CREDIT, ALL ADVANCES SHALL BE REPAYABLE AS PROVIDED IN SECTIONS 2.12 AND 2.13,
AND SHALL BE USED BY BORROWER ONLY FOR THE PURPOSES SPECIFIED IN SECTION 2.10
AND CONSISTENT WITH ALL APPLICABLE LAWS AND STATUTES.
(B)
MAXIMUM COMMITMENT.
THE AGGREGATE OUTSTANDING PRINCIPAL AMOUNT OF
THE REVOLVING LOANS MADE TO BORROWER AT ANY ONE TIME (THE "MAXIMUM COMMITMENT")
SHALL NOT EXCEED THE LESSER OF:
(I)
THE MAXIMUM CREDIT LINE; OR
(II)
THE AMOUNT BY WHICH (A) THE SUM OF (1) UP TO ONE HUNDRED PERCENT
(100%) OF THE NET ELIGIBLE SBA GUARANTEED NOTES RECEIVABLE, PLUS (2) UP TO
EIGHTY PERCENT (80%) OF THE NET ELIGIBLE NON-GUARANTEED NOTES RECEIVABLE,
EXCEEDS (B) THE SUM OF (1) THE BANK PRODUCTS RESERVES, PLUS (2) THE AGGREGATE
AMOUNT, IF ANY, OF NOTE SALE RESERVES THEN ESTABLISHED AND OUTSTANDING, PLUS
(3) THE AGGREGATE AMOUNT OF ANY OTHER RESERVES ESTABLISHED BY LENDER PURSUANT TO
SECTION 2.1(C).
(C)
RESERVES.
ANYTHING TO THE CONTRARY IN THIS SECTION 2.1
NOTWITHSTANDING, LENDER SHALL HAVE THE RIGHT TO ESTABLISH RESERVES IN SUCH
AMOUNTS, AND WITH RESPECT TO SUCH MATTERS, AS LENDER IN THE EXERCISE OF ITS
REASONABLE (FROM THE PERSPECTIVE OF A SECURED ASSET-BASED LENDER IN THE SAME OR
SIMILAR CIRCUMSTANCES) BUSINESS JUDGMENT SHALL DEEM NECESSARY OR
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APPROPRIATE OR IN THE EVENT OF A MATERIAL ADVERSE CHANGE, AGAINST THE AMOUNT OF
REVOLVING LOANS AVAILABLE HEREUNDER, INCLUDING RESERVES WITH RESPECT TO (I) SUMS
THAT BORROWER IS REQUIRED TO PAY (SUCH AS TAXES, ASSESSMENTS, INSURANCE
PREMIUMS, OR, IN THE CASE OF LEASED ASSETS, RENTS OR OTHER AMOUNTS PAYABLE UNDER
SUCH LEASES) AND HAS FAILED TO PAY UNDER ANY SECTION OF THIS AGREEMENT OR ANY
OTHER LOAN DOCUMENT, AND (II) AMOUNTS OWING BY BORROWER TO ANY PERSON TO THE
EXTENT SECURED BY A LIEN ON, OR TRUST OVER, ANY OF THE COLLATERAL (OTHER THAN
ANY EXISTING PERMITTED LIEN SET FORTH ON SCHEDULE 4.3(B) THAT IS SPECIFICALLY
IDENTIFIED THEREON AS ENTITLED TO HAVE PRIORITY OVER LENDER'S LIENS), WHICH LIEN
OR TRUST LENDER, IN THE EXERCISE OF ITS REASONABLE (FROM THE PERSPECTIVE OF A
SECURED ASSET-BASED LENDER IN THE SAME OR SIMILAR CIRCUMSTANCES) BUSINESS
JUDGMENT, BELIEVES LIKELY WOULD HAVE A PRIORITY SUPERIOR TO LENDER'S LIENS (SUCH
AS LIENS OR TRUSTS IN FAVOR OF LANDLORDS, WAREHOUSEMEN, CARRIERS, MECHANICS,
MATERIALMEN, LABORERS, OR SUPPLIERS, OR LIENS OR TRUSTS FOR AD VALOREM, EXCISE,
SALES, OR OTHER TAXES WHERE GIVEN PRIORITY UNDER APPLICABLE LAW) IN AND TO SUCH
ITEM OF THE COLLATERAL.
LENDER WILL USE REASONABLE EFFORTS TO INFORM BORROWER
OF ANY SUCH RESERVES WITHIN FIVE BUSINESS DAYS AFTER ESTABLISHING SAME;
PROVIDED, THAT LENDER SHALL HAVE NO LIABILITY FOR ANY DELAY OR FAILURE IN DOING
SO AND ANY DELAY OR FAILURE TO DO SO SHALL NOT IMPAIR ANY OF LENDER'S RIGHTS OR
BORROWER'S OBLIGATIONS UNDER THE LOAN DOCUMENTS.
IN ADDITION TO THE FOREGOING,
LENDER AND ITS REAL ESTATE VALUATION ADVISOR SHALL HAVE THE RIGHT TO DETERMINE
THE VALUE OF ANY PROPERTY SECURING AN SBA 7(A) LOAN DURING EACH CALENDAR QUARTER
FOR THE PURPOSE OF REDETERMINING THE FAIR MARKET VALUE OF THE