Exhibit 10.29


 


EXECUTION COPY


 


LOAN AGREEMENT


 


by and between


 


PROFICIO BANK,


 


as Lender,


 


and


 


CONSONUS ACQUISITION CORP.,


 


as Borrower


 


 






 


Dated May 21, 2008


 






 

















 


TABLE OF CONTENTS


 


 


	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  SECTION 1 DEFINITIONS

  	
   

  	
  1

  
	
  1.1

  	
   

  	
  Definitions

  	
   

  	
  1

  
	
  1.2

  	
   

  	
  Accounting
  Terms and Calculations

  	
   

  	
  10

  
	
  1.3

  	
   

  	
  Computation
  of Time Periods

  	
   

  	
  11

  
	
  1.4

  	
   

  	
  Other
  Definitional Terms

  	
   

  	
  11

  
	
   

  	
   

  	
   

  
	
  SECTION 2 TERM LOAN

  	
   

  	
  11

  
	
  2.1

  	
   

  	
  Term
  Loan

  	
   

  	
  11

  
	
  2.2

  	
   

  	
  Non-Revolving
  Loan

  	
   

  	
  11

  
	
  2.3

  	
   

  	
  The
  Note

  	
   

  	
  11

  
	
  2.4

  	
   

  	
  Interest;
  Applicable LIBOR Rate

  	
   

  	
  11

  
	
  2.5

  	
   

  	
  Maturity
  Date

  	
   

  	
  11

  
	
  2.6

  	
   

  	
  Prepayment;
  Application of Payments

  	
   

  	
  11

  
	
  2.7

  	
   

  	
  Fees

  	
   

  	
  12

  
	
  2.8

  	
   

  	
  Cross
  Default

  	
   

  	
  12

  
	
   

  	
   

  	
   

  
	
  SECTION 3 GENERAL LOAN PROVISIONS

  	
   

  	
  12

  
	
  3.1

  	
   

  	
  Time
  and Place of Payments; Monthly Payments

  	
   

  	
  12

  
	
  3.2

  	
   

  	
  Costs
  and Expenses

  	
   

  	
  13

  
	
  3.3

  	
   

  	
  Lender’s
  Right to Cure Defaults

  	
   

  	
  13

  
	
  3.4

  	
   

  	
  Effect
  of Loan Documents

  	
   

  	
  13

  
	
  3.5

  	
   

  	
  Lender
  Call Option upon Refinancing or Modification of Senior Indebtedness

  	
   

  	
  13

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  SECTION 4 CONDITIONS PRECEDENT TO CLOSING

  	
   

  	
  14

  
	
  4.1

  	
   

  	
  Representations
  and Warranties Accurate

  	
   

  	
  14

  
	
  4.2

  	
   

  	
  Loan
  Documentation

  	
   

  	
  14

  
	
  4.3

  	
   

  	
  Closing
  of the Loan

  	
   

  	
  14

  
	
  4.4

  	
   

  	
  Payment
  of Costs, Expenses and Fees

  	
   

  	
  15

  
	
  4.5

  	
   

  	
  Review
  Items

  	
   

  	
  15

  
	
  4.6

  	
   

  	
  Corporate
  Documents

  	
   

  	
  15

  
	
  4.7

  	
   

  	
  Taxes

  	
   

  	
  15

  
	
  4.8

  	
   

  	
  Insurance

  	
   

  	
  15

  
	
  4.9

  	
   

  	
  Capital
  Structure

  	
   

  	
  15

  
	
  4.10

  	
   

  	
  10
  Indebtedness; Liens; UCC Filings

  	
   

  	
  16

  
	
  4.11 

  	
   

  	
  Consent
  and Estoppel Certificates

  	
   

  	
  16

  
	
  4.12 

  	
   

  	
  Other
  Actions

  	
   

  	
  16

  
	
   

  	
   

  	
   

  
	
  SECTION 5 REPRESENTATIONS AND WARRANTIES

  	
   

  	
  16

  
	
  5.1

  	
   

  	
  Organization
  of Borrower; Authority to Enter into Agreement

  	
   

  	
  16

  
	
  5.2

  	
   

  	
  Financial
  Statements

  	
   

  	
  17

  
	
  5.3

  	
   

  	
  Litigation

  	
   

  	
  17

  
	
  5.4

  	
   

  	
  Subsidiaries

  	
   

  	
  17

  



 


i

















 


	
  5.5

  	
   

  	
  Use
  of Proceeds

  	
   

  	
  17

  
	
  5.6

  	
   

  	
  Solvency

  	
   

  	
  17

  
	
  5.7

  	
   

  	
  No
  Violation of Other Agreements; No Default

  	
   

  	
  18

  
	
  5.8

  	
   

  	
  Government
  Consents

  	
   

  	
  18

  
	
  5.9

  	
   

  	
  Accuracy
  of Information

  	
   

  	
  18

  
	
  5.10

  	
   

  	
  Good
  Faith; Bankruptcy

  	
   

  	
  18

  
	
  5.11

  	
   

  	
  Taxes

  	
   

  	
  19

  
	
  5.12

  	
   

  	
  Trademarks;
  Patents

  	
   

  	
  19

  
	
  5.13

  	
   

  	
  Collateral

  	
   

  	
  19

  
	
  5.14

  	
   

  	
  Approvals
  and Permits; Compliance With Laws

  	
   

  	
  19

  
	
  5.15

  	
   

  	
  Indebtedness

  	
   

  	
  19

  
	
  5.16

  	
   

  	
  Environmental
  Matters

  	
   

  	
  19

  
	
  5.17

  	
   

  	
  ERISA
  Matters

  	
   

  	
  20

  
	
  5.18

  	
   

  	
  Regulatory
  Matters

  	
   

  	
  20

  
	
  5.19

  	
   

  	
  Labor
  Relations

  	
   

  	
  20

  
	
  5.20

  	
   

  	
  Brokers’ Fees; Transaction Fees

  	
   

  	
  20

  
	
  5.21

  	
   

  	
  Anti-Terrorism
  Laws

  	
   

  	
  20

  
	
  5.22

  	
   

  	
  Material
  Adverse Effect

  	
   

  	
  21

  
	
  5.23

  	
   

  	
  Fixtures

  	
   

  	
  21

  
	
  5.24

  	
   

  	
  Payoff
  of Adjustment Note

  	
   

  	
  21

  
	
  5.25

  	
   

  	
  Survival
  of Representations

  	
   

  	
  21

  
	
  5.26

  	
   

  	
  Representations
  and Warranties Continuing

  	
   

  	
  22

  
	
   

  	
   

  	
   

  
	
  SECTION
  6 AFFIRMATIVE COVENANTS

  	
   

  	
  22

  
	
  6.1

  	
   

  	
  Books
  and Records; Periodic Audits

  	
   

  	
  22

  
	
  6.2

  	
   

  	
  Collateral
  Inspections

  	
   

  	
  22

  
	
  6.3

  	
   

  	
  Existence

  	
   

  	
  22

  
	
  6.4

  	
   

  	
  Maintain
  Business

  	
   

  	
  22

  
	
  6.5

  	
   

  	
  Conduct
  of Business

  	
   

  	
  22

  
	
  6.6

  	
   

  	
  Headquarters

  	
   

  	
  23

  
	
  6.7

  	
   

  	
  Payment
  of Taxes and Claims

  	
   

  	
  23

  
	
  6.8

  	
   

  	
  Insurance

  	
   

  	
  23

  
	
  6.9

  	
   

  	
  Complying
  with the Loan Documents and Other Documents

  	
   

  	
  24

  
	
  6.10

  	
   

  	
  Compliance

  	
   

  	
  24

  
	
  6.11

  	
   

  	
  Payment
  of Claims

  	
   

  	
  24

  
	
  6.12

  	
   

  	
  Intellectual
  Property

  	
   

  	
  24

  
	
  6.13

  	
   

  	
  Further
  Assurances

  	
   

  	
  24

  
	
  6.14

  	
   

  	
  Notices
  of Certain Events

  	
   

  	
  25

  
	
  6.15

  	
   

  	
  Certificates;
  Other Information

  	
   

  	
  26

  
	
  6.16

  	
   

  	
  Notice
  of Restructuring or Modification of Senior Indebtedness

  	
   

  	
  26

  
	
  6.17

  	
   

  	
  Payoff
  of Obligations upon Change of Control

  	
   

  	
  26

  
	
   

  	
   

  	
   

  
	
  SECTION
  7 NEGATIVE COVENANTS

  	
   

  	
  26

  
	
  7.1

  	
   

  	
  Investments

  	
   

  	
  26

  
	
  7.2

  	
   

  	
  Merger

  	
   

  	
  27

  
	
  7.3

  	
   

  	
  Sales
  and other Fundamental Changes

  	
   

  	
  27

  
	
  7.4

  	
   

  	
  Inconsistent
  Agreements

  	
   

  	
  28

  



 


ii

















 


	
  7.5

  	
   

  	
  Guarantees

  	
   

  	
  28

  
	
  7.6

  	
   

  	
  Negative Pledges

  	
   

  	
  28

  
	
  7.7

  	
   

  	
  Liens

  	
   

  	
  28

  
	
  7.8

  	
   

  	
  Restrictions on Other
  Indebtedness

  	
   

  	
  28

  
	
  7.9

  	
   

  	
  Limitations on
  Distributions; Management Fee; Restricted Payments

  	
   

  	
  29

  
	
  7.10

  	
   

  	
  Loan
  Proceeds

  	
   

  	
  29

  
	
  7.11

  	
   

  	
  Equipment

  	
   

  	
  29

  
	
  7.12

  	
   

  	
  Affiliate
  Transactions

  	
   

  	
  29

  
	
  7.13

  	
   

  	
  Senior
  Notes

  	
   

  	
  30

  
	
  7.14

  	
   

  	
  No
  Assignment

  	
   

  	
  30

  
	
  7.15

  	
   

  	
  Senior
  Debt Cap

  	
   

  	
  30

  
	
  7.16

  	
   

  	
  No
  Additional Subordinated
  Debt

  	
   

  	
  30

  
	
   

  	
   

  	
   

  
	
  SECTION 8
  FINANCIAL COVENANTS

  	
   

  	
  30

  
	
  8.1

  	
   

  	
  Special Definitions

  	
   

  	
  30

  
	
  8.2

  	
   

  	
  Borrower’s Financial
  Covenants

  	
   

  	
  30

  
	
  8.3

  	
   

  	
  Financial Statements and
  Other Reports

  	
   

  	
  31

  
	
   

  	
   

  	
   

  
	
  SECTION 9
  EVENTS OF DEFAULT; ACCELERATION; REMEDIES

  	
   

  	
  32

  
	
  9.1

  	
   

  	
  Non-Payment

  	
   

  	
  32

  
	
  9.2

  	
   

  	
  Cross-Default

  	
   

  	
  32

  
	
  9.3

  	
   

  	
  Financial Condition

  	
   

  	
  32

  
	
  9.4

  	
   

  	
  Involuntary Bankruptcy

  	
   

  	
  32

  
	
  9.5

  	
   

  	
  Breach of Warranty

  	
   

  	
  33

  
	
  9.6

  	
   

  	
  Financial Reporting

  	
   

  	
  33

  
	
  9.7

  	
   

  	
  Covenants

  	
   

  	
  33

  
	
  9.8

  	
   

  	
  Subordination of Note and
  Obligations

  	
   

  	
  33

  
	
  9.9

  	
   

  	
  Default under Amended and
  Restated Credit Agreement

  	
   

  	
  33

  
	
  9.10

  	
   

  	
  Material Adverse Effect

  	
   

  	
  33

  
	
  9.11

  	
   

  	
  Security Interests

  	
   

  	
  33

  
	
  9.12

  	
   

  	
  Change of Control

  	
   

  	
  33

  
	
  9.13

  	
   

  	
  Judgments

  	
   

  	
  33

  
	
  9.14

  	
   

  	
  Seizure, etc.

  	
   

  	
  34

  
	
  9.15

  	
   

  	
  Event of Loss

  	
   

  	
  34

  
	
  9.16

  	
   

  	
  Acceleration; Remedies

  	
   

  	
  34

  
	
   

  	
   

  	
   

  
	
  SECTION
  10 OTHER TERMS AND CONDITIONS

  	
   

  	
  35

  
	
  10.1

  	
   

  	
  Legal
  Representation

  	
   

  	
  35

  
	
  10.2

  	
   

  	
  Governing
  Law; Submission to Jurisdiction

  	
   

  	
  35

  
	
  10.3

  	
   

  	
  Lender’s Rights Optional; Marshaling;
  Payments; Set Aside

  	
   

  	
  35

  
	
  10.4

  	
   

  	
  Modification,
  Waiver, Consent and Failure to Exercise

  	
   

  	
  35

  
	
  10.5

  	
   

  	
  Indemnification

  	
   

  	
  36

  
	
  10.6

  	
   

  	
  Notices

  	
   

  	
  36

  
	
  10.7

  	
   

  	
  Non-Business
  Day; Computation of Time

  	
   

  	
  37

  
	
  10.8

  	
   

  	
  Time
  of Essence

  	
   

  	
  37

  
	
  10.9

  	
   

  	
  Recitals,
  Exhibits and Schedules

  	
   

  	
  38

  
	
  10.10

  	
   

  	
  Severability; Titles

  	
   

  	
  38

  



 


iii

















 


	
  10.11

  	
   

  	
  Counterparts

  	
   

  	
  38

  
	
  10.12

  	
   

  	
  Entire
  Agreement

  	
   

  	
  38

  
	
  10.13

  	
   

  	
  Binding
  Effect; Participation

  	
   

  	
  38

  
	
  10.14

  	
   

  	
  Information

  	
   

  	
  38

  
	
  10.15

  	
   

  	
  Waiver
  of Jury Trial

  	
   

  	
  39

  
	
  10.16

  	
   

  	
  ARBITRATION
  DISCLOSURES

  	
   

  	
  39

  
	
  10.17

  	
   

  	
  Construction

  	
   

  	
  41

  
	
  10.18

  	
   

  	
  Post-Closing
  Deliveries

  	
   

  	
  41

  



 


 


EXHIBITS:


 


	
  Exhibit “A”

  	
  –

  	
  Form of
  Compliance Certificate

  
	
  Exhibit 
  “B”

  	
  –

  	
  Form of
  Note

  



 


SCHEDULES:


 


	
  Schedule 1.1

  	
  –

  	
  Permitted Liens

  
	
  Schedule 5.4

  	
  –

  	
  Subsidiaries

  
	
  Schedule 5.23

  	
  –

  	
  Fixtures

  
	
  Schedule 7.1

  	
  –

  	
  Permitted Investments

  
	
  Schedule 7.8

  	
  –

  	
  Indebtedness

  



 


iv














 


LOAN AGREEMENT


 


THIS
LOAN AGREEMENT (this “Agreement”) is entered into
effective as of May 21, 2008, by and between Proficio Bank, a Utah
corporation (“Lender”),  and Consonus Acquisition Corp., a Delaware corporation
(“Borrower”).
Lender and Borrower are sometimes referred to herein collectively as the “parties”
and individually as a “party”.


 


RECITALS


 


A.                                   WHEREAS, Consonus, Inc. and Borrower
entered into an Asset Purchase Agreement dated as of May 31, 2005 with
respect to the Asset Purchase Transaction, and in connection therewith,
Borrower also entered into a Credit Agreement dated as of May 31, 2005
with U.S. Bank, pursuant to which, among other things, U.S. Bank, as senior
lender, extended to Borrower a term loan and a revolving line of credit (the “Original
Credit Agreement”);


 


B.                                     WHEREAS, the Original Credit Agreement was
amended and restated as provided by the Amended and Restated Credit Agreement;


 


C.                                     WHEREAS, in connection with the Asset
Purchase Transaction, Consonus, Inc., as a subordinated lender, loaned
Borrower Three Million Five Hundred Fifty Thousand Dollars and No/100
($3,550,000.00) pursuant to a Secured Promissory Note dated May 31, 2005
and due on or about May 31, 2008, of which Two Million Eight Hundred
Thousand Dollars and No/100 ($2,800,000.00) plus accrued interest thereon
remains outstanding (the “Consonus Seller Note”);  and


 


D.                                    WHEREAS, Borrower has requested that Lender
make a term loan to and for the benefit of Borrower in the Loan Amount in order
for Borrower to repay the Consonus Seller Notes, and Lender is willing to do so
on the terms and conditions set forth in this Agreement.


 


NOW, THEREFORE, in consideration of the covenants and conditions,
representations and warranties, and agreements contained herein, and other good
and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged by all parties hereto, Borrower and Lender agree as follows:


 


SECTION 1 


DEFINITIONS


 


1.1                                 Definitions. The following capitalized terms, when used in this Agreement, shall
have the meanings set forth below (such meanings to be applicable, except to
the extent otherwise indicated in a definition of a particular term, both to
the singular and the plural of the terms defined): “Accommodation Obligations”
shall mean any Indebtedness or other contractual obligation or liability,
contingent or otherwise, of another Person in respect of which Borrower is
liable, including, without limitation, any such Indebtedness, obligation or
liability directly or indirectly guaranteed, endorsed (otherwise than for
collection or deposit in the ordinary course of business), co-made or
discounted or sold with recourse by Borrower, or in respect of which Borrower
is otherwise directly or indirectly liable (including any partnership in which
Borrower has a general partnership interest), contractual obligations
(contingent or


 


1

















 


otherwise)
arising through any agreement to purchase, repurchase or otherwise acquire such
Indebtedness, obligation or liability or any security therefor, or to provide
funds for the payment or discharge thereof (whether in the form of loans,
advances, stock purchases, capital contributions or otherwise), or to maintain
solvency, assets, level of income, or other financial condition, or to make
payment other than for value received. “Account Debtor”
shall mean any Person that is obligated on or under an Account.


 


“Accounts” shall mean all present and future “accounts”
(as that term is defined in the UCC) of Borrower.


 


“Adjustment Note” shall have the meaning set forth in Section 5.24.


 


“Administrator” shall have the meaning set forth in Section 10.16.


 


“Affiliate” shall mean, with respect to any Person, any
other Person directly or indirectly controlling, controlled by, or under common
control with, that Person. For purposes of this definition, “control”
(including, with correlative meanings, the terms “controlling,” “controlled by”
and “under common control with”), as applied to any Person, means the
possession, directly or indirectly, of the power to vote fifty percent (50%) or
more of the Equity Interests having voting power for the election of directors
of such Person or otherwise to direct or cause the direction of the management
and policies of that Person, whether through the ownership of voting Equity
Interests or by contract or otherwise.


 


“Agreement” shall mean this Loan Agreement, as the same
may be modified, amended, extended, supplemented or restated.


 


“Amended and Restated Credit Agreement” shall mean that certain Amended and Restated
Credit Agreement dated as of November 19, 2007, entered into by and
between U.S. Bank, as lender, and Borrower, as borrower, as the same has been
further amended by that certain First Amendment to Amended and Restated Credit
Agreement dated as of January 23, 2008 by and between U.S. Bank and
Borrower.


 


“Anti-Terrorism Laws” shall have the meaning set forth in Section 5.21(a).


 


“Applicable LIBOR Rate” shall mean the rate of interest, rounded
upward to the nearest whole one-thousandth of one percent, equal to the sum of (a) the
LIBOR Rate plus (b) the LIBOR Spread.


 


“arbitration clause” shall have the meaning set forth in Section 10.16.


 


“Asset Purchase Transaction” shall mean the asset purchase transaction
consummated pursuant to this certain Asset Purchase Agreement dated May 31,
2005 entered into by and between Consonus, Inc., as seller, and Borrower,
as buyer.


 


“Authorized Officer” shall mean the following officers with
respect to Borrower: Daniel Milburn, Robert Muir and Nana Baffour. The term “Authorized
Officer” shall further include any other officer(s) of Borrower as
certified by Borrower to Lender for purpose of making certifications or reports
required by this Agreement.


 


2

















 


“Business Day” shall mean every day except a Saturday,
Sunday, national holiday, or a day on which Lender is obligated or permitted to
be closed.


 


“Call Option” shall have the meaning set forth in Section 3.5.


 


“Capital Lease
Obligations”
means the principal amount of all monetary obligations under that portion of
any leasing or similar arrangement that, in accordance with GAAP, is or should
be classified as a capital lease.


 


“Change of
Control”
means any event or series of events that causes Knox Lawrence International or
its Affiliates to own, directly or indirectly, less than fifty-one percent
(51%) of the Equity Interests in Borrower (other than in connection with an IPO
whereby more than fifty-one percent
(51%) of the Equity Interests in Borrower are sold to and owned directly or
indirectly by the public.


 


“Closing” shall mean the Business Day selected by
Borrower and Lender for the closing of the Loan. Lender shall have no
obligation to close under this Agreement until and unless all conditions
precedent to such closing have been satisfied.


 


“Closing Date” shall mean the day on which the Closing
takes place.


 


“Code”  shall mean the Internal Revenue Code of 1986, as amended.


 


“Collateral” shall mean any and all property owned by any
Loan Party and encumbered by this Agreement, the Security Agreement or any of
the other Loan Documents in connection with the Loan, whether owned by each
Loan Party on the Closing Date or subsequent hereto.


 


“Compliance
Certificate”
shall mean a certificate demonstrating Borrower’s compliance with the Financial
Covenants set forth in this Agreement, in the form attached as Exhibit “A”.


 


“Consonus, Inc.” means Consonus, Inc., a Utah
corporation now known as “Salt Lake Data Center Company”.


 


“Consonus
Seller Note”
shall have the meaning set forth in the above Recitals.


 


“Cumulative
Quarterly Net Income” shall mean the total net income of Borrower for the Loan Quarter in
question determined in accordance with GAAP.


 


“Default” shall mean an event or circumstances that,
with notice or lapse of time or both, would constitute an Event of Default.


 


“Dispute” shall have the meaning set forth in Section 10.16. 


 


“EBITDA” shall have the meaning set forth in Section 8.1(a).


 


3

















 


“Environmental
Laws”
shall mean all federal, state, district, local and foreign laws, rules,
regulations, ordinances, and consent decrees relating to health, safety,
hazardous substances, pollution and environmental matters, as now or at anytime
hereafter in effect, applicable to Borrower’s business or facilities owned or
operated by Borrower, including laws relating to emissions, discharges,
releases or threatened releases of pollutants, contamination, chemicals, or
hazardous, toxic or dangerous substances, materials or wastes into the environment
(including, without limitation, ambient air, surface water, ground water, land
surface or subsurface strata) or otherwise relating to the generation,
manufacture, processing, distribution, use, treatment, storage, disposal,
transport or handling of Hazardous Materials.


 


“Equipment” shall have the meaning set forth in the UCC.


 


“Equity Holders” means Knox Lawrence International and its
Affiliates and any other Person that owns at anytime, directly or indirectly,
Equity Interests in Borrower.


 


“Equity Interests” means the membership interests, limited
liability company interests, partnership interests, capital stock of any class
or any other equity interest of any Person and options, warrants and other
rights to acquire membership interests, limited liability company interests,
partnership interests, capital stock of any class or any other equity interest
of such Person.


 


“ERISA” shall mean the Employee Retirement Income
Security Act of 1974, as amended, modified or restated from time to time.


 


“Event of Default” shall mean the occurrence of any of the
events or conditions described in Section 9.


 


“Executive
Order”
shall have the meaning set forth in Section 5.21(a). 


 


“Financial
Covenants”
shall have the meanings set forth in Section 8.


 


“Financing
Statement”
shall mean a UCC-1 financing statement in form and substance satisfactory to
Lender.


 


“Fixed Charge
Coverage Ratio” shall have the meaning set forth in Section 8.2(a).


 


“Fixtures” as such term is defined in the UCC.


 


“GAAP”  shall mean generally accepted accounting principles in the United
States of America as consistently applied through all relevant periods.


 


“Governmental
Entity”
shall mean any federal, state, or local governmental or quasi-governmental
entity, agency, board, commission or organization having jurisdiction over any
Collateral or Person relevant to this Agreement.


 


4

















 


“Governmental
Requirements”
shall mean all laws, statutes, codes, ordinances, and governmental rules,
regulations and requirements applicable to Borrower, Lender and/or any
Collateral.


 


“Hazardous
Materials”
shall mean any hazardous, toxic or dangerous substance, materials and wastes,
including, without limitation, hydrocarbons (including naturally occurring or
man-made petroleum and hydrocarbons), flammable explosives, asbestos, urea
formaldehyde insulation, radioactive materials, biological substances,
polychlorinated biphenyls, pesticides, herbicides and any other kind and/or
type of pollutants or contaminants (including, without limitation, materials
which include hazardous constituents), sewage, sludge, industrial slag,
solvents and/or any other similar substances, materials, or wastes and
including any other substances, materials or wastes that are or become
regulated under any Environmental Law (including, without limitation any that
are or become classified as hazardous or toxic under any Environmental Law).


 


“Impositions” shall mean all (a) real estate and
personal property taxes and other taxes and assessments, water and sewer rates
and charges, and all other governmental charges and any interest or costs or
penalties with respect thereto and charges for any restrictive covenants or any
other easement or agreement maintained for the benefit of any Real Property,
general and special, ordinary and extraordinary, foreseen and unforeseen, of
any kind or nature whatsoever that at anytime may be assessed, levied or
imposed upon any land or improvements, or the rent or income received
therefrom, or any use or occupancy thereof, and (b) other taxes levied,
imposed or assessed upon or against Borrower or any of its properties.


 


“Indebtedness” shall mean (after consolidation adjustments,
if necessary, to avoid redundancy) (a) all indebtedness, obligations or
other liabilities for borrowed money, whether or not subordinated and whether
with or without recourse beyond any collateral security; (b) all
indebtedness, obligations or other liabilities evidenced by securities or other
similar instruments; (c) all reimbursement obligations and other
liabilities with respect to letters of credit (except for any undrawn letters
of credit that support future ordinary course, non-indebtedness obligations) or
banker’s acceptances; (d) all obligations to pay the purchase price of
real or personal property or services (offset by the fair value of such
property or services); (e) all Capital Lease Obligations and all
obligations in respect of operating leases; (f) all Accommodation
Obligations; (g) all indebtedness, obligations or other liabilities of any
Person secured by a Lien on any asset of Borrower, whether or not such
indebtedness, obligations or liabilities are assumed by, or are a personal
liability of, Borrower (including, without limitation, the principal amount of
any assessment or similar indebtedness encumbering any property); (h) all
indebtedness, obligations or other liabilities (other than interest expense
liability) in respect of any interest rate hedge, swap or similar contracts and
foreign currency exchange agreements; and (i) without duplication or
limitation, all liabilities and other obligations included in the financial
statements (or notes thereto) of Borrower as prepared in accordance with GAAP.


 


“Indemnitees” shall have the meaning set forth in Section 10.5.


 


“Inventory” shall have the meaning set forth in the UCC.


 


5

















 


“Investments” shall mean, with respect to any Person, (a) the
purchase or acquisition of, or making any commitment therefor, any capital
stock, equity interest, or any obligations or other securities of, or any
interest in, any other Person, including the establishment or creation of a
Subsidiary or entering into any joint ventures, or (b) making or
committing to make any acquisition of all or substantially all of the assets of
another Person, or of any business or division of any Person, including, by way
of merger, consolidation or other combination, or (c) making or committing
to make any advance, loan, extension of credit or capital contribution to or
any other investment in, any other Person including any Affiliate of Borrower.


 


“Involuntary
Lien”
shall mean any Lien securing the payment of money or the performance of any
other obligation created involuntarily under any law, rule, regulation,
ordinance or otherwise and any claim of any such Lien.


 


“Junior Deeds
of Trust”
shall mean the Junior Fee Deed of Trust and the Junior Leasehold Deeds of
Trust.


 


“Junior Fee
Deed of Trust” shall mean that certain Deed of Trust, Assignment of Leases and Rents,
Security Agreement, and Fixture Filing, dated of even date herewith, given by
Borrower, as trustor, in favor of Lender, as beneficiary.


 


“Junior
Leasehold Deeds of Trust” shall mean (a) that certain Deed of Trust, Assignment of Leases
and Rents, Security Agreement, and Fixture Filing, dated of even date herewith,
given by Borrower, as trustor, in favor of Lender, as beneficiary, related to
the property at 2282 South Presidents Drive, Suite B, West Valley City,
Salt Lake County, Utah 84120, and (b) that certain Deed of Trust, Assignment
of Leases and Rents, Security Agreement, and Fixture Filing, dated of even date
herewith, given by Borrower, as trustor, in favor of Lender, as beneficiary,
related to the property at 118 South 1000 West, Salt Lake City, Salt Lake
County, Utah 84104.


 


“Knox Lawrence
International” shall mean Knox Lawrence International, LLC, a Delaware limited
liability company.


 


“Legal Opinion” has the meaning set forth in Section 4.5(b).


 


“LIBOR Rate” shall mean the rate of interest equal to the
30-day LIBOR rate quoted by Lender (or a financial institution designated by
Lender) from Telerate Page 3750 or any successor thereto, which shall be
the 30-day LIBOR rate in effect two (2) Business Days prior to the
beginning of each calendar month, adjusted for any reserve requirement and any
subsequent costs arising from a change in government regulation, such rate to
be reset at the beginning of each succeeding month. If the advance of the Loan
Amount occurs other than on the first day of the month, the initial 30-day LIBOR
Rate shall be the 30-day LIBOR Rate in effect two (2) Business Days prior
to the date of the such advance, which rate plus the LIBOR Spread shall be in
effect the remaining days of the month in which such advance is made, such
30-day LIBOR rate to be reset at the beginning of each succeeding month. Lender’s
internal records of applicable interest rates shall be determinative in the
absence of manifest error.


 


“LIBOR Spread” shall mean ten percent (10%).


 


6

















 


“Lien”  and “Liens”
mean, respectively, each and all of the following: (i) any
assignment as security, conditional sale, grant in trust, lien, mortgage,
pledge, security interest, title retention arrangement, other encumbrance, or
other interest or right securing the payment of money or the performance of any
other liability or obligation, whether voluntarily or involuntarily created and
whether arising by agreement, document, or instrument, under any law,
ordinance, regulation, or rule (federal, state, or local); and (ii) any
option, right of first refusal, or other interest or right.


 


“Loan”  shall mean the term loan to Borrower in the amount of the Loan Amount
made pursuant to the terms of Section 2.


 


“Loan Amount” shall mean Three Million Dollars and No/100
($3,000,000.00).


 


“Loan Documents” shall mean any and all documents evidencing
and securing the Loan and shall include, without limitation, this Agreement,
the Note, the Security Agreement, the Financing Statement, the Subordination
Agreement, the Junior Deeds of Trust, those documents, instruments and
interests specifically identified in Section 4.2, and any other
agreements, documents or instruments evidencing, guarantying, securing or
otherwise relating to the Loan, as such agreements, documents and instruments
may be amended, modified, extended, renewed or supplemented from time to time.


 


“Loan
Origination Fee” shall have the meaning set forth in Section 2.7(a).


 


“Loan Party” shall mean Borrower and each other Person
that from time to time is or becomes obligated to Lender under any Loan
Document.


 


“Loan Quarter” shall mean each period of three (3) consecutive
calendar months, ending on March 31, June 30, September 30 and December 31,
respectively.


 


“Loss” shall have the meaning set
forth in Section 10.5.


 


“Material
Adverse Effect” shall mean (a) a material adverse change in, or a material
adverse effect upon, the assets, business, properties, condition (financial or
otherwise) or results of operations of Borrower and its Subsidiaries, if any,
taken as a whole, (b) a material impairment of the ability of any Loan
Party to perform any of the material Obligations under the Loan Documents, or (c) a
material adverse effect on (i) any material portion of the Collateral, (ii) the
legality, validity, binding effect or enforceability against the Loan Parties
under the Loan Documents, (iii) the perfection or priority of any Lien
granted to Lender under any Loan Document, or (iv) the rights or remedies
of Lender under the Loan Documents.


 


“Maturity Date” shall mean May 21, 2010 (i.e., 24
months after the date of this Agreement); provided, however, that Lender
may accelerate the Maturity Date at anytime as otherwise provided for in this
Agreement or in the Note.


 


“Net Worth” shall mean (a) the total assets of Borrower
as determined in accordance with GAAP and as reflected on the most recent
financial statements for Borrower delivered to Lender in accordance with Section 8.3,
less (b) all assets of Borrower that are either (i) non-qualified
deferred compensation plan assets contributed under Section 401(k) of
the Code


 


7

















 


and
related provisions and regulations or (ii) non-qualified deferred
compensation plan assets contributed under Section 457 the Code and
related provisions and regulations, and less (c) the total
liabilities of Borrower, excluding Borrower’s liabilities under the Consonus
Seller Note, as determined in accordance with GAAP, and as reflected on the
most recent financial statements for Borrower as delivered to Lender in
accordance with Section 8.3.


 


“Note”  shall mean that certain Secured Promissory Note, dated as of the date
hereof, in the original principal amount of the Loan Amount, made by Borrower
to the order of Lender, as the same may be modified, amended, extended,
replaced or restated.


 


“Notice”  shall have the meaning set forth in Section 10.6.


 


“Obligations” shall mean Borrower’s obligations in respect
of the due and punctual payment of principal and interest on the Note when and
as due, whether by acceleration or otherwise, and all fees, expenses,
indemnities, reimbursements and each other obligation of any Loan Party under
this Agreement or any other Loan Document, in all cases whether now existing or
hereafter arising or incurred.


 


“OFAC”  shall have the meaning set forth in Section 5.21(b)(v).


 


“Original
Credit Agreement” shall have the meaning set forth in the above Recitals.


 


“parties” and “party” have the meanings set
forth in the preamble.


 


“Permitted
Liens”
shall mean (a) Liens or security interests in favor of Lender; (b) Liens
and security interests in favor of U.S. Bank under the Amended and Restated
Credit Agreement and the Senior Notes; (c) Liens for Impositions that are
not delinquent; (d) Involuntary Liens (other than for Impositions) with
respect to which Borrower satisfies each of the following requirements: (i) Borrower
contests the validity of such Involuntary Lien in good faith by appropriate
legal proceedings, (ii) Borrower gives written notice to Lender of
Borrower’s intent to contest or object to the same, (iii) Borrower
demonstrates to Lender’s satisfaction that the procedures will conclusively
operate to prevent the sale of any property owned by Borrower to satisfy the
Involuntary Lien prior to the final determination of such proceedings, and (iv) Borrower
takes any and all other reasonable actions (including, without limitation,
obtaining bonds, title insurance endorsements, or other security) as Lender may
deem necessary or appropriate in order to prevent the sale of any of the Real
Estate to satisfy the Involuntary Lien and prevent any impairment of any of the
Real Estate; (e) the sale, transfer or other disposition of any personal
property that is consumed or worn out in ordinary usage and that is promptly
replaced with similar items of equal or greater value; (f) any Lien in
favor of Lender for the benefit of Lender; (g) matters customarily shown
as standard, pre-printed exceptions in a title insurance policy in the
jurisdiction where any of the Real Estate is located; (h) all covenants,
conditions, easements, right-of-ways, reservations and restrictions now of
record on any of the Real Estate; (i) any Lien arising after the date
hereof and approved by Lender in writing; (j) Liens arising in the
ordinary course of Borrower’s business in amounts not to exceed $50,000.00 for
any single Lien and $150,000.00 for all such Liens in the aggregate;


 


8

















 


and
(k) any other Liens consented to by Lender in advance in writing from time
to time in its sole and absolute discretion.


 


“Permitted Protest” means the right of Borrower or any of its
Subsidiaries to protest any Lien (other than any Lien that secures the
Obligations), taxes or payment (other than any payment that is part of the
Obligations), provided that (a) a reserve with respect to such obligation
is established on the books of Borrower or such Subsidiary in such amount as is
required under GAAP, (b) any such protest is instituted and diligently
prosecuted by Borrower or its Subsidiary, as applicable, in good faith, and (c)
Borrower’s title to its property is not materially adversely affected or its
use of such property in the ordinary course of its business is not materially
interfered with.


 


“Person” shall mean any natural person, corporation,
limited liability company, partnership (whether limited or general), joint
venture, firm, association, trust, unincorporated organization, government or
governmental agency or political subdivision or any other entity, whether
acting in an individual, fiduciary or other capacity.


 


“Rate Contracts” means swap agreements (as such term is
defined in Section 101 of the Federal Bankruptcy Reform Act of 1978 (11
U.S.C. § 101, et seq.), as amended, reformed or modified from time to time and any rules or
regulations issued from time to time thereunder) and any other agreements or
arrangements designed to provide protection against fluctuations in interest or
currency exchange rates, including any agreement or arrangement that is a rate
swap, basis swap, forward rate transaction, commodity swap, commodity option,
equity or equity index swap, equity or equity index option, bond option,
interest rate option, foreign exchange transaction, cap transaction, floor
transaction, collar transaction, forward transaction, currency swap
transaction, cross-currency rate swap transaction, currency option or any other
similar transaction (including any option with respect to any of the
above-specified transactions) or any combination thereof, whether linked to one
or more interest rates, foreign currencies, commodity prices, equity prices or
other financial measures.


 


“Real Estate” shall mean the real property and
improvements owned or leased by Borrower and pledged to Lender as security for
the Loan pursuant to the Loan Documents, as such real property and improvements
are more particularly described therein.


 


“Regulatory Change” shall mean any change after the Closing Date
in federal, state or foreign laws, rules or regulations or the adoption or
making after that date of any interpretations, directives or requests applying
to a class of banks, including Lender, under any federal, state or foreign
laws, rules or regulations (whether or not having the force of law) by any
court, Governmental Entity or monetary authority charged with the
interpretation or administration thereof.


 


“Security Agreement” shall mean that certain Security Agreement
dated effective as of the date hereof from Borrower to Lender granting a valid
and perfected first lien on the Collateral described therein, securing the Note
and other Obligations, in form and substance satisfactory to Lender, as it may
be amended, modified, extended, renewed, restated or supplemented from time to
time.


 


9

















 


“Senior Debt
Cap” shall
mean Fifteen Million Dollars and No/100 ($15,000,000.00).


 


“Senior
Indebtedness”
means the Indebtedness of Borrower to U.S. Bank under the Amended and Restated
Credit Agreement and the Senior Notes.


 


“Senior Notes” shall mean (a) the Term Note in the original
principal amount of Ten Million Five Hundred Thousand Dollars and No/100
($10,500,000.00) dated May 31, 2005 made by Borrower in favor of U.S.
Bank, (b) the Line of Credit Note in the principal amount of Two Million
Five Hundred Thousand Dollars and No/100 ($2,500,000.00) dated May 31,
2005 made by Borrower in favor of U.S. Bank, and (c) the Term Note in the
principal amount of One Million Eight Hundred Sixty-One Thousand Dollars and
No/100 ($1,861,000.00) dated November 19, 2007 made by Borrower in favor
of U.S. Bank.


 


“Subordination
Agreement”
shall mean that certain Subordination and Standstill Agreement, dated as of the
date hereof, executed by Lender in favor of U.S. Bank, subordinating the
obligations of Borrower to Lender under the Note and the Junior Deeds of Trust
to the obligations of Borrower under the Amended and Restated Credit Agreement,
in form and substance acceptable to Lender.


 


“Subsidiary” shall mean a corporation, partnership, joint
venture or other entity in which Borrower, or one or more of its Subsidiaries,
or any combination of the foregoing own, directly or indirectly, (a) either
fifty percent (50%) or more of the issued and outstanding shares of capital
stock or fifty percent (50%) or more of the issued and outstanding capital
stock having ordinary voting power to elect a majority of the Board of
Directors of such entity (irrespective of whether or not at the time capital
stock of any other class or classes of such entity shall or might have voting
power upon the occurrence of any contingency), or (b) a fifty percent
(50%) or greater interest in any partnership, joint venture or other entity,
whether such interest is an interest in the capital, profits, losses or
distributions of such partnership, joint venture or other entity.


 


“Total Funded
Debt Ratio”
shall have the meaning set forth in Section 8.2(b). 


 


“UCC” shall mean the Uniform
Commercial Code adopted in the State of Utah. 


 


“UFCA”  shall have the meaning set forth in Section 5.5.


 


“UFTA”  shall have the meaning set forth in Section 5.5.


 


“USA Patriot
Act” shall
have the meaning set forth in Section 5.21(a).


 


“U.S. Bank” shall mean U.S. Bank National Association, a
Minnesota corporation.


 


1.2                                 Accounting Terms and Calculations. Except as may be expressly provided to the
contrary herein, all accounting terms used herein shall be interpreted and all
accounting determinations hereunder shall be made in accordance with GAAP
applied in a manner consistent with the financial statements delivered pursuant
to Section 8.3.


 


10

















 


1.3                               Computation of Time Periods. In this Agreement, in the computation of a
period of time from a specified date to a later specified date, unless
otherwise stated the word “from” means “from and including” and the word “to”
or “until” each means “to but excluding”.


 


1.4                               Other Definitional Terms. The words “hereof’, “herein” and “hereunder”
and words of similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this Agreement.
References to Sections, Exhibits, Schedules and like references are to this
Agreement unless otherwise expressly provided. The words “include”, includes”
and “including” shall be deemed to be followed by the phrase “without limitation.”


 


SECTION 2 


TERM LOAN


 


2.1                               Term Loan. Subject to the satisfaction of the conditions precedent set forth in Section 4,
Lender shall make a single advance term loan to Borrower at the Closing in the
amount of the Loan Amount.


 


2.2                               Non-Revolving Loan. The Loan is not a revolving loan. Amounts
repaid under the Loan shall not be available for re-borrowing by Borrower.


 


2.3                               The Note. The Loan is evidenced by the Note, the form of which is attached
hereto as Exhibit “B”. The Loan Amount shall be evidenced by and be
repayable in accordance with the terms set forth in this Agreement.


 


2.4                               Interest; Applicable LIBOR Rate. Interest shall be calculated on the actual
number of days the Loan is outstanding on the basis of a year consisting of 360
days. In calculating interest, the date the Loan is made shall be included and
the date the Loan or any portion thereof is repaid shall be excluded if
received by Lender before 12:00 noon Mountain Time. The Note and all of the
other Obligations shall bear interest at the Applicable LIBOR Rate.


 


2.5                               Maturity Date. The Note shall be due and all outstanding
principal of, all accrued interest on and all other Obligations hereunder shall
be fully payable on the Maturity Date. Lender may accelerate the Maturity Date
if, as and when expressly provided in this Agreement and the other Loan
Documents.


 


2.6                               Prepayment; Application of Payments.


 


(a)                                  Prepayments. Borrower shall have the right to prepay the Loan in whole or in part
at anytime prior to the Maturity Date; provided, however, that Borrower
shall pay a prepayment premium as follows:


 


11

















 




	
  Prepayments
  Made During

  	
   

  	
  Prepayment
  Premium

  
	
   

  	
   

  	
   

  
	
  Months
  1 – 12

  	
   

  	
  3%
  of amount prepaid

  
	
   

  	
   

  	
   

  
	
  Months
  13 – 18

  	
   

  	
  1%
  of amount prepaid

  
	
   

  	
   

  	
   

  
	
  Thereafter

  	
   

  	
  No
  prepayment premium

  






 


All
prepayments shall be accompanied by a payment of interest accrued on the
portion of the Loan prepaid through the date of payment, and all partial
prepayments shall be applied to principal installments in the inverse order of
their maturity.


 


2.7                                     Fees.


 


(a)                                  Loan Origination Fee. Borrower shall pay Lender an origination
fee equal to one and one-half percent (1.50%) of the Loan Amount (i.e., Forty-Five
Thousand Dollars and No/100 ($45,000.00)) (the “Loan Origination Fee”)
for the Loan. Borrower previously paid Lender one-half of the Loan Origination
Fee (i.e.,
$22,500.00) upon the execution of the commitment letter,
which amount is non-refundable. The remaining one-half of the Loan Origination
Fee (i.e.,
$22,500.00) shall be paid by Borrower to Lender at the
Closing and shall be deemed fully earned by Lender upon the execution of this
Agreement.


 


(b)                                 Default Rate. After the occurrence of an Event of
Default, the Obligations outstanding on the Loan shall bear interest at the
Applicable LIBOR Rate plus one and one-half percent (1.5%).


 


2.8                                 Cross Default. Borrower agrees that any Event of Default
under the Amended and Restated Credit Agreement or any of the Senior Notes
shall be an Event of Default under this Agreement and the Note.


 


SECTION 3 


GENERAL LOAN PROVISIONS


 


3.1                                 Time and Place of Payments; Monthly Payments. Payments required under the Loan shall be
made in cash or other good funds immediately available at the offices of Lender
at 420 East South Temple, Suite 520, Salt Lake City, Utah 84111, or any
other address specified in writing to Borrower, prior to 2:00 p.m.
Mountain Time on the date due. Payments received after said time shall be
deemed received on the next Business Day. If any payment date falls on any day
that is not a Business Day, such payment date shall be extended to the next
Business Day. All such payments shall be made without deduction for, set-off,
counterclaim or other defense of any kind. The Loan shall be paid in eight (8) quarterly
principal payments in the amount of One Hundred Thousand Dollars and No/100
($100,000.00) each, commencing on July 1, 2008, and continuing on the same
day of each successive calendar quarter thereafter through the Maturity Date.
On the Maturity Date the remaining unpaid principal balance of the Loan shall
be repaid in full. Accrued interest on the Loan calculated at the Applicable
LIBOR Rate, shall be paid monthly commencing on June 1, 2008, and
continuing on the same day of each successive month thereafter through the
Maturity Date, at which time all accrued interest together with any other
amount due and payable hereunder shall be paid in full.


 


12

















 


3.2                                 Costs and Expenses. Borrower shall pay the following costs and
expenses incurred in connection with the making of the Loan:


 


(a)                                  Attorneys’ Fees, Costs and Expenses. All reasonable out-of-pocket costs and
expenses incurred by Lender (including, without limitation, fees, costs and
expenses for Lender’s counsel) to be paid on or before the date hereof with
respect to the Closing.


 


(b)                                 Consultants’ Costs, Expenses and Fees. All reasonable out-of-pocket costs and
expenses incurred by Lender (including, without limitation, the aggregate costs
of any appraisals of any portion of the Collateral (provided that so long as no
Event of Default has occurred and is continuing, Borrower shall only be
obligated to pay for the costs of one appraisal of the Collateral during each
twelve (12) month period), consultants’ fees, attorneys’ fees and costs, or
other costs and expenses reasonably incurred by Lender in connection with
review or approval of Collateral, enforcing payment and performance of the
Obligations, exercising the rights and remedies of Lender under the Loan
Documents or in negotiation or documentation of any further amendment or
modification of the Loan Documents), to be paid on or before the tenth (10th)
Business Day after any bill rendered by Lender to Borrower with respect
thereto, paid directly or to reimburse Lender, at Lender’s option.


 


3.3                                 Lender’s Right to Cure Defaults. In the event that Borrower shall fail to
cure a Default, Lender shall have the right, but not the obligation, to perform
any of such covenants, agreements and obligations, and any amounts expended by
Lender in doing so shall constitute obligatory advances under this Agreement
and additional Obligations evidenced by the Note and secured by the Loan
Documents.


 


3.4                                 Effect of Loan Documents. All amounts hereafter advanced or accruing,
including, without limitation, any amounts (including principal amounts)
advanced or outstanding hereunder in excess of the stated principal amount of
the Note, if any, shall be outstanding under the Note and shall be evidenced
and secured by the Loan Documents.


 


3.5                                 Lender Call Option upon Refinancing or
Modification of Senior Indebtedness. Lender shall have the option to call the Note and all Obligations
hereunder immediately due and payable in full (the “Call Option”)
upon (a) any refinancing of the Senior Indebtedness or the Senior Notes
prior to the Maturity Date, or (b) any restructuring, amendment or
modification of or to the Senior Indebtedness or the Senior Notes that would
cause the Loan or any of the Obligations to be subordinated to or to become
junior to any other debt, liability or obligation of Borrower to Lender except
as provided by the Subordination Agreement. Borrower shall give Lender at least
ten (10) business days written notice prior to the closing of any
transaction that involves any restructuring, amendment or modification of or to
the Senior Indebtedness or the Senior Notes. Notwithstanding the foregoing,
Lender shall not have the right to exercise the Call Option if any such
refinancing, restructuring, amendment or modification of the Senior
Indebtedness or the Senior Notes is on terms which, taken as a whole, are no
less favorable to Borrower in any material respect.


 


13














 


SECTION 4


CONDITIONS PRECEDENT TO CLOSING


 


Lender’s
obligations to make the Loan and to enter into and perform its agreements under
this Agreement are subject to the full and complete satisfaction of the
following conditions precedent, including receipt and approval by Lender of the
following agreements, documents and instruments, each in form and substance
satisfactory to Lender, in each case as determined by Lender in its sole and
absolute discretion on or before the Closing and subsequently:


 


4.1           Representations and Warranties Accurate.  The
representations and warranties by each Loan Party in the Loan Documents shall
be correct in all material respects on and as of the date of this Agreement
(other than those that relate to an earlier date).


 


4.2           Loan Documentation.  Lender
shall have received and approved fully executed counterparts of the following
documents, each of which shall have been duly authorized, executed (and, where
appropriate, acknowledged), and delivered by the respective parties thereto, as
well as any and all other documents and instruments as Lender may deem
reasonably necessary with respect to the Loan:


 


(a)                                       this Agreement;


 


(b)                                      the Note;


 


(c)                                       the Security Agreement;


 


(d)                                      the Subordination Agreement;


 


(e)                                       the Junior Deeds of Trust;


 


(f)                                         the Financing Statement; and


 


(g)                                      the Compliance Certificate.


 


All
documentation evidencing the foregoing shall be in form and substance
reasonably satisfactory to Lender and shall include consents from such third
parties as Lender deems necessary or appropriate.


 


4.3                                 Closing of the Loan.  Lender
shall have received and approved fully executed copies of each of the Loan
Documents and all related documents and instruments deemed necessary or
appropriate by Lender. Each of the Loan Documents and all other documents and
instruments related to the Loan shall be in form and substance satisfactory to
Lender. The conditions of closing the Loan shall be satisfied by the parties
thereto without waiver or amendment except as approved by Lender in writing.


 


14

















 


4.4                                 Payment of Costs, Expenses and Fees.  All
costs, expenses and fees to be paid by Borrower under the Loan Documents on or
before the effectiveness of this Agreement shall have been paid in full.


 


4.5                                 Review Items.  Lender
shall have received and approved the following:


 


(a)                                       Financial Statements.  Internally
prepared unaudited financial statements of Borrower for the period ending December 31,
2007 and the first quarter of 2008, together with current financial statements
and other financial information as Lender may require for Borrower in form and
substance satisfactory to Lender; and


 


(b)                                      Legal Opinion.  A
legal opinion (the “Legal Opinion”) of independent
counsel for Borrower, with respect to the Loan Documents, in form and substance
reasonably satisfactory to Lender and Borrower’s counsel addressing (i) that
Borrower is validly existing and in good standing in the state of its
organization and, to the extent necessary, duly-qualified to do business in
each other state or jurisdiction in which it is required to qualify to do
business, (ii) that the Loan transaction and the execution and delivery of
the Loan Documents and performance of the obligations thereunder have been duly
authorized by all necessary parties, (iii) concerning such other legal
matters as Lender may require regarding the Loan transaction and the absence of
conflicts with the Loan Documents and any other material document, instrument,
agreement or governmental order or rule to which Borrower is a party or
subject and known to such counsel, and (iv) such other opinions specific
to Borrower or the Loan transaction as Lender may reasonably require.


 


4.6                                 Corporate Documents.  Borrower shall provide Lender with (i) certified
copies of resolutions of its board of directors authorizing it to execute,
deliver and perform each of the Loan Documents and to grant to Lender the Liens
on the Collateral as provided by the Loan Documents and certifying the names
and signatures of the officers of Borrower authorized to execute the Loan
Documents, (ii) the Certificate of Incorporation and Bylaws of Borrower
and all amendments thereto, and (iii) a certificate of good standing as a
corporation from the State of Delaware and from the State of Utah as to its
qualification to do business as a foreign corporation.


 


4.7                                 Taxes.  Evidence that all taxes, fees
and other charges in connection with the Loan or otherwise due and owing by
Borrower shall have been paid, and all delinquent taxes, assessments or other
governmental charges or liens affecting the Collateral, if any, shall have been
paid.


 


4.8                                 Insurance.  Certificates of insurance
evidencing the policies of insurance required hereunder.


 


4.9                                 Capital Structure.  Borrower
shall have received a payoff letter from Consonus, Inc. effective as of
the Closing Date indicating to Lender’s satisfaction that the Consonus Seller
Note will be repaid in full upon the closing of the transaction contemplated by
this Agreement and that no indebtedness will be outstanding or payable by Borrower
to Consonus, Inc. after the Closing.


 


15

















 


4.10                           Indebtedness; Liens; UCC Filings.


 


(a)                                       Evidence that: (A) all commitments under
any existing credit facilities or loan agreements not permitted under Section 7.8
have been terminated not later than the Closing Date, and all outstanding
amounts thereunder paid in full; and (B) all Liens securing obligations under such existing credit facilities or
loan agreements and all other Liens not permitted under Section 7.8
have been released and terminated not later than the Closing Date;


 


(b)                                      Evidence that such UCC financing statements,
fixture filings and comparable foreign filings or registrations (appropriately
completed and executed) shall have been filed in such states and jurisdictions
as Lender may request to perfect the Liens granted to Lender under the Loan
Documents; and


 


(c)                                       UCC search certificates from the
jurisdictions in which UCC financing statements are to be filed pursuant to
clause (ii) above, reflecting no other financing statements or filings
that evidence Liens of other Persons in the Collateral, except for any such
Liens (A) that are expressly permitted by Section 7.7, or (B) that Lender has received a termination
statement pursuant to clause (i) above.


 


4.11                           Consent and Estoppel Certificates.  For
each leased site listed below, Borrower shall deliver to Lender a Consent and
Estoppel Certificate signed by the landlord of each such site that consents to
the encumbrance of such site by Lender and containing customary estoppel
provisions, in form and substance reasonably satisfactory to Lender: (a) 118
South 1000 West, Salt Lake City, Utah, (b) 180 East 100 South, Salt Lake
City, Utah, and (c) 2282 South Presidents Drive, West Jordan, Utah.


 


4.12                           Other Actions.  Borrower
shall have performed such other actions as Lender may reasonably require.


 


SECTION 5


REPRESENTATIONS AND WARRANTIES


 


In
order to induce Lender to make the Loan, Borrower represents, warrants and
covenants as follows, which representations, warranties and covenants shall be
true and correct as of the execution hereof and shall survive the execution and
delivery of the Loan Documents:


 


5.1                                 Oganization of Borrower; Authority to Enter
into Agreement.  Borrower is a corporation, duly formed and
validly existing and in good standing under the laws of the State of Delaware.
Borrower is duly qualified to do business and is in good standing in each
jurisdiction where the nature of its business makes such qualification
necessary and where the failure to so qualify precludes Borrower from enforcing
its material contracts. Borrower has full power and authority to enter into
this Agreement, to borrow money as contemplated herein, and to execute and
carry out the provisions of the Loan Documents. The execution, delivery and
performance of the Loan Documents have been duly authorized by all necessary
action of each Loan Party and no other action of any Loan Party is required for
the execution, delivery and performance of the Loan Documents. The Loan Documents
that have been executed and delivered pursuant to this Agreement constitute,
or, if not yet executed or delivered, will when so executed and delivered,
constitute valid and binding obligations of each Loan Party, respectively, each
enforceable in


 


16

















 


accordance
with its respective terms, except as enforcement may be limited by equitable
principles or by bankruptcy, insolvency, reorganization, moratorium or similar
laws relating to or limiting creditors’ rights generally.


 


5.2                                 Financial Statements.  Any
financial statements, supporting schedules and financial reports delivered to
Lender in connection with the Loan Documents by or on behalf of a Loan Party
(including, without limitation, all financial statements required under Section 8.3)
are true and correct in all material respects, and, as to Borrower, have been
prepared in accordance with GAAP (except for the omission of footnotes and
normal year-end adjustments), and fairly represent in all material respects the
respective financial conditions of the subjects thereof as of the dates thereof
and for the periods covered thereby; provided, however, that it is
agreed and acknowledged that the financial statements provided pursuant to Section 4.5(a) were,
to the extent (and only to the extent) disclosed to Lender in writing prior to
Closing, not prepared in accordance with GAAP; provided further, however,
that all financial statements provided pursuant to Section 8.3
shall be fully GAAP compliant as required therein (except for the omission of
footnotes and normal year-end adjustments).


 


5.3                                 Litigation.  There are no actions, suits or
proceedings pending, or to the knowledge of any Loan Party, threatened against
or affecting any Loan Party, or any of the property or assets of any Loan
Party, in any court at law or in equity, or before or by any governmental or
municipal authority that could reasonably be expected to materially adversely
affect the ability of the Loan Party to perform its respective obligations
hereunder or under any of the Loan Documents to which the Loan Party is a
party, or could reasonably be expected to affect the priority of Lender’s liens
and security interests with respect to Borrower’s property or assets, except as
disclosed to Lender in writing prior to the date of this Agreement.


 


5.4                                 Subsidiaries.  There
are no Subsidiaries owned directly or indirectly by Borrower, other than those
identified in Schedule 5.4 attached hereto.


 


5.5                                 Use of Proceeds.  The
purpose of the Loan is a business purposes and not a personal, family or
household purposes. The proceeds of the Loan shall be used solely to retire and
repay in its entirety the Consonus Seller Notes. No part of the proceeds of the
Loan shall be used at anytime by Borrower to purchase or carry margin stock
(within the meaning of Regulation U promulgated by the Board of Governors of
the Federal Reserve System) or to extend credit to others for the purpose of
purchasing or carrying any margin stock. Borrower is not engaged principally, or
as one of its important activities, in the business of extending credit for the
purpose of purchasing or carrying any such margin stock. No part of the
proceeds of the Loan will be used by Borrower for any purpose that violates, or
that is inconsistent with, any regulations promulgated by the Board of
Governors of the Federal Reserve System.


 


5.6                                 Solvency.  Before and after giving effect
to the Loan, Borrower (a) is not “insolvent” as that term is defined in Section 101(32)
of the Bankruptcy Code, Section 2 of the Uniform Fraudulent Transfer Act
(the “UFTA”) or Section 2 of the
Uniform Fraudulent Conveyance Act (the “UFCA”), (b) does
not have “unreasonably small capital,” as that term is used in Section 548(a)(2)(B)(ii) of
the Bankruptcy Code or Section 5 of the UFCA, (c) is not engaged or
about to engage in a business or a transaction for which its remaining property
is “unreasonably small” in relation to such business or transaction as that
term is used in Section 4


 


17

















 


of
the UFTA, (d) able to pay its debts as they mature or become due, within
the meaning of Section 548(a)(2)(B)(iii) of the Bankruptcy Code, Section 4
of the UFTA and Section 6 of the UFCA, and (e) owns assets having a
value both at “fair valuation” and at “present fair salable value” greater than
or equal to the amount required to pay such Person’s “debts” as such terms are
used in Section 2 of the UFTA and Section 2 of the UFCA. Borrower
will not be rendered insolvent (as such term is defined above) by the execution
and delivery of this Agreement or any of the other Loan Documents or by the
transactions contemplated hereunder or thereunder.


 


5.7                                 No Violation of Other Agreements; No Default.  The
execution, delivery and performance by any Loan Party of the Loan Documents
will not (a) violate any provision of any Governmental Requirement or any
order, writ, judgment, injunction, decree, determination or award of any court,
Governmental Entity or government agency or arbitrator presently in effect having
applicability to any Loan Party, or (b) result in a breach of, or
constitute an event of default under, any indenture, deed of trust, mortgage,
credit facility or loan agreement (including, without limitation, the Amended
and Restated Credit Agreement and the Senior Notes), note or any other material
agreement, lease or instrument to which the Loan Party is a party or by which
it or any of its assets or properties may be bound or result in the creation of
any Lien or security interest thereunder. No Loan Party is in default under or
in violation of any such Governmental Requirement, order, writ, judgment,
injunction, decree, determination or award or any such indenture, loan or
credit agreement or other agreement, lease or instrument in any case in which
the consequences of such default or violation could reasonably be expected to
have a Material Adverse Effect on such Loan Party.


 


5.8                                 Government Consents.  No
material order, consent, approval, license, authorization or validation of, or
filing, recording or registration with, or exemption by, any Governmental
Entity is required on the part of any Loan Party to authorize, or is required
in connection with the execution, delivery and performance of, or the legality,
validity, binding effect or enforceability of, the Loan Documents, except for
any necessary filing or recordation of or with respect to any of the Loan
Documents.


 


5.9                                 Accuracy of Information.  All
reports, inventories, schedules, statements, verifications and other
information provided by or on behalf of any Loan Party to Lender pursuant to
this Agreement or in connection with the Loan are and shall be true, accurate,
complete and correct in all material respects as of the dates the same are
provided to Lender (other than those that relate to an earlier date) and do not
and shall not contain any untrue statement of material fact or omit to state a
fact necessary to make the statements therein not misleading in light of the
circumstances under which they were made; provided, however, that any projections
provided by any Loan Party to Lender represent as of the date of delivery, such
Loan Party’s good faith estimate of its future performance for the periods
covered thereby. Each Loan Party agrees to promptly notify Lender in the event
that any of such documentation or information is later discovered by such Loan
Party to be materially inaccurate.


 


5.10                           Good Faith; Bankruptcy.  This
Agreement is executed in good faith by each Loan Party and is not given or
intended to hinder, delay or defraud any creditor or to contravene any of the
bankruptcy laws of the United States (11 U.S.C. Section 101, et seq.), or any other applicable laws. As of the date of the execution of this
Agreement, no Loan Party is the subject of a


 


18

















 


pending
bankruptcy case. No Loan Party is aware of any threatened bankruptcy case, nor
are any Loan Parties presently intending to file such a case.


 


5.11                           Taxes.  Each Loan Party has filed all
federal, state and local tax returns required to be filed and has paid or made
provision (as required by GAAP) for the payment of all taxes due and payable
pursuant to such returns and pursuant to any assessments made against it or any
of its property and all other taxes, fees and other charges imposed on it or
any of its property by any governmental authority (other than taxes, fees or
charges the applicability, amount or validity of which is currently being
contested in good faith by appropriate proceedings and with respect to which
reserves in accordance with GAAP have been provided on the books of such Loan
Party). No tax liens (other than liens subject to Permitted Protest) have been
filed and no material claims are being asserted with respect to any such taxes,
fees or charges. The charges, accruals and reserves on the books of any Loan
Party in respect of taxes and other governmental charges are adequate, and the
Loan Parties know of no proposed material tax assessment against it or any
basis therefor.


 


5.12                           Trademarks; Patents.  Borrower possesses or has the right to use all
of the patents, trademarks, trade names, service marks and copyrights, and
applications therefor, and all technology, know-how, processes, methods and
designs used in or necessary for the conduct of its business, to its knowledge
without conflict with or infringement on the rights of others, except as could
not reasonably be expected to result in a Material Adverse Effect.


 


5.13                           Collateral.  Borrower is, or will be after
the closing of the Loan, the lawful owner of or lessee of all Collateral, free
from all Liens, other than Permitted Liens.


 


5.14                           Approvals and Permits; Compliance With Laws.  Borrower
has obtained and there are in full force and effect all consents, franchises,
certificates, licenses, authorizations, approvals and permits necessary for the
conduct of the business of Borrower, other than those consents, franchises,
certificates, licenses, authorizations, approvals and permits that if not
obtained or not in effect would not have a Material Adverse Effect. Borrower
owns or leases all assets and property necessary for conduct of the business
and operations of Borrower. Such assets and property are not subject to any
Liens, other than Permitted Liens. Borrower is in compliance in all material
respects with all applicable federal, state, local and foreign statutes, laws,
orders, regulations, rules and ordinances (including, without limitation,
Environmental Laws and statutes, laws, orders, regulations, rules and
ordinances relating to taxes, employer and employee contributions and similar
items, securities, ERISA or employee health and safety) the failure to comply
with which would have a Material Adverse Effect on Borrower.


 


5.15                           Indebtedness.  Except as permitted in Section 7.8,
Borrower is not obligated (directly or indirectly), for any Indebtedness.


 


5.16                           Environmental Matters.  Borrower
has no knowledge of any generation, use, storage, treatment, transportation,
manufacturing, handling, production or disposal of any Hazardous Materials, on
or off its premises (whether or not owned by Borrower) in any manner that at
anytime violates any Environmental Law in any material respect or any license,
permit, certificate, approval or similar authorization thereunder in any
material respect and the operations of Borrower comply in all material respects
with all Environmental Laws and all


 


19

















 


licenses,
permits, certificates, approvals and similar authorizations thereunder other
than those that could not reasonably be expected to result in a Material
Adverse Effect. There has been no investigation, proceeding, complaint, order,
directive, claim, citation or notice by any governmental authority, nor is any
pending or to the best of Borrower’s knowledge threatened with respect to any non-compliance
with or violation of the requirements of any Environmental Law by Borrower or
the release, spill or discharge, (threatened or actual) of any Hazardous
Materials or the generation, use, storage, treatment, transportation,
manufacture, handling, production or disposal of any Hazardous Materials or any
other environmental, health or safety matter, that affects Borrower or its
business, operations or assets or any properties at which Borrower has
transported, stored or disposed of any Hazardous Materials. Borrower has no
knowledge of any material liability (contingent or otherwise) in connection
with a release, spill or discharge (threatened or actual) of any Hazardous
Materials or the generation, use, storage, treatment, transportation, manufacture,
handling, production or disposal of any Hazardous Materials in connection with
any property owned or leased by Borrower.


 


5.17                           ERISA Matters.  Borrower
has paid and discharged all obligations and liabilities arising under ERISA of
a character that, if unpaid or unperformed, might result in the imposition of a
lien against any of its properties or assets.


 


5.18                           Regulatory Matters.  None
of any Loan Party or any Person controlling any Loan Party, is (a) an “investment
company” within the meaning of the Investment Company Act of 1940, as amended;
or (b) subject to regulation under the Federal Power Act, the Interstate
Commerce Act, any state public utilities code, or any other federal or state
statute or regulation limiting its ability to incur Indebtedness.


 


5.19                           Labor Relations.  There
are no strikes, lockouts or other general labor disputes against Borrower, or,
to Borrower’s knowledge, threatened against or affecting Borrower, in any case
that could reasonably be expected to have, either individually or in the
aggregate, a Material Adverse Effect, and no significant unfair labor practice
complaint is pending against Borrower or, to the knowledge of Borrower,
threatened against Borrower before any Governmental Entity in any case that
could reasonably be expected to have, either individually or in the aggregate,
a Material Adverse Effect. Borrower has at all times operated its business in
compliance in all material respects with all applicable provisions of the
Federal Fair Labor Standards Act, as amended.


 


5.20                           Brokers’ Fees; Transaction Fees.  Borrower
does not have any obligation to any Person in respect of any finder’s, broker’s
or investment banker’s fee or other fee in connection with the transactions
contemplated hereby, including any finder’s, broker’s or investment banker’s
fee in connection with the transactions contemplated hereby (except to Knox
Lawrence International or its Affiliates not to exceed One Hundred Thousand
Dollars and No/100 ($100,000.00)).


 


5.21                           Anti-Terrorism Laws.


 


(a)           Neither Borrower nor any of its
Affiliates is in violation of any laws relating to terrorism or money
laundering (collectively, the “Anti-Terrorism Laws”), including
Executive Order No. 13224 on Terrorist Financing, effective September 24,
2001 (the


 


20

















 


“Executive
Order”), and the Uniting and Strengthening America by
Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of
2001, Public Law 107-56, signed into law October 26, 2001 (the “USA Patriot Act”).


 


(b)                                 Neither Borrower nor any or its Affiliates,
nor, to the knowledge of  Borrower, any
brokers or other agents of any such Person acting or benefiting in any capacity
in connection with the Loan, is any of the following:


 


(i)                                          a Person that it listed in the annex to, or
is otherwise subject to the provisions of, the Executive Order;


 


(ii)                                       a Person owned or controlled by, or acting
for or on behalf of, any Person that is listed in the annex to, or is otherwise
subject to the provisions of, the Executive Order;


 


(iii)                                    a Person with which Lender is prohibited from
dealing or otherwise engaging in any transaction by any Anti-Terrorism Law;


 


(iv)                                   a Person that commits, threatens or conspires
to commit or supports “terrorism”, as that term is defined in the Executive
Order; or


 


(v)                                      a Person that is named as a “specially
designated national and blocked person” on the most current list published by
the United States Treasury Department Office of Foreign Assets Control (the “OFAC”) at its official web site or any replacement
web site or other replacement official publication of such list.


 


(c)                                  Neither Borrower nor any of its Affiliates,
nor, to its knowledge, any broker or other agent of any such Person acting or
benefiting in any capacity in connection with the Loan (i) conducts any
business or engages in making or receiving any contribution of funds, goods or
services to or for the benefit of any Person described in clause (b) above,
(ii) deals in, or otherwise engages in any transaction relating to, any
property or interests in property blocked pursuant to the Executive Order, or (iii) engages
in or conspires to engage in any transaction that evades or avoids, or has the
purpose of evading or avoiding, or attempts to violate, any of the prohibitions
set forth in any Anti-Terrorism Law.


 


5.22                           Material Adverse Effect.  No
event has occurred that had or could reasonably be expected to have a Material
Adverse Effect.


 


5.23                           Fixtures. Except as set forth on Schedule 5.23 attached hereto, no
Equipment owned or leased by Borrower or any Subsidiary is a Fixture to any
parcel of real property.


 


5.24                           Payoff of Adjustment Note.  The
Adjustment Note dated August 5, 2005 in the original principal amount of
Two Million Eight Hundred Thousand Dollars and No/100 ($2,800,000.00) made by
Borrower in favor of Consonus, Inc. (the “Adjustment Note”) has been fully repaid and cancelled.


 


5.25                           Survival of Representations.  All
representations, warranties and covenants contained in this Section 5
shall survive the delivery of the Note and the Loan Documents, and


 


21

















 


the
making of the Loan, and any investigation at anytime made by or on behalf of
Lender shall not diminish its rights to rely on all of such representations and
warranties.


 


5.26                           Representations and Warranties Continuing.  Each
delivery by a Loan Party to Lender of financial statements, other documents,
instruments or information after the date of this Agreement shall constitute an
affirmation on the part of the Loan Parties that the representations and
warranties contained in this Section 5 are true and correct in all
material respects (except that such materiality qualifier shall not be
applicable to any representation or warranty that is already qualified or
modified by materiality in the text thereof) as of the time of such delivery
except as otherwise previously disclosed to Lender in writing in a notice and
except for those that refer to an earlier date. All representations and
warranties made in this Agreement shall be continuing until the Loan and all
Obligations of Borrower to Lender under this Agreement have been paid in full
and discharged.


 


SECTION 6


AFFIRMATIVE COVENANTS


 


Until
the Obligations are paid and performed in full, Borrower agrees that:


 


6.1                                 Books and Records; Periodic Audits.  Borrower
shall keep books and records reflecting all of its business affairs and
transactions in accordance with GAAP and permit Lender and its representatives
and agents at reasonable times and intervals and upon reasonable prior notice to
Borrower, to visit all of its offices, discuss its financial matters with
officers of Borrower and its independent public accountant (and by this
provision Borrower authorizes its independent public accountants to participate
in such discussions) and examine any of its books and other corporate records.
Such audits shall be at the expense of Borrower.


 


6.2                                 Collateral Inspections.  Borrower shall permit the duly authorized
agents of Lender to conduct an examination, appraisal or other inspection of
the Collateral. Borrower shall reasonably cooperate with Lender, make such
Collateral reasonably available to Lender for such examinations, and pay upon
demand such reasonable fees and costs Lender may incur in conducting the
examinations, appraisals or other inspections; provided, however, that
so long as no Event of Default has occurred and is continuing, Borrower shall
only be obligated to pay for the costs of one examination, appraisal or other
inspection of the Collateral during each twelve (12) month period.


 


6.3                                 Existence.  Borrower shall maintain its
existence as an entity in good standing under the laws of its jurisdiction of
formation and its qualification to transact business in each jurisdiction where
failure to qualify would preclude Borrower from enforcing its rights with
respect to any material asset or would expose Borrower to any material
liability.


 


6.4                                 Maintain Business.  Borrower
shall continue to primarily provide IT infrastructure, data center storage
solutions, and related managed services in the same manner as it engages on the
date of this Agreement.


 


6.5                                 Conduct of Business.  Borrower
shall maintain and keep its assets, property and equipment that are necessary
or useful to the conduct of its business in good repair, working


 


22

















 


order
and condition (ordinary wear and tear excepted) and from time to time make or
cause to be made all needed renewals, replacements and repairs.


 


6.6                                 Headquarters.  Borrower
shall maintain its headquarters in the State of Utah.


 


6.7                                 Payment of Taxes and Claims.  Borrower
shall promptly file all tax returns and reports that are required by applicable
law to be filed by it and pay promptly all lawful taxes and assessments imposed
upon Borrower or Borrower’s assets, including, without limitation, federal,
state and local employee benefits and taxes, income taxes, sales or use taxes
and general and special assessments; to pay promptly all claims for labor and
materials furnished with respect to any property of Borrower and to prevent the
filing of liens therefor; provided, however, that Borrower need not pay
any such taxes, assessments or claims so long as it is subject to a Permitted
Protest.


 


6.8                                 Insurance.  Borrower shall:


 


(a)                                     Keep the Collateral properly housed and insured
against loss or damage by fire, theft, explosion, sprinklers, collision (in the
case of motor vehicles) and such other risks as are customarily insured against
by Persons engaged in businesses similar to that of Borrower, with such
companies, in such amounts, with such deductibles, and under policies in such
form, as shall be satisfactory to Lender in its reasonable discretion. Borrower
will provide certificates to Lender with appropriate Lender designation as
additional insured or loss payee as may be appropriate together with evidence
of payment of all premiums therefor, and shall contain an endorsement, in form
and substance acceptable to Lender, showing loss under such insurance policies
payable to Lender. Such endorsement, or an independent instrument furnished to
Lender, shall provide that the insurance company shall give Lender at least
thirty (30) days written notice before any such policy of insurance is altered
or canceled and that no act, whether willful or negligent, or default of
Borrower or any other Person shall affect the right of Lender to recover under
such policy of insurance in case of loss or damage. In addition, Borrower shall
cause to be executed and delivered to Lender an assignment of proceeds of its
business interruption insurance policies. Borrower hereby directs all insurers
under all policies of insurance to pay all proceeds payable thereunder directly
to Lender; provided, however, that Lender will pay all proceeds payable
thereunder directly to Borrower unless a Default or Event of Default has
occurred and is continuing. Borrower irrevocably makes, constitutes and
appoints Lender (and all officers, employees or agents designated by Lender) as
Borrower’s true and lawful attorney-in-fact for the purpose of making, settling
and adjusting claims under such policies of insurance, endorsing the name of
Borrower on any check, draft, instrument or other item of payment for the
proceeds of such policies of insurance and making all determinations and
decisions with respect to such policies of insurance; provided, however,
that Lender will not take any such actions as Borrower’s attorney-in-fact
unless and until an Event of Default has occurred and is continuing.


 


(b)                                    Maintain, at its expense, such public
liability and third party property damage insurance as is customary for Persons
engaged in businesses similar to that of Borrower with such companies and in
such amounts, with such deductibles and under policies in such form as shall be
satisfactory to Lender in its reasonable discretion, and original (or
certified) copies of such policies shall be delivered to Lender, together with
evidence of payment of all premiums


 


23

















 


therefor;
each such policy shall contain an endorsement showing Lender as additional
insured thereunder and providing that the insurance company shall give Lender
at least thirty (30) days written notice before any such policy shall be
altered or canceled.


 


If
Borrower at anytime or times hereafter shall fail to obtain or maintain any of
the policies of insurance required above or to pay any premium relating
thereto, then Lender, without waiving or releasing any obligation or default by
Borrower hereunder, may (but shall be under no obligation to) obtain and
maintain such policies of insurance and pay such premiums and take such other
actions with respect thereto as Lender deems advisable. Such insurance, if
obtained by Lender, may, but need not, protect Borrower’s interests or pay any
claim made by or against Borrower with respect to the Collateral. Such
insurance may be more expensive than the cost of insurance Borrower may be able
to obtain on its own and may be cancelled only upon Borrower providing written
evidence that it has obtained the insurance as required above. All sums
disbursed by Lender in connection with any such actions, including, without
limitation, court costs, expenses, other charges relating thereto and
reasonable attorneys’ fees, shall constitute part of the Loan, shall be payable
on demand by Borrower to Lender and, until paid, shall bear interest at the
highest rate then applicable to the Loan.


 


6.9                                 Complying with the Loan Documents and Other
Documents.  Borrower shall comply in all material respects
with and perform all of its agreements and obligations under the Loan
Documents, and under all other material contracts and agreements to which
Borrower is a party and all material Governmental Requirements relating to the
ownership, occupancy, use or management of Borrower’s property (unless Borrower’s
obligation to comply therewith is being contested by Borrower in good faith,
with due diligence and in compliance with all applicable requirements, if any,
relating to such contests set forth in the Loan Documents).


 


6.10                           Compliance.  Borrower shall comply with all
Governmental Requirements and all orders, writs, judgments, injunctions,
decrees or awards to which it may be subject; provided, however, that
failure to comply shall not be a breach of this covenant if such failure does
not relate to any Collateral and does not have, or is not reasonably expected
to have, a Material Adverse Effect, and Borrower is acting in good faith and
with reasonable dispatch to cure such non-compliance.


 


6.11                           Payment of Claims. Borrower agrees to pay and discharge all
claims for labor performed and material and services furnished in connection
with the Collateral, and to take all other steps necessary to forestall the
assertion of claims or liens either against the Collateral, or any part thereof
or right or interest appurtenant thereto, or of claims against Lender. Nothing
herein contained shall require Borrower to pay any claims for labor, materials
or services that are subject to Permitted Protest. Lender shall not be required
to extend the Maturity Date of the Loan by reason of Borrower’s failure to pay
any such claims.


 


6.12                           Intellectual Property.  Borrower
shall maintain adequate licenses, patents, patent applications, copyrights,
service marks, trademarks, trademark applications and trade names necessary to
continue its business as heretofore conducted by it or as hereafter conducted
by it.


 


6.13                           Further Assurances.  Borrower
will at anytime and from time to time upon the request of Lender take or cause
to be taken any action, execute, acknowledge, deliver or record


 


24

















 


any
additional documents, instruments, opinions, trust deeds, mortgages, security
agreements or financing statements or obtain such additional insurance as
Lender in its reasonable discretion deems necessary or appropriate to carry out
the purposes of this Agreement and to preserve, protect and perfect the
security interests intended to be created and preserved in the Collateral and
other properties and assets securing the Obligations of Borrower under this
Agreement and the Loan Documents. Without limiting the generality of the
foregoing, but subject to the prohibitions set forth in Section 7.1,
Borrower shall cause each of its Subsidiaries to guaranty the Obligations and
to cause each such Subsidiary to grant to Lender a security interest in, and
Lien on, substantially all of such Person’s assets and property to secure such
guaranty, in each case pursuant to documents and instruments and other
conditions as Lender may reasonably require.


 


6.14                           Notices of Certain Events.  Each
Loan Party, each for itself, as soon as practicable, shall give written notice
to Lender of:


 


(a)                                       the commencement of any uninsured litigation
relating to any Loan Party or relating to the transactions contemplated by this
Agreement that, if adversely determined, would constitute a Material Adverse
Effect;


 


(b)                                      the commencement of any material arbitration
or governmental investigation or proceeding not previously disclosed by the
Loan Party to Lender in writing that has been instituted or, to the knowledge
of the Loan Party, threatened against any Loan Party or to which its properties
or assets are subject that, if determined adversely to the Loan Party would
constitute a Material Adverse Effect;


 


(c)                                       any adverse development that occurs in any
litigation, arbitration or governmental investigation or proceeding previously
disclosed by any Loan Party to Lender that, if determined adversely to any Loan
Party would constitute a Material Adverse Effect;


 


(d)                                      any change of Borrower’s name or the use of
any trade name, assumed name, fictitious business name or division name not
previously disclosed to Lender in writing;


 


(e)                                       the occurrence of any “reportable event” (as
that term is defined in ERISA) that might result in the termination if any
employee benefit plan covering any officers or employees of Borrower;


 


(f)                                         any investigation, proceeding, complaint,
order, directive, claim, citation or notice with respect to any non-compliance
with or violation of the requirements of any Environmental Law by Borrower or
the generation, use, storage, treatment, transportation, manufacture, handling,
production or disposal of any Hazardous Materials or any other environmental,
health or safety matter that affects Borrower or its business operations or
assets or any properties at which Borrower has transported, stored or disposed
of any Hazardous Materials;


 


(g)                                      the occurrence of any Default or any Material
Adverse Effect; or


 


(h)                                      the receipt of any oral or written notice,
consent, waiver or other communication from U.S. Bank or any of its Affiliates
or agents or representatives with respect


 


25

















 


to
the Senior Indebtedness (and Borrower shall promptly provide Lender with a copy
of any such written communication received).


 


6.15                           Certificates; Other Information.  Borrower
shall furnish to Lender:


 


(a)                                       promptly after the same are sent, copies of
all financial statements and reports that Borrower sends to holders of its
Equity Interests;


 


(b)                                      promptly upon receipt thereof, copies of any
reports submitted by Borrower’s certified public accountants in connection with
each annual, interim or special audit or review of any type of the financial
statements or internal control systems of Borrower made by such accountants,
including any comment letters submitted by such accountants to management of
Borrower in connection with their services; and


 


(c)                                       promptly upon receipt thereof, copies of any
notices of any breach, default or any event of default and other material
deliveries under the Senior Notes or any related document.


 


6.16                           Notice of Restructuring or Modification of
Senior Indebtedness.  Borrower will give Lender at least ten (10) business
days written notice prior to the closing of any transaction involving any
restructuring, amendment or modification of or to the Senior Indebtedness or
the Senior Notes.


 


6.17                           Payoff of Obligations upon Change of Control.  Borrower
shall repay the Obligations in full upon the occurrence of Change of Control,
unless waived by Lender in advance in its sole discretion.


 


SECTION 7


NEGATIVE COVENANTS


 


Until
the Obligations are paid and performed in full, Borrower covenants and agrees
with Lender as follows:


 


7.1                                 Investments.  Borrower shall not, and shall
not permit any Subsidiary to, make or permit to exist any Investment (including
any Investment in any Subsidiary), except:


 


(a)                                       advances to employees, officers and directors
of Borrower for travel and other expenses arising in the ordinary course of
Borrower’s business, in the aggregate at any one time not in excess of Twenty
Thousand Dollars and No/100 ($20,000.00);


 


(b)                                      (i) cash, (ii) short-term
obligations of, or fully guaranteed by, the United States of America, (iii) commercial
paper rated A-1 or better by Standard & Poors or P-1 or better by
Moody’s, (iv) demand deposit accounts maintained in the ordinary course of
business with commercial banks in the United States, (v) certificates of
deposit issued by and time deposits with, in each case commercial banks in the
United States having capital and surplus in excess of $250,000,000, and (vi) money
market funds that invest substantially all of their assets in the foregoing;


 


26






 


 


 










 


(c)           Investments in existence on the Closing
Date, in each case described in Schedule 7.1 attached hereto;


 


(d)           extensions of
trade credit;


 


(e)           Investments
received in settlement of amounts due to Borrower or any of its Subsidiaries
effected in the ordinary course of business or owing to Borrower or any of its
Subsidiaries as a result of insolvency proceedings involving an Account Debtor
or upon the foreclosure or enforcement of any Lien in favor of Borrower or its
Subsidiaries; and


 


(f)          Borrower or any Loan
Party may create a wholly-owned Subsidiary; provided, however, that
concurrently upon the creation of any such Subsidiary, (i) Borrower or the
applicable Loan Party shall cause such Subsidiary to: (A) deliver a
guaranty pursuant to which such Subsidiary shall guaranty all of the
Obligations; (B) enter into such security agreement or joinder agreement
to the Security Agreement, and take all other action as shall be required by
Lender, so as to create, perfect and protect a Lien in favor of Lender in all of
the assets and properties of such Subsidiary; (C) cause each document
(including each UCC financing statement and each filing with respect to
intellectual property owned by each such Subsidiary) required by applicable law
or reasonably requested by Lender to be filed, registered or recorded in order
to create in favor of Lender a valid, legal and perfected first-priority
security interest in and lien on the Collateral subject to the security
documents to be so filed, registered or recorded and deliver evidence thereof
to Lender; and (D) to the extent requested by Lender, deliver an opinion
of counsel in form and substance satisfactory to Lender with respect to such
Subsidiary and the matters set forth in this Section 7.1(f); and (ii) Borrower
shall, or shall cause the applicable Loan Party to (W) pledge to Lender
one hundred percent (100%) of the Equity Interests of such Subsidiary and
execute and deliver all documents and instruments required thereunder or
appropriate to perfect the security interest created thereby; (X) deliver
to Lender all stock certificates and other documents and instruments added to
the Collateral thereby free and clear of all Liens, accompanied by undated
stock powers or other instruments of transfer executed in blank; and (Y) cause
each document and instrument (including each UCC financing statement and each
filing with respect to intellectual property owned by such Subsidiary) required
by applicable law or reasonably requested by Lender to be filed, registered or
recorded in order to create in favor of Lender a valid, legal and perfected
first-priority security interest in and lien on the Collateral subject to the
security documents to be so filed, registered or recorded and deliver evidence
thereof to Lender.


 


7.2           Merger. Borrower shall
not, and shall not permit any Subsidiary to, merge or consolidate or enter into
any analogous reorganization or transaction with any Person, or liquidate, wind
up or dissolve itself (or suffer any liquidation or dissolution).


 


7.3           Sales and other Fundamental
Changes. Borrower shall not, and shall not permit any Subsidiary to, cause,
suffer or permit, voluntarily or involuntarily, Borrower or any Subsidiary to
enter into or offer or agree to: any sale, lease, sublease, assignment,
transfer, conveyance, exchange, spin off or other disposition of, individually
or in a series of related transactions, any of the material assets or
properties of Borrower or any of its Subsidiaries except sales of worn, damaged
or obsolete equipment in the ordinary course of business, the transfer of
Investments permitted in Section 7.1(b) in a manner not
prohibited by the terms of this


 


27

















 


Agreement,
and sales of Inventory in the ordinary course of business. Borrower shall not,
and shall not permit any Subsidiary to, amend its organizational documents in
any material respect or change its fiscal year or enter into a new line of
business materially different from the current business of Borrower.


 


7.4           Inconsistent Agreements. Borrower
shall not, and shall not permit any Subsidiary to, enter into any agreement
containing any provision that would be violated or breached by Borrower or any
Subsidiary in the performance of its obligations under any Loan Document.


 


7.5           Guarantees. Borrower
shall not, and shall not permit any Subsidiary to, guarantee, directly or
indirectly, the debt of any Person (except Borrower may guaranty debt of a
Subsidiary) without the prior written consent of Lender.


 


7.6           Negative Pledges. Borrower
shall not, and shall not permit any Subsidiary to, enter into any agreement,
bond, note or other documents or instrument with or for the benefit of any
Person other than Lender that would prohibit Borrower or any Subsidiary from
granting, or otherwise limit the ability of Borrower or any Subsidiary to
grant, to Lender any Lien on any Collateral.


 


7.7           Liens. Borrower
shall not, and shall not permit any Subsidiary to, directly or indirectly make,
create, incur, assume or permit to exist any assignment, pledge, mortgage, deed
of trust, security interest or other Lien of any nature in, to or against any
of its assets, other than Permitted Liens.


 


7.8           Restrictions on Other
Indebtedness. Borrower shall not, and shall not permit any
Subsidiary to, create, incur, assume or be or remain liable (contingently or
otherwise) with respect to any Indebtedness, other than:


 


(a)            Indebtedness to U.S. Bank under the Amended and
Restated Credit Agreement and evidenced by the Senior Notes;


 


(b)            Indebtedness to Lender arising under any of the Loan
Documents;


 


(c)            Indebtedness listed on Schedule 7.8 attached
hereto;


 


(d)            Indebtedness from borrowings in the ordinary course
of business in an amount not to exceed Fifty Thousand Dollars and No/100
($50,000.00) for any single borrowing and One Hundred Fifty Thousand Dollars
and No/100 ($150,000.00) for all such borrowings in the aggregate at anytime
outstanding;


 


(e)            Refinancings, renewals or extensions of Indebtedness
permitted under clause (b) above(and continuance or renewal of any
Permitted Liens associated therewith) so long as: (i) such refinancings,
renewals or extensions do not result in an increase in the then-existing
principal amount of, or interest rate with respect to, the Indebtedness so
refinanced, renewed or extended; (ii) such refinancings, renewals or
extensions do not result in a shortening of the average weighted maturity of
the Indebtedness so refinanced, renewed or extended, nor on terms or conditions
that, taken as a whole, are materially more burdensome or restrictive to Borrower;
and (iii) if the Indebtedness that is refinanced, renewed or extended was
subordinated


 


28

















 


in
right of payment to the Obligations, then the terms and conditions of the
refinancing, renewal or extension Indebtedness must include subordination terms
and conditions that are at least as favorable to Lender as those that were
applicable to the refinanced, renewed or extended Indebtedness;


 


(f)            Endorsement of instruments
or other payment items for deposit; and


 


(g)           Indebtedness composing
Investments permitted under Section 7.1.


 


7.9           Limitations on
Distributions; Management Fee; Restricted Payments. Borrower
shall not, and shall not permit any Subsidiary to: (a) declare or make any
dividend payment or other distribution of assets, properties, cash, rights,
obligations or securities on account of any shares of any class of its capital
stock, partnership interests, membership interests or other Equity Interests
(including warrants) in excess of fifty-percent (50%) of Borrower’s net income,
if permitted under the Senior Indebtedness, (b) purchase, redeem or
otherwise acquire for value any shares of capital stock, partnership interests,
membership interests or other Equity Interests of Borrower or any warrants,
rights or options to acquire such shares, Equity Interests or securities of
Borrower now or hereafter outstanding, or (c) make any payments in respect
of “earnouts” and similar payment obligations, in each case, other than
distributions by any Subsidiary to Borrower. Borrower shall not, and shall not
permit any Subsidiary to, pay any management fees (including without limitation
to any Affiliate) in excess of Two Hundred Fifty Thousand Dollars and No/100
($250,000.00) per year, or to pay any management salary or other compensation
(including without limitation to any managers or officers who are employed by
or owners of Borrower or any Affiliate thereof) other than (A) cash
compensation to board members in an aggregate amount not to exceed Fifty
Thousand Dollars and No/100 ($50,000.00) per director per fiscal year and (B) cash
compensation to other officers or employees that are not Affiliates (other than
as a result of becoming an officer or employee) so long as such compensation is
paid in the ordinary course of business and on such fair and reasonable terms
as would be obtainable by such Person in a comparable arm’s-length transaction.


 


7.10         Loan Proceeds. Borrower
shall not, and shall not permit any Subsidiary to, use any part of the proceeds
of the Loan, directly or indirectly, and whether immediately, incidentally or
ultimately, (a) to purchase or carry margin stock (as that term is defined
in Regulation U of the Board) or to extend credit to others for the purpose of
purchasing or carrying margin stock or to refund Indebtedness originally
incurred for such purpose, or (b) for any purpose that entails a violation
of, or that is inconsistent with, the provisions of Regulations T, U or X of
the Board.


 


7.11         Equipment. Borrower
shall not, and shall not permit any Subsidiary to, (a) permit any
Equipment to become a Fixture to any parcel of real property unless such real
property is owned by Borrower and is subject to a mortgage or deed of trust in
favor of Lender, or (b) permit any Equipment to become an accession to any
other personal property unless such personal property is subject to a Lien in
favor of Lender.


 


7.12         Affiliate Transactions. Borrower
shall not, and shall not permit any Subsidiary to, conduct, permit or suffer to
be conducted, transactions with Affiliates other than transactions for the
purchase or sale of Inventory or services in the ordinary course of business
pursuant to terms


 


29

















 


that
are no less favorable to Borrower than the terms upon which such transactions
would have been made had they been made to or with a Person that is not an
Affiliate.


 


7.13         Senior Notes. Borrower
shall not (a) make any payment or prepayment of principal or interest on
the Senior Notes in contravention of the Subordination Agreement or any other
Loan Document; (b) take any other action with respect to the Senior Notes
in contravention of the Subordination Agreement or any other Loan Document; or (c) omit
to give Lender prompt written notice of any notice (regardless of the form
thereof, whether written, oral or otherwise) received from U.S. Bank or any
other holder of the Senior Notes or any interest therein, including any notice
of any default under any agreement, document or instrument relating thereto by
reason whereof the Senior Notes might become or be declared to be due or
payable. Borrower shall not enter into or consent to any material amendment,
modification or alteration of the Amended and Restated Credit Agreement or the
Senior Notes or otherwise amend, modify, cancel or supplement in any respect
any material provision of the Amended and Restated Credit Agreement or the
Senior Notes.


 


7.14         No Assignment. Borrower
shall not, and shall not permit any Subsidiary to, assign this Agreement, any
of the Loan Documents or any interest in the Loan. Any attempted assignment
shall be void and shall constitute an Event of Default under the Loan
Documents.


 


7.15         Senior Debt Cap. Except as
permitted by the Subordination Agreement, the amount of principal debt that is
senior to the Loan, including the Senior Indebtedness, shall not exceed the
Senior Debt Cap.


 


7.16         No Additional Subordinated
Debt. Borrower shall not allow or permit any additional indebtedness to be
subordinated or junior to the Senior Indebtedness (other than the Loan) or
subordinated or junior to the Loan.


 


SECTION 8


FINANCIAL COVENANTS


 


8.1           Special Definitions. In this Section 8,
the following terms shall have the meanings indicated below:


 


(a)           EBITDA. Shall mean,
for any period of determination, Borrower’s net profit before tax plus interest
expense (net of capitalized interest expense), depreciation expense and
amortization expense.


 


8.2           Borrower’s Financial
Covenants. Until the Loan and all indebtedness hereunder have
been paid in full and all Obligations hereunder have been fully discharged,
Borrower covenants and agrees as follows:


 


(a)           Fixed Chare Coverage Ratio. Borrower
shall maintain at all times while any Obligations are outstanding a minimum
Fixed Charge Coverage Ratio of not less than 1.25 to 1. The Fixed Charge
Coverage Ratio shall be calculated utilizing a ratio wherein (a) the
numerator shall be EBITDA plus operating lease expense minus (i) maintenance
capital expenditures of Three Hundred Thousand Dollars and No/100 ($300,000.00)
during each fiscal year period, (ii) income taxes paid or payable, and (iii) dividends
and distributions, and (b) the


 


30

















 


denominator
shall be (i) interest paid or payable, plus (ii) operating
lease expense, plus (iii) scheduled amortization of long-term debt
(all as calculated in accordance with GAAP). The Fixed Charge Coverage Ratio
shall be measured on a rolling four (4) quarter basis.


 


(b)             Total Funded
Debt Ratio. Borrower shall maintain at all times while any
Obligations are outstanding a ratio of total funded debt (excluding the Loan)
to EBITDA (the “Total Funded Debt Ratio”), measured as of the last day of
each fiscal quarter of Borrower using EBITDA for the four (4) quarters
then ended, of not more than the ratios set forth below for the Loan Quarter
indicated:


 




	
  June 30,
  2008

  	
   

  	
  4.00
  to 1

  
	
  September 30,
  2008

  	
   

  	
  3.50
  to 1

  
	
  Thereafter

  	
   

  	
  3.50
  to 1

  






 


(c)             Minimum Net
Worth. Borrower shall maintain at all times while any Obligations are
outstanding a Net Worth not less than the sum of (i) Six Million Dollars
and No/100 ($6,000,000.00) plus (ii) fifty percent (50%) of
Borrower’s Cumulative Quarterly Net Income earned from and after the date of
this Agreement (with no deduction for any quarterly net loss). Borrower’s
minimum Net Worth shall be measured as of the last day of each Loan Quarter and
calculated in accordance with GAAP.


 


8.3           Financial Statements and
Other Reports. Borrower shall cause the following to be delivered
to Lender:


 


(a)             Annual Reports. Within
one-hundred twenty (120) days after the end of each fiscal year of Borrower, an
annual audited balance sheet (together with related audited statements of
income or operations, cash flow and shareholders’ equity) of Borrower, prepared
on a consolidated basis, showing the financial condition of Borrower as of the
close of such fiscal year and the results of its operations during such year,
setting forth in each case in comparative form the figures for the previous
fiscal year, all the foregoing financial statements to be audited by independent
accountants reasonably acceptable to Lender. The first annual financial
statements delivered in connection with this Section 8.3(a) shall
be accompanied by a reconciliation statement showing adjustments with respect
to the financial statements delivered in connection with Section 4.5(a) if
such financial statements are materially different.


 


(b)             Quarterly
Reports. Within forty-five (45) days after the end of each Loan Quarter, an
internally prepared balance sheet and related statements of income or
operations, cash flow and shareholders’ equity, showing the financial condition
and results of operations of Borrower as of the end of each such Loan Quarter
and for the then-elapsed portion of the fiscal year, prepared in accordance
with GAAP consistently applied, all certified by the chief financial officer of
Borrower as being complete and correct in all material respects and fairly
presenting in all material respects, in accordance with GAAP, the financial
position and the results of operations of Borrower, subject to normal year-end
adjustments and absence of footnote disclosure.


 


31

















 


(c)           Compliance
Certificate. As soon as available, and in any event within
forty-five (45) days after the end of each Loan Quarter, a Compliance
Certificate substantially in the form of Exhibit “A” attached
hereto.


 


(d)           Insurance. Annually,
within thirty (30) days after the end of each fiscal year, verification by
Borrower that all insurance required by Lender hereunder remains in force and
effect, in form and detail satisfactory to Lender.


 


(e)           Other
Information. From time to time, with reasonable promptness,
such further information regarding the business, operations, assets, properties
or financial condition of Borrower as Lender may reasonably request.


 


SECTION 9


EVENTS OF DEFAULT; ACCELERATION; REMEDIES


 


The
occurrence of any of the following events or conditions shall constitute an
Event of Default under this Agreement and under each of the other Loan
Documents:


 


9.1           Non-Payment. The
non-payment of any installment of principal, interest or other amount due under
this Agreement, the Note or any other Loan Document when due, or the
non-payment of any amounts due under the Loan on the date the unpaid principal
balance of the Loan and accrued interest becomes due and payable.


 


9.2           Cross-Default. (i) the
occurrence of a default under any Indebtedness of Borrower or its Subsidiaries
in excess of One Hundred Thousand Dollars and No/100 ($100,000.00), the effect
of which default is to cause, or to permit the holder or holders of such
Indebtedness (or a trustee or agent on behalf of such holder or holders) to
cause, with the giving of notice if required, such Indebtedness to be demanded
or to become due or to be repurchased, prepaid, defeased or redeemed
(automatically or otherwise), or an offer to repurchase, prepay, defease or
redeem such Indebtedness to be made, prior to its stated maturity date, or (ii) Borrower
or any Subsidiary fails to make any payment when due (whether by scheduled
maturity, required prepayment, acceleration, demand or otherwise) in respect of
any Indebtedness in excess of One Hundred Thousand Dollars and No/100
($100,000.00).


 


9.3           Financial Condition. Any Loan
Party shall generally not pay its debts as such debts become due, or shall
admit in writing its inability to pay its debts generally, or shall make a
general assignment for the benefit of its creditors; or any proceeding shall be
instituted by any Loan Party seeking to adjudicate it a bankrupt or insolvent,
or seeking liquidation, winding up, reorganization, arrangement, adjustment,
protection, relief composition of it or its debts under any statute, law, rule or
regulation relating to bankruptcy, insolvency or reorganization or relief of
debtors, or seeking the entry of an order for relief or the appointment of a
custodian, receiver, trustee, or other similar official for it or for any
substantial and material part of its property; or any Loan Party shall take any
action to authorize any of the actions set forth above in this Section 9.3.


 


9.4           Involuntary Bankruptcy. The
commencement of a proceeding against any Loan Party seeking to adjudicate it a
bankrupt or insolvent, or seeking liquidation, winding up, reorganization,
arrangement, adjustment, protection, relief or composition of it or its debts
under


 


32

















 


any
statute, law, rule or regulation relating to bankruptcy, insolvency or
reorganization or relief of debtors, or seeking the entry of an order for relief
or the appointment of a custodian, receiver, trustee or other similar official
for it or for any substantial part of its property that is not stayed or
dismissed within sixty (60) days after receipt by such Loan Party of written
notice thereof.


 


9.5           Breach of Warranty. Any
representation or warranty made or deemed made by any Loan Party in this
Agreement or in any other Loan Document or in any certificate delivered to
Lender pursuant to any of the Loan Documents shall have been false or
misleading in any material respect when made or deemed made.


 


9.6           Financial Reporting. Borrower
shall fail to deliver to Lender the financial reports described in Section 8.3
on or before the dates specified for the delivery of such reports.


 


9.7           Covenants. Borrower
shall fail to comply with any of the covenants set forth in this Agreement
(including, without limitation, the covenants set forth in Sections 6, 7 and
8) or in any other Loan Document, and with respect to any such failure that
by its nature can be cured, such failure shall continue for a period of twenty
(20) days after its occurrence; provided, however, that no such cure or
grace period shall apply with respect to the covenants set forth in Sections
9.1, 9.5 or 9.6.


 


9.8           Subordination of Note and
obligations. Except as provided by the Subordination Agreement,
upon Borrower causing this Agreement, the Note or any of the Obligations to be
subordinated or to become junior in anyway to any other debt, liability or
obligation of Borrower.


 


9.9           Default under Amended and
Restated Credit Agreement. Borrower shall fail to pay any installment
of principal, interest or other amount due under the Amended and Restated
Credit Agreement or the Senior Notes when due, or (b) any event of default
shall occur under the Amended and Restated Credit Agreement or any document or
instrument in connection therewith or related thereto, including, without
limitation, the Senior Notes (after giving effect to any applicable grace
periods).


 


9.10         Material Adverse Effect. The
occurrence of any event that has had or could reasonably be expected to have a
Material Adverse Effect.


 


9.11         Security Interests. Any Lien
intended to be created by any Loan Document shall at anytime be invalidated,
subordinated (except as expressly otherwise provided by this Agreement or the
Subordination Agreement) or otherwise cease to be in full force and effect, for
whatever reason, or any security interest purported to be created by any Loan
Document shall cease to be, or shall be asserted by any Loan Party not to be, a
valid, first priority (except as expressly otherwise provided by this Agreement
or the Subordination Agreement) perfected Lien in the Collateral covered
thereby.


 


9.12         Change of Control. There occurs
a Change of Control unless Lender consents in writing in advance thereto.


 


9.13         Judgments. There is
entered against any Loan Party or any Subsidiary thereof: (i) a final
judgment or order for the payment of money in an aggregate amount exceeding One


 


33

















 


Hundred
Thousand Dollars and No/100 ($100,000.00) (to the extent not covered by
independent third party insurance as to which the insurer has agreed to
coverage in writing); or (ii) any one or more non-monetary final judgments
that have, or could reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect and, in either case: (A) enforcement
proceedings are commenced by any creditor upon such judgment or order; or (B) there
is a period of thirty (30) consecutive days during which a stay of enforcement
of such judgment, by reason of a pending appeal or otherwise, is not in effect.


 


9.14         Seizure, etc. A material
portion of the Collateral is attached, seized, subjected to a writ or distress
warrant, or is levied upon, or comes within the possession of any receiver,
trustee, custodian or assignee for the benefit of creditors and on or before
the 60th day thereafter such assets are not returned to and/or such writ,
distress warrant or levy is not dismissed, stayed or lifted.


 


9.15         Event of Loss. There shall
occur any loss, theft, substantial damage or destruction of any item or items
of Collateral that is not fully insured as required, if any, by this Agreement
or the other Loan Documents (a “Loss”), to the
extent the amount of such Loss is not fully covered by insurance (including any
deductible in connection therewith), together with the amount of all other
Losses not fully covered by insurance (including any deductibles in connection
therewith) occurring in the same fiscal year, exceeds One Hundred Fifty
Thousand Dollars and No/100 ($150,000.00).


 


9.16         Acceleration; Remedies.


 


(a)             If any Event of
Default occurs under Section 9.4, all Obligations of Borrower and
all Indebtedness to Lender hereunder shall automatically become immediately due
and payable without presentment, demand, protest or notice of any kind, all of
which Borrower hereby expressly waives, and without any election or action on
the part of Lender. Upon the occurrence of any other Event of Default, other
than an Event of Default under Section 9.4, all Obligations of
Borrower and all Indebtedness to Lender hereunder may be accelerated by Lender
in its sole and absolute discretion, and upon any such acceleration, all
Obligations of Borrower and all Indebtedness to Lender shall automatically
become immediately due and payable without presentment, demand, protest or
notice of any kind, all of which Borrower hereby expressly waives.


 


(b)             Subject to the
terms and conditions of the Subordination Agreement, without limiting the
remedies set forth in this Agreement, if any Event of Default occurs, Lender
may (i) exercise and enforce any and all rights and remedies available
upon default to a secured party under the UCC, including the right to take
possession of the Collateral, or any evidence thereof, proceeding without
judicial process or by judicial process (without a prior hearing or notice
thereof (unless notice is required by the UCC), which Borrower hereby expressly
waives to the extent permitted by applicable law) and the right to sell, lease
or otherwise dispose of any or all of the Collateral (with or without giving
any warranties as to the Collateral (or any portion thereof), title to the
Collateral or similar warranties), and, in connection therewith, Borrower will
upon demand by Lender assemble the Collateral and make it available to Lender
at a place to be designated by Lender that is reasonably convenient to Lender; (ii) exercise
and enforce Lender’s


 


34

















 


rights
and remedies under the Loan Documents; and (iii) exercise any other rights
and remedies available to Lender by federal or state law or at equity or by
agreement.


 


SECTION 10 


OTHER TERMS AND CONDITIONS


 


10.1         Legal Representation. Lender shall
have the right to commence or to appear in or to defend any actions or
proceedings affecting or purporting to affect the rights or duties of Lender
under the Loan Documents. Borrower shall promptly pay all costs and expenses
including, without limitation, reasonable attorneys’ fees, costs and expenses
incurred by Lender in exercising its rights under this Section 10.1
subject to the limitations set forth in Section 10.5.


 


10.2         Governing Law; Submission to
Jurisdiction. This Agreement, the Note and any and all other
Loan Documents shall be governed by and construed in accordance with the law of
the State of Utah. Lender and Borrower hereby consent to the exercise of
jurisdiction over it by any federal court sitting in Utah or any Utah District
Court in the Salt Lake City, Salt Lake City County, Utah, selected by Lender,
for the purposes of any and all legal proceedings arising out of or relating to
the Loan, this Agreement and all other Loan Documents. Each of Lender and
Borrower irrevocably waives, to the fullest extent permitted by applicable law,
any objection that it may now or hereafter have to the laying of venue of any
such proceeding brought in any such court, any claim based on the consolidation
of proceedings in such courts in which proper venue may lie in divergent
jurisdictions, and any claim that any such proceeding brought in any such court
has been brought in an inconvenient forum.


 


10.3         Lender’s Rights Optional;
Marshaling; Payments; Set Aside. Wherever in the Loan
Documents Lender is authorized or given the right to take any action, Lender
may exercise or refrain from exercising such right at its sole option and shall
not be obligated to exercise such right. Lender shall not be liable for any
failure to exercise any such right or for any delay in exercising any such
right. Lender shall be under no obligation to marshal any assets in favor of
Borrower or any other Person or against or in payment of any or all of the
Obligations. To the extent that Borrower makes a payment or payments to Lender
or Lender enforces its Liens or exercises its rights of set-off, and such
payment or payments or the proceeds of such enforcement or set-off or any part
thereof are subsequently invalidated, declared to be fraudulent or
preferential, set aside and/or required to be repaid to a trustee, receiver or
any other Person under any bankruptcy statute, law, rule or regulation,
state or federal law, common law or equitable cause, then, to the extent of
such recovery, the obligation or part thereof originally intended to be
satisfied shall be revived and continued in full force and effect as if such
payment had not been made or such enforcement or set-off had not occurred.


 


10.4         Modification, Waiver,
Consent and Failure to Exercise. No modification or waiver
of any provision of this Agreement or any other Loan Document, and no consent
to any departure by Borrower therefrom, shall be effective or binding upon
Lender or Borrower unless the same is made in writing and signed by Lender and
Borrower. Any such modification, waiver or consent made in writing by Lender
shall be effective only in the specific instance and for the specific purpose
given, and no such waiver, modification or consent shall be a waiver,
modification or consent for any other purpose, or for the same purpose in any
other instance. No notice to or demand on Borrower not specifically required of
Lender under any Loan Document


 


35

















 


shall
entitle Borrower to any other or further notice or demand in the same, similar
or other circumstances. No failure by Lender to exercise any right or remedy
under any circumstance shall impair the right of Lender to the exercise of such
right or remedy or any other right or remedy in that circumstance or in any
other circumstance. Neither the making by Lender of the Loan under this
Agreement nor any other continued performance by Lender hereunder shall
constitute a waiver of (a) any of the conditions to Lender’s obligations
to continue its performance, (b) any right of Lender to suspend its
performance, or (c) any right or remedy available to Lender. If Borrower
is unable to satisfy any such condition, no waiver of such condition shall have
the effect of precluding Lender from thereafter declaring a subsequent similar
inability to be a Default or an Event of Default, as the case may be.


 


10.5         Indemnification. Borrower
shall indemnify and hold Lender and each of its Affiliates, officers,
directors, employees, attorneys, consultants and agents (collectively, the “Indemnitees”)
harmless from and against all claims, costs, expenses, actions, suits,
proceedings, losses, damages and liabilities of any kind whatsoever, including,
but not limited to, reasonable attorneys’ fees, costs and expenses, arising out
of any matter relating, directly or indirectly, (i) to the Loan (including
the use of the proceeds thereof), (ii) to the ownership or sale of the
Collateral, or (iii) any transactions arising out of or contemplated by
the Loan Documents, whether resulting from internal disputes of Borrower,
disputes between Borrower and/or any Affiliate, or whether involving other
third persons or entities, or out of any other matter whatsoever related to
this Agreement, any of the other Loan Documents, or any property encumbered
thereby, but excluding any claim or liability, as to an Indemnitee, that has
been determined by a court of competent jurisdiction (in a final non-appealable
judgment) to have resulted directly from the gross negligence or willful
misconduct of such Indemnitee. This indemnity provision shall continue in full
force and effect and shall survive not only the making of the Loan, but also
shall survive the repayment of the Loan and the performance of all of Borrower’s
other obligations hereunder.


 


10.6         Notices. Any notice,
request, demand, consent, approval, bill, invoice or other communication
required or permitted under the Loan Documents (each, a “notice”) shall
be in writing and will be deemed given (a) upon personal delivery or upon
confirmed transmission by telecopier and similar facsimile transmission device,
(b) on the first Business Day after receipted delivery to a courier
service that guarantees next-business-day delivery, or (c) on the day of
actual receipt after mailing by United States first class mail, registered or
certified, postage prepaid, addressed to the party for whom it is intended at
the following addresses:


 


· If to Borrower, to:


 


Consonus
Acquisition Corp.


Attention:
Robert Muir


2282
South Presidents Drive, Suite B 


West
Valley City, Utah 84120


Fax:
(801) 931-6048


 


36

















 


with
copies to:


 


Knox
Lawrence International, LLC 


Attention:
Nana Baffour


445
Park Avenue, 20th Floor


New
York, New York 10022 


Fax:
(212) 202 4168


 


Stacey
Orr Gallant, Esq. 


Greenberg
Traurig, LLP 


3290
Northside Parkway, Suite 400


Atlanta,
Georgia 30327 


Fax:
(678) 553-2461


 


· If to Lender, to:


 


Proficio
Bank


Attention:
Terry L. Grant


420
East South Temple, Suite 520 


Salt
Lake City, Utah 84111


Fax:
(801) 363-0669


 


with
a copy to:


 


Thomas
R. Taylor, Esq.


Holme
Roberts & Owen LLP


299
South Main Street, Suite 1800


Salt
Lake City, Utah 84111-2263 


Fax:
(801) 521-9639


 


Any
person or entity may change its address or the person designated to receive any
notice by giving ten (10) days’ prior written notice of such change to the
other parties in the manner above prescribed.


 


10.7         Non-Business Day;
Computation of Time. If any action under the Loan Documents is to occur
on a holiday or other day that is not a Business Day, then such action shall
occur on the next Business Day. In computing any period of time under the Loan
Documents by days, the date of the act, event or default from which the
designated period of time begins to run shall not be included but the last day
of the period so computed shall be included. If the last day of the period is
not a Business Day, the period shall run until the end of the next day that is
a Business Day.


 


10.8         Time of Essence. Time is of
the essence of each and every provision of the Loan Documents.


 


37














 


10.9         Recitals, Exhibits and
Schedules. The above Recitals and all Exhibits and Schedules
attached hereto are deemed to be incorporated herein by reference and made a
part hereof.


 


10.10       Severability; Titles. This
Agreement is intended as the complete integration of understandings between the
parties with respect to the matters described in this Agreement, the Loan
Documents and documents and instruments described in this Agreement and
contains material terms bargained-for by the parties. If any provision of this
Agreement or of any other Loan Document securing or executed in connection with
this Agreement is, for any reason and to any extent, invalid or unenforceable,
then neither the remainder of the Loan Document in which such provision is
contained, or the application of the provision to other Persons or
circumstances, nor any other document or instrument referred to in this
Agreement, shall be affected by such invalidity or unenforceability, and there
shall be deemed substituted for the invalid unenforceable provision the most
similar provision that would be valid and enforceable under applicable law. The
headings and titles of the Sections of this Agreement are for reference
purposes only and do not constitute a part of this Agreement. Reference in this
Agreement to any Section or subsection shall be to the stated Section or
subsection of this Agreement, unless otherwise indicated,


 


10.11       Counterparts. This
Agreement may be executed in any number of counterparts, each of which shall be
an original but all of which together shall constitute one and the same
instrument.


 


10.12       Entire Agreement. This
Agreement and the other Loan Documents contain the entire agreement between
Lender and Borrower with respect to the Loan and supersede and cancel any prior
understandings and agreements between Lender and Borrower with respect to the
Loan, except as otherwise specifically set forth herein. This Agreement may be
modified only by a writing executed by Lender and Borrower.


 


10.13       Binding Effect;
Participation. Subject to Section 7.13, this
Agreement shall be binding upon and shall inure to the benefit of Lender and
Borrower and their respective successors and/or permitted assigns; provided,
however, that Lender shall be permitted to assign its rights and
obligations hereunder and under any other Loan Document to any third party
(including, without limitation, any Affiliate of Lender). Without limiting the
foregoing, Lender shall have the right, without the consent of Borrower, to
sell participations to one or more other lenders (a “Participant”)
in or to all or a portion of its rights and obligations under the Loan and the
Loan Documents; provided further, however, that (i) Lender’s
obligations under this Agreement shall remain unchanged, (ii) Lender shall
remain solely responsible to Borrower for the performance of such obligations,
and (iii) Borrower shall continue to deal solely and directly with Lender
in connection with Lender’s rights and obligations under this Agreement and
with regard to any and all payments to be made under this Agreement. In
addition, Lender may at anytime pledge or assign a security interest in all or
any portion of its rights under this Agreement or the other Loan Documents to
secure obligations of Lender.


 


10.14       Information. Borrower
acknowledges and agrees that Lender may provide to any such assignee or
Participant originals or copies of this Agreement, any other Loan Document and
any other documents, instruments, certificates, opinions, insurance policies,
letters of credit,


 


38

















 


reports,
requisitions, and other materials and information of every nature or
description, and may communicate all oral information, at anytime submitted by
or on behalf of Borrower or received by Lender in connection with the Loan or
with respect to Borrower, provided that prior to any such delivery or
communication, such assignees or Participants shall agree to preserve the
confidentiality of any of the foregoing to the same extent that Lender agreed
to preserve such confidentiality. In order to facilitate sales to assignees or
Participants, Borrower shall execute such further documents, instruments or
agreements as Lender may reasonably require; provided, however, that
Borrower shall not be required (i) to execute any document, instrument or
agreement that would materially decrease its rights, or materially increase its
obligations, relative to those set forth in this Agreement or in any other Loan
Document (including financial obligations, representations and warranties, and
reporting requirements), or (ii) to expend more than incidental sums of
money or incidental administrative time for which it does not receive
reasonable reimbursement in order to comply with any requests or requirements
of Lender in connection with such assignment or sale arrangement. In addition,
Borrower agrees to cooperate fully with Lender in the exercise of Lenders’
rights pursuant to this Section 10.14 including providing such
information and documentation regarding Borrower as any potential Participant
may reasonably request and to meet with potential Participants.


 


10.15       Waiver of Jury Trial. Borrower and
Lender, each for itself, hereby irrevocably waive, to the fullest extent
permitted by applicable law, any and all right to trial by jury in any legal
proceeding arising out of or relating to this Agreement, the other Loan
Documents or the transactions contemplated thereby.


 


10.16       ARBITRATION
DISCLOSURES.


 


Any
claim or controversy (a “Dispute”) between or among the
parties and their employees, agents, affiliates, and assigns, including, but
not limited to, Disputes arising out of or relating to this Agreement, this
arbitration provision (this “arbitration clause”), or any
other Loan Document, instrument or agreement relating hereto or delivered in
connection herewith and including, but not limited to, a Dispute based on or
arising from an alleged tort, shall at the request of either party be resolved
by binding arbitration in accordance with the applicable arbitration rules of
the American Arbitration Association (the “Administrator”).
The provisions of this arbitration clause shall survive any termination,
amendment or expiration of this Agreement or any other Loan Document. The
provisions of this arbitration clause shall supersede any prior arbitration
agreement between or among the parties.


 


The
arbitration proceedings shall be conducted in Salt Lake City, Salt Lake County,
Utah. The Administrator and the arbitrator(s) shall have the authority to
the extent practicable to take any action to require the arbitration proceeding
to be completed and the arbitrator(s)’ award issued within one hundred-fifty
(150) days of the filing of the Dispute with the Administrator. The arbitrator(s) shall
have the authority to impose sanctions on any party that fails to comply with
time periods imposed by the Administrator or the arbitrator(s), including the
sanction of summarily dismissing any Dispute or defense with prejudice. The
arbitrator(s) shall have the authority to resolve any Dispute regarding
the terms of this Agreement, this arbitration clause or any of the other Loan
Documents, including any claim or controversy regarding the arbitrability of
any Dispute. All limitations periods applicable to any Dispute or defense,
whether by statute or agreement, shall apply to any arbitration proceeding


 


39

















 


hereunder
and the arbitrator(s) shall have the authority to decide whether any
Dispute or defense is barred by a limitations period and, if so, to summarily
enter an award dismissing any Dispute or defense on that basis. The doctrines
of compulsory counterclaim, res
judicata, and collateral estoppel shall apply to any
arbitration proceeding hereunder so that a party must state as a counterclaim
in the arbitration proceeding any claim or controversy that arises out of the
transaction or occurrence that is the subject matter of the Dispute. The
arbitrator(s) may in the arbitrator(s)’ discretion and at the request of
either party: (a) consolidate in a single arbitration proceeding any other
claim arising out of the same transaction involving another party to that
transaction that is bound by an arbitration clause with Lender, such as
borrowers, guarantors, sureties and owners of collateral; and (b) consolidate
or administer multiple arbitration claims or controversies as a class action in
accordance with Rule 23 of the Federal Rules of Civil Procedure.


 


The
arbitrator(s) shall be selected in accordance with the rules of the
Administrator from panels maintained by the Administrator. A single arbitrator
shall have expertise in the subject matter of the Dispute. Where three
arbitrators conduct an arbitration proceeding, the Dispute shall be decided by
a majority vote of the three arbitrators, at least one of whom must have expertise
in the subject matter of the Dispute and at least one of whom must be a
practicing attorney licensed in the State of Utah. The arbitrator(s) shall
award to the prevailing party all costs, fees and expenses (including
reasonable attorneys’ fees, costs and expenses, arbitration administration fees
and costs, and arbitrator(s)’ fees). The arbitrator(s), either during the
pendency of the arbitration proceeding or as part of the arbitration award,
also may grant provisional or ancillary remedies, including, but not limited
to, an award of injunctive relief, foreclosure, sequestration, attachment,
replevin, garnishment or the appointment of a receiver.


 


Judgment
upon an arbitration award may be entered in any court having jurisdiction,
subject to the following limitation: the arbitration award is binding upon the
parties only if the amount does not exceed Three Million Dollars and No/100
($3,000,000.00); if the award exceeds that limit, either party may demand the
right to a court trial. Such a demand must be filed with the Administrator
within thirty (30) days following the date of the arbitration award; if such a
demand is not made within that time period, the amount of the arbitration award
shall be binding. The computation of the total amount of an arbitration award
shall include amounts awarded for attorneys’ fees, costs and expenses,
arbitration administration fees and costs, and arbitrator(s’) fees.


 


No
provision of this arbitration clause, nor the exercise of any rights hereunder,
shall limit the right of any party to: (a) judicially or non-judicially
foreclose against any real or personal property collateral or other security; (b) exercise
self-help remedies, including, but not limited to, repossession and setoff
rights; or (c) obtain from a court having competent jurisdiction thereover
any provisional or ancillary remedies including but not limited to injunctive
relief, foreclosure, sequestration, attachment, replevin, garnishment or the
appointment of a receiver. Such rights can be exercised at anytime, before or
after initiation of an arbitration proceeding, except to the extent such action
is contrary to the arbitration award. The exercise of such rights shall not
constitute a waiver of the right to submit any Dispute to arbitration, and any
claim or controversy related to the exercise of such rights shall be a Dispute
to be resolved under the provisions of this arbitration clause. Either party
may initiate arbitration


 


40

















 


with
the Administrator. If either party desires to arbitrate a Dispute asserted
against such party in a complaint, counterclaim, cross-claim or third-party
complaint thereto, or in an answer or other reply to any such pleading, such
party must make an appropriate motion to the trial court seeking to compel
arbitration, which motion must be filed with the court within forty-five (45)
days of service of the pleading, or amendment thereto, setting forth such
Dispute. If arbitration is compelled after commencement of litigation of a Dispute,
the party obtaining an order compelling arbitration shall commence arbitration
and pay the Administrator’s filing fees and costs within forty-five (45) days
of entry of such order. Failure to do so shall constitute an agreement to
proceed with litigation and waiver of the right to arbitrate.


 


Notwithstanding
the applicability of any other law to this Agreement, this arbitration clause,
the arbitration proceeding or any other Loan Document between or among the
parties, the Federal Arbitration Act, 9 U.S.C. Section 1 et
seq., shall apply to the construction and interpretation of this arbitration
clause. If any provision of this arbitration clause should be determined to be
unenforceable, all other provisions of this arbitration clause shall remain in
full force and effect.


 


Borrower
acknowledges and agrees as follows:


 


(a)             ARBITRATION IS
FINAL AND BINDING ON THE PARTIES AND SUBJECT TO ONLY VERY LIMITED REVIEW BY A
COURT.


 


(b)             IN ARBITRATION
THE PARTIES ARE WAIVING THEIR RIGHT TO LITIGATE IN COURT INCLUDING THEIR RIGHT
TO A JURY TRIAL.


 


(c)             DISCOVERY IN
ARBITRATION IS MORE LIMITED THAN DISCOVERY IN COURT.


 


(d)             ARBITRATORS ARE
NOT REQUIRED TO INCLUDE FACTUAL FINDINGS OR LEGAL REASONING IN THEIR AWARDS.
THE RIGHT TO APPEAL OR SEEK MODIFICATION OF ARBITRATORS’ RULINGS IS VERY
LIMITED.


 


(e)             A PANEL OF
ARBITRATORS MIGHT INCLUDE AN ARBITRATOR WHO IS OR WAS AFFILIATED WITH THE
BANKING INDUSTRY.


 


(f)              ARBITRATION
WILL APPLY TO ALL DISPUTES BETWEEN THE PARTIES NOT JUST THOSE CONCERNING THE
AGREEMENT.


 


10.17       Construction. The parties
have participated jointly in the negotiation and drafting of this Agreement. In
the event of an ambiguity or if a question of intent or interpretation arises,
this Agreement shall be constructed as if drafted jointly by the parties hereto
and no presumption or burden of proof shall arise favoring or disfavoring
either party by virtue of the authorship of any of the provisions of this
Agreement.


 


10.18       Post-Closing Deliveries. In addition
to the covenants set forth in Section 6, Borrower hereby covenants
to deliver each of the following to Lender within the time periods set forth
below:


 


41

















 


(a)           Audited
Financial Statements. Audited financial statements for Borrower for the
fiscal year ended December 31, 2007, which shall be delivered to Lender
within ninety (90) days after the Closing.


 


(b)           Tax Returns. Complete
copies of Borrower’s 2007 state and federal income tax returns, which shall be
delivered to Lender no later than October 15, 2008.


 


(c)           Tax Good
Standing Certificate. A certificate of tax good standing from the Utah
Department of Revenue, which shall be delivered to Lender no later than ten (10) days
after the delivery of the tax returns referenced in subsection (b) above.


 


[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]


 


42

















 


IN
WITNESS WHEREOF, Borrower and Lender have executed this Loan Agreement
effective as of the day and year first above written.


 


	
   

  	
  BORROWER:

  
	
   

  	
   

  
	
   

  	
  CONSONUS
  ACQUISITION CORP.,

  a Delaware corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Nana Baffour

  
	
   

  	
  Name:

  	
  Nana
  Baffour

  
	
   

  	
  Title:

  	
  Chairman

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  LENDER:

  
	
   

  	
   

  
	
   

  	
  PROFICIO
  BANK, 

  a
  Utah corporation

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Terry L. Grant

  
	
   

  	
  Name:
  

  	
  Terry
  L. Grant

  
	
   

  	
  Title:
  

  	
  Chief
  Credit and Lending Officer

  



 














 


EXHIBIT “A”


 


FORM OF COMPLIANCE CERTIFICATE


 


As of the Loan Quarter ending                                                             ,
20       .


 


This
Compliance Certificate is submitted to Proficio Bank (“Lender”) in connection with the Loan Agreement dated
as of May 21, 2008 (the “Agreement”), entered into by and between Lender and
Consonus Acquisition Corp., a Delaware corporation (“Borrower”). Capitalized terms used in this Compliance
Certificate and not otherwise defined herein shall have the meanings ascribed
thereto in the Agreement.


 


The
undersigned hereby certifies to Lender that he or she is familiar with the
following financial information, which has been taken from Borrower’s books and
records, which are complete and accurate in all material respects, and that the
following calculations are true and correct:


 


	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  In
  Compliance

  	
   

  
	
  Financial Covenant

  	
   

  	
  Required

  	
   

  	
  Actual

  	
   

  	
  (Yes/No)

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Fixed
  Charge Coverage Ratio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Total
  Funded Debt Ratio

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Minimum
  Net Worth

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


The
undersigned further certifies that (a) Borrower is in compliance with all
of the covenants contained in the Agreement, and (b) no Default or Event
of Default has occurred and is continuing under the Agreement.


 


The undersigned has executed this Certificate in his official capacity
and not individually this      day of                      ,
20          .


 


 


	
   

  	
  By:

  	
   

  
	
   

  	
  Name:

  	
   

  
	
   

  	
  Title:

  	
   

  
					



 

















 


EXHIBIT “B”


 


FORM OF NOTE


 

















 


SCHEDULE 1.1


 


PERMITTED LIENS


 


None


 

















 


SCHEDULE 5.4


 


SUBSIDIARIES


 


None


 

















 


SCHEDULE 5.23


 


FIXTURES


 


None


 

















 


SCHEDULE 7.1


 


PERMITTED INVESTMENTS


 


None


 

















 


SCHEDULE 7.8


 


INDEBTEDNESS


 


None