense has been asserted, such Account shall be ineligible only to the extent of such asserted credit, offset, counterclaim or defense; (1K) Accounts which are not subject to and covered by Lender's first priority perfected security interest and which are subject to any other lien, claim, encumbrance or security interest; (L) Accounts which are not evidenced by an invoice or other documentation in form acceptable to Lender; (M) If the Account Debtor is located in either the State of New Jersey, the State all Accounts of Minnesota, or the State of Indiana, such Account Debtor unless Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority New Jersey Division of Taxation for the then current year; (mN) it If the Account Debtor is located in the State of Minnesota, all Accounts of such Account Debtor unless Borrower has filed a Business Activity Report with the Minnesota Department of Revenue; (O) Any Account unless each of the warranties and representations set forth in Section 9.2 has been reaffirmed with respect to such individual Account at the time that the most recent Accounts Report was delivered to Lender; (P) Accounts against which Lender is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower legally permitted to make loans and advances; and (Q) Accounts which are not deemed to constitute Eligible Accounts. For purposes of determining eligibilitya valid, should twenty percent (20%) or more legally enforceable obligation of the Eligible Accounts be due and owing from any one relevant Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible AccountDebtor.

Eligible Accounts. Upon Borrower’s delivery to Lender of a Borrowing Base Certificate, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination" shall mean all Accounts of each of the Borrowers other than the following: (i) except as provided in subsection 3.2(vi), Lender will consider the following requirements: (a) The Account is not owing more than Accounts which remain unpaid as of ninety (90) days after the date of the original invoice or other writing evidencing such Account; with respect thereto; (bii) it is not all Accounts owing by an a single Account Debtor who has failed to pay twenty-five Debtor, including a currently scheduled Account, if fifty percent (2550%) or more of the aggregate amount of its Accounts balance owing to Borrower within ninety (90) days after the date by such Account Debtor is ineligible by reason of the respective invoices or other writings evidencing such Accounts; criterion set forth in clause (ci) it arises from the sale of goods and such goods have been shipped or delivered this subsection 3.2; (iii) Accounts with respect to which the Account Debtor under such Accountis an Affiliate of any Borrower or a director, officer or employee of any Borrower or its Affiliates; or it arises from services rendered and such services have been performed; (div) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered Accounts with respect to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of which the Account Debtor thereunder, and is not subject a Governmental Authority or prime contractor thereof unless such Borrower has complied in a manner satisfactory to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply Agent with the Federal Assignment of Claims Act of 1940, as amended, or similar law or statute of the relevant state, province, municipality or other jurisdiction and any amendments thereto, relative to the assignment of such Accounts; (v) Accounts with any comparable state law, if applicable, and all other necessary steps are taken respect to perfect Lender’s security interest and collection rights in such Account. (j) it which the Account Debtor is not owing by an a resident of the United States unless the Account is payable in United States dollars and (A) the Account Debtor for which has supplied such Borrower has received with an irrevocable letter of credit, issued by a notice financial institution satisfactory to the Required Lenders in an amount sufficient to cover such Account and in form and substance satisfactory to the Required Lenders and without right of setoff or (iB) the death of Agent in its reasonable discretion has approved in writing such Account Debtor; (vi) Prebilled Accounts and other Accounts arising with respect to goods which have not been shipped and delivered to and accepted as satisfactory by the Account Debtor or any partner of arising with respect to services which have not been fully performed and accepted as satisfactory by the Account Debtor, ; (iivii) Accounts for which the dissolution, liquidation, termination prospect of existence, insolvency payment in full or business failure performance in a timely manner by the Account Debtor is or is likely to become impaired as determined by the Agent in the reasonable exercise of its discretion; (viii) Accounts which are not invoiced (and dated as of the date of such invoice) and sent to the Account Debtor within thirty (30) days after delivery of the underlying goods to or performance of the underlying services for the Account Debtor; (ix) Accounts with respect to which the Agent, (iii) the appointment of a receiver for any part on behalf of the property Lenders, does not have a first and valid fully perfected Lien free and clear of any other Lien whatsoever; (x) Accounts with respect to which the Account Debtor, Debtor is the subject of bankruptcy or (iv) a similar insolvency proceeding or has made an assignment for the benefit of creditors, the filing of creditors or whose assets have been conveyed to a petition in bankruptcy, receiver or the commencement of any proceeding under any bankruptcy or insolvency laws by or against trustee; (xi) Accounts with respect to which the Account Debtor; (k) it 's obligation to pay the Account is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, conditional upon the Account Debtor's approval or is otherwise subject to any repurchase obligation or return right, as with sales made on a retainage guaranteed sale, sale-or-return, demonstration, sale on approval or holdback other terms by reason of which the payment by the Account Debtor is or insured may be conditional (except with respect to Accounts in connection with which Account Debtors are entitled to return Inventory solely on the basis of the quality of such Inventory) or consignment basis; (xii) Accounts to the extent that the Account Debtor's indebtedness to the Borrowers exceeds a credit limit determined by a surety company; the Agent in the Agent's discretion following prior written notice of such credit limit from the Agent to the Borrower Representative; (1xiii) If Accounts with respect to which any disclosure is required in accordance with subsection 3.3; (xiv) contra Accounts to the extent of the amount of the accounts payable owed by the Borrowers to the Account Debtor; (xv) Accounts with respect to which the Account Debtor is located in any state denying creditors access to its courts in the absence of a Notice of Business Activities Report or other similar filing unless such Borrower has either the State of New Jersey, the State of Minnesota, qualified as a foreign corporation authorized to transact business in such state or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report similar filing with the applicable Governmental Authority in such state authority for the then current year; ; (mxvi) it Accounts evidenced by Chattel Paper or any Instrument of any kind, to the extent possession of such Chattel Paper or Instrument is not owing by any Account Debtor whose obligations Lendergranted to the Agent, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more for the benefit of the Lenders; and (xvii) Accounts which the Agent determines in good faith to be unacceptable. In the event that a previously scheduled Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease ceases to be an Eligible AccountAccount under the above described criteria (other than any determination made by the Agent), the Borrower Representative shall notify the Agent thereof as soon as practicable.

Eligible Accounts. Upon Borrower’s delivery As to Lender of each Account that is identified by the Borrower as an Eligible Account in a Borrowing Base CertificateCertificate submitted to the Administrative Agent, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider the following requirementssuch Account is: (a) The Account is not owing more than ninety (90) days after the date of the original invoice or other writing evidencing such Accountgenuine and in all material respects what it purports to be; (b) it is not owing by an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable bona fide existing payment obligation of the Account Debtor thereunder, created by the completed sale and is not subject delivery of Inventory or the rendition of services to any offset, counterclaim or other defense on the part of such Account Debtor in the ordinary course of the Borrower’s business, and substantially in accordance with any purchase order, contract or to any claim on the part of such Account Debtor denying liability thereunder in whole or in partother document relating thereto; (gi) it is not subject owed to the Borrower without any sale of accountsknown defenses, any disputes, offsets, counterclaims, or rights of offset, assignment, lien return or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canadacancellation, (ii) is not organized under subject to any extension, modification, deduction, discount or return that has been authorized or which is in process with respect to such Account (except discounts or allowances granted in the laws ordinary course of the United States of America, or any state thereof, or under Borrower’s business for prompt payment that are reflected on the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any face of the foregoing, unless all necessary steps are taken invoice related thereto and in the reports submitted to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress Administrative Agent ▇▇▇▇▇▇▇▇▇), payable at a future date in accordance with its terms, subject to a retainage and (iii) the Borrower is shown as the sole payee or holdback by the Account Debtor or insured by a surety companyremittance party on each applicable invoice; (1d) If for a sum certain, maturing as stated in any applicable invoice, a copy of which has been furnished to the Account Debtor Administrative Agent or is located in either available to the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current yearAdministrative Agent on request; (me) it not subject to any terms in a purchase order, agreement, document or Applicable Law that restricts assignment of the Account to the Administrative Agent or the Collateral Agent (regardless of whether, under the Uniform Commercial Code, the restriction is ineffective); (f) not owing excluded as ineligible by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes virtue of determining eligibility, should twenty percent (20%) one or more of the excluding criteria (other than any Administrative Agent-discretionary criteria) set forth in the definition of Eligible Accounts be due and owing from any one Accounts; and (g) to the Borrowers’ knowledge, (i) there are no facts or circumstances that are reasonably likely to impair the enforceability or collectability of such Account; (ii) the Account Debtor at any timehad the capacity to contract when the Account arose, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails continues to meet the Borrower’s customary credit standards, is Solvent, is not contemplating or subject to an Insolvency Proceeding, and has not failed, or suspended or ceased doing business; and (iii) there are no proceedings or actions threatened or pending against any of Account Debtor that could, individually or in the foregoing requirementsaggregate, shall forthwith cease reasonably be expected to be an Eligible Accounthave a material adverse effect on the Account Debtor’s financial condition.

Eligible Accounts. Upon Borrower’s delivery to Lender To be an Eligible Account, an Account must meet all of a Borrowing Base Certificate, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider the following requirements: requirements and conditions, unless waived in writing by Purchaser: (a) The the Account has not been deemed unacceptable by Purchaser in its discretion; (b) Seller has sole and unconditional title to the Account, and the Account and any goods sold or services provided to create the Account are free and clear of any lien, claim, charge, security interest, or other encumbrance of any kind; (c) all goods sold or services provided to create the Account have been sold or provided in the ordinary course of Seller’s business and in accordance with all applicable laws, rules, regulations, and ordinances; (d) the Account is a valid, genuine, and enforceable obligation of the Account Debtor as specified on the records and invoices of Seller; (e) there are no payments, deductions, credits, discounts, payment terms, or other modifications or reductions in the amount owing on the Account, except as disclosed in writing to Purchaser prior to Purchase; (f) there have been no extensions, modifications, or other agreements relating to payment of the Account, except as disclosed in writing to Purchaser prior to Purchase; (g) there are no defenses, setoffs, or counterclaims to payment of the Account that can be asserted against Seller or Purchaser; (h) the Account has been submitted to Purchaser no later than seven (7) days from the date the goods are sold or delivered, giving rise to the Account are completed, except that Accounts customarily billed in the aggregate may be submitted no later than twenty-one (21) days from the date the goods are sold or delivered, giving rise to the Account are completed; (i) the Account is free of all disputes by the Account Debtor; (j) the Account is not owing more than ninety by any Person to which Seller is indebted; (90k) days after the date Account is not owing by an employee, agent, officer, or director of Seller; (l) the Account is not owing by a parent, subsidiary, sister company, or other company related to or anyhow affiliated with Seller; (m) the Account Debtor has a credit rating satisfactory to Purchaser and the Account Debtor is located or authorized to do business in the United States; (n) no proceeding has been commenced or petition filed under any bankruptcy or insolvency law by or against the Account Debtor; (o) no receiver, trustee, or custodian has been appointed for any part of the original invoice property of the Account Debtor, and no property of the Account Debtor has been assigned for the benefit of creditors; (p) neither the Account nor any invoice, credit application, ▇▇▇▇, billing memorandum, correspondence, or any other document evidencing the Account provides for the collection of any payment in excess of the maximum amount allowed by usury or other writing evidencing such Account; applicable law; (bq) it the Account is not beyond the Late Payment Date; (r) the Account is not owing by an Account Debtor who has failed to pay with twenty-five percent (25%) or more of Outstanding Purchases past the aggregate amount Late Payment Date; (s) if Outstanding Purchases for an Account Debtor equal or exceed the Concentration Percentage times the Outstanding Purchases for all Account Debtors, then the portion of its Purchased Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence in excess of billing acceptable to Lender; such Concentration Percentage are not Eligible Accounts; (et) it is not the Account will be evidenced by any noteone or more legible Invoices having at a minimum and without limitation, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or CanadaSeller’s name, (ii) is not organized under the laws of the United States of Americaan Invoice number, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign stateInvoice Date, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (iiv) the death of the Account Debtor or any partner name and address of the Account Debtor, (iiv) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtoramount owing, (iiivi) the appointment of P.O. Box, (vii) a receiver for any part of the property of the Account Debtor, or (iv) an assignment due date for the benefit of creditorsamount owing, (viii) if applicable, the filing of a petition in bankruptcypurchase order or load number, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; and (kix) it is not an account billed in advancesuch other documentation, payable on deliveryincluding, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jerseywithout limitation, the State of Minnesotaoriginal Invoice, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing as may be required by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible AccountPurchaser.

Eligible Accounts. Upon Borrower’s The Eligible Accounts of each Obligor are bona fide existing payment obligations of Account Debtors created by the sale and delivery of Inventory or the rendition of services to Lender such Obligor's customers in the ordinary course of a Borrowing Base Certificatesuch Obligor's business, Lender shall determineowed to such Obligor without defenses, in its reasonable discretiondisputes, offsets, counterclaims, or rights of return or cancellation. Any goods giving rise to such Eligible Accounts have been delivered to the customer, or to the customer's agent for immediate shipment to and unconditional acceptance by the customer, and any services giving rise to such Eligible Accounts have been fully performed. As to each Eligible Account (which Accounts listed thereon are “Eligible Accounts”. In making this determinationterm includes that portion of an Account deemed eligible), Lender will consider such right to payment is not, unless an exception to any of the following requirementshas been consented to in writing by Agent: (a) The Account is not owing more than ninety (90) days after the date owed by an employee, Affiliate, or agent of the original invoice or other writing evidencing such Account;an Obligor, (b) it is not owing on account of a transaction wherein goods were placed on consignment or were sold pursuant to a guaranteed sale, a sale or return, a sale on approval, a ▇▇▇▇ and hold, or on any other terms by reason of which the payment by the Account Debtor may be conditional, (c) payable, with respect to Eligible Borrower Accounts, in a currency other than Dollars, and, with respect to Eligible UK Sub Accounts, in a currency other than in an Agreed Currency, (d) owed by an Account Debtor who that has failed or has asserted a right of setoff, has disputed its liability, or has made any claim with respect to pay twenty-five percent (25%) or more of its obligation to honor the aggregate amount of its Accounts owing applicable Obligor's right to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered payment, to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part extent of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accountsclaim, any rights right of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of Americaassertion, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Account.dispute,

Eligible Accounts. Upon Borrower’s delivery to Lender On any date of determination of the Borrowing Base, all of the Accounts owned by a Borrower and reflected in the most recent Borrowing Base Certificate, Lender Certificate delivered by the Borrowers to the Collateral Agent and the Administrative Agent shall determine, in its reasonable discretion, which Accounts listed thereon are be “Eligible Accounts”” for the purposes of this Agreement, except any Account to which any of the exclusionary criteria set forth below applies. In making this determination, Lender will consider Eligible Accounts shall not include any of the following requirementsAccounts: (ai) The any Account is not owing more than ninety (90) days after in which the date Collateral Agent, on behalf of the original invoice or other writing evidencing such AccountSecured Parties, does not have a valid, perfected First Priority Lien; (bii) it any Account that is not owing owned by a Borrower; (iii) any Account due from an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it that is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office domiciled in the United States of America or Canada, Canada and (iiif not a natural person) is not organized under the laws of the United States of America, or any state political subdivision thereof, unless such Account is fully-secured by a commercial letter of credit in form and substance acceptable to the Collateral Agent; (iv) any Account that is payable in any currency other than Dollars; (v) any Account that does not arise from the sale of goods or under the laws performance of services by a Borrower in the ordinary course of its business; (vi) any Account that does not comply with all applicable legal requirements, including, without limitation, all laws, rules, regulations and orders of any province Governmental Authority (including any Account due from an Account Debtor located in Canadaa jurisdiction which requires that a Borrower, as applicable, register as a foreign organization, unless such Borrower (at the time the Account was created and at all times thereafter) (i) had filed and has maintained effective a current notice of business activities report with the appropriate office or agency in any such jurisdiction which requires that such Borrower register as a foreign organization, or (iiiii) was and has continued to be exempt from filing such report and has provided the Lenders with satisfactory evidence thereof); (vii) any Account (a) upon which the right of a Borrower to receive payment is not absolute or is contingent upon the government fulfillment of any foreign country condition whatsoever unless such condition is satisfied or sovereign state(b) as to which a Borrower is not able to bring suit or otherwise enforce its remedies against the Account Debtor through judicial or administrative process or (c) that represents a progress billing consisting of an invoice for goods sold or used or services rendered pursuant to a contract under which the Account Debtor’s obligation to pay that invoice is subject to a Borrower’s completion of further performance under such contract or is subject to the equitable lien of a surety bond issuer; (viii) to the extent that any defense, counterclaim, setoff or dispute is asserted as to such Account, it being understood that the amount of any statesuch defense, provincecounterclaim, municipality setoff or dispute shall be disclosed to the Collateral Agent and that the remaining balance of the Account shall be eligible; (ix) any Account that is not a true and correct statement of bona fide indebtedness incurred in the amount of the Account for merchandise sold to or services rendered and accepted by the applicable Account Debtor; (x) any Account with respect to which an invoice or other instrumentality thereofelectronic transmission constituting a request for payment, reasonably acceptable to the Collateral Agent in form and substance, has not been sent on a timely basis to the applicable Account Debtor according to the normal invoicing and timing procedures of a Borrower; (xi) any Account that arises from a sale to any director, officer, other employee or Affiliate of a Borrower; (xii) any Account that arises with respect to goods that are delivered on a ▇▇▇▇-and-hold, cash-on-delivery basis or while placed on consignment, guaranteed sale or other terms by reason of which the payment by the Account Debtor is or may be conditional; (xiii) any Account that is in default; provided, that, without limiting the generality of the foregoing, an Account shall be deemed in default upon the occurrence of any of the following: (i) it any Account (A) not paid within one hundred and twenty (120) days following its original invoice date or (B) that is not more than forty five (45) days past due according to its original terms of sale; or (ii) the Account Debtor obligated upon such Account suspends business, makes a general assignment for the benefit of creditors or fails to pay its debts generally as they come due; or (iii) a petition is filed by or against any Account Debtor obligated upon such Account under any bankruptcy law or any other federal, state or foreign (including any provincial) receivership, insolvency relief or other law or laws for the relief of debtors, provided that the Collateral Agent, in its sole discretion, may decide to include any such Account described in this subsection (iii) as an Eligible Account; (xiv) any Account that is the obligation of an Account Debtor (other than an individual) if 50% or more of the Dollar amount of all Accounts owing by that Account Debtor are ineligible under the United States of America or other criteria set forth in this Section 2.18; (xv) any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of Account as to which any of the foregoingrepresentations or warranties in the Loan Documents are untrue; (xvi) to the extent such Account is evidenced by a judgment, Instrument or Chattel Paper; (xvii) to the extent such Account exceeds any credit limit established by the Collateral Agent, in its Permitted Discretion, following prior notice of such limit by the Collateral Agent to the Borrower; (xviii) that portion of any Account (1) in respect of which there has been, or should have been, established by a Borrower a contra account, whether in respect of contractual allowances with respect to such Account, audit adjustment, anticipated discounts or otherwise, or (2) which is due from an Account Debtor to whom a Borrower owes a trade payable, but only to the extent of such trade payable or (3) which a Borrower knows is subject to the exercise by an Account Debtor of any right of recession, set-off, recoupment, counterclaim or defense; or (xix) any Account on which the Account Debtor is a Governmental Authority, unless all necessary steps are taken a Borrower has assigned its rights to comply with payment of such Account to the Federal Administrative Agent pursuant to the Assignment of Claims Act of 1940, as amended, or with any comparable state in the case of a federal Governmental Authority, and pursuant to applicable law, if applicableany, in the case of any other Governmental Authority, and all other necessary steps are taken to perfect Lender’s security interest such assignment has been accepted and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback acknowledged by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Accountappropriate government officers.

Eligible Accounts. Upon Borrower’s delivery to Lender All Accounts of a Borrowing Base Certificate, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider Borrower meeting all of the following requirements: specifications: (ai) The the Account is lawfully and exclusively owned by Borrower and subject to no Lien (other than Permitted Liens, if applicable, and Liens granted under this Agreement) and Borrower has the right of assignment thereof and the power to grant a security interest therein; (ii) the Account is valid and enforceable representing the undisputed indebtedness of an Account Debtor not owing more than ninety (90) days after the date of past the original invoice or other writing evidencing such Account; date and does not represent a rebilling; (biii) it is not more than 50% of the aggregate balance of all Accounts owing by from an Account Debtor who has failed to pay twenty-five percent (25%) or obligated on the Account are outstanding more of the aggregate amount of its Accounts owing to Borrower within than ninety (90) days after past their original invoice dates (excluding Accounts arising under Prime Government Contracts); (iv) the date Account is not subject to any asserted defense, set-off, or counterclaim, deduction, discount, credit, chargeback, freight claim, allowance or adjustment of any kind; (v) the respective invoices Account is net of any portion thereof attributable to the sale of goods that have been returned, rejected, lost or other writings evidencing such Accounts; damaged; (cvi) it if the Account arises from the sale of goods by Borrower, such sale was an absolute sale and not on consignment or on approval or on a sale-or-return basis nor subject to any other repurchase or return agreement, and such goods have been shipped or delivered to the Account Debtor under such Accountor its designee; or it (vii) if the Account arises from services rendered and the performance of services, such services have actually been performed; ; (dviii) it is evidenced by an invoicethe Account arose in the ordinary course of Borrower’s business; (ix) no notice of the bankruptcy, dated not later than the date of shipment receivership, reorganization, liquidation, dissolution, or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation insolvency of the Account Debtor thereunderhas been received by Lender or Borrower; (x) the Account is an Account for which ▇▇▇▇▇▇ believes that the validity, and enforceability or collection of the Account is not subject to any offset, counterclaim invalid or other defense on otherwise impaired; (xi) the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject a Subsidiary or Affiliate of any Borrower; (xii) the sale does not represent a sale pursuant to any sale a Prime Government Contract unless Borrower has complied, for the benefit of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, if required hereunder or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing requested by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by ; (xiii) the Account is not an Account of an Account Debtor having its principal place of business or insured executive office outside the United States, unless the payment of such Account is guaranteed by a surety company; an irrevocable letter of credit or credit insurance in each case reasonably satisfactory to Lender; (1xiv) If the Account is not an Account on which the Account Debtor is located obligated to Borrower under any Instrument; (xv) the transaction which gave rise to the Account complies in either all material respects ​ with all applicable laws, rules and regulations of any Governmental Authority; and (xvi) the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing Account meets such other reasonable specifications and requirements which may from time to time be established by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute . Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligibleinclude At-Risk Work, regardless cost overruns, progress payments, costs incurred in excess of whether such approved or allowed billing rates, rebillings or retainages, Accounts otherwise satisfy arising out of a contract under which the criteria performance of Borrower is guaranteed by a surety bond, any account receivable pursuant to which payment of any portion thereof is assigned to or for eligibility set forth abovethe benefit of a subcontractor, either directly or pursuant to an escrow arrangement, or that portion of an Account representing interest or finance charges for past due balances or debit memos. ​ Eligible Commercial Account - An Eligible Account which that is at any time not an Eligible Government Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Account.. ​

Eligible Accounts. Upon Borrower’s 's delivery to Lender of a Borrowing Base CertificateDaily Collateral Report, Lender shall determine, in its reasonable discretion, determine which individual Accounts listed thereon are “Eligible Accounts”. In making Unless otherwise agreed to by Lender in writing and except as specifically set forth in the proviso at the end of this determinationSection 3.1, Eligible Accounts shall be (i) Accounts of Borrower, (ii) to the extent Lender will consider has a first priority perfected security interest therein, Accounts of J.R.S. Exploration Company, Ltd., and (iii) to the extent owing by PEMEX, Accounts of Geoevaluaciones, S.A. de C.V., and Procesos Interactivos, S.A. de C.V., and shall in each case and at all times be subject to the following requirements: requirements for eligibility: (aA) If the Account arises from the sale of goods, such goods shall have been shipped or delivered on open account and on an absolute sale basis and not on consignment, on approval or on a sale-or-return basis and shall not be subject to any other repurchase or return agreement and no material part of such goods shall have been returned, repossessed, rejected, lost or damaged; (B) Except as specifically set forth in the proviso at the end of this Section 3.1, if the Account arises from the performance of services, such services shall have been performed in full; (C) The Account shall not be evidenced by chattel paper or an instrument of any kind; (D) The Account Debtor obligated on such Account shall not be suspended from doing business, insolvent or the subject of any bankruptcy or insolvency proceeding of any kind, or the subject of an assignment for the benefit of creditors, or have had a receiver or trustee appointed for a significant portion of its assets, and Lender shall be satisfied with the creditworthiness of such Account Debtor; (E) The Account Debtor obligated on such Account shall not be a supplier to or creditor of Borrower, except to the extent that the aggregate of such Account Debtor's Accounts exceeds Borrower's liabilities (including contingent liabilities) to such Account Debtor; (F) Except as specifically set forth in the proviso at the end of this Section 3.1, if the Account is owing from an Account Debtor located outside the United States or Canada (unless the Account Debtor is PEMEX), such Account Debtor shall have furnished Borrower with an irrevocable letter of credit issued or confirmed by a financial institution acceptable to Lender, which letter of credit shall be in form and substance acceptable to Lender, pledged to Lender, and be payable in Dollars in an amount not less than the face value of the Account; (G) The Account shall be a valid, legally enforceable obligation of the Account Debtor, reduced by the amount of any offset, counterclaim or defense denying liability thereunder asserted in writing by such Account Debtor; (H) The Account shall be subject to and covered by Lender's perfected security interest and shall not be subject to any other lien, claim, encumbrance or security interest; (i)The Account shall be evidenced by an invoice or other documentation in form acceptable to Lender; (J) The Account shall not have remained unpaid for a period exceeding ninety (90) days after the original invoice date of the related invoice and not more than fifty percent (50%) of the balance of all Accounts owing from the Account Debtor obligated under such Account shall have remained unpaid for more than ninety (90) days after the invoice date of the original invoice or other writing evidencing such Account; (b) it is not owing by an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective related invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts otherwise be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Account.deemed

Eligible Accounts. Upon On any date of determination of the Borrowing Base, all of the Accounts owned by any Borrower’s delivery to Lender of a , as applicable, and reflected in the most recent Borrowing Base CertificateCertificate delivered by the Borrower Representative to the Collateral Agent and the Administrative Agent, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are be “Eligible Accounts”” for the purposes of this Agreement, except any Account to which any of the exclusionary criteria set forth below applies. In making this determination, Lender will consider Eligible Accounts shall not include any of the following requirementsAccounts: (ai) The any Account is not owing more than ninety (90) days after in which the date Collateral Agent, on behalf of the original invoice or other writing evidencing such AccountSecured Parties, does not have a valid perfected First Priority Lien; (bii) it any Account that is not owing owned by a Credit Party; (iii) any Account due from an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it that is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office domiciled in the United States of America or Canada, Canada and (iiif not a natural person) is not organized under the laws of the United States of America, or Canada or any state political subdivision thereof, in each case unless such Account is backed by a letter of credit or under bankers acceptance that is acceptable to the laws Administrative Agent and that is in the possession of, has been assigned to and is drawable directly by the Administrative Agent; (iv) any Account that is payable in any currency other than Dollars; (v) any Account that does not arise from the sale of goods or the performance of services by such Credit Party in the ordinary course of its business; (vi) any Account that does not comply with all applicable legal requirements, including, without limitation, all laws, rules, regulations and orders of any province Governmental Authority; (vii) any Account which is owed by an Account Debtor located in Canadaany jurisdiction which requires filing of a “Notice of Business Activities Report” or other similar report in order to permit the applicable Borrower to seek judicial enforcement in such jurisdiction of payment of such Account, unless such Borrower (at the time the Account was created and at all times thereafter) (i) has qualified to do business in such jurisdiction and such qualification enables Borrower to seek judicial recourse in such jurisdiction, (ii) had filed and has filed and maintained effective such report with the appropriate office or agency of in such jurisdictions, as applicable, or (iii) is was and has continued to be exempt from filing such report and has provided the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality Collateral Agent with satisfactory evidence thereof; (iviii) it any Account (a) upon which the right of a Borrower, as applicable, to receive payment is not absolute or is contingent upon the fulfillment of any condition whatsoever unless such condition is satisfied or (b) as to which such Borrower is not able to bring suit or otherwise enforce its remedies against the Account Debtor through judicial or administrative process or (c) that represents a progress billing consisting of an invoice for goods sold or used or services rendered pursuant to a contract under which the Account Debtor’s obligation to pay that invoice is subject to a Borrower’s or any Guarantor’s, as applicable, completion of further performance under such contract or is subject to the equitable lien of a surety bond issuer; (ix) to the extent that any defense, counterclaim, setoff or dispute is asserted as to such Account, it being understood that the amount of any such defense, counterclaim, setoff or dispute shall be disclosed to the Collateral Agent and that the remaining balance of the Account shall be eligible; (x) [RESERVED] (xi) any Account with respect to which an invoice or other electronic transmission constituting a request for payment, reasonably acceptable to the Collateral Agent in form and substance, has not been sent on a timely basis to the applicable Account Debtor according to the normal invoicing and timing procedures of a Borrower, as applicable; (xii) any Account that arises from a sale to any director, officer, other employee or Affiliate of any Credit Party, or to any entity that has any common officer or director with any Credit Party; (xiii) to the extent Holdings or any Subsidiary is liable for goods sold or services rendered by the applicable Account Debtor to any Credit Party or any Subsidiary of a Credit Party but only to the extent of the potential offset; (xiv) any Account that arises with respect to goods that are delivered on a ▇▇▇▇-and-hold, cash-on-delivery basis or placed on consignment, guaranteed sale or other terms by reason of which the payment by the Account Debtor is or may be conditional; (xv) any Account that is in default; provided, that, without limiting the generality of the foregoing, an Account owing by shall be deemed in default upon the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality occurrence of any of the foregoingfollowing: (1) that portion of any Account that is more than sixty (60) days past due according to its original terms of sale or which has been written off or designated as uncollectible by such Borrower (and, for the avoidance of doubt, the remainder of any such Account shall not be in default for purposes hereof unless all Accounts of the applicable Account Debtor are ineligible pursuant to clause (xvi) below); or (2) the Account Debtor obligated upon such Account suspends business, makes a general assignment for the benefit of creditors, has become insolvent, admits in writing its inability to pay its bills as they become due or fails to pay its debts generally as they come due; or (3) a petition is filed by or against any Account Debtor obligated upon such Account under any bankruptcy law or any other federal, state or foreign (including any provincial) receivership, insolvency relief or other law or laws for the relief of debtors; or (4) the payment terms (at inception or as modified from time to time) of any Account are not reasonably satisfactory to the Administrative Agent or Collateral Agent (it being understood that Borrowers’ customary terms as of the Closing Date are satisfactory to the Administrative Agent and the Collateral Agent); (xvi) any Account that is the obligation of an Account Debtor (other than an individual) if 50% or more of the Dollar amount of all Accounts owing by that Account Debtor are ineligible under the other criteria set forth in clause (xv) above; (xvii) any Account as to which any of the representations or warranties in the Credit Documents are untrue; (xviii) to the extent such Account is evidenced by a judgment, Instrument or Chattel Paper; (xix) to the extent (A) the Accounts owing from such Account Debtor and its Affiliates to the Borrowers exceeds 20% of the aggregate of all Eligible Accounts or (B) exceeds any credit limit established by the Collateral Agent, in its Permitted Discretion, following prior notice of such limit by the Collateral Agent to the Borrower Representative; (xx) that portion of any Account (1) in respect of which there has been, or should have been, established by a Borrower or any Guarantor a contra account, whether in respect of contractual allowances with respect to such Account, audit adjustment, anticipated discounts or otherwise or (2) which is due from an Account Debtor to whom any Credit Party owes a trade payable, but only to the extent of such trade payable; (xxi) any Account on which the Account Debtor is a Governmental Authority, unless all necessary steps are taken a Credit Party, as applicable, has assigned its rights to comply with payment of such Account to the Federal Administrative Agent pursuant to the Assignment of Claims Act of 1940, as amended, or with any comparable state in the case of a federal Governmental Authority, and pursuant to applicable law, if applicableany, in the case of any other Governmental Authority, and all other necessary steps are taken to perfect Lender’s security interest such assignment has been accepted and collection rights in such Account.acknowledged by the appropriate government officers; (jxxii) it any Account which is not owing by due from an Account Debtor for that has been structured as note payable or has been restructured as a note payable; or (xxiii) any Account which Borrower has received a notice of (i) the death of the Account Debtor or any partner Administrative Agent determines in its Permitted Discretion may not be paid by reason of the Account Debtor, (ii) ’s inability to pay or which the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver Administrative Agent otherwise determines in its Permitted Discretion is unacceptable for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Accountreason whatsoever.

Eligible Accounts. Upon Borrower’s The Eligible Accounts are bona fide existing payment obligations of Account Debtors created by the sale and delivery of Inventory or the rendition of services to Lender Obligors' customers in the ordinary course of a Borrowing Base Certificatethe Obligors' business, Lender shall determineowed to an Obligor without defenses, in its reasonable discretiondisputes, which offsets, counterclaims, or rights of return or cancellation. Any goods giving rise to such Eligible Accounts listed thereon are “have been delivered to the customer, or to the customer's agent for immediate shipment to the customer, and any services giving rise to such Eligible Accounts”Accounts have been fully performed. In making this determinationAs to each Eligible Account, Lender will consider such right to payment is not, unless an exception to any of the following requirementshas been consented to in writing by Agent: (a) The Account is not owing more than ninety (90) days after the date owed by an employee, Affiliate, or agent of the original invoice or other writing evidencing such Account;any Borrower, (b) it is not owing on account of a transaction wherein goods were placed on consignment or were sold pursuant to a guaranteed sale, a sale or return, a sale on approval, a bill ▇▇▇ hold, or pursuant to any other agreement providing for repurchase or return (other than pursuant to warranties made in the ordinary course of business), (c) payable in a currency other than Dollars (in the case of Eligible Domestic Accounts) or Canadian dollars (in the case of Eligible Canadian Accounts), (d) owed by an Account Debtor who that has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to unless the Account Debtor under has provided to the Agent an enforceable "non-offset" letter in form and substance reasonably satisfactory to the Agent) or has asserted a right of setoff, has disputed its liability, or has made any claim with respect to its obligation to honor the Obligor's right to payment (unless such Account; asserted right of setoff, dispute, or it arises from services rendered and claim has been disclosed in writing to Agent, in which case, such services have been performed; (d) it is evidenced by an invoice, dated not later than representation shall only be made to the date extent of shipment or performance, rendered to such Account Debtor that is not the subject of such setoff, dispute, or some other evidence of billing acceptable to Lender;claim), (e) it owed by an Account Debtor that, to the knowledge of Borrowers, is subject to any Insolvency Proceeding or is not evidenced by any note, trade acceptance, draft Solvent and no Obligor has received notice of an imminent Insolvency Proceeding involving the Account Debtor or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender;a material impairment of the financial condition of the applicable Account Debtor, (f) it is on account of a validtransaction as to which the goods, legally enforceable obligation the sale of which gives rise to such right to payment, have not been delivered to the Account Debtor thereunder, and is Obligor's customer or the services giving rise to such right to payment have not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part;been fully performed, (g) it a right to receive progress payments or other advance bill▇▇▇▇ ▇▇▇t are due prior to the completion of the performance by the Obligor that is not to give rise to the subject right to any sale of accountspayment, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller;and (h) it on account of a transaction that has not been billed to the customer (in the case of Eligible Accounts other than Eligible Unbilled Accounts) or is not owing by a parent, subsidiary, affiliate, officer, employee or partner to be billed to the customer within 30 days of Borrower, nor by an Account Debtor which the date of determination (i) does not maintain its chief executive office in the United States case of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such AccountEligible Unbilled Accounts). (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Account.

Eligible Accounts. Upon Eligible Accounts means, as of any determination date, the aggregate unpaid balance of Accounts that arose from bona fide, outright sales of items of Inventory that have been delivered and accepted and that are based upon valid, enforceable and legally binding orders or contracts that have been fully performed by the Borrower’s delivery to Lender of a Borrowing Base Certificate, Lender shall determineexcluding, in its reasonable discretionhowever, which Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider the following requirementsfollowing: (a) The 1. That portion of any Account that is not owing more than ninety (90) days after in dispute or as to which the date Borrower has received written notice that the account debtor claims right of the original invoice rejection, return, recoupment, setoff, counterclaim, deduction or other writing evidencing such Account;defense to payment. (b) it 2. Any Account that is not owing by an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offsetassignment, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignmentadverse claim, lien or security interest whatsoever interest, except in favor of Bank. 3. Any Account that is evidenced by, or as to which the Borrower has received, a note, chattel paper, draft, check, trade acceptance or other than to Lender, instrument in payment thereof and the subordinate for which Bank’s security interest of Seller; (h) it therein is not owing by a parent, subsidiary, clearly identified thereon. 4. Any Account as to which the account debtor is an affiliate, officer, employee officer or partner director of Borrower, nor by an . 5. Any invoice that remains unpaid for more than 60 days from the original invoice date. 6. Any Account Debtor which (i) does that is owing from a person or entity who is not maintain its chief executive office located in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoingStates, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing account has been approved by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting Bank in its sole discretion, shall discretion or that is payable in currency other than U.S. Dollars. 7. Any Account in which the Bank does not have notified Borrower are not deemed to constitute Eligible Accountsa first and prior perfected security interest. 8. Accounts will be considered ineligible and will be excluded from the Borrowing Base when more than 25% of the total amount due is more than 60 days from the invoice date. For the purposes of determining an ineligible account, accounts customarily presented on the borrower’s accounts receivable ledger as separate accounts, such as ABC Company - Oklahoma City, and ABC Company - Dallas, shall be considered as separate accounts for the purpose of determining eligibility. 9. Any other Account as to which Bank has made a determination, should twenty percent (20%) or more in the reasonable exercise of its discretion, that the Eligible Accounts be due and owing from any one Account Debtor at any time, then the prospects for collection are questionable. 10. The amount in excess of said twenty percent (20%) % of total Accounts Receivable that is owed by any individual account debtor. For the purposes of determining what constitutes an individual debtor, accounts customarily presented on the borrower’s accounts receivable ledger as separate accounts, such Accounts shall not be eligibleas ABC Company – Oklahoma City, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirementsand ABC Company – Dallas, shall forthwith cease to be an Eligible Accountconsidered as separate accounts for the purpose of determining individual debtors.

Eligible Accounts. Upon Borrower’s delivery to Lender On any date of a determination of the Borrowing Base, all of the Accounts owned by all Loan Parties and reflected in the most recent Borrowing Base Certificate, Lender Certificate delivered by the Lead Borrower to the Co-Collateral Agents and the Administrative Agent shall determine, in its reasonable discretion, which Accounts listed thereon are be “Eligible Accounts”” for the purposes of this Agreement, except any Account to which any of the exclusionary criteria set forth below applies. In addition, the Co-Collateral Agents reserve the right, at any time and from time to time after the Effective Date, to adjust any of the criteria set forth below, to establish new criteria with respect to Eligible Accounts and to adjust the advance rates in their Permitted Discretion, subject to the approval of the Required Lenders in the case of adjustments, new criteria or increases in advance rates which have the effect of making this determination, Lender will consider more credit available than would have been available if the standards in effect on the Effective Date had continued to be in effect: Eligible Accounts shall not include any of the following requirementsAccounts: (ai) The any Account is not owing more than ninety (90) days after in which the date Administrative Agent, on behalf of the original invoice or other writing evidencing such AccountSecured Parties, does not have a first priority (except, to the extent of Liens permitted under Section 6.2(a) hereof) perfected Lien; (bii) it any Account that is not owing owned by a Loan Party; (iii) any Account due from an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it that is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office domiciled in the United States of America or Canada, Canada and (iiif not a natural person) is not organized under the laws of the United States of America, or Canada or any state thereofpolitical subdivision thereof to the extent such Accounts (to the extent all such foreign Accounts exceed $2.0 million in the aggregate) are not backed by a letter of credit or credit insurance to the extent such insurance has been assigned to the Administrative Agent; (iv) any Account that is payable in any currency other than Dollars or, with the establishment of appropriate foreign currency reserves established by the Co-Collateral Agents, Canadian Dollars; (v) any Account that does not arise from the sale of goods or under the laws performance of services by such Loan Party in the ordinary course of its business; (vi) any Account that does not comply in all material respects with all applicable legal requirements, including, without limitation, all laws, rules, regulations and orders of any province in CanadaGovernmental Authority; (vii) any Account (A) upon which a Loan Party’s, right to receive payment is contingent upon the fulfillment of any condition whatsoever unless such condition is satisfied or (B) as to which a Loan Party, is not able to bring suit or otherwise enforce its remedies against the Account Debtor through judicial or administrative process, (C) that represents a progress billing consisting of an invoice for goods sold or used or services rendered pursuant to a contract under which the Account Debtor’s obligation to pay that invoice is subject to a Loan Party’s completion of further performance under such contract or is subject to the equitable lien of a surety bond issuer, or (iiiD) is the government of any foreign country Account that arises with respect to goods that are delivered on a ▇▇▇▇-and-hold, cash-on-delivery basis or sovereign stateplaced on consignment, or of any state, province, municipality guaranteed sale or other instrumentality thereofterms by reason of which the payment by the Account Debtor is or may be conditional except that Accounts arising from sales which are on a cash-on-delivery basis (to the extent such cash-on-delivery is in the ordinary course of business) shall not be deemed ineligible pursuant to this Section 2.19(a)(vii) until 14 days after the shipment of the goods relating thereto; (iviii) to the extent that any defense, counterclaim, setoff or dispute is asserted as to such Account, it being understood that the remaining balance of the Account shall be eligible; (ix) any Account that is not a true and correct statement of bona fide indebtedness incurred in the amount of the Account for merchandise sold to or services rendered and accepted by the applicable Account Debtor; (x) any Account with respect to which an invoice or other electronic transmission constituting a request for payment, reasonably acceptable to the Administrative Agent in form and substance, has not been sent on a timely basis to the applicable Account Debtor according to the normal invoicing and timing procedures of the Loan Parties; (xi) any Account that arises from a sale to any director, officer, other employee or Affiliate of a Loan Party, or to any entity that has any common officer or director with a Loan Party; (xii) any Account that is in default; provided that, without limiting the generality of the foregoing, an Account owing by shall be deemed in default upon the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality occurrence of any of the foregoingfollowing: 1) any Account not paid within the date that is more than 60 days past due according to its original terms of sale; or 2) the Account Debtor obligated upon such Account suspends business, makes a general assignment for the benefit of creditors or fails to pay its debts generally as they come due; or 3) a petition is filed by or against any Account Debtor obligated upon such Account under any bankruptcy law or any other federal, state or foreign (including any provincial) receivership, insolvency relief or other law or laws for the relief of debtors; provided that so long as an order exists permitting payment of trade creditors specifically with respect to such Account Debtor and such Account Debtor has obtained adequate post-petition financing to pay such Accounts, the Accounts of such Account Debtor shall not be deemed ineligible under the provisions of this clause (3) to the extent the order permitting such financing allows the payment of the applicable Account; (xiii) any Account that is the obligation of an Account Debtor (other than an individual) if 50% or more of the dollar amount of all Accounts owing by such Account Debtor are ineligible under the criteria set forth in Section 2.19(a)(xii); (xiv) any Account as to which any of the representations or warranties in the Loan Documents are untrue in any material respect (to the extent such materiality relates to the amount owing on such Account); (xv) to the extent such Account is evidenced by a judgment, Instrument or Chattel Paper and such Instrument or Chattel Papers is not pledged and delivered to the Administrative Agent under the Security Documents; (xvi) any Account on which the Account Debtor is a Governmental Authority, unless all necessary steps are taken the applicable Loan Party has assigned its rights to comply with payment of such Account to the Federal Administrative Agent pursuant to the Assignment of Claims Act of 1940, as amended, or with any comparable state lawin the case of a federal Governmental Authority, and pursuant to Applicable Law, if applicableany, in the case of any other Governmental Authority, and all other necessary steps are taken to perfect Lender’s security interest such assignment has been accepted and collection rights in such Account.acknowledged by the appropriate government officers; and (jxvii) it is not owing by an Any Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment arising on account of a receiver for any part of the property of the Account Debtor, supplier rebate or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Accountcustomer rebate.

Eligible Accounts. Upon Borrower’s delivery An "Eligible Account" is an Account that, when scheduled to Lender and at all times thereafter, does not violate the negative covenants and other provisions of a Borrowing Base Certificate, Lender this Section 5 and does satisfy the positive covenants and other provisions of this Section 5. The following Accounts are not and shall determine, in its reasonable discretion, which Accounts listed thereon are “not be considered Eligible Accounts”. In making this determination, Lender will consider the following requirements: (aA) The Accounts which remain unpaid for more than ninety (90) days after their invoice date; (B) Accounts owing by a single Account is not Debtor, including a currently scheduled Account, if fifty percent (50%) of the balance owing by said Account Debtor remains unpaid more than ninety (90) days after the date of the original invoice or other writing evidencing such Accountdate; (bC) it is Accounts which are not owing by an due and payable within at least thirty (30) days after their invoice dates, provided, however that (i) the following Accounts may be due and payable within forty-five (45) days after their invoice dates: Accounts in which the Account Debtor who has failed to pay twentyis Sam's Club, Wal-five percent Mart or CostCo Alaska; (25%ii) or more of if the aggregate amount of its Account Debtor is Sam's Mexico, Accounts owing to Borrower may be due and payable within sixty (60) days after their invoice dates; and (iii) if the Account Debtor is Houston Harvest, Accounts may be due and payable within ninety (90) days after the date of the respective invoices or other writings evidencing such Accountstheir invoice dates; (cD) it arises from the sale of goods and such goods have been shipped or delivered Accounts with respect to which the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliatedirector, officer, employee or partner agent of any Borrower or is a Parent, a Subsidiary or an Affiliate of any Borrower; (E) Except with respect to normal warranty claims in an amount not to exceed $200,000.00, nor Accounts with respect to which payment by an the Account Debtor is or becomes conditional upon the Account Debtor's approval of the Goods or services, or is otherwise subject to any repurchase obligation or return right, as with sales made on a ▇▇▇▇-and-hold, guaranteed sale, sale on approval, sale or return or consignment basis; (F) Accounts with respect to which the Account Debtor (i1) does is not maintain its chief executive office a resident, a citizen of or otherwise located in the United States of America America; or Canada, (ii2) is not organized under the laws subject to service of process in the United States of America, or any state thereofunless, or under in each case, such Accounts are supported by foreign credit insurance in form and substance acceptable to Lender, provided however, foreign credit insurance shall not be required for the laws of any province in following foreign Account Debtors: Kraft Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereofSam's Mexico and Technologias; (iG) it Accounts with respect to which the Account Debtor is not an Account owing by (1) the United States of America or any state department, agency or political subdivision instrumentality thereof, or by any department, agency, public body corporate or other instrumentality unless Borrowers assign their right to payment of any of the foregoing, unless all necessary steps are taken such Accounts to comply Lender in accordance with the Federal Assignment of Claims Act of 1940, as amended, or with (2) any comparable state lawcountry other than the United States of America or any department, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account.agency or instrumentality thereof; (jH) it The face amount of any Accounts with respect to which any Borrower is not owing by an or may become liable to the Account Debtor for Goods sold or services rendered by such Account Debtor to such Borrower, but only to the extent of the maximum aggregate amount of Borrowers' liability to such Account Debtor; (I) Accounts with respect to which Borrower has received a notice of (i1) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of Goods giving rise thereto have not been shipped and delivered to and accepted as satisfactory by the Account Debtor, or (iv2) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws services performed have not been completed and accepted as satisfactory by or against the Account Debtor; (kJ) it Accounts which are not invoiced, dated as of such date and sent to the Account Debtor concurrently with the shipment and delivery to and acceptance by said Account Debtor of the goods or the performance of the services giving rise thereto; (K) Accounts with respect to which possession or control of the goods sold is not an account billed in advanceheld, payable on deliverymaintained or retained by any Borrower, or by any agent or custodian of any Borrower, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, the account of or subject to further or future direction from the Account Debtor; (L) Accounts which are owing by any Account Debtor involved as a retainage debtor in any bankruptcy or holdback insolvency proceeding, whether voluntary or involuntary; (M) Accounts as to which Lender, at any time or times hereafter, determines in good faith that the prospect of payment or performance by the Account Debtor is or insured by a surety companywill be impaired; (1N) If Accounts with respect to which the Account Debtor is located in a state which requires any Borrower, as a precondition to commencing or maintaining an action in the courts of that state, either the State to (1) receive a certificate of New Jersey, the State of Minnesotaauthority to do business and be in good standing in such state, or the State (2) file a notice of Indianabusiness activities report or similar report with such state' s taxing authority, unless (a) such Borrower has filed a Notice taken one of Business Activities Report the actions described in clauses (1) or comparable report with (2), (b) the applicable state authority for failure to take one of the then current yearactions described in either clause (1) or (2) may be cured retroactively by such Borrower at its election, or (c) such Borrower has proven, to Lender's satisfaction, that it is exempt from any such requirements under any such state's laws; (mO) it All or any portion of an Account to the extent there exists or the Account Debtor has asserted a counterclaim or dispute; provided, however, if the amount of such counterclaim or dispute is equal to or greater than ten percent (10%) of the total Account owing from such Account Debtor to the applicable Borrower, then the full amount of such Account shall be deemed an ineligible Account; for purposes of this Section 5.1(O), the term "dispute" shall not owing include deductions taken by Account Debtors in the ordinary course of Borrowers' businesses which Borrowers have not challenged and do not intend to challenge. (P) Accounts for any Account Debtor whose obligations Lenderwhich exceed a credit limit established by Lender for such Account Debtor, acting in its sole discretion, shall have notified Borrower are not deemed but only to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) extent of such excess; and (Q) Accounts shall not be eligibleas to which any covenant, regardless of whether representation or warranty with respect to such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Accounthas been breached.

Eligible Accounts. Upon On any date of determination of the Borrowing Base, all of the Accounts owned by any Borrower’s delivery to Lender of a , as applicable, and reflected in the most recent Borrowing Base CertificateCertificate delivered by the Borrower Representative to the Collateral Agent and the Administrative Agent, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are be “Eligible Accounts”” for the purposes of this Agreement, except any Account to which any of the exclusionary criteria set forth below applies. In making this determination, Lender will consider Eligible Accounts shall not include any of the following requirementsAccounts: (ai) The any Account is not owing more than ninety (90) days after in which the date Collateral Agent, on behalf of the original invoice or other writing evidencing such AccountSecured Parties, does not have a valid perfected First Priority Lien; (bii) it any Account that is not owing owned by a Credit Party; (iii) any Account due from an Account Debtor who has failed to pay twenty-five percent (25%) or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it that is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office domiciled in the United States of America or Canada, Canada and (iiif not a natural person) is not organized under the laws of the United States of America, or Canada or any state political subdivision thereof, in each case unless such Account is backed by a letter of credit or under bankers acceptance that is acceptable to the laws Administrative Agent and that is in the possession of, has been assigned to and is drawable directly by the Administrative Agent; (iv) any Account that is payable in any currency other than Dollars; (v) any Account that does not arise from the sale of goods or the performance of services by such Credit Party in the ordinary course of its business; (vi) any Account that does not comply with all applicable legal requirements, including, without limitation, all laws, rules, regulations and orders of any province Governmental Authority; (vii) any Account which is owed by an Account Debtor located in Canadaany jurisdiction which requires filing of a “Notice of Business Activities Report” or other similar report in order to permit the applicable Borrower to seek judicial enforcement in such jurisdiction of payment of such Account, unless such Borrower (at the time the Account was created and at all times thereafter) (i) has qualified to do business in such jurisdiction and such qualification enables Borrower to seek judicial recourse in such jurisdiction, (ii) had filed and has filed and maintained effective such report with the appropriate office or agency of in such jurisdictions, as applicable, or (iii) is was and has continued to be exempt from filing such report and has provided the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality Collateral Agent with satisfactory evidence thereof; (iviii) it any Account (a) upon which the right of a Borrower, as applicable, to receive payment is not absolute or is contingent upon the fulfillment of any condition whatsoever unless such condition is satisfied or (b) as to which such Borrower is not able to bring suit or otherwise enforce its remedies against the Account Debtor through judicial or administrative process or (c) that represents a progress billing consisting of an invoice for goods sold or used or services rendered pursuant to a contract under which the Account Debtor’s obligation to pay that invoice is subject to a Borrower’s or any Guarantor’s, as applicable, completion of further performance under such contract or is subject to the equitable lien of a surety bond issuer; (ix) to the extent that any defense, counterclaim, setoff or dispute is asserted as to such Account, it being understood that the amount of any such defense, counterclaim, setoff or dispute shall be disclosed to the Collateral Agent and that the remaining balance of the Account shall be eligible; (x) [RESERVED] (xi) any Account with respect to which an invoice or other electronic transmission constituting a request for payment, reasonably acceptable to the Collateral Agent in form and substance, has not been sent on a timely basis to the applicable Account Debtor according to the normal invoicing and timing procedures of a Borrower, as applicable; (xii) any Account that arises from a sale to any director, officer, other employee or Affiliate of any Credit Party, or to any entity that has any common officer or director with any Credit Party; (xiii) to the extent Holdings or any Subsidiary is liable for goods sold or services rendered by the applicable Account Debtor to any Credit Party or any Subsidiary of a Credit Party but only to the extent of the potential offset; (xiv) any Account that arises with respect to goods that are delivered on a ▇▇▇▇-and-hold, cash-on-delivery basis or placed on consignment, guaranteed sale or other terms by reason of which the payment by the Account Debtor is or may be conditional; (xv) any Account that is in default; provided, that, without limiting the generality of the foregoing, an Account owing by shall be deemed in default upon the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality occurrence of any of the foregoingfollowing: (1) that portion of any Account that is more than 60 days past due according to its original terms of sale or which has been written off or designated as uncollectible by such Borrower (and, for the avoidance of doubt, the remainder of any such Account shall not be in default for purposes hereof unless all Accounts of the applicable Account Debtor are ineligible pursuant to clause (xvi) below); or (2) the Account Debtor obligated upon such Account suspends business, makes a general assignment for the benefit of creditors, has become insolvent, admits in writing its inability to pay its bills as they become due or fails to pay its debts generally as they come due; or (3) a petition is filed by or against any Account Debtor obligated upon such Account under any bankruptcy law or any other federal, state or foreign (including any provincial) receivership, insolvency relief or other law or laws for the relief of debtors; or (4) the payment terms (at inception or as modified from time to time) of any Account are not reasonably satisfactory to the Administrative Agent or Collateral Agent (it being understood that Borrowers’ customary terms as of the Restatement Effective Date are satisfactory to the Administrative Agent and the Collateral Agent); (xvi) any Account that is the obligation of an Account Debtor (other than an individual) if 50% or more of the Dollar amount of all Accounts owing by that Account Debtor are ineligible under the other criteria set forth in clause (xv) above; (xvii) any Account as to which any of the representations or warranties in the Credit Documents are untrue; (xviii) to the extent such Account is evidenced by a judgment, Instrument or Chattel Paper; (xix) to the extent (A) the Accounts owing from such Account Debtor and its Affiliates to the Borrowers exceeds 20% of the aggregate of all Eligible Accounts or (B) exceeds any credit limit established by the Collateral Agent, in its Permitted Discretion, following prior notice of such limit by the Collateral Agent to the Borrower Representative; (xx) that portion of any Account (1) in respect of which there has been, or should have been, established by a Borrower or any Guarantor a contra account, whether in respect of contractual allowances with respect to such Account, audit adjustment, anticipated discounts or otherwise or (2) which is due from an Account Debtor to whom any Credit Party owes a trade payable, but only to the extent of such trade payable; (xxi) any Account on which the Account Debtor is a Governmental Authority, unless all necessary steps are taken a Credit Party, as applicable, has assigned its rights to comply with payment of such Account to the Federal Administrative Agent pursuant to the Assignment of Claims Act of 1940, as amended, or with any comparable state in the case of a federal Governmental Authority, and pursuant to applicable law, if applicableany, in the case of any other Governmental Authority, and all other necessary steps are taken to perfect Lender’s security interest such assignment has been accepted and collection rights in such Account.acknowledged by the appropriate government officers; (jxxii) it any Account which is not owing by due from an Account Debtor for that has been structured as note payable or has been restructured as a note payable; or (xxiii) any Account which Borrower has received a notice of (i) the death of the Account Debtor or any partner Administrative Agent determines in its Permitted Discretion may not be paid by reason of the Account Debtor, (ii) ’s inability to pay or which the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver Administrative Agent otherwise determines in its Permitted Discretion is unacceptable for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Accountreason whatsoever.

Eligible Accounts. Upon Borrower’s delivery to Lender All Accounts of a Borrowing Base Certificate, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are “Eligible Accounts”. In making this determination, Lender will consider Borrower meeting all of the following requirements: specifications: (ai) The the Account is lawfully and exclusively owned by Borrower and subject to a first priority Lien in favor of Lender and subject to no other Lien (other than Permitted Liens, if applicable, and Liens granted under this Agreement) and Borrower has the right of assignment thereof and the power to grant a security interest therein; (ii) the Account does not owing represent a rebilling and is valid and enforceable representing the undisputed indebtedness of an Account Debtor not more than ninety (90) days after the date of past the original invoice or date (other writing evidencing such Account; (b) it is not than with respect to Accounts owing by any Blue Chip Customer, which shall not be more than one hundred and twenty (120) days past the original invoice date); (iii) not more than fifty percent (50%) of the aggregate balance of all Accounts owing from an Account Debtor who has failed to pay twenty-five percent obligated on the Account are outstanding more than sixty (25%60) days past their original due dates or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after past their original invoice dates; (iv) the date amount of the respective invoices Account, when aggregated with all other Accounts of such Account Debtor, is less than fifteen percent (15%) of the face value of all Accounts of Borrower then outstanding; (v) the Account is not a contra Account and is not subject to any defense, set-off, or other writings evidencing such Accounts; counterclaim, deduction, discount, credit, chargeback, freight claim, allowance or adjustment of any kind; (cvi) it the Account is net of any portion thereof attributable to the sale of goods that have been returned, rejected, lost or damaged; (vii) if the Account arises from the sale of goods by Borrower, such sale was an absolute sale and not on consignment or on approval or on a sale-or-return basis nor subject to any other repurchase or return agreement, and such goods have been shipped or delivered to the Account Debtor under such Accountor its designee; or it (viii) if the Account arises from services rendered and the performance of services, such services have actually been performed; performed and have been approved by the Account Debtor; (dix) it is evidenced by an invoicethe Account arose in the ordinary course of Borrower's business; (x) no notice of the bankruptcy, dated not later than the date of shipment receivership, reorganization, liquidation, dissolution, or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation insolvency of the Account Debtor thereunderhas been received by Lender or Borrower; (xi) the Account is an Account for which Lender believes that the validity, and enforceability or collection of the Account is not subject to any offset, counterclaim invalid or other defense on otherwise impaired; (xii) the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject a Subsidiary or Affiliate of Borrower; (xiii) the sale does not represent a sale pursuant to any sale a government contract unless Borrower has complied, for the benefit of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and with the subordinate security interest Assignment of Seller; Claims Act; (hxiv) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an the Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or political subdivision thereof, or by any department, agency, public body corporate or other instrumentality of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an Account Debtor for having its principal place of business or executive office outside the United States, unless the payment of such Account is guaranteed by an irrevocable letter of credit satisfactory to Lender or by credit insurance, satisfactory to Lender; (xv) the Account is not an Account on which the Account Debtor is obligated to Borrower has received under any Instrument; (xvi) the transaction which gave rise to the Account complies in all respects with all applicable laws, rules and regulations of any Governmental Authority; (xvii) the transaction which gave rise to the Account did not involve the issuance of a notice performance bond; and (xviii) the Account meets such other reasonable specifications and requirements which may from time to time be established by Lender. Eligible Accounts shall not include that portion of an Account representing (i) the death of the Account Debtor interest or any partner of the Account Debtor, finance charges for past due balances or debit memos and (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date ▇ in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State Excess of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible AccountCost.

Eligible Accounts. Upon Borrower’s delivery to Lender of a Borrowing Base Certificate, Lender Agent shall determinehave the sole right, in its sole reasonable discretion exercised in accordance with its customary business practices, to determine which Accounts of Borrowers are eligible (the "Eligible Accounts"). Without limiting Agent's discretion, which Accounts listed thereon are “the following Accounts, shall not be Eligible Accounts”. In making this determination, Lender will consider the following requirements: (ai) The Account is not owing more than Accounts which remain unpaid ninety (90) days after the earlier of the original date of the original applicable invoice or other writing evidencing the shipment date, and Accounts which remain unpaid sixty (60) days after the due date of such Account; Accounts, unless in either case Agent has made specific Account Debtor exceptions from the criteria set forth in this clause (bi); (ii) it is not all Accounts owing by an a single Account Debtor, including a currently scheduled Account, if (1) Accounts owing by such Account Debtor who has failed to pay would, if included as Eligible Accounts, exceed five percent (5%) of all Eligible Accounts and (2) twenty-five percent (25%) or more of the aggregate amount of its balance owing by such Account Debtor to Borrowers is ineligible due to the criteria set forth herein; (iii) Accounts owing with respect to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing such Accounts; (c) it arises from the sale of goods and such goods have been shipped or delivered to which the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a validLoan Party or a director, legally enforceable obligation officer, employee, Subsidiary or Affiliate of any Loan Party; (iv) Accounts with respect to which the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state department, agency or political subdivision instrumentality thereof, or by unless with respect to any departmentsuch Account, agency, public body corporate or other instrumentality the applicable Borrower has complied to Agent's satisfaction with the provisions of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amendedincluding, or without limitation, executing and delivering to Agent all statements of assignment and/or notification which are in form and substance acceptable to Agent and which are deemed necessary by Agent to effectuate the assignment to Agent of such Accounts; (v) Accounts with any comparable state law, if applicable, and all other necessary steps are taken respect to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner is not a resident of the Account DebtorUnited States or Canada (excluding the Northwest Territories, Nunavit or Quebec); (iivi) the dissolution, liquidation, termination of existence, insolvency or business failure of Accounts with respect to which the Account DebtorDebtor has asserted a counterclaim or has a right of setoff, to the extent of such counterclaim or right of setoff; (iiivii) Accounts for which the appointment prospect of a receiver for any part of the property of payment or performance by the Account Debtor, Debtor is or (iv) an assignment for the benefit of creditors, the filing of a petition may be impaired as determined by Agent in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date its sole reasonable discretion exercised in accordance with its termscustomary business practices; (viii) Accounts with respect to which Agent, subject on behalf of Lenders, does not have a first and valid fully perfected Lien; (ix) Accounts with respect to a retainage or holdback by which the Account Debtor is the subject of bankruptcy or insured a similar insolvency proceeding or has made an assignment of the benefit of creditors or whose assets have been conveyed to a receiver or trustee; (x) Accounts with respect to which the Account Debtor's obligation to pay the Account is conditional upon the Account Debtor's approval or is otherwise subject to any repurchase obligation or return right, as with sales made on a bill-and-hold, guaranteed sale, sale-or-return, sale on approval or consignment basis; (xi) Accounts to the extent that the Account Debtor's indebtedness to the Obligors exceeds a credit limit determined by a surety company; Agent in Agent's sole reasonable discretion exercised in accordance with its customary business practices; (1xii) If Accounts with respect to which the Account Debtor is located in either any state denying creditors access to its courts in the State absence of New Jerseya notice of business activities report or similar filing, unless the State of Minnesota, or the State of Indiana, applicable Borrower has either qualified as a foreign corporation to do business in such state or has filed a Notice such notice of Business Activities Report business activities report or comparable report similar filing with the applicable state authority agency for the then current year; ; (mxiii) it Accounts representing progress billings; (xiv) Accounts with respect to which any disclosure is not owing by re▇▇▇▇▇▇ in the applicable Accounts Trial Balance in accordance with subsection 3.3 hereof and (xv) Accounts of any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible AccountsPerson other than a Borrower. For purposes of determining eligibility, should twenty percent (20%) or more of In the event that previously scheduled Eligible Accounts be due and owing from any one Account Debtor at any time, then the in excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy $100,000 individually or $250,000 in the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith aggregate cease to be an Eligible AccountAccounts under the above described criteria, Borrower Representative shall notify Agent thereof promptly after any Obligor has obtained knowledge thereof. (p) Subsection 3.3 of the Loan Agreement is hereby amended to delete any reference therein to the term "Collateral Report" and to amend clause (iv) thereof to read as follows:

Eligible Accounts. Upon Borrower’s delivery On the report of Accounts (delivered to Lender the Bank monthly pursuant to Section 7.1(B)(iv) and as provided in Section 5.6), the Borrowers shall designate which of a Borrowing Base Certificatethe Accounts listed thereon the Borrowers believe to be Eligible Accounts pursuant to the criteria (other than that set forth on clause (J), Lender below). The Bank shall review such report and determine, in its reasonable discretionsole discretion (exercised in good faith), which Accounts listed thereon are “shall be deemed an "Eligible Account"; the Bank shall have no obligation whatsoever to accept the designations of the Borrowers. In determining which Accounts will be "Eligible Accounts”. In making this determination", Lender will the Bank may, inter alia, consider the following requirements: The Account is subject to a perfected first priority Lien in favor of the Bank and is due no more than thirty (30) days from the date of invoice under the original terms of shipment or service, arises from the delivery of goods or performance of services by a Borrower in the ordinary course of its business, conforms to the warranties and representations set forth in Section 6.2 and: (aA) The is an Account upon which such Borrower's right to receive payment is absolute and not owing contingent upon any further performance or delivery or the fulfillment of any condition whatsoever (e.g., consignment or guaranteed sale) and does not include any sales or other taxes, and such Borrower has possession of, or has delivered or will deliver as required hereunder to the Bank, copies of invoices, shipping and delivery receipts evidencing such performance or shipment; (B) is unpaid for not more than ninety thirty (9030) days after following the due date of the original invoice or other writing evidencing such Accounttherefor; (bC) it does not arise from a sale or sales to an Affiliate or from a consumer transaction (being one for primarily personal, family or household purposes); (D) is not owing by the obligation of an Account Debtor who has failed located in a foreign country other than Canada, except those foreign Accounts supported by a letter of credit acceptable to pay twenty-five percent (25%) the Bank which letter of credit is confirmed or more of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices issued by a United States bank or other writings evidencing bank acceptable to the Bank or is an Eligible Account insured by the Foreign Credit Insurance Association, provided that the letter of credit or insurance in respect of such Accountsforeign Accounts is assigned to the Bank by assignments in form and substance satisfactory to the Bank; (cE) it arises does not arise from a contract containing a prohibition against the sale assignment or grant of goods and such goods have been shipped or delivered to the Account Debtor under such Account; or it arises from services rendered and such services have been performeda security interest therein; (dF) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a valid, legally enforceable obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by from the United States of America or any state or political subdivision thereof, or by any department, agencyadministration, public body corporate agency or other instrumentality of any of the foregoingthereof, unless all necessary steps are taken the Bank is satisfied that its security interest in such Account has been perfected pursuant to comply with the Federal Assignment of Claims Act of 1940, as amended, or with any comparable equivalent state law, if applicable, and all other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account.statute; (jG) it is not owing by an Account of an Account Debtor for which Borrower who has received suspended business, made a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an general assignment for the benefit of creditors, the filing committed any act of a insolvency, filed or has had filed against it any petition in bankruptcy, or the commencement of any proceeding under any bankruptcy law or insolvency any other law or laws by or against for the Account Debtorrelief of debtors; (kH) it is not evidenced by an Instrument, Chattel Paper or other written agreement (other than invoices), unless the Instrument or Chattel Paper evidencing the Account has been delivered to and endorsed in favor of the Bank; (I) is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account of an Account Debtor who shall have objected to paying such Account, or insured any portion thereof, as a result of an objection to the quality or quantity of goods or services provided by a surety companysuch Borrower, or shall have rejected, returned or refused to accept such goods or services; (1J) If is not an Account which is, in the Bank's good faith judgment, (i) the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any an Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails undue credit risk or (ii) otherwise unacceptable to meet any of the foregoing requirements, shall forthwith cease to be an Eligible AccountBank.

Eligible Accounts. Upon Borrower’s delivery All of the Accounts owned by Borrower reflected in the most recent Borrowing Base Certificate delivered by Borrower to Lender of a Borrowing Base Certificate, Lender shall determine, in its reasonable discretion, which Accounts listed thereon are be “Eligible Accounts”” for purposes of this Agreement. In making this determination, Lender will consider the following requirementsEligible Accounts shall not include any Account of Borrower: (a) The Account is that does not owing more than ninety (90) days after arise from the date sale of goods or the original invoice or other writing evidencing such Accountperformance of services by Borrower in the ordinary course of its business; (bi) it upon which Borrower’s right to receive payment is not owing by an absolute or is contingent upon the fulfillment of any condition whatsoever, or (ii) as to which Borrower is not able to bring suit or otherwise enforce its remedies against the Account Debtor who has failed through judicial process, or (iii) if the Account represents a progress billing consisting of an invoice for goods sold or used or services rendered pursuant to a contract under which the Account Debtor’s obligation to pay twenty-five percent (25%) or more that invoice is subject to Borrower’s completion of the aggregate amount of its Accounts owing to Borrower within ninety (90) days after the date of the respective invoices or other writings evidencing further performance under such Accountscontract; (c) it arises from the sale of goods and such goods have been shipped or delivered to the extent that any defense, counterclaim, contra, setoff or dispute is asserted as to such Account Debtor under (but only to such Account; or it arises from services rendered and such services have been performedextent); (d) it that is evidenced not a true and correct statement of bona fide indebtedness incurred in the amount of the Account for merchandise sold to or services rendered and accepted by an invoice, dated not later than the date of shipment or performance, rendered to such applicable Account Debtor or some other evidence of billing acceptable to LenderDebtor; (e) it that (i) is not evidenced owned by Borrower, or (ii) is subject to any notelien of any other person, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to than liens in favor of Lender and is acceptable to LenderPermitted Liens; (f) it that is a valid, legally enforceable the obligation of the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in that is the United States of America government or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state or a political subdivision thereof, or by any state, county or municipality or department, agencyagency or instrumentality thereof unless Lender, public body corporate in its sole discretion, has agreed to the contrary in writing and Borrower, if necessary or other instrumentality of any of the foregoingdesirable, unless all necessary steps are taken has complied with respect to comply such obligation with the Federal Assignment of Claims Act of 1940, or any applicable state, county or municipal law restricting the assignment thereof with respect to such obligation; (g) that is the obligation of an Account Debtor located in a foreign country unless payment thereof is assured by a letter of credit assigned and delivered to Lender, satisfactory to Lender as amendedto form, amount and issuer; (h) to the extent Borrower is liable for goods sold or services rendered by the applicable Account Debtor to Borrower but only to the extent of the potential offset; (i) that arises with any comparable state lawrespect to goods that are delivered on a cash-on-delivery basis or placed on consignment, if applicable, and all guaranteed sale or other necessary steps are taken to perfect Lender’s security interest and collection rights in such Account.terms by reason of which the payment by the Account Debtor is or may be conditional; (j) it that is in default; provided, that, without limiting the generality of the foregoing, an Account shall be deemed in default upon the occurrence of any of the following: (k) the Account is not owing paid within sixty (60) days following its original invoice date; (l) the Account Debtor obligated upon such Account suspends business, makes a general assignment for the benefit of creditors or fails to pay its debts generally as they come due; or (m) a petition is filed by or against any Account Debtor obligated upon such Account under any bankruptcy law or any other federal, state or foreign (including any provincial) receivership, insolvency relief or other law or laws for the relief of debtors; (n) that is the obligation of an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner of the Account Debtor, (ii) the dissolution, liquidation, termination of existence, insolvency or business failure of the Account Debtor, (iii) the appointment of a receiver for any part of the property of the Account Debtor, or (iv) an assignment for the benefit of creditors, the filing of a petition in bankruptcy, or the commencement of any proceeding under any bankruptcy or insolvency laws by or against the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject to a retainage or holdback by the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty fifty percent (2050%) or more of the Eligible Dollar amount of all Accounts be due and owing from any one by that Account Debtor at any time, then are ineligible under the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the other criteria for eligibility set forth above. An Account in this Section; (o) as to which Lender’s lien thereon is at any time an Eligible Account, but not a first priority perfected lien; (p) as to which subsequently fails to meet any of the foregoing requirementsrepresentations or warranties in the Loan Documents are untrue in any material respect; (q) to the extent such Account is evidenced by a judgment, shall forthwith cease Instrument or Chattel Paper; (r) to be the extent that such Account, together with all other Accounts owing by such Account Debtor and its Affiliates as of any date of determination exceed 20% of all Eligible Accounts; (s) that is payable in any currency other than Dollars; or (t) that is an Eligible Accountobligation of an account debtor whose credit is not acceptable to Bank in its reasonable discretion.

Eligible Accounts. Upon Borrower’s delivery to Lender of a Borrowing Base Certificate, Lender Agent shall determinehave the sole right, in its reasonable discretion exercised in Good Faith, to determine which Accounts are eligible (the "Eligible Accounts"). Without limiting Agent's discretion, which the following Accounts listed thereon are “shall not be Eligible Accounts”. In making this determination, Lender will consider the following requirements: : (ai) The Account is not owing more than ninety Accounts which remain unpaid one hundred twenty (90120) days after the original date of the original invoice or other writing evidencing such Account; applicable invoice; (bii) it is not all Accounts owing by an a single Account Debtor who has failed to pay twenty-five Debtor, including a currently scheduled Account, if fifty percent (2550%) or more of the aggregate amount of its balance owing by such Account Debtor to a Borrower are not, or would not be, Eligible Accounts owing to Borrower within ninety (90) days after the date as a result of the respective invoices or other writings evidencing such Accounts; application of the provisions of the preceding clause (ci); (iii) it arises from the sale of goods and such goods have been shipped or delivered Accounts with respect to which the Account Debtor under such Account; or it arises from services rendered and such services have been performed; (d) it is evidenced by an invoice, dated not later than the date of shipment or performance, rendered to such Account Debtor or some other evidence of billing acceptable to Lender; (e) it is not evidenced by any note, trade acceptance, draft or other negotiable instrument or by any chattel paper, unless such note or other document or instrument previously has been endorsed and delivered by Borrower to Lender and is acceptable to Lender; (f) it is a validdirector, legally enforceable obligation officer, employee, Subsidiary or Affiliate of any Borrower; (iv) Accounts with respect to which the Account Debtor thereunder, and is not subject to any offset, counterclaim or other defense on the part of such Account Debtor or to any claim on the part of such Account Debtor denying liability thereunder in whole or in part; (g) it is not subject to any sale of accounts, any rights of offset, assignment, lien or security interest whatsoever other than to Lender, and the subordinate security interest of Seller; (h) it is not owing by a parent, subsidiary, affiliate, officer, employee or partner of Borrower, nor by an Account Debtor which (i) does not maintain its chief executive office in the United States of America or Canada, (ii) is not organized under the laws of the United States of America, or any state thereof, or under the laws of any province in Canada, or (iii) is the government of any foreign country or sovereign state, or of any state, province, municipality or other instrumentality thereof; (i) it is not an Account owing by the United States of America or any state department, agency or political subdivision instrumentality thereof, or by unless with respect to any departmentsuch Account, agency, public body corporate or other instrumentality the applicable Borrower has complied to Agent's satisfaction with the provisions of any of the foregoing, unless all necessary steps are taken to comply with the Federal Assignment of Claims Act of 1940, as amendedincluding, or without limitation, executing and delivering to Agent all statements of assignment and/or notification which are in form and substance acceptable to Agent and which are deemed necessary by Agent to effectuate the assignment to Agent of such Accounts; (v) Accounts with any comparable state law, if applicable, and all other necessary steps are taken respect to perfect Lender’s security interest and collection rights in such Account. (j) it is not owing by an Account Debtor for which Borrower has received a notice of (i) the death of the Account Debtor or any partner is not a resident of the Account DebtorUnited States or the Alberta, (ii) the dissolutionBritish Columbia, liquidationManitoba, termination Nova Scotia, Ontario, Ottawa or Saskatchewan Provinces of existenceCanada, insolvency or business failure of unless the Account DebtorDebtor has supplied the applicable Borrower with an irrevocable letter of credit, issued by a financial institution satisfactory to Agent, sufficient to cover such Account in form and substance reasonably satisfactory to Agent; (iiivi) the appointment of a receiver for any part of the property of Accounts with respect to which the Account Debtor, Debtor has asserted a counterclaim or has a right of setoff (ivbut only to the extent of such asserted counterclaim or setoff unless the Account Debtor is refusing to pay the remaining amount of such Account or Accounts); (vii) Accounts for which the prospect of payment or performance by the Account Debtor is or may be impaired as determined by Agent in its sole discretion exercised in Good Faith; (viii) Accounts with respect to which Agent does not have a first and valid fully perfected security interest; (ix) Accounts with respect to which the Account Debtor is the subject of bankruptcy or a similar insolvency proceeding or has made an assignment for the benefit of creditors, the filing of creditors or whose assets have been conveyed to a petition in bankruptcy, receiver or the commencement of any proceeding under any bankruptcy or insolvency laws by or against trustee; (x) Accounts with respect to which the Account Debtor; (k) it is not an account billed in advance, payable on delivery, for consigned goods, for guaranteed sales, for unbilled sales, for progress ▇▇▇▇▇▇▇▇, payable at a future date in accordance with its terms, subject 's obligation to a retainage or holdback by pay the Account Debtor or insured by a surety company; (1) If the Account Debtor is located in either the State of New Jersey, the State of Minnesota, or the State of Indiana, Borrower has filed a Notice of Business Activities Report or comparable report with the applicable state authority for the then current year; (m) it is not owing by any Account Debtor whose obligations Lender, acting in its sole discretion, shall have notified Borrower are not deemed to constitute Eligible Accounts. For purposes of determining eligibility, should twenty percent (20%) or more of the Eligible Accounts be due and owing from any one Account Debtor at any time, then the excess of said twenty percent (20%) of such Accounts shall not be eligible, regardless of whether such Accounts otherwise satisfy the criteria for eligibility set forth above. An Account which is at any time an Eligible Account, but which subsequently fails to meet any of the foregoing requirements, shall forthwith cease to be an Eligible Account.