RESULT IN THE CREATION OF ANY LIEN, CHARGE OR ENCUMBRANCE UPON THE COLLATERAL
(OTHER THAN THE LIEN CREATED HEREUNDER) PURSUANT TO THE TERMS OF BORROWER'S
CHARTER OR BYLAWS OR OF ANY CREDIT AGREEMENT, LEASE, GUARANTY, OR OTHER
INSTRUMENT TO WHICH THE BORROWER IS A PARTY OR BY WHICH THE BORROWER MAY BE
BOUND OR TO WHICH ITS PROPERTIES MAY BE SUBJECT (V) THERE ARE NO SET-OFFS,
COUNTERCLAIMS OR DEFENSES ON THE PART OF THE BORROWER WITH RESPECT TO ITS
OBLIGATIONS HEREUNDER; (VI) THE EQUIPMENT HAS BEEN DELIVERED TO AND ACCEPTED BY
THE BORROWER AND WILL BE KEPT AT THE BORROWER'S ADDRESS SET FORTH IN EXHIBIT A
HERETO UNLESS SUCH EQUIPMENT IS DISPOSED OF
AS PROVIDED UNDER SECTION 5 HEREOF
OR THE LENDER OTHERWISE CONSENTS (WHICH CONSENT SHALL NOT BE WITHHELD
UNREASONABLY) OR AT THE ADDRESS OF ANOTHER SUBSIDIARY OF GUARANTOR PROVIDED THAT
BORROWER OR GUARANTOR NOTIFIES LENDER OF SUCH OTHER ADDRESS IN ADVANCE; (VII) IT
WILL NOT ASSIGN ITS RIGHTS TO, CONVEY, SELL, LEASE, OR TRANSFER ANY COLLATERAL,
OR CREATE, INCUR, ASSUME OR ALLOW ANY LIEN WITH RESPECT TO THE COLLATERAL, TO
ANY PERSON OTHER THAN THE LENDER, EXCEPT FOR ASSIGNMENTS AND SECURITY INTERESTS
WHICH ARE INFERIOR OR SUBORDINATE TO THE LENDER'S INTEREST AND TO WHICH LENDER
HAS CONSENTED IN WRITING IN ITS SOLE DISCRETION; (VIII) IT WILL EXECUTE SUCH
FINANCING STATEMENTS IN CONNECTION HEREWITH AS THE LENDER MAY REASONABLY
REQUEST; (IX) IT WILL PRESERVE ITS CORPORATE EXISTENCE AND REMAIN QUALIFIED TO
DO BUSINESS IN THE JURISDICTION(S) WHERE THE EQUIPMENT IS OR WILL BE LOCATED;
(X) ITS CHIEF EXECUTIVE OFFICE IS LOCATED AT THE ADDRESS OF THE BORROWER STATED
ABOVE, AND IT WILL PROMPTLY NOTIFY LENDER OF ANY CHANGE IN SUCH ADDRESS; AND
(XI) THERE IS NO PENDING OR THREATENED LITIGATION AGAINST THE BORROWER WHICH
COULD REASONABLY BE EXPECTED TO HAVE A MATERIAL ADVERSE EFFECT ON THE ABILITY OF
THE BORROWER TO PERFORM ITS OBLIGATIONS UNDER THE COLLATERAL DOCUMENTS.
BORROWER, AT ITS OWN EXPENSE SHALL MAINTAIN THE EQUIPMENT IN GOOD REPAIR,
APPEARANCE AND CONDITIONS, OTHER THAN NORMAL WEAR AND TEAR AND SHALL OBTAIN AND
KEEP IN EFFECT THROUGHOUT THE TERM OF THE APPLICABLE NOTE A MAINTENANCE
AGREEMENT WITH THE MANUFACTURER OR OTHER MANUFACTURER APPROVED SERVICE PROVIDER
FOR SUCH EQUIPMENT.
NOTWITHSTANDING THE FOREGOING PROVISIONS, NOTHING CONTAINED
HEREIN SHALL PROHIBIT THE BORROWER, THE GUARANTOR, OR ANY SUBSIDIARY THERETO
FROM ENTERING INTO ANY TRANSACTION PERMITTED BY SECTION 6.6 OF THAT CERTAIN
CREDIT AGREEMENT BY AND AMONG CONSOLIDATED GRAPHICS, INC., AS BORROWER, AND ITS
DOMESTIC SUBSIDIARIES FROM TIME TO TIME A PARTY THERETO AS GUARANTORS, AND
WACHOVIA BANK NATIONAL ASSOCIATION (FORMERLY FIRST UNION NATIONAL BANK), AND
OTHER LENDERS THERETO DATED DECEMBER 11, 2000, AS IT CURRENTLY EXISTS TODAY.
3.
RISK OF LOSS OR, DAMAGE TO OR DESTRUCTION OF THE EQUIPMENT SHALL
BE BORNE BY THE BORROWER AND THE BORROWER SHALL INSURE THE EQUIPMENT AGAINST
SUCH RISKS TO BE BORNE BY IT IN EACH CASE IN AN AMOUNT NOT LESS THAN THE
AGGREGATE AMOUNT OF THE INDEBTEDNESS
2
OUTSTANDING FROM TIME TO TIME WITH