\n Section 8.1. Events of Default…………………………………………….. 36
\n Section 8.2. Remedies…………………………………………………….. 39
\nARTICLE IX – Agent………………………………………………………………… 39
\n Section 9.1. Appointment and Authority……………………………………… 39
\n Section 9.2. Exculpation, Agent’s Reliance, Etc……………………………… 39
\n Section 9.3. Credit Decisions……………………………………………… 40
\n Section 9.4. Indemnification………………………………………………. 40
\n Section 9.5. Rights as Lender……………………………………………… 41
\n Section 9.6. Sharing of Set-Offs and Other Payments………………………….. 41
\n Section 9.7. Investments………………………………………………….. 41
\n Section 9.8. Benefit of Article IX…………………………………………. 42
\n Section 9.9. Resignation………………………………………………….. 42<\/p>\nARTICLE X – Miscellaneous………………………………………………………….. 42
\n Section 10.1. Waivers and Amendments; Acknowledgments…………………………. 42
\n Section 10.2. Survival of Agreements; Cumulative Nature……………………….. 44
\n Section 10.3. Notices……………………………………………………… 44
\n Section 10.4. Payment of Expenses; Indemnity…………………………………. 45
\n Section 10.5. Joint and Several Liability; Parties in Interest; Assignments……… 46
\n Section 10.6. Confidentiality………………………………………………. 48
\n Section 10.7. Governing Law; Submission to Process……………………………. 48
\n Section 10.8. Limitation on Interest………………………………………… 49
\n Section 10.9. Termination; Limited Survival………………………………….. 50
\n Section 10.10. Severability…………………………………………………. 50
\n Section 10.11. Counterparts…………………………………………………. 50
\n Section 10.12. Waiver of Jury Trial, Punitive Damages, etc……………………… 50
\n Section 10.13. Restatement; Ratification of Agreements…………………………. 51
\n<\/c><\/s><\/table>\n
iii
\n 5<\/p>\n
Schedules and Exhibits:<\/p>\n
Lender Schedule<\/p>\n
Schedule 1 – Disclosure Schedule
\nSchedule 2 – Security Schedule
\nSchedule 3 – Insurance Schedule<\/p>\n
Exhibit A – Promissory Note
\nExhibit B – Request for Loan
\nExhibit C – Continuation\/Conversion Notice
\nExhibit D – Certificate Accompanying Financial Statements
\nExhibit E – Assignment and Acceptance
\nExhibit F – Opinion of Counsel for Borrower
\nExhibit G – Subsidiary Guaranty
\nExhibit H – Parent Security Agreement<\/p>\n
iv<\/p>\n
6<\/p>\n
AMENDED AND RESTATED CREDIT AGREEMENT<\/p>\n
THIS AMENDED AND RESTATED CREDIT AGREEMENT is made as of DECEMBER 21,
\n1999, by and among STB Systems, Inc., a Texas corporation, doing business in the
\nState of Texas under the name of 3Dfx of Texas, Inc. (herein called “BORROWER”),
\nBank One, Texas, N.A., individually and as agent (herein called “AGENT”) and the
\nLenders referred to below. In consideration of the mutual covenants and
\nagreements contained herein the parties hereto agree as follows:<\/p>\n
ARTICLE I – Definitions and References<\/p>\n
Section 1.1. Defined Terms. As used in this Agreement, each of the
\nfollowing terms has the meaning given it in this Section 1.1 or in the sections
\nand subsections referred to below:<\/p>\n
“AFFILIATE” means, as to any Person, each other Person that directly or
\nindirectly (through one or more intermediaries or otherwise) controls, is
\ncontrolled by, or is under common control with, such Person. A Person shall be
\ndeemed to be “controlled by” any other Person if such other Person possesses,
\ndirectly or indirectly, power<\/p>\n
(a) to vote 50% or more of the securities (on a fully diluted
\n basis) having ordinary voting power for the election of directors or
\n managing general partners; or<\/p>\n
(b) to direct or cause the direction of the management and policies
\n of such Person whether by contract or otherwise.<\/p>\n
“AGENT” means Bank One, Texas, N.A., as Agent hereunder, and its
\nsuccessors in such capacity.<\/p>\n
“AGREEMENT” means this Credit Agreement.<\/p>\n
“APPLICABLE EURODOLLAR RATE MARGIN” means one percent (1.00%) per annum.<\/p>\n
“BANK ONE” means Bank One, Texas, N.A., in its capacity as a Lender
\nhereunder.<\/p>\n
“BANK PARTIES” means Agent and all Lenders.<\/p>\n
“BASE RATE” means the higher of (a) the Prime Rate and (b) the Federal
\nFunds Rate, plus one-half percent (0.5%) per annum. If the Prime Rate or the
\nFederal Funds Rate changes after the date hereof the Base Rate shall be
\nautomatically increased or decreased, as the case may be, without notice to
\nBorrower from time to time as of the effective time of each change in the Prime
\nRate. The Base Rate shall in no event, however, exceed the Highest Lawful Rate.<\/p>\n
“BASE RATE LOAN” means a Loan which does not bear interest at the
\nEurodollar Rate.<\/p>\n
7<\/p>\n
“BORROWER” means STB Systems, Inc., a Texas corporation.<\/p>\n
“BORROWER’S MINIMUM ELIGIBLE RECEIVABLES” means at the particular time
\nin question, an amount equal to the amount determined by Agent from time to time
\nin its reasonable judgment (which judgment shall be exercised in good faith)
\nequal to the face amount of Eligible Receivables.<\/p>\n
“BORROWING” means a borrowing of new Loans of a single Type pursuant to
\nSection 2.2 or a continuation or conversion of existing Loans into a single Type
\n(and, in the case of Eurodollar Loans, with the same Interest Period) pursuant
\nto Section 2.3.<\/p>\n
“BORROWING BASE” means at the particular time in question, an amount
\nequal to the fair market value of the Marketable Securities Collateral
\ndetermined by Agent from time to time in its reasonable judgment (which judgment
\nshall be exercised in good faith); provided that in no event shall the Borrowing
\nBase exceed the Commitment.<\/p>\n
“BORROWING BASE DEFICIENCY” has the meaning given it in Section 2.7(b).<\/p>\n
“BORROWING BASE REPORT” means a report describing the Marketable
\nSecurities Collateral in a form acceptable to Agent, prepared by Securities
\nIntermediary (and, upon request of Agent, copies of other information relating
\nto the Marketable Securities Collateral).<\/p>\n
“BUSINESS DAY” means a day, other than a Saturday or Sunday, on which
\ncommercial banks are open for business with the public in Dallas, Texas. Any
\nBusiness Day in any way relating to Eurodollar Loans (such as the day on which
\nan Interest Period begins or ends) must also be a day on which, in the judgment
\nof Agent, significant transactions in dollars are carried out in the interbank
\neurocurrency market.<\/p>\n
“COLLATERAL” means all property of any kind which is subject to a Lien
\nin favor of Lenders (or in favor of Agent for the benefit of Lenders) or which,
\nunder the terms of any Security Document, is purported to be subject to such a
\nLien.<\/p>\n
“COMMITMENT” means the amount of $25,000,000.<\/p>\n
“COMMITMENT PERIOD” means the period from and including the date hereof
\nuntil and including the Maturity Date (or, if earlier, the day on which any of
\nthe Notes first becomes due and payable in full).<\/p>\n
“CONSOLIDATED” refers to the consolidation of any Person, in accordance
\nwith GAAP, with its properly consolidated subsidiaries. References herein to a
\nPerson’s Consolidated financial statements, financial position, financial
\ncondition, liabilities, etc. refer to the consolidated financial statements,
\nfinancial position, financial condition, liabilities, etc. of such Person and
\nits properly consolidated subsidiaries.<\/p>\n
2
\n 8<\/p>\n
“CONSOLIDATED BORROWER” means Borrower and Parent.<\/p>\n
“CONSOLIDATED DEBT” means all Consolidated Indebtedness of Consolidated
\nBorrower that would under GAAP be shown on Consolidated Borrower’s Consolidated
\nbalance sheet as a liability.<\/p>\n
“CONSOLIDATED NET WORTH” means, for any period, the total shareholder’s
\nequity as reported on Consolidated Borrower’s Consolidated Financial Statement
\nas reported to the Securities and Exchange Commission and\/or Shareholders, or if
\nConsolidated Borrower’s total shareholder’s equity is not so reported,
\nConsolidated Borrower’s Consolidated total shareholder’s equity calculated in
\naccordance with GAAP.<\/p>\n
“CONTINUATION\/CONVERSION NOTICE” means a written or telephonic request,
\nor a written confirmation, made by Borrower which meets the requirements of
\nSection 2.3.<\/p>\n
“DEFAULT” means any Event of Default and any default, event or condition
\nwhich would, with the giving of any requisite notices and the passage of any
\nrequisite periods of time, constitute an Event of Default.<\/p>\n
“DEFAULT RATE” means, at the time in question (a) with respect to any
\nBase Rate Loan, the rate per annum equal to two percent (2.0%) above the Base
\nRate then in effect and (b) with respect to any Eurodollar Loan, the rate per
\nannum equal to two percent (2.0%) above the Eurodollar Rate then in effect for
\nsuch Loan, provided in each case that no Default Rate charged by any Person
\nshall ever exceed the Highest Lawful Rate.<\/p>\n
“DISCLOSURE REPORT” means either a notice given by Borrower under
\nSection 6.4 or a certificate given by Borrower’s chief financial officer under
\nSection 6.2(b).<\/p>\n
“DISCLOSURE SCHEDULE” means Schedule 1 hereto.<\/p>\n
“ELIGIBLE RECEIVABLES” means at any time an amount equal to the
\naggregate net invoice or ledger amount owing on all trade accounts receivable of
\nBorrower for goods sold or services rendered, in which Agent has a perfected,
\nfirst priority security interest after deducting (a) any account that is owed by
\nthe United States or any department, agency or instrumentality thereof, and (b)
\nall such accounts owing by Affiliates of Borrower or by officers or employees of
\nBorrower or any such Affiliate.<\/p>\n
“ELIGIBLE TRANSFEREE” means a Person which either (a) is a Lender or an
\nAffiliate of a Lender, and (b) is consented to as an Eligible Transferee by
\nAgent (provided that no Person organized outside the United States may be an
\nEligible Transferee if Borrower would be required to pay withholding taxes on
\ninterest or principal owed to such Person).<\/p>\n
“ENVIRONMENTAL LAWS” means any and all Laws relating to the environment
\nor to emissions, discharges, releases or threatened releases of pollutants,
\ncontaminants, chemicals, or<\/p>\n
3
\n 9<\/p>\n
industrial, toxic or hazardous substances or wastes into the environment
\nincluding ambient air, surface water, ground water, or land, or otherwise
\nrelating to the manufacture, processing, distribution use, treatment, storage,
\ndisposal, transport, or handling of pollutants, contaminants, chemicals, or
\nindustrial, toxic or hazardous substances or wastes.<\/p>\n
“ERISA” means the Employee Retirement Income Security Act of 1974, as
\namended from time to time, together with all rules and regulations promulgated
\nwith respect thereto.<\/p>\n
“ERISA PLAN” means any employee pension benefit plan subject to Title IV
\nof ERISA maintained by any Restricted Person with respect to which any
\nRestricted Person has a fixed or contingent liability.<\/p>\n
“EURODOLLAR LOAN” means a Loan which is properly designated as a
\nEurodollar Loan pursuant to Section 2.2 or 2.3.<\/p>\n
“EURODOLLAR RATE” means, with respect to each particular Eurodollar Loan
\nand the associated LIBOR Rate and Reserve Percentage, the rate per annum
\ncalculated by Agent (rounded upwards, if necessary, to the next higher 0.01%)
\ndetermined on a daily basis pursuant to the following formula:<\/p>\n
Eurodollar Rate =<\/p>\n
LIBOR Rate + Applicable Eurodollar Rate Margin
\n ———————-
\n 100.0% – Reserve Percentage<\/p>\n
The Eurodollar Rate for any Eurodollar Loan shall change whenever the Applicable
\nEurodollar Rate Margin or the Reserve Percentage changes. No Eurodollar Rate
\nshall ever exceed the Highest Lawful Rate.<\/p>\n
“EVENT OF DEFAULT” has the meaning given it in Section 8.1.<\/p>\n
“FACILITY USAGE” means, at the time in question, the aggregate amount of
\noutstanding Loans at such time.<\/p>\n
“FEDERAL FUNDS RATE” shall mean, for any day, the rate per annum
\n(rounded upwards, if necessary, to the nearest 1\/100th of one percent) equal to
\nthe weighted average of the rates on overnight Federal funds transactions with
\nmembers of the Federal Reserve System arranged by Federal funds brokers on such
\nday, as published by the Federal Reserve Bank of New York on the Business Day
\nnext succeeding such day, provided that (i) if the day for which such rate is to
\nbe determined is not a Business Day, the Federal Funds Rate for such day shall
\nbe such rate on such transactions on the next preceding Business Day as so
\npublished on the next succeeding Business Day, and (ii) if such rate is not so
\npublished for any day, the Federal Funds Rate for such day shall be the average
\nrate quoted to Agent on such day on such transactions as determined by Agent.<\/p>\n
4
\n 10<\/p>\n
“FISCAL QUARTER” means a three-month period ending on January 31, April
\n30, July 31 or October 31 of any year.<\/p>\n
“FISCAL YEAR” means a twelve-month period ending on January 31 of any
\nyear.<\/p>\n
“GAAP” means those generally accepted accounting principles and
\npractices which are recognized as such by the Financial Accounting Standards
\nBoard (or any generally recognized successor) and which, in the case of Borrower
\nand its Consolidated subsidiaries, are applied for all periods after the date
\nhereof in a manner consistent with the manner in which such principles and
\npractices were applied to the audited Initial Financial Statements. If any
\nchange in any accounting principle or practice is required by the Financial
\nAccounting Standards Board (or any such successor) in order for such principle
\nor practice to continue as a generally accepted accounting principle or
\npractice, all reports and financial statements required hereunder with respect
\nto Borrower or with respect to Borrower and its Consolidated subsidiaries.<\/p>\n
“GUARANTOR” means any Person who has guaranteed the Obligations pursuant
\nto a guaranty listed on the Security Schedule or any other Person who has
\nguaranteed the Obligations and who has been accepted by Agent as a Guarantor or
\nany Subsidiary of Borrower which now or hereafter executes and delivers a
\nguaranty to Agent pursuant to Section 6.17.<\/p>\n
“HAZARDOUS MATERIALS” means any substances regulated under any
\nEnvironmental Law, whether as pollutants, contaminants, or chemicals, or as
\nindustrial, toxic or hazardous substances or wastes, or otherwise.<\/p>\n
“HEDGING CONTRACT” means (a) any agreement providing for options, swaps,
\nfloors, caps, collars, forward sales or forward purchases involving interest
\nrates, commodities or commodity prices, equities, currencies, bonds, or indexes
\nbased on any of the foregoing, (b) any option, futures or forward contract
\ntraded on an exchange, and (c) any other derivative agreement or other similar
\nagreement or arrangement.<\/p>\n
“HIGHEST LAWFUL RATE” means, with respect to each Lender, the maximum
\nnonusurious rate of interest that such Lender is permitted under applicable Law
\nto contract for, take, charge, or receive with respect to its Loan. All
\ndeterminations herein of the Highest Lawful Rate, or of any interest rate
\ndetermined by reference to the Highest Lawful Rate, shall be made separately for
\neach Lender as appropriate to assure that the Loan Documents are not construed
\nto obligate any Person to pay interest to any Lender at a rate in excess of the
\nHighest Lawful Rate applicable to such Lender.<\/p>\n
“INDEBTEDNESS” of any Person means Liabilities in any of the following
\ncategories:<\/p>\n
(a) Liabilities for borrowed money,<\/p>\n
(b) Liabilities constituting an obligation to pay the deferred purchase
\nprice of property or services,<\/p>\n
5
\n 11
\n (c) Liabilities evidenced by a bond, debenture, note or similar
\ninstrument,<\/p>\n
(d) Liabilities which would under GAAP be shown on such Person’s balance
\nsheet as a liability,<\/p>\n
(e) Liabilities arising under Hedging Contracts,<\/p>\n
(f) Liabilities constituting principal under leases capitalized in
\naccordance with GAAP,<\/p>\n
(g) Liabilities arising under conditional sales or other title retention
\nagreements,<\/p>\n
(h) Liabilities owing under direct or indirect guaranties of Liabilities
\nof any other Person or constituting obligations to purchase or acquire or to
\notherwise protect or insure a creditor against loss in respect of Liabilities of
\nany other Person (such as obligations under working capital maintenance
\nagreements, agreements to keep-well, or agreements to purchase Liabilities,
\nassets, goods, securities or services), but excluding endorsements in the
\nordinary course of business of negotiable instruments in the course of
\ncollection,<\/p>\n
(i) Liabilities (for example, repurchase agreements) consisting of an
\nobligation to purchase securities or other property, if such Liabilities arises
\nout of or in connection with the sale of the same or similar securities or
\nproperty,<\/p>\n
(j) Liabilities with respect to letters of credit or applications or
\nreimbursement agreements therefor, or<\/p>\n
(k) Liabilities with respect to other obligations to deliver goods or
\nservices in consideration of advance payments therefor;<\/p>\n
provided, however, that the “INDEBTEDNESS” of any Person shall not include
\nLiabilities that were incurred by such Person on ordinary trade terms to
\nvendors, suppliers, or other Persons providing goods and services for use by
\nsuch Person in the ordinary course of its business, unless and until such
\nLiabilities are outstanding more than 90 days past the original invoice or
\nbilling date therefor.<\/p>\n
“INITIAL FINANCIAL STATEMENTS” means (i) the audited annual Consolidated
\nfinancial statements of Consolidated Borrower dated as of October 31, 1999, and
\n(ii) the unaudited quarterly Consolidated financial statements of Consolidated
\nBorrower dated as of July 31, 1999.<\/p>\n
“INSTRUMENTS” has the meaning given it in the UCC.<\/p>\n
“INSURANCE SCHEDULE” means Schedule 3 attached hereto.<\/p>\n
6
\n 12<\/p>\n
“INTEREST PERIOD” means, with respect to each particular Eurodollar Loan
\nin a Borrowing, a period of 1, 2, 3, or 6 months, as specified in the Request
\nfor Loan applicable thereto, beginning on and including the date specified in
\nsuch Request for Loan (which must be a Business Day), and ending on but not
\nincluding the same day of the month as the day on which it began (e.g., a period
\nbeginning on the third day of one month shall end on but not include the third
\nday of another month), provided that each Interest Period which would otherwise
\nend on a day which is not a Business Day shall end on the next succeeding
\nBusiness Day (unless such next succeeding Business Day is the first Business Day
\nof a calendar month, in which case such Interest Period shall end on the
\nimmediately preceding Business Day). No Interest Period may be elected which
\nwould extend past the date on which the associated Note is due and payable in
\nfull.<\/p>\n
“INVESTMENT” means any investment, in cash or by delivery of property
\nmade, directly or indirectly in any Person, whether by acquisition of shares of
\ncapital stock, indebtedness or other obligations or securities or by loan,
\nadvance, capital contribution or otherwise.<\/p>\n
“LAW” means any statute, law, regulation, ordinance, rule, treaty,
\njudgment, order, decree, permit, concession, franchise, license, agreement or
\nother governmental restriction of the United States or any state or political
\nsubdivision thereof or of any foreign country or any department, province or
\nother political subdivision thereof.<\/p>\n
“LENDERS” means each signatory hereto (other than Borrower and
\nRestricted Persons a party hereto), including Bank One and the successors of
\neach such party as holder of a Note.<\/p>\n
“LENDING OFFICE” means, with respect to any Lender, the office, branch,
\nor agency through which it funds its Eurodollar Loans; and, with respect to
\nAgent or Collateral Agent, the office, branch, or agency through which it
\nadministers this Agreement.<\/p>\n
“LIABILITIES” means, as to any Person, all indebtedness, liabilities and
\nobligations of such Person, whether matured or unmatured, liquidated or
\nunliquidated, primary or secondary, direct or indirect, absolute, fixed or
\ncontingent and whether or not required to be considered pursuant to GAAP.<\/p>\n
“LIBOR RATE” means, with respect to each particular Eurodollar Loan for
\nthe related Interest Period, the applicable British Bankers’ Association
\nInterest Settlement Rate (rounded upwards, if necessary, to the nearest 1\/16 of
\n1%) for deposits in U.S. dollars appearing on Reuters Screen FRBD as of 11:00
\na.m. (London time) two Business Days prior to the first day of such Interest
\nPeriod, and having a maturity equal to such Interest Period, provided that, (i)
\nif Reuters Screen FRBD is not available to the Agent for any reason, the
\napplicable LIBOR Rate for the relevant Interest Period shall instead be the
\napplicable British Bankers’ Association Interest Settlement Rate for deposits in
\nU.S. dollars as reported by any other generally recognized financial information
\nservice as of 11:00 a.m. (London time) two Business Days prior to the first day
\nof such Interest Period, and having a maturity equal to such Interest Period,
\nand (ii) if no such British Bankers’ Association Interest Settlement Rate is
\navailable to the Agent, the applicable LIBOR Rate for the relevant Interest
\nPeriod shall instead be the rate determined by the<\/p>\n
7
\n 13<\/p>\n
Agent to be the rate at which Bank One or one of its Affiliate banks offers to
\nplace deposits in U.S. dollars with first-class banks in the London interbank
\nmarket at approximately 11:00 a.m. (London time) two Business Days prior to the
\nfirst day of such Interest Period, in the approximate amount of such Eurodollar
\nLoan and having a maturity equal to such Interest Period.<\/p>\n
“LIEN” means, with respect to any property or assets, any right or
\ninterest therein of a creditor to secure Liabilities owed to him or any other
\narrangement with such creditor which provides for the payment of such
\nLiabilities out of such property or assets or which allows him to have such
\nLiabilities satisfied out of such property or assets prior to the general
\ncreditors of any owner thereof, including any lien, mortgage, security interest,
\npledge, deposit, production payment, rights of a vendor under any title
\nretention or conditional sale agreement or lease substantially equivalent
\nthereto, tax lien, mechanic’s or materialman’s lien, or any other charge or
\nencumbrance for security purposes, whether arising by Law or agreement or
\notherwise, but excluding any right of offset which arises without agreement in
\nthe ordinary course of business. “LIEN” also means any filed financing
\nstatement, any registration of a pledge (such as with an issuer of
\nuncertificated securities), or any other arrangement or action which would serve
\nto perfect a Lien described in the preceding sentence, regardless of whether
\nsuch financing statement is filed, such registration is made, or such
\narrangement or action is undertaken before or after such Lien exists.<\/p>\n
“LOANS” has the meaning given it in Section 2.1.<\/p>\n
“LOAN DOCUMENTS” means this Agreement, the Notes, the Security
\nDocuments, and all other agreements, certificates, documents, instruments and
\nwritings at any time delivered in connection herewith or therewith (exclusive of
\nterm sheets, commitment letters, correspondence and similar documents used in
\nthe negotiation hereof, except to the extent the same contain information about
\nBorrower or its Affiliates, properties, business or prospects).<\/p>\n
“MAJORITY LENDERS” means Agent and Lenders whose aggregate Percentage
\nShares equal or exceed sixty-six and two-thirds percent (66 2\/3%).<\/p>\n
“MARKETABLE SECURITIES COLLATERAL” means, at any time, all Securities,
\nInstruments, funds and other property, now or at any time hereafter on deposit
\nin the Securities Account.<\/p>\n
“MATERIAL ADVERSE CHANGE” means a material and adverse change, from the
\nstate of affairs presented in the Initial Financial Statements, to (a)
\nBorrower’s and its Subsidiaries’ Consolidated financial condition, (b) the
\noperations or properties of Borrower and its Subsidiaries, considered as a
\nwhole, (c) Borrower’s ability to timely pay the Obligations, or (d) the
\nenforceability of the material terms of any Loan Documents.<\/p>\n
“MATURITY DATE” means December 19, 2000.<\/p>\n
“NOTES” has the meaning given it in Section 2.1.<\/p>\n
8
\n 14<\/p>\n
“OBLIGATIONS” means all Liabilities from time to time owing by any
\nRestricted Person to any Bank Party under or pursuant to any of the Loan
\nDocuments. “OBLIGATION” means any part of the Obligations.<\/p>\n
“PARENT” means 3Dfx Interactive, Inc., a California corporation.<\/p>\n
“PERCENTAGE SHARE” means, with respect to any Lender (a) when used in
\nSections 2.1 or 2.5, in any Request for Loan or when no Loans are outstanding
\nhereunder, the percentage set forth opposite such Lender’s name on Lender
\nSchedule attached hereto, and (b) when used otherwise, the percentage obtained
\nby dividing (i) the sum of the unpaid principal balance of such Lender’s Loans
\nat the time in question, by (ii) the sum of the aggregate unpaid principal
\nbalance of all Loans at such time.<\/p>\n
“PERMITTED INVESTMENTS” means Investments in:<\/p>\n
(a) marketable obligations, maturing within 12 months after acquisition
\nthereof, issued or unconditionally guaranteed by the United States of America or
\nan instrumentality or agency thereof and entitled to the full faith and credit
\nof the United States of America and securities purchased within the Bank One
\nInvestment Advisors program.<\/p>\n
(b) demand deposits, and time deposits (including certificates of
\ndeposit) maturing within 12 months from the date of deposit thereof, with any
\noffice of Bank One or with a domestic office of any national or state bank or
\ntrust company which is organized under the Laws of the United States of America
\nor any state therein, which has capital, surplus and undivided profits of at
\nleast $500,000,000, and whose certificates of deposit have at least the third
\nhighest credit rating given by either Rating Agency.<\/p>\n
(c) repurchase obligations with a term of not more than seven days for
\nunderlying securities of the types described in clause (a) above entered into
\nwith any commercial bank meeting the specifications of clause (b) above.<\/p>\n
(d) open market commercial paper, maturing within 270 days after
\nacquisition thereof, which has the highest or second highest credit rating given
\nby either Rating Agency.<\/p>\n
(e) investments in money market or other mutual funds substantially all
\nof whose assets comprise securities of the types described in clauses (a)
\nthrough (d) above.<\/p>\n
(f) in joint ventures, so long as Agent is given 10 days advance notice
\nof each such investment and the aggregate amount paid, contributed, lent or
\notherwise invested after the date hereof by the Restricted Persons in joint
\nventures does not exceed $1,000,000.<\/p>\n
“PERMITTED LIEN” has the meaning given to such term in Section 7.2.<\/p>\n
9
\n 15<\/p>\n
“PERSON” means an individual, corporation, partnership, limited
\nliability company, association, joint stock company, trust or trustee thereof,
\nestate or executor thereof, unincorporated organization or joint venture,
\nTribunal, or any other legally recognizable entity.<\/p>\n
“PRIME RATE” means a rate per annum equal to the prime rate of interest
\nannounced from time to time by Agent or its parent (which is not necessarily the
\nlowest rate charged to any customer), changing when and as said prime rate
\nchanges.<\/p>\n
“RATING AGENCY” means either Standard & Poor’s Ratings Group (a division
\nof McGraw Hill, Inc.) or Moody’s Investors Service, Inc., or their respective
\nsuccessors.<\/p>\n
“RECEIVABLES REPORT” means a report describing the Eligible Receivables
\nin a form acceptable to Agent, together with a detailed aged schedule of all
\nEligible Receivables as of the date specified in such report, listing face
\namounts and dates of invoices of each such Eligible Receivable and the name and
\naddress of each account debtor obligated on such Eligible Receivable (and, upon
\nrequest of Agent, copies of invoices, credit reports, and any other matters and
\ninformation relating to the Eligible Receivables).<\/p>\n
“REGULATION D” means Regulation D of the Board of Governors of the
\nFederal Reserve System as from time to time in effect.<\/p>\n
“REQUEST FOR LOAN” means a written or telephonic request, or a written
\nconfirmation, made by Borrower which meets the requirements of Section 2.2.<\/p>\n
“RESTRICTED PERSON” means any of Borrower, Parent, each Guarantor and
\neach Subsidiary of Borrower.<\/p>\n
“RESERVE PERCENTAGE” means, on any day with respect to each particular
\nEurodollar Loan, the maximum reserve requirement, as determined by Agent
\n(including without limitation any basic, supplemental, marginal, emergency or
\nsimilar reserves), expressed as a percentage and rounded to the next higher
\n0.01%, which would then apply under Regulation D with respect to “EUROCURRENCY
\nLIABILITIES”, as such term is defined in Regulation D, of $1,000,000 or more. If
\nsuch reserve requirement shall change after the date hereof, the Reserve
\nPercentage shall be automatically increased or decreased, as the case may be,
\nfrom time to time as of the effective time of each such change in such reserve
\nrequirement.<\/p>\n
“SECURITIES” means both certificated and uncertificated securities as
\nsuch terms are defined in the UCC.<\/p>\n
“SECURITIES ACCOUNT” means Banc One Investment Advisors, Liquidity Asset
\nManagement Account #8334001711 in the name of Debtor established with Securities
\nIntermediary, and any custodial account which replaces such account.<\/p>\n
10
\n 16<\/p>\n
“SECURITIES INTERMEDIARY” means Bank One Trust Company, N.A., a national
\nbanking association.<\/p>\n
“SECURITIES PLEDGE AGREEMENT” means that certain Securities Pledge
\nAgreement dated as of November 23, 1999, executed by Borrower in favor of Agent,
\nas amended, supplemented or restated from time to time.<\/p>\n
“SECURITY DOCUMENTS” means the instruments listed in the Security
\nSchedule and all other security agreements, deeds of trust, mortgages, chattel
\nmortgages, pledges, guaranties, financing statements, continuation statements,
\nextension agreements and other agreements or instruments now, heretofore, or
\nhereafter delivered by any Restricted Person to Agent in connection with this
\nAgreement or any transaction contemplated hereby to secure or guarantee the
\npayment of any part of the Obligations or the performance of any Restricted
\nPerson’s other duties and obligations under the Loan Documents.<\/p>\n
“SECURITY SCHEDULE” means Schedule 2 hereto.<\/p>\n
“SUBSIDIARY” means, with respect to any Person, any corporation,
\nassociation, partnership, joint venture, or other business or corporate entity,
\nenterprise or organization which is directly or indirectly (through one or more
\nintermediaries) controlled by or owned fifty percent or more by such Person.<\/p>\n
“TRIBUNAL” means any government, any arbitration panel, any court or any
\ngovernmental department, commission, board, bureau, agency or instrumentality of
\nthe United States of America or any state, province, commonwealth, nation,
\nterritory, possession, county, parish, town, township, village or municipality,
\nwhether now or hereafter constituted and\/or existing.<\/p>\n
“TYPE” means, with respect to any Loans, the characterization of such
\nLoans as either Base Rate Loans or Eurodollar Loans.<\/p>\n
“UCC” means the Uniform Commercial Code in effect in the State of Texas
\non the date hereof.<\/p>\n
“VOTING STOCK” means, with respect to any Person, securities of any
\nclass or classes of capital stock in such Person normally entitling the holders
\nthereof to vote in the election of members of the Board of Directors or other
\ngoverning body of such Person.<\/p>\n
“YEAR 2000 ISSUES” means anticipated costs, problems and uncertainties
\nassociated with the inability of certain computer applications to effectively
\nhandle data including dates on and after January 1, 2000, as such inability
\naffects the business, operations and financial condition of the Borrower and its
\nSubsidiaries and of the Borrower’s and its Subsidiaries’ material customers,
\nsuppliers and vendors.<\/p>\n
11
\n 17
\n Section 1.1. Exhibits and Schedules; Additional Definitions. All
\nExhibits and Schedules attached to this Agreement are a part hereof for all
\npurposes. Reference is hereby made to the Security Schedule for the meaning of
\ncertain terms defined therein and used but not defined herein, which definitions
\nare incorporated herein by reference.<\/p>\n
Section 1.2. Amendment of Defined Instruments. Unless the context
\notherwise requires or unless otherwise provided herein the terms defined in this
\nAgreement which refer to a particular agreement, instrument or document also
\nrefer to and include all renewals, extensions, modifications, amendments and
\nrestatements of such agreement, instrument or document, provided that nothing
\ncontained in this section shall be construed to authorize any such renewal,
\nextension, modification, amendment or restatement.<\/p>\n
Section 1.3. References and Titles. All references in this Agreement to
\nExhibits, Schedules, articles, sections, subsections and other subdivisions
\nrefer to the Exhibits, Schedules, articles, sections, subsections and other
\nsubdivisions of this Agreement unless expressly provided otherwise. Titles
\nappearing at the beginning of any subdivisions are for convenience only and do
\nnot constitute any part of such subdivisions and shall be disregarded in
\nconstruing the language contained in such subdivisions. The words “THIS
\nAGREEMENT”, “THIS INSTRUMENT”, “HEREIN”, “HEREOF”, “HEREBY”, “HEREUNDER” and
\nwords of similar import refer to this Agreement as a whole and not to any
\nparticular subdivision unless expressly so limited. The phrases “THIS SECTION”
\nand “THIS SUBSECTION” and similar phrases refer only to the sections or
\nsubsections hereof in which such phrases occur. The word “OR” is not exclusive,
\nand the word “INCLUDING” (in its various forms) means “INCLUDING WITHOUT
\nLIMITATION”. Pronouns in masculine, feminine and neuter genders shall be
\nconstrued to include any other gender, and words in the singular form shall be
\nconstrued to include the plural and vice versa, unless the context otherwise
\nrequires.<\/p>\n
Section 1.4. Calculations and Determinations. All calculations under the
\nLoan Documents of interest chargeable with respect to Eurodollar Loans and of
\nfees shall be made on the basis of actual days elapsed (including the first day
\nbut excluding the last) and a year of 360 days. Each determination by a Bank
\nParty of amounts to be paid under Sections 3.2 through 3.6 or any other matters
\nwhich are to be determined hereunder by a Bank Party (such as any Eurodollar
\nRate, LIBOR Rate, Business Day, Interest Period, or Reserve Percentage) shall,
\nin the absence of manifest error, be conclusive and binding. Unless otherwise
\nexpressly provided herein or unless Majority Lenders otherwise consent all
\nfinancial statements and reports furnished to any Bank Party hereunder shall be
\nprepared and all financial computations and determinations pursuant hereto shall
\nbe made in accordance with GAAP.<\/p>\n
ARTICLE II – The Loans<\/p>\n
Section 2.1. Commitments to Lend; Notes. Subject to the terms and
\nconditions hereof, each Lender agrees to make advances to Borrower (herein
\ncalled such Lender’s “LOANS”) upon request from time to time during the
\nCommitment Period so long as (i) each Loan by such Lender does not exceed such
\nLender’s Percentage Share of the aggregate amount of Loans then<\/p>\n
12
\n 18<\/p>\n
requested from all Lenders, and (ii) the aggregate amount of such Lender’s Loans
\noutstanding at any time does not exceed such Lender’s Percentage Share of the
\nBorrowing Base determined as of the date on which the requested Loan is to be
\nmade, and (iii) the aggregate amount of all Loans outstanding at any time does
\nnot exceed the Borrowing Base. The aggregate amount of all Base Rate Loans
\nrequested of all Lenders in any Request for Loan must be greater than or equal
\nto $100,000 or must equal the unadvanced portion of the Borrowing Base and the
\naggregate amount of all Eurodollar Loans requested of all Lenders in any Request
\nfor Loan must be greater than or equal to $1,000,000 (and in multiples of
\n$250,000 if in excess thereof). Borrower may have no more than five Borrowings
\nof Eurodollar Loans outstanding at any time. The obligation of Borrower to repay
\nto each Lender the aggregate amount of all Loans made by such Lender together
\nwith interest accruing in connection therewith, shall be evidenced by a single
\npromissory note (herein called such Lender’s “NOTE”) made by Borrower payable to
\nthe order of such Lender in the form of Exhibit A with appropriate insertions.
\nThe amount of principal owing on any Lender’s Note at any given time shall be
\nthe aggregate amount of all Loans theretofore made by such Lender minus all
\npayments of principal theretofore received by such Lender on such Note. Interest
\non each Note shall accrue and be due and payable as provided herein and therein,
\nwith Eurodollar Loans bearing interest at the Eurodollar Rate and Base Rate
\nLoans bearing interest at the Base Rate (subject to the applicability of the
\nDefault Rate). Subject to the terms and conditions hereof, Borrower may borrow,
\nrepay, and reborrow under the Note during the Commitment Period.<\/p>\n
Section 2.2. Requests for New Loans. Borrower must give to Agent written
\nnotice (or telephonic notice promptly confirmed in writing) of any requested
\nBorrowing of new Loans to be advanced by Lenders. Each such notice constitutes a
\n“REQUEST FOR LOAN” hereunder and must:<\/p>\n
(a) specify (i) the aggregate amount of any such Borrowing of new
\n Base Rate Loans and the date on which such Base Rate Loans are to be
\n advanced, or (ii) the aggregate amount of any such Borrowing of new
\n Eurodollar Loans, the date on which such Eurodollar Loans are to be
\n advanced (which shall be the first day of the Interest Period which is
\n to apply thereto), and the length of the applicable Interest Period; and<\/p>\n
(b) be received by Agent (i) not later than 1:00 p.m., Dallas,
\n Texas time, on the day on which any such Base Rate Loans are to be made,
\n or (ii) on the third Business Day preceding the day on which any such
\n Eurodollar Loans are to be made.<\/p>\n
Each such written request or confirmation must be made in the form and substance
\nof the “REQUEST FOR LOAN” attached hereto as Exhibit B, duly completed. Each
\nsuch telephonic request shall be deemed a representation, warranty,
\nacknowledgment and agreement by Borrower as to the matters which are required to
\nbe set out in such written confirmation. Upon receipt of any such Request for
\nLoan, Agent shall give each Lender prompt notice of the terms thereof. If all
\nconditions precedent to such new Loans have been met, each Lender will on the
\ndate requested promptly remit to Agent at Agent’s office in Dallas, Texas the
\namount of such Lender’s new Loan in immediately available funds, and upon
\nreceipt of such funds, unless to its actual knowledge any conditions precedent
\nto such Loans have been neither met nor waived as provided herein,<\/p>\n
13
\n 19<\/p>\n
Agent shall promptly make such Loans available to Borrower. Unless Agent shall
\nhave received prompt notice from a Lender that such Lender will not make
\navailable to Agent such Lender’s new Loan, Agent may in its discretion assume
\nthat such Lender has made such Loan available to Agent in accordance with this
\nsection and Agent may if it chooses, in reliance upon such assumption, make such
\nLoan available to Borrower. If and to the extent such Lender shall not so make
\nits new Loan available to Agent, such Lender and Borrower severally agree to pay
\nor repay to Agent within three days after demand the amount of such Loan
\ntogether with interest thereon, for each day from the date such amount was made
\navailable to Borrower until the date such amount is paid or repaid to Agent,
\nwith interest at (i) the Federal Funds Rate, if such Lender is making such
\npayment and (ii) the interest rate applicable at the time to the other new Loans
\nmade on such date, if Borrower is making such repayment. If neither such Lender
\nnor Borrower pay or repay to Agent such amount within such three-day period,
\nAgent shall in addition to such amount be entitled to recover from such Lender
\nand from Borrower, on demand, interest thereon at the Default Rate, calculated
\nfrom the date such amount was made available to Borrower. The failure of any
\nLender to make any new Loan to be made by it hereunder shall not relieve any
\nother Lender of its obligation hereunder, if any, to make its new Loan, but no
\nLender shall be responsible for the failure of any other Lender to make any new
\nLoan to be made by such other Lender.<\/p>\n
Section 2.3. Continuations and Conversions of Existing Loans. Borrower
\nmay make the following elections with respect to Loans already outstanding: to
\nconvert Base Rate Loans to Eurodollar Loans, to convert Eurodollar Loans to Base
\nRate Loans on the last day of the Interest Period applicable thereto, and to
\ncontinue Eurodollar Loans beyond the expiration of such Interest Period by
\ndesignating a new Interest Period to take effect at the time of such expiration.
\nIn making such elections, Borrower may combine existing Loans made pursuant to
\nseparate Borrowings into one new Borrowing or divide existing Loans made
\npursuant to one Borrowing into separate new Borrowings. To make any such
\nelection, Borrower must give to Agent written notice (or telephonic notice
\npromptly confirmed in writing) of any such conversion or continuation of
\nexisting Loans, with a separate notice given for each new Borrowing. Each such
\nnotice constitutes a “CONTINUATION\/CONVERSION NOTICE” hereunder and must:<\/p>\n
(a) specify the existing Loans which are to be continued or
\n converted;<\/p>\n
(b) specify (i) the aggregate amount of any Borrowing of Base Rate
\n Loans into which such existing Loans are to be continued or converted
\n and the date on which such continuation or conversion is to occur, or
\n (ii) the aggregate amount of any Borrowing of Eurodollar Loans into
\n which such existing Loans are to be continued or converted, the date on
\n which such continuation or conversion is to occur (which shall be the
\n first day of the Interest Period which is to apply to such Eurodollar
\n Loans), and the length of the applicable Interest Period; and<\/p>\n
(c) be received by Agent not later than 10:00 a.m., Dallas, Texas
\n time, on (i) the day on which any such continuation or conversion to
\n Base Rate Loans is to occur,<\/p>\n
14
\n 20<\/p>\n
or (ii) the third Business Day preceding the day on which any such
\n continuation or conversion to Eurodollar Loans is to occur.<\/p>\n
Each such written request or confirmation must be made in the form and substance
\nof the “CONTINUATION\/CONVERSION NOTICE” attached hereto as Exhibit C, duly
\ncompleted. Each such telephonic request shall be deemed a representation,
\nwarranty, acknowledgment and agreement by Borrower as to the matters which are
\nrequired to be set out in such written confirmation. Upon receipt of any such
\nRequest for Loan, Agent shall give each Lender prompt notice of the terms
\nthereof. Each Request for Loan shall be irrevocable and binding on Borrower.
\nDuring the continuance of any Default, Borrower may not make any election to
\nconvert existing Loans into Eurodollar Loans or continue existing Loans as
\nEurodollar Loans. If (due to the existence of a Default or for any other reason)
\nBorrower fails to timely and properly give any notice of continuation or
\nconversion with respect to a Borrowing of existing Eurodollar Loans at least
\nthree days prior to the end of the Interest Period applicable thereto, such
\nEurodollar Loans shall automatically be converted into Base Rate Loans at the
\nend of such Interest Period. No new funds shall be repaid by Borrower or
\nadvanced by any Lender in connection with any continuation or conversion of
\nexisting Loans pursuant to this section, and no such continuation or conversion
\nshall be deemed to be a new advance of funds for any purpose; such continuations
\nand conversions merely constitute a change in the interest rate applicable to
\nalready outstanding Loans.<\/p>\n
Section 2.4. Use of Proceeds. Borrower shall use all Loans to refinance
\nexisting revolving debt, to provide working capital for its operations and for
\nother general business purposes. In no event shall the funds from any Loan be
\nused directly or indirectly by any Person for personal, family, household or
\nagricultural purposes or for the purpose, whether immediate, incidental or
\nultimate, of purchasing, acquiring or carrying any “margin stock” or any “margin
\nsecurities” (as such terms are defined respectively in Regulation U and
\nRegulation G promulgated by the Board of Governors of the Federal Reserve
\nSystem) or to extend credit to others directly or indirectly for the purpose of
\npurchasing or carrying any such margin stock or margin securities. Borrower
\nrepresents and warrants that Borrower is not engaged principally, or as one of
\nBorrower’s important activities, in the business of extending credit to others
\nfor the purpose of purchasing or carrying such margin stock or margin
\nsecurities.<\/p>\n
Section 2.5. Fees.<\/p>\n
(a) Commitment Fees. (i) In consideration of Bank One’s commitment to
\nmake Loans, Borrower will pay to Agent for the account of Bank One a commitment
\nfee determined on a daily basis by applying a rate of twenty-five basis points
\n(0.25%) per annum to Bank One’s Percentage Share of the unused portion of the
\nCommitment on each day during the Commitment Period, determined for each such
\nday by deducting from the amount of the Commitment at the end of such day the
\nFacility Usage. This commitment fee shall be due and payable in arrears on the
\ntenth day of each Fiscal Quarter for the immediately preceding Fiscal Quarter
\nand at the end of the Commitment Period.<\/p>\n
15
\n 21<\/p>\n
(ii) In consideration of the commitment of each Lender except for
\nBank One, to make Loans, Borrower will pay to Agent for the account of each such
\nLender, a commitment fee determined on a daily basis by applying a rate of
\ntwenty-five basis points (0.25%) per annum to each such Lender’s Percentage
\nShare of the unused portion of the Commitment on each day during the Commitment
\nPeriod, determined for each such day by deducting from the amount of the
\nCommitment at the end of such day the Facility Usage. This commitment fee shall
\nbe due and payable in arrears on the tenth day of each Fiscal Quarter for the
\nimmediately preceding Fiscal Quarter and at the end of the Commitment Period.<\/p>\n
(iii) In consideration of Agent’s obligations hereunder, Borrower
\nwill pay to Agent for its own account a fee determined on a daily basis by
\napplying a rate of twelve and one-half basis points (0.125%) per annum to the
\nunused portion of the Commitment on each day during the Commitment Period,
\ndetermined for each such day by deducting from the amount of the Commitment at
\nthe end of such day the Facility Usage. This fee shall be due and payable in
\narrears on the tenth day of each Fiscal Quarter for the immediately preceding
\nFiscal Quarter and at the end of the Commitment Period.<\/p>\n
(b) Agent’s Fees. In addition to all other amounts due to Agent under
\nthe Loan Documents, Borrower will pay additional fees to Agent as mutually
\nagreed by Agent and Borrower from time to time.<\/p>\n
Section 2.6. Optional Prepayments. Borrower may, upon one Business Days’
\nnotice to each Lender, from time to time (and in the case of Eurodollar Loans,
\nprior to the last day of the Interest Period) and without premium or penalty
\nprepay the Notes, in whole or in part, so long as the aggregate amounts of all
\npartial prepayments of principal on the Notes equals $1,000,000 or any higher
\nintegral multiple of $1,000,000 and so long as any applicable funding losses are
\npaid by Borrower as required by Section 3.5. Any principal or interest prepaid
\npursuant to this section shall be in addition to, and not in lieu of, all
\npayments otherwise required to be paid under the Loan Documents at the time of
\nsuch prepayment.<\/p>\n
Section 2.7. Mandatory Prepayments.<\/p>\n
(a) If at any time the Facility Usage exceeds the Commitment (whether
\ndue to a reduction in the Commitment in accordance with this Agreement, or
\notherwise), Borrower shall immediately upon demand prepay the principal of the
\nLoans in an amount at least equal to such excess.<\/p>\n
(b) If at any time the Facility Usage is less than the Commitment but in
\nexcess of the Borrowing Base (such excess being herein called a “BORROWING BASE
\nDEFICIENCY”), Borrower shall, within one Business Day after Agent gives notice
\nof such fact to Borrower, prepay the principal of the Loans in an aggregate
\namount at least equal to such Borrowing Base Deficiency. If any Lender notifies
\nAgent that a Borrowing Base Deficiency exists, Agent shall promptly notify
\nBorrower thereof.<\/p>\n
16
\n 22<\/p>\n
(c) Each prepayment of principal under this section shall be accompanied
\nby all interest then accrued and unpaid on the principal so prepaid. Any
\nprincipal or interest prepaid pursuant to this section shall be in addition to,
\nand not in lieu of, all payments otherwise required to be paid under the Loan
\nDocuments at the time of such prepayment.<\/p>\n
Section 2.8. Subsequent Determinations of Borrowing Base. Promptly after
\nreceiving each Borrowing Base Report, Agent shall determine the Borrowing Base
\n(provided that all Lenders must agree to any increase in the Borrowing Base),
\nwhich determination shall take effect immediately and remain in effect until the
\nAgent receives the next Borrowing Base Report and determines the next Borrowing
\nBase. In the event Agent has not received an appropriately completed Borrowing
\nBase Report (with all attachments) within the time period specified therein,
\nAgent shall have no obligation to redetermine the Borrowing Base and no Lender
\nshall have any obligation to make any additional Advances until such time as
\nAgent shall have received such information.<\/p>\n
ARTICLE III – Payments to Lenders<\/p>\n
Section 3.1. General Procedures. Borrower will make each payment which
\nit owes under the Loan Documents to Agent for the account of the Bank Party to
\nwhom such payment is owed. Each such payment must be received by Agent not later
\nthan 11:00 a.m., Dallas, Texas time, on the date such payment becomes due and
\npayable, in lawful money of the United States of America, without set-off,
\ndeduction or counterclaim, and in immediately available funds. Any payment
\nreceived by Agent after such time will be deemed to have been made on the next
\nfollowing Business Day. Should any such payment become due and payable on a day
\nother than a Business Day, the maturity of such payment shall be extended to the
\nnext succeeding Business Day, and, in the case of a payment of principal or past
\ndue interest, interest shall accrue and be payable thereon for the period of
\nsuch extension as provided in the Loan Document under which such payment is due.
\nEach payment under a Loan Document shall be due and payable at the place
\nprovided therein and, if no specific place of payment is provided, shall be due
\nand payable at the place of payment of Agent’s Note. When Agent collects or
\nreceives money on account of the Obligations, Agent shall distribute all money
\nso collected or received, and each Bank Party shall apply all such money so
\ndistributed, as follows:<\/p>\n
(a) first, for the payment of all Obligations which are then due
\n under the Loan Documents (and if such money is insufficient to pay all
\n such Obligations, first to any reimbursements due Agent under Section
\n 6.9 or 10.4 and then to the partial payment of all other Obligations
\n then due in proportion to the amounts thereof, or as Bank Parties shall
\n otherwise agree);<\/p>\n
(b) then for the prepayment of amounts owing under the Loan
\n Documents (other than principal on the Notes) if so specified by
\n Borrower;<\/p>\n
(c) then for the prepayment of principal on the Notes, together
\n with accrued and unpaid interest on the principal so prepaid; and<\/p>\n
17
\n 23<\/p>\n
(d) last, for the payment or prepayment of any other obligations
\n secured by the Security Documents.<\/p>\n
All payments applied to principal or interest on any Note shall be applied first
\nto any interest then due and payable, then to principal then due and payable,
\nand last to any prepayment of principal and interest in compliance with Sections
\n2.6 and 2.7. All distributions of amounts described in any of subsections (b),
\n(c) or (d) above shall be made by Agent pro rata to each Bank Party then owed
\nObligations described in such subsection in proportion to all amounts owed to
\nall Bank Parties which are described in such subsection.<\/p>\n
Section 3.2. Capital Reimbursement. If either (a) the introduction or
\nimplementation of or the compliance with or any change in or in the
\ninterpretation of any Law, or (b) the introduction or implementation of or the
\ncompliance with any request, directive or guideline from any central bank or
\nother governmental authority (whether or not having the force of Law) affects or
\nwould affect the amount of capital required or expected to be maintained by any
\nBank Party or any corporation controlling any Bank Party, then, upon demand by
\nsuch Bank Party, Borrower will pay to Agent for the benefit of such Bank Party,
\nfrom time to time as specified by such Bank Party, such additional amount or
\namounts which such Bank Party shall determine to be appropriate to compensate
\nsuch Bank Party or any corporation controlling such Bank Party in light of such
\ncircumstances, to the extent that such Bank Party reasonably determines that the
\namount of any such capital would be increased or the rate of return on any such
\ncapital would be reduced by or in whole or in part based on the existence of the
\nface amount of such Bank Party’s Loans, or participations in commitments under
\nthis Agreement.<\/p>\n
Section 3.3. Increased Cost of Eurodollar Loans. If any applicable Law
\n(whether now in effect or hereinafter enacted or promulgated, including
\nRegulation D) or any interpretation or administration thereof by any
\ngovernmental authority charged with the interpretation or administration thereof
\n(whether or not having the force of Law):<\/p>\n
(a) shall change the basis of taxation of payments to any Bank
\n Party of any principal, interest, or other amounts attributable to any
\n Eurodollar Loan or otherwise due under this Agreement in respect of any
\n Eurodollar Loan (other than taxes imposed on the overall net income of
\n such Bank Party or any lending office of such Bank Party by any
\n jurisdiction in which such Bank Party or any such lending office is
\n located); or<\/p>\n
(b) shall change, impose, modify, apply or deem applicable any
\n reserve, special deposit or similar requirements in respect of any
\n Eurodollar Loan (excluding those for which such Bank Party is fully
\n compensated pursuant to adjustments made in the definition of Eurodollar
\n Rate) or against assets of, deposits with or for the account of, or
\n credit extended by, such Bank Party; or<\/p>\n
(c) shall impose on any Bank Party or the interbank eurocurrency
\n deposit market any other condition affecting any Eurodollar Loan, the
\n result of which is to increase the cost to any Bank Party of funding or
\n maintaining any Eurodollar Loan or to<\/p>\n
18
\n 24<\/p>\n
reduce the amount of any sum receivable by any Bank Party in respect of
\n any Eurodollar Loan by an amount deemed by such Bank Party to be
\n material,<\/p>\n
then such Bank Party shall promptly notify Agent and Borrower in writing of the
\nhappening of such event and of the amount required to compensate such Bank Party
\nfor such event (on an after-tax basis, taking into account any taxes on such
\ncompensation), whereupon (i) Borrower shall pay such amount to Agent for the
\naccount of such Bank Party and (ii) Borrower may elect, by giving to Agent and
\nsuch Bank Party not less than three Business Days’ notice, to convert all (but
\nnot less than all) of any such Eurodollar Loans into Base Rate Loans.<\/p>\n
Section 3.4. Availability. If (a) any change in applicable Laws, or in
\nthe interpretation or administration thereof of or in any jurisdiction
\nwhatsoever, domestic or foreign, shall make it unlawful or impracticable for any
\nBank Party to fund or maintain Eurodollar Loans, or shall materially restrict
\nthe authority of any Bank Party to purchase or take offshore deposits of dollars
\n(i.e., “eurodollars”), or (b) any Bank Party determines that matching deposits
\nappropriate to fund or maintain any Eurodollar Loan are not available to it, or
\n(c) any Bank Party determines that the formula for calculating the Adjusted
\nEurodollar Rate does not fairly reflect the cost to such Bank Party of making or
\nmaintaining loans based on such rate, then, upon notice by such Bank Party to
\nBorrower and Agent, Borrower’s right to elect Eurodollar Loans from such Bank
\nParty shall be suspended to the extent and for the duration of such illegality,
\nimpracticability or restriction and all Eurodollar Loans of such Bank Party
\nwhich are then outstanding or are then the subject of any Request for Loan and
\nwhich cannot lawfully or practicably be maintained or funded shall immediately
\nbecome or remain, or shall be funded as, Base Rate Loans of such Bank Party.
\nBorrower agrees to reimburse each Bank Party for all costs, expenses, claims,
\npenalties, liabilities and damages which may result from any such change in Law,
\ninterpretation or administration. Such reimbursement shall be on an after-tax
\nbasis, taking into account any taxes imposed on the amounts reimbursed.<\/p>\n
Section 3.5. Funding Losses. In addition to its other obligations
\nhereunder, Borrower will reimburse each Bank Party on demand for, any loss or
\nexpense incurred or sustained by such Bank Party (including any loss or expense
\nincurred by reason of the liquidation or reemployment of deposits or other funds
\nacquired by a Bank Party to fund or maintain Eurodollar Loans), as a result of
\n(a) any payment or prepayment (whether authorized or required hereunder or
\notherwise) of all or a portion of a Eurodollar Loan on a day other than the day
\non which the applicable Interest Period ends, (b) any payment or prepayment,
\nwhether required hereunder or otherwise, of a Loan made after the delivery, but
\nbefore the effective date, of a Continuation\/Conversion Notice, if such payment
\nor prepayment prevents such Continuation\/Conversion Notice from becoming fully
\neffective, (c) the failure of any Loan to be made or of any
\nContinuation\/Conversion Notice to become effective due to any condition
\nprecedent not being satisfied or due to any other action or inaction of any
\nRestricted Person, or (d) any conversion (whether authorized or required
\nhereunder or otherwise) of all or any portion of any Eurodollar Loan into a Base
\nRate Loan or into a different Eurodollar Loan on a day other than the day on
\nwhich the applicable Interest Period ends. Such reimbursement shall be on an
\nafter-tax basis, taking into account any taxes imposed on the amounts
\nreimbursed.<\/p>\n
19
\n 25<\/p>\n
Section 3.6. Reimbursable Taxes. Borrower covenants and agrees that:<\/p>\n
(a) Borrower will reimburse each Bank Party for all present and
\n future income, stamp and other taxes, levies, costs and charges
\n whatsoever imposed, assessed, levied or collected on or in respect of
\n this Agreement or any Eurodollar Loans (whether or not legally or
\n correctly imposed, assessed, levied or collected), excluding, however,
\n any taxes imposed on or measured by the overall net income of Agent or
\n such Bank Party or any lending office of such Bank Party by any
\n jurisdiction in which such Bank Party or any such lending office is
\n located (all such non-excluded taxes, levies, costs and charges being
\n collectively called “REIMBURSABLE TAXES” in this section). Such
\n reimbursement shall be on an after-tax basis, taking into account any
\n taxes imposed on the amounts reimbursed.<\/p>\n
(b) All payments on account of the principal of, and interest on,
\n each Bank Party’s Loans and Note, and all other amounts payable by
\n Borrower to any Bank Party hereunder, shall be made in full without
\n set-off or counterclaim and shall be made free and clear of and without
\n deductions or withholdings of any nature by reason of any Reimbursable
\n Taxes, all of which will be for the account of Borrower. In the event of
\n Borrower being compelled by Law to make any such deduction or
\n withholding from any payment to any Bank Party, Borrower shall pay on
\n the due date of such payment, by way of additional interest, such
\n additional amounts as are needed to cause the amount receivable by such
\n Bank Party after such deduction or withholding to equal the amount which
\n would have been receivable in the absence of such deduction or
\n withholding. If Borrower should make any deduction or withholding as
\n aforesaid, Borrower shall within 60 days thereafter forward to such Bank
\n Party an official receipt or other official document evidencing payment
\n of such deduction or withholding.<\/p>\n
(c) If Borrower is ever required to pay any Reimbursable Tax with
\n respect to any Eurodollar Loan, Borrower may elect, by giving to Agent
\n and such Bank Party not less than three Business Days’ notice, to
\n convert all (but not less than all) of any such Eurodollar Loan into a
\n Base Rate Loan, but such election shall not diminish Borrower’s
\n obligation to pay all Reimbursable Taxes.<\/p>\n
(d) Notwithstanding the foregoing provisions of this section,
\n Borrower shall be entitled, to the extent it is required to do so by
\n Law, to deduct or withhold (and not to make any reimbursement for)
\n income or other similar taxes imposed by the United States of America
\n (other than any portion thereof attributable to a change in federal
\n income tax Laws effected after the date hereof) from interest, fees or
\n other amounts payable hereunder for the account of any Bank Party, other
\n than a Bank Party (i) who is a U.S. person for Federal income tax
\n purposes or (ii) who has the Prescribed Forms on file with Agent (with
\n copies provided to Borrower) for the applicable year to the extent
\n deduction or withholding of such taxes<\/p>\n
20
\n 26<\/p>\n
is not required as a result of the filing of such Prescribed Forms,
\n provided that if Borrower shall so deduct or withhold any such taxes, it
\n shall provide a statement to Agent and such Bank Party, setting forth
\n the amount of such taxes so deducted or withheld, the applicable rate
\n and any other information or documentation which such Bank Party may
\n reasonably request for assisting such Bank Party to obtain any allowable
\n credits or deductions for the taxes so deducted or withheld in the
\n jurisdiction or jurisdictions in which such Bank Party is subject to
\n tax. As used in this section, “Prescribed Forms” means such duly
\n executed forms or statements, and in such number of copies, which may,
\n from time to time, be prescribed by Law and which, pursuant to
\n applicable provisions of (x) an income tax treaty between the United
\n States and the country of residence of the Bank Party providing the
\n forms or statements, (y) the Internal Revenue Code of 1986, as amended
\n from time to time, or (z) any applicable rules or regulations
\n thereunder, permit Borrower to make payments hereunder for the account
\n of such Bank Party free of such deduction or withholding of income or
\n similar taxes.<\/p>\n
Section 3.7. [RESERVED].<\/p>\n
Section 3.8. Replacement of Lenders. If any Bank Party seeks
\nreimbursement for increased costs under Sections 3.2 through 3.6, then within
\nninety days thereafter — provided no Event of Default then exists — Borrower
\nshall have the right (unless such Bank Party withdraws its request for
\nadditional compensation) to replace such Bank Party by requiring such Bank Party
\nto assign its Loans and Notes and its commitments hereunder to an Eligible
\nTransferee reasonably acceptable to Agent and to Borrower, provided that: (i)
\nall Obligations of Borrower owing to such Bank Party being replaced (including
\nsuch increased costs, but excluding principal and accrued interest on the Notes
\nbeing assigned) shall be paid in full to such Bank Party concurrently with such
\nassignment, (ii) the replacement Eligible Transferee shall purchase the Note
\nbeing assigned by paying to such Bank Party a price equal to the principal
\namount thereof plus accrued and unpaid interest thereon, and (iii) any
\napplicable funding losses are paid by Borrower as required by Section 3.5 a
\nresult of such replacement. In connection with any such assignment Borrower,
\nAgent, such Bank Party and the replacement Eligible Transferee shall otherwise
\ncomply with Section 10.5. Notwithstanding the foregoing rights of Borrower under
\nthis section, however, Borrower may not replace any Bank Party which seeks
\nreimbursement for increased costs under Section 3.2 through 3.6 unless Borrower
\nis at the same time replacing all Bank Parties which are then seeking such
\ncompensation.<\/p>\n
ARTICLE IV – Conditions Precedent to Lending<\/p>\n
Section 4.1. Documents to be Delivered. No Lender has any obligation to
\nmake its first Loan, unless Agent shall have received all of the following, at
\nAgent’s office in Dallas, Texas, duly executed and delivered and in form,
\nsubstance and date satisfactory to Agent:<\/p>\n
(a) This Agreement and any other documents that Lenders are to
\n execute in connection herewith.<\/p>\n
(b) Each Note.<\/p>\n
21
\n 27<\/p>\n
(c) Each Security Document listed in the Security Schedule.<\/p>\n
(d) Certain certificates of Borrower including:<\/p>\n
(i) An “Omnibus Certificate” of the Secretary and of the
\n Chairman of the Board or President of Borrower, which shall contain
\n the names and signatures of the officers of Borrower authorized to
\n execute Loan Documents and which shall certify to the truth,
\n correctness and completeness of the following exhibits attached
\n thereto: (1) a copy of resolutions duly adopted by the Board of
\n Directors of Borrower and in full force and effect at the time this
\n Agreement is entered into, authorizing the execution of this
\n Agreement and the other Loan Documents delivered or to be delivered
\n in connection herewith and the consummation of the transactions
\n contemplated herein and therein, (2) a copy of the charter
\n documents of Borrower and all amendments thereto, certified by the
\n appropriate official of Borrower’s state of organization, and (3) a
\n copy of any bylaws of Borrower; and<\/p>\n
(ii) A “Compliance Certificate” of the Chairman of the Board
\n or President and of the chief financial officer of Borrower, of
\n even date with such Loan, in which such officers certify to the
\n satisfaction of the conditions set out in subsections (a), (b), (c)
\n and (d) of Section 4.2.<\/p>\n
(e) A certificate (or certificates) of the due formation, valid
\n existence and good standing of Borrower in its state of organization,
\n issued by the appropriate authorities of such jurisdiction, and
\n certificates of Borrower’s good standing and due qualification to do
\n business, issued by appropriate officials in any states in which
\n Borrower owns property subject to Security Documents.<\/p>\n
(f) Documents similar to those specified in subsections (d)(i) and
\n (e) of this section with respect to each Guarantor and the execution by
\n it of its guaranty of Borrower’s Obligations.<\/p>\n
(g) A favorable opinion of Locke Liddell Sapp, counsel for
\n Restricted Persons, substantially in the form set forth in Exhibit F.<\/p>\n
(h) The Initial Financial Statements.<\/p>\n
(i) Certificates or binders evidencing Restricted Persons’
\n insurance in effect on the date hereof.<\/p>\n
Section 4.2. Additional Conditions Precedent. No Lender has any
\nobligation to make any Loan (including its first), unless the following
\nconditions precedent have been satisfied:<\/p>\n
(a) All representations and warranties made by any Restricted
\n Person in any Loan Document shall be true on and as of the date of such
\n Loan (except to the extent that<\/p>\n
22
\n 28<\/p>\n
the facts upon which such representations are based have been changed by
\n the extension of credit hereunder) as if such representations and
\n warranties had been made as of the date of such Loan.<\/p>\n
(b) No Default shall exist at the date of such Loan.<\/p>\n
(c) No Material Adverse Change shall have occurred to, and no event
\n or circumstance shall have occurred that could cause a Material Adverse
\n Change to, Borrower’s Consolidated financial condition or businesses
\n since the date of this Agreement.<\/p>\n
(d) Each Restricted Person shall have performed and complied with
\n all agreements and conditions required in the Loan Documents to be
\n performed or complied with by it on or prior to the date of such Loan.<\/p>\n
(e) The making of such Loan shall not be prohibited by any Law and
\n shall not subject any Lender to any penalty or other onerous condition
\n under or pursuant to any such Law.<\/p>\n
(f) Agent shall have received all documents and instruments which
\n Agent has then requested, in addition to those described in Section 4.1
\n (including opinions of legal counsel for Restricted Persons and Agent;
\n corporate documents and records; documents evidencing governmental
\n authorizations, consents, approvals, licenses and exemptions; and
\n certificates of public officials and of officers and representatives of
\n Borrower and other Persons), as to (i) the accuracy and validity of or
\n compliance with all representations, warranties and covenants made by
\n any Restricted Person in this Agreement and the other Loan Documents,
\n (ii) the satisfaction of all conditions contained herein or therein, and
\n (iii) all other matters pertaining hereto and thereto. All such
\n additional documents and instruments shall be satisfactory to Agent in
\n form, substance and date.<\/p>\n
(g) Payment of all commitment, facility, agency and other fees
\n required to be paid to any Bank Party pursuant to any Loan Documents or
\n any commitment agreement heretofore entered into.<\/p>\n
ARTICLE V – Representations and Warranties<\/p>\n
To confirm each Bank Party’s understanding concerning Restricted Persons
\nand Restricted Persons’ businesses, properties and obligations and to induce
\neach Bank Party to enter into this Agreement and to extend credit hereunder,
\nBorrower represents and warrants to each Bank Party that:<\/p>\n
23
\n 29<\/p>\n
Section 5.1. No Default. No Restricted Person is in default in the
\nperformance of any of the covenants and agreements contained in any Loan
\nDocument. To the best of Borrower’s knowledge, no event has occurred and is
\ncontinuing which constitutes a Default.<\/p>\n
Section 5.2. Organization and Good Standing. Each Restricted Person is
\nduly organized, validly existing and in good standing under the Laws of its
\njurisdiction of organization, having all powers required to carry on its
\nbusiness and enter into and carry out the transactions contemplated hereby. Each
\nRestricted Person is duly qualified, in good standing, and authorized to do
\nbusiness in all other jurisdictions within the United States wherein the
\ncharacter of the properties owned or held by it or the nature of the business
\ntransacted by it makes such qualification necessary. Each Restricted Person has
\ntaken all actions and procedures customarily taken in order to enter, for the
\npurpose of conducting business or owning property, each jurisdiction outside the
\nUnited States wherein the character of the properties owned or held by it or the
\nnature of the business transacted by it makes such actions and procedures
\ndesirable.<\/p>\n
Section 5.3. Authorization. Each Restricted Person has duly taken all
\naction necessary to authorize the execution and delivery by it of the Loan
\nDocuments to which it is a party and to authorize the consummation of the
\ntransactions contemplated thereby and the performance of its obligations
\nthereunder. Borrower is duly authorized to borrow funds hereunder.<\/p>\n
Section 5.4. No Conflicts or Consents. The execution and delivery by the
\nvarious Restricted Persons of the Loan Documents to which each is a party, the
\nperformance by each of its obligations under such Loan Documents, and the
\nconsummation of the transactions contemplated by the various Loan Documents, do
\nnot and will not (i) conflict with any provision of (1) any Law, (2) the
\norganizational documents of any Restricted Person, or (3) any agreement,
\njudgment, license, order or permit applicable to or binding upon any Restricted
\nPerson, (ii) result in the acceleration of any Indebtedness owed by any
\nRestricted Person, or (iii) result in or require the creation of any Lien upon
\nany assets or properties of any Restricted Person except as expressly
\ncontemplated in the Loan Documents. Except as expressly contemplated in the Loan
\nDocuments no consent, approval, authorization or order of, and no notice to or
\nfiling with, any Tribunal or third party is required in connection with the
\nexecution, delivery or performance by any Restricted Person of any Loan Document
\nor to consummate any transactions contemplated by the Loan Documents.<\/p>\n
Section 5.5. Enforceable Obligations. This Agreement is, and the other
\nLoan Documents when duly executed and delivered will be, legal, valid and
\nbinding obligations of each Restricted Person which is a party hereto or
\nthereto, enforceable in accordance with their terms except as such enforcement
\nmay be limited by bankruptcy, insolvency or similar Laws of general application
\nrelating to the enforcement of creditors’ rights.<\/p>\n
Section 5.6. Initial Financial Statements. Borrower has heretofore
\ndelivered to each Bank Party true, correct and complete copies of the Initial
\nFinancial Statements. The Initial Financial Statements fairly present Borrower’s
\nConsolidated financial position at the respective dates thereof and the
\nConsolidated results of Borrower’s operations and Borrower’s Consolidated<\/p>\n
24
\n 30<\/p>\n
cash flows for the respective periods thereof. Since the date of the annual
\nInitial Financial Statements no Material Adverse Change has occurred. All
\nInitial Financial Statements were prepared in accordance with GAAP.<\/p>\n
Section 5.7. Other Obligations and Restrictions. No Restricted Person
\nhas any outstanding Liabilities of any kind (including contingent obligations,
\ntax assessments, and unusual forward or long-term commitments) which is, in the
\naggregate, material to Borrower or material with respect to Borrower’s
\nConsolidated financial condition and not shown in the Initial Financial
\nStatements or disclosed in the Disclosure Schedule or a Disclosure Report.
\nExcept as shown in the Initial Financial Statements or disclosed in the
\nDisclosure Schedule or a Disclosure Report, no Restricted Person is subject to
\nor restricted by any franchise, contract, deed, charter restriction, or other
\ninstrument or restriction which could cause a Material Adverse Change.<\/p>\n
Section 5.8. Full Disclosure. No certificate, statement or other
\ninformation delivered herewith or heretofore by any Restricted Person to any
\nBank Party in connection with the negotiation of this Agreement or in connection
\nwith any transaction contemplated hereby contains any untrue statement of a
\nmaterial fact or omits to state any material fact known to any Restricted Person
\n(other than industry-wide risks normally associated with the types of businesses
\nconducted by Restricted Persons) necessary to make the statements contained
\nherein or therein not misleading as of the date made or deemed made. There is no
\nfact known to any Restricted Person that has not been disclosed to each Bank
\nParty in writing which could cause a Material Adverse Change.<\/p>\n
Section 5.9. Litigation. Except as disclosed in the Initial Financial
\nStatements or in the Disclosure Schedule: (i) there are no actions, suits or
\nlegal, equitable, arbitrative or administrative proceedings pending, or to the
\nknowledge of any Restricted Person threatened, against any Restricted Person
\nbefore any Tribunal which could cause a Material Adverse Change, and (ii) there
\nare no outstanding judgments, injunctions, writs, rulings or orders by any such
\nTribunal against any Restricted Person or any Restricted Person’s stockholders,
\npartners, directors or officers which could cause a Material Adverse Change.<\/p>\n
Section 5.10. Labor Disputes and Acts of God. Except as disclosed in the
\nDisclosure Schedule or a Disclosure Report, neither the business nor the
\nproperties of any Restricted Person has been affected by any fire, explosion,
\naccident, strike, lockout or other labor dispute, drought, storm, hail,
\nearthquake, embargo, act of God or of the public enemy or other casualty
\n(whether or not covered by insurance), which could cause a Material Adverse
\nChange.<\/p>\n
Section 5.11. ERISA Plans and Liabilities. All currently existing ERISA
\nPlans are listed in the Disclosure Schedule or a Disclosure Report. All
\nRestricted Persons are in compliance with ERISA in all material respects. No
\nRestricted Person is required to contribute to, or has any other absolute or
\ncontingent liability in respect of, any “multiemployer plan” as defined in
\nSection 4001 of ERISA. Except as set forth in the Disclosure Schedule or a
\nDisclosure Report: (i) no “accumulated funding deficiency” (as defined in
\nSection 412(a) of the Internal Revenue Code of 1986, as amended) exists with
\nrespect to any ERISA Plan, whether or not waived by the<\/p>\n
25
\n 31<\/p>\n
Secretary of the Treasury or his delegate, and (ii) the current value of each
\nERISA Plan’s benefits does not exceed the current value of such ERISA Plan’s
\nassets available for the payment of such benefits by more than $500,000.<\/p>\n
Section 5.12. Environmental and Other Laws. Except as disclosed in the
\nDisclosure Schedule or a Disclosure Report: (a) Restricted Persons are
\nconducting their businesses in material compliance with all applicable Laws,
\nincluding Environmental Laws, and have and are in compliance with all licenses
\nand permits required under any such Laws; (b) none of the operations or
\nproperties of any Restricted Person is the subject of federal, state or local
\ninvestigation evaluating whether any material remedial action is needed to
\nrespond to a release of any Hazardous Materials into the environment or to the
\nimproper storage or disposal (including storage or disposal at offsite
\nlocations) of any Hazardous Materials; (c) no Restricted Person (and to the best
\nknowledge of Borrower, no other Person) has filed any notice under any Law
\nindicating that any Restricted Person is responsible for the improper release
\ninto the environment, or the improper storage or disposal, of any material
\namount of any Hazardous Materials or that any Hazardous Materials have been
\nimproperly released, or are improperly stored or disposed of, upon any property
\nof any Restricted Person; (d) no Restricted Person has transported or arranged
\nfor the transportation of any Hazardous Material to any location which is (i)
\nlisted on the National Priorities List under the Comprehensive Environmental
\nResponse, Compensation and Liability Act of 1980, as amended, listed for
\npossible inclusion on such National Priorities List by the Environmental
\nProtection Agency in its Comprehensive Environmental Response, Compensation and
\nLiability Information System List, or listed on any similar state list or (ii)
\nthe subject of federal, state or local enforcement actions or other
\ninvestigations which may lead to claims against any Restricted Person for
\nclean-up costs, remedial work, damages to natural resources or for personal
\ninjury claims (whether under Environmental Laws or otherwise); and (e) no
\nRestricted Person otherwise has any known material contingent liability under
\nany Environmental Laws or in connection with the release into the environment,
\nor the storage or disposal, of any Hazardous Materials.<\/p>\n
Section 5.13. Names and Places of Business. No Restricted Person has,
\nduring the preceding five years, had, been known by, or used any other trade or
\nfictitious name, except as disclosed in the Disclosure Schedule. Except as
\notherwise indicated in the Disclosure Schedule or a Disclosure Report, the chief
\nexecutive office and principal place of business of each Restricted Person are
\n(and for the preceding five years have been) located at the address of Borrower
\nset out in Section 10.3. Except as indicated in the Disclosure Schedule or a
\nDisclosure Report, no Restricted Person has any other office or place of
\nbusiness.<\/p>\n
Section 5.14. Borrower’s Subsidiaries. Borrower does not presently have
\nany Subsidiary or own any stock in any other corporation or association except
\nthose listed in the Disclosure Schedule or a Disclosure Report. Neither Borrower
\nnor any Restricted Person is a member of any general or limited partnership,
\njoint venture or association of any type whatsoever except those listed in the
\nDisclosure Schedule or a Disclosure Report. Except as otherwise revealed in a
\nDisclosure Report, Borrower owns, directly or indirectly, the equity interest in
\neach of its Subsidiaries which is indicated in the Disclosure Schedule.<\/p>\n
26
\n 32<\/p>\n
Section 5.15. Title to Properties; Licenses. Each Restricted Person has
\ngood and to the best of Borrower’s knowledge, defensible title to all of its
\nmaterial properties and assets, free and clear of all Liens other than Permitted
\nLiens and of all impediments to the use of such properties and assets in such
\nRestricted Person’s business. Each Restricted Person possesses all licenses,
\npermits, franchises, patents, copyrights, trademarks and trade names, and other
\nintellectual property (or otherwise possesses the right to use such intellectual
\nproperty without violation of the rights of any other Person) which are
\nnecessary to carry out its business as presently conducted and as presently
\nproposed to be conducted hereafter, and no Restricted Person is in violation in
\nany material respect of the terms under which it possesses such intellectual
\nproperty or the right to use such intellectual property.<\/p>\n
Section 5.16. Government Regulation. Neither Borrower nor any other
\nRestricted Person owing Obligations is subject to regulation under the Public
\nUtility Holding Company Act of 1935, the Federal Power Act, the Investment
\nCompany Act of 1940 (as any of the preceding acts have been amended) or any
\nother Law which regulates the incurring by such Person of Indebtedness,
\nincluding Laws relating to common contract carriers or the sale of electricity,
\ngas, steam, water or other public utility services.<\/p>\n
Section 5.17. Insider. To the best of Borrower’s knowledge, no
\nRestricted Person, nor any Person having “control” (as that term is defined in
\n12 U.S.C. Section 375b(9) or in regulations promulgated pursuant thereto) of any
\nRestricted Person, is a “director” or an “executive officer” or “principal
\nshareholder” (as those terms are defined in 12 U.S.C. Section 375b(8) or (9) or
\nin regulations promulgated pursuant thereto) of any Bank Party, of a bank
\nholding company of which any Bank Party is a Subsidiary or of any Subsidiary of
\na bank holding company of which any Bank Party is a Subsidiary.<\/p>\n
Section 5.18. Year 2000. Borrower has made a full and complete
\nassessment of the Year 2000 Issues and has a realistic and achievable program
\nfor remediating the Year 2000 Issues on a timely basis (the “Year 2000
\nProgram”). Based on such assessment and on the Year 2000 Program Borrower does
\nnot reasonably anticipate that Year 2000 Issues will result in a Material
\nAdverse Change.<\/p>\n
ARTICLE VI – Affirmative Covenants of Borrower<\/p>\n
To conform with the terms and conditions under which each Bank Party is
\nwilling to have credit outstanding to Borrower, and to induce each Bank Party to
\nenter into this Agreement and extend credit hereunder, Borrower warrants,
\ncovenants and agrees that until the full and final payment of the Obligations
\nand the termination of this Agreement, unless Majority Lenders have previously
\nagreed otherwise:<\/p>\n
Section 6.1. Payment and Performance. Borrower will pay all amounts due
\nunder the Loan Documents in accordance with the terms thereof and will observe,
\nperform and comply with every covenant, term and condition expressed or implied
\nin the Loan Documents. Borrower<\/p>\n
27
\n 33<\/p>\n
will cause each other Restricted Person to observe, perform and comply with
\nevery such term, covenant and condition.<\/p>\n
Section 6.2. Books, Financial Statements and Reports. Each Restricted
\nPerson will at all times maintain full and accurate books of account and
\nrecords. Borrower will maintain and will cause its Subsidiaries to maintain a
\nstandard system of accounting, will maintain its Fiscal Year, and will furnish
\nthe following statements and reports to each Bank Party at Borrower’s expense:<\/p>\n
(a) As soon as available, and in any event within 120 days after
\n the end of each Fiscal Year, complete Consolidated financial statements
\n of Borrower together with all notes thereto, prepared in reasonable
\n detail in accordance with GAAP, together with an unqualified opinion,
\n based on an audit using generally accepted auditing standards, by Price
\n Waterhouse, LLP or other independent certified public accountants
\n selected by Borrower and reasonably acceptable to Agent, stating that
\n such Consolidated financial statements have been so prepared. These
\n financial statements shall contain a Consolidated balance sheet as of
\n the end of such Fiscal Year and Consolidated statements of earnings, of
\n cash flows, and of changes in owners’ equity for such Fiscal Year, each
\n setting forth in comparative form the corresponding figures for the
\n preceding Fiscal Year.<\/p>\n
(b) Upon the reasonable request of Agent, complete consolidating
\n financial statements of Borrower, prepared by Borrower, together with
\n all notes thereto, prepared in reasonable detail in accordance with
\n GAAP. These financial statements shall contain a consolidating balance
\n sheet as of the end of such Fiscal Year and consolidating statements of
\n earnings for such Fiscal Year, each setting forth in comparative form
\n the corresponding figures for the preceding Fiscal Year.<\/p>\n
(c) As soon as available, and in any event within forty-five (45)
\n days after the end of each Fiscal Quarter Borrower’s Consolidated
\n balance sheet as of the end of such Fiscal Quarter and Consolidated
\n statements of Borrower’s earnings and cash flows for the period from the
\n beginning of the then current Fiscal Year to the end of such Fiscal
\n Quarter, all in reasonable detail and prepared in accordance with GAAP,
\n subject to changes resulting from normal year-end adjustments. In
\n addition Borrower will, together with each such set of financial
\n statements, furnish a certificate in the form of Exhibit D signed by the
\n chief financial officer of Borrower stating that such financial
\n statements are accurate and complete, stating that he has reviewed the
\n Loan Documents, containing calculations showing compliance (or
\n non-compliance) at the end of such Fiscal Quarter with the requirements
\n of Sections 7.11, 7.12, 7.13, and 7.14, and stating that no Default
\n exists at the end of such Fiscal Quarter or at the time of such
\n certificate or specifying the nature and period of existence of any such
\n Default.<\/p>\n
(d) Promptly upon their becoming available, copies of all financial
\n statements, reports, notices and proxy statements sent by any Restricted
\n Person to its stockholders and all registration statements, periodic
\n reports and other statements and schedules filed<\/p>\n
28
\n 34<\/p>\n
by any Restricted Person with any securities exchange, the Securities
\n and Exchange Commission or any similar governmental authority.<\/p>\n
(e) Concurrently with any Request for Loan, and in any event at
\n least monthly, a Borrowing Base Report, appropriately completed and with
\n all attachments.<\/p>\n
(f) As soon as available, and in any event within ninety (90) days
\n after the end of each Fiscal Year, financial projections for Borrower
\n (in form reasonably satisfactory to Agent), prepared by a senior
\n financial officer thereof, setting forth the financial projections for
\n the next Fiscal Year, including but not limited to, a projected balance
\n sheet and statements of projected earnings and cash flows for Borrower
\n for such Fiscal Year, and stating that such projections were based on
\n good faith estimates and assumptions at that time contained in such
\n projection believed by Borrower to be reasonable and such projections
\n have at that time been prepared in accordance with such assumptions.
\n Upon reasonable request, Borrower shall provide updated financial
\n projections, if available.<\/p>\n
(g) Upon the request of Agent, but in no event more frequently than
\n one time per month a Receivables Report, appropriately completed and
\n with all attachments.<\/p>\n
Section 6.3. Other Information and Inspections. Each Restricted Person
\nwill furnish to each Bank Party any information which Agent may from time to
\ntime reasonably request in writing concerning the Marketable Securities
\nCollateral (such as face amounts and dates of invoices and the name and address
\nof each account debtor obligated on such Eligible Receivable) and any covenant,
\nprovision or condition of the Loan Documents or any matter in connection with
\nRestricted Persons’ businesses and operations. Each Restricted Person will
\npermit representatives appointed by Agent (including independent accountants,
\nauditors, agents, attorneys, appraisers, representatives of any Lender and any
\nother Persons) to visit and inspect during normal business hours any of such
\nRestricted Person’s property, including its books of account, other books and
\nrecords, and any facilities or other business assets, and to make extra copies
\ntherefrom and photocopies and photographs thereof, and to write down and record
\nany information such representatives obtain, and each Restricted Person shall
\npermit Agent or its representatives to investigate and verify the accuracy of
\nthe information furnished to Agent or any Lender in connection with the Loan
\nDocuments and to discuss all such matters with its officers, employees and
\nrepresentatives.<\/p>\n
Section 6.4. Notice of Material Events and Change of Address. Borrower
\nwill promptly notify each Bank Party in writing, stating that such notice is
\nbeing given pursuant to this Agreement, of:<\/p>\n
(a) the occurrence of any Material Adverse Change,<\/p>\n
(b) the occurrence of any Default,<\/p>\n
29
\n 35<\/p>\n
(c) the acceleration of the maturity of any Indebtedness owed by
\n any Restricted Person or of any default by any Restricted Person under
\n any indenture, mortgage, agreement, contract or other instrument to
\n which any of them is a party or by which any of them or any of their
\n properties is bound, if such acceleration or default could cause a
\n Material Adverse Change,<\/p>\n
(d) any claim of $100,000 or more, any notice of potential
\n liability under any Environmental Laws which might exceed such amount,
\n or any other material adverse claim asserted against any Restricted
\n Person or with respect to any Restricted Person’s properties,<\/p>\n
(e) the filing of any suit or proceeding against any Restricted
\n Person in which an adverse decision could cause a Material Adverse
\n Change, and<\/p>\n
(f) a reduction in Borrower’s Minimum Eligible Receivables below
\n $40,000,000 at any time.<\/p>\n
Upon the occurrence of any of the foregoing Restricted Persons will take all
\nnecessary or appropriate steps to remedy promptly any such Material Adverse
\nChange, Default, acceleration, or default, to protect against any such adverse
\nclaim, to defend any such suit or proceeding, and to resolve all controversies
\non account of any of the foregoing. Borrower will also notify Agent and Agent’s
\ncounsel in writing at least twenty Business Days prior to the date that any
\nRestricted Person changes its name or the location of its chief executive office
\nor principal place of business or the place where it keeps its books and records
\nconcerning the Collateral, furnishing with such notice any necessary financing
\nstatement amendments or requesting Agent and its counsel to prepare the same.<\/p>\n
Section 6.5. Maintenance of Properties. Each Restricted Person will
\nmaintain, preserve, protect, and keep all Collateral and all other property used
\nor useful in the conduct of its business in good condition (ordinary wear and
\ntear excepted) and in compliance with all applicable Laws, and will from time to
\ntime make all repairs, renewals and replacements needed to enable the business
\nand operations carried on in connection therewith to be promptly and
\nadvantageously conducted at all times.<\/p>\n
Section 6.6. Maintenance of Existence and Qualifications. Each
\nRestricted Person will maintain and preserve its existence and its rights and
\nfranchises in full force and effect and will qualify to do business in all
\nstates or jurisdictions where required by applicable Law, except where the
\nfailure so to qualify will not cause a Material Adverse Change. Borrower will
\nmaintain and preserve or cause to be maintained and preserved the existence and
\nrights and franchises in full force and effect of any management service
\norganization that is not a Restricted Person, but which enters into a management
\nservice agreement on behalf of any Restricted Person.<\/p>\n
30
\n 36<\/p>\n
Section 6.7. Payment of Trade Liabilities, Taxes, etc. Each Restricted
\nPerson will (a) timely file all required tax returns; (b) timely pay all taxes,
\nassessments, and other governmental charges or levies imposed upon it or upon
\nits income, profits or property; (c) within ninety (90) days after the same
\nbecomes due pay all Liabilities owed by it on ordinary trade terms to vendors,
\nsuppliers and other Persons providing goods and services used by it in the
\nordinary course of its business; (d) pay and discharge when due all other
\nLiabilities now or hereafter owed by it; and (e) maintain appropriate accruals
\nand reserves for all of the foregoing in accordance with GAAP. Each Restricted
\nPerson may, however, delay paying or discharging any of the foregoing so long as
\nit is in good faith contesting the validity thereof by appropriate proceedings
\nand has set aside on its books adequate reserves therefor.<\/p>\n
Section 6.8. Insurance. Each Restricted Person will keep or cause to be
\nkept insured by financially sound and reputable insurers its property in
\naccordance with the Insurance Schedule. Borrower will maintain the additional
\ninsurance coverage as described in the respective Security Documents. Upon
\ndemand by Agent any insurance policies covering Collateral shall be endorsed (a)
\nto provide for payment of losses to Agent as its interests may appear, (b) to
\nprovide that such policies may not be canceled or reduced or affected in any
\nmaterial manner for any reason without fifteen days prior notice to Agent, (c)
\nto provide for any other matters specified in any applicable Security Document
\nor which Agent may reasonably require; and (d) to provide for insurance against
\nfire, casualty and any other hazards normally insured against, in the amount of
\nthe full value (less a reasonable deductible not to exceed amounts customary in
\nthe industry for similarly situated businesses and properties) of the property
\ninsured. Each Restricted Person shall at all times maintain insurance against
\nits liability for injury to persons or property in accordance with the Insurance
\nSchedule, which insurance shall be by financially sound and reputable insurers.
\nWithout limiting the foregoing, each Restricted Person shall at all time
\nmaintain liability insurance in the amounts set out on the Insurance Schedule.<\/p>\n
Section 6.9. Performance on Borrower’s Behalf. If any Restricted Person
\nfails to pay any taxes, insurance premiums, expenses, attorneys’ fees or other
\namounts it is required to pay under any Loan Document, Agent may pay the same.
\nBorrower shall immediately reimburse Agent for any such payments and each amount
\npaid by Agent shall constitute an Obligation owed hereunder which is due and
\npayable on the date such amount is paid by Agent.<\/p>\n
Section 6.10. Interest. Borrower hereby promises to each Bank Party to
\npay interest at the Default Rate on all Obligations (including Obligations to
\npay fees or to reimburse or indemnify any Bank Party) which Borrower has in this
\nAgreement promised to pay to such Bank Party and which are not paid when due.
\nSuch interest shall accrue from the date such Obligations become due until they
\nare paid.<\/p>\n
Section 6.11. Compliance with Agreements and Law. Each Restricted Person
\nwill perform all material obligations it is required to perform under the terms
\nof each indenture, mortgage, deed of trust, security agreement, lease,
\nfranchise, agreement, contract or other instrument or obligation to which it is
\na party or by which it or any of its properties is bound.<\/p>\n
31
\n 37<\/p>\n
Each Restricted Person will conduct its business and affairs in compliance with
\nall Laws applicable thereto.<\/p>\n
Section 6.12. Environmental Matters.<\/p>\n
(a) Each Restricted Person will comply in all material respects with all
\nEnvironmental Laws now or hereafter applicable to such Restricted Person and
\nshall obtain, at or prior to the time required by applicable Environmental Laws,
\nall environmental, health and safety permits, licenses and other authorizations
\nnecessary for its operations and will maintain such authorizations in full force
\nand effect.<\/p>\n
(b) Borrower will promptly furnish to Agent all written notices of
\nviolation, orders, claims, citations, complaints, penalty assessments, suits or
\nother proceedings received by Borrower, or of which it has notice, pending or
\nthreatened against Borrower, by any governmental authority with respect to any
\nalleged violation of or non-compliance with any Environmental Laws or any
\npermits, licenses or authorizations in connection with its ownership or use of
\nits properties or the operation of its business.<\/p>\n
(c) Borrower will promptly furnish to Agent all requests for
\ninformation, notices of claim, demand letters, and other notifications, received
\nby Borrower in connection with its ownership or use of its properties or the
\nconduct of its business, relating to potential responsibility with respect to
\nany investigation or clean-up of Hazardous Material at any location.<\/p>\n
Section 6.13. Evidence of Compliance. Each Restricted Person will
\nfurnish to each Bank Party at such Restricted Person’s or Borrower’s expense all
\nevidence which Agent from time to time reasonably requests in writing as to the
\naccuracy and validity of or compliance with all representations, warranties and
\ncovenants made by any Restricted Person in the Loan Documents, the satisfaction
\nof all conditions contained therein, and all other matters pertaining thereto.<\/p>\n
Section 6.14. Solvency. Upon giving effect to the issuance of the Notes,
\nthe execution of the Loan Documents by Borrower and the consummation of the
\ntransactions contemplated hereby, Borrower will be solvent (as such term is used
\nin applicable bankruptcy, liquidation, receivership, insolvency or similar
\nlaws).<\/p>\n
Section 6.15. Agreement to Deliver Security Documents.<\/p>\n
(a) Borrower agrees to deliver and to cause each other Restricted Person
\nto deliver, to further secure the Obligations whenever requested by Agent in its
\nreasonable discretion, security agreements, financing statements and other
\nSecurity Documents in form and substance satisfactory to Agent for the purpose
\nof granting, confirming, and perfecting first and prior liens or security
\ninterests in any real or personal property which is at such time Collateral or
\nwhich was intended to be Collateral pursuant to any Security Document previously
\nexecuted and not then released by Agent. Borrower will from time to time
\ndeliver, and will cause each other Restricted<\/p>\n
32
\n 38<\/p>\n
Person from time to time to deliver, to Agent any financing statements,
\ncontinuation statements, extension agreements and other documents, properly
\ncompleted and executed (and acknowledged when required) by Restricted Persons in
\nform and substance reasonably satisfactory to Agent, which Agent requests for
\nthe purpose of perfecting, confirming, or protecting any Liens or other rights
\nin Collateral securing any Obligations.<\/p>\n
(b) If Borrower’s Minimum Eligible Receivables are less than $40,000,000
\nat any time, then Parent shall deliver to Agent a security agreement in the form
\nas provided in Exhibit H, together with written evidence satisfactory to Agent
\nand its counsel that Parent has taken all corporate action necessary to duly
\napprove and authorize its execution, delivery and performance of such security
\nagreement and any other documents which it is required to execute.<\/p>\n
Section 6.16. Bank Accounts; Offset. To secure the repayment of the
\nObligations Borrower hereby grants to each Bank Party a security interest, a
\nlien, and a right of offset, each of which shall be in addition to all other
\ninterests, liens, and rights of any Bank Party at common law, under the Loan
\nDocuments, or otherwise, and each of which shall be upon and against (a) any and
\nall moneys, securities or other property (and the proceeds therefrom) of
\nBorrower now or hereafter held or received by or in transit to any Bank Party
\nfrom or for the account of Borrower, whether for safekeeping, custody, pledge,
\ntransmission, collection or otherwise, (b) any and all deposits (general or
\nspecial, time or demand, provisional or final) of Borrower with any Bank Party,
\nand (c) any other credits and claims of Borrower at any time existing against
\nany Bank Party, including claims under certificates of deposit and excluding
\nBorrower’s account number 8334001710 established with Bank One and all funds on
\ndeposit therein which shall have the sole purpose of providing collateral to
\nsecure Borrower’s obligations under the lease covering its corporate
\nheadquarters. At any time and from time to time after the occurrence of any
\nDefault, each Bank Party is hereby authorized to foreclose upon, or to offset
\nagainst the Obligations then due and payable (in either case without notice to
\nBorrower), any and all items hereinabove referred to. The remedies of
\nforeclosure and offset are separate and cumulative, and either may be exercised
\nindependently of the other without regard to procedures or restrictions
\napplicable to the other.<\/p>\n
Section 6.17. Guaranties of Borrower’s Subsidiaries. Parent and each
\ndomestic Subsidiary of Borrower, now existing or created, acquired or coming
\ninto existence after the date hereof shall, promptly upon request by Agent,
\nexecute and deliver to Agent an absolute and unconditional guaranty of the
\ntimely repayment of the Obligations and the due and punctual performance of the
\nobligations of Borrower hereunder, which guaranty shall be in the form of
\nExhibit G attached hereto. Each Subsidiary of Borrower existing on the date
\nhereof shall duly execute and deliver such a guaranty prior to the making of any
\nLoan hereunder. Borrower will cause each of its Subsidiaries to deliver to
\nAgent, simultaneously with its delivery of such a guaranty, written evidence
\nsatisfactory to Agent and its counsel that such Subsidiary has taken all
\ncorporate or partnership action necessary to duly approve and authorize its
\nexecution, delivery and performance of such guaranty and any other documents
\nwhich it is required to execute.<\/p>\n
33
\n 39<\/p>\n
Section 6.18. Audit. Allow (and cause each other Restricted Person to
\nallow) Agent or its representatives (including independent accountants,
\nauditors, agents, attorneys, appraisers, representatives of any Lender and any
\nother Persons, upon reasonable notice and during such Restricted Person’s usual
\nbusiness hours) (i) to inspect any Restricted Person’s books, records, accounts,
\nand properties (including, without limitation, a field examination by Lender’s
\nsecured lending group to test systems and controls it deems appropriate in its
\nown reasonable discretion), (ii) to make and take away copies of those books,
\nrecords, and accounts, (iii) to discuss any Restricted Person’s affairs,
\nconditions, finances, and prospects with any Restricted Person’s directors,
\nofficers, employees, or general or limited partners (or their respective
\ndirectors, officers, employees, or partners). If no Default or Potential Default
\nexists, any such audit shall be at the expense of Borrower only once during each
\ntwelve month period during the term hereof. During any time when a Default or
\nPotential Default exists each such audit performed hereunder shall be at the
\nexpense of Borrower.<\/p>\n
ARTICLE VII – Negative Covenants of Borrower<\/p>\n
To conform with the terms and conditions under which each Bank Party is
\nwilling to have credit outstanding to Borrower, and to induce each Bank Party to
\nenter into this Agreement and make the Loans, Borrower warrants, covenants and
\nagrees that until the full and final payment of the Obligations and the
\ntermination of this Agreement, unless Majority Lenders have previously agreed
\notherwise:<\/p>\n
Section 7.1. Indebtedness. No Restricted Person will in any manner owe
\nor be liable for Indebtedness except:<\/p>\n
(a) the Obligations.<\/p>\n
(b) Indebtedness outstanding under the instruments and agreements
\ndescribed on the Disclosure Schedule, excluding any renewals or extensions of
\nsuch Indebtedness and providing that the original principal amount of any such
\nIndebtedness is not in excess of the purchase price of the asset acquired
\nthereby and such Indebtedness is secured only by the acquired asset.<\/p>\n
(c) lease obligations arising pursuant to that certain Lease and
\nDevelopment Agreement dated as of November 14, 1997, between Borrower and Asset
\nXVII Holdings Company, L.L.C., together with all amendments and supplements
\nthereto.<\/p>\n
(d) purchase money Indebtedness or capital lease obligations in an
\naggregate Consolidated principal amount not to exceed $3,000,000 at any time
\n(excluding those lease obligations permitted in 7.1 (c) above), provided that
\nthe original principal amount of any such Indebtedness shall not be in excess of
\nthe purchase price of the asset acquired thereby and such Indebtedness shall be
\nsecured only by the acquired asset; provided that if Borrower requests that<\/p>\n
34
\n 40<\/p>\n
Lenders consent to an increase in such amount, Lenders’ consent shall not be
\nunreasonably withheld.<\/p>\n
(e) Indebtedness arising under Hedging Contracts permitted under Section
\n7.3 provided that no such contract requires any Restricted Person to meet margin
\ncalls, or otherwise to put up money or other assets against the event of its
\nnonperformance, prior to actual default by such Restricted Person in performing
\nits obligations thereunder.<\/p>\n
Section 7.2. Limitation on Liens. No Restricted Person will create,
\nassume or permit to exist any Lien upon any of the properties or assets which it
\nnow owns or hereafter acquires, except, to the extent not otherwise forbidden by
\nthe Security Documents the following (“Permitted Liens”):<\/p>\n
(a) Liens which secure Obligations only.<\/p>\n
(b) Statutory Liens for taxes, statutory mechanics’ and materialmen’s
\nLiens incurred in the ordinary course of business, and other similar Liens
\nincurred in the ordinary course of business, provided such Liens do not secure
\nIndebtedness and secure only Indebtedness which is not delinquent or which is
\nbeing contested as provided in Section 6.6.<\/p>\n
(c) Liens securing Indebtedness described in Section 7.1(c) and leases
\nwith Bank One Leasing described in the Disclosure Schedule.<\/p>\n
Section 7.3. Hedging. No Restricted Person will be a party to or in any
\nmanner be liable on any Hedging Contract except:<\/p>\n
(a) contracts entered into by a Restricted Person with the purpose and
\neffect of fixing interest rates on a principal amount of indebtedness of such
\nRestricted Person that is accruing interest at a variable rate, provided that
\n(i) the aggregate notional amount of such contracts never exceeds seventy-five
\npercent (75%) of the anticipated outstanding principal balance of the
\nindebtedness to be hedged by such contracts or an average of such principal
\nbalances calculated using a generally accepted method of matching interest swap
\ncontracts to declining principal balances, (ii) the floating rate index of each
\nsuch contract generally matches the index used to determine the floating rates
\nof interest on the corresponding indebtedness to be hedged by such contract and
\n(iii) each such contract is with a counterparty or has a guarantor of the
\nobligations of the counterparty who (unless such counterparty is a Lender or one
\nof its Affiliates) at the time the contract is made has long-term obligations
\nrated AA or Aa2 or better, respectively, by either Rating Agency.<\/p>\n
(b) interest rate swaps currently in place between Borrower and any
\nAffiliate of Agent (and any replacement swap in substantially the same terms)
\nwith respect to that certain Lease and Development Agreement dated as of
\nNovember 14, 1997, between Borrower and Asset XVII Holdings Company, L.L.C.,
\ntogether with all amendments and supplements thereto.<\/p>\n
35
\n 41<\/p>\n
Section 7.4. Limitation on Mergers, Issuances of Securities. Except as
\nexpressly provided in this subsection no Restricted Person will merge or
\nconsolidate with or into any other business entity. Any Subsidiary of Borrower
\nmay, however, be merged into or consolidated with (i) another Subsidiary of
\nBorrower, so long as a Guarantor is the surviving business entity, or (ii)
\nBorrower, so long as Borrower is the surviving business entity. No Restricted
\nPerson will issue any additional shares of its capital stock or other securities
\nor any options, warrants or other rights to acquire such additional shares or
\nother securities, except that Borrower’s wholly-owned Subsidiaries may issue
\nsuch shares, options, warrants or other rights to Borrower, and Borrower may
\nissue its common stock and warrants to purchase its common stock, but only to
\nthe extent not otherwise forbidden under the terms hereof. No Subsidiary of
\nBorrower which is a partnership will allow any diminution of Borrower’s interest
\n(direct or indirect) therein.<\/p>\n
Section 7.5. Limitation on Sales of Property. No Restricted Person will
\nsell, transfer, lease, exchange, alienate or dispose of any of its material
\nassets or properties or any material interest therein except equipment which is
\nworthless or obsolete or which is replaced by equipment of equal suitability and
\nvalue. Neither Borrower nor any of Borrower’s Subsidiaries will sell, transfer
\nor otherwise dispose of capital stock of any of Borrower’s Subsidiaries except
\nthat any Subsidiary of Borrower may sell or issue its own capital stock to the
\nextent not otherwise prohibited hereunder. No Restricted Person will discount,
\nsell, pledge or assign any notes payable to it, accounts receivable or future
\nincome except to the extent expressly permitted under the Loan Documents.<\/p>\n
Section 7.6. Limitation on Dividends and Redemptions. No Restricted
\nPerson will declare or pay any dividends on, or make any other distribution in
\nrespect of, any class of its capital stock or any partnership or other interest
\nin it, nor will any Restricted Person directly or indirectly make any capital
\ncontribution to or purchase, redeem, acquire or retire any shares of the capital
\nstock of or partnership interests in any Restricted Person (whether such
\ninterests are now or hereafter issued, outstanding or created), or cause or
\npermit any reduction or retirement of the capital stock of any Restricted
\nPerson. The foregoing provisions of this Section 7.6 notwithstanding, so long as
\nno Default or Event of Default has occurred and is continuing (i) Borrower may
\ndeclare and pay dividends in its common stock and (ii) Parent may repurchase its
\ncommon stock so long as the price for all such common stock paid by Parent may
\nnot exceed $15,000,000 in the aggregate.<\/p>\n
Section 7.7. Limitation on Investments and New Businesses. No Restricted
\nPerson will (i) make any expenditure or commitment or incur any obligation or
\nenter into or engage in any transaction except in the ordinary course of<\/p>\n
36
\n 42<\/p>\n
business, (ii) engage directly or indirectly in any business or conduct any
\noperations except in connection with or incidental to its present businesses and
\noperations, (iii) make any acquisitions of or capital contributions to or other
\ninvestments in any Person, other than Permitted Investments.<\/p>\n
Section 7.8. Limitation on Credit Extensions. Except for Permitted
\nInvestments, no Restricted Person will extend credit, make advances or make
\nloans other than (i) normal and prudent extensions of credit to customers buying
\ngoods and services in the ordinary course of business, which extensions shall
\nnot be for longer periods than those extended by similar businesses operated in
\na normal and prudent manner, and (ii) loans to Parent in an aggregate amount not
\nto exceed $25,000,000, which shall be evidenced by a promissory note in form and
\nsubstance acceptable to Agent.<\/p>\n
Section 7.9. Transactions with Affiliates. Neither Borrower nor any of
\nits Subsidiaries will engage in any material transaction with any of its
\nAffiliates on terms which are less favorable to it than those which would have
\nbeen obtainable at the time in arm’s-length dealing with Persons other than such
\nAffiliates, provided that such restriction shall not apply to transactions among
\nBorrower, Parent and Borrower’s wholly owned Subsidiaries.<\/p>\n
Section 7.10. Certain Contracts; Amendments; Multiemployer ERISA Plans.
\nExcept as expressly provided for in the Loan Documents, no Restricted Person
\nwill, directly or indirectly, enter into, create, or otherwise allow to exist
\nany contract or other consensual restriction on the ability of any Subsidiary of
\nBorrower to: (i) pay dividends or make other distributions to Borrower, (ii) to
\nredeem equity interests held in it by Borrower, (iii) to repay loans and other
\nindebtedness owing by it to Borrower, or (iv) to transfer any of its assets to
\nBorrower. No Restricted Person will amend or permit any amendment to any
\ncontract or lease which releases, qualifies, limits, makes contingent or
\notherwise detrimentally affects the rights and benefits of Agent or any Lender
\nunder or acquired pursuant to any Security Documents. No Restricted Person will
\nestablish or incur any obligation to contribute to any ERISA Plan.<\/p>\n
Section 7.11. Minimum Net Worth. The Consolidated Net Worth at the end
\nof each Fiscal Quarter will not be less than $175,000,000.<\/p>\n
ARTICLE VIII – Events of Default and Remedies<\/p>\n
Section 8.1. Events of Default. Each of the following events constitutes
\nan Event of Default under this Agreement:<\/p>\n
(a) Any Restricted Person fails to pay any Obligation within five (5)
\nBusiness Days after the date when due, whether at a date for the payment of a
\nfixed installment or as a contingent or other payment becomes due and payable or
\nas a result of acceleration or otherwise;<\/p>\n
(b) Any “default” or “event of default” occurs under any Loan Document
\nwhich defines either such term, and the same is not remedied within the
\napplicable period of grace (if any) provided in such Loan Document;<\/p>\n
(c) Any Restricted Person fails to duly observe, perform or comply with
\nany covenant, agreement or provision of Section 6.4 or Article VII and such
\nfailure remains unremedied for a period of fifteen (15) days after the earlier
\nto occur of: (i) written notice thereof is given by Agent to the Borrower or
\n(ii) any Restricted Person otherwise becomes aware of such failure;<\/p>\n
37
\n 43<\/p>\n
(d) Any Restricted Person fails (other than as referred to in
\nsubsections (a), (b), (c) or (d) above) to duly observe, perform or comply with
\nany covenant, agreement, condition or provision of any Loan Document, and such
\nfailure remains unremedied for a period of thirty (30) days after written notice
\nof such failure is given by Agent to Borrower;<\/p>\n
(e) Any representation or warranty previously, presently or hereafter
\nmade in writing by or on behalf of any Restricted Person in connection with any
\nLoan Document shall prove to have been false or incorrect in any material
\nrespect on any date on or as of which made, or any Loan Document at any time
\nceases to be valid, binding and enforceable as warranted in Section 5.5 for any
\nreason other than its release or subordination by Agent;<\/p>\n
(f) Any Restricted Person fails to duly observe, perform or comply with
\nany agreement with any Person or any term or condition of any instrument, if
\nsuch agreement or instrument is materially significant to Borrower or to
\nBorrower and its subsidiaries on a Consolidated basis or materially significant
\nto any Guarantor, and such failure is not remedied within the applicable period
\nof grace (if any) provided in such agreement or instrument;<\/p>\n
(g) Subject to Section 6.7, any Restricted Person (i) fails to pay any
\nportion, when such portion is due, of any of its Indebtedness in excess of
\n$350,000 or (ii) breaches or defaults in the performance of any agreement or
\ninstrument by which any such Indebtedness is issued, evidenced, governed, or
\nsecured, and any such failure, breach or default continues beyond any applicable
\nperiod of grace provided therefor;<\/p>\n
(h) Any Restricted Person:<\/p>\n
(i) suffers the entry against it of a judgment, decree or order for
\n relief by a Tribunal of competent jurisdiction in an involuntary
\n proceeding commenced under any applicable bankruptcy, insolvency or
\n other similar Law of any jurisdiction now or hereafter in effect,
\n including the federal Bankruptcy Code, as from time to time amended, or
\n has any such proceeding commenced against it which remains undismissed
\n for a period of thirty days; or<\/p>\n
(ii) commences a voluntary case under any applicable bankruptcy,
\n insolvency or similar Law now or hereafter in effect, including the
\n federal Bankruptcy Code, as from time to time amended; or applies for or
\n consents to the entry of an order for relief in an involuntary case
\n under any such Law; or makes a general assignment for the benefit of
\n creditors; or fails generally to pay (or admits in writing its inability
\n to pay) its debts as such debts become due; or takes corporate or other
\n action to authorize any of the foregoing; or<\/p>\n
(iii) suffers the appointment of or taking possession by a
\n receiver, liquidator, assignee, custodian, trustee, sequestrator or
\n similar official of all or a substantial part of its assets or of any
\n part of the Collateral in a proceeding brought against or initiated by<\/p>\n
38
\n 44<\/p>\n
it, and such appointment or taking possession is neither made
\n ineffective nor discharged within thirty days after the making thereof,
\n or such appointment or taking possession is at any time consented to,
\n requested by, or acquiesced to by it; or<\/p>\n
(iv) suffers the entry against it of a final judgment for the
\n payment of money in excess of $1,000,000 (not covered by insurance
\n satisfactory to Agent in its discretion), unless the same is discharged
\n within thirty days after the date of entry thereof or an appeal or
\n appropriate proceeding for review thereof is taken within such period
\n and a stay of execution pending such appeal is obtained; or<\/p>\n
(v) suffers a writ or warrant of attachment or any similar process
\n to be issued by any Tribunal against all or any substantial part of its
\n assets or any part of the Collateral, and such writ or warrant of
\n attachment or any similar process is not stayed or released within
\n thirty days after the entry or levy thereof or after any stay is vacated
\n or set aside; and<\/p>\n
(i) Any Material Adverse Change occurs.<\/p>\n
Upon the occurrence of an Event of Default described in subsection (h)(i),
\n(h)(ii) or (h)(iii) of this section with respect to Borrower, all of the
\nObligations shall thereupon be immediately due and payable, without demand,
\npresentment, notice of demand or of dishonor and nonpayment, protest, notice of
\nprotest, notice of intention to accelerate, declaration or notice of
\nacceleration, or any other notice or declaration of any kind, all of which are
\nhereby expressly waived by Borrower and each Restricted Person who at any time
\nratifies or approves this Agreement. Upon any such acceleration, any obligation
\nof any Lender to make any further Loans shall be permanently terminated. During
\nthe continuance of any other Event of Default, Agent at any time and from time
\nto time may (and upon written instructions from Majority Lenders, Agent shall),
\nwithout notice to Borrower or any other Restricted Person, do either or both of
\nthe following: (1) terminate any obligation of Lenders to make Loans hereunder,
\nand (2) declare any or all of the Obligations immediately due and payable, and
\nall such Obligations shall thereupon be immediately due and payable, without
\ndemand, presentment, notice of demand or of dishonor and nonpayment, protest,
\nnotice of protest, notice of intention to accelerate, declaration or notice of
\nacceleration, or any other notice or declaration of any kind, all of which are
\nhereby expressly waived by Borrower and each Restricted Person who at any time
\nratifies or approves this Agreement.<\/p>\n
Section 8.2. Remedies. If any Default shall occur and be continuing,
\neach Bank Party may protect and enforce its rights under the Loan Documents by
\nany appropriate proceedings, including proceedings for specific performance of
\nany covenant or agreement contained in any Loan Document, and each Bank Party
\nmay enforce the payment of any Obligations due it or enforce any other legal or
\nequitable right which it may have. All rights, remedies and powers conferred
\nupon Bank Parties under the Loan Documents shall be deemed cumulative and not
\nexclusive of any other rights, remedies or powers available under the Loan
\nDocuments or at Law or in equity.<\/p>\n
39
\n 45<\/p>\n
ARTICLE IX – Agent<\/p>\n
Section 9.1. Appointment and Authority. Each Lender which becomes a
\nparty to this Agreement hereby irrevocably authorizes Agent, and Agent hereby
\nundertakes, to receive payments of principal, interest and other amounts due
\nhereunder as specified herein and to take all other actions and to exercise such
\npowers under the Loan Documents as are specifically delegated to Agent by the
\nterms hereof or thereof, together with all other powers reasonably incidental
\nthereto. The relationship of Agent to the other Bank Parties is only that of one
\ncommercial lender acting as administrative agent for others, and nothing in the
\nLoan Documents shall be construed to constitute Agent a trustee or other
\nfiduciary for any holder of any of the Notes or of any participation therein nor
\nto impose on Agent duties and obligations other than those expressly provided
\nfor in the Loan Documents. With respect to any matters not expressly provided
\nfor in the Loan Documents and any matters which the Loan Documents place within
\nthe discretion of Agent, Agent shall not be required to exercise any discretion
\nor take any action, and it may request instructions from Lenders with respect to
\nany such matter, in which case it shall be required to act or to refrain from
\nacting (and shall be fully protected and free from liability to all Lenders in
\nso acting or refraining from acting) upon the instructions of Majority Lenders
\n(including itself), provided, however, that Agent shall not be required to take
\nany action which exposes it to a risk of personal liability that it considers
\nunreasonable or which is contrary to the Loan Documents or to applicable Law.
\nUpon receipt by Agent from Borrower of any communication calling for action on
\nthe part of Lenders or upon notice from any other Bank Party to Agent of any
\nDefault or Event of Default, Agent shall promptly notify each other Bank Party
\nthereof.<\/p>\n
Section 9.2. Exculpation, Agent’s Reliance, Etc. Neither Agent nor any
\nof its directors, officers, agents, attorneys, or employees shall be liable for
\nany action taken or omitted to be taken by any of them under or in connection
\nwith the Loan Documents, INCLUDING THEIR NEGLIGENCE OF ANY KIND, except that
\neach shall be liable for its own gross negligence or willful misconduct. Without
\nlimiting the generality of the foregoing, Agent (a) may treat the payee of any
\nNote as the holder thereof until Agent receives written notice of the assignment
\nor transfer thereof in accordance with this Agreement, signed by such payee and
\nin form satisfactory to Agent; (b) may consult with legal counsel (including
\ncounsel for Borrower), independent public accountants and other experts selected
\nby it and shall not be liable for any action taken or omitted to be taken in
\ngood faith by it in accordance with the advice of such counsel, accountants or
\nexperts; (c) makes no warranty or representation to any other Bank Party and
\nshall not be responsible to any other Bank Party for any statements, warranties
\nor representations made in or in connection with the Loan Documents; (d) shall
\nnot have any duty to ascertain or to inquire as to the performance or observance
\nof any of the terms, covenants or conditions of the Loan Documents on the part
\nof any Restricted Person or to inspect the property (including the books and
\nrecords) of any Restricted Person; (e) shall not be responsible to any other
\nBank Party for the due execution, legality, validity, enforceability,
\ngenuineness, sufficiency or value of any Loan Document or any instrument or
\ndocument furnished in connection therewith; (f) may rely upon the
\nrepresentations and warranties of each Restricted Person and the Lenders in
\nexercising its<\/p>\n
40
\n 46<\/p>\n
powers hereunder; and (g) shall incur no liability under or in respect of the
\nLoan Documents by acting upon any notice, consent, certificate or other
\ninstrument or writing (including any telecopy, telegram, cable or telex)
\nbelieved by it to be genuine and signed or sent by the proper Person or Persons.<\/p>\n
Section 9.3. Credit Decisions. Each Bank Party acknowledges that it has,
\nindependently and without reliance upon any other Bank Party, made its own
\nanalysis of Borrower and the transactions contemplated hereby and its own
\nindependent decision to enter into this Agreement and the other Loan Documents.
\nEach Bank Party also acknowledges that it will, independently and without
\nreliance upon any other Bank Party and based on such documents and information
\nas it shall deem appropriate at the time, continue to make its own credit
\ndecisions in taking or not taking action under the Loan Documents.<\/p>\n
Section 9.4. Indemnification. Each Lender agrees to indemnify Agent (to
\nthe extent not reimbursed by Borrower within ten (10) days after demand) from
\nand against such Lender’s Percentage Share of any and all liabilities,
\nobligations, claims, losses, damages, penalties, fines, actions, judgments,
\nsuits, settlements, costs, expenses or disbursements (including reasonable fees
\nof attorneys, accountants, experts and advisors) of any kind or nature
\nwhatsoever (in this section collectively called “liabilities and costs”) which
\nto any extent (in whole or in part) may be imposed on, incurred by, or asserted
\nagainst Agent growing out of, resulting from or in any other way associated with
\nany of the Collateral, the Loan Documents and the transactions and events
\n(including the enforcement thereof) at any time associated therewith or
\ncontemplated therein (including any violation or noncompliance with any
\nEnvironmental Laws by any Person or any liabilities or duties of any Person with
\nrespect to Hazardous Materials found in or released into the environment).<\/p>\n
THE FOREGOING INDEMNIFICATION SHALL APPLY WHETHER OR NOT SUCH LIABILITIES AND
\nCOSTS ARE IN ANY WAY OR TO ANY EXTENT OWED, IN WHOLE OR IN PART, UNDER ANY CLAIM
\nOR THEORY OF STRICT LIABILITY, OR ARE CAUSED, IN WHOLE OR IN PART, BY ANY
\nNEGLIGENT ACT OR OMISSION OF ANY KIND BY AGENT,<\/p>\n
provided only that no Lender shall be obligated under this section to indemnify
\nAgent for that portion, if any, of any liabilities and costs which is
\nproximately caused by Agent’s own individual gross negligence or willful
\nmisconduct, as determined in a final judgment. Cumulative of the foregoing, each
\nLender agrees to reimburse Agent promptly upon demand for such Lender’s
\nPercentage Share of any costs and expenses to be paid to Agent by Borrower under
\nSection 10.4(a) to the extent that Agent is not timely reimbursed for such
\nexpenses by Borrower as provided in such section. As used in this section the
\nterm “Agent” shall refer not only to the Person designated as such in Section
\n1.1 but also to each director, officer, agent, attorney, employee,
\nrepresentative and Affiliate of such Person.<\/p>\n
41
\n 47<\/p>\n
Section 9.5. Rights as Lender. In its capacity as a Lender, Agent shall
\nhave the same rights and obligations as any Lender and may exercise such rights
\nas though it were not Agent. Agent may accept deposits from, lend money to, act
\nas Trustee under indentures of, and generally engage in any kind of business
\nwith any Restricted Person or their Affiliates, all as if it were not Agent
\nhereunder and without any duty to account therefor to any other Lender.<\/p>\n
Section 9.6. Sharing of Set-Offs and Other Payments. Each Bank Party
\nagrees that if it shall, whether through the exercise of rights under Security
\nDocuments or rights of banker’s lien, set off, or counterclaim against Borrower
\nor otherwise, obtain payment of a portion of the aggregate Obligations owed to
\nit which, taking into account all distributions made by Agent under Section 3.1,
\ncauses such Bank Party to have received more than it would have received had
\nsuch payment been received by Agent and distributed pursuant to Section 3.1,
\nthen (a) it shall be deemed to have simultaneously purchased and shall be
\nobligated to purchase interests in the Obligations as necessary to cause all
\nBank Parties to share all payments as provided for in Section 3.1, and (b) such
\nother adjustments shall be made from time to time as shall be equitable to
\nensure that Agent and all Lenders share all payments of Obligations as provided
\nin Section 3.1; provided, however, that nothing herein contained shall in any
\nway affect the right of any Bank Party to obtain payment (whether by exercise of
\nrights of banker’s lien, set-off or counterclaim or otherwise) of indebtedness
\nother than the Obligations. Borrower expressly consents to the foregoing
\narrangements and agrees that any holder of any such interest or other
\nparticipation in the Obligations, whether or not acquired pursuant to the
\nforegoing arrangements, may to the fullest extent permitted by Law exercise any
\nand all rights of banker’s lien, set-off, or counterclaim as fully as if such
\nholder were a holder of the Obligations in the amount of such interest or other
\nparticipation. If all or any part of any funds transferred pursuant to this
\nsection is thereafter recovered from the seller under this section which
\nreceived the same, the purchase provided for in this section shall be deemed to
\nhave been rescinded to the extent of such recovery, together with interest, if
\nany, if interest is required pursuant to Tribunal order to be paid on account of
\nthe possession of such funds prior to such recovery.<\/p>\n
Section 9.7. Investments. Whenever Agent in good faith determines that
\nit is uncertain about how to distribute to Lenders any funds which it has
\nreceived, or whenever Agent in good faith determines that there is any dispute
\namong Lenders about how such funds should be distributed, Agent may choose to
\ndefer distribution of the funds which are the subject of such uncertainty or
\ndispute. If Agent in good faith believes that the uncertainty or dispute will
\nnot be promptly resolved, or if Agent is otherwise required to invest funds
\npending distribution to Lenders, Agent shall invest such funds pending
\ndistribution; all interest on any such investment shall be distributed upon the
\ndistribution of such investment and in the same proportion and to the same
\nPersons as such investment. All moneys received by Agent for distribution to
\nLenders (other than to the Person who is Agent in its separate capacity as a
\nLender) shall be held by Agent pending such distribution solely as Agent for
\nsuch Lenders, and Agent shall have no equitable title to any portion thereof.<\/p>\n
Section 9.8. Benefit of Article IX. The provisions of this Article
\n(other than the following Section 9.9) are intended solely for the benefit of
\nBank Parties, and no Restricted<\/p>\n
42
\n 48<\/p>\n
Person shall be entitled to rely on any such provision or assert any such
\nprovision in a claim or defense against any Bank Party. Bank Parties may waive
\nor amend such provisions as they desire without any notice to or consent of
\nBorrower or any Restricted Person.<\/p>\n
Section 9.9. Resignation. Agent may resign at any time by giving written
\nnotice thereof to Lenders and Borrower. Each such notice shall set forth the
\ndate of such resignation. Upon any such resignation Lenders having aggregate
\nPercentage Shares of at least one hundred percent (100%) shall have the right to
\nappoint a successor Agent. A successor must be appointed for any retiring Agent,
\nand such Agent’s resignation shall become effective when such successor accepts
\nsuch appointment. If, within thirty days after the date of the retiring Agent’s
\nresignation, no successor Agent has been appointed and has accepted such
\nappointment, then the retiring Agent may appoint a successor Agent, which shall
\nbe a commercial bank organized or licensed to conduct a banking or trust
\nbusiness under the Laws of the United States of America or of any state thereof.
\nUpon the acceptance of any appointment as Agent hereunder by a successor Agent,
\nthe retiring Agent shall be discharged from its duties and obligations under
\nthis Agreement and the other Loan Documents. After any retiring Agent’s
\nresignation hereunder the provisions of this Article IX shall continue to inure
\nto its benefit as to any actions taken or omitted to be taken by it while it was
\nAgent under the Loan Documents.<\/p>\n
ARTICLE X – Miscellaneous<\/p>\n
Section 10.1. Waivers and Amendments; Acknowledgments.<\/p>\n
(a) Waivers and Amendments. No failure or delay (whether by course of
\nconduct or otherwise) by any Bank Party in exercising any right, power or remedy
\nwhich such Bank Party may have under any of the Loan Documents shall operate as
\na waiver thereof or of any other right, power or remedy, nor shall any single or
\npartial exercise by any Bank Party of any such right, power or remedy preclude
\nany other or further exercise thereof or of any other right, power or remedy. No
\nwaiver of any provision of any Loan Document and no consent to any departure
\ntherefrom shall ever be effective unless it is in writing and signed as provided
\nbelow in this section, and then such waiver or consent shall be effective only
\nin the specific instances and for the purposes for which given and to the extent
\nspecified in such writing. No notice to or demand on any Restricted Person shall
\nin any case of itself entitle any Restricted Person to any other or further
\nnotice or demand in similar or other circumstances. This Agreement and the other
\nLoan Documents set forth the entire understanding between the parties hereto
\nwith respect to the transactions contemplated herein and therein and supersede
\nall prior discussions and understandings with respect to the subject matter
\nhereof and thereof, and no waiver, consent, release, modification or amendment
\nof or supplement to this Agreement or the other Loan Documents shall be valid or
\neffective against any party hereto unless the same is in writing and signed by
\n(i) if such party is Borrower, by Borrower, (ii) if such party is Agent, by
\nAgent, and (iii) if such party is a Lender, by such Lender or by Agent on behalf
\nof such Lender with the written consent of Majority Lenders (which consent has
\nalready been given as to the termination of the Loan Documents as provided in
\nSection 10.9). Anything to the contrary herein<\/p>\n
43
\n 49<\/p>\n
notwithstanding, Agent shall not, without the prior consent of each individual
\nLender, execute and deliver on behalf of such Lender any waiver or amendment
\nwhich would: (1) waive any of the conditions specified in Article IV (provided
\nthat Agent may in its discretion withdraw any request it has made under Section
\n4.2(f)), (2) increase the commitment of such Lender or subject such Lender to
\nany additional obligations, (3) reduce any fees payable to such Lender
\nhereunder, or the principal of, or interest on, such Lender’s Note, (4) postpone
\nany date fixed for any payment of any such fees, principal or interest, or (5)
\nrelease Borrower from its obligation to pay such Lender’s Note or any Guarantor
\nfrom its guaranty of such payment or, (6) release any Collateral, or (7) amend
\nthe definition of Marketable Securities Collateral set forth in Section 1.1.<\/p>\n
(b) Acknowledgments and Admissions. Borrower hereby represents,
\nwarrants, acknowledges and admits that (i) it has been advised by counsel in the
\nnegotiation, execution and delivery of the Loan Documents to which it is a
\nparty, (ii) it has made an independent decision to enter into this Agreement and
\nthe other Loan Documents to which it is a party, without reliance on any
\nrepresentation, warranty, covenant or undertaking by Agent or any Lender,
\nwhether written, oral or implicit, other than as expressly set out in this
\nAgreement or in another Loan Document delivered on or after the date hereof,
\n(iii) there are no representations, warranties, covenants, undertakings or
\nagreements by any Bank Party as to the Loan Documents except as expressly set
\nout in this Agreement or in another Loan Document delivered on or after the date
\nhereof, (iv) no Bank Party has any fiduciary obligation toward Borrower with
\nrespect to any Loan Document or the transactions contemplated thereby, (v) the
\nrelationship pursuant to the Loan Documents between Borrower and the other
\nRestricted Persons, on one hand, and each Bank Party, on the other hand, is and
\nshall be solely that of debtor and creditor, respectively, (vi) no partnership
\nor joint venture exists with respect to the Loan Documents between any
\nRestricted Person and any Bank Party, (vii) Agent is not Borrower’s Agent, but
\nAgent for Lenders, (viii) should an Event of Default or Default occur or exist,
\neach Bank Party will determine in its sole discretion and for its own reasons
\nwhat remedies and actions it will or will not exercise or take at that time,
\n(ix) without limiting any of the foregoing, Borrower is not relying upon any
\nrepresentation or covenant by any Bank Party, or any representative thereof, and
\nno such representation or covenant has been made, that any Bank Party will, at
\nthe time of an Event of Default or Default, or at any other time, waive,
\nnegotiate, discuss, or take or refrain from taking any action permitted under
\nthe Loan Documents with respect to any such Event of Default or Default or any
\nother provision of the Loan Documents, and (x) all Bank Parties have relied upon
\nthe truthfulness of the acknowledgments in this section in deciding to execute
\nand deliver this Agreement and to become obligated hereunder.<\/p>\n
(c) Representation by Lenders. Each Lender hereby represents that it
\nwill acquire its Note for its own account in the ordinary course of its lending
\nbusiness; however, the disposition of such Lender’s property shall at all times
\nbe and remain within its control and, in particular and without limitation, such
\nLender may sell or otherwise transfer its Note, any participation interest or
\nother interest in its Note, or any of its other rights and obligations under the
\nLoan Documents.<\/p>\n
44
\n 50<\/p>\n
(d) Joint Acknowledgment. THIS WRITTEN AGREEMENT AND THE OTHER LOAN
\nDOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE
\nCONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR SUBSEQUENT ORAL
\nAGREEMENTS OF THE PARTIES. <\/p>\n
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.<\/p>\n
Section 10.2. Survival of Agreements; Cumulative Nature. All of
\nRestricted Persons’ various representations, warranties, covenants and
\nagreements in the Loan Documents shall survive the execution and delivery of
\nthis Agreement and the other Loan Documents and the performance hereof and
\nthereof, including the making or granting of the Loans and the delivery of the
\nNotes and the other Loan Documents, and shall further survive until all of the
\nObligations are paid in full to each Bank Party and all of Bank Parties’
\nobligations to Borrower are terminated. All statements and agreements contained
\nin any certificate or other instrument delivered by any Restricted Person to any
\nBank Party under any Loan Document shall be deemed representations and
\nwarranties by Borrower or agreements and covenants of Borrower under this
\nAgreement. The representations, warranties, indemnities, and covenants made by
\nRestricted Persons in the Loan Documents, and the rights, powers, and privileges
\ngranted to Bank Parties in the Loan Documents, are cumulative, and, except for
\nexpressly specified waivers and consents, no Loan Document shall be construed in
\nthe context of another to diminish, nullify, or otherwise reduce the benefit to
\nany Bank Party of any such representation, warranty, indemnity, covenant, right,
\npower or privilege. In particular and without limitation, no exception set out
\nin this Agreement to any representation, warranty, indemnity, or covenant herein
\ncontained shall apply to any similar representation, warranty, indemnity, or
\ncovenant contained in any other Loan Document, and each such similar
\nrepresentation, warranty, indemnity, or covenant shall be subject only to those
\nexceptions which are expressly made applicable to it by the terms of the various
\nLoan Documents.<\/p>\n
Section 10.3. Notices. All notices, requests, consents, demands and
\nother communications required or permitted under any Loan Document shall be in
\nwriting, unless otherwise specifically provided in such Loan Document (provided
\nthat Agent may give telephonic notices to the other Bank Parties), and shall be
\ndeemed sufficiently given or furnished if delivered by personal delivery, by
\ntelecopy or telex, by delivery service with proof of delivery, or by registered
\nor certified United States mail, postage prepaid, to Borrower and Restricted
\nPersons at the address of Borrower specified on the signature pages hereto and
\nto each Bank Party at its address specified on the signature pages hereto
\n(unless changed by similar notice in writing given by the particular Person
\nwhose address is to be changed). Any such notice or communication shall be
\ndeemed to have been given (a) in the case of personal delivery or delivery
\nservice, as of the date of first attempted delivery during normal business hours
\nat the address provided herein, (b) in the case of telecopy or telex, upon
\nreceipt, or (c) in the case of registered or certified United States mail, three
\ndays after deposit in the mail; provided, however, that no Request for Loan
\nshall become effective until actually received by Agent.<\/p>\n
45
\n 51<\/p>\n
Section 10.4. Payment of Expenses; Indemnity.<\/p>\n
(a) Payment of Expenses. Whether or not the transactions contemplated by
\nthis Agreement are consummated, Borrower will promptly (and in any event, within
\n30 days after any invoice or other statement or notice) pay: (i) all transfer,
\nstamp, mortgage, documentary or other similar taxes, assessments or charges
\nlevied by any governmental or revenue authority in respect of this Agreement or
\nany of the other Loan Documents or any other document referred to herein or
\ntherein, (ii) all reasonable costs and expenses incurred by or on behalf of
\nAgent (including reasonable attorneys’ fees, consultants’ fees and engineering
\nfees, travel costs and miscellaneous expenses) in connection with (1) the
\nnegotiation, preparation, execution and delivery of the Loan Documents, and any
\nand all consents, waivers or other documents or instruments relating thereto,
\n(2) the filing, recording, refiling and re-recording of any Loan Documents and
\nany other documents or instruments or further assurances required to be filed or
\nrecorded or refiled or re-recorded by the terms of any Loan Document, (3) the
\nborrowings hereunder and other action reasonably required in the course of
\nadministration hereof, (4) monitoring or confirming (or preparation or
\nnegotiation of any document related to) Borrower’s compliance with any covenants
\nor conditions contained in this Agreement or in any Loan Document, and (iii) all
\nreasonable costs and expenses incurred by or on behalf of any Bank Party
\n(including reasonable attorneys’ fees, consultants’ fees and accounting fees) in
\nconnection with the defense or enforcement of any of the Loan Documents with
\nrespect to the obligations of Borrowers (including this section) or the defense
\nof any Bank Party’s exercise of its rights thereunder with respect to the
\nobligations of Borrower. In addition to the foregoing, until and all Obligations
\nhave been paid in full, Borrower will also pay or reimburse Agent for all
\nreasonable out-of-pocket costs and expenses of Agent or its agents or employees
\nin connection with the continuing administration of the Loans and the related
\ndue diligence of Agent, including travel and miscellaneous expenses and fees and
\nexpenses of Agent’s outside counsel, reserve engineers and consultants engaged
\nin connection with the Loan Documents.<\/p>\n
(b) Indemnity. Borrower agrees to indemnify each Bank Party, upon
\ndemand, from and against any and all liabilities, obligations, claims, losses,
\ndamages, penalties, fines, actions, judgments, suits, settlements, costs,
\nexpenses or disbursements (including reasonable fees of attorneys, accountants,
\nexperts and advisors) of any kind or nature whatsoever (in this section
\ncollectively called “liabilities and costs”) which to any extent (in whole or in
\npart) may be imposed on, incurred by, or asserted against such Bank Party
\ngrowing out of, resulting from or in any other way associated with any of the
\nCollateral, the Loan Documents and the transactions and events (including the
\nenforcement or defense thereof) at any time associated therewith or contemplated
\ntherein (including any violation or noncompliance with any Environmental Laws by
\nany Restricted Person or any liabilities or duties of any Restricted Person or
\nany Bank Party with respect to Hazardous Materials found in or released into the
\nenvironment).<\/p>\n
THE FOREGOING INDEMNIFICATION SHALL APPLY WHETHER OR NOT SUCH LIABILITIES AND
\nCOSTS ARE IN ANY WAY OR TO ANY EXTENT OWED, IN WHOLE OR IN PART, UNDER ANY CLAIM
\nOR THEORY OF STRICT LIABILITY, OR ARE<\/p>\n
46
\n 52<\/p>\n
CAUSED, IN WHOLE OR IN PART, BY ANY NEGLIGENT ACT OR OMISSION OF ANY KIND BY ANY
\nBANK PARTY,<\/p>\n
provided only that no Bank Party shall be entitled under this section to receive
\nindemnification for that portion, if any, of any liabilities and costs which is
\nproximately caused by its own individual gross negligence or willful misconduct,
\nas determined in a final judgment. If any Person (including Borrower or any of
\nits Affiliates) ever alleges such gross negligence or willful misconduct by any
\nBank Party, the indemnification provided for in this section shall nonetheless
\nbe paid upon demand, subject to later adjustment or reimbursement, until such
\ntime as a court of competent jurisdiction enters a final judgment as to the
\nextent and effect of the alleged gross negligence or willful misconduct. As used
\nin this section the term “Bank Parties” shall refer not only to the Persons
\ndesignated as such in Section 1.1 but also to each director, officer, agent,
\nattorney, employee, representative and Affiliate of such Persons.<\/p>\n
Section 10.5. Joint and Several Liability; Parties in Interest;
\nAssignments. All Obligations which are incurred by two or more Restricted
\nPersons shall be their joint and several obligations and liabilities. All
\ngrants, covenants and agreements contained in the Loan Documents shall bind and
\ninure to the benefit of the parties thereto and their respective successors and
\nassigns; provided, however, that no Restricted Person may assign or transfer any
\nof its rights or delegate any of its duties or obligations under any Loan
\nDocument without the prior consent of Agent. Neither Borrower nor any Affiliates
\nof Borrower shall directly or indirectly purchase or otherwise retire any
\nObligations owed to any Lender nor will any Lender accept any offer to do so,
\nunless each Lender shall have received substantially the same offer with respect
\nto the same Percentage Share of the Obligations owed to it. If Borrower or any
\nAffiliate of Borrower at any time purchases some but less than all of the
\nObligations owed to all Bank Parties, such purchaser shall not be entitled to
\nany rights of any Bank Party under the Loan Documents unless and until Borrower
\nor its Affiliates have purchased all of the Obligations.<\/p>\n
(b) No Lender shall sell any participation interest in its commitment
\nhereunder or any of its rights under its Loans or under the Loan Documents to
\nany Person other than an Eligible Transferee, and then only if the agreement
\nbetween such Lender and such participant at all times provides: (i) that such
\nparticipation exists only as a result of the agreement between such participant
\nand such Lender and that such transfer does not give such participant any right
\nto vote as a Lender or any other direct claims or rights against any Person
\nother than such Lender, (ii) that such participant is not entitled to payment
\nfrom any Restricted Person under Sections 3.2 through 3.6 of amounts in excess
\nof those payable to such Lender under such sections (determined without regard
\nto the sale of such participation), and (iii) unless such participant is an
\nAffiliate of such Lender, that such participant shall not be entitled to require
\nsuch Lender to take any action under any Loan Document or to obtain the consent
\nof such participant prior to taking any action under any Loan Document, except
\nfor actions which would require the consent of all Lenders under the
\nnext-to-last sentence of subsection (a) of Section 10.1. No Lender selling such
\na participation shall, as between the other parties hereto and such Lender, be
\nrelieved of any of its obligations hereunder as a result of the sale of such
\nparticipation. Each Lender<\/p>\n
47
\n 53<\/p>\n
which sells any such participation to any Person (other than an Affiliate of
\nsuch Lender) shall give prompt notice thereof to Agent and Borrower.<\/p>\n
(c) Except for sales of participations under the immediately preceding
\nsubsection (b), no Lender shall make any assignment or transfer of any kind of
\nits commitments or any of its rights under its Loans or under the Loan
\nDocuments, except for assignments to an Eligible Transferee, and then only if
\nsuch assignment is made in accordance with the following requirements:<\/p>\n
(i) Each such assignment shall apply to all Obligations owing to
\n the assignor Lender hereunder and to the unused portion of the assignor
\n Lender’s commitments, so that after such assignment is made the assignor
\n Lender shall have a fixed (and not a varying) Percentage Share in its
\n Loans and Note and be committed to make that Percentage Share of all
\n future Loans, the assignee shall have a fixed Percentage Share in such
\n Loans and Note and be committed to make that Percentage Share of all
\n future Loans, and the Percentage Share of the Commitment of both the
\n assignor and assignee shall equal or exceed $10,000,000.<\/p>\n
(ii) The parties to each such assignment shall execute and deliver
\n to Agent, for its acceptance and recording in the “Register” (as defined
\n below in this section), an Assignment and Acceptance in the form of
\n Exhibit E, appropriately completed, together with the Note subject to
\n such assignment and a processing fee payable to Agent of $2,500. Upon
\n such execution, delivery, and payment and upon the satisfaction of the
\n conditions set out in such Assignment and Acceptance, then (i) Borrower
\n shall issue new Notes to such assignor and assignee upon return of the
\n old Notes to Borrower, and (ii) as of the “Settlement Date” specified in
\n such Assignment and Acceptance the assignee thereunder shall be a party
\n hereto and a Lender hereunder and Agent shall thereupon deliver to
\n Borrower and each Lender a schedule showing the revised Percentage
\n Shares of such assignor Lender and such assignee Lender and the
\n Percentage Shares of all other Lenders.<\/p>\n
(iii) Each assignee Lender which is not a United States person (as
\n such term is defined in Section 7701(a)(30) of the Internal Revenue Code
\n of 1986, as amended) for Federal income tax purposes, shall (to the
\n extent it has not already done so) provide Agent and Borrower with the
\n “Prescribed Forms” referred to in Section 3.6(d).<\/p>\n
(d) Nothing contained in this section shall prevent or prohibit any
\nLender from assigning or pledging all or any portion of its Loans and Note to
\nany Federal Reserve Bank as collateral security pursuant to Regulation A of the
\nBoard of Governors of the Federal Reserve System and any Operating Circular
\nissued by such Federal Reserve Bank; provided that no such assignment or pledge
\nshall relieve such Lender from its obligations hereunder.<\/p>\n
(e) By executing and delivering an Assignment and Acceptance, each
\nassignee Lender thereunder will be confirming to and agreeing with Borrower,
\nAgents and each other<\/p>\n
48
\n 54<\/p>\n
Lender hereunder that such assignee understands and agrees to the terms hereof,
\nincluding Article IX hereof.<\/p>\n
(f) Agent shall maintain a copy of each Assignment and Acceptance and a
\nregister for the recordation of the names and addresses of Lenders and the
\nPercentage Shares of, and principal amount of the Loans owing to, each Lender
\nfrom time to time (in this section called the “Register”). The entries in the
\nRegister shall be conclusive, in the absence of manifest error, and Borrower and
\neach Bank Party may treat each Person whose name is recorded in the Register as
\na Lender hereunder for all purposes. The Register shall be available for
\ninspection by Borrower or any Bank Party at any reasonable time and from time to
\ntime upon reasonable prior notice.<\/p>\n
Section 10.6. Confidentiality. Each Bank Party agrees that it will take
\nall reasonable steps to keep confidential any proprietary information given to
\nit by any Restricted Person, provided, however, that this restriction shall not
\napply to information which (i) has at the time in question entered the public
\ndomain, (ii) is required to be disclosed by Law (whether valid or invalid) of
\nany Tribunal, (iii) is disclosed to any Bank Party’s Affiliates, auditors,
\nattorneys, or agents, (iv) is furnished to any other Bank Party or to any
\npurchaser or prospective purchaser of participations or other interests in any
\nLoan or Loan Document, or (v) is disclosed in the course of enforcing its rights
\nand remedies during the existence of an Event of Default.<\/p>\n
Section 10.7. Governing Law; Submission to Process. EXCEPT TO THE EXTENT
\nTHAT THE LAW OF ANOTHER JURISDICTION IS EXPRESSLY ELECTED IN A LOAN DOCUMENT,
\nTHE LOAN DOCUMENTS SHALL BE DEEMED CONTRACTS AND INSTRUMENTS MADE UNDER THE LAWS
\nOF THE STATE OF TEXAS AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH AND
\nGOVERNED BY THE LAWS OF THE STATE OF TEXAS AND THE LAWS OF THE UNITED STATES OF
\nAMERICA, WITHOUT REGARD TO PRINCIPLES OF CONFLICTS OF LAW. CHAPTER 15 OF TEXAS
\nREVISED CIVIL STATUTES ANNOTATED ARTICLE 5069 (WHICH REGULATES CERTAIN REVOLVING
\nCREDIT LOAN ACCOUNTS AND REVOLVING TRI-PARTY ACCOUNTS) DOES NOT APPLY TO THIS
\nAGREEMENT OR TO THE NOTES. BORROWER HEREBY IRREVOCABLY SUBMITS ITSELF AND EACH
\nOTHER RESTRICTED PERSON TO THE NON-EXCLUSIVE JURISDICTION OF THE STATE AND
\nFEDERAL COURTS SITTING IN THE STATE OF TEXAS AND AGREES AND CONSENTS THAT
\nSERVICE OF PROCESS MAY BE MADE UPON IT OR ANY RESTRICTED PERSON IN ANY LEGAL
\nPROCEEDING RELATING TO THE LOAN DOCUMENTS OR THE OBLIGATIONS BY ANY MEANS
\nALLOWED UNDER TEXAS OR FEDERAL LAW. ANY LEGAL PROCEEDING ARISING OUT OF OR IN
\nANY WAY RELATED TO ANY OF THE LOAN DOCUMENTS SHALL BE BROUGHT AND LITIGATED
\nEXCLUSIVELY IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF
\nTEXAS, DALLAS DIVISION, TO THE EXTENT IT HAS SUBJECT MATTER JURISDICTION, AND
\nOTHERWISE IN THE TEXAS<\/p>\n
49
\n 55<\/p>\n
DISTRICT COURTS SITTING IN DALLAS COUNTY, TEXAS. THE PARTIES HERETO HEREBY WAIVE
\nAND AGREE NOT TO ASSERT, BY WAY OF MOTION, AS A DEFENSE OR OTHERWISE, THAT ANY
\nSUCH PROCEEDING IS BROUGHT IN AN INCONVENIENT FORUM OR THAT THE VENUE THEREOF IS
\nIMPROPER, AND FURTHER AGREE TO A TRANSFER OF ANY SUCH PROCEEDING TO A FEDERAL
\nCOURT SITTING IN THE STATE OF TEXAS TO THE EXTENT THAT IT HAS SUBJECT MATTER
\nJURISDICTION, AND OTHERWISE TO A STATE COURT IN DALLAS, TEXAS. IN FURTHERANCE
\nTHEREOF, BORROWER AND BANK PARTIES EACH HEREBY ACKNOWLEDGE AND AGREE THAT IT WAS
\nNOT INCONVENIENT FOR THEM TO NEGOTIATE AND RECEIVE FUNDING OF THE TRANSACTIONS
\nCONTEMPLATED BY THIS AGREEMENT IN SUCH COUNTY AND THAT IT WILL BE NEITHER
\nINCONVENIENT NOR UNFAIR TO LITIGATE OR OTHERWISE RESOLVE ANY DISPUTES OR CLAIMS
\nIN A COURT SITTING IN SUCH COUNTY.<\/p>\n
Section 10.8. Limitation on Interest. Bank Parties, Restricted Persons
\nand any other parties to the Loan Documents intend to contract in strict
\ncompliance with applicable usury law from time to time in effect. In furtherance
\nthereof such Persons stipulate and agree that none of the terms and provisions
\ncontained in the Loan Documents shall ever be construed to create a contract to
\npay, for the use, forbearance or detention of money, interest in excess of the
\nmaximum amount of interest permitted to be charged by applicable law from time
\nto time in effect. Neither any Restricted Person nor any present or future
\nguarantors, endorsers, or other Persons hereafter becoming liable for payment of
\nany Obligation shall ever be liable for unearned interest thereon or shall ever
\nbe required to pay interest thereon in excess of the maximum amount that may be
\nlawfully charged under applicable law from time to time in effect, and the
\nprovisions of this section shall control over all other provisions of the Loan
\nDocuments which may be in conflict or apparent conflict herewith. Bank Parties
\nexpressly disavow any intention to charge or collect excessive unearned interest
\nor finance charges in the event the maturity of any Obligation is accelerated.
\nIf (a) the maturity of any Obligation is accelerated for any reason, (b) any
\nObligation is prepaid and as a result any amounts held to constitute interest
\nare determined to be in excess of the legal maximum, or (c) any Bank Party or
\nany other holder of any or all of the Obligations shall otherwise collect moneys
\nwhich are determined to constitute interest which would otherwise increase the
\ninterest on any or all of the Obligations to an amount in excess of that
\npermitted to be charged by applicable law then in effect, then all sums
\ndetermined to constitute interest in excess of such legal limit shall, without
\npenalty, be promptly applied to reduce the then outstanding principal of the
\nrelated Obligations or, at such Bank Party’s or holder’s option, promptly
\nreturned to Borrower or the other payor thereof upon such determination. In
\ndetermining whether or not the interest paid or payable, under any specific
\ncircumstance, exceeds the maximum amount permitted under applicable law, Bank
\nParties and Restricted Persons (and any other payors thereof) shall to the
\ngreatest extent permitted under applicable law, (i) characterize any
\nnon-principal payment as an expense, fee or premium rather than as interest,
\n(ii) exclude voluntary prepayments and the effects thereof, and (iii) amortize,
\nprorate, allocate, and spread the total amount of interest throughout the entire
\ncontemplated term of the instruments evidencing the Obligations in accordance
\nwith the amounts outstanding from<\/p>\n
50
\n 56<\/p>\n
time to time thereunder and the maximum legal rate of interest from time to time
\nin effect under applicable law in order to lawfully charge the maximum amount of
\ninterest permitted under applicable law. In the event applicable law provides
\nfor an interest ceiling, the ceiling shall be the “weekly ceiling” as defined in
\nSection 303 of the Texas Finance Code and Chapter 1D of Title 79, Tex. Rev. Civ.
\nStats. 1925, as amended and shall be used when appropriate in determining the
\nHighest Lawful Rate. As used in this section the term “applicable Law” means the
\nLaws of the State of Texas or the Laws of the United States of America,
\nwhichever Laws allow the greater interest, as such Laws now exist or may be
\nchanged or amended or come into effect in the future.<\/p>\n
Section 10.9. Termination; Limited Survival. In its sole and absolute
\ndiscretion Borrower may at any time that no Obligations are owing elect in a
\nwritten notice delivered to Agent to terminate this Agreement. Upon receipt by
\nAgent of such a notice, if no Obligations are then owing this Agreement and all
\nother Loan Documents shall thereupon be terminated and the parties thereto
\nreleased from all prospective obligations thereunder. Notwithstanding the
\nforegoing or anything herein to the contrary, any waivers or admissions made by
\nany Restricted Person in any Loan Document, any Obligations under Sections 3.2
\nthrough 3.6, and any obligations which any Person may have to indemnify or
\ncompensate any Bank Party shall survive any termination of this Agreement or any
\nother Loan Document. At the request and expense of Borrower, Agent shall prepare
\nand execute all necessary instruments to reflect and effect such termination of
\nthe Loan Documents. Agent is hereby authorized to execute all such instruments
\non behalf of all Lenders, without the joinder of or further action by any
\nLender.<\/p>\n
Section 10.10. Severability. If any term or provision of any Loan
\nDocument shall be determined to be illegal or unenforceable all other terms and
\nprovisions of the Loan Documents shall nevertheless remain effective and shall
\nbe enforced to the fullest extent permitted by applicable Law.<\/p>\n
Section 10.11. Counterparts. This Agreement may be separately executed
\nin any number of counterparts and by different parties hereto in separate
\ncounterparts, each of which when so executed shall be deemed to constitute one
\nand the same agreement.<\/p>\n
Section 10.12. Waiver of Jury Trial, Punitive Damages, etc.
\n BORROWER AND EACH BANK PARTY HEREBY KNOWINGLY, VOLUNTARILY,
\nINTENTIONALLY, AND IRREVOCABLY (A) WAIVES, TO THE MAXIMUM EXTENT NOT PROHIBITED
\nBY LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY LITIGATION
\nBASED HEREON, OR DIRECTLY OR INDIRECTLY AT ANY TIME ARISING OUT OF, UNDER OR IN
\nCONNECTION WITH THE LOAN DOCUMENTS OR ANY TRANSACTION CONTEMPLATED THEREBY OR
\nASSOCIATED THEREWITH, BEFORE OR AFTER MATURITY; (B) WAIVES, TO THE MAXIMUM
\nEXTENT NOT PROHIBITED BY LAW, ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY
\nSUCH LITIGATION ANY “SPECIAL DAMAGES”, AS DEFINED BELOW, (C) CERTIFIES THAT NO
\nPARTY HERETO NOR ANY REPRESENTATIVE OR AGENT OR COUNSEL FOR ANY PARTY HERETO HAS
\nREPRESENTED, EXPRESSLY OR<\/p>\n
51
\n 57<\/p>\n
OTHERWISE, OR IMPLIED THAT SUCH PARTY WOULD NOT, IN THE EVENT OF LITIGATION,
\nSEEK TO ENFORCE THE FOREGOING WAIVERS, AND (D) ACKNOWLEDGES THAT IT HAS BEEN
\nINDUCED TO ENTER INTO THIS AGREEMENT, THE OTHER LOAN DOCUMENTS AND THE
\nTRANSACTIONS CONTEMPLATED HEREBY AND THEREBY BY, AMONG OTHER THINGS, THE MUTUAL
\nWAIVERS AND CERTIFICATIONS CONTAINED IN THIS SECTION. AS USED IN THIS SECTION,
\n“SPECIAL DAMAGES” INCLUDES ALL SPECIAL, CONSEQUENTIAL, EXEMPLARY, OR PUNITIVE
\nDAMAGES (REGARDLESS OF HOW NAMED), BUT DOES NOT INCLUDE ANY PAYMENTS OR FUNDS
\nWHICH ANY PARTY HERETO HAS EXPRESSLY PROMISED TO PAY OR DELIVER TO ANY OTHER
\nPARTY HERETO.<\/p>\n
Section 10.13. Ratification of Agreements. This Agreement amends and
\nrestates in its entirety that certain Credit Agreement dated as of November 21,
\n1997, among Borrower, Agent and the lenders parties thereto, as supplemented or
\namended to the date hereof, together with the promissory notes made by Borrower
\nthereunder (collectively, the “Existing Credit Agreement”). Borrower hereby
\nagrees that (i) the Indebtedness outstanding under the Existing Credit Agreement
\nand all accrued and unpaid interest thereon and (ii) all accrued and unpaid fees
\nunder the Existing Credit Agreement shall be deemed to be outstanding under and
\ngoverned by this Agreement.<\/p>\n
[The remainder of this page is intentionally left blank]<\/p>\n
52
\n 58<\/p>\n
IN WITNESS WHEREOF, this Agreement is executed as of the date first
\nwritten above.<\/p>\n
STB SYSTEMS, INC.
\n Borrower<\/p>\n
By: \/s\/ BRYAN F. KEYES
\n ————————————
\n Name: Bryan F. Keyes
\n Title: Vice President<\/p>\n
Address:
\n STB Systems, Inc.
\n 3400 Waterview
\n Richardson, TX 75080
\n Attention: Bryan F. Keyes<\/p>\n
Telephone: (972) 234-8750
\n Telecopy: (972) 680-7153<\/p>\n
3DFX INTERACTIVE, INC.
\n Guarantor<\/p>\n
By: \/s\/ BRYAN F. KEYES
\n ————————————
\n Name: Bryan F. Keyes
\n Title: Vice President<\/p>\n
Address:
\n 3dfx Interactive, Inc.
\n c\/o STB Systems, Inc.
\n 3400 Waterview
\n Richardson, TX 75080
\n Attention: Bryan F. Keyes<\/p>\n
Telephone: (972) 234-8750
\n Telecopy: (972) 680-7153<\/p>\n
53
\n 59
\n BANK ONE, TEXAS, N.A.
\n Agent and Lender<\/p>\n
By: \/s\/ RICK ROGERS
\n ————————————
\n Name: Rick Rogers
\n Title: Managing Director<\/p>\n
Address:
\n 1717 Main Street
\n Dallas, Texas 75201
\n Attention: Richard L. Rogers<\/p>\n
Telephone: (214) 290-2305
\n Telecopy: (214) 290-2540<\/p>\n
COMERICA BANK-TEXAS
\n Lender<\/p>\n
By: \/s\/ ROBIN INGRAM
\n ————————————
\n Name: Robin Ingram
\n Title: Sr. Vice President<\/p>\n
Address:
\n Comerica Bank – Texas
\n 804 Congress Avenue, Suite 320
\n Austin, TX 78701
\n Attention: Robin Ingari<\/p>\n
Telephone: (512) 427-7119
\n Telecopy: (512) 427-7120<\/p>\n
54<\/p>\n","protected":false},"template":"","meta":{"_acf_changed":false,"_stopmodifiedupdate":true,"_modified_date":"","_cloudinary_featured_overwrite":false},"corporate_contracts_companies":[6538,8938],"corporate_contracts_industries":[9508],"corporate_contracts_types":[9561,9560],"class_list":["post-40883","corporate_contracts","type-corporate_contracts","status-publish","hentry","corporate_contracts_companies-3dfx-interactive-inc","corporate_contracts_companies-stb-systems-inc","corporate_contracts_industries-technology__hardware","corporate_contracts_types-finance__credit","corporate_contracts_types-finance"],"acf":[],"_links":{"self":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts\/40883","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts"}],"about":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/types\/corporate_contracts"}],"wp:attachment":[{"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/media?parent=40883"}],"wp:term":[{"taxonomy":"corporate_contracts_companies","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_companies?post=40883"},{"taxonomy":"corporate_contracts_industries","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_industries?post=40883"},{"taxonomy":"corporate_contracts_types","embeddable":true,"href":"https:\/\/corporate.findlaw.com\/legal-api\/wp-json\/wp\/v2\/corporate_contracts_types?post=40883"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}