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EXHIBIT 10.1
AGREEMENT TO AMEND
RECEIVABLES- AND INVENTORY-BACKED CREDIT LINES
THIS AGREEMENT TO AMEND RECEIVABLES- AND INVENTORY-BACKED CREDIT LINES
(this "Agreement") made and entered into as of August 13,1999 by and between
INTELECT COMMUNICATIONS, INC., a Delaware corporation ("ICI" or "Borrower"); and
THE COASTAL CORPORATION SECOND PENSION TRUST, a trust organized under the laws
of the State of Texas ("Lender") (the "Parties"):
W I T N E S S:
WHEREAS, Lender and Borrower entered into a LOAN AGREEMENT FOR
RECEIVABLES BACKED BORROWING dated September 14, 1998 as amended by Addendum
dated January 13, 1999, and Second Addendum dated July 16, 1999 (the
"Receivables Facility"); and
WHEREAS, Lender and Borrower entered into a LOAN AGREEMENT FOR
INVENTORY BACKED BORROWING dated November 24, 1998 as amended by Addendum dated
December 31, 1998 (the "Inventory Facility"); and
WHEREAS, Borrower has an existing line of credit with St. Xxxxx Capital
Partners, L.P. and SJMB, L.P. (collectively, "St Xxxxx"); and
WHEREAS, Borrower seeks additional debt funding for its working capital
requirements and is willing to issue Warrants for the acquisition of the Common
Stock of Borrower as further inducement for the issuance of this facility;
WHEREAS, Lender is willing to accept Common Stock of the Borrower in
partial payment of the debt under the Receivables and Inventory Facilities, as
amended and restated (the "Loan Agreement"); and
WHEREAS, Lender is willing to continue to loan funds to Borrower to
meet its current working capital requirements on a secured basis, including
security for the loan in (1) the pledge of the Pledged Securities; (2) a
collateral assignment of Accounts of the Designated Subsidiaries; and (3) a
secured interest in the Inventory of the Designated Subsidiaries, all as
provided herein and in a Security, Assignment and Pledge Agreement among Lender,
Borrower and its Designated Subsidiaries of even date herewith, and subject to
the Intercreditor Agreement with St. Xxxxx;
WHEREAS, Borrower and Lender desire to memorialize their intention to
combine and amend the Receivables Facility and the Inventory Facility, reduce
the current balance of the credit lines by the sale of Common Stock of the
Borrower to Lender and application of the proceeds to the loan balance, to
advance additional funds, and to issue and reprice warrants;
NOW, THEREFORE, for and in consideration of the premises, and the
mutual covenants and agreements herein contained, the Borrower and the Lender
agree as follows:
ARTICLE 1
GENERAL TERMS
Section 1.01 Definitions. The terms used herein shall have the meanings
given in the Loan Agreement.
ARTICLE 2
AMENDED TERMS OF TRANSACTION DOCUMENTS
Section 2.01 The Loan Agreement. Subject to the terms and conditions
and relying on the representations and warranties contained in this Agreement,
Borrower and Lender agree to the following:
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(a) Subject to the terms hereof, Borrower and Lender agree to
amend and restate the Receivables Facility and the Inventory Facility as a
single loan facility, to permit borrowing up to a total of eighty percent (80%)
of the Inventory and Eligible Accounts, to increase the credit line thereunder
to a total of Twelve Million Dollars ($12,000,000), based on the combined
lending base of Accounts and Inventory, and to extend the Maturity Date and
Termination Date to July 31, 2000. All other terms of the facilities shall
remain unchanged.
(b) The Notes currently outstanding shall be amended and
restated as a single instrument consistent with the Amended and Restated
Facility
Section 2.02 The Security Agreement.
(a) Subject to the terms hereof, Borrower and Lender agree to
amend and restate the Security Agreement for Receivables Backed Borrowing and
the Security Agreement for Inventory Backed Borrowing as a single agreement. The
Amended and Restated Security Agreement shall be an extension and renewal of the
existing recorded and perfected security interests of the Lender.
ARTICLE 3
REPAYMENT
Section 3.01 Debt Reduction. Borrower and Lender agree to convert Three
Million Dollars ($3,000,000) in Indebtedness under the Note and Loan Agreement
to Common Stock of the Borrower at the closing of this agreement, provided that
St. Xxxxx converts at least Two Million Dollars ($2,000,000) of Borrower's debt
at the same time.
Section 3.02 Shares Issued. Borrower shall issue to Lender 2,777,778
shares of Common Stock in repayment of Three Million Dollars ($3,000,000) in
principal under the Advances (the "Repayment Shares").
ARTICLE 4
WARRANTS
Section 4.01 Warrants. As an inducement to enter this Agreement, but
for which Lender would not do, Borrower agrees to issue to Lender Warrants to
purchase 1,067,308 shares of Common Stock at a price per share of ONE AND 30/100
DOLLARS ($1.30). Borrower agrees to issue a Warrant in the form of Exhibit A.
Section 4.02 Reissued Warrants. As a further inducement, Borrower
agrees to reissue to Lender the Warrants issued on August 27, 1997 at an
exercise price per share of Six Dollars ($6.00). The exercise price shall be the
same as for the Warrants issued under section 4.01, and the number of Warrants
shall be adjusted for dilution as specified in the Warrant. (The Warrants issued
under section 4.01 and 4.02 are referred to herein collectively as the
"Warrants").
Section 4.03 Registration Rights. Borrower further agrees to register
the resale of the shares of Common Stock to be issued in accordance with Article
3 in accordance with the Registration Rights Agreement attached hereto as
Exhibit B, provided that the registration statement shall be filed with the
Securities and Exchange Commission not later than ten (10) days following the
Effective Date, and Borrower shall seek to make the registration effective
within sixty (60) days of filing.
ARTICLE 5
REPRESENTATIONS AND WARRANTIES
In order to induce the Lender to enter into the Note and Agreement,
Borrower represents and warrants to the Lender (which representations and
warranties shall survive the closing) that:
Section 5.01 Organization. Borrower is a corporation duly existing and
in good standing under the laws of the State of Delaware. Each of the Borrower
and its Material Subsidiaries is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation or formation,
has all requisite corporate power and authority to own its Property and to carry
on its business as now conducted, and is in good standing and authorized to do
business in each jurisdiction in which the Borrower or such Material Subsidiary
owns real Property or conducts such business, where the failure to maintain such
good standing or authorization is reasonably expected to have a Material Adverse
Effect.
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Section 5.02 Authorization; No Conflict. The execution and delivery of
this Agreement, the execution and delivery of the Note and the performance by
the Borrower of its obligations under this Agreement, the Loan Agreement and the
Note are within the Borrower's corporate powers, have been duly authorized by
all necessary corporate action, have received all necessary governmental
approvals (if any shall be required) and do not and will not contravene or
conflict with any rule, regulation, decree or order or provision of law or of
the charter or by-laws of the Borrower or of any material agreement binding upon
the Borrower or any of its properties, except to the extent any such consent or
approval has been obtained or waived, and delivered to Lender.
Section 5.03 Binding Obligations. This Agreement constitutes the legal
valid and binding obligation of the Borrower, enforceable in accordance with its
terms, except to the extent that the enforceability thereof may be limited by
bankruptcy, insolvency or other similar laws affecting creditors' rights
generally or under general principles of equity.
Section 5.04 Defaults. Except as disclosed to the Lender, neither the
Borrower nor any Subsidiary is in Default in any respect which has or would have
a Materially Adverse Effect on the consolidated business, Property, operations
or financial condition of the Borrower and its Consolidated Subsidiaries under
any instrument evidencing borrowed money to which the Borrower or a Subsidiary
is a party or by which it is bound.
Section 5.05 Outstanding Common Stock. As of August 10, 1999, there
were 48,885,278 shares of Common Stock outstanding, including 191,435 shares in
treasury.
ARTICLE 6
REPRESENTATIONS AND WARRANTIES OF LENDER
Section 6.01 Lender hereby represents and warrants to the Company as
follows:
(a) Organizational Status; Authority; Enforceability; No
conflicts; etc. Lender is a trust, duly formed under the laws of the State of
Texas, and has all requisite power and authority to enter into and perform its
obligations under this Agreement. The execution and delivery of this Agreement
and the consummation of the transactions hereunder have been duly authorized by
all required action. This Agreement has been duly executed and delivered on
behalf of Lender and is a legal, valid and binding obligation, enforceable in
accordance with its terms, subject to applicable bankruptcy and insolvency laws
and general principles of equity. This Agreement does not conflict with any of
Lender's organizational documents or partnership agreement, or any other
contract or agreement to which it is a party, or any law, rule or regulation
binding on or applicable to Lender.
(b) Investment Intent. Lender is acquiring the Repayment
Shares, the Warrants and the share of Common Stock issuable upon exercise of the
Warrants (the "Warrant Shares") for its own account for investment only and not
with a view towards, or for resale in connection with, the public sale or
distribution thereof, except pursuant to sales registered or exempted under the
Securities Act; provided, however, that by making the representations herein, it
does not agree to hold any of the Repayment Shares or Warrant Shares for any
minimum or other specific term and reserves the right to dispose of the
Repayment Shares or Warrant Shares at any time in accordance with or pursuant to
a registration statement or an exemption under the Securities Act, except as
otherwise provided in this Agreement.
(c) Accredited Investor Status. Lender is an "accredited
investor" as that term is defined in Rule 501(a) of Regulation D promulgated
under the Securities Act.
(d) Reliance on Exemptions. Lender understands that the
Repayment Shares, the Warrants and the Warrant Shares are being issued to it in
reliance on specific exemptions from the registration requirements of United
States federal and state securities laws and that the Company is relying in part
upon the truth and accuracy of, and Lender's compliance with, the
representations and warranties of Lender in order to determine the availability
of such exemptions and the eligibility of Lender to acquire the Repayment
Shares, the Warrants and the Warrant Shares.
(e) Information. Lender and its advisors, if any, have been
afforded the opportunity to ask questions of the Company, including its
management. Lender has sought such accounting, legal and tax advice as it has
considered necessary to make an informed investment decision with respect to its
acquisition of the Repayment Shares, the Warrants and the Warrant Shares. Lender
acknowledges that:
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(i) it has access to copies of (and acknowledges that
the Company has offered to provide, upon its request, copies
of) the Company's filings with the Securities Exchange
Commission (collectively, the "Public Documents");
(ii) it understands that the acquisition of Common
Stock entails various risks including, but not limited to,
those outlined in the Public Documents and in this Agreement,
and has determined that the Repayment Shares and the Warrants
are a suitable investment and that at this time it could bear
a complete loss of its investment; and
(iii) any information which Lender has heretofore
represented or furnished to the Company with respect to its
financial sophistication is correct and complete as of the
date of this Agreement.
(g) No Governmental Review. Lender understands that no United
States federal or state agency or any other government or governmental agency
has passed on or made any recommendation or endorsement of the Repayment Shares,
the Warrants or the Warrant Shares or the fairness or suitability of the
investment in the Repayment Shares, the Warrants or the Warrant Shares nor have
such authorities passed upon or endorsed the merits of the offering.
(h) Transfer or Resale. Lender understands that except as
provided herein: (i) the Repayment Shares, the Warrants and the Warrant Shares
have not been registered under the Securities Act or any state securities laws,
and may not be offered for sale, sold, assigned or transferred unless (A)
subsequently registered, (B) Lender shall have delivered to the Company an
opinion of counsel, in a generally acceptable form, to the effect that the
Repayment Shares, the Warrants and the Warrant Shares to be sold, assigned or
transferred may be sold, assigned or transferred pursuant to an exemption from
such registration, or (C) Lender provides the Company with reasonable assurance
that such Repayment Shares, the Warrants or the Warrant Shares can be sold,
assigned or transferred pursuant to Rule 144 promulgated under the Securities
Act, as amended (or a successor rule thereto)("Rule 144"); and (ii) any sale of
the Repayment Shares, the Warrants or the Warrant Shares made in reliance on
Rule 144 may be made only in accordance with the terms of Rule 144 and further,
if Rule 144 is not applicable, any resale of the Repayment Shares, the Warrants
or the Warrant Shares under circumstances in which the seller (or the person
through whom the sale is made) may be deemed to be an underwriter (as that term
is defined in the Securities Act) may require compliance with some other
exemption under the Securities Act or the rules and regulations of the SEC
thereunder; and (iii) except as expressly provided in this Agreement or the
Registration Rights Agreement, neither the Company nor any other person is under
any obligation to register such shares under the Securities Act or any state
securities laws or to comply with the terms and conditions of any exemption
thereunder.
Section 6.02 Lender acknowledges that the Repayment Shares, the
Warrants and the Warrant Shares shall be issued with the following restrictive
legend:
THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED
UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR ANY STATE SECURITIES
LAW (COLLECTIVELY, THE "ACTS"). THE SECURITIES HAVE BEEN ACQUIRED FOR
INVESTMENT AND MAY NOT BE OFFERED, SOLD, TRANSFERRED, PLEDGED OR
OTHERWISE DISPOSED OF UNLESS AND UNTIL (1) SUCH SECURITIES HAVE BEEN
REGISTERED UNDER THE ACTS OR (2) THE HOLDER OF SUCH SECURITIES PROVIDES
THE COMPANY WITH (a) AN UNQUALIFIED WRITTEN OPINION OF LEGAL COUNSEL,
WHICH COUNSEL AND OPINION (IN FORM AND SUBSTANCE) SHALL BE REASONABLY
SATISFACTORY TO THE COMPANY, TO THE EFFECT THAT THE PROPOSED
DISPOSITION OF SUCH SECURITIES MAY BE EFFECTED WITHOUT REGISTRATION
UNDER THE ACTS OR (b) SUCH OTHER EVIDENCE AS MAY BE REASONABLY
SATISFACTORY TO THE COMPANY THAT THE PROPOSED DISPOSITION OF SUCH
SECURITIES MAY BE EFFECTED WITHOUT REGISTRATION UNDER THE ACTS.
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ARTICLE 7
COVENANTS
Until the expiration or termination of this Agreement and thereafter
until all obligations of the Borrower under the Transaction Documents are
performed or paid in full, without the consent of the Lender, the Borrower will
not:
Section 7.01 Restrictions on Borrowing. So long as the Indebtedness is
outstanding, except for obligations of the Borrower outstanding on the date
hereof, and extensions thereof, Borrower shall not, nor permit any Subsidiary
to, create, incur, assume or suffer to exist any liability for borrowed money
without the consent of Lender, which consent shall not be unreasonably withheld.
Borrower will not enter into or become subject to, and will not permit any of
its Material Subsidiaries to enter into or become subject to, any agreement
(other than this Agreement or other agreements in existence on the date hereof
disclosed to Lender) that prohibits or otherwise restricts the right of such
Borrower or its Material Subsidiaries to create, incur, assume or suffer to
exist any Lien in favor of the Lender on any of such Borrower's, or any of its
Material Subsidiaries', assets.
Section 7.02 Payment of Dividends. Borrower shall not declare or pay
any dividend or make any distribution on its Capital Stock or to the holders of
its Capital Stock (other than (i) dividends or distributions payable in its
Capital Stock, (ii) dividends or distributions of a right, junior preferred
stock or other similar security in connection with a shareholder rights plan, to
the extent that such rights, junior preferred stock or security attach equally
to all shares of the Borrower's Common Stock, and (iii) dividends on its
Preferred Stock other than mandatory redemption Preferred Stock of the Borrower)
or purchase, redeem or otherwise acquire or retire for value, or permit any
Subsidiary to purchase or otherwise acquire for value, any such Capital Stock if
at the time of such action any Loan under this Agreement is outstanding;
provided, however that Borrower shall be permitted to repurchase or redeem any
of its preferred stock now or hereafter outstanding.
Section 7.03 Registration. Borrower shall file a registration statement
for the Common Stock issued in accordance with this Agreement, including the
Common Stock to be issued on exercise of the Warrants, with the Securities and
Exchange Commission not later than ten (10) days following the Effective Date,
and Borrower shall seek to make the registration effective within sixty (60)
days of filing.
ARTICLE 8
EVENTS OF DEFAULT
Section 8.01 Events of Default. Any of the following Default events
shall each be considered an "Event of Default" as that term is used herein:
(a) Default on Other Debt. The Borrower or any Subsidiary
fails to make payment when due on any indebtedness for borrowed money in an
aggregate principal amount in excess of One Hundred Thousand Dollars ($100,000)
at the time outstanding (after giving effect to any applicable grace periods);
or any default shall occur with respect to any such indebtedness, or under any
agreement securing or relating to such indebtedness, the effect of which is to
cause or to permit any holder of such indebtedness or a trustee to cause
(whether or not such holder or trustee elects to cause) such indebtedness, or
portion thereof, to become due prior to its stated maturity or prior to its
regularly scheduled dates of payment and such Default remains uncured for a
period of thirty (30) days; or
(b) Non-Payment of Indebtedness. Default is made in the
payment or prepayment when due of any Indebtedness and such Default continues
for a period in excess of five (5) days; or
(c) Representations and Warranties. Any representation or
warranty made by the Borrower in this Agreement proves to have been incorrect in
any material respect as of the date hereof; or any representation, statement
(including Financial Statements), certificate or data furnished or made by the
Borrower under this Agreement, proves to have been untrue in any material
respect, as of the date as of which the facts therein set forth were stated and
which in either such case may constitute a Material Adverse Effect; or
(d) Covenants. Default is made in the due observance or
performance of any of the covenants or agreements contained in this Agreement to
be kept or performed by the Borrower and such Default continues unremedied for a
period of thirty (30) days after the earlier of (i) notice thereof being given
by the Lender to the Borrower, or (ii) such Default otherwise becoming known to
the Borrower, where such Default would have a Material Adverse Effect; or
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(e) Involuntary Bankruptcy or Receivership Proceedings. A
custodian, receiver, conservator, liquidator or trustee of the Borrower or any
Material Subsidiary or of any Property thereof is appointed by the order or
decree of any court or agency or supervisory authority having jurisdiction, and
such decree or order remains unstayed for more than sixty (60) days; or the
Borrower or any Material Subsidiary is adjudicated bankrupt or insolvent and
such order or decree remains unstayed for more than sixty (60) days; or any
Property of the Borrower or any Material Subsidiary is sequestered by court
order; or a petition is filed against the Borrower or any Material Subsidiary
under any state or federal bankruptcy, reorganization, arrangement, insolvency,
readjustment of debt, dissolution, liquidation or receivership law of any
jurisdiction, whether now or hereafter in effect, and is not stayed or dismissed
within sixty (60) days after such filing; or
(f) Voluntary Petitions. The Borrower or any Material
Subsidiary files a petition in bankruptcy or seeks relief under any provision of
any bankruptcy, reorganization, arrangement, insolvency, readjustment of debt,
dissolution or liquidation law of any jurisdiction, or consents to the filing of
any such petition under any such law; or
(g) Assignments for Benefit of Creditors, Etc. The Borrower or
any Material Subsidiary makes an assignment for the benefit of its creditors, or
admits its inability to pay its debts as they become due, or consents to the
appointment of a receiver, custodian, trustee or liquidator of the Borrower or
any Material Subsidiary or of all or any part of its respective Property; or
(h) Discontinuance of Business. The Borrower, Intelect Network
Technologies Company , DNA Enterprises, Inc., or Intelect Visual Communications
Corp. discontinues its business; or
(i) ERISA Default. A Plan fails to maintain the qualifications
for any Plan required by ERISA, and there shall result from any such event or
events either liability or a material risk of incurring liability to the PBGC or
to a Plan, which would have a Material Adverse Effect; or
(j) Cross Default. Borrower is in Default under any of the
other Transaction Documents.
Section 8.02 Remedies. Upon the happening of any Event of Default
specified in Section 7.01 hereof, the Lender may by written notice to the
Borrower declare (i) all Loans then outstanding to be immediately due and
payable without presentment, demand, protest, notice of protest, or dishonor or
other notice of Default of any kind, all of which are hereby expressly waived by
the Borrower, and/or (ii) all obligations, if any, of the Lender hereunder to be
immediately terminated.
Section 8.03 Right of Set-Off. Upon the occurrence and during the
continuance of any Event of Default the Lender is hereby authorized at any time
and from time to time, without notice to the Borrower (any such notice being
expressly waived by the Borrower), to set-off and apply any and all deposits
(general or special, time or demand, provisional or final) at any time held and
other Indebtedness at any time owing by the Lender to or for the credit or the
account of the Borrower against any and all of the Indebtedness of the Borrower,
irrespective of whether the Lender shall have made any demand under this
Agreement or the Note and although such obligations may be unmatured. The Lender
agrees promptly to notify the Borrower after any such set-off and application,
provided that the failure to give such notice shall not affect the validity of
such set-off and application. In addition, the Lender recognizes and agrees, and
any other holder of the Note by acceptance hereof shall be deemed to agree, that
any and all balances, credits, deposits, accounts or moneys of the Borrower now
or hereafter with the Lender or other holder shall, at the direction of the
Borrower, be applied to the payment and prepayment of any obligation of the
Borrower to the Lender or other holder hereunder.
ARTICLE 9
MISCELLANEOUS
Section 9.01 Notices. Except as otherwise specified herein, all
notices, requests, demands or other communications to or upon the respective
Parties hereto shall be deemed to have been duly given or made when delivered to
the party to which such notice, request, demand or other communication is
required or permitted to be given or made under this Agreement or the Note,
addressed to such party at its address set forth below or at such other address
as either of the Parties hereto may hereafter notify the other in writing.
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To Borrower: INTELECT COMMUNICATIONS, INC.
0000 Xxxxxxxxx Xxxxx
Xxxxxxxxxx, Xxxxx 00000
Telephone: 000-000-0000
Telecopy: 000-000-0000
Attention: Xxxxxx Xxxxxxxx, Chairman and CEO
with a copy to: XXXX & SUDAN, L.L.P.
000 Xxxxxx, 00xx Xxxxx
Xxxxxxx, Xxxxx 00000
Telephone: 000-000-0000
Telecopy: 000-000-0000
Attention: Xxxxxx X. Sudan, Jr., Esq.
To Lender: THE COASTAL CORPORATION SECOND PENSION TRUST
Nine Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxx 00000-0000
Telephone: 000-000-0000
Telecopy: 000-000-0000
Attention: Xxxxxx X. Xxxxxxxxx, Trustee
with a copy to: THE COASTAL CORPORATION
Nine Xxxxxxxx Xxxxx
Xxxxxxx, Xxxxx 00000-0000
Telephone: 000-000-0000
Telecopy: 000-000-0000
Attention: Director, Financial Administration
Section 9.02 Benefit of Agreement. This Agreement shall be binding upon
and inure to the benefit of and be enforceable by the respective successors and
assigns of the Parties hereto; provided, however, the Borrower may not assign or
transfer any of its interest hereunder without the prior written consent of the
Lender and provided further that the Lender may not assign the Note or its
interest hereunder without the prior written consent of the Borrower, which
consent of either party shall not be withheld unreasonably.
Section 9.03 Survival of Representations. All representations and
warranties of the Borrower herein shall survive the effective date of this
Agreement.
Section 9.04 Renewal, Extension or Rearrangement. All provisions of
this Agreement relating to the Note shall apply with equal force and effect to
each and all promissory notes hereinafter executed which in whole or in part
represent a renewal, extension for any period, increase or rearrangement of the
Note.
Section 9.05 Invalidity. In the event that any one or more of the
provisions contained in the Note or this Agreement shall, for any reason, be
held invalid, illegal or unenforceable in any respect, such invalidity,
illegality or unenforceability shall not affect any other provision of the Note
or this Agreement.
Section 9.06 Amendment or Waiver. This Agreement may not be amended,
changed, waived, discharged or terminated without the written consent of the
Borrower and the Lender.
Section 9.07 No Waiver; Remedies Cumulative. No failure or delay on the
part of the Borrower or the Lender in exercising any right, power or privilege
hereunder and no course of dealing between the Borrower and the Lender shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right, power or privilege hereunder or under the Note preclude any other or
further exercise thereof or the exercise of any other right, power or privilege
hereunder. The rights and remedies herein expressly provided are cumulative and
not exclusive of any rights or remedies which the Borrower or the Lender would
otherwise have.
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Section 9.08 Interest. It is the intention of the Parties hereto to
conform strictly to applicable usury laws as presently in effect. Accordingly,
if the transactions contemplated hereby would be usurious under applicable law
(including the laws of the United States of America and the law of any
jurisdiction whose laws are mandatorily applicable), then, in that event,
notwithstanding anything to the contrary in the Note or this Agreement, it is
agreed as follows: (i) the aggregate of all consideration which constitutes
interest under applicable law that is contracted for, charged or received under
the Note or this Agreement or under any other agreements or otherwise in
connection with the Note shall under no circumstances exceed the Highest Lawful
Rate, and any excess shall be credited on the Note by the holder thereof (or, if
the Note shall have been paid in full, refunded to the Borrower); and (ii) in
the event that the maturity of the Note is accelerated by reason of an election
of the Holder thereof resulting from any Event of Default under this Agreement
or otherwise, or in the event of any required or permitted prepayment, then such
consideration that constitutes interest may never include more than otherwise
would be calculated at the Highest Lawful Rate, and excess interest, if any,
provided for in this Agreement or otherwise shall be canceled automatically as
of the date of such acceleration or prepayment and, if theretofore paid, shall
be credited on the Note (or, if the Note shall have been paid in full, refunded
to the Borrower).
Section 9.09 Headings. The descriptive headings of this Agreement are
inserted for convenience only and shall not in any way affect the meaning or
construction of any provision of this Agreement.
Section 9.10 Counterparts. This Agreement may be executed in any number
of counterparts and by the different Parties hereto on separate counterparts,
each of which when so executed and delivered shall be an original, but all of
which shall together constitute one and the same instrument. A complete set of
counterparts shall be lodged with the Borrower and the Lender.
Section 9.11 Governing Law. THIS AGREEMENT, AND THE APPLICATION OR
INTERPRETATION THEREOF, SHALL BE GOVERNED EXCLUSIVELY BY ITS TERMS AND BY THE
LOCAL, INTERNAL LAW OF THE STATE OF TEXAS, U.S.A., EXCEPT TO THE EXTENT THE
CONFLICTS OF LAWS RULES OF THE STATE OF TEXAS WOULD REQUIRE THE APPLICATION OF
THE LAW OF ANOTHER JURISDICTION IN WHICH CASE THE LAWS OF THE STATE OF TEXAS
SHALL NONETHELESS APPLY. THE PARTIES CONSENT TO JURISDICTION IN THE STATE AND
FEDERAL COURTS LOCATED IN THE COUNTY OF XXXXXX, STATE OF TEXAS, U.S.A.
Section 9.12 Entire Agreement. This Agreement, including the Exhibits
attached hereto and the documents delivered pursuant hereto, constitutes the
entire agreement between the Parties with respect to the subject matter of this
Agreement and supersedes all previous communications, representations,
understandings, and agreements, either oral or written, between the Parties with
respect to the subject matter.
THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS TO WHICH ANY OF THE MAKERS OR ANY OF
THEIR RESPECTIVE SUBSIDIARIES IS A PARTY CONSTITUTE A "LOAN AGREEMENT" AS
DEFINED IN SECTION 26.02(A) OF THE TEXAS BUSINESS AND COMMERCE CODE, AND
REPRESENT THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY
EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
THERE ARE NO ORAL AGREEMENTS BETWEEN THE PARTIES.
IN WITNESS WHEREOF, the Parties have caused this instrument to be
executed as of the date first above written.
INTELECT COMMUNICATIONS, INC. THE COASTAL CORPORATION SECOND
PENSION TRUST
By: By:
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Xxxxxx X. Xxxxxxxx Xxxxxx X. Xxxxxxxxx
Chairman & CEO Senior Vice President
The Coastal Corporation
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LOAN AGREEMENT
EXHIBIT A
WARRANT
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LOAN AGREEMENT
EXHIBIT B
REGISTRATION RIGHTS AGREEMENT
