EXHIBIT 10.40
LOAN AND SECURITY AGREEMENT
(equipment)
Loan Number: 1000111301
This Agreement is dated as of March 12, 2002 and is executed by and
between BANC ONE LEASING CORPORATION ("Lender"), with Lender's principal office
located at 0000 Xxxxxxx Xxxxxxx, Xxxxx X0 (XX0-0000), Xxxxxxxx, Xxxx 00000 and
the borrower identified below ("Borrower"):
Borrower: PANELVIEW, INCORPORATED
Borrower's Address: 00000 XXXXXXXXX XX., XXXXXXXX, XX 00000
1. GRANT OF SECURITY INTEREST. Borrower grants, pledges and assigns to
Lender a security interest in all of Borrower's respective right, title and
interest in and to the property described on the ATTACHED SCHEDULE A-1, 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 (the "Equipment"), in all 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
("Collateral"). This Agreement secures the prompt payment and complete
performance in full when due, whether at the stated maturity, by acceleration or
otherwise, of all payment and other obligations of Borrower under or in
connection with this Agreement, the Business Purpose Promissory Note executed in
connection with the Loan Number referenced above with Borrower as the maker (the
"Note"), and any and all renewals, extensions or substitutions therefor, and
also any and all other liabilities of Borrower to Lender, or any affiliate of
either Lender or Bank One Corporation, direct or indirect, absolute or
contingent, due or to become due, now existing or hereafter arising, and without
limitation, all indebtedness, leases, debts and liabilities (including
principal, interest, late charges, collection costs, attorney fees and the like)
("Obligations"). The absence 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. Borrower 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 except for the security interest created
by this Agreement and/or any other prior security agreement delivered by
Borrower to Lender. Except as previously disclosed to Lender in writing, 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 Lender. At its sole expense, Borrower
shall protect and defend Lender's first priority security interest in the
Collateral against all claims and demands whatsoever.
2. MAINTENANCE AND USE. At its sole expense, Borrower shall: (a) repair
and maintain the Equipment in good condition and working order and supply and
install all replacement parts or other devices when required to so maintain the
Equipment or when required by applicable law or regulation, which parts or
devices shall automatically become part of the Equipment; (b) use and operate
the Equipment 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
Equipment, and obtain all permits or licenses necessary to install, use or
operate the Equipment; and (c) make no alterations, additions, subtractions,
upgrades or improvements to the Equipment without Lender's prior written
consent, but any such alterations, additions, upgrades or improvements shall
automatically become part of the Equipment. The Equipment will not be used or
located outside of the United States. The Equipment shall not be removed from
the location set forth in the Schedule A-1 without Lender's prior written
consent. Lender has the right upon reasonable notice to Borrower to inspect the
Equipment wherever located.
3. INSURANCE. At its sole expense, Borrower at all times shall keep
each item of Equipment 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 Financed Amount (as defined in Section 19 hereof) for such item of
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Equipment. All insurers shall be reasonably satisfactory to Lender. Borrower
shall deliver to Lender satisfactory evidence of such coverage. Proceeds of any
insurance covering damage or loss of the Equipment shall be payable to Lender as
loss payee and shall, at Lender's option, be applied toward (a) the replacement,
restoration or repair of the Equipment, or (b) payment of the obligations of
Borrower under this Agreement. If an event of default occurs and is continuing,
or if Borrower fails to make timely payments due under Section 4 hereof, then
Borrower automatically appoints Lender as Borrower's attorney-in-fact with full
power and authority in the place of Borrower and in the name of Borrower or
Lender 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 Lender at least 30 days
prior written notice of any cancellation of such policy and will require that
Lender's interests remain insured regardless of any act, error, omission,
neglect or misrepresentation of Borrower. The insurance maintained by Borrower
shall be primary without any right of contribution from insurance which may be
maintained by Lender.
4. LOSS OR DAMAGE. Borrower bears the entire risk of loss, theft,
damage or destruction of Equipment in whole or in part from any reason
whatsoever ("Casualty Loss"). No Casualty Loss to Equipment shall relieve
Borrower from the obligation to pay the installment payments or from any other
obligation under this Agreement. In the event of Casualty Loss to any item of
Equipment, Borrower shall immediately notify Lender of the same and Borrower
shall, if so directed by Lender, immediately repair the same. If Lender
determines that any item of Equipment has suffered a Casualty Loss beyond repair
("Lost Equipment"), then Borrower, at the option of Lender, shall: (1)
immediately replace the Lost Equipment with similar equipment in good repair,
condition and working order free and clear of any Liens and deliver to Lender a
xxxx of sale covering the replacement equipment, in which event such replacement
equipment shall automatically be Equipment under this Agreement; or (2) on the
installment payment due date which is at least 30 but no more than 60 days after
the date of the Casualty Loss, pay to Lender all amounts then due and payable by
Borrower under this Agreement for the Lost Equipment plus the remaining
principal balance for such Lost Equipment as of the date of the Casualty Loss as
determined by Lender's records. Upon payment by Borrower of all amounts due
under the above clause (2), the security interest of the Lender in the Lost
Equipment will terminate.
5. TAXES. Borrower will pay promptly when due all taxes, assessments
and governmental charges upon or against Borrower, the Collateral or the
property or operations of Borrower, 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.
6. GENERAL INDEMNITY. Borrower assumes all risk and liability for, and
shall defend, indemnify and keep Lender harmless on an after-tax basis from, any
and all liabilities, obligations, losses, damages, penalties, claims, actions,
suits, costs and expenses, including reasonable attorney fees and expenses, of
whatsoever kind and nature imposed on, incurred by or asserted against Lender,
in any way relating to or arising out of the manufacture, purchase, acceptance,
rejection, ownership, possession, use, selection, delivery, operation,
condition, sale, return or other disposition of the Equipment or any part
thereof (including, without limitation, any claim for latent or other defects,
whether or not discoverable by Borrower or any other person, any claim for
negligence, tort or strict liability, any claim under any environmental
protection or hazardous waste law and any claim for patent, trademark or
copyright infringement). Borrower will not indemnify Lender under this section
for loss or liability caused directly and solely by the gross negligence or
willful misconduct of Lender. In this section, "Lender" also includes any
director, officer, employee, agent, successor or assign of Lender. Borrower's
obligations under this section shall survive the expiration, cancellation or
termination of this Agreement.
7. PERSONAL PROPERTY. Borrower represents and agrees that the Equipment
is, and shall at all times remain, separately identifiable personal property.
Upon Lender's request, Borrower shall furnish Lender a landlord's and/or
mortgagee's waiver and consent to remove all Equipment. Lender may display
notice of its interest in the Equipment by any reasonable identification.
Borrower shall not alter or deface any such indicia of Lender's interest.
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8. FINANCIAL REPORTS. Borrower agrees to furnish to Lender: (a) annual
financial statements setting forth the financial condition and results of
operation of Borrower (financial statements shall include balance sheet, income
statement and changes in financial position and all notes thereto) within 120
days of the end of each fiscal year of Borrower; (b) quarterly financial
statements setting forth the financial condition and results of operation of
Borrower within 60 days of the end of each of the first three fiscal quarters of
Borrower; and (c) such other financial information as Lender may from time to
time reasonably request including, without limitation, financial reports filed
by Borrower with federal or state regulatory agencies. All such financial
information shall be prepared in accordance with generally accepted accounting
principles. If Borrower fails to furnish the annual financial statements to
Lender within 30 days of Lender's written request, then Lender may, at its
option, charge Borrower a non-performance fee equal to all the installment
payments due under this Agreement for the then current month (unless otherwise
prohibited by law) and such fees shall be payable by Borrower on demand.
9. NO CHANGES IN BORROWER. Borrower shall not: (a) liquidate, dissolve
or suspend business; (b) sell, transfer or otherwise dispose of all or a
majority of its assets, except that Borrower may sell its inventory in the
ordinary course of its business; (c) enter into any merger, consolidation or
similar reorganization unless it is the surviving corporation; (d) transfer all,
or any substantial part of, its operations or assets outside of the United
States of America; or (e) without 30 days advance written notice to Lender,
change its name or chief place of business. Borrower shall at all times maintain
a tangible net worth which is no less than the greater of 75% of its tangible
net worth as of the date of this Agreement or 75% of its highest tangible net
worth thereafter.
10. REPRESENTATIONS. Borrower represents and warrants that: (a)
Borrower is a duly organized, legally existing and in good standing under the
laws of the state of its organization and is qualified to do business in and is
in good standing under the laws of each other state in which it conducts its
business and in which the Equipment is located; (b) Borrower has the power and
is duly authorized to enter into this Agreement and the Note, and to execute and
deliver to Lender, now and from time to time hereafter, additional instruments,
resolutions, agreements and other instruments or documents relating to the
Obligation owed to Lender; (c) Borrower has, by proper action, authorized and
empowered those persons whose signatures appear in this Agreement, the Note, and
any instruments, documents and exhibits that have been delivered in connection
herewith, to execute the same for and on its behalf; (d) this Agreement, the
Note, and each related document constitutes a legal, valid, and binding
obligation of Borrower enforceable in accordance with its terms; and (e) this
Agreement and the Note evidence a loan made primarily for business, commercial
or agricultural purposes and not primarily for personal, family, or household
purposes.
11. OTHER DOCUMENTS; EXPENSES; APPOINTMENT OF ATTORNEY-IN-FACT.
Borrower hereby irrevocably appoints Lender or its designee as Borrower's
attorney in fact, with full authority in the place instead of Borrower, from
time to time in Lender's discretion prior to, upon, during, and after an event
of default, to take any action and to execute any instrument which Lender 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, including without limitation to
prepare, sign, amend, file, or record a Uniform Commercial Code financing
statement in the place of Borrower and in the name of Borrower; (b) to ask,
demand, collect or xxx 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 Lender may deem
necessary or desirable for the collection of any Collateral or otherwise to
enforce the rights of Lender in the Collateral. Borrower agrees to sign and
deliver to Lender any additional documents deemed desirable by Lender to effect
the terms of this Agreement. Borrower shall pay upon Lender's request any
out-of-pocket costs and expense paid or incurred by Lender in connection with
the above terms of this Agreement or the funding and closing of this Agreement.
12. EVENTS OF DEFAULT. Each of the following events shall constitute an
event of default under this Agreement and the Note: (a) Borrower fails to pay
any installment payment or other amount due under this Agreement or the Note
within ten days of its due date; or (b) Borrower fails to perform or observe any
of its
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obligations in Sections 3, 9, or 18 hereof; or (c) Borrower fails to perform or
observe any of its other obligations in this Agreement or the Note within 30
days after Lender notifies Borrower of such failure; or (d) Borrower or any
Borrower affiliate defaults in the payment, performance or observance of any
obligation under any other loan, credit agreement or lease in which Lender or
any subsidiary (direct or indirect) of Bank One Corporation (or its successors
or assigns) is the creditor or lessor; or (e) any statement, representation or
warranty made by Borrower in this Agreement or in any document, certificate or
financial statement in connection with this Agreement proves at any time to have
been untrue or misleading in any material respect as of the time when made; or
(f) Borrower becomes insolvent or bankrupt, or Borrower admits its inability to
pay its debts as they mature, or Borrower makes an assignment for the benefit of
creditors, or Borrower applies for, institutes or consents to the appointment of
a receiver, trustee or similar official for Borrower or any substantial part of
its property or any such official is appointed without Borrower's consent, or
Borrower applies for, institutes or consents to any bankruptcy, insolvency,
reorganization, debt moratorium, liquidation or similar proceeding relating to
Borrower or any substantial part of its property under the laws of any
jurisdiction or any such proceeding is instituted against Borrower without stay
or dismissal for more than 30 days, or Borrower commences any act amounting to a
business failure or a winding up of its affairs, or Borrower ceases to do
business as a going concern; or (g) with respect to any guaranty, letter of
credit, pledge agreement, security agreement, mortgage, deed of trust, debt
subordination agreement or other credit enhancement or credit support agreement
(whether now existing or hereafter arising) signed or issued by any party in
connection with all or any part of Borrower's obligations under this Agreement,
the party signing or issuing any such agreement defaults in its obligations
thereunder or any such agreement shall cease to be in full force and effect or
shall be declared to be null, void, invalid or unenforceable by the party
signing or issuing it; or (h) there shall occur in Lender's reasonable opinion
any material adverse change in the financial condition, business or operations
of Borrower.
As used in this section 12, the term "Borrower" also includes any
guarantor (whether now existing or hereafter arising) of all or any part of
Borrower's obligations under this Agreement and/or any issuer of a letter of
credit (whether now existing or hereafter arising) relating to all or any part
of Borrower's obligations under this Agreement, and the term "Agreement" also
includes any guaranty or letter of credit (whether now existing or hereafter
arising) relating to all or any part of Borrower's obligations under this
Agreement.
13. RIGHTS UPON DEFAULT. If any event of default exists, Lender may
exercise in any order one or more of the remedies described in the lettered
subparagraphs of this section, and Borrower shall perform its obligations
imposed thereby:
(a) Lender may require Borrower to turnover any and all Collateral to
Lender.
(b) Lender or its agent may repossess any or all Collateral wherever
found, may enter the premises where the Collateral is located and disconnect,
render unusable and remove it, and may use such premises without charge to store
or show the Collateral for sale.
(c) Lender may sell any or all Collateral at public or private sale,
with or without advertisement or publication, may lease or otherwise dispose of
it or may use, hold or keep it.
(d) Lender may require Borrower to pay to Lender on a date specified by
Lender, (i) all accrued and unpaid interest, late charges and other amounts due
under the Note or this Agreement as of such date, plus (ii) the remaining
principal balance of the Note as of such date, plus (iii) interest at the
Overdue Rate on the total of the foregoing ("Overdue Rate" means an interest
rate per annum equal to the higher of 18% or 2% over the Prime Rate, but not to
exceed the highest rate permitted by applicable law). If an event of default
under section 12(f) of this Agreement exists, then Borrower will be
automatically liable to pay Lender the foregoing amounts as of the next
installment payment date under the Note unless Lender otherwise elects in
writing.
(e) Borrower shall pay all costs, expenses and damages incurred by
Lender because of the event of default or its actions under this section,
including, without limitation any collection agency and/or attorney fees
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and expenses, any costs related to the repossession, safekeeping, storage,
repair, reconditioning or disposition of the Collateral and any incidental and
consequential damages.
(f) Lender may xxx to enforce Borrower's performance of its obligations
under the Note and this Agreement and/or may exercise any other right or remedy
then available to Lender at law or in equity.
Lender is not required to take any legal process or give Borrower any
notice before exercising any of the above remedies. If Lender is required to
give notice, 10 calendar days advanced notice is reasonable notification. None
of the above remedies is exclusive, but each is cumulative and in addition to
any other remedy available to Lender. Lender's exercise of one or more remedies
shall not preclude its exercise of any other remedy. No action taken by Lender
shall release Borrower from any of its obligations to Lender. No delay or
failure on the part of Lender to exercise any right hereunder shall operate as a
waiver thereof, nor as an acquiescence in any default, nor shall any single or
partial exercise of any right preclude any other exercise thereof or the
exercise of any other right. After any default, Lender's acceptance of any
payment by Borrower under the Note or this Agreement shall not constitute a
waiver by Lender of such default, regardless of Lender's knowledge or lack of
knowledge at the time of such payment, and shall not constitute a reinstatement
of the Note or this Agreement if this Agreement has been declared in default by
Lender, unless Lender has agreed in writing to reinstate this Agreement and to
waive the default. With respect to any Collateral or any Obligation, Borrower
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 Lender may deem
advisable.
If Lender actually repossesses any Collateral, then it will use
commercially reasonable efforts under the then current circumstances to attempt
to mitigate its damages; provided, that Lender shall not be required to sell,
lease or otherwise dispose of any Collateral prior to Lender enforcing any of
the remedies described above. Lender may sell or lease the Collateral in any
manner it chooses, free and clear of any claims or rights of Borrower and
without any duty to account to Borrower with respect thereto except as provided
below. If Lender actually sells or leases the Collateral, it will credit the net
proceeds of any sale of the Collateral, or the net present value (discounted at
the then current Prime Rate) of the rents payable under any new lease of the
Collateral, against the amounts Borrower owes Lender. The term "net" as used
above shall mean such amount after deducting the costs and expenses described in
clause (e) above of this section. Borrower shall remain liable for any
deficiency if the net proceeds are insufficient to pay all amounts to which
Lender is entitled hereunder.
14. LATE CHARGES. If any installment payment or other amount payable
under the Note or this Agreement is not paid when due, then as compensation for
the administration and enforcement of Borrower's obligation to make timely
payments, Borrower shall pay with respect to each overdue payment on demand an
amount equal to the greater of fifteen dollars ($15.00) or five percent (5%) of
the each overdue payment (but not to exceed the highest late charge permitted by
applicable law) plus any collection agency fees and expenses.
15. LENDER'S RIGHT TO PERFORM. If Borrower fails to make any payment
under this Agreement or fails to perform any of its other obligations in this
Agreement (including, without limitation, its agreement to provide insurance
coverage), Lender may itself make such payment or perform such obligation, and
the amount of such payment and the amount of the expenses of Lender incurred in
connection with such payment or performance shall be deemed to be additional
principal under the Note which is payable by Borrower on demand.
16. NOTICES; POWER OF ATTORNEY. (a) Service of all notices under this
Agreement shall be sufficient if given personally or couriered or mailed to the
party involved at its respective address set forth herein or at such other
address as such party may provide in writing from time to time. Any such notice
mailed to such address shall be effective three days after deposit in the United
States mail with postage prepaid. (b) With respect to any power of attorney
covered by this Agreement, the powers conferred on Lender thereby:
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are powers coupled with an interest; are irrevocable; are solely to protect
Lender's interests under this Agreement; and do not impose any duty on Lender to
exercise such powers. Lender shall be accountable solely for amounts it actually
receives as a result of its exercise of such powers.
17. ASSIGNMENT BY LENDER. Lender and any assignee of Lender, with or
without notice to or consent of Borrower, may sell, assign, transfer or grant a
security interest in all or any part of Lender's rights, obligations, title or
interest in the Collateral, the Note, this Agreement, or the amounts payable
under the Note or this Agreement to any entity ("transferee"). The transferee
shall succeed to all of Lender's rights in respect to this Agreement (including,
without limitation, all rights to insurance and indemnity protection described
in this Agreement). Borrower agrees to sign any acknowledgment and other
documents reasonably requested by Lender or the transferee in connection with
any such transfer transaction. Borrower, upon receiving notice of any such
transfer transaction, shall comply with the terms and conditions thereof.
Borrower agrees that it shall not assert against any transferee any claim,
defense, setoff, deduction or counterclaim which Borrower may now or hereafter
be entitled to assert against Lender.
18. NO ASSIGNMENT OR LEASING BY BORROWER. BORROWER SHALL NOT, DIRECTLY
OR INDIRECTLY, (a) MORTGAGE, ASSIGN, SELL, TRANSFER, OR OTHERWISE DISPOSE OF
INTEREST IN THIS AGREEMENT OR THE COLLATERAL OR ANY PART THEREOF, OR (b) LEASE,
RENT, LEND OR TRANSFER POSSESSION OR USE OF THE EQUIPMENT OR ANY PART THEREOF TO
ANY PARTY, OR (c) CREATE, INCUR, GRANT, ASSUME OR ALLOW TO EXIST ANY LIEN ON ITS
INTEREST IN THIS AGREEMENT, THE COLLATERAL OR ANY PART THEREOF.
19. CERTAIN DEFINITIONS. "Financed Amount" for any item of Equipment
shall mean the amount set forth on the Schedule A-1 that corresponds to that
item of Equipment. "Lien" means any security interest, lien, mortgage, pledge,
encumbrance, judgment, execution, attachment, warrant, writ, levy, other
judicial process or claim of any nature whatsoever by or of any person. "Prime
Rate" means the prime rate of interest announced from time to time as the prime
rate by Bank One, NA (Columbus) or its successors or assigns; provided, that the
parties acknowledge that the Prime Rate is not intended to be the lowest rate of
interest charged by said bank in connection with extensions of credit. All terms
defined in the Lease are equally applicable to both the singular and plural form
of such terms.
20. CONDITIONS. Lender is not obligated to make any loan or disburse
any principal hereunder unless: (a) Lender has received the Note signed by the
Borrower; (b) Lender has received evidence of all required insurance; (c) in
Lender's sole judgement, there has been no material adverse change in the
financial condition or business of Borrower or any guarantor; (d) Borrower has
signed and delivered to Lender this Agreement and Lender has signed and accepted
this Agreement; (e) Lender has received the documents and instruments and
evidence as to satisfaction of the matters specified in any SCHEDULE 2 which may
be attached hereto, each of which shall be satisfactory to Lender in form and
substance and each document or instrument to be duly authorized, executed and
delivered and in full force and effect; (f) Lender has received, in form and
substance satisfactory to Lender, such other documents and information as Lender
shall reasonably request; and (g) Borrower has satisfied all other reasonable
conditions established by Lender.
21. USURY. It is not the intention of the parties to this Agreement to
make an agreement violative of the laws of any applicable jurisdiction relating
to usury ("Usury Laws"). Regardless of any provision in this Agreement, the
Note, or any document in connection therewith, Lender shall not be entitled to
receive, collect or apply, as interest on any Obligation, any amount in excess
of the Maximum Amount (the "Excess"). As used herein, "Maximum Amount" shall
mean the maximum amount of interest which would have accrued if the unpaid
principal amount of the Obligation outstanding from time to time had borne
interest each day at the maximum amount of interest which lender is permitted to
charge on the Obligation under the Usury Laws. If Lender ever receives, collects
or applies as interest any Excess, such Excess shall be deemed a partial
repayment of principal and treated hereunder as such; and if principal is paid
in full, any remaining Excess shall be paid to Borrower. In determining whether
or not the interest paid or payable under any specific contingency exceeds the
Maximum Amount, Borrower and Lender shall, to the maximum extent permitted under
the Usury Laws, (a) characterize any nonprincipal payment as an expense, fee or
premium rather than
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as interest, (b) exclude voluntary prepayments and the effect thereof, and (c)
amortize, prorate, allocate and spread in equal parts, the total amount of
interest throughout the entire contemplated term of the Obligation so that the
interest rate is uniform throughout the entire term of the Obligation; provided
that if the Obligation is paid and performed in full prior to the full
contemplated term thereof, and if the interest received for the actual period of
existence thereof exceeds the Maximum Amount, Lender shall refund to Borrower
the Excess, and, such event shall not be subject to any penalties provided by
the Usury Laws.
22. GOVERNING LAW. THE INTERPRETATION, CONSTRUCTION AND VALIDITY OF
THIS AGREEMENT AND THE NOTE SHALL BE GOVERNED BY THE LAWS OF THE STATE OF OHIO.
23. MISCELLANEOUS. (a) Subject to the limitations herein, this
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective heirs, administrators, successors and assigns. (b) This
Agreement may be executed in any number of counterparts, which together shall
constitute a single instrument. (c) Section and paragraph headings in this
Agreement are for convenience only and have no independent meaning. (d) The
terms of this Agreement shall be severable and if any term thereof is declared
unconscionable, invalid, illegal or void, in whole or in part, the decision so
holding shall not be construed as impairing the other terms of this Agreement
and this Agreement shall continue in full force and effect as if such invalid,
illegal, void or unconscionable term were not originally included herein. (e)
All indemnity obligations of Borrower under this Agreement and all rights,
benefits and protections provided to Lender by warranty disclaimers shall
survive the cancellation, expiration or termination of this Agreement. (f)
Lender shall not be liable to Borrower for any indirect, consequential or
special damages for any reason whatsoever. (g) This Agreement may be amended,
but only by a written amendment signed by Lender and Borrower. (h) If this
Agreement is signed by more than one Borrower, each of such Borrowers shall be
jointly and severally liable for payment and performance of all of Borrower's
obligations under this Agreement. (i) This Agreement represents the final,
complete and entire agreement between the parties hereto, and there are no oral
or unwritten agreements or understandings affecting this Agreement or the
Collateral. (j) Borrower agrees that Lender is not the agent of any manufacturer
or supplier, that no manufacturer or supplier is an agent of Lender, and that
any representation, warranty or agreement made by manufacturer, supplier or by
their employees, sales representatives or agents shall not be binding on Lender.
[The next page is the signature page.]
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ALL PARTIES TO THIS AGREEMENT, INCLUDING LENDER AND THE UNDERSIGNED, IRREVOCABLY
CONSENT TO THE JURISDICTION AND VENUE OF ANY STATE OR FEDERAL COURT IN 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 THE NOTE OR THIS AGREEMENT.
PANELVIEW, INCORPORATED
(Borrower)
By:
---------------------------------
Title:
------------------------------
Witness:
----------------------------
Accepted By:
BANC ONE LEASING CORPORATION
By:
---------------------------------
Title:
------------------------------
Acceptance Date:
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SCHEDULE 2
Attached to Loan and Security Agreement for Loan No. 1000111301
ADDITIONAL CONDITIONS TO FUNDING THE LOAN*
1. White Electronic Designs Corporation shall each execute and deliver to Lender
an absolute and unconditional guarantee of all obligations of Borrower under the
Loan and Security Agreement and the Note.
2. Lender shall receive UCC-3 terminations or release of liens in recordable
form from all creditors with a lien on any part of the Collateral as shown in
state or local lien records.
* The inclusion of additional funding conditions in this Schedule 2 shall not
limit the generality of the conditions set forth in the Agreement.
PANELVIEW, INCORPORATED
------------------------------
(Borrower)
By:
---------------------------------
Title:
------------------------------
