BORROWING BASE REPORT

Accounts and Inventory
{ Manufacturers - RAW Materials, Work-In-Progress & Finished Goods }

Borrowing Base Report for Period Beginning: and Ending ("Current Period") required by the
Loan Agreement dated the Effective Date (as amended, restated and supplemented from time to time, the "Agreement" by
and between and United Bank of El Paso del Norte.


 


LINE 1. Total Accounts that have been earned and invoiced within days.
(NOTE: OBTAIN FROM THE A/R AGING REPORT PROVIDED BY THE BORROWER)
  $
  2. That portion (e.g., invoice) of all the Accounts of any Account Debtor where the Account is more than 90 days from invoice date. $  
  3. All of the Accounts, not already included in Line 2, of any Accounts Debtor if 20% of the dollar amount of all the Accounts of such Account Debtor are more 90 days of invoice date. $  
  4. That portion of all of the Accounts of any Account Debtor which exceeds 10% of the dollar amount of the total of all Accounts for all Account Debtor for the Current Period (Line 1). $  
  Ineligible Accounts as of the end of the Current Period  
  5. Intercompany and Affiliate Accounts $  
  6. Government Accounts [Government Accounts means receivables owned by the U.S. government or by the government of any state, county, municipality, or other political subdivision as to which Bank's security interest or ability to obtain direct payment of the proceeds is governed by any federal or state statutory requirements other than those of the Uniform Commercial Code, including, without limitation, the Federal Assignment of Claims Act of 1940, as amended]. $  
  7. Foreign Accounts [unless secured by a letter of credit issued by a bank satisfactory to the Bank]. $  
  8. Accounts subject to any dispute or setoff or contra account $  
  9. Other Ineligible Accounts $  
  10. Total Ineligible Accounts for the Current Period (Add Lines 2 through 9)   $
  11. Total Eligible Account for the Current Period (Line 1 - Line 10)   $
  12. Multiplied by: Accounts Advance Factor   x %
  13. Equals: Accounts Component of Borrowing Base   $
  14. Total Inventory as of the end of the Current Period   $
  Ineligible Inventory as of the end of the Current Period:  
  15. Damaged or Obsolete Inventory $  
  16. Other Ineligible Inventory $  
  17. Total Ineligible Inventory as of the end of the Current Period (Line 15 + Line 16)   $
  18. Total Eligible Inventory as of the end of the Current Period (Line 14 - Line 17)   $
  19. Total Raw Material Component of Eligible Inventory   $
  20. Multiplied by: Raw Material Factor   x %
  21. Equals: Eligible Raw Material Component of Borrowing Base   $
  22. Total Work-In-Process Component of Eligible Inventory   $
  23. Multiplied by: Work-In-Process Factor   x %
  24. Equals: Eligible Work-In-Process Component of Borrowing Base   $
  25. Total finished Good Component of Eligible Inventory   $
  26. Multiplied by: Finished Goods Factor   x %
  27. Equals: Eligible Finished Goods Component of Borrowing Base   $
  28. Eligible Inventory Component of Borrowing Base   $
  (Line 21 + Line 24 + Line 27) (Not to exceed the lesser of
$ or 50% of the Borrowing Base)
 
  29. Total BORROWING BASE (not to exceed $)
as of the end of the Current Period (Line 13 + Line 28)
$  
  30. Less: Aggregate principal amount outstanding under the Note as of the Current under the Note as of the end of the Current Period.   $
  31. Equals: Amount Available for Borrowing subject to the terms of the Agreement, if positive; or amount due, if negative.   $
   

The term "Accounts" and "Inventory" have the respective meanings as set forth in the Texas Business and Commerce Code in effect as of the date of the Agreement. Inventory shall be valued at the lesser of: (a) market value; and (b) cost. "Other Ineligible Accounts" means all such Accounts of Borrower that are not subject to a first and prior Lien in favor of the Bank, Accounts that are subject to any Lien not in favor of Bank and those Accounts of Borrower as shall be deemed from the time to be, in the sole judgment of Bank, ineligible for purposes of determining the Borrowing Base. "Other Ineligible Inventory" means that Inventory of Borrower that is not subject to a first and prior Lien in favor of Bank, that Inventory that is subject to any Lien not in favor of Bank of that Inventory of Borrower as shall be deemed from time to time to be in the sole judgment of Bank, ineligible for purposes of determining the Borrowing Base. All other terms not defined herein shall have the respective meanings as in the Agreement.

Borrower certifies that the above information and computations are true, correct, complete and not misleading as of the date thereof.

Borrower:
By:
Name:
Title:
Date: