ACTING ALONE, AS COMPANY'S ATTORNEY IN FACT (WHICH APPOINTMENT
IS COUPLED WITH AN INTEREST) WITH THE RIGHT (BUT NOT THE DUTY) FROM TIME TO TIME
TO CREATE, PREPARE, COMPLETE, EXECUTE, DELIVER, ENDORSE OR FILE IN THE NAME AND
ON BEHALF OF COMPANY ANY AND ALL INSTRUMENTS, DOCUMENTS, ASSIGNMENTS, SECURITY
AGREEMENTS, FINANCING STATEMENTS, APPLICATIONS FOR INSURANCE AND OTHER
AGREEMENTS AND WRITINGS REQUIRED TO BE OBTAINED, EXECUTED DELIVERED OR ENDORSED
BY COMPANY.
LAURUS WILL ACCOUNT TO COMPANY MONTHLY WITH A STATEMENT OF ALL LOANS AND OTHER
ADVANCES, CHARGES AND PAYMENTS MADE PURSUANT TO THIS AGREEMENT, AND SUCH ACCOUNT
RENDERED BY LAURUS SHALL BE DEEMED FINAL, BINDING AND CONCLUSIVE UNLESS LAURUS
IS NOTIFIED BY COMPANY IN WRITING TO THE CONTRARY WITHIN THIRTY (30) DAYS OF THE
DATE EACH ACCOUNT WAS RENDERED SPECIFYING THE ITEM OR ITEMS TO WHICH OBJECTION
IS MADE.
DURING THE TERM, COMPANY MAY BORROW AND PREPAY LOANS IN EXCESS OF THE MINIMUM
BORROWING AMOUNT, ALL IN ACCORDANCE WITH THE TERMS AND CONDITIONS HEREOF.
IF ANY ELIGIBLE ACCOUNT IS NOT PAID BY THE ACCOUNT DEBTOR WITHIN NINETY (90)
DAYS AFTER THE DATE THAT SUCH ELIGIBLE ACCOUNT WAS INVOICED OR IF ANY ACCOUNT
DEBTOR ASSERTS A DEDUCTION, DISPUTE,
10Z-2
CONTINGENCY, SET-OFF, OR COUNTERCLAIM WITH RESPECT TO ANY ELIGIBLE ACCOUNT, (A
"DELINQUENT ACCOUNT"), THE COMPANY SHALL (I) REIMBURSE LAURUS FOR THE AMOUNT OF
THE REVOLVING CREDIT ADVANCE MADE WITH RESPECT TO SUCH DELINQUENT ACCOUNT PLUS
AN ADJUSTMENT FEE IN AN AMOUNT EQUAL TO ONE-HALF OF ONE PERCENT (0.50%) OF THE
GROSS FACE AMOUNT OF SUCH ELIGIBLE ACCOUNT OR (II) IMMEDIATELY REPLACE SUCH
DELINQUENT ACCOUNT WITH AN OTHERWISE ELIGIBLE ACCOUNT.
(C)
FOLLOWING THE OCCURRENCE OF AN EVENT OF DEFAULT WHICH CONTINUES TO
EXIST, LAURUS MAY, AT ITS OPTION, ELECT TO CONVERT THE CREDIT FACILITY
CONTEMPLATED HEREBY TO AN ACCOUNTS RECEIVABLE PURCHASE FACILITY.
UPON SUCH
ELECTION BY LAURUS (SUBSEQUENT NOTICE OF WHICH LAURUS SHALL PROVIDE TO COMPANY),
COMPANY SHALL BE DEEMED TO HEREBY HAVE SOLD, ASSIGNED, TRANSFERRED, CONVEYED AND
DELIVERED TO LAURUS, AND LAURUS SHALL BE DEEMED TO HAVE PURCHASED AND RECEIVED
FROM COMPANY, ALL RIGHT, TITLE AND INTEREST OF COMPANY IN AND TO ALL ACCOUNTS
WHICH SHALL AT ANY TIME CONSTITUTE ELIGIBLE ACCOUNTS (THE "RECEIVABLES
PURCHASE").
ALL OUTSTANDING LOANS HEREUNDER SHALL BE DEEMED OBLIGATIONS UNDER
SUCH ACCOUNTS RECEIVABLE PURCHASE FACILITY.
THE CONVERSION TO AN ACCOUNTS
RECEIVABLE PURCHASE FACILITY IN ACCORDANCE WITH THE TERMS HEREOF SHALL NOT BE
DEEMED AN EXERCISE BY LAURUS OF ITS SECURED CREDITOR RIGHTS UNDER ARTICLE 9 OF
THE UCC.
IMMEDIATELY FOLLOWING LAURUS' REQUEST, COMPANY SHALL EXECUTE ALL SUCH
FURTHER DOCUMENTATION AS MAY BE REQUIRED BY LAURUS TO MORE FULLY SET FORTH THE
ACCOUNTS RECEIVABLE PURCHASE FACILITY HEREIN CONTEMPLATED, INCLUDING, WITHOUT
LIMITATION, LAURUS' STANDARD FORM OF ACCOUNTS RECEIVABLE PURCHASE AGREEMENT AND
ACCOUNT DEBTOR NOTIFICATION LETTERS, BUT COMPANY'S FAILURE TO ENTER INTO ANY
SUCH DOCUMENTATION SHALL NOT IMPAIR OR AFFECT THE RECEIVABLES PURCHASE IN ANY
MANNER WHATSOEVER.
(d)
Minimum Borrowing Amount.
After a registration statement
registering the Registrable Securities has been declared effective by the SEC,
conversions of the Minimum Borrowing