cannot sent mail with 10.8,4

Is this a Gmail issue ?

I have been sending mail successfully for a while, but i recently updated to 10.8.4, all was fine, till today, constantly get a popup asking Mail wants my password.

I use IMAP with Gmail with an "Application specific password".

Must I revoke this, and get new password ? As it's been fine.

ANyone having this issue ? I guess the workaround could be login via web and sent mail.