DESCRIPTION OF THE PURPOSE OF THE ACCOUNT,
AND THE COMPLETE ACCOUNT NUMBER.
THE
COMPANY SHALL NOT ESTABLISH ANY
DEPOSITORY OR OTHER BANK ACCOUNT OF ANY WITH ANY FINANCIAL INSTITUTION (OTHER
THAN THE ACCOUNTS SET FORTH ON EXHIBIT 7(P) WITHOUT LAURUS' PRIOR WRITTEN
CONSENT.
8
8.
PAYMENT OF ACCOUNTS.
(A)
COMPANY WILL IRREVOCABLY DIRECT ALL OF ITS PRESENT AND FUTURE ACCOUNT
DEBTORS AND OTHER PERSONS OBLIGATED TO MAKE PAYMENTS CONSTITUTING COLLATERAL TO
MAKE SUCH PAYMENTS DIRECTLY TO THE LOCKBOX MAINTAINED BY COMPANY (THE "LOCKBOX")
WITH WELLS FARGO PURSUANT TO THE TERMS OF THE CLEARING ACCOUNT
AGREEMENT DATED
AUGUST
, 2003 AMONG THE COMPANY, LAURUS AND WELLS FARGO BANK, (THE "LOCKBOX
AGREEMENT")OR SUCH OTHER FINANCIAL INSTITUTION ACCEPTED BY LAURUS IN WRITING AS
MAY BE SELECTED BY COMPANY (THE "LOCKBOX BANK").
ON OR PRIOR TO THE CLOSING
DATE, COMPANY SHALL AND SHALL CAUSE THE LOCKBOX BANK TO ENTER INTO ALL SUCH
DOCUMENTATION ACCEPTABLE TO LAURUS PURSUANT TO WHICH, AMONG OTHER THINGS, THE
LOCKBOX BANK AGREES TO:
(A) SWEEP THE LOCKBOX ON A DAILY BASIS AND DEPOSIT ALL
CHECKS RECEIVED THEREIN TO AN ACCOUNT DESIGNATED BY LAURUS IN WRITING AND (B)
COMPLY ONLY WITH THE INSTRUCTIONS OR OTHER DIRECTIONS OF LAURUS CONCERNING THE
LOCKBOX.
ALL OF COMPANY'S INVOICES, ACCOUNT STATEMENTS AND OTHER WRITTEN OR
ORAL COMMUNICATIONS DIRECTING, INSTRUCTING, DEMANDING OR REQUESTING PAYMENT OF
ANY ACCOUNT OF COMPANY OR ANY OTHER AMOUNT CONSTITUTING COLLATERAL SHALL
CONSPICUOUSLY DIRECT THAT ALL PAYMENTS BE MADE TO THE LOCKBOX OR SUCH OTHER
ADDRESS AS LAURUS MAY DIRECT IN WRITING.
IF, NOTWITHSTANDING THE INSTRUCTIONS
TO ACCOUNT DEBTORS, COMPANY RECEIVES ANY PAYMENTS, COMPANY SHALL IMMEDIATELY
REMIT SUCH PAYMENTS TO LAURUS IN THEIR ORIGINAL FORM WITH ALL NECESSARY
ENDORSEMENTS.
UNTIL SO REMITTED, COMPANY SHALL HOLD ALL SUCH PAYMENTS IN TRUST
FOR AND AS THE PROPERTY OF LAURUS AND SHALL NOT COMMINGLE SUCH PAYMENTS WITH ANY
OF ITS OTHER FUNDS OR PROPERTY.
COMPANY SHALL PAY LAURUS FIVE PERCENT (5%) OF
THE AMOUNT OF ANY PAYMENT SO RECEIVED BY COMPANY AND NOT DELIVERED IN KIND TO
LAURUS WITHIN FIVE (5) BUSINESS DAYS FOLLOWING COMPANY'S RECEIPT THEREOF.
(B)
AT LAURUS' ELECTION, FOLLOWING THE OCCURRENCE OF AN EVENT OF DEFAULT,
LAURUS MAY NOTIFY COMPANY'S ACCOUNT DEBTORS OF LAURUS' SECURITY INTEREST IN THE
ACCOUNTS, COLLECT THEM DIRECTLY AND CHARGE THE COLLECTION COSTS AND EXPENSES
THEREOF TO COMPANY'S ACCOUNT.
9.
COLLECTION AND MAINTENANCE OF COLLATERAL.
(A)
LAURUS MAY VERIFY COMPANY'S ACCOUNTS UTILIZING AN AUDIT CONTROL COMPANY OR
ANY OTHER AGENT OF LAURUS.
(B)
PROCEEDS OF ACCOUNTS RECEIVED BY LAURUS WILL BE DEEMED RECEIVED UPON
LAURUS' RECEIPT OF SUCH PROCEEDS IN GOOD FUNDS IN DOLLARS OF THE UNITED STATES
OF AMERICA IN LAURUS' ACCOUNT.
ANY AMOUNT RECEIVED BY LAURUS AFTER 12:00 NOON
(NEW YORK TIME) ON ANY BUSINESS DAY SHALL BE DEEMED RECEIVED ON THE NEXT
BUSINESS DAY.
(C)
AS LAURUS RECEIVES THE PROCEEDS OF ACCOUNTS, IT SHALL APPLY ALL SUCH
PROCEEDS TO REPAY THE THEN OUTSTANDING LOANS TO THE EXTENT THEY EXCEED THE
MINIMUM BORROWING AMOUNT AND THEN SHALL REMIT ALL SUCH REMAINING PROCEEDS (NET
OF INTEREST,