EXHIBIT 10.2
SECOND AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT
     THIS SECOND AMENDED AND RESTATED LOAN AND SECURITY AGREEMENT dated as of
December 11, 2006 (as further amended, modified or restated from time to time,
this “Agreement”), will serve to set forth the terms of the financing
transactions by and among ARDINGER FAMILY PARTNERSHIP, LTD., a Texas limited
partnership (“Lender”), VIEWCAST.COM, INC., f/k/a MULTIMEDIA ACCESS CORPORATION,
a Delaware corporation (“ViewCast”), OSPREY TECHNOLOGIES, INC., a Delaware
corporation (“Osprey”), and VIDEOWARE, INC., a Delaware corporation
(“VideoWare”) (ViewCast, Osprey, and VideoWare are jointly and severally
referred to as “Borrower”).
RECITALS
     WHEREAS, ViewCast and Lender have entered into that certain: (a) Amended
and Restated Loan and Security Agreement dated as of October 15, 2003 (as
further amended, modified or restated as of even date herewith, the “Original
Loan and Security Agreement”); and (b) that certain Amended and Restated Pledge
Agreement dated as of October 15, 2003 (as further amended, modified or restated
as of even date herewith, the “Original Pledge Agreement”);
     WHEREAS, ViewCast, Osprey and VideoWare and Lender desire to amend and
restate the indebtedness evidenced by that certain (a) Amended and Restated
Promissory Note, dated as of October 15, 2003, in the original principal amount
of $2,000,000.00 and (b) Promissory Note, dated as of October 15, 2003, in the
original principal amount of $6,909,582.25 (as either has been amended, modified
or restated to date, collectively, the “Original Promissory Notes”) with each of
the Original Promissory Notes executed by Borrower and payable to the order of
Lender and secured by the Original Loan and Security Agreement and the Original
Pledge Agreement (collectively with all other agreements, instruments and
documents evidencing, securing, governing, guaranteeing or pertaining thereto,
the “Original Loan Documents”);
     WHEREAS, Borrower owes Lender $10,509,582.25 (the “Principal Balance”)
under the Original Promissory Notes;
     WHEREAS, ViewCast and Lender are parties to that certain Exchange
Agreement, dated as of even date herewith (the “Exchange Agreement”) whereby
$8,000,000 of the Principal Balance will be exchanged for shares of ViewCast’s
Series E Convertible Redeemable Preferred Stock and $1,259,582.00 of the
Principal Balance will be exchanged for shares of ViewCast’s common stock;
     WHEREAS, as of the date hereof, immediately following the exchange under
the Exchange Agreement, Borrower owes Lender the remaining principal amount of
$1,250,000.25 (the “Outstanding Principal”) and owes Lender accrued and unpaid
interest of $3,891,360.53 (the “Accrued and Outstanding Interest”) (the
Outstanding Principal and the Accrued and Outstanding Interest are sometimes
collectively referred to as the “Existing Debt”);
     WHEREAS, ViewCast, Osprey and VideoWare desire to establish their borrowing
potential on a consolidated basis to the same extent possible if they were
merged into a single

 

--------------------------------------------------------------------------------

 

corporate entity and that this Agreement reflects an exchange of debt which
would not otherwise be available to ViewCast, Osprey and VideoWare if they were
not jointly and severally liable for payment of all of the Indebtedness (as
defined below); and
     WHEREAS, ViewCast, Osprey and VideoWare have determined that each will
benefit specifically and materially from the restructuring contemplated by this
Agreement;
     WHEREAS, ViewCast, Osprey and VideoWare have requested and bargained for
the structure and terms of and security for the transactions contemplated by
this Agreement; and
     WHEREAS, it is both a condition precedent to the obligations of Lender
hereunder and a desire of each entity constituting Borrower to execute and
deliver to Lender this Agreement;
     NOW THEREFORE, the parties hereto, intending to be legally bound, agree as
follows:
     1. Definitions. As used in this Agreement, the following terms shall have
the meanings indicated below:
     (a) “Accrued and Outstanding Interest” shall have the meaning set forth in
the Recitals.
     (b) “Affiliate” of any Person means any other Person that, directly or
indirectly, controls, is controlled by, or is under common control with, such
Person. For the purpose of this definition, “control” and the correlative
meanings of the terms “controlled by” and “under common control with” mean the
possession, directly or indirectly, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting shares, membership interests, or partnership interests or by
contract or otherwise.
     (c) “Applicable Bankruptcy Law” shall have the meaning set forth in Section
10(f).
     (d) “Applicable Federal Rate” shall mean the variable rate of interest per
annum which is equal to the Applicable Federal Rate as published by the U.S.
Department of the Treasury from time to time in accordance with Section 1274(d)
of the Internal Revenue Code of 1986.
     (e) “Claims” shall have the meaning set forth in Section 12.
     (f) “Business Day” shall mean shall mean any day other than a Saturday,
Sunday or any other day on which banks are authorized or required to be closed
in the State of Texas.
     (g) “Code” shall mean the Uniform Commercial Code as in effect in the State
of Texas on the date of this Agreement or as it may hereafter be amended from
time to time.
Second Amended and Restated
Loan and Security Agreement

Page 2

--------------------------------------------------------------------------------

 

     (h) “Collateral” shall mean:
          (i) All present and future accounts, chattel paper, documents,
instruments, deposit accounts, commercial tort claims, commodity accounts,
commodity contracts, instruments, investment property, letters of credit, letter
of credit rights, contract rights, money and general intangibles now or
hereafter owned, held, or acquired by Borrower.
          (ii) All present and hereafter acquired inventory and goods (including
without limitation, all raw materials, work in process and finished goods) held,
possessed, owned, held on consignment, or held for sale, lease, return or to be
furnished under contracts of services, in whole or in part, by Borrower wherever
located.
          (iii) All equipment and fixtures of whatsoever kind and character now
or hereafter possessed, held, acquired, leased or owned by Borrower, together
with all replacements, accessories, additions, substitutions and accessions to
all of the foregoing, and all records relating in any way to the foregoing.
          (iv) All Patents, Copyrights, Trademarks and Licenses now or hereafter
owned, held, or acquired by Borrower (including without limitation, those
Patents, Copyrights, Trademarks, and Licenses set forth on Exhibit A attached
hereto, if any).
The term “Collateral,” as used herein, shall also include all PRODUCTS and
PROCEEDS of all of the foregoing (including without limitation, insurance
payable by reason of loss or damage to the foregoing property) and any property,
securities, guaranties or monies of Borrower which may at any time come into the
possession of Lender. The term Collateral shall include all of Borrower’s
records relating in any way to the foregoing (including, without limitation, any
computer software, whether on tape, disk, card, strip, cartridge or any other
form). The designation of proceeds does not authorize Borrower to sell, transfer
or otherwise convey any of the foregoing property except finished goods intended
for sale or services provided in the ordinary course of Borrower’s business or
as otherwise provided herein.
     (i) “Consolidated Capital Expenditures” shall mean, for any period, all
capital expenditures of Borrower on a consolidated basis (i.e, capital
expenditures for ViewCast, Osprey and VideoWare) for such period, as determined
in accordance with generally accepted accounting principles.
     (j) “Consolidated EBITDA” shall mean, for any period, the sum of (i)
consolidated net income for Borrower (i.e, net income, without duplication, for
ViewCast, Osprey and VideoWare) for such period, plus (ii) an amount which, in
the determination of consolidated net income for such period, has been deducted
for (A) consolidated interest expense, (B) total federal, state, local and
foreign income, value added and similar taxes accrued during such period,
(C) losses (or minus gains) on the sale or disposition of assets outside the
ordinary course of business, and (D) depreciation, amortization expense and
other non-cash charges, all as determined in accordance with generally accepted
accounting principles.
Second Amended and Restated
Loan and Security Agreement

Page 3

--------------------------------------------------------------------------------

 

     (k) “Copyright” shall mean all right, title and interest in and to the
copyright applications and copyrights of Borrower and those copyrights which are
hereafter obtained or acquired by Borrower and all registrations, applications
and recordings thereof, including, without limitation, all reissues, divisions,
continuations, renewals, extensions and continuations-in-part thereof, and all
applications, registrations and recordings in the United States Copyright Office
or in any similar office or agency of the United States, or any State thereof,
all whether now owned or hereafter acquired by Borrower.
     (l) [intentionally omitted]
     (m) “Debt Payments” shall mean, as of any date of determination for
Borrower, the sum of all payments of principal and interest on indebtedness or
Redeemable Preferred Stock for the applicable period ending on the date of
determination (including the payments due on capital leases during the
applicable period ending on the date of determination) and excluding any
voluntary or required prepayments on the Note.
     (n) “Event of Default” shall have the meaning set forth in Section 10.
     (o) “Exchange Agreement” shall have the meaning set forth in the Recitals.
     (p) “Excess Cash Flow” shall mean, with respect to any six month period of
Borrower on a consolidated basis, an amount equal to (i) Consolidated EBITDA for
such period, minus (ii) Consolidated Capital Expenditures for such period, minus
(iii) Debt Payments made during such period, minus (iv) tax payments in respect
of federal, state, local and foreign income, franchise, property, sales, value
added and similar taxes made during such period, minus (v) any consolidated
negative working capital at the end of such period, minus (vi) a capital reserve
for scheduled payments due and budgeted operating and capital expenditures for
the subsequent fiscal year period in excess of any consolidated positive net
working capital at the end of such period, and plus (vii) distributions received
by Borrower from any other wholly owned subsidiaries.
     (q) “Existing Debt” shall have the meaning set forth in the Recitals.
     (r) “Indebtedness” shall mean (i) all indebtedness, obligations and
liabilities of Borrower to Lender of any kind or character, now existing or
hereafter arising, whether direct, indirect, related, unrelated, fixed,
contingent, liquidated, unliquidated, joint, several or joint and several, and
regardless of whether such indebtedness, obligations and liabilities may, prior
to their acquisition by Lender, be or have been payable to or in favor of a
third party and subsequently acquired by Lender (it being contemplated that
Lender may make such acquisitions from third parties), including without
limitation all indebtedness, obligations and liabilities of Borrower to Lender
now existing or hereafter arising under the Note, this Agreement, the other Loan
Documents or any draft, acceptance, guaranty, endorsement, letter of credit,
assignment, purchase, overdraft, discount, indemnity agreement or otherwise,
(ii) all accrued but unpaid interest on any of the indebtedness described in
Subsection (i) above, (iii) all obligations of Borrower to Lender under the Loan
Documents, (iv) all costs and expenses incurred by Lender in connection with the
collection and administration of all or any part of the indebtedness and
obligations described in (i), (ii) and (iii) above or the protection or
preservation of, or realization upon, the Collateral securing all or any part of
such indebtedness and
Second Amended and Restated
Loan and Security Agreement

Page 4

--------------------------------------------------------------------------------

 

obligations, including without limitation all reasonable attorneys’ fees, and
(v) all renewals, extensions, modifications and rearrangements of the
indebtedness and obligations described in Subsections (i), (ii), (iii) and (iv)
above.
     (s) “Indemnified Person” shall have the meaning set forth in Section 12.
     (t) “Licenses” shall mean the patent, trademark or copyright license
agreements of Borrower as any of the same may from time to time be amended or
supplemented and those licenses which are hereafter obtained or acquired by
Borrower.
     (u) “Loan” means all advances pursuant to the Loan Documents from time to
time .
     (v) “Loan Documents” shall mean this Agreement, the Note, the Pledge
Agreement, and the other agreements, instruments and documents evidencing,
securing, governing, guaranteeing or pertaining to the Loan.
     (w) “Maturity Date” shall mean the date that is the earliest of: (i)
December 31, 2009; (ii) the date of the sale of all or substantially all of the
assets or equity of Borrower; (iii) the date of any merger of Borrower with any
other entity in which the shareholders of Borrower prior to the merger do not
control the surviving entity following the merger; or (iv) the date of the
acceleration of the Indebtedness pursuant to the terms of this Agreement.
     (x) “Maximum Rate” means, at any particular time in question, the maximum
rate of interest that, under applicable law, may be charged on the Primary
Principal Amount or the Secondary Principal Amount, as applicable, at such time.
     (y) “Measuring Date” shall have the meaning set forth in Section 3(a).
     (z) “Note” shall have the meaning set forth in Section 4.
     (aa) “Obligation” shall mean all Indebtedness arising under this Agreement.
(bb) “Outstanding Principal” shall have the meaning set forth in the Recitals.
     (cc) “Patents” shall mean all right, title and interest in and to the
patent applications and patents of Borrower and those patents which are
hereafter obtained or acquired by Borrower and all registrations, applications
and recordings thereof, including, without limitation, all reissues, divisions,
continuations, renewals, extensions and continuations-in-part thereof, and all
applications, registrations and recordings in the United States Patent and
Trademark Office or in any similar office or agency of the United States, or any
State thereof, all whether now owned or hereafter acquired by Borrower.
     (dd) “Permitted Liens” shall have the meaning set forth in Section 7(c).
Second Amended and Restated
Loan and Security Agreement

Page 5

--------------------------------------------------------------------------------

 

     (ee) “Person” means an individual, sole proprietorship, joint venture,
association, trust, estate, business trust, corporation, non-profit corporation,
partnership, limited liability company, sovereign government or agency,
instrumentality, or political subdivision thereof, or any similar entity or
organization.
     (ff) “Pledge Agreement” shall mean that certain Amended and Restated Pledge
Agreement dated October 15, 2003 as amended, modified, or restated from time to
time between Borrower and Lender, including by the Confirmation of Amended and
Restated Pledge Agreement dated as of even date herewith, executed by ViewCast
and Lender.
     (gg) “Primary Contract Rate” shall mean the rate of interest per annum
which is equal to: (a) the Prime Rate; plus (b) one percent (1%); provided,
however, that the “Primary Contract Rate” shall not exceed nine and one-half
percent (9.50%) prior to December 31, 2007.
     (hh) “Prime Rate” shall mean the rate of interest per annum which is equal
to the variable rate of interest per annum equal to the prime rate as published
from time to time in the “Money Rates” table of The Wall Street Journal
(Southwest Edition). If the prime rate is no longer published in the “Money
Rates” table of The Wall Street Journal (Southwest Edition), then Lender will
choose a substitute index that is based upon comparable information.
     (ii) “Secondary Contract Rate” shall mean, at any time, the Applicable
Federal Rate at such time.
     (jj) “Trademarks” shall mean the registered trademarks and pending
applications therefor of Borrower and those trademarks which are hereafter
adopted or acquired by Borrower, and all right, title and interest therein and
thereto, and all registrations, applications, and recordings thereof, including,
without limitation, applications, registrations and recordings in the United
States Patent and Trademark Office or in any similar office or agency of the
United States, any State thereof, all whether now owned or hereafter acquired by
Borrower.
     (kk) “Unpaid Principal” shall mean an amount equal to the aggregate amount
of the Outstanding Principal and the Accrued and Outstanding Interest.
All words and phrases used herein shall have the meaning specified in the Code
except to the extent such meaning is inconsistent with this Agreement. Terms not
otherwise defined herein shall have the same meanings as in the Note.
     2. Restructuring of Existing Debt.
     (a) Modification of Existing Debt. In consideration for, among other
things, Lender’s consummation of the Exchange Agreement, Borrower agrees to
execute the Note, with the principal amount of the Note being the Unpaid
Principal and such amount representing the aggregate of the Outstanding
Principal (the “Primary Principal Amount”) and the Accrued and Outstanding
Interest (the “Secondary Principal Amount”). Borrower
Second Amended and Restated
Loan and Security Agreement

Page 6

--------------------------------------------------------------------------------

 

hereby acknowledges and agrees that no right of offset, defense, counterclaim,
claim, causes of action or objection in favor of Borrower against Lender exists
arising out of or with respect to any of the Existing Debt, the Outstanding
Principal, the Accrued and Outstanding Interest, the Original Loan Documents,
the Original Promissory Notes, or with respect to any other documents or
instruments now or heretofore evidencing, securing or in any way relating to any
of the foregoing, and Borrower does hereby expressly waive, release and
relinquish any and all such defenses, setoffs, claims, counterclaims and causes
of action, if any, against Lender relating to the Existing Debt, or the Original
Loan Documents. Borrower acknowledges and agrees that Lender is not required or
obligated to make any further advances to Borrower under the Original Loan
Documents, the Note, this Agreement, or any other Loan Document.
     (b) No Revolving Facility. Borrower may not reborrow any sums paid or
prepaid under the Note, the Loan, or this Agreement.
     (c) Joint and Several Obligation. Each obligation hereunder of Borrower is
a joint and several obligation of each entity constituting Borrower.
     3. Payment of Obligation.
     (a) Mandatory Prepayment from Excess Cash Flow. On a date within sixty (60)
days after each December 31 (each December 31 is a “Measuring Date”), beginning
within sixty (60) days after December 31, 2006, Borrower shall prepay the unpaid
balance of the Primary Principal Amount in an amount equal to fifty percent
(50%) of the Excess Cash Flow earned during the twelve (12) month period ending
on the immediately preceding Measuring Date.
     (b) Mandatory Prepayment from Certain Asset Sales. Within three
(3) Business Days of Borrower’s receipt of the net proceeds of any asset sale
not in the ordinary course of business of at least $500,000, Borrower shall
prepay the unpaid balance of the Primary Principal Amount in an amount equal to
seventy-five percent (75%) of such net cash proceeds.
     (c) Payment of Interest on Primary Principal Amount. (i) Interest on the
unpaid Primary Principal Amount shall be calculated at a fluctuating rate per
annum which shall be equal to the lesser of: (x) the Maximum Rate; and (y) the
Primary Contract Rate, each change in the rate to be charged on the Primary
Principal Amount to become effective without notice to Borrower on the effective
date of each such change in the Maximum Rate or the Prime Rate, as the case may
be; provided, however, that if at any time the Primary Contract Rate shall
exceed the Maximum Rate, thereby causing the interest on the Primary Principal
Amount to be limited to the Maximum Rate, then any subsequent reduction in the
Prime Rate shall not reduce the rate of interest on the Primary Principal Amount
below the Maximum Rate until the total amount of interest accrued on the Primary
Principal Amount equals the amount of interest which would have accrued on the
Primary Principal Amount if the Primary Contract Rate had at all times been in
effect. (ii) Interest on the unpaid Primary Principal Amount shall accrue daily
and be paid monthly in arrears, on the last Business Day of each month.
Second Amended and Restated
Loan and Security Agreement

Page 7

--------------------------------------------------------------------------------

 

     (d) Payment of Interest on Secondary Principal Amount. Interest on the
unpaid Secondary Principal Amount shall be calculated at a fluctuating rate per
annum which shall be equal to the lesser of: (x) the Maximum Rate; and (y) the
Secondary Contract Rate, each change in the rate to be charged on the Secondary
Principal Amount to become effective without notice to Borrower on the effective
date of each such change in the Maximum Rate or the Applicable Federal Rate, as
the case may be; provided, however, that if at any time the Secondary Contract
Rate shall exceed the Maximum Rate, thereby causing the interest on the
Secondary Principal Amount to be limited to the Maximum Rate, then any
subsequent reduction in the Applicable Federal Rate shall not reduce the rate of
interest on the Secondary Principal Amount below the Maximum Rate until the
total amount of interest accrued on the Secondary Principal Amount equals the
amount of interest which would have accrued on the Secondary Principal Amount if
the Secondary Contract Rate had at all times been in effect. (ii) Interest on
the unpaid Secondary Principal Amount shall be paid in full on the Maturity
Date.
     (e) Payment of Outstanding Obligation. On the Maturity Date, Borrower shall
repay the outstanding Unpaid Principal and all accrued and unpaid interest
thereon.
     4. Promissory Note. The Unpaid Principal shall be evidenced by a promissory
note (such promissory note to be in the form of Exhibit B attached hereto,
together with any amendments, modifications, replacements, substitutions,
restatements, renewals, extensions and increases thereof, the “Note”) duly
executed by Borrower and payable to the order of Lender. Interest on the Note
shall accrue at the rate set forth herein. The principal of and interest on the
Note shall be due and payable in accordance with the terms and conditions set
forth in the Note and this Agreement. The Note shall be given in amendment,
restatement and extension, but not extinguishment, of all amounts left owing and
unpaid (following the exchange of $9,259,582 pursuant to the Exchange Agreement)
under the Original Promissory Notes.
     5. Confirmation of Liens and Grant of Liens on Collateral. As collateral
and security for the Indebtedness, (a) Borrower hereby ratifies and confirms
each and all of the liens previously granted to Lender and (b) each Borrower
hereby grants to Lender, its successors and assigns, a first priority lien and
security interest in and to all of the Collateral.
     5. Representations and Warranties. Borrower hereby represents and warrants
to Lender as follows:
     (a) Existence. Borrower is (i) duly organized, validly existing and in good
standing under the laws of the State of Delaware, and (ii) duly qualified and
licensed in all other states and jurisdictions where it is doing business,
except where the failure to be so qualified or licensed would not (A) have a
material adverse effect on Borrower, or (B) affect the enforceability of the
lien granted Lender on the Collateral. Borrower has all requisite power and
authority to execute and deliver the Loan Documents.
     (b) Binding Obligations. The execution, delivery, and performance of the
Loan Documents by Borrower have been duly authorized by all necessary action by
Borrower, and constitute legal, valid and binding obligations of Borrower,
enforceable in accordance with their respective terms, except as limited by
bankruptcy, insolvency or
Second Amended and Restated
Loan and Security Agreement

Page 8

--------------------------------------------------------------------------------

 

similar laws of general application relating to the enforcement of creditors’
rights and except to the extent specific remedies may generally be limited by
equitable principles.
     (c) No Consent. The execution, delivery and performance of the Loan
Documents, and the consummation of the transactions contemplated thereby, do not
(i) conflict with, result in a violation of, or constitute a default under
(1) any provision of its organizational documents or other instrument binding
upon Borrower, (2) any law, governmental regulation, court decree or order
applicable to Borrower, or (3) any agreement, judgment, license, order or permit
applicable to or binding upon Borrower, (ii) require the consent, approval or
authorization of any third party, or (iii) result in or require the creation of
any lien, charge or encumbrance upon any assets or properties of Borrower or of
any person except as may be expressly contemplated in the Loan Documents.
     (d) Financial Condition. Each financial statement of Borrower supplied to
the Lender truly discloses and fairly presents Borrower’s financial condition as
of the date of each such statement. There has been no material adverse change in
such financial condition or results of operations of Borrower subsequent to the
date of the most recent financial statement supplied to the Lender.
     (e) Litigation. There are no actions, suits or proceedings, pending or, to
the knowledge of Borrower, threatened against or affecting Borrower, or the
assets or properties of Borrower, before any court or governmental department,
commission or board, which, if determined adversely, would have a material
adverse effect on the assets, liabilities, financial condition, properties,
business or results of operations of Borrower.
     (f) Taxes; Governmental Charges. Borrower has filed all federal, state and
local tax reports and returns required by any law or regulation to be filed by
it and has either duly paid all taxes, duties and charges indicated due on the
basis of such returns and reports, or made adequate provision for the payment
thereof, and the assessment of any material amount of additional taxes in excess
of those paid and reported is not reasonably expected.
     (g) Ownership and Liens. Borrower has good and marketable title to the
Collateral free and clear of all liens, security interests, encumbrances or
adverse claims, (other than the Permitted Liens). To Borrower’s knowledge, no
dispute, right of setoff, counterclaim or defense exists with respect to all or
any part of the Collateral. Borrower has not executed any other security
agreement currently affecting the Collateral and no effective financing
statement or other instrument similar in effect covering all or any part of the
Collateral is on file in any recording office.
     (h) Security Interest. Borrower has, and will have at all times, full
right, power and authority to grant a security interest in the Collateral to
Lender in the manner provided herein, free and clear of any lien, security
interest or other charge or encumbrance other than the Permitted Liens. This
Agreement creates a legal, valid and binding security interest in favor of
Lender in the Collateral securing the Indebtedness. Possession by Lender of
certain types of Collateral from time to time or the filing of the financing
statements delivered prior hereto or concurrently herewith by Borrower to
Second Amended and Restated
Loan and Security Agreement

Page 9

--------------------------------------------------------------------------------

 

Lender will perfect and establish the first priority of Lender’s security
interest hereunder in the Collateral.
     (i) Location. Borrower’s chief executive office and the office where the
records concerning the Collateral are kept is at its address set forth on the
signature page hereof. All Collateral shall be kept at such address and at such
other locations as may be identified to Lender in writing in advance from
time-to-time in accordance with this Agreement.
     (j) Operation of Business. To the best of it’s knowledge, Borrower
possesses all licenses, permits, franchises, patents, copyrights, trademarks,
and trade names, or rights thereto, to conduct business as now conducted and as
presently proposed to be conducted, and Borrower is not in violation of any
valid rights or others with respect to any of the foregoing.
     6. Affirmative Covenants. Until all Indebtedness of Borrower under the Loan
Documents is fully paid and satisfied, and Lender has no further commitment to
lend hereunder, Borrower agrees and covenants that it will, unless Lender shall
otherwise consent in writing:
     (a) Accounts and Records. Maintain its books and records in accordance with
generally accepted accounting principles.
     (b) Right of Inspection. Permit Lender to visit its properties and
installations and to examine, audit and make and take away copies or
reproductions of Borrower’s books and records, at all reasonable times and upon
prior written notice.
     (c) Right to Additional Information. Furnish Lender with such information
and statements, lists of assets and liabilities, tax returns, and other reports
with respect to Borrower’s financial condition and business operations as Lender
may reasonably request from time to time.
     (d) Compliance with Laws. Conduct its business in an orderly and efficient
manner consistent with good business practices, and perform and comply with all
applicable statutes, rules, regulations or ordinances imposed by any
governmental unit upon Borrower, its businesses, operations and properties
(including without limitation, all applicable environmental statutes, rules,
regulations and ordinances), where the failure to perform or comply could have a
material adverse effect on the assets, liabilities, financial condition,
properties, business or results of operations of Borrower. ViewCast will timely
make all filings required by, and otherwise comply with all applicable
obligations of, the federal securities laws of the United States.
     (e) Taxes. Pay and discharge when due all of its indebtedness and
obligations, including without limitation, all assessments, taxes, governmental
charges, levies and liens, of every kind and nature, imposed upon Borrower or
its properties, income, or profits, prior to the date on which penalties would
attach, and all lawful claims that, if unpaid, might become a lien or charge
upon any of Borrower’s properties, income, or profits; provided, however,
Borrower will not be required to pay and discharge any such assessment, tax,
charge, levy, lien or claim so long as (i) the legality of the same shall be
Second Amended and Restated
Loan and Security Agreement

Page 10

--------------------------------------------------------------------------------

 

contested in good faith by appropriate judicial, administrative or other legal
proceedings, and (ii) Borrower shall have established on its books adequate
reserves with respect to such contested assessment, tax, charge, levy, lien or
claim in accordance with generally accepted accounting principles, consistently
applied.
     (f) Insurance. Maintain insurance, including but not limited to, fire
insurance, comprehensive property damage, public liability, worker’s
compensation, business interruption and other insurance deemed reasonably
necessary. Borrower will, at its own expense, maintain insurance with respect to
all Collateral in such amounts, against such risks, in such form and with such
insurers, as shall be satisfactory to Lender from time to time. Each policy of
insurance maintained by Borrower shall (i) name Borrower and Lender as insured
parties thereunder (without any representation or warranty by or obligation upon
Lender) as their interests may appear, (ii) contain the agreement by the insurer
that any loss thereunder shall be payable to Lender notwithstanding any action,
inaction or breach of representation or warranty by Borrower, (iii) provide that
there shall be no recourse against Lender for payment of premiums or other
amounts with respect thereto, and (iv) provide that at least thirty (30) days
prior written notice of cancellation or of lapse shall be given to Lender by the
insurer. Borrower will deliver to Lender original or duplicate policies of such
insurance and, as often as Lender may reasonably request, a report of a
reputable insurance broker with respect to such insurance. Borrower will also,
at the request of Lender, duly execute and deliver instruments of assignment of
such insurance policies and cause the respective insurers to acknowledge notice
of such assignment. All insurance payments in respect of loss of or damage to
any Collateral shall be paid to Lender and applied by Lender in accordance with
the Loan Documents.
     (g) Notice of Indebtedness. Promptly inform Lender of the creation,
incurrence or assumption by Borrower of any actual or contingent liabilities not
permitted under this Agreement.
     (h) Notice of Litigation. Promptly after the commencement thereof, notify
Lender of all actions, suits and proceedings before any court or any
governmental department, commission or board in which Borrower is a plaintiff or
defendant or any of the properties or assets of Borrower are the subject of such
actions, suits or proceedings.
     (i) Notice of Material Adverse Change. Promptly inform Lender of (i) any
and all material adverse changes in Borrower’s financial condition, and (ii) all
claims made against Borrower that could materially affect the financial
condition of Borrower.
     (j) Ownership and Liens. Borrower will maintain good and marketable title
to all Collateral free and clear of all liens, security interests, encumbrances
or adverse claims, except for the security interest created by this Agreement or
Permitted Liens. Borrower will cause any financing statement or other security
instrument with respect to the Collateral to be terminated, except for Permitted
Liens. Borrower will defend at its expense Lender’s right, title and security
interest in and to the Collateral against the claims of any third party.
Second Amended and Restated
Loan and Security Agreement

Page 11

--------------------------------------------------------------------------------

 

     (k) Further Assurances. Borrower will from time to time at its expense
promptly execute and deliver all further instruments and documents and take all
further action necessary or appropriate or that Lender may reasonably request in
order (i) to perfect and protect the security interest created or purported to
be created hereby and the priority of such security interest, (ii) to enable
Lender to exercise and enforce its rights and remedies hereunder in respect of
the Collateral, and (iii) to otherwise effect the purposes of this Agreement,
including without limitation: (1) executing and filing such financing or
continuation statements, or amendments thereto; and (2) furnishing to Lender
from time to time statements and schedules further identifying and describing
the Collateral and such other reports in connection with the Collateral, all in
reasonable detail satisfactory to Lender.
     (l) Accounts and General Intangibles. Borrower will, except as otherwise
provided herein, collect, at Borrower’s own expense, all amounts due or to
become due under each of the accounts and general intangibles. In connection
with such collections, Borrower may and, at Lender’s direction, will take such
action not otherwise forbidden herein as Borrower or Lender may deem reasonably
necessary or advisable to enforce collection or performance of each of the
accounts and general intangibles. Borrower will also duly perform and cause to
be performed all of its material obligations with respect to the goods or
services, the sale or lease or rendition of which gave rise or will give rise to
each account and all of its obligations to be performed under or with respect to
the general intangibles. Borrower also covenants and agrees to take any action
and/or execute any documents that Lender may request in order to comply with the
Federal Assignment of Claims Act, as amended.
     (m) Chattel Paper, Documents and Instruments. Borrower will take such
action as may be requested by Lender in order to cause any chattel paper,
documents or instruments to be valid and enforceable and will cause all chattel
paper to have only one original counterpart. Upon request by Lender, Borrower
will deliver to Lender all originals of chattel paper, documents or instruments
and will mark all chattel paper with a legend indicating that such chattel paper
is subject to the security interest granted hereunder.
     (n) Maintenance of Existence. Preserve and maintain its corporate existence
and good standing in the jurisdiction of its organization, and qualify and
remain qualified as a foreign entity in each jurisdiction in which such
qualification is required.
     (o) Maintenance of Properties. Maintain, keep, and preserve all of its
properties (tangible and intangible) necessary or useful in the conduct of its
business.
     (p) Conduct of Business. Continue to engage in an efficient and economical
manner in a business of the same general type as now conducted by it on the date
of this Agreement within Borrower’s powers under organizational documents.
     7. Negative Covenants. Until all Indebtedness of Borrower under the Loan
Documents is fully paid and satisfied, and the Lender has no further commitment
to lend hereunder, Borrower will not, without the prior written consent of
Lender:
Second Amended and Restated
Loan and Security Agreement

Page 12

--------------------------------------------------------------------------------

 

     (a) Nature of Business. Make any material change in the nature of its
business as carried on as of the date hereof.
     (b) Liquidations, Mergers, Consolidations. Liquidate, merge or consolidate
with or into any other entity.
     (c) Liens. Create or incur any lien or encumbrance on any of its assets,
other than (i) liens and security interests securing indebtedness owing to
Lender, (ii) liens existing on the date hereof and, to the extend previously
required, previously approved in writing by Lender, (iii) purchase money
security interests incurred in connection with Borrower’s acquisition of goods;
(iv) liens for taxes, assessments, customs, duties or similar charges either
(A) not yet due, or (B) being contested in good faith by appropriate proceedings
and for which Borrower has established adequate reserves, (v) liens imposed by
mandatory provisions of law such as for materialmen’s, mechanic’s,
warehousemen’s and other like liens arising in the ordinary course of Borrower’s
or any Affiliate’s respective business, (vi) pledges or deposits in connection
with leases, real estate bids or contracts (other than contracts involving the
borrowing of money), (vii) encumbrances consisting of zoning restrictions,
easements, or other restrictions on the use of real property, provided that such
encumbrances do not impair the use of such property for the uses intended, and
none of which is violated by existing or proposed structures or land use, and
(viii) liens approved in writing by Lender (collectively, the “Permitted
Liens”).
     (d) Indebtedness. Create, incur or assume any indebtedness for borrowed
money or issue or assume any other note, debenture, bond or other evidences of
indebtedness, or guarantee any such indebtedness or such evidences of
indebtedness of others, other than (i) borrowings from Lender, (ii) borrowings
for a permitted purpose not to exceed $250,000.00 per year, (iii) trade payables
in the ordinary course of business, (iv) indebtedness between or among Borrower
and one or more wholly-owned subsidiaries of Borrower so long as evidenced by a
note and the note is pledged to Lender; (v) indebtedness secured by Permitted
Liens; or (vi) as previously consented to in writing by Lender.
     (e) Loan. Make loans to, or guarantee any obligation of, any other Person,
without written permission from the Lender; provided that such limitation shall
not apply in respect of any loan by and between Borrower and any wholly-owned
subsidiary of Borrower, or to any guaranty by Borrower of the indebtedness of
any wholly-owned subsidiary of Borrower, or vice versa.
     (f) Transactions with Affiliates. Enter into any transaction, including,
without limitation, the purchase, sale or exchange of property or the rendering
of any service, with any Affiliate of Borrower, except in the ordinary course of
and pursuant to the reasonable requirements of Borrower’s business and upon fair
and reasonable terms no less favorable to Borrower than would be obtained in a
comparable arm’s-length transaction with a Person not an Affiliate of Borrower.
     (g) Dividends. Declare or pay any dividends on any equity interest of
Borrower, make any other distributions with respect to any payment on account of
the
Second Amended and Restated
Loan and Security Agreement

Page 13

--------------------------------------------------------------------------------

 

purchase, redemption, or other acquisition or retirement of any equity interest
of Borrower, or make any other distribution, sale, transfer or lease of any of
Borrower’s assets other than in the ordinary course of business, unless any such
amounts are directly utilized for the payment of (i) principal or interest on
indebtedness and obligations owing from time to time by Borrower to Lender, or
(ii) taxes owing by a shareholder of Borrower to the extent that such taxes are
incurred as a result of the business operations of Borrower.
     (h) Transfer or Encumbrance. Borrower will not (i) sell, assign (by
operation of law or otherwise), transfer, exchange, lease or otherwise dispose
of any of the Collateral, (ii) grant a lien or security interest in or execute,
file or record any financing statement or other security instrument with respect
to the Collateral other than the Permitted Liens, or (iii) deliver actual or
constructive possession of any of the Collateral to any party other than Lender,
except for (1) transfers previously disclosed to Lender, (2) sales of inventory
in the ordinary course of business, and (3) the sale or other disposal of any
item of equipment which is worn out or obsolete and which has been replaced by
an item of equal suitability and value, owned by Borrower and made subject to
the security interest under this Agreement, but which is otherwise free and
clear of any lien, security interest, encumbrance or adverse claim other than
Permitted Liens; provided, however, the exceptions permitted in clauses
(1) through (3) above shall automatically terminate upon the occurrence of an
Event of Default.
     (i) Impairment of Security Interest. Take any action that would in any
manner impair the value or enforceability of Lender’s security interest in any
Collateral.
     (j) Compromise of Collateral. Adjust, settle, compromise, amend or modify
any Collateral, except an adjustment, settlement, compromise, amendment or
modification in good faith and in the ordinary course of business; provided,
however, this exception shall automatically terminate upon the occurrence of an
Event of Default. Borrower shall provide to Lender such information concerning
(i) any adjustment, settlement, compromise, amendment or modification of any
Collateral, and (ii) any claim asserted by any account debtor for credit,
allowance, adjustment, dispute, setoff or counterclaim, as Lender may reasonably
request from time to time.
     (k) Financing Statement Filings. Cause or permit any change in the location
of (i) any Collateral, (ii) any records concerning any Collateral,
(iii) Borrower’s chief executive office, or (iv) the state of Borrower’s
organization to a jurisdiction other than as represented herein unless Borrower
shall have notified Lender in writing of such change at least sixty (60) days
prior to the effective date of such change, and shall have first taken all
action required by Lender for the purpose of further perfecting or protecting
the security interest in favor of Lender in the Collateral.
     (l) Capital Expenditures. Make capital expenditures in any fiscal year in
excess of $100,000.00 in the aggregate.
     (m) Leases. Create, incur, assume, or suffer to exist, any obligation as
lessee for the rental or hire of any real or personal property, except leases
(i) totaling in the aggregate an amount equal to or less than $500,000.00 in any
fiscal year of Borrower and
Second Amended and Restated
Loan and Security Agreement

Page 14

--------------------------------------------------------------------------------

 

(ii) for a maximum lease period thirty-six (36) months or less without written
permission from Lender, except for real property leases which may have a maximum
lease period of sixty (60) months.
     (n) Investments. Purchase any stock or debt obligations for cash (except
obligations of the U.S. government).
     (o) Changes in Management or Ownership. Make any changes in management that
might materially change the character or operating philosophy of Borrower.
     8. Reporting Requirements. Until the Indebtedness of Borrower under this
Agreement and the other Loan Documents is fully paid and satisfied, and the
Lender has no further commitment to lend hereunder, Borrower will, unless Lender
shall otherwise consent in writing, furnish to Lender:
     (a) Interim Financial Statements. As soon as available, and in any event
within forty-five (45) days after the end of each calendar quarter, financial
statements of Borrower as of the end of such calendar quarter all in form and
substance and in reasonable detail satisfactory to Lender and duly certified
(subject to year-end review adjustments) by an appropriate person (i) as being
true and correct in all material aspects to the best of his or her knowledge
(subject to year end adjustments), and (ii) as having been prepared in
accordance with generally accepted accounting principles, consistently applied.
     (b) Annual Financial Statements and Tax Returns. As soon as available and
in any event within (i) one hundred-twenty (120) days after the end of each
fiscal year of Borrower, a balance sheet, cash flow and income statement of
Borrower as of the end of such fiscal year, in each case compiled by independent
public accountants of recognized standing acceptable to Lender, and (ii) within
thirty (30) days of filing, annual income tax returns for Borrower.
     (c) Notice of Litigation. Promptly after the commencement thereof, notice
of all actions, suits, and proceedings before any court or governmental
department, commission, board, bureau, agency, or instrumentality, domestic or
foreign, affecting Borrower which, if determined adversely to Borrower could
have a material adverse effect on the financial condition, properties, or
operations of Borrower.
     (d) Notice of Default and Events of Default. As soon as possible and in any
event within thirty (30) days after the concurrence of each default or event of
default, a written notice setting forth the details of such default or event of
default and the action which is proposed to be taken by Borrower with respect
thereto.
     (e) General Information. Such other information respecting the condition or
operations, financial or otherwise, of Borrower or any subsidiary as the Lenders
may from time to time reasonably request, including copies of all filings with
the Securities and Exchange Commission.
Second Amended and Restated
Loan and Security Agreement

Page 15

--------------------------------------------------------------------------------

 

     9. Rights of Lender. Lender shall have the rights contained in this Section
at all times that this Agreement is effective.
     (a) Additional Financing Statements Filings. Borrower hereby authorizes
Lender to file, without the signature of Borrower, one or more financing or
continuation statements, and amendments thereto, relating to the Collateral.
Borrower hereby irrevocably authorizes Lender at any time and from time to time
to file in any Uniform Commercial Code jurisdiction any initial financing
statements and amendments thereto that (i) indicate the Collateral (A) as all
assets of Borrower or words of similar effect, regardless of whether any
particular asset comprised in the Collateral falls within the scope of Article
or Chapter 9 of the Code, or (B) as being of an equal or lesser scope or with
greater detail, and (ii) contain any other information required by Chapter 9 of
the Code for the sufficiency or filing office acceptance of any financing
statement or amendment.
     (b) Power of Attorney. Borrower hereby irrevocably appoints Lender as
Borrower’s attorney-in-fact, such power of attorney being coupled with an
interest, with full authority in the place and stead of Borrower and in the name
of Borrower or otherwise, from time to time in Lender’s reasonable discretion,
to take any action and to execute any instrument which Lender may deem necessary
or appropriate to accomplish the purposes of this Agreement, including without
limitation: (i) to obtain and adjust insurance required by Lender hereunder;
(ii) to demand, collect, sue for, recover, compound, receive and give
acquittance and receipts for moneys due and to become due under or in respect of
the Collateral; (iii) to receive, endorse and collect any drafts or other
instruments, documents and chattel paper in connection with clause (i) or
(ii) above; and (iv) to file any claims or take any action or institute any
proceedings which Lender may deem necessary or appropriate for the collection
and/or preservation of the Collateral or otherwise to enforce the rights of
Lender with respect to the Collateral.
     (c) Performance by Lender. If Borrower fails to perform any agreement or
obligation provided herein, Lender may itself perform, or cause performance of,
such agreement or obligation, and the expenses of Lender incurred in connection
therewith shall be a part of the Indebtedness, secured by the Collateral and
payable by Borrower on demand.
     (d) Borrower’s Receipt of Proceeds. All amounts and proceeds (including
instruments and writings) received by Borrower in respect of such accounts or
general intangibles shall be received in trust for the benefit of Lender
hereunder and, upon request of Lender, shall be segregated from other property
of Borrower and shall be forthwith delivered to Lender in the same form as so
received (with any necessary endorsement) and applied to the Indebtedness in
accordance with the Loan Documents.
     (e) Notification of Account Debtors. Lender may at its reasonable
discretion from time to time notify any or all obligors under any accounts or
general intangibles (i) of Lender’s security interest in such accounts or
general intangibles and direct such obligors to make payment of all amounts due
or to become due to Borrower thereunder directly to Lender, and (ii) to verify
the accounts or general intangibles with such obligors. Lender shall have the
right, at the expense of Borrower, to enforce
Second Amended and Restated
Loan and Security Agreement

Page 16

--------------------------------------------------------------------------------

 

collection of any such accounts or general intangibles and to adjust, settle or
compromise the amount or payment thereof, in the same manner and to the same
extent as Borrower.
     10. Events of Default. Each of the following shall constitute an “Event of
Default” under this Agreement:
     (a) The failure, refusal or neglect of Borrower to pay when due any part of
the principal of, or interest on, the Note, or any other Indebtedness owing to
Lender by Borrower from time to time and such failure, refusal or neglect shall
continue unremedied for a period of five (5) Business Days after written notice
from Lender to Borrower.
     (b) The failure of Borrower to timely and properly observe, keep or perform
any covenant, agreement, warranty or condition required herein or in any of the
other Loan Documents which is not cured within ten (10) Business Days following
written notice from Lender to Borrower.
     (c) The occurrence of an event of default under any of the other Loan
Documents or under any other agreement now existing or hereafter arising between
Lender and Borrower which is not cured within ten (10) Business Days following
written notice from Lender to Borrower.
     (d) Any representation contained herein or in any of the other Loan
Documents made by Borrower is false or misleading in any material respect.
     (e) The occurrence of any event which permits the acceleration of the
maturity of any indebtedness owing by Borrower or any of its subsidiaries to any
third party under any agreement or understanding.
     (f) If Borrower: (i) becomes insolvent, or makes a transfer in fraud of
creditors, or makes an assignment for the benefit of creditors, or admits in
writing its inability to pay its debts as they become due; (ii) generally is not
paying its debts as such debts become due; (iii) has a receiver, trustee or
custodian appointed for, or take possession of, all or substantially all of its
assets, either in a proceeding brought by it or in a proceeding brought against
it and such appointment is not discharged or such possession is not terminated
within sixty (60) days after the effective date thereof or it consents to or
acquiesces in such appointment or possession; (iv) files a petition for relief
under the United States Bankruptcy Code or any other present or future federal
or state insolvency, Bankruptcy or similar laws (all of the foregoing
hereinafter collectively called “Applicable Bankruptcy Law”) or an involuntary
petition for relief is filed against it under any Applicable Bankruptcy Law and
such involuntary petition is not dismissed within sixty (60) days after the
filing thereof, or an order for relief naming it is entered under any Applicable
Bankruptcy Law, or any composition, rearrangement, extension, reorganization or
other relief of Borrowers now or hereafter existing is requested or consented to
by it; (v) fails to have discharged within a period of thirty (30) days any
attachment, sequestration or similar writ levied upon any property of it; or
(vi) fails to pay within thirty (30) days any final money judgment against it.
Second Amended and Restated
Loan and Security Agreement

Page 17

--------------------------------------------------------------------------------

 

     (g) Except as otherwise provided in this Agreement, the liquidation,
dissolution, merger or consolidation of any Borrower.
     (h) The entry of any judgment against Borrower or the issuance or entry of
any attachments or other liens against any of the property of Borrower for an
amount in excess of $10,000.00 (individually or in the aggregate) if
undischarged, unbonded or undismissed on the date on which such judgment could
be executed upon.
     (i) The Collateral or any portion thereof is taken on execution or other
process of law in any action against Borrower.
     (j) The holder of any lien or security interest on any of the assets of
Borrower, including without limitation, the Collateral (without hereby implying
the consent of Lender to the existence or creation of any such lien or security
interest on the Collateral), declares a default thereunder or institutes
foreclosure or other proceedings for the enforcement of its remedies thereunder.
     (k) This Agreement shall at any time after its execution and delivery and
for any reason cease (i) to create a valid and perfected first priority security
interest in and to the property purported to be subject to this Agreement; or
(ii) to be in full force and effect or shall be declared null and void, or the
validity of enforceability hereof shall be contested by Borrower, or Borrower
shall deny it has any further liability or obligation under this Agreement or
the other Loan Documents.
Nothing contained in this Agreement shall be construed to limit the events of
default enumerated in any of the other Loan Documents and all such events of
default shall be cumulative.
     11. Remedies and Related Rights. If an Event of Default shall have
occurred, and without limiting any other rights and remedies provided herein,
under any of the Loan Documents or otherwise available to Lender, Lender may
exercise one or more of the rights and remedies provided in this Section.
     (a) Remedies. Upon the occurrence of any one or more of the foregoing
Events of Default, (i) the entire unpaid balance of principal of the Note,
together with all accrued but unpaid interest thereon, and all other
indebtedness owing to Lender by Borrower at such time shall, at the option of
Lender, become immediately due and payable without further notice, demand,
presentation, notice of dishonor, notice of intent to accelerate, notice of
acceleration, protest or notice of protest of any kind, all of which are
expressly waived by Borrower, and (ii) Lender may, at its option, cease further
advances under the Note and this Agreement; provided, however, concurrently and
automatically with the occurrence of an Event of Default under Section 13(f):
(i) further advances under the Note and this Agreement, and (ii) the Note and
all other Indebtedness owing to Lender by Borrower at such time shall, without
any action by Lender, become due and payable, without further notice, demand,
presentation, notice of dishonor, notice of acceleration, notice of intent to
accelerate, protest or notice of protest of any kind, all of which are expressly
waived by Borrower. All rights and remedies of Lender set forth in this
Agreement and in any of the other Loan Documents may also be exercised by
Lender, at its option to be exercised in its sole discretion, upon the
occurrence of an Event of Default,
Second Amended and Restated
Loan and Security Agreement

Page 18

--------------------------------------------------------------------------------

 

and not in substitution or diminution of any rights now or hereafter held by
Lender under the terms of any other agreement.
     (b) Other Remedies. Lender may from time to time at its discretion, without
limitation and without notice except as expressly provided in any of the Loan
Documents:
          (i) exercise in respect of the Collateral all the rights and remedies
of a Lender under the Code (whether or not the Code applies to the affected
Collateral);
          (ii) require Borrower to, and Borrower hereby agrees that it will at
its expense and upon request of Lender, assemble the Collateral as directed by
Lender and make it available to Lender at a place to be designated by Lender
which is reasonably convenient to both parties;
          (iii) reduce its claim to judgment or foreclose or otherwise enforce,
in whole or in part, the security interest granted hereunder by any available
judicial procedure;
          (iv) sell or otherwise dispose of, at its office, on the premises of
Borrower or elsewhere, the Collateral, as a unit or in parcels, by public or
private proceedings, and by way of one or more contracts (it being agreed that
the sale or other disposition of any part of the Collateral shall not exhaust
Lender’s power of sale, but sales or other dispositions may be made from time to
time until all of the Collateral has been sold or disposed of or until the
Indebtedness has been paid and performed in full), and at any such sale or other
disposition it shall not be necessary to exhibit any of the Collateral;
          (v) buy the Collateral, or any portion thereof, at any public sale;
          (vi) buy the Collateral, or any portion thereof, at any private sale
if the Collateral is of a type customarily sold in a recognized market or is of
a type which is the subject of widely distributed standard price quotations;
          (vii) apply for the appointment of a receiver for the Collateral, and
Borrower hereby consents to any such appointment; and
          (viii) at its option, retain the Collateral in satisfaction of the
Indebtedness whenever the circumstances are such that Lender is entitled to do
so under the Code or otherwise.
Borrower agrees that in the event Borrower is entitled to receive any notice
under the Uniform Commercial Code, as it exists in the state governing any such
notice, of the sale or other disposition of any Collateral, reasonable notice
shall be deemed given when such notice is deposited in a depository receptacle
under the care and custody of the United States Postal Service, postage prepaid,
at Borrower’s address set forth on the signature page hereof, five (5) days
prior to the date of any public sale, or after which a private sale, of any of
such Collateral is to be held. Lender shall not be obligated to make any sale of
Collateral regardless of notice of sale having been given. Lender may adjourn
any
Second Amended and Restated
Loan and Security Agreement

Page 19

--------------------------------------------------------------------------------

 

public or private sale from time to time by announcement at the time and place
fixed therefor, and such sale may, without further notice, be made at the time
and place to which it was so adjourned.
     (c) Application of Proceeds. If any Event of Default shall have occurred,
Lender may at its discretion apply or use any cash held by Lender as Collateral,
and any cash proceeds received by Lender in respect of any sale or other
disposition of, collection from, or other realization upon, all or any part of
the Collateral as follows in such order and manner as Lender may elect:
          (i) to the repayment or reimbursement of the reasonable costs and
expenses (including, without limitation, reasonable attorneys’ fees and
expenses) incurred by Lender in connection with (1) the administration of the
Loan Documents, (2) the custody, preservation, use or operation of, or the sale
of, collection from, or other realization upon, the Collateral, and (3) the
exercise or enforcement of any of the rights and remedies of Lender hereunder;
          (ii) to the payment or other satisfaction of any liens and other
encumbrances upon the Collateral;
          (iii) to the satisfaction of the Indebtedness;
          (iv) by holding such cash and proceeds as Collateral;
          (v) to the payment of any other amounts required by applicable law
(including without limitation, Section 9.504(a)(3) of the Code or any other
applicable statutory provision); and
          (vi) by delivery to Borrower or any other party lawfully entitled to
receive such cash or proceeds whether by direction of a court of competent
jurisdiction or otherwise.
     (d) Deficiency. In the event that the proceeds of any sale of, collection
from, or other realization upon, all or any part of the Collateral by Lender are
insufficient to pay all amounts to which Lender is legally entitled, Borrower
and any party who guaranteed or is otherwise obligated to pay all or any portion
of the Indebtedness shall be liable for the deficiency, together with interest
thereon as provided in the Loan Documents.
     (e) Non-Judicial Remedies. In granting to Lender the power to enforce its
rights hereunder without prior judicial process or judicial hearing, Borrower
expressly waives, renounces and knowingly relinquishes any legal right which
might otherwise require Lender to enforce its rights by judicial process.
Borrower recognizes and concedes that non-judicial remedies are consistent with
the usage of trade, are responsive to commercial necessity and are the result of
a bargain at arm’s length. Nothing herein is intended to prevent Lender or
Borrower from resorting to judicial process at either party’s option.
Second Amended and Restated
Loan and Security Agreement

Page 20

--------------------------------------------------------------------------------

 

     (f) Other Recourse. Borrower waives any right to require Lender to proceed
against any third party, exhaust any Collateral or other security for the
Indebtedness, or to have any third party joined with Borrower in any suit
arising out of the Indebtedness or any of the Loan Documents, or pursue any
other remedy available to Lender. Borrower further waives any and all notice of
acceptance of this Agreement and of the creation, modification, rearrangement,
renewal or extension of the Indebtedness. Borrower further waives any defense
arising by reason of any disability or other defense of any third party or by
reason of the cessation from any cause whatsoever of the liability of any third
party. Until all of the Indebtedness shall have been paid in full, Borrower
shall have no right of subrogation and Borrower waives the right to enforce any
remedy which Lender has or may hereafter have against any third party, and
waives any benefit of and any right to participate in any other security
whatsoever now or hereafter held by Lender. Borrower authorizes Lender, and
without notice or demand and without any reservation of rights against Borrower
and without affecting Borrower’s liability hereunder or on the Indebtedness to
(i) take or hold any other property of any type from any third party as security
for the Indebtedness, and exchange, enforce, waive and release any or all of
such other property, (ii) apply such other property and direct the order or
manner of sale thereof as Lender may in its discretion determine, (iii) renew,
extend, accelerate, modify, compromise, settle or release any of the
Indebtedness or other security for the Indebtedness, (iv) waive, enforce or
modify any of the provisions of any of the Loan Documents executed by any third
party, and (v) release or substitute any third party.
     12. Indemnity. Borrower hereby indemnifies and agrees to hold harmless and
defend Lender, and its officers, directors, employees, agents and
representatives (each an “Indemnified Person”) from and against any and all
liabilities, obligations, claims, losses, damages, penalties, actions,
judgments, suits, costs, expenses or disbursements of any kind or nature
(collectively, the “Claims”) which may be imposed on, incurred by, or asserted
against, any Indemnified Person arising in connection with the Loan Documents,
the Indebtedness or the Collateral (including without limitation, the
enforcement of the Loan Documents and the defense of any Indemnified Person’s
actions and/or inactions in connection with the Loan Documents). WITHOUT
LIMITATION, THE FOREGOING INDEMNITIES SHALL APPLY TO EACH INDEMNIFIED PERSON
WITH RESPECT TO ANY CLAIMS WHICH IN WHOLE OR IN PART ARE CAUSED BY OR ARISE OUT
OF THE NEGLIGENCE OF SUCH INDEMNIFIED PERSON AND/OR ANY OTHER INDEMNIFIED
PERSON, except to the limited extent the Claims against an Indemnified Person
are proximately caused by such Indemnified Person’s gross negligence or willful
misconduct. If Borrower or any third party ever alleges such gross negligence or
willful misconduct by any Indemnified Person, the indemnification provided for
in this Section shall nonetheless be paid upon demand, subject to later
adjustment or reimbursement, until such time as a court of competent
jurisdiction enters a final judgment as to the extent and effect of the alleged
gross negligence or willful misconduct. The indemnification provided for in this
Section shall survive the termination of this Agreement and shall extend and
continue to benefit each individual or entity who is or has at any time been an
Indemnified Person hereunder.
     13. Waiver and Agreement. Neither the failure nor any delay on the part of
Lender to exercise any right, power or privilege herein or under any of the
other Loan Documents shall operate as a waiver thereof, nor shall any single or
partial exercise of such right, power or
Second Amended and Restated
Loan and Security Agreement

Page 21

--------------------------------------------------------------------------------

 

privilege preclude any other or further exercise thereof or the exercise of any
other right, power or privilege. No waiver of any provision in this Agreement or
in any of the other Loan Documents and no departure by Borrower therefrom shall
be effective unless the same shall be in writing and signed by Lender, and then
shall be effective only in the specific instance and for the purpose for which
given and to the extent specified in such writing. No modification or amendment
to this Agreement or to any of the other Loan Documents shall be valid or
effective unless the same is signed by the party against whom it is sought to be
enforced.
     14. Benefits. This Agreement shall be binding upon and inure to the benefit
of Lender and Borrower, and their respective successors and assigns, provided,
however, that Borrower may not, without the prior written consent of Lender,
assign any rights, powers, duties or obligations under this Agreement or any of
the other Loan Documents.
     15. Notices. All notices, requests, demands or other communications
required or permitted to be given pursuant to this Agreement shall be in writing
and given by (a) personal delivery, (b) expedited delivery service with proof of
delivery, or (c) United States mail, postage prepaid, registered or certified
mail, return receipt requested, sent to the intended addressee at the address
set forth on the signature page hereof and shall be deemed to have been received
either, in the case of personal delivery, as of the time of personal delivery,
in the case of expedited delivery service, as of the time of the expedited
delivery and in the manner provided herein, or in the case of mail, upon the
third day after deposit in a depository receptacle under the care and custody of
the United States Postal Service. Either party shall have the right to change
its address for notice hereunder to any other location within the continental
United States by notice to the other party of such new address at least thirty
(30) days prior to the effective date of such new address.
     16. Construction. This Agreement and the other Loan Documents have been
executed and delivered in the State of Texas, shall be governed by and construed
in accordance with the laws of the State of Texas, and shall be performable by
the parties hereto in the county in Texas where the Lender’s address set forth
on the signature page hereof is located.
     17. Invalid Provisions. If any provision of this Agreement or any of the
other Loan Documents are held to be illegal, invalid or unenforceable under
present or future laws, such provision shall be fully severable and the
remaining provisions of this Agreement or any of the other Loan Documents shall
remain in full force and effect and shall not be affected by the illegal,
invalid or unenforceable provision or by its severance.
     18. Expenses. Borrower shall pay all costs and expenses (including, without
limitation, reasonable attorneys’ fees) in connection with (a) the drafting and
execution of the Loan Documents and the transactions contemplated therein
(b) any action required in the course of administration of the indebtedness and
obligations evidenced by the Loan Documents, and (c) any action in the
enforcement of Lender’s rights upon the occurrence of an Event of Default.
     19. Participation of the Loan. Borrower agrees that Lender may, at its
option, sell interests in the Loan and its rights under this Agreement to a
financial institution or institutions and, in connection with each such sale,
Lender may disclose any financial and other information available to Lender
concerning Borrower to each perspective purchaser subject to obtaining a
Second Amended and Restated
Loan and Security Agreement

Page 22

--------------------------------------------------------------------------------

 

confidentiality agreement with each prospective purchaser prior to disclosing
Borrower’s confidential information.
     20. Conflicts. In the event any term or provision hereof is inconsistent
with or conflicts with any provision of the other Loan Documents, the terms and
provisions contained in this Agreement shall be controlling.
     21. Counterparts. This Agreement may be separately executed in any number
of counterparts, each of which shall be an original, but all of which, taken
together, shall be deemed to constitute one and the same instrument.
     22. Amendment and Consolidation. This Agreement is an amendment and
restatement of the Original Loan and Security Agreement.
     23. Interpretation. Whenever the context requires in this Agreement, the
gender of all words used in Agreement include the masculine, feminine, and
neuter and the singular form of nouns, pronouns, and verbs shall include the
plural and vice versa. Use of “herein,” “hereof,” “hereby,” “hereunder,” or
similar terms in this Agreement refer to this Agreement as a whole and not to
any particular provision or part hereof. Unless otherwise specified, all
references to a Section refer to sections of this Agreement. The terms
“include,” “includes,” and “including” mean “include without limitation,”
“includes without limitation,” and “including without limitation” and the term
“or” has the inclusive meaning represented by the phrase “and/or.”
     24. Time of the Essence. Time is of the essence with respect to all
obligations of Borrower to give notice and otherwise take action hereunder.
NOTICE OF FINAL AGREEMENT
     THIS AGREEMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT
BETWEEN THE PARTIES, AND THE SAME MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS BETWEEN THE PARTIES. THERE ARE NO
UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
REMAINDER OF PAGE LEFT INTENTIONALLY BLANK;
SIGNATURE PAGES FOLLOW
Second Amended and Restated
Loan and Security Agreement

Page 23

--------------------------------------------------------------------------------

 

AGREED and accepted as of the date first written above.

              LENDER:       ADDRESS:
 
            ARDINGER FAMILY PARTNERSHIP, LTD.       1990 Lakepointe Drive,
 
          Lewisville, TX 75057
 
           
By:
  /s/ H.T. Ardinger, Jr.        
 
           
Name:
  H.T. Ardinger, Jr.        
Title:
  General Partner        
 
            BORROWER:       ADDRESS:
 
            VIEWCAST.COM, INC.        
 
           
By:
  /s/ Laurie L. Latham       3701 W. Plano Parkway
 
           
Name:
  Laurie L. Latham       Suite 300
Title:
  Chief Financial Officer       Plano, TX 75075
 
            OSPREY TECHNOLOGIES, INC.        
 
           
By:
  /s/ Laurie L. Latham       3701 W. Plano Parkway
 
           
Name:
  Laurie L. Latham       Suite 300
Title:
  Chief Financial Officer       Plano, TX 75075
 
            VIDEOWARE, INC.        
 
           
By:
  /s/ Laurie L. Latham       3701 W. Plano Parkway
 
           
Name:
  Laurie L. Latham       Suite 300
Title:
  Chief Financial Officer       Plano, TX 75075

Signature Page
to Second Amended and Restated Loan and Security Agreement

 

--------------------------------------------------------------------------------

 

EXHIBIT A
TRADEMARKS, PATENTS, COPYRIGHTS AND LICENSES
Trademarks:
EZStream®
Niagara®
(NIAGARA LOGO) [d42110d4211001.gif]
Niagara SCX®
Osprey®
SchedulStream®
SimulStream®
ViewCast®
Viewpoint VBX®
WorkFone®
Your Video On The Web®
EaseStream™
Increase your Revenue Stream with ViewCast™
Personal Viewpoint™
Viewpoint Pro™
Patents:
Application Number: 11/220,025
Title: Streaming Media Encoder With Confidence Monitor
Application Number: 11/220,181
Title: Streaming Media Encoder With Front Panel Control Interface
Application Number: 11/399,081
Title: Quick-Change Acesssory Mount for a Portable Meadi Encoder
Application Number: 11/399,093
Title: Portable Media Encoder With Remote Session Management Interface
Application Number: 11/398,841
Title: Media Encoder with Remote Setup Management Interface
Application Number: 11/391,014
Title: Portable Media Encoder
Application Number: 11/353,750
Title: Audio Encoding and Transmission Method
Copyrights and Licenses - Software is copyrighted as internally developed.