IN SUCH OTHER FORM AS MAY
MUTUALLY BE AGREED UPON BY LC ISSUER AND BORROWER).
TWO BUSINESS DAYS AFTER THE
LC CONDITIONS FOR A LETTER OF CREDIT HAVE BEEN MET AS DESCRIBED IN SECTION 2.11
(OR IF LC ISSUER OTHERWISE DESIRES TO ISSUE SUCH LETTER OF CREDIT), LC ISSUER
WILL ISSUE SUCH LETTER OF CREDIT AT LC ISSUER'S OFFICE IN HOUSTON, TEXAS.
IF
ANY PROVISIONS OF ANY LC APPLICATION CONFLICT WITH ANY PROVISIONS OF THIS
AGREEMENT, THE PROVISIONS OF THIS AGREEMENT SHALL GOVERN AND CONTROL.
BORROWER
SHALL PROMPTLY EXAMINE A COPY OF EACH LETTER OF CREDIT AND EACH AMENDMENT
THERETO
26
THAT IS DELIVERED TO IT AND, IN THE EVENT OF ANY CLAIM OF NONCOMPLIANCE WITH
BORROWER'S INSTRUCTIONS OR OTHER IRREGULARITY, BORROWER WILL PROMPTLY NOTIFY LC
ISSUER.
SECTION 2.11.
REIMBURSEMENT AND PARTICIPATIONS.
(A)
REIMBURSEMENT BY BORROWER.
EACH MATURED LC OBLIGATION SHALL CONSTITUTE A
REVOLVING LOAN BY LC ISSUER TO BORROWER.
BORROWER PROMISES TO PAY TO LC ISSUER,
OR TO LC ISSUER'S ORDER, ON THE BUSINESS DAY IMMEDIATELY FOLLOWING THE DAY ON
WHICH A DEMAND IS MADE, THE FULL AMOUNT OF EACH MATURED LC OBLIGATION, TOGETHER
WITH INTEREST THEREON AT THE DEFAULT RATE APPLICABLE TO BASE RATE LOANS.
THE
OBLIGATION OF BORROWER TO REIMBURSE LC ISSUER FOR EACH MATURED LC OBLIGATION
SHALL BE ABSOLUTE, UNCONDITIONAL AND IRREVOCABLE, AND SHALL BE PAID STRICTLY IN
ACCORDANCE WITH THE TERMS OF THIS AGREEMENT (INCLUDING ANY LC APPLICATION) UNDER
ALL CIRCUMSTANCES, INCLUDING THE FOLLOWING: (I) ANY LACK OF VALIDITY OR
ENFORCEABILITY OF SUCH LETTER OF CREDIT OR ANY OTHER AGREEMENT OR INSTRUMENT
RELATING THERETO; (II) THE EXISTENCE OF ANY CLAIM, COUNTERCLAIM, SET-OFF,
DEFENSE OR OTHER RIGHT THAT BORROWER MAY HAVE AT ANY TIME AGAINST ANY
BENEFICIARY OR ANY TRANSFEREE OF SUCH LETTER OF CREDIT (OR ANY PERSON FOR WHOM
ANY SUCH BENEFICIARY OR ANY SUCH TRANSFEREE MAY BE ACTING), LC ISSUER OR ANY
OTHER PERSON, WHETHER IN CONNECTION WITH THIS AGREEMENT, THE TRANSACTIONS
CONTEMPLATED HEREBY OR BY SUCH LETTER OF CREDIT OR ANY AGREEMENT OR INSTRUMENT
RELATING THERETO, OR ANY UNRELATED TRANSACTION; (III) ANY DRAFT, DEMAND,
CERTIFICATE OR OTHER DOCUMENT PRESENTED UNDER SUCH LETTER OF CREDIT PROVING TO
BE FORGED, FRAUDULENT, INVALID OR INSUFFICIENT IN ANY RESPECT OR ANY STATEMENT
THEREIN BEING UNTRUE OR INACCURATE IN ANY RESPECT; OR ANY LOSS OR DELAY IN THE
TRANSMISSION OR OTHERWISE OF ANY DOCUMENT REQUIRED IN ORDER TO MAKE A DRAWING
UNDER SUCH LETTER OF CREDIT; (IV) ANY PAYMENT BY LC ISSUER UNDER SUCH LETTER OF
CREDIT AGAINST PRESENTATION OF A DRAFT OR CERTIFICATE THAT DOES NOT STRICTLY
COMPLY WITH THE TERMS OF SUCH LETTER OF CREDIT; OR (V) ANY OTHER CIRCUMSTANCE OR
HAPPENING WHATSOEVER, WHETHER OR NOT SIMILAR TO ANY OF THE FOREGOING.
WITHOUT
LIMITING THE GENERALITY OF THE FOREGOING, IT IS EXPRESSLY AGREED THAT THE
ABSOLUTE AND UNCONDITIONAL NATURE OF BORROWER'S OBLIGATIONS UNDER THIS
SECTION TO REIMBURSE LC ISSUER FOR EACH DRAWING UNDER A LETTER OF CREDIT WILL
NOT BE EXCUSED BY THE GROSS NEGLIGENCE OR WILLFUL MISCONDUCT OF LC ISSUER.
HOWEVER, THE FOREGOING SHALL