ON THE MATURITY DATE, WHEN THE PRINCIPAL AMOUNT OF ALL ADVANCES, THE
UNPAID INTEREST THEREON, AND ALL OTHER OBLIGATIONS RELATING TO THE REVOLVING
LINE SHALL BE IMMEDIATELY DUE AND PAYABLE. PROVIDED THAT ALL OBLIGATIONS
HEREUNDER HAVE BEEN REPAID, THE BORROWER MAY TERMINATE THIS AGREEMENT WITHOUT
PENALTY OR PREMIUM AT ANY TIME UPON NOT LESS THAN FIVE (5) BUSINESS DAYS PRIOR
WRITTEN NOTICE TO BANK.
2.1.2
LETTERS OF CREDIT SUBLIMIT.
(A)
BANK SHALL ISSUE OR HAVE ISSUED LETTERS OF
CREDIT FOR BORROWER'S ACCOUNT NOT EXCEEDING (I) THE LESSER OF (A) THE REVOLVING
LINE OR (B) THE BORROWING BASE MINUS (II) THE OUTSTANDING PRINCIPAL BALANCE OF
ANY ADVANCES (INCLUDING ANY CASH MANAGEMENT SERVICES), MINUS (III) THE FX
RESERVE, MINUS (IV) THE OUTSTANDING
BALANCE OF ALL LETTERS OF CREDIT UNDRAWN OR UNREIMBURSED, PLUS AN AMOUNT EQUAL
TO ANY LETTER OF CREDIT RESERVES.
THE FACE AMOUNT OF OUTSTANDING LETTERS OF
CREDIT (INCLUDING DRAWN BUT UNREIMBURSED LETTERS OF CREDIT AND ANY LETTER OF
CREDIT RESERVE) MAY NOT EXCEED $1,000,000.00.
BORROWER'S LETTER OF CREDIT
REIMBURSEMENT OBLIGATION SHALL BE SECURED BY CASH ON TERMS ACCEPTABLE TO BANK ON
AND AFTER (I) THE MATURITY DATE, OR (II) THE OCCURRENCE OF AN EVENT OF DEFAULT
HEREUNDER.
ALL LETTERS OF CREDIT SHALL BE IN FORM AND SUBSTANCE ACCEPTABLE TO
BANK IN ITS SOLE DISCRETION, AND SHALL BE SUBJECT TO THE TERMS AND CONDITIONS OF
BANK'S STANDARD APPLICATION AND LETTER OF CREDIT AGREEMENT ("LETTER OF CREDIT
APPLICATION").
BORROWER AGREES TO EXECUTE ANY FURTHER DOCUMENTATION IN
CONNECTION WITH THE LETTERS OF CREDIT AS BANK MAY REASONABLY REQUEST.
(B)
THE OBLIGATION OF BORROWER TO IMMEDIATELY
REIMBURSE BANK FOR DRAWINGS MADE UNDER LETTERS OF CREDIT SHALL BE ABSOLUTE,
UNCONDITIONAL AND IRREVOCABLE, AND SHALL BE PERFORMED STRICTLY IN ACCORDANCE
WITH THE TERMS OF THIS AGREEMENT AND SUCH LETTERS OF CREDIT, AND SUCH LETTER OF
CREDIT APPLICATION.
BORROWER SHALL INDEMNIFY, DEFEND, PROTECT,
AND HOLD BANK
HARMLESS FROM ANY LOSS, COST, EXPENSE OR LIABILITY, INCLUDING, WITHOUT
LIMITATION, REASONABLE ATTORNEYS' FEES, ARISING OUT OF OR IN CONNECTION WITH ANY
LETTERS OF CREDIT, EXCEPT TO THE EXTENT ANY SUCH LOSS, COST, EXPENSE OR
LIABILITY WAS DUE TO BANK'S GROSS NEGLIGENCE OR WILLFUL MISCONDUCT.
(C)
BORROWER MAY REQUEST THAT BANK ISSUE A
LETTER OF CREDIT PAYABLE IN A CURRENCY OTHER THAN UNITED STATES DOLLARS.
IF A
DEMAND FOR PAYMENT IS MADE UNDER ANY SUCH LETTER OF CREDIT, BANK SHALL TREAT
SUCH DEMAND AS AN ADVANCE TO BORROWER OF THE EQUIVALENT OF THE AMOUNT THEREOF
(PLUS FEES AND CHARGES IN CONNECTION THEREWITH SUCH AS WIRE, CABLE, SWIFT OR
SIMILAR CHARGES) IN UNITED STATES CURRENCY AT THE THEN PREVAILING RATE OF
EXCHANGE IN SAN FRANCISCO, CALIFORNIA, FOR SALES OF THAT OTHER CURRENCY FOR
TRANSFER TO THE COUNTRY OF WHICH IT IS THE CURRENCY.
(D)
UPON THE ISSUANCE OF ANY LETTER OF CREDIT
PAYABLE IN A CURRENCY OTHER THAN UNITED STATES DOLLARS, BANK SHALL CREATE A
RESERVE (THE "LETTER OF CREDIT RESERVE") UNDER THE REVOLVING LINE FOR LETTERS OF
CREDIT AGAINST FLUCTUATIONS IN CURRENCY EXCHANGE RATES, IN AN AMOUNT EQUAL TO
TEN