SECOND AMENDMENT TO AMENDED AND
RESTATED LETTER LOAN AGREEMENT AND
AMENDED AND RESTATED SECURITY AGREEMENT, AND
FIRST AMENDMENT TO REVOLVING NOTE
THIS SECOND AMENDMENT TO AMENDED AND RESTATED LETTER LOAN AGREEMENT AND AMENDED
AND RESTATED SECURITY AGREEMENT, AND FIRST AMENDMENT TO REVOLVING NOTE
("Amendment") is made and entered into effective the 28th day of May, 1996, by
and between ▇▇▇▇▇▇-▇▇▇▇▇▇, INC., a Texas corporation (herein called "Borrower"),
and BANK ONE, TEXAS, NA, with offices in Houston, Texas (herein called
"Lender").
R E C I T A L S:
WHEREAS, Borrower and Lender entered into, among other agreements, (i) an
Amended and Restated Letter Loan Agreement dated April 21, 1995 (as amended, the
"Loan Agreement"; the terms defined therein being used herein as therein defined
unless otherwise defined herein), (ii) a Master Revolving Credit Note of even
date with the Loan Agreement in the principal sum of $2,200,000.00 ("Revolving
Note"), and (iii) an Amended and Restated Security Agreement of even date with
the Loan Agreement (the "Security Agreement"); and
WHEREAS, Borrower and Lender entered into that certain First Amendment to
Amended and Restated Letter Loan Agreement, Promissory Note (Advancing Term) and
Amended and Restated Security Agreement dated effective September 21, 1995; and
WHEREAS, Borrower and Lender desire to (i) provide for a new $1,000,000.00
advancing term facility, (ii) extend the maturity date of the Revolving Note
from April 30, 1997 to April 30, 1998, and (iii) amend certain terms and
provisions of the Loan Agreement.
A G R E E M E N T:
NOW, THEREFORE, in consideration of the mutual promises herein contained
and other good and valuable consideration, the receipt of which is hereby
acknowledged, Borrower and Lender hereby agree to amend the Loan Agreement, the
Revolving Note and the Security Agreement as hereinafter set forth.
1. Amendments to Loan Agreement. The Loan Agreement is, effective the
date hereof, and subject to the satisfaction of the conditions precedent set
forth in Section 4 hereof, hereby amended as follows:
(a) The introductory paragraph of the Loan Agreement is hereby deleted
and replaced with the following:
"The undersigned, ▇▇▇▇▇▇-▇▇▇▇▇▇, Inc., a Texas corporation ("Borrower"), duly
organized and existing under the laws of the State of Texas, has requested that
Bank One, Texas, NA ("Lender") make a loan to Borrower. Lender has advised
Borrower that Lender is willing to make such loan to Borrower upon the terms and
subject to the conditions set forth in this letter loan agreement (the
"Agreement"). In consideration for the above premises and the mutual promises
and covenants herein contained, Borrower and Lender do hereby agree as follows:"
(b) Paragraph 1 of the Loan Agreement is hereby deleted and replaced with
the following:
"1. Loans. On the terms and subject to the conditions hereinafter set forth,
Lender agrees to lend to Borrower, a sum evidenced by the below described
promissory notes (the "Loans"). The Loans shall be evidenced by (i) a Master
Revolving Credit Note (the "Revolving Note") in a form satisfactory to Lender,
duly executed by Borrower in the principal amount of $2,200,000.00 and made
payable to the order of Lender, (ii) a Term Promissory Note (the "Real Estate
Note") in a form satisfactory to Lender, duly executed by Borrower in the
principal amount of $488,604.20 as of January 29, 1990 as evidenced by an
assignment to Lender from Texas Commerce Bank-Fort Worth ("TCB"), of an existing
promissory note from Borrower, payable to the order of TCB in the original face
amount of $575,000.00, (iii) a Term Promissory Note (the "Central Parkway Note")
in a form satisfactory to Lender, duly executed by Borrower in the principal
amount of $1,879,214.00 as of May 20, 1991 as evidenced by an assignment to
Lender from Keystone International, Inc. ("Keystone"), of an existing promissory
note from Borrower, payable to the order of Keystone in the original face amount
of $2,000,000.00, (iv) an Advancing Term Promissory Note (the "Equipment Note")
in a form satisfactory to Lender, duly executed by Borrower in the original
principal amount of $1,000,000.00 and payable to the order of Lender, which
Equipment Note has been subsequently increased to a principal amount of
$1,500,000, and (v) an Advancing Term Promissory Note (the "Second Equipment
Note") in a form satisfactory to Lender, duly executed by Borrower in the
principal amount of $1,000,000.00 and payable to the order of Lender. The Real
Estate Note, the Revolving Note, the Central Parkway Note, the Equipment Note,
and the Second Equipment Note, and any renewals and extensions thereof, are
collectively referred to as the "Notes". Principal and interest on each of the
Notes shall be due and payable in the manner and at the times set forth in such
Notes."
(c) Subparagraph 2(d) is hereby added to the Loan Agreement as follows:
"(d) Subject to the terms hereof, Lender will lend to Borrower an aggregate
amount not to exceed $1,000,000.00 to be used for Borrower's equipment
purchases. From time to time, Borrower may submit to Lender requests for
advances under the Second Equipment Note, which requests shall specify the
aggregate amount of the advance and the date of such advance. Borrower shall be
entitled only to an advance under the Second Equipment Note in an amount
approved by Lender, and in no event shall any such advance exceed Borrower's
actual cost of any such purchased equipment. Borrower shall furnish to Lender a
request for borrowing in a form satisfactory to Lender and a copy of the invoice
for the assets to be purchased, at least two (2) business days prior to the
requested borrowing date. Lender shall make the requested funds available to
Borrower at Lender's principal banking office in Houston, Texas. In connection
with advances, Lender shall not be obligated to make any advances under the
Second Equipment Note after April 30, 1997. Borrower shall not be entitled to
reborrow any sums already repaid under the Second Equipment Note."
(d) The reference to "$4,900,000" as Borrower's minimum Tangible Net Worth
in paragraph 6(c) of the Loan Agreement is hereby deleted and replaced with
"$5,000,000".
2. Amendments to Revolving Note. The Revolving Note is, effective the
date hereof, and subject to the satisfaction of the conditions precedent set
forth in Section 4 hereof, hereby amended as follows:
(a) The first grammatical paragraph on page two of the Revolving Note
dated April 21, 1995 is, effective the date hereof, amended by deleting the
reference to "April 30, 1997" and substituting "April 30, 1998" therefor.
(b) Upon the effective date hereof, Lender shall be authorized to endorse
on the Revolving Note the following legend or a legend of similar effect:
"The final maturity set forth in this Note has been extended until April 30,
1998, pursuant to a Second Amendment to Amended and Restated Letter Loan
Agreement and Amended and Restated Security Agreement and First Amendment to
Revolving Note, dated as of May 28, 1996 amending, among other things, the Loan
Agreement referred to in this Note."
3. Amendment to Security Agreement. The Security Agreement is, effective
the date hereof, and subject to the satisfaction of the conditions precedent set
forth in Section 4 hereof, hereby amended as follows:
(a) Section 1.2 of the Security Agreement is hereby deleted and replaced
with the following:
"1.2 Obligations. The security interest granted hereby is to secure the
payment of (i) a Master Revolving Credit Note executed by Debtor in the
principal amount of $2,200,000.00 and made payable to the order of Secured
Party, and any and all extensions, renewals and rearrangements thereof, (ii) a
Term Promissory Note executed by Debtor in the principal amount of $488,604.20
as of January 29, 1990 and made payable to the order of Texas Commerce Bank-Fort
Worth, and subsequently assigned to Secured Party, and any and all extensions,
renewals and rearrangements thereof, (iii) a Term Promissory Note executed by
Debtor in the principal amount of $1,879,214.00 and made payable to the order of
Keystone International, Inc., and subsequently assigned to Secured Party, and
any and all extensions, renewals and rearrangements thereof, (iv) an Advancing
Term Promissory Note duly executed by Debtor in the original principal amount of
$1,000,000.00 and made payable to the order of Secured Party, the principal
amount of which has subsequently been increased to $1,500,000, and any and all
extensions, renewals and rearrangements thereof, (v) an Advancing Term
Promissory Note duly executed by Debtor in the principal amount of $1,000,000.00
and made payable to the order of Secured Party, and any and all extensions,
renewals and rearrangements thereof, and (vi) any and all other indebtedness and
liabilities whatsoever of Debtor to Secured Party whether direct or indirect,
absolute or contingent, due or to become due and whether now existing or
hereafter arising and howsoever evidenced or acquired, whether joint or several
(all of which are hereinafter sometimes called the "Obligations"). Debtor
acknowledges that the security interest hereby granted shall secure all future
advances as well as any other obligations and liabilities of Debtor to Secured
Party whether now in existence or hereafter arising."
4. Conditions of Effectiveness. This Amendment shall become effective
when, and only when, Lender shall have received counterparts of this Amendment
executed by Borrower and Sections 1, 2 and 3 hereof shall become effective when,
and only when, Lender shall have additionally received all of the following
documents:
(a) Sixth Modification of Note and Liens executed by Borrower;
(b) Second Supplemental Deed of Trust executed by Borrower;
(c) Certificates of the Boards of Directors of Borrower authorizing the
execution, delivery and performance of this Amendment, and the matters
contemplated hereby; and
(d) Any other instruments or documents as may be required by Lender.
5. Representations and Warranties of Borrower. Borrower represents and
warrants as follows:
(a) Borrower is duly authorized and empowered to execute, deliver and
perform this Amendment and all other instruments referred to or mentioned herein
to which it is a party, and all action on its part requisite for the due
execution, delivery and the performance of this Amendment has been duly and
effectively taken. This Amendment, when executed and delivered, will constitute
valid and binding obligations of Borrower enforceable in accordance with its
terms. This Amendment does not violate any provisions of Borrower's Articles of
Incorporation, By-Laws, or any contract, agreement, law or regulation to which
Borrower is subject, and does not require the consent or approval of any
regulatory authority or governmental body of the United States or any state.
(b) The representations and warranties made by Borrower in the Loan
Agreement are true and correct as of the date of this Amendment.
(c) No event has occurred and is continuing which constitutes an Event of
Default or would constitute an Event of Default but for the requirement that
notice be given or time elapse or both.
6. Reference to and Effect on the Security Instruments.
(a) Upon the effectiveness of Sections 1, 2 and 3 hereof, on and after the
date hereof each reference in the Loan Agreement to "this Agreement",
"hereunder", "hereof", "herein" or words of like import, and each reference in
the other Security Instruments (hereinafter defined) to the Loan Agreement,
shall mean and be a reference to the Loan Agreement as amended hereby.
(b) Except as specifically amended above, the Loan Agreement, the
Revolving Note, the Security Agreement, and all other instruments securing or
guaranteeing Borrower's obligations to Lender (the "Security Instruments") shall
remain in full force and effect and are hereby ratified and confirmed. Without
limiting the generality of the foregoing, the Security Instruments and all
collateral described therein do and shall continue to secure the payment of all
obligations of Borrower under the Loan Agreement and the Revolving Note, as
amended hereby, and under the other Security Instruments.
(c) The execution, delivery and effectiveness of this Amendment shall not,
except as expressly provided herein, operate as a waiver of any right, power or
remedy of Lender under any of the Security Instruments, nor constitute a waiver
of any provision of any of the Security Instruments.
7. Waiver. As additional consideration for the execution, delivery and
performance of this Amendment by the parties hereto and to induce Lender to
enter into this Amendment, Borrower warrants and represents to Lender that no
facts, events, statuses or conditions exist or have existed which, either now or
with the passage of time or giving of notice, or both, constitute or will
constitute a basis for any claim or cause of action against Lender or any
defense to (a) the payment of any obligations and indebtedness under the Notes
and/or the Security Instruments or (b) the performance of any of their
obligations with respect to the Notes and/or the Security Instruments, and in
the event any such facts, events, statuses or conditions exist or have existed,
Borrower unconditionally and irrevocably waives any and all claims and causes of
action against Lender and any defenses to their payment and performance
obligations in respect to the Notes and the Security Instruments.
8. Costs and Expenses. Borrower agrees to pay on demand all costs and
expenses of Lender in connection with the preparation, reproduction, execution
and delivery of this Amendment and the other instruments and documents to be
delivered hereunder, including the reasonable fees and out-of-pocket expenses of
counsel for Lender. In addition, Borrower shall pay any and all fees payable or
determined to be payable in connection with the execution and delivery, filing
or recording of this Amendment and the other instruments and documents to be
delivered hereunder, and agrees to save Lender harmless from and against any and
all liabilities with respect to or resulting from any delay in paying or
omission to pay such fees.
9. Execution in Counterparts. This Amendment may be executed in any
number of counterparts and by different parties hereto in separate counterparts,
each of which when so executed and delivered shall be deemed to be an original
and all of which taken together shall constitute but one and the same
instrument.
10. Governing Law. This Amendment shall be governed by and construed in
accordance with the laws of the State of Texas.
11. Final Agreement. THIS WRITTEN LOAN AGREEMENT REPRESENTS THE FINAL
AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
duly executed in multiple counterparts, each of which is an original instrument
for all purposes, all as of the day and year first above written.
LENDER: BORROWER:
BANK ONE, TEXAS, ▇▇ ▇▇▇▇▇▇-▇▇▇▇▇▇, INC.
By:/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇ By:/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇,
Vice President Chairman of the Board of
Directors
PROMISSORY NOTE
(Advancing Term)
$1,000,000.00 Houston, Texas May 28, 1996
FOR VALUE RECEIVED, the undersigned, ▇▇▇▇▇▇-▇▇▇▇▇▇, INC., a Texas
corporation (hereinafter called the "Maker"), promises to pay to the order of
BANK ONE, TEXAS, NA, a national banking association (hereinafter called the
"Payee"), at its office located at ▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇, or
at such other place as the Payee may designate in writing to the Maker, in
lawful money of the United States of America, the principal sum of ONE MILLION
AND NO/100 DOLLARS ($1,000,000.00), or so much thereof that may be advanced and
outstanding pursuant to the hereinafter defined Loan Agreement, together with
interest thereon from the date hereof until maturity (determined on a daily
basis and for the actual number of days elapsed based on either a 365 or 366 day
year, as the case may be) at a fluctuating rate per annum equal to the lesser of
(i) the Base Rate in effect from day-to-day and (ii) the Maximum Rate. If at
any time and from time to time the rate of interest calculated pursuant to item
(i) above would exceed the Maximum Rate, thereby causing the interest payable
hereon to be limited to the Maximum Rate, then any subsequent reduction in the
rate specified in item (i) above shall not reduce the rate of interest hereon
below the Maximum Rate until the total amount of interest accrued hereon from
and after the date of the first advance hereunder equals the amount of interest
which would have accrued hereon if the rate specified in item (i) above had at
all times been in effect.
As used herein, the term "Base Rate" means, at any time, the rate of
interest per annum established from time to time by Payee. Without notice to
the Maker or any other person, the Base Rate shall change automatically from
time to time as and in the amount by which such Base Rate shall fluctuate, with
each such change to be effective as of the date of each change in such Base
Rate. The Base Rate is a reference rate and does not necessarily represent the
lowest or best rate actually charged to any customer. The Payee may make
commercial loans or other loans at rates of interest at, above or below the Base
Rate.
As used herein, the term "Maximum Rate" shall mean, with respect to the
holder hereof, the maximum nonusurious interest rate, if any, that at any time,
may be under applicable law contracted for, taken, reserved, charged or received
on the indebtedness evidenced by this Note. If applicable law ceases to provide
for such a maximum rate of interest, the Maximum Rate shall be equal to eighteen
percent (18%) per annum.
The principal of and all accrued but unpaid interest on this Note shall be
due and payable as follows:
Accrued interest hereon shall be due and payable in monthly installments as
it accrues, the first such installment becoming due and payable on or before
June 31, 1996, with a like installment being due and payable on or before the
last day of each succeeding calendar month thereafter until and including April
30, 1997 (the "Advancing Termination Date"). Thereafter, this Note shall be
due and payable in monthly installments of (i) all accrued and unpaid interest
hereon, plus (ii) a principal installment in an amount based on a sixty (60)
month equal amortization of the outstanding principal amount of this Note as of
the Advancing Termination Date; the first such installment becoming due and
payable on or before one month after the Advancing Termination Date, with a like
installment becoming due and payable on or before the same day of each of the
succeeding calendar months thereafter until April 30, 2002, when this Note,
including all outstanding principal and accrued, unpaid interest hereon shall be
fully and finally paid.
The Maker reserves the right to prepay this Note, in whole or in part, at
any time, without penalty or notice. All payments hereunder, whether designated
as payments of principal or interest, shall be applied: first to unpaid and
accrued interest; then to the discharge of any expenses or damages for which the
Payee may be entitled to receive reimbursement under the terms of this Note or
under the terms of any document executed in connection herewith; and, lastly, to
unpaid principal in the inverse order of maturity. Unless changed in accordance
with law, the applicable method of calculating the usury ceiling rate under
Texas law shall be the indicated (weekly) ceiling rate in effect and applicable
to the loan evidenced by this Note, as provided in Tex. Rev. Civ. Stat. ▇▇▇.
art. 5069-1.04, as amended; provided, that the Payee may also rely on alternate
maximum rates of interest under other applicable laws if they are higher. All
past due principal and interest on this Note, whether due as the result of
acceleration of maturity or otherwise, shall bear interest from the date the
payment thereof shall have become due until the same have been fully discharged
by payment at the Maximum Rate.
This Note has been executed and delivered pursuant to, and is subject to
certain terms and conditions in, that certain Amended and Restated Letter Loan
Agreement dated April 21, 1995, as previously amended and as amended by that
certain Second Amendment to Amended and Restated Letter Loan Agreement and
Amended and Restated Security Agreement and First Amendment to Revolving Note of
even date herewith (said Agreement as previously amended and as it may hereafter
be amended or modified from time to time being the "Loan Agreement", the terms
defined therein and not otherwise defined herein being used herein as therein
defined), and is the "Second Equipment Note" referred to therein. The Payee
shall be entitled to the benefits provided for in the Loan Agreement. Reference
is made to the Loan Agreement for the statement of any obligation of the Payee
to advance funds hereunder and the Events of Default (as defined therein) upon
which the maturity of this Note may be accelerated. The time of payment of this
Note is also subject to acceleration in the event the Maker defaults or
otherwise fails to discharge its obligations under any of the instruments
securing payment hereof.
In the Event of Default hereunder or under any of the instruments securing
payment hereof and the placing of this Note in the hands of an attorney for
collection (whether or not suit is filed), or if this Note is collected by suit
or legal proceedings or through the probate court or bankruptcy proceedings, the
Maker agrees to pay the holder hereof the costs and reasonable attorney's fees
incurred in the collection hereof.
As recited in Paragraph 10(e) of the Loan Agreement, which paragraph is
incorporated by reference herein, notwithstanding any provision herein to the
contrary, the Payee shall never be entitled to receive or collect interest
hereunder, nor shall or may amounts received hereunder be credited to interest
hereunder, so that the Payee shall receive or be paid interest exceeding the
maximum amount permitted by applicable law.
Any check, draft, money order or other instrument given in payment of all
or any portion hereof may be accepted by the holder hereof and handled in
collection in the customary manner, but the same shall not constitute payment
hereunder or diminish any rights of the holder hereof except to the extent that
actual cash proceeds of such instrument are unconditionally received by the
holder and applied to this indebtedness in the manner elsewhere herein provided.
It is further agreed that the Payee shall have a first lien on all deposits
and other sums at any time credited by or due from the Payee to any maker,
endorser, surety or guarantor hereof as collateral security for the payment of
this Note, and the Payee, at its option, may at any time, without notice and
without any liability, hold all or any part of any such deposits or other sums
until all sums owing on this Note have been paid in full and/or apply or set off
all or any part of any such deposits or other sums credited by or due from the
Payee to or against any sums due on this Note in any manner and in any order of
preference which the Payee, in its sole discretion, chooses.
The loan evidenced by this Note was negotiated and consummated in the State
of Texas and it is agreed and understood that the legality, enforceability and
construction hereof shall be governed by Texas law and, to the extent
applicable, by the laws of the United States of America. The Maker and the
Payee expressly agree, pursuant to Article 15.10(b) of Chapter 15 ("Chapter 15")
of the Texas Credit Code, that Chapter 15 shall not apply to this Note or to any
advance evidenced by this Note and that this Note and all such advances shall
not be governed by or subject to the provisions of Chapter 15 in any manner
whatsoever.
This Note is secured by (i) a Supplemental Deed of Trust of even date
herewith executed by the Maker for the benefit of the Payee covering the
property described therein, given to supplement that certain Deed of Trust dated
January 29, 1988 executed by the Maker for the benefit of Keystone
International, Inc. ("Keystone") and filed for record in the Official Public
Records of Real Property of ▇▇▇▇▇▇ County, Texas under Clerk's File No. L524904,
and subsequently transferred and assigned by Keystone to the Payee by Transfer
of Note and Liens dated May 20, 1991, filed for record in the Official Public
Records of Real Property of ▇▇▇▇▇▇ County, Texas, under Clerk's File No.
N191393, and (ii) an Amended and Restated Security Agreement dated April 21,
1995 executed by the Maker to the Payee.
THIS WRITTEN LOAN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES.
▇▇▇▇▇▇-▇▇▇▇▇▇, INC.
By:/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Chairman
of the Board of Directors
SECOND SUPPLEMENTAL DEED OF TRUST
THE STATE OF TEXAS )
) KNOW ALL PERSONS BY THESE PRESENTS:
COUNTY OF ▇▇▇▇▇▇ )
THIS SECOND SUPPLEMENTAL DEED OF TRUST is entered into effective as of May
28, 1996, by and between BANK ONE TEXAS, NA, a national banking association
(herein called "Lender"), and ▇▇▇▇▇▇-▇▇▇▇▇▇, INC., a Texas corporation (herein
called "Borrower").
RECITALS:
1. Borrower made, executed and delivered that certain Promissory Note
(herein called the "Original Note") dated January 29, 1988, in the original
principal sum of Two Million and No/100 Dollars ($2,000,000.00), payable to the
order of Keystone International, Inc., a Texas corporation ("Keystone"), as
therein provided, said Original Note being secured in part by a Deed of Trust
(the "Deed of Trust") of even date therewith, executed by Borrower to W. ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, as Trustee ("Trustee") for the benefit of Keystone and filed for
record in the Official Public Records of Real Property of ▇▇▇▇▇▇ County, Texas
under Clerk's File No. L524904, covering the property (the "Property"), more
fully described on Exhibit "A" annexed hereto. The Deed of Trust, and any other
instruments securing or guaranteeing the Original Note are herein called the
"Security Documents".
2. The Original Note and liens securing same were transferred and assigned
from Keystone to Lender by that certain Transfer of Note and Liens dated May 20,
1991, which was filed for record in the Official Public Records of Real Property
of ▇▇▇▇▇▇ County, Texas, under Clerk's File No. N191393 and, thereafter,
modified by the terms of a Modification, Renewal and Extension of Note and Liens
dated May 21, 1991, which was filed for record in the Official Public Records of
Real Property of ▇▇▇▇▇▇ County, Texas, under Clerk's File No. N191391, pursuant
to the terms of a Second Amendment to Letter Loan Agreement dated May 21, 1991,
which has been amended by a Third Amendment to Letter Loan Agreement dated May
24, ▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ to Letter Loan Agreement dated April 30, 1993, Fifth
Amendment to Letter Loan Agreement dated May 21, 1993 and Sixth Amendment to
Letter Loan Agreement dated April 30, 1994.
3. Borrower and Lender executed that certain Amended and Restated Letter
Loan Agreement dated April 21, 1995, pursuant to which Lender provided Borrower
with an additional loan facility in the original principal amount of One Million
and No/100 Dollars ($1,000,000.00) (the "Equipment Loan") evidenced by an
Advancing Term Promissory Note of even date therewith, and secured by, among
other things, a Supplemental Deed of Trust executed by Borrower in favor of
Lender, filed for record under Clerk's File No. R424607 in the Official Public
Records of Real Property of ▇▇▇▇▇▇ County, Texas, said Amended and Restated
Letter Loan Agreement having been amended by that certain First Amendment to
Amended and Restated Letter Loan Agreement, Promissory Note (Advancing Term) and
Amended and Restated Security Agreement dated September 21, 1995, and the
principal amount of the Equipment Loan was increased to $1,500,000 by the terms
of a Modification of Note and Liens dated September 21, 1995.
4. Borrower has of this date entered into a Second Amendment to Amended
and Restated Letter Loan Agreement and Amended and Restated Security Agreement
and First Amendment to Revolving Note with Lender, whereby Lender has agreed,
subject to the terms and conditions thereof, to provide Borrower with an
additional loan facility in the amount of One Million and No/100 Dollars
($1,000,000.00) (the "Second Equipment Loan"), to be evidenced by an Advancing
Term Promissory Note of even date herewith, provided, among other things,
Borrower supplements the Deed of Trust to include the Second Equipment Loan as
being secured by the liens granted in the Deed of Trust.
5. Borrower has agreed to supplement the Deed of Trust as provided
hereinbelow.
A G R E E M E N T:
1. NOW, THEREFORE, Borrower, in consideration of Ten And No/100 Dollars
($10.00) and other good and valuable consideration in hand paid, the receipt and
sufficiency of which are hereby acknowledged, has GRANTED, BARGAINED, SOLD and
CONVEYED and by these presents does GRANT, BARGAIN, SELL and CONVEY unto
Trustee, the Property. TO HAVE AND TO HOLD THE PROPERTY, together with all and
singular the rights, privileges, hereditaments and appurtenances thereto and in
anywise incident, appertaining or belonging unto Trustee, and his successors or
substitutes forever; and Borrower hereby binds itself, its successors and
assigns, to warrant and forever defend title to the Property unto Trustee, his
successors, substitutes and assigns, against every person whomsoever lawfully
claiming or to claim the same or any part thereof.
2. This conveyance is made in trust to secure and enforce the payment of
the Second Equipment Loan, and the Security Documents shall be from and after
this date deemed modified as necessary to secure the Second Equipment Loan.
Henceforth, the term "said indebtedness" as defined in the Deed of Trust shall
include the Second Equipment Loan, as well as all renewals, extensions,
modifications and rearrangements thereof.
3. As supplemented hereby, the Borrower hereby reaffirms all covenants,
representations and warranties made in the Deed of Trust and Borrower hereby
agrees that all of the terms and conditions thereof are incorporated herein by
this reference.
4. All terms, conditions and provisions contained in the Security
Documents, except as modified, restated (where applicable), or amended hereby,
shall continue and remain in full force and effect.
5. The Property shall be and remain in all respects subject to the lien,
charge or encumbrance of the Security Documents, as modified, and nothing herein
contained and nothing done pursuant hereto shall affect or be construed to
affect the lien, charge or encumbrance of the Security Documents, as modified,
or the priority thereof over any other liens, charges or encumbrances or to
release or affect the liability of any party or parties whomsoever who may now
or hereafter be liable under or on account of the Security Documents, as
amended, nor shall anything herein contained or done in pursuance hereof affect
or be construed to affect any other security for the said indebtedness, if any,
held by the Lender.
6. No renewal or extension of the time of payment of any part or all of
the Second Equipment Loan, no releases or surrender of any security for the
Second Equipment Loan, no release of any person primarily or secondarily liable
on the Second Equipment Loan (including any maker, endorser or guarantor), no
delay in enforcement of payment of the Second Equipment Loan, and no delay or
omission in exercising any right or power with respect to the Second Equipment
Loan, shall in any way or manner impair or affect the rights of the Lender
hereunder.
7. THIS WRITTEN LOAN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBJECT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS
BETWEEN THE PARTIES.
EXECUTED by each part on the date of its respective acknowledgment, but to
be effective for all purposes as of the date first above written.
"BORROWER"
▇▇▇▇▇▇-▇▇▇▇▇▇, INC.
By:/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇,
Chairman of the Board of
Directors
"LENDER"
BANK ONE, TEXAS, NA
By:/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇,
Vice President
SIXTH MODIFICATION OF NOTE AND LIENS
(Real Estate Note)
THE STATE OF TEXAS )
) KNOW ALL PERSONS BY THESE PRESENTS:
COUNTY OF ▇▇▇▇▇▇ )
THIS SIXTH MODIFICATION OF NOTE AND LIENS (herein called "Agreement") is
entered into effective as of May 28, 1996, by and between BANK ONE, TEXAS, NA,
successor in interest by merger with TEAM BANK (herein called "Lender"), and
▇▇▇▇▇▇-▇▇▇▇▇▇, INC., a Texas corporation, (herein called "Borrower").
W I T N E S S E T H:
WHEREAS, Borrower made, executed and delivered that certain Promissory Note
(herein called the "Note") dated September 22, 1987, in the original principal
sum of FIVE HUNDRED SEVENTY-FIVE THOUSAND AND NO/100 DOLLARS ($575,000.00)
payable to the order of TEXAS COMMERCE BANK OF FORT WORTH, TEXAS, which is now
known as Texas Commerce Bank National Association ("TCB"), as therein provided,
said Note being secured by a Deed of Trust, Security Agreement and Financing
Statement (the "Tarrant County Deed of Trust") of even date therewith, executed
by Borrower to ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇, Trustee for the benefit of TCB, and filed
for record in the Official Public Records of Real Property of Tarrant County,
Texas, under Clerk's File No. 594747 and corrected and re-recorded under Clerk's
File No. 602929, covering the property (the "Tarrant County Property") more
fully described therein; and
WHEREAS, the Note and liens were transferred and assigned from TCB to
Lender by that certain Transfer of Note and Liens dated to be effective January
29, 1990 and filed for record in the Official Public Records of Real Property of
Tarrant County, Texas under Vol. 09943, Page 0973; and
WHEREAS, Borrower made, executed and delivered that certain Modification,
Renewal and Extension of Note and Liens (the "▇▇▇▇▇▇ County Modification") dated
May 21, 1991, and filed for record in the Official Public Records of Real
Property of ▇▇▇▇▇▇ County, Texas, under Clerk's File No. N191391, wherein
Borrower and Lender agreed that the liens encumbering the property (the "▇▇▇▇▇▇
County Property") securing the indebtedness described therein, shall also secure
the Note; and
WHEREAS, the Note and Security Documents (hereinafter defined) were
modified, renewed and extended pursuant to the terms and conditions of a Second
Modification, Renewal and Extension of Note and Liens ("Second Modification")
dated March 24, 1992, and filed for record in the Official Public Records of
Real Property of Tarrant County, Texas under Vol. 10637, Page 1665 and in the
Official Public Records of Real Property of ▇▇▇▇▇▇ County, Texas, under Clerk's
File No. P001208; and
WHEREAS, the Note and Security Documents were modified, renewed and
extended pursuant to the terms and conditions of a Third Modification of Note
and Liens ("Third Modification") dated April 30, 1993, and filed for record in
the Official Public Records of Real Property of Tarrant County, Texas; and
WHEREAS, the Note and Security Documents were modified, renewed and
extended pursuant to the terms and conditions of a Fourth Modification of Note
and Liens ("Fourth Modification") dated April 30, 1994, and filed for record in
the Official Public Records of Real Property of ▇▇▇▇▇▇ County, Texas under
Clerk's File No. P924820, wherein Borrower requested, and Lender agreed, among
other things, to release the Tarrant County Property from the liens securing the
Tarrant County Deed of Trust; and
WHEREAS, the Note and Security Documents were most recently renewed and
extended pursuant to the terms and conditions of a Fifth Modification of Note
and Liens ("Fifth Modification") dated effective April 21, 1995, and filed for
record in the Official Public Records of Real Property of ▇▇▇▇▇▇ County, Texas
under Clerk's File No. L524904, wherein, among other things, the Security
Documents were amended to extend the Revolving Note; and
WHEREAS, Borrower has requested, and Lender has agreed, on the terms and
conditions set forth herein, to extend the term of the Revolving Note.
NOW, THEREFORE, in consideration of the mutual covenants, rights and
obligations contained herein, the benefits to be derived therefrom and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto do hereby agree and contract as follows:
1. Lender and Borrower hereby agree that the final maturity date of the
Revolving Note is extended from April 30, 1997 to April 30, 1998.
2. This Agreement is entered into in extension (and not in extinguishment,
substitution, novation or discharge) of the unpaid principal balance of the
Revolving Note. All liens, security interests and obligations securing and
guaranteeing payment of the Revolving Note, including without limitation the
▇▇▇▇▇▇ County Modification, the Second Modification, the Third Modification, the
Fourth Modification and the Fifth Modification (collectively the "Security
Documents") are hereby ratified, confirmed, renewed, extended and brought
forward as security for the payment hereunder.
3. The Security Documents are hereby amended to provide that the Notes
described therein shall mean (i) the Note, as previously modified, and (ii) the
Revolving Note as modified (with an extended maturity of April 30, 1998).
4. All other terms, conditions and provisions contained in the Revolving Note,
except as otherwise specifically set forth herein, shall continue and remain in
full force and effect.
5. All terms, conditions and provisions contained in the Security Documents,
except as modified, restated (where applicable), renewed and extended by the
documents referred to herein, shall continue and remain in full force and
effect.
6. This Agreement has been executed and delivered pursuant to, and is subject
to certain terms and conditions set forth in, that certain Second Amendment to
Amended and Restated Letter Loan Agreement and Amended and Restated Security
Agreement and First Amendment to Revolving Note of even date herewith (the "Loan
Agreement"), and the Revolving Note is the "Revolving Note" referred to therein.
The Lender shall be entitled to the benefits provided in the Loan Agreement.
Reference is made to the Loan Agreement for the Events of Default upon which the
maturity of the Revolving Note may be accelerated.
7. This Agreement shall be governed by and construed in accordance with the
laws of the State of Texas. If any provision of this Agreement or the
application thereof to any person or circumstances shall, for any reason and to
any extent, be invalid or unenforceable, neither the remainder of this
Agreement, nor the application of such provision to any other persons or
circumstances shall be affected thereby, but rather same shall be enforced to
the greatest extent permitted by law.
8. This Agreement, and all the terms, provisions and conditions hereof, shall
be binding upon each party hereto and such party's heirs, legal representatives,
successors and assigns.
9. This Agreement may be executed in multiple originals. This Agreement may
also be executed in multiple counterparts, and all so executed shall constitute
one agreement, binding on the parties hereto, notwithstanding that all parties
are not signatories to the original or the same counterpart.
10. This Agreement represents the entire understanding and agreement between
the parties hereto with respect to the subject matter hereof, supersedes all
prior negotiations, oral representations and writings between the parties, and
cannot be amended or supplemented orally, but only by an agreement in writing
signed by Lender. The Borrower certifies that it is relying on no
representation, warranty, covenant or agreement except for those set forth
herein.
11. THIS WRITTEN LOAN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES.
EXECUTED by each party on the date of its respective acknowledgment, but to
be effective for all purposes as of the date first above written.
"BORROWER"
▇▇▇▇▇▇-▇▇▇▇▇▇, INC.
By:/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇,
Chairman of the Board
"LENDER"
BANK ONE, TEXAS, NA
By:/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇,
Vice-President
▇▇▇▇▇▇-▇▇▇▇▇▇, INC.
Certificate
The undersigned hereby certifies that he is the duly elected and acting
Secretary of ▇▇▇▇▇▇-▇▇▇▇▇▇, INC., a Texas corporation (the "Company"), and as
such has custody of the corporate records of the Company and is authorized to
execute and deliver this Certificate on behalf of the Company; and with
reference to a loan being modified by BANK ONE, TEXAS, NA (the "Lender"), the
undersigned hereby further certifies as follows:
1. Attached hereto as Exhibit "A" is a full, true and correct copy of the
Resolutions duly adopted by the Board of Directors of the Company by a unanimous
written consent effective May 28, 1996, in accordance with the Texas Business
Corporation Act, and the Articles of Incorporation and Bylaws of the Company.
2. The Resolutions attached as Exhibit "A" hereto have not been amended,
modified or rescinded and are in full force and effect on the date hereof.
3. The undersigned officers have been duly elected to the positions set
forth next to their respective names below, and are qualified to act in such
capacities and execute documents on behalf of the Company, and the signature
appearing opposite each name is the authentic signature of each such officer.
Name Office Signature
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇ President /s/ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Chairman of the Board
and Chief Executive
Officer /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇ Secretary /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
4. The Company is duly organized and existing under the laws of the State
of Texas.
5. All franchise and other taxes required to maintain the Company's
existence have been paid and no such taxes are delinquent.
6. No proceedings are pending for the forfeiture of the Company's
authority to do business or to force its dissolution, voluntarily or
involuntarily.
7. There is no provision in the Articles of Incorporation or Bylaws of the
Company limiting the above-described resolutions, and said resolutions are in
conformity with the provisions of the Company's Articles of Incorporation and
Bylaws, and with the proceedings of the Board of Directors.
8. The Articles of Incorporation of the Company previously delivered to
the Lender are in full force and effect and have not been amended or modified,
except as may have been disclosed in writing to the Lender.
9. The Bylaws of the Company previously delivered to the Lender are in
full force and effect and have not been amended or modified except as may have
been disclosed in writing to the Lender.
EXECUTED the 28th day of May, 1996.
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇
----------------
▇▇▇▇ ▇▇▇▇▇▇▇, Secretary
The undersigned, the Chairman of the Board of the Company, hereby certifies
that ▇▇▇▇ ▇▇▇▇▇▇▇ is the Secretary of the Company and is authorized to execute
and deliver this Certificate for and on behalf of the Company.
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇,
Chairman of the Board
EXHIBIT "A"
WHEREAS, ▇▇▇▇▇▇-▇▇▇▇▇▇, INC. (the "Company") shall (i) renew and extend a
loan in the original principal amount of $2,200,000.00 and (ii) obtain a loan of
additional funds in the amount of $1,000,000.00 to be evidenced by a Promissory
Note (Advancing Term) of even date herewith (collectively, the "Loan") from BANK
ONE, TEXAS, NA (the "Lender"), pursuant to the terms of the Loan Agreement, as
amended;
RESOLVED, further, in regard to the Loan that any one of the President, the
Chairman of the Board of Directors, the Secretary, or the Chief Executive
Officer of the Company is hereby authorized and directed to execute and deliver,
for and on behalf of the Company, documents as may be deemed necessary or
desirable by such officers or required by the Lender in regard to the Loan; and
further
RESOLVED, that the drafts of such documents presented to the Board of
Directors of the Company are hereby approved; and further
RESOLVED, that the officers executing and delivering any of the above-
described documents are hereby authorized and empowered to execute and deliver
the same in the name and on behalf of the Company, and in such manner of
counterparts as the officer or officers executing the same shall deem necessary
or desirable, and with such terms, conditions and provisions, including
modifications from the drafts presented to the Board of Directors, as the
officer or officers executing the same may approve, the execution of such
documents to evidence with approval conclusively; and further
RESOLVED, that any and all instruments executed and delivered on behalf of
the Company in connection with the foregoing resolutions by any person
purporting to be an officer of the Company shall be deemed to be the act of the
Company and shall be in all respects binding against the Company; and further
RESOLVED, that the officers of the Company be, and they hereby are,
authorized and empowered on behalf of and in the name of the Company to take or
cause to be taken in the name of the Company all such other and further action,
to make all payments and to execute, acknowledge and deliver any and all
certificates, opinions, documents and other instruments in such form and under
the corporate seal as required, as in the judgment of such officers may be
necessary, proper or convenient in order to carry out the foregoing resolutions,
to consummate the Loan described herein, and to comply with the terms and
provisions of all the documents described above; and further
RESOLVED, that all actions by any and all officers of the Company taken or
performed up to the date hereof and in respect to the preparation, execution and
delivering of the documents, certificates or other instruments required pursuant
to the provisions of the above-described documents, and the taking prior to the
date hereof of any and all actions otherwise required by the terms and
provisions of said documents or any other documents executed in connection
therewith be, and they are hereby, in all respects approved, ratified and
confirmed; and further
RESOLVED, that any one of the President, the Chairman of the Board of
Directors, Secretary or the Chief Executive Officer of the Company is hereby
authorized to make applications for and effect other loans from time to time on
behalf of the Company from the Lender and for such loans, to make, execute and
deliver promissory notes, drafts, bonds or other written obligations of the
Company in such form, date and maturity and at such rate of interest as such
officer or officers of the Company may determine and in the event the Company
adopts a corporate seal, to cause the same to be affixed to any such instruments
whenever necessary or required. It is further resolved that said officers are
hereby authorized in the name of the Company to renew or extend any loan or
loans from time to time and execute and deliver promissory notes, drafts, bonds
or other obligations or extensions to any notes theretofore given; and further
RESOLVED, that the authority hereinabove given to said officers to
negotiate loans in excess of the Loan specifically referenced herein shall
remain irrevocable insofar as the Lender is concerned until the Lender be
notified of the revocation of such authority and shall in writing acknowledge
receipt of such notification.
NOTICE OF INVALIDITY OF ORAL AGREEMENTS
TO: BORROWER AND ALL OTHER DEBTORS AND OBLIGORS WITH RESPECT TO THE LOAN WHICH
IS IDENTIFIED BELOW.
1. THIS WRITTEN LOAN AGREEMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.
THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
2. As used in this Notice:
"Borrower" means the borrower identified below.
"Debtor" and "Obligor" mean any entity who (i) is obligated or becomes
obligated to pay the Loan (for example, as maker, cosigner or guarantor) or (ii)
has pledged any property as security for the Loan.
"Lender" means the lender identified below.
"Loan" means the loans by Lender which are evidenced by the promissory
notes and note modification agreements of even date executed by Borrower,
payable to the order of Lender, as described in the Second Amendment to Amended
and Restated Letter Loan Agreement and Amended and Restated Security Agreement
and First Amendment to Revolving Note of even date herewith.
"Loan Agreement" means one or more promises, promissory notes, agreements,
undertakings, security agreements, deeds of trust or other documents, or
commitments, or any combination of those actions or documents, relating to the
Loan.
3. Each Borrower, Debtor, and Obligor who signs below acknowledges, represents,
and warrants to Lender that Lender has given and such party has received a copy
of this Notice on the date stated above, prior to the execution of any Loan
Agreement.
LENDER: BORROWER:
BANK ONE, TEXAS, ▇▇ ▇▇▇▇▇▇-▇▇▇▇▇▇, INC.
By:/s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇ By:/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
------------------ --------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇, Vice-President ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇,
Chairman of the Board of
Directors
Date: May 28, 1996 Date: May 28, 1996
