Interest on Revolving Advances. Borrower shall pay interest monthly, in arrears, on the first day of each month, commencing September 1, 2001 on the average daily unpaid principal amount of the Revolving Advances made to Borrower at a fluctuating rate which is equal to the Prime Rate plus one and three quarter of one percent (1.75) per annum; provided that, the interest rate will be reduced: (a) by one quarter of one percent (.25%), effective on the date Borrower actually delivers to Lender the consolidated financial statements for Borrower's fiscal quarter ended December 31, 2001 in accordance with Section 8.4 below; and (b) by an additional one quarter of one percent (.25%), effective on the date that Borrower actually delivers to Lender the consolidated financial statements for Borrower's fiscal quarter ended March 31, 2001 in accordance with Section 8.4 below, in each case so long as (i) no Event of Default has occurred hereunder at any time during the immediately preceding quarter, which means in the case of (a) above, from September 1, 2001 through December 31, 2001; and in the case of (b) above, January 1, 2002 through March 31, 2002; (ii) such financial statements evidence that Borrower has Operating Income of $0.00 or greater for each such quarter, as determined in accordance with GAAP; and
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