(Y) AN AMOUNT EQUAL TO (I)
THE BORROWING AVAILABILITY MINUS (II) THE RESERVES.
THE AMOUNT DERIVED AT ANY
TIME FROM SECTION 2(A)(I)(Y)(I) MINUS 2(A)(I)(Y)(II) SHALL BE REFERRED TO AS THE
"FORMULA AMOUNT".
COMPANY SHALL EXECUTE AND DELIVER TO LAURUS ON THE CLOSING
DATE A MINIMUM BORROWING NOTE AND A REVOLVING NOTE EVIDENCING THE LOANS FUNDED
ON THE CLOSING DATE.
FROM TIME TO TIME THEREAFTER, COMPANY SHALL EXECUTE AND
DELIVER TO LAURUS IMMEDIATELY PRIOR TO THE FINAL FUNDING OF EACH ADDITIONAL
$1,000,000 TRANCHE OF LOANS (CALCULATED ON A CUMULATIVE BASIS FOR EACH SUCH
TRANCHE) AN ADDITIONAL MINIMUM BORROWING NOTE EVIDENCING SUCH TRANCHE, IN THE
FORM OF NOTE DELIVERED BY COMPANY TO LAURUS ON THE CLOSING DATE.
(II)
NOTWITHSTANDING THE LIMITATIONS SET FORTH ABOVE, IF REQUESTED BY
THE COMPANY, LAURUS RETAINS THE RIGHT TO LEND TO COMPANY FROM TIME TO TIME SUCH
AMOUNTS IN EXCESS OF SUCH LIMITATIONS AS LAURUS MAY DETERMINE IN ITS SOLE
DISCRETION.
(III)
COMPANY ACKNOWLEDGES THAT THE EXERCISE OF LAURUS' DISCRETIONARY
RIGHTS HEREUNDER MAY RESULT DURING THE TERM IN ONE OR MORE INCREASES OR
DECREASES IN THE ADVANCE PERCENTAGES USED IN DETERMINING ACCOUNTS AVAILABILITY
AND COMPANY HEREBY CONSENTS TO ANY SUCH INCREASES OR DECREASES WHICH MAY LIMIT
OR RESTRICT ADVANCES REQUESTED BY COMPANY.
(IV)
IF COMPANY DOES NOT PAY ANY INTEREST, FEES, COSTS OR CHARGES TO
LAURUS WHEN DUE, COMPANY SHALL THEREBY BE DEEMED TO HAVE REQUESTED, AND LAURUS
IS HEREBY AUTHORIZED AT ITS DISCRETION TO MAKE AND CHARGE TO COMPANY'S ACCOUNT,
A LOAN TO COMPANY AS OF SUCH DATE IN AN AMOUNT EQUAL TO SUCH UNPAID INTEREST,
FEES, COSTS OR CHARGES.
(V)
IF THE COMPANY AT ANY TIME FAILS TO PERFORM OR OBSERVE ANY OF THE
COVENANTS CONTAINED IN THIS AGREEMENT OR ANY ANCILLARY AGREEMENT, AFTER ANY
APPLICABLE NOTICE AND OPPORTUNITY TO CURE, LAURUS MAY, BUT NEED NOT, PERFORM OR
OBSERVE SUCH COVENANT ON BEHALF AND IN THE NAME, PLACE AND STEAD OF COMPANY (OR,
AT LAURUS' OPTION, IN LAURUS' NAME) AND MAY, BUT NEED NOT, TAKE ANY AND ALL
OTHER ACTIONS WHICH LAURUS MAY DEEM NECESSARY TO CURE OR CORRECT SUCH FAILURE
(INCLUDING THE PAYMENT OF TAXES, THE SATISFACTION OF LIENS, THE PERFORMANCE OF
OBLIGATIONS OWED TO ACCOUNT DEBTORS, LESSORS OR OTHER OBLIGORS, THE PROCUREMENT
AND MAINTENANCE OF INSURANCE, THE EXECUTION OF ASSIGNMENTS, SECURITY AGREEMENTS
AND FINANCING STATEMENTS, AND THE ENDORSEMENT OF INSTRUMENTS).
THE AMOUNT OF
ALL MONIES EXPENDED AND ALL COSTS AND EXPENSES (INCLUDING ATTORNEYS' FEES AND
LEGAL EXPENSES) INCURRED BY LAURUS IN CONNECTION WITH OR AS A RESULT OF THE
PERFORMANCE OR OBSERVANCE OF SUCH AGREEMENTS OR THE TAKING OF SUCH ACTION BY
LAURUS SHALL BE CHARGED TO COMPANY'S ACCOUNT AS A LOAN AND ADDED TO THE
OBLIGATIONS.
TO FACILITATE LAURUS' PERFORMANCE OR OBSERVANCE OF SUCH COVENANTS
OF COMPANY, UPON THE OCCURRENCE AND CONTINUANCE OF AN EVENT OF DEFAULT BEYOND
ANY APPLICABLE NOTICE AND
2
cure period, the Company hereby irrevocably appoints Laurus, or Laurus'
delegate, acting alone, as Company's attorney in fact (which appointment is
coupled with an interest) with the right