Nautilus 2009 Annual Report Download - page 284

(i) Inventory that is located on premises leased or rented by Borrower, unless (i) Borrower has delivered to Lender a
landlord’
s lien waiver or subordination in a form satisfactory to Lender in its Permitted Discretion, or (ii) Borrower has established reserves in an
amount equal to three months’ rent;
(j) Inventory stored with a bailee or warehouseman, unless (i) Borrower has delivered to Lender a written acknowledgment of
such bailee or warehouseman, in a form satisfactory to Lender in its Permitted Discretion, that such Person does not have a Lien in the Inventory
in question, or (ii) Borrower has established reserves in an amount equal to three months’ rent or three months of charges from such bailee or
warehouseman;
(k) Inventory stored with a consignee, unless Borrower has demonstrated to Lender’s reasonable satisfaction, that Borrower
has taken reasonable steps to ensure that the Inventory in question shall not become subject to security interests or claims of creditors of the
consignee;
(l) Inventory located at a location owned by Borrower that is subject to a mortgage or deed of trust in favor of a lender other
than Lender, unless Borrower has delivered to Lender a mortgagee’s lien waiver or subordination in a form satisfactory to Lender in its
Permitted Discretion;
(m) Inventory that is covered by a negotiable document of title, unless such document and evidence of acceptable insurance
covering such Inventory have been delivered to Lender with all necessary endorsements, free and clear of all Liens, except those in favor of
Lender and inchoate tax Liens; or
(n) Other Inventory that Lender determines in its Permitted Discretion should not be included in the Borrowing Base.
The value of Eligible Inventory shall be determined in accordance with the lower of cost or market method of determining Inventory value.
Lender’s calculation and determination of Eligible Inventory shall be binding and conclusive, absent manifest error.
“ Environmental Laws ” means any and all applicable federal, state, and local environmental, health, or safety statutes, laws,
regulations, rules, and ordinances (whether now existing or hereafter enacted or promulgated), and all applicable judicial, administrative, and
regulatory decrees, judgments, and orders, including common law rulings and determinations, relating to injury to, or the protection of, human
health or the environment, including, without limitation, all requirements pertaining to reporting, licensing, permitting, investigation,
remediation, and removal of emissions, discharges, releases, or threatened releases of Hazardous Materials into the environment, or relating to
the manufacture, processing, distribution, use, treatment, storage, disposal, transport, or handling of such Hazardous Materials.
“ ERISA ” means The Employee Retirement Income Security Act of 1974 and the rules and regulations thereunder, collectively, as
the same from time to time may be supplemented or amended and remain in effect.
“ Event of Default ” has the meaning specified in Section 10.1 of this Agreement.
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