LEASE SCHEDULE NO. 1000063259 dated as of October 31, 1997 LEASE
(New Equipment)
Master Lease Agreement dated 10/30/96
Lessor: Banc One Leasing Corporation
Lessee: STB Systems, Inc.
1. GENERAL. This Lease Schedule is signed and delivered under the Master Lease
Agreement identified above, as amended from time to time ("Master Lease"),
between Lessee and Lessor. Capitalized terms defined in the Master Lease will
have the same meanings when used in this Schedule.
2. LEASE; EQUIPMENT DESCRIPTION. Lessor leases to Lessee, and Lessee leases
from Lessor, all of the property ("Equipment") described in Schedule A-l
attached hereto (and Lessee represents that all Equipment is NEW unless
specifically identified as used) on Schedule A-1.
3. LESSOR'S COST OF EQUIPMENT.
Equipment Cost to Lessor: $3,201,726.26
Set-Up/Filing Fee: $ 375.00
Miscellaneous: $ 0.00
Sales Tax: $ 0.00
Lessor's Cost (total): $3,202,101.26
4. LEASE TERM. The Lease Term of this Schedule shall be SIXTY (60) MONTHS and
shall commence on NOVEMBER 1,1997 ("Commencement Date").
5. RENT/FEES. There shall be added to each rent or other payment described
below all applicable Taxes as in effect from time to time.
(a) As rent for the Equipment during the Lease Term, Lessee shall pay to
Lessor MONTHLY rent will each such periodic rent payment being in the amount of
$60,775.02. The first rent payment in the Lease Term shall be paid in ARREARS
and all subsequent rent payments shall be paid on the same day of each MONTH
thereafter.
(b) Lessee shall pay Lessor a Set-Up/Filing Fee of $375.00 which has been
included in the above Lessor's Cost of the Equipment.
(c) Security Deposit: $ ZERO On the Acceptance Date, Lessee shall pay Lessor
said Security Deposit which shall be held in accordance with paragraph 11 below.
6. RENT ADJUSTMENT. Within 15 days after each scheduled Rent Payment Date
in the Lease Term, Lessor shall calculate the Payment Adjustment for such
Rent Payment Date (the "Adjustment Date"). With the next scheduled Rent
Payment in the Lease Term (or within 15 days after the last scheduled Rent
Payment in the Lease Term) (a) if on the Adjustment Date the Adjusted Rate is
greater than the Initial Rate, then Lessee shall pay to Lessor the Payment
Adjustment, or (b) if on the Adjustment Date the Adjusted Rate is less than
the Initial Rate, then Lessor shall pay to
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Lessee the Payment Adjustment (which amount may be credited by Lessee toward the
Rent Payment then due). For the purposes of this paragraph, the following terms
shall have the following meanings:
(a) "Adjustment Date" shall mean the scheduled Rent Payment Date in the
Lease Term for which the Payment Adjustment is being calculated.
(b) "Adjusted Rate" shall mean LIBOR plus 250 basis points as of the
Adjustment Date.
(c) "Contract Receivable" shall mean the remaining principal outstanding
just prior to application of the Rent Payment due on the Adjustment Date,
as shown on the books and records of the Lessor.
(d) "Initial Rate" shall mean 8.1250%.
(e) "LIBOR" shall mean the one month rate of interest at which deposits in
U.S. dollars are offered to major banks in the London Interbank market as
published in the Wall Street Journal on the Adjustment Date.
(f) "Payment Adjustment" shall mean the Rate Differential multiplied by the
Contract Receivable.
(g) "Rate Differential" shall mean the absolute value of the difference
between the Initial Rate and the Adjusted Rate.
7. TITLE TO EQUIPMENT; QUIET POSSESSION. Xxxxxx agrees that Lessor is the
lawful owner of the Equipment and that good and marketable title to the
Equipment shall remain with Lessor at all times. Lessee at its sole expense will
protect and defend Xxxxxx's good and marketable title to the Equipment against
all claims and demands whatsoever except for Liens created directly by Xxxxxx.
Lessee shall have no right, title or interest in any of the Equipment except the
right to peacefully and quietly hold and use the Equipment in accordance with
the terms of the Lease during the Lease Term unless and until an event of
default shall occur.
8. LESSEE'S ASSURANCES. Lessee irrevocably and unconditionally: (a) reaffirms
all of the terms and conditions of the Master Lease and agrees that the Master
Lease remains in full force and effect; (b) agrees that the Equipment is and
will be used at all times solely for commercial purposes, and not for personal,
family or household purposes; and (c) incorporates all of the terms and
conditions of the Master Lease as if fully set forth in this Schedule.
9. CONDITIONS. No lease of Equipment under this Schedule shall be binding on
Lessor, and Lessor have no obligation to purchase the Equipment covered hereby,
unless: (a) Lessor has received evidence of all required insurance; (b) in
Lessor's sole judgment, there has been no material adverse change in the
financial condition or business of Lessee or any guarantor; (c) Lessee has
signed and delivered to Lessor this Schedule, which must be satisfactory to
Lessor, and Lessor has signed and accepted this Schedule; (d) no change in the
Code or any regulation thereunder, which in Lessor's sole judgment would
adversely affect the economics to Lessor of the lease transaction, shall have
occurred or shall appear to be imminent; (e) Lessor has received, in form and
substance satisfactory to Lessor, such other documents and information as Lessor
shall reasonably request (including, without limitation, Political Risk
Insurance described below in this Schedule); (f) STB DE MEXICO, S.A. DE C. V.
shall execute and deliver to Lessor a guaranty which must be satisfactory in
form and substance to Lessor (such satisfaction to be evidenced by Xxxxxx's
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signature thereon) and (g) Lessee has satisfied all other reasonable conditions
established by Xxxxxx. Notwithstanding anything to the contrary above in this
paragraph, if Lessor executes and delivers the Schedule to Lessee and if Lessor
pays all of the suppliers of the Equipment the full Lessor's Cost of the
Equipment (the date as of which both of said events shall have occurred will be
called the "Funding Date"), then except as otherwise specified in writing by
Lessor to Lessee before said Funding Date, all conditions to the Schedule being
binding on Lessor will be deemed satisfied.
10. OTHER DOCUMENTS; EXPENSES: Xxxxxx agrees to sign and deliver to Lessor any
additional documents deemed desirable by Lessor to effect the terms of the
Master Lease or this Schedule including, without limitation, Uniform Commercial
Code financing statements which Lessor is authorized to file with the
appropriate filing officers. Lessee hereby irrevocably appoints Lessor as
Xxxxxx's attorney-in-fact with full power and authority in the place of Lessee
and in the name of Lessee to prepare, sign, amend, file or record any Uniform
Commercial Code financing statements or other documents deemed desirable by
Lessor to perfect, establish or give notice of Lessor's interests in the
Equipment or in any collateral as to which Lessee has granted Lessor a security
interest. Lessee shall pay upon Xxxxxx's written request any actual
out-of-pocket costs and expenses paid or incurred by Lessor in connection with
the above terms of this section or the funding and closing of this Schedule.
11. SECURITY DEPOSIT: As collateral for Lessee's obligations under the Lease,
Lessee hereby grants to Lessor a security interest in the sums specified in this
Schedule as a "Security Deposit". At its option, Lessor may apply all or any
part of said Security Deposit to cure any default of Lessee under the Lease. If
upon final termination of this Schedule, Xxxxxx has fulfilled all of the terms
and conditions hereof, then Lessor shall pay to Lessee upon Xxxxxx's written
request any remaining balance of the Security Deposit for this Schedule, without
interest.
12. REPRESENTATIONS AND WARRANTIES: Lessee represents and warrants that: (a)
Lessee is a corporation duly organized, validly existing and in good standing
under the laws of the state of its organization; (b) Lessee has full power,
authority and legal right to sign, deliver and perform the Master Lease, this
Schedule and all related documents and such actions have been duly authorized by
all necessary corporate action; and (c) the Master Lease, this Schedule and each
related document has been duly signed and delivered by Xxxxxx and each such
document constitutes a legal, valid and binding obligation of Lessee enforceable
in accordance with its terms, except to the extent enforcement is limited by
State and Federal laws regarding bankruptcy, insolvency or debt reorganization
or other similar laws of general application or the application of principles of
equity.
13. SUBLEASE. Notwithstanding anything to the contrary in the Master Lease,
with respect to this Schedule, Lessor consents to the sublease or bailment of
the Equipment described in this Schedule by Lessee as sublessor or xxxxxx to STB
DE MEXICO, S.A. DE C. V. as sublessee or bailee pursuant to the terms and
conditions of a Gratuitous Bailment Agreement and to the location of the
Equipment covered by the Schedule in the City of Ciudad Xxxxxx, State of
Chihuahua, Mexico; provided, that the Gratuitous Bailment Agreement must be
satisfactory in form and substance to Lessor (such satisfaction to be evidenced
by Xxxxxx's signature thereon).
14. POLITICAL RISK INSURANCE. As used herein, "Political Risk Insurance"
shall mean a policy of insurance issued by National Union Fire Insurance Company
of Pittsburgh, PA ("Insurance Company") which insures Lessee and Lessor (or
Lessor's assignee) against risks of expropriation or deprivation of the
Equipment by the government of the United Mexican States ("Political Loss") as
set forth in such policy of insurance. Xxxxxx acknowledges that it has reviewed
a copy of the Political Risk Insurance policy.
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(a) With respect to this Schedule, Lessee shall be required to carry
Political Risk Insurance as an additional requirement under Section 8 of
the Master Lease and Lessee shall pay the premiums for the Political Risk
Insurance that Lessor requires hereunder.
(b) If a Political Loss occurs, such event shall be deemed a Casualty Loss
under Section 9 of the Master Lease; provided, that (1) Lessee agrees to
continue to pay rent and perform its other obligations under this Schedule
and the Master Lease until the earlier of the date that the Insurance
Company pays the amounts due under the Political Risk Insurance or the date
that Lessor has exhausted its rights and remedies under the Political Risk
Insurance; (2) Lessor agrees that it will pursue with reasonable diligence
its rights against the Insurance Company under the Political Risk
Insurance; and (3) notwithstanding anything to the contrary in Section 9 of
the Master Lease as it relates to this Schedule, within thirty (30) days of
the earlier of the date that the Insurance Company pays the amounts due
under the Political Risk Insurance or the date that Lessor has exhausted
its rights and remedies under the Political Risk Insurance, Lessee shall
pay to Lessor the Stipulated Loss Value of the Equipment affected by the
Political Loss less the aggregate of the amount that the Insurance Company
has paid to Lessor under the Political Risk Insurance and the amount that
the United Mexican States has paid to Lessor as a result of the Political
Loss plus the reasonable expenses incurred by Lessor to collect such
amounts from the Insurance Company and the United Mexican States.
15. CANCELLATION OPTION. So long as no event of default has occurred and
continues under the Master Lease or any Schedule thereto AND so long as Lessee
gives Lessor written notice of its election under this paragraph at least 90
days, but no more than 180 days, prior to the Cancellation Date (as defined
below), Lessee may, subject the provisions of this paragraph, elect to cancel
this Schedule and return all of the Equipment. Lessee may not cancel the
Schedule under the terms of this paragraph UNLESS AND UNTIL all of the following
conditions have been satisfied in full on or before the Cancellation Date:
(a) Lessee shall pay to Lessor on the applicable Cancellation Date a return
and remarketing fee equal to the Cancellation Value (as defined below); AND
(b) Lessee shall return all, but not less than all, of the Equipment to
Lessor on the Cancellation Date in full compliance with subsection 23(b) of
the Master Lease and with all other return and maintenance requirements of
this Schedule.
"Cancellation Value" means the total of the following: (i) all rent, Taxes
and all other amounts then due and payable by Lessee under this Schedule and
Master Lease to the extent it relates to this Schedule; (ii) an amount equal
to FIFTY-SIX PERCENT (56%) of the Lessor's Cost of the Equipment stated above
in this Schedule; and (iii) sales and other Taxes due in connection with
Xxxxxx's receipt of the above amounts. "Cancellation Date" means the
scheduled rent payment date in the 24th MONTH OF THE LEASE TERM.
16. AMENDMENT OF PURCHASE OPTION AND RETURN OPTION.
(a) Solely for purposes of this Schedule and its Equipment, Lessor and
Lessee agree that if Lessee elects to exercise its option to purchase the
Equipment at the end of the Lease Term (which option is described in Section
23(c) of the Master Lease), then, notwithstanding anything to the contrary in
this Schedule or the Master Lease, the provisions of Section 23(d) of the Master
Lease for determining Fair Market Value for purposes of this purchase option
shall not apply and the purchase price of the Equipment at the end of the Lease
Term shall be equal to the FIXED PRICE
Page 4
stated below plus all Taxes (excluding income taxes on Lessor's gains on such
sale), costs and expenses incurred or paid by Lessor in connection with such
sale plus all accrued and unpaid amounts then due and payable with respect to
the Equipment or this Schedule.
Fixed Price: TEN PERCENT (10%) of the above Lessor's Cost of the
Equipment
(b) Solely for purposes of this Schedule and its Equipment, Lessor and
Lessee agree that if Lessee elect to exercise its option to return the Equipment
at the end of the Lease Term (which option is described in Section 23(b) of the
Master Lease), then Lessee shall return the Equipment in full compliance with
Section 23(b) of the Master Lease and with all other return and maintenance
requirements of this Schedule and there shall be a rent adjustment as provided
below in this subparagraph (b). The scheduled expiration date of the Lease Term
specified in this Schedule will be referred to as the "Termination Date".
(1) If the Actual Sale Proceeds as determined pursuant to subparagraph (c)
of this paragraph are less than the Fixed Price, then (A) Lessor shall
retain the Actual Sale Proceeds and (B) Lessee shall pay to Lessor the
difference between the Fixed Price and such Actual Sale Proceeds on
the Termination Date, PROVIDED, THAT the amount of said deficiency
payable by Lessee to Lessor shall not EXCEED NINE PERCENT (9%) of the
above Lessor's Cost of the Equipment; or
(2) If the Actual Sale Proceeds as determined pursuant to subparagraph (c)
of this paragraph equal or exceed the Fixed Price, then Lessor shall
retain the entire Actual Sale Proceeds.
(3) In all events, Lessee shall pay all Taxes (excluding income taxes on
Lessor's gains on such sale), costs and expenses incurred or paid by
Lessor in connection with any such sale plus all accrued and unpaid
amounts due and payable with respect to the Equipment or this Schedule
up to the date of any such sale.
(4) If for any reason whatsoever Lessee fails to return the Equipment in
full compliance with Section 23(b) of the Master Lease and with all
other return and maintenance requirements of this Schedule on or
before the Termination Date, then Lessee shall be deemed to have
elected to purchase Equipment pursuant to subparagraph (a) of this
paragraph.
Unless otherwise expressly agreed by Xxxxxx in writing, during the 90-day period
prior to the Termination Date, Lessee shall, and Lessor may, solicit offers to
purchase the Equipment from prospective purchasers. Neither Lessee nor third
parties affiliated with the Lessee may bid to purchase the Equipment. Lessor may
bid to purchase the Equipment.
(c) If one or more such offers to purchase the Equipment are received
under subparagraph (b) of this paragraph, then the Equipment shall be sold by
Lessor to the highest bidder within ten (10) days after the Termination Date and
the Actual Sale Proceeds shall equal the purchase price actually received by
Lessor after deducting all reasonable selling expenses. If no such offers to
purchase the Equipment are received or if the Equipment is not sold for any
reason, then the Actual Sale Proceeds shall be deemed to be zero and Lessee
shall pay the Fixed Price to Lessor pursuant to clause (1) of subparagraph (b)
of this paragraph plus all accrued and unpaid amounts due and payable with
respect to the Equipment or this Schedule up to the date of any such payment. If
Lessor subsequently sells the Equipment, then the purchase price actually
received by Lessor, after deducting all reasonable selling expenses, shall be
distributed as follows: first, to
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Lessor in an amount equal to the Fixed Price less the payment made by Lessee
pursuant to clause (1) of subparagraph (b) of this paragraph; second, to Lessee,
to the extent of its payment to Lessor pursuant to clause (1) of subparagraph
(b) of this paragraph; and lastly, the remainder to Lessor.
(d) Lessor shall, upon receipt of the purchase price of the Equipment
under this paragraph, convey title to the Equipment to the purchaser by a bill
of sale, which transfer shall be "AS-IS, WHERE IS", with all faults, without
recourse to Lessor and without any representation or warranty of any kind
whatsoever by Lessor, express or implied.
17. TAX BENEFIT. Solely for purposes of this Schedule and its Equipment, it is
the intention of the parties that Lessor shall not be entitled to such
deductions, credits and other tax benefits as are provided by federal, state,
and local income tax law to an owner of the Equipment and Section 10 of the
Master Lease is deleted. NOTWITHSTANDING ANYTHING TO THE CONTRARY IN THE
MASTER LEASE OR THIS SCHEDULE, XXXXXX MAKES NO REPRESENTATIONS OR WARRANTIES,
EXPRESS OR IMPLIED, AS TO THE TAX OR ACCOUNTING TREATMENT OR CONSEQUENCES OF
THIS SCHEDULE OR THE TRANSACTIONS CONTEMPLATED HEREBY.
18. GOVERNING DOCUMENT. In the event of any conflict between the terms of the
Master Lease and the terms of this Schedule as each is amended by its addenda,
the terms of this Schedule shall control.
19. SAVINGS CLAUSES. (a) If any court or other judicial authority determines
that this Schedule is a loan transaction or a conditional sale transaction, then
Lessor and Lessee agree: (1) that the original principal amount financed
pursuant to this Schedule is the Lessor's Cost set forth in paragraph 3 of this
Schedule; and (2) that Lessee shall pay said principal amount, together with
interest at the Initial Rate set forth in paragraph 6 of this Schedule (subject
to adjustment as set forth in paragraph 6 of this Schedule), by paying all
rentals and other amounts due under the Schedule plus the Fixed Price set forth
in paragraph 16 of this Schedule.
(b) If any court or other judicial authority determines that this Schedule
is a loan transaction or a conditional sale transaction, then as collateral
security for payment and performance of all Secured Obligations (defined below)
and to induce Lessor to extend credit from time to time to Lessee (under the
Master Lease or otherwise), Lessee hereby grants to Lessor a first priority
security interest in all of Lessee's right, title and interest in the Equipment,
whether now existing or hereafter acquired, and in all Proceeds (defined below),
and Lessee, at its sole expense, will protect and defend Xxxxxx's first priority
security interest in the Equipment against all claims and demands whatsoever.
Xxxxxx agrees that Lessor shall have all rights of a secured party under the
applicable Uniform Commercial Code. "Secured Obligations" means (1) all payments
and other obligations of Lessee under or in connection with this Schedule, and
(2) all payments and other obligations of Lessee (whether now existing or
hereafter incurred) under or in connection with the Master Lease and all present
and future Lease Schedules thereto, and (3) all other leases, indebtedness,
liabilities and/or obligations of any kind (whether now existing or hereafter
incurred, absolute or contingent, direct or indirect) of Lessee to Lessor or to
any affiliate of either Lessor or BANC ONE CORPORATION. "Proceeds" means all
cash and non-cash proceeds of the Equipment including, without limitation,
proceeds of insurance, indemnities and/or warranties.
20. PURCHASE ORDERS AND ACCEPTANCE OF EQUIPMENT. Lessee agrees that (i) Lessor
has not selected, manufactured, sold or supplied any of the Equipment, (ii)
Lessee has selected all of the Equipment and its suppliers, and (iii) Lessee has
received a copy of, and approved, the purchase orders or purchase contracts for
the Equipment. AS BETWEEN LESSEE AND LESSOR,
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XXXXXX AGREES THAT: (a) XXXXXX HAS RECEIVED, INSPECTED AND APPROVED ALL OF
THE EQUIPMENT; (b) ALL EQUIPMENT IS IN GOOD WORKING ORDER AND COMPLIES WITH
ALL PURCHASE ORDERS OR CONTRACTS AND ALL APPLICABLE SPECIFICATIONS; (c)
LESSEE IRREVOCABLY ACCEPTS ALL EQUIPMENT FOR PURPOSES OF THE LEASE "AS-IS,
WHERE-IS" WITH ALL FAULTS; AND (d) LESSEE UNCONDITIONALLY WAIVES ANY RIGHT
THAT IT MAY HAVE TO REVOKE ITS ACCEPTANCE OF THE EQUIPMENT.
XXXXXX HAS READ AND UNDERSTOOD ALL OF THE TERMS OF THIS SCHEDULE. XXXXXX AGREES
THAT THERE ARE NO ORAL OR UNWRITTEN AGREEMENTS WITH LESSOR REGARDING THE
EQUIPMENT OR THIS SCHEDULE.
Banc One Leasing Corporation STB Systems, Inc.
(Lessor) (Lessee)
By: /s/ Xxxxxxx Xxxx By: /s/ [ILLEGIBLE]
-------------------------------- --------------------------
Title: Funding Authority Title: [ILLEGIBLE]
---------------------------- -----------------------
Witness: /s/ [ILLEGIBLE]
----------------------
Lessor's Acceptance Date: October 31, 1997
Page 7
BANE ONE LEASING CORPORATION
SCHEDULE A-1 EQUIPMENT LEASED HEREUNDER
QUANTITY DESCRIPTION PAGE 1
----------- -------------------------------------------------------------------
----------- -------------------------------------------------------------------
*ALL PROPERTY DESCRIBED IN THE INVOICES IDENTIFIED BELOW, WHICH
PROPERTY MAY BE GENERALLY DESCRIBED AS MANUFACTURING AND COMPUTER
EQUIPMENT."
LOCATION: XXXXXXXX XXXXXXXX 0000
XXXXXX XXXXXX, XXXXXXXXX, XXXXXX
COST: $3,201,726.26
Vendor Invoice # Amount
CONVEYOR TECHNOLOGIES 436 $36,050.00
GEO. X. XXXXXXXX CO., INC. 1026694-04 $20,145.04
CEO. X. XXXXXXXX CO., INC. 1026694-05 $38,504.00
GEO. X. XXXXXXXX CO., INC. 1026694-01 $5,630.00
GEO. X. XXXXXXXX CO., INC 1026694-03 $11,260.00
GEO. X. XXXXXXXX CO., INC. 1026694-02 $4,633.37
MPM CORPORATION 83645 $75,147.38
MPM CORPORATION 83790 $175,343.87
NICOLET IMAGING SYSTEMS 97-08502 $66,487.50
NICOLET IMAGING SYSTEMS 97-08525 $66,487.50
RESEARCH, INC. 181107 $79,119.00
RESEARCH, INC. 181545 $79,119.00
RESEARCH, INC. 181607 $79,119.00
TECHNICAL DEVICES COMPANY 99333 $88,242.00
CONVEYORS & MATERIALS HANDLING, INC. C1515 $16,303.75
ELECTROVERT 11220411 $71,875.40
ELECTROVERT 11222715 $15,975.00
TOGETHER WITH ALL ATTACHMENTS, ADDITIONS, ACCESSIONS, PARTS,
REPAIRS, IMPROVEMENTS, REPLACEMENTS AND SUBSTITUTIONS THERETO.
This Schedule A-1 is attached to and made a part of Lease Number 1000063259 and
constitutes a true and accurate description of the equipment.
Lessee:
STB SYSTEMS, INC.
----------------------------------------------------
By: /s/ [ILLEGIBLE]
------------------------------------------------
Date: 10/31/97
----------------------------------------------
BANC ONE LEASING CORPORATION
SCHEDULE A-l EQUIPMENT LEASED HEREUNDER
QUANTITY DESCRIPTION PAGE 2
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ELECTROVERT 11221017 $7,478.22
ELECTROVERT 11219378 $584.23
UNIVERSAL 92026243 $386,400.00
UNIVERSAL 92026194 $386,400.00
UNIVERSAL 92026192 $386,400.00
UNIVERSAL 92026193 $386,400.00
UNIVERSAL 92026718 $113,316.40
UNIVERSAL 92030012 $85,578.40
UNIVERSAL 92029529 $100,059.20
UNIVERSAL 92031366 $332,442.00
TREK INDUSTRIES P070297 $82,156.00
PROCESS CONTROL TECHNOLOGIES, INC. 4402 $5,070.00
TOGETHER WITH ALL ATTACHMENTS, ADDITIONS, ACCESSIONS, PARTS,
REPAIRS, IMPROVEMENTS, REPLACEMENTS AND SUBSTITUTIONS THERETO.
This Schedule A-1 is attached to and made a part of Lease Number 1000063259 and
constitutes a true and accurate description of the equipment.
Lessee:
STB SYSTEMS, INC.
--------------------------------------------------------
By: /s/ [ILLEGIBLE]
----------------------------------------------------
Date: 10/31/97
--------------------------------------------------
CORPORATE GUARANTY
Dated October 31, 1997
Lessee Name: STB Systems, Inc.
Master Lease Agreement Dated October 30, 1996
Equipment Cost: Up To $8,000,000.00
1. For valuable consideration, the receipt of which is hereby acknowledged,
STB DE MEXICO, S.A. DE C.V. (hereinafter called the "undersigned" or
"Guarantor") guarantees to BANC ONE LEASING CORPORATION (hereinafter called
"Lessor") the full and prompt performance by the lessee identified above
(hereinafter called "Lessee") of all obligations which Lessee now has or may
hereafter have to Lessor, including but not limited to obligations under
equipment leases and promissory notes executed in connection with anticipated
equipment leases (including but not limited to all present and future lease
schedules and promissory notes under the Master Lease identified above, with a
total original equipment cost to the Lessor of up to the amount of the Equipment
Cost set forth above), and unconditionally guarantee the prompt payment when due
(whether at scheduled maturity, upon acceleration or otherwise) of any and all
sums, indebtedness and liabilities of whatsoever nature, due or to become due,
direct or indirect, absolute or contingent, now or hereafter at any time owed or
contracted by Lessee to Lessor, and all costs and expenses of and incidental to
collection of any of the foregoing, including reasonable attorneys' fees (all of
the foregoing hereinafter called "Obligations"). It is the undersigned's
express intention that this guaranty in addition to covering all present
Obligations of Lessee to Lessor, shall extend to all future Obligations of
Lessee to Lessor, whether or not such Obligations are reduced or entirely
extinguished and thereafter increased or are reincurred, whether or not such
Obligations are related to the Master Lease identified above, whether or not
such Obligations exceed the Equipment Cost identified above, and whether or not
such Obligations are specifically contemplated by the undersigned, Xxxxxx, and
Xxxxxx as of the date hereof.
2. This is an absolute and unconditional guarantee of payment and not of
collection. Lessor shall not be required, as a condition of the liability of
the undersigned, to resort to, enforce or exhaust any of its remedies against
the Lessee or any other party who may be liable for payment on any Obligation or
to resort to, xxxxxxxx, enforce or exhaust any of its remedies against any
leased property or any property given or held as security for this Guaranty or
any Obligation.
3. The undersigned hereby waive and grant to Lessor, without notice to the
undersigned and without in any way affecting the liability of the undersigned,
the right at any time and from time to time, to extend other and additional
credit, leases, loans or financial accommodations to Lessee apart from the
Obligations, to deal in any manner as it shall see fit with any Obligation of
Lessee to Lessor and with any leased property or security for such Obligation,
including, but not limited to, (i) accepting partial payments on account of any
Obligation, (ii) granting extensions or renewals of all or any part of any
Obligation, (iii) releasing, surrendering, exchanging, dealing with, abstaining
from taking, taking, abstaining from perfecting, perfecting, or accepting
substitutes for any or all leased property or security which it holds or may
hold for any Obligation, (iv) modifying, waiving, supplementing or otherwise
changing any of the terms, conditions or provisions contained in any Obligation
and (v) the addition or release of any other party or person liable hereon,
liable on the Obligations or liable on any other guaranty executed to guarantee
any of Xxxxxx's Obligations. The
Page 1
undersigned jointly and severally hereby agree that any and all settlements,
compromises, compositions, accounts stated and agreed balances made in good
faith between Lessor and Lessee shall be binding upon the undersigned.
4. Every right, power and discretion herein granted to Lessor shall be for
the benefit of the successors or assigns of Lessor and of any transferee or
assignee of any Obligation covered by this Guaranty, and in the event any such
Obligation shall be transferred or assigned, every reference herein to Lessor
shall be construed to mean, as to such Obligation, the transferee or assignee
thereof. This Guaranty shall be binding upon each of the undersigned's
executors, administrators, heirs, successors and assigns.
5. This Guaranty shall continue in force for so long as Lessee shall be
obligated to Lessor, and thereafter until Lessor shall have actually received
written notice of the termination hereof from the undersigned, it being
contemplated that Lessee may borrow, lease, repay and subsequently borrow money
from or lease property from, or become obligated to, Lessor from time to time,
and the undersigned, not having given notice of the termination hereof as herein
provided for, shall be deemed to have permitted this Guaranty to remain in full
force and effect for the purpose of inducing Lessor to make further leases or
loans to Lessee; provided, however, no notice of termination of this Guaranty
shall affect in any manner the rights of Lessor arising under this Guaranty with
respect to the following: (a) any Obligation incurred by Lessee in connection
with the Master Lease identified above with a total equipment cost of no more
than the amount of the Total Equipment Cost set forth above, whether such
obligation is in the form of a lease or a promissory note; or (b) any Obligation
incurred by Lessee prior to receipt by Lessor of written notice of termination
or any Obligation incurred after receipt of such written notice pursuant to a
written agreement entered into by Lessor prior to receipt of such notice. The
undersigned expressly waive notice of the incurring by Xxxxxx of any Obligation
to Lessor. The undersigned also waive presentment, demand of payment, protest,
notice of dishonor or nonpayment of or nonperformance of any Obligation.
6. The undersigned hereby waive any claims or rights which they might now
have or hereafter acquire against Lessee or any other person primarily or
contingently liable on any Obligation of Lessee, which claims or rights arise
from the existence or performance of the undersigned's obligations under this
Guaranty or any other guaranty or under any instrument or agreement with respect
to any leased property or any property constituting collateral or security for
this Guaranty or any other guaranty, including, without limitation, any right of
subrogation, reimbursement, exoneration, contribution, indemnification, or any
right to participate in any claim or remedy of Lessor or any other creditor
which the undersigned now has or hereafter acquires, whether such claim or right
arises in equity, under contract or statute, at common law, or otherwise.
7. Xxxxxx's rights hereunder shall be reinstated and revived, and this
Guaranty shall be fully enforceable, with respect to any amount at any time paid
on account of the Obligations which thereafter shall be required to be restored
or returned by Lessor upon the bankruptcy, insolvency or reorganization of the
Lessee, the undersigned, or any other person, or as a result of any other fact
or circumstance, all as though such amount had not been paid.
8. The undersigned jointly and severally agree to pay to Lessor all costs
and expenses, including reasonable attorneys' fees, incurred by Xxxxxx in the
enforcement or attempted enforcement of this Guaranty, whether or not suit is
filed in connection therewith, or in the exercise by Lessor of any right,
privilege, power or remedy conferred by this Guaranty.
Page 2
9. The undersigned represent and warrant that they have relied
exclusively on their own independent investigation of Xxxxxx, the leased
property and the collateral for their decision to guarantee Xxxxxx's
Obligations now existing or thereafter arising. The undersigned agree that
they have sufficient knowledge of the Lessee, the leased property, and the
collateral to make an informed decision about this Guaranty, and that Lessor
has no duty or obligation to disclose any information in its possession or
control about Lessee, the leased property, and the collateral to the
undersigned. The undersigned warrant to Lessor that they have adequate means
to obtain from the Lessee on a continuing basis information concerning the
financial condition of the Lessee and that they are not relying on Lessor to
provide such information either now or in the future.
10. As long as any indebtedness under any of the Obligations remains unpaid
or any credit is available to Lessee under any of the Obligations, the
undersigned agree to furnish to Lessor: (a) annual financial statements setting
forth the financial condition and results of operation of the undersigned
(financial statements shall include balance sheet, income statement, changes in
financial position and all notes thereto) within 120 days of the end of each
fiscal year of the undersigned; (b) quarterly financial statements setting
forth the financial condition and results of operation of the undersigned within
60 days of the end of each of the first three fiscal quarters of the
undersigned: and (c) such other financial information as Lessor may from time to
time request including, without limitation, financial reports filed by the
undersigned with federal or state regulatory agencies.
11. No postponement or delay on the part of Lessor in the enforcement of any
right hereunder shall constitute a waiver of such right. The failure of any
person or entity to sign this Guaranty shall not discharge the liability of any
of the undersigned.
12. GUARANTOR HEREBY EXPRESSLY WAIVES THE BENEFITS ESTABLISHED BY
ARTICLES 2709, 2710 AND 2712 OF THE CIVIL CODE FOR THE STATE OF CHIHUAHUA.
LIKEWISE, GUARANTOR EXPRESSLY WAIVES THE BENEFITS ESTABLISHED IN ARTICLES
2738, 2739, 2740, 2742 AND 2743 OF THE CIVIL CODE FOR THE STATE OF CHIHUAHUA,
AUTHORIZING LESSOR WITHOUT NOTICE OR DEMAND AND WITHOUT LIABILITY TO THE TERMS
OF PARAGRAPHS 1, 2, 3, 4, 5, 6, 7, AND 8 OF THIS GUARANTY.
13. Any and all amounts required to be paid by the undersigned hereunder
shall be paid in lawful money of the United States of America strictly in
accordance with the terms and provisions of the Obligations, without set-off or
counterclaim and without deduction for and free and clear of any and all taxes,
levies, imposts, duties, fees, charges, deductions, withholdings, restrictions
or conditions of any nature now or hereafter imposed, levied, collected,
withheld or assessed with respect to the Obligations or this Guaranty or the
proceeds to the holder hereof by the country identified below or any other
country or any political subdivision or taxing authority or other agency
thereof or therein other than the United States of America or any of its
political subdivisions ("Foreign Taxes"). If any Foreign Taxes are required to
be deducted or withheld from any amounts payable to Lessor under this Guaranty,
such amount payable shall be increased to yield to Lessor (after payment of all
Foreign Taxes) the amount specified to be paid hereunder, reduced by the
amount of any foreign tax credit actually received and used by Lessor under the
income tax laws of the United States resulting from the payment of such Foreign
Taxes. Whenever any Foreign Tax is paid by the undersigned on behalf of Xxxxxx,
as promptly as possible thereafter the undersigned shall send Lessor an official
receipt showing payment thereof, together with such additional documentary
evidence as may be required from time to time by Xxxxxx. The obligation of the
undersigned hereunder to make payments in lawful money of the United States of
America shall not
Page 3
be discharged or satisfied by any tender or recovery pursuant to any judgment
expressed in or converted into any currency other than United States Dollars
EXCEPT TO THE EXTENT that any such tender or recovery shall comply with
mandatory laws of the United Mexican States which provide for payment of
obligations in the currency of the United Mexican States; provided, that any
such payment in currency of the United Mexican States shall be made at the
then current legal exchange rate in the United Mexican States if mandatory
laws of the United Mexican States require Lessor to accept such legal
exchange rate or, if permitted by the laws of the United Mexican States, at
the then current market exchange rate that results in the effective receipt
by Lessor of the full amount of United States Dollars expressed to be payable
hereunder.
Undersigned's Country of Organization: United Mexican States
14. For purposes of this Guaranty and the resolution of disputes hereunder,
the parties irrevocably submit and consent to, and waive any objection to, the
jurisdiction and venue of the state or federal courts located in Dallas County,
Texas it being acknowledged and agreed that the subject matter of the Lease is
located in Dallas County, Texas. Venue for the enforcement of any obligations
contained herein shall lie in Dallas County, Texas and the parties hereby waive
the right to be sued elsewhere. The undesigned further agree that final judgment
against it in any such legal action, suit or proceeding shall be conclusive and
may be enforced in any other jurisdiction, within or outside the United States
of America, by suit on the judgment, a certified or exemplified copy of which
shall be conclusive evidence of the fact and amount of its liability.
15. This Guaranty contains the entire agreement of the parties and supersedes
all prior agreements and understandings, oral or written, with respect to the
subject matter hereof. This Guaranty is not intended to replace or supersede any
other guaranty which the undersigned have entered into or may enter into in the
future. The undersigned may enter into additional guaranties in the future which
may or may not refer to the Master Lease identified above and such guaranties
are not intended to replace or supersede this Guaranty unless specifically
provided in that additional guaranty. The interpretation, construction and
validity of this guaranty shall be governed by the laws of the State of Ohio in
the United States of America.
[The next page is the signature page.]
Page 4
ALL PARTIES TO THIS GUARANTY, INCLUDING GUARANTOR AND XXXXXX, WAIVE ALL
RIGHTS TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT
BY ANY PARTY AGAINST ANY OTHER PARTY ON ANY MATTER WHATSOEVER ARISING OUT
OF, IN CONNECTION WITH OR IN ANY WAY RELATED TO THIS GUARANTY.
Undersigned/Guarantor
STB DE MEXICO, S.A. DE C.V.
(Name of Guarantor)
By: /s/ [ILLEGIBLE]
---------------------------------
Title:
------------------------------
Witness:
----------------------------
ACKNOWLEDGED BY:
STB SYSTEMS, INC. BANC ONE LEASING CORPORATION
(Lessee) (Lessor)
BY: /s/ [ILLEGIBLE] By: /s/ Xxxxxxx Xxxx
------------------------------ -----------------------------
Title: /s/ COO Title: Funding Authority
--------------------------- --------------------------
Page 5
SECURITY AGREEMENT
Lessee: STB Systems, Inc.
Master Lease Agreement Dated: 10-30-96
Equipment Cost: $8,000,000.00
This Agreement is made as of October 31, 1997 by and between Banc One
Leasing Corporation ("Banc One Leasing"), with Banc One Leasing's mailing
address being at 0000 Xxxxxxx Xxxxxxx, Xxxxx X0 (XX0-1085), Columbus, Ohio 43240
and Debtor(s) identified below (individually and collectively, the "Debtor").
Debtor means: STB Systems, Inc.
1. GRANT OF SECURITY INTEREST. For valuable consideration, receipt of
which is hereby acknowledged, Debtor grants, pledges and assigns to Banc One
Leasing a security interest in all of Debtor's respective right, title and
interest, purchase money as appropriate, in and to the property described
below, now or hereafter arising or acquired, wherever located, together with
any and all additions, accessions, parts, accessories, substitutions and
replacements thereof, now or hereafter installed in, affixed to or used in
connection with said property, in all products and proceeds thereof, cash and
non-cash, including, but not limited to, proceeds of notes, checks,
instruments, indemnity proceeds, or any insurance on such and any refund or
rebate of premiums on such, and all books, records, ledger cards, files,
correspondence, computer program, tapes, disks and related data processing
software, owned by Debtor or in which it has an interest that at any time
evidences or contains information relating thereto or is otherwise necessary
or helpful in the collection thereof or realization thereupon ("Collateral"),
to secure the prompt payment and complete performance of the Obligations (as
hereinafter defined); provided, however, that the Collateral shall not
include any Hazardous Materials (as hereinafter defined), except for any
Hazardous Materials (a) which are and/or hereafter will be handled, stored
and contained in accordance with all applicable Hazardous Materials Laws (as
hereinafter defined) and (b) which either (i) are and/or will be hereafter
used or useful in the ordinary course of business of Debtor or (ii) have a
resale or salvage value which exceeds the cost of disposing of such Hazardous
Materials.
The Collateral in which this security interest is granted is all of the
Debtor's property described in EXHIBIT A attached hereto (and such terms as are
used in Exhibit A shall be used in their broadest definitions and shall include,
without limitation, the definitions of such terms as are found in the Uniform
Commercial Code that governs security interests in any such property).
2. SECURED OBLIGATIONS. This Agreement secures the full and prompt
performance by the lessee identified above (hereinafter called "Lessee") and any
Debtor of all obligations which Debtor or Lessee now have or may hereafter have
to Banc One Leasing, including, but not limited to, obligations under equipment
leases, promissory notes, loan agreements and guaranties executed in connection
with equipment leases, promissory notes or loan agreements (including but not
limited to all present and future leases, promissory notes and guaranties under
the Master Lease Agreement identified above, with a total original equipment
cost to Banc One Leasing of up to the amount of the Equipment Cost set forth
above), and secures the prompt payment when due (whether at scheduled maturity,
upon acceleration or otherwise) of any and all sums, indebtedness, obligations
and liabilities of whatsoever nature, due or to become due, direct or indirect,
absolute or contingent, now or hereafter at any time owed or contracted by
Lessee or Debtor to Banc One Leasing, and all costs and expenses of and
incidental to collection of any of the foregoing, including reasonable
attorneys' fees (all of the foregoing hereinafter called "Obligations"). It is
Debtor's express intention that this Agreement and the continuing security
interest granted hereby, in addition to covering all present Obligations of
Lessee and Debtor to Banc One, shall extend to all future Obligations of Lessee
and Debtor to Banc One, whether or not such Obligations are reduced or entirely
extinguished and thereafter increased or are reincurred, whether or not such
Obligations are related to the above Master Lease Agreement, whether or not such
Obligations exceed the Equipment Cost identified above, and whether or not such
Obligations are specifically contemplated by Xxxxxx and Banc One as of the date
hereof. The absence
Page 1
of any reference to this Agreement in any documents, instruments or agreements
evidencing or relating to any Obligations secured hereby shall not limit or be
construed to limit the scope of this Agreement.
3. LOCATION(S) OF COLLATERAL. The Collateral will be kept at the
location(s) set forth in EXHIBIT B attached hereto ("Location").
4. REPRESENTATIONS, WARRANTIES AND COVENANTS. Debtor represents, warrants,
covenants and agrees as follows:
(a) Debtor is and will continue to be (or, with respect to after acquired
property, will be when acquired), the legal and beneficial owner of the
Collateral free and clear of any lien, security interest, mortgage, charge or
encumbrance except for the security interest created by this Agreement and/or
any other prior security agreement delivered by Debtor to Banc One Leasing and
any Permitted Lien approved by Banc One Leasing's signature on EXHIBIT C
attached hereto ("Permitted Liens"). Except as previously disclosed to Banc One
Leasing in writing on Exhibit C as to Permitted Liens, no effective Uniform
Commercial Code ("UCC") financing statement or other instrument covering all or
any part of the Collateral is on file in any recording office, except those in
favor of Banc One Leasing;
(b) Debtor will join with Banc One Leasing in executing such financing
statements, security agreements or other instruments in form satisfactory to
Banc One Leasing upon Banc One Leasing's request and, in the event for any
reason the law of any jurisdiction becomes or is applicable to the Collateral
or any part thereof, or to any Obligation owed to Banc One Leasing, Debtor
agrees to execute and deliver all such instruments and to do all of such
other things as may be reasonably necessary or appropriate to preserve,
protect and enforce the security interest and lien of Banc One Leasing under
the law of such jurisdiction to the extent such security interest would be
protected under that jurisdiction's UCC and will pay all expenses of filing
and releasing same in all public offices wherever filing is deemed necessary
or desired by Banc One Leasing;
(c) The Collateral will not be attached or affixed to real estate in
such a manner that it would become a fixture thereto or an accession to other
goods without prior disclosure, notification to and approval by Banc One
Leasing in addition to the execution of an owner/mortgagee/landlord
release/waiver in favor of Banc One Leasing;
(d) Debtor at its sole expense shall keep each item of Collateral
insured against all risks of loss or damage from every cause whatsoever for
an amount not less than the greater of the full replacement value or the
original cost of acquiring such item of Collateral. Debtor at its sole
expense shall carry public liability and property damage insurance in amounts
satisfactory to Banc One Leasing protecting Debtor and Banc One Leasing from
liabilities for injuries to persons and damage to property of others relating
in any way to the Collateral. Debtor at its sole expense shall carry
environmental risk insurance should any of the collateral include Hazardous
Materials. All insurers shall be reasonably satisfactory to Banc One
Leasing. Debtor shall deliver to Banc One Leasing satisfactory evidence of
such coverage. Proceeds of any insurance covering damage or loss of the
Collateral shall be payable to Banc One Leasing as loss payee and shall, at
Banc One Leasing's option, be applied toward (a) the replacement, restoration
or repair of the Collateral, or (b) payment of the obligations of Debtor
under the Obligations. Proceeds of any public liability or property insurance
shall be payable first to Banc One Leasing as additional insured to the
extent of its liability, then to Debtor. Debtor hereby appoints Banc One
Leasing as Debtor's attorney-in-fact with full power and authority in the
place of Debtor and in the name of Debtor or Banc One Leasing to make claim
for, receive payment of, and sign and endorse all documents, checks or drafts
for loss or damage under any such policy. Each insurance policy will require
that the insurer give Banc One Leasing at least 30 days prior written notice
of any cancellation of such policy and will require that Banc One Leasing's
interests be continued insured regardless of any act, error, omission,
neglect or misrepresentation of Debtor. The insurance maintained by Debtor
shall be primary without any right of contribution from insurance which may
be maintained by Banc One Leasing. If Debtor does not keep the Collateral
insured as required herein and/or fails to supply Banc One Leasing with
evidence of that insurance, Banc One Leasing shall have the right, in its
sole discretion, to obtain insurance in amounts sufficient to fully protect
its interest, without notifying Debtor. Xxxxxx agrees that Banc One Leasing
shall have
Page 2
the right, in its sole discretion, to determine the manner in which Debtor
shall reimburse Banc One Leasing for the premium for such insurance, including
but not limited to (a) requiring Debtor to immediately reimburse Banc One
Leasing for the premium and other costs it incurs or (b) adding that amount
directly to the principal balance of any of the Obligations. Debtor will pay
interest on any amount added to the principal balance at the highest rate set
forth in any of such Obligation(s);
(e) Debtor will pay promptly when due all taxes, assessments and
governmental charges upon or against Debtor, the Collateral or the property
or operations of Debtor, in each case before same becomes delinquent and
before penalties accrue thereon, unless and to the extent that same are being
contested in good faith by appropriate proceedings. At its option, Banc One
Leasing may discharge taxes, liens or security interests or other
encumbrances at any time placed on the Collateral and may pay for maintenance
and preservation of the Collateral, all at Debtor's expense;
(f) Debtor agrees it will, at its sole expense: (a) repair and maintain
the Collateral in good condition and working order and supply and install all
replacement parts or other devices when required to so maintain the
Collateral or when required by applicable law or regulation, which parts or
devices shall automatically become part of the Collateral; (b) use and
operate the Collateral in a careful manner in the normal course of its
business and only for the purposes for which it was designed in accordance
with the manufacturer's warranty requirements, and comply with all laws and
regulations relating to the Collateral, and obtain all permits or licenses
necessary to install, use or operate the Collateral; and (c) make no
alterations, additions, subtractions, upgrades or improvements to the
Collateral without Banc One Leasing's prior written consent, but any such
alterations, additions, upgrades or improvements shall automatically become
part of the Collateral. The Collateral will not be used or located outside
of the United States.
(g) Debtor will, in the event of appropriation or taking of all or any
part of the Collateral, give Banc One Leasing prompt written notice thereof.
Banc One Leasing shall be entitled to receive directly, and Debtor shall
promptly pay over to Banc One Leasing, any awards or other amounts payable
with respect to such condemnation, requisition or other taking and in its
sole discretion may apply the proceeds as it deems best without regard to
whether an Event of Default has or has not occurred;
(h) At least thirty (30) days prior to the occurrence of the event,
Debtor will deliver to Banc One Leasing written notice of any addition change
in Debtor's name, identity or legal structure;
(i) Debtor will defend the Collateral against all claims and demands of
all persons at any time claiming the same or an interest therein;
(j) Debtor will from time to time execute and deliver to Banc One Leasing
such lists, descriptions and designations of Collateral as Banc One Leasing
may require to identify the nature, extent and location of the Collateral;
(k) Debtor is in material compliance with all Federal, State and local
laws, statutes, ordinances, regulations, rulings and interpretations relating
to industrial hygiene, public health or safety, environmental conditions, the
protection of the environment, the release, discharge, emission or disposal
to air, water, land or ground water, the withdrawal or use of ground water or
the use, handling, disposal, treatment, storage or management of or exposure
to Hazardous Materials ("Hazardous Materials Laws"), the violation of which
would have a material effect on its business, its financial condition or the
Collateral. The term "Hazardous Materials" means any flammable materials,
explosives, radioactive materials, pollutants, toxic substances, hazardous
water, hazardous materials, hazardous substances, polychlorinated biphenyls,
asbestos, urea formaldehyde, petroleum (including its derivatives,
by-products or other hydrocarbons) or related materials or other controlled,
prohibited or regulated substances or materials, including, without
limitation, any substances defined or listed as or included in the definition
of "hazardous substance", "hazardous wastes", "hazardous materials",
"pollutants" or "toxic substances" under any Hazardous Materials Laws. Debtor
has not received any written or oral communication or notice from any
judicial or governmental entity nor is it aware of any investigation by any
agency for any violation of any Hazardous Materials Law;
Page 3
(i) All representations, warranties, covenants and agreements set forth
herein and all information furnished by Debtor concerning the Collateral or
otherwise in connection with the Obligations, shall be at the time same is
furnished, accurate, correct and complete in all material respects as of the
date hereof, on the date upon which Debtor acquires any of the Collateral or any
rights therein not presently acquired or existing and shall continue until the
Obligations are paid in full.
5. APPOINTMENT OF ATTORNEY-IN-FACT. Debtor hereby irrevocably appoints
Banc One Leasing or its designee as Debtor's attorney in fact, with full
authority in the place instead of Debtor, from time to time in Banc One
Leasing's discretion prior to, upon, during, and after an Event of Default,
to take any action and to execute any instrument which Banc One Leasing may
deem necessary or advisable to accomplish the purposes of this Agreement,
including without limitation, (a) to perfect and continue to perfect the
security interests created by this Agreement; (b) to ask, demand, collect or
sue for, recover, compound, receive and give acquittance in receipts for any
monies due or become due under or in respect for any Collateral; (c) to
receive, endorse and collect any drafts or other instruments, documents and
chattel paper, in connection with the Collateral; and (d) to file any claims
or take any action or institute any proceeding which Banc One Leasing may
deem necessary or desirable for the collection of any Collateral or otherwise
to enforce the rights of Banc One Leasing in the Collateral.
6. EVENTS OF DEFAULT. The following events shall be "Events of Default
under this Agreement: (a) default by Debtor in performance of any covenant or
agreement herein; (b) any warranty, representation or statement made or
furnished to Banc One Leasing by or on behalf of Debtor in connection with
this Agreement or to induce Banc One Leasing to make a loan or extend other
credit to Debtor, proving to have been false in any material respect when
made or furnished; (c) default by Debtor or any other obligor in performance
of any covenant or agreement contained in any Obligation; (d) default by
Debtor of any other obligor in performance of any covenant or agreement
contained in any letter or agreement executed in conjunction with any
Obligation; (e) death, dissolution, termination of existence, insolvency,
business failure, appointment of a receiver of any part of the property of,
assignment for the benefit of creditors by or the commencement of any
proceeding under any bankruptcy or insolvency laws by or against Debtor or
any guarantor or surety for Debtor; (f) any uninsured loss, theft, damage or
destruction of the Collateral; (g) the making of any levy, seizure or
attachment of any Collateral; (h) refusal to surrender the Collateral as
herein above provided; or (i) if Banc One Leasing shall for any reason deem
itself insecure as to the prospect of payment of any Obligation.
7. RIGHTS UPON DEFAULT. If any Event of Default shall occur, then:
(a) Banc One Leasing may, at its option and without notice, declare the
unpaid balance of any or all of the Obligations immediately due and payable
and this Agreement and any or all of the Obligations in default;
(b) All payments received by Debtor under or in connection with any of
the Collateral shall be held by Debtor in trust for Banc One Leasing, shall
be segregated from other funds of Debtor and shall forthwith upon receipt by
Debtor be turned over to Banc One Leasing in the same form as received by
Debtor (duly endorsed by Debtor to Banc One Leasing, if required). Any and
all such payments so received by Banc One Leasing (whether from Debtor or
otherwise) may, in the sole discretion of Banc One Leasing, be held by Banc
One Leasing, or then or at any time thereafter be applied in whole or in part
by Banc One Leasing against, all or any part of the Obligations in such order
as Banc One Leasing may elect;
(c) Banc One Leasing shall have the rights and remedies of a secured
party under this Agreement, under any other instrument or agreement securing,
evidencing or relating to the Obligations and under the UCC as adopted in the
state where Banc One Leasing's principal office is located or other
applicable laws. Without limiting the generality of the foregoing, Banc One
Leasing shall have the right to take possession of the Collateral in full or
in part and for that purpose Banc One Leasing may enter upon any premises on
which the Collateral may be situated and remove the Collateral therefrom;
(d) Without demand of performance or other demand, advertisement or
notice of any kind (except the notice(s) specified below regarding the time
and place of public sale or disposition or time after which a private sale or
disposition is to occur) to Debtor, any Obligor or any other person or entity
(all and each of
Page 4
which demands, advertisements and/or notices are hereby expressly waived),
Banc One Leasing may forthwith collect, receive, appropriate and realize upon
the Collateral, in full or in any part thereof, may abandon, not claim or not
take possession of any Collateral, and/or may forthwith sell, lease, assign,
give an option or options to purchase or sell or otherwise dispose of and
deliver the Collateral (or contract to do so), or any part thereof, in one or
more parcels at public or private sale(s) at any of Banc One Leasing's
offices or elsewhere at such price(s) as Banc One Leasing may determine, for
cash or on credit or for future delivery without assumption of any credit
risk. Banc One Leasing shall have the right upon any public sale(s), and, to
the extent permitted by law, upon any such private sale(s), to purchase the
whole or any part of the Collateral so sold, free of any right or equity of
redemption of Debtor;
(e) Debtor, at Banc One Leasing's request, will assemble the Collateral
and it available to Banc Leasing at such place(s) as Banc One Leasing may
reasonably select, whether at Debtor's place(s) of business and/or the
Location of Collateral or elsewhere. Debtor further agrees to allow Banc One
Leasing to use or occupy Debtor's place(s) of business and/or Location of
Collateral, without charge, for the purpose of effecting Banc One Leasing's
remedies in respect to the Collateral;
(f) Banc One Leasing shall apply the net proceeds of any such
collection, recovery, receipt, appropriation, realization or sale, after
deducting all reasonable costs and expenses of every kind incurred in
connection therewith or incidental to the care or safekeeping of any or all
of the Collateral or in any way relating to the rights of Banc One Leasing
hereunder, including attorneys' fees and legal expenses, to the payment in
whole or in part of the Obligations, in such order as Banc One Leasing may
elect, and only after or applying over such net proceeds and after the
payment by Banc One Leasing of any other amount required by any provision of
law, need Banc One Leasing account for the surplus, if any, to Debtor;
(g) To the extent permitted by applicable law, Debtor waives all claims,
damages and demands against Banc One Leasing arising out of the repossession,
retention, sale or disposition of the Collateral;
(h) Xxxxxx agrees that Banc One Leasing need not give more than ten (10)
calendar days' notice, addressed to Debtor at Debtor's mailing address set
forth above, of the time and place of any public sale or of the time after
which a private sale may take place and that such notice is reasonable
notification of such matters; and
(i) Debtor shall remain liable for any deficiency if the proceeds of any
sale or disposition of the Collateral are insufficient to pay all amounts to
which Banc One Leasing is entitled.
8. PROCESSING OF COLLATERAL AFTER AN EVENT OF DEFAULT. Debtor hereby
agrees that Banc One Leasing or its designee may do whatever Banc One Leasing
in its sole discretion deems to be commercially reasonable to prepare any
Collateral for disposition and to dispose of any Collateral, including
without limitation operating any of Debtor's manufacturing or other processes
relating to the Collateral and using patents, copyrights, trademarks, trade
names, trade secrets, rights under manufacturer's warranties, and the like
relating to or affecting such processes or the Collateral and disposition
thereof, and that Debtor shall not do anything which would restrict Banc One
Leasing's right so to act. Banc One Leasing may transfer Collateral into its
name or that of a nominee and receive the dividends, royalties or income
thereof. Banc One Leasing shall have no duty as to the collection or
protection of the Collateral or any income therefrom, nor as the preservation
of rights against prior parties, not as to the preservation of any right
pertaining thereto.
9. CONSTRUCTION OF RIGHTS AND REMEDIES AND WAIVER OF NOTICE AND
CONSENT. Unless otherwise expressly provided herein, (a) any right or remedy
of Banc One Leasing may be pursued without notice to or further consent of
Debtor, both of which Debtor hereby expressly waives; (b) each right or
remedy is distinct from but cumulative to each other right or remedy and may
be exercised independently of concurrently with, or successively to any other
right and remedy; (c) no extension(s) of time and/or modification(s) of
amortization of any Obligation shall release the liability of or bar the
availability of any right or remedy against Debtor, and Banc One Leasing
shall not be required to commence proceedings against Debtor or to extend
time for payment or otherwise to modify amortization of any Obligation; and
(d) Banc One Leasing has the right to proceed at its election against any or
all of the Collateral, against all such property together or against
Page 5
any items thereof from time to time, and not action against any item(s) of
property shall bar subsequent actions against any other item(s) of property.
10. EXTENSIONS AND COMPROMISES. With respect to any Collateral or any
Obligation, Debtor assents to all extensions or postponements to the time of
payment thereof or any other indulgence in connection therewith, to each
substitution, exchange or release of Collateral, to the release of any party
primarily or secondarily liable, to the acceptance of partial payment thereof
or to the settlement or compromise thereof, all in such matter and such time
or times as Banc One Leasing may deem advisable. No forbearance in exercising
any right or remedy on any one or more occasions shall operate as a waiver
thereof on any future occasion; and no single or partial exercise of any
right or remedy shall preclude any other exercise thereof or the exercise of
any other right or remedy.
11. INDEMNITY AND EXPENSES. (a) Debtor agrees to indemnify Banc One
Leasing from any and all claims, losses and liabilities growing out of or
resulting from this Agreement; (b) Debtor will upon demand pay or reimburse
Banc One Leasing, as the case may be, the amount of any and all expenses,
including fees and disbursements of counsel, experts and agents, which Banc
One Leasing may incur in connection with, (i) the administration of this
Agreement; (ii) the custody, preservation, use or operation of, or the sale
of, collections from, or other realization upon any Collateral; (iii) the
exercise or enforcement of any of the rights of Banc One Leasing hereunder;
or (iv) the failure by Debtor to perform or observe any of the provisions
hereof. Upon Debtor's failure to promptly pay any said amount, Banc One
Leasing may add said amount to the principal amount owed on any Obligation
and charge interest on the same at the rate of interest as set forth in said
Obligation; (c) Debtor shall fully and promptly pay, perform, discharge,
defend, indemnify and hold harmless Banc One Leasing from any and all claims,
orders, demands, causes of action, proceedings, judgments, or suits and all
liabilities, losses, costs or expenses (including, without limitation,
technical consultant fees, court cost, expenses paid to third parties and
reasonable legal fees) and damages arising out of, or as a result of (i) any
release, discharge, deposit, dump, spill, leak or placement of any Hazardous
Material into or on any Collateral or property owned, leased, rented or used
by Debtor (the "Property") at any time; (ii) any contamination of the soil or
ground water of the Property or damage to the environment and natural
resources of the Property or the result of actions whether arising under any
Hazardous Materials Law, or common law; or (iii) any toxic, explosive or
otherwise dangerous Hazardous Materials which have been buried beneath or
concealed with the Property. The indemnities set forth in this paragraph
shall survive termination of this Agreement and shall be effective for the
full dollar amount of any said cost, expense, etc., regardless of the actual
dollar amount of any Obligation(s).
12. MISCELLANEOUS. (a) Any notice, statement, request, demand, consent,
or other document required to be given hereunder (any of which may be
referred to as "notice") by either party shall be in writing and shall be
delivered personally or by certified or registered mail, postage prepaid,
return receipt requested, to the last known address of said party. When
personally delivered, any notice shall be deemed given when actually
received. Except as otherwise provided herein, a notice shall be deemed given
when mailed. Any mailed notice given pursuant to this section shall be deemed
reasonable and shall be effective, regardless of whether actually received;
The annual financial statements required by Section 17(a) of the Master Lease
shall be audited by certified public accountants reasonably acceptable to
Lessor;(b) this Agreement shall be construed and interpreted under the laws
of the state of Ohio; (c) this Agreement shall be binding upon Debtor,
Debtor's personal representatives, heirs, successors and assigns, as the case
may be, and shall be binding upon the inure to the benefit of Banc One
Leasing and its successors and assigns. Debtor cannot assign this Agreement;
(d) this Agreement may be amended, but only by a written amendment signed by
Banc One Leasing and Debtor; (e) if any provisions of this Agreement or the
application of any provision to any party or circumstance shall, to any
extent, be adjudged invalid or unenforceable, the application of the
remainder of such provision to such party or circumstance, the application of
such provision to other parties or circumstances, and the application of the
remainder of this Agreement shall not be affected thereby; (f) the headings
contained in this Agreement have been inserted for convenience of reference
only and are not to be used to interpreting this Agreement; (g) where
appropriate, the number of all words in this Agreement shall be both singular
and plural and the gender of all pronouns shall be masculine, feminine,
neuter, or any combination thereof; (h) a carbon, photographic or other
reproduction of this Agreement or a financing statement shall be sufficient
as a financing statement and may be filed as such whenever necessary or
desirable, in Banc One Leasing's opinion, to perfect the security interest
granted by this Agreement; (i) Banc
Page 6
One Leasing may correct patent errors herein, may fill in any blank spaces
herein and may date this Agreement; (j) if more than one signer executes this
instrument, the word "Debtor" as used herein shall be deemed to include all
such signers, and all of the warranties, representations, covenants and
obligations hereof shall be joint and several of and for all such signers;
(k) this Agreement shall take effect when signed by Xxxxxx, and (l) time is
of the essence of all requirements of Debtor hereunder.
ALL PARTIES TO THIS AGREEMENT, INCLUDING DEBTOR AND BANC ONE LEASING,
IRREVOCABLY CONSENT TO THE JURISDICTION AND VENUE OF ANY STATE OR FEDERAL
COURT IN FRANKLIN COUNTY, OHIO, AND WAIVE ALL RIGHTS TO TRIAL BY JURY, IN ANY
ACTION, PROCEEDING OR COUNTERCLAIM BROUGHT BY ANY PARTY AGAINST ANY OTHER
PARTY ON ANY MATTER WHATSOEVER ARISING OUT OF, IN CONNECTION WITH OR IN ANY
WAY RELATED TO THIS AGREEMENT.
STB Systems, Inc.
(Debtor)
By: /s/ [ILLEGIBLE]
--------------------------------
Title: COO
------------------------------
Witness: /s/ Xxxxx [ILLEGIBLE]
----------------------------
Address:
----------------------------
----------------------------
Accepted and Agreed to:
Banc One Leasing Corporation
By: /s/ Xxxxxxx Xxxx
--------------------------------
Title: Funding Authority
------------------------------
Page 7
EXHIBIT A
Description of Collateral
All of the property of STB Systems, Inc. ("Debtor") described below, now or at
any time hereafter owned or acquired by Debtor, wherever located, whether in
possession of Debtor, warehousemen, bailees or any other person and whether
located on Debtor's premises or elsewhere and all replacements, substitutions,
attachments, accessions and additions to any such property of Debtor
(collectively, "Collateral"), together with whatever is received or receivable
when any of the Collateral is or proceeds thereof are sold, leased, collected,
exchanged or otherwise disposed of, whether such disposition is voluntary or
involuntary, including, without limitation, (a) all cash and non-cash proceeds
and products of any of the foregoing, including all monies and deposit accounts,
and (b) all accounts, chattel paper, instruments, general intangibles and rights
to payment of every kind now or at any time hereafter arising out of any such
sale, lease, collection, exchange or other disposition of any of the foregoing.
All equipment, tools, machinery, furnishings, furniture, and other goods
and fixtures (and all manufacturer's manuals and maintenance books and records
relating to any of the foregoing) and all improvements, replacements,
substitutions, attachments, accessions and additions thereto.
Page 8
EXHIBIT B
Permitted Locations of Collateral
0000 XXXXX XXXXXXXXX
XXXXX 000
XXXXXXXXXX, XX 00000
ONE CYPRESSWOOD BLDG.
9950 CYPRESSWOOD DR.
HOUSTON, TX
0000 X. XXXXXXXXX
XXXXX 000,000 XXX 000
XXXXXXXXXX, XX 00000
0000 XXXXXX XXXXX XX.
SUITE 250
EUGENE, OREGON 94701
00 XXXXXX XXXXX XXXX., XXXX 000
XX XXXX, XXXXX 00000
00000 XXXXXXX XXXXX #00X
XXXXXX, XX 00000
0000 XXXXXXXX
XXXXXXXXXX, XX 00000
0000 X. 0XX XXXXXX
XXXXX XXXX, XX 00000
Page 9
EXHIBIT C
Permitted Liens
Permitted Liens shall include only the security interests identified as
the 28 UCC financing statements described on Attachment #1 (consisting of 6
pages of a Capital Commerce Reporter, Inc. UCC lien search with an order date
of October 28, 1997), said Attachment #1 being attached hereto and made a
part hereof;
provided, that the security interest in favor of SANWA BUSINESS CREDIT
CORPORATION, Chicago, IL, identified by UCC filing # 236811 dated
December 16, 1993, as such UCC filing relates to the Collateral
described in the Security Agreement ("Banc One Security Agreement") to
which this Exhibit C is attached, must be released or subordinated
within 60 days of the date of the Banc One Security Agreement.
Permitted Liens Approved Only if Signed by Banc One Leasing:
Banc One Leasing Corporation
By: /s/ Xxxxxxx Xxxx
-------------------------------
Title: Funding Authority
----------------------------
Page 10
