Document:

Unassociated Document

    

      Exhibit
        10.62

      TERM
        NOTE

      

      
        	
                Borrower's
                  Name:

                 

                FabTech,
                  Inc.

              
	 	 	 
	
                Borrower's
                  Address:

                 

                777
                  N.W. Blue Parkway, Suite 350

                Lee’s
                  Summit, Missouri 64086-5709

              	
                Office:

                 

                30361

              	
                Loan
                  Number:

              
	 	
                Maturity
                  Date:

                 

                August
                  29, 2010

              	
                Amount:

                 

                $5,000,000

              

      

      

      
        
          	Lee’s Summit, Missouri 	
                  $5,000,000

                	
                   Dated:
                    August 29,
                    2005

                

        

      

      
FOR
        VALUE RECEIVED,
        on
        August 29, 2010 (the “Maturity Date”), the undersigned ("Borrower") promises to
        pay to the order of Union Bank of California, N.A., a national banking
        association ("Bank"), as indicated below, the principal sum of Five Million
        Dollars ($5,000,000), or so much thereof as is disbursed, together with interest
        on the balance of such principal from time to time outstanding, at the per
        annum
        rate or rates and at the times set forth below. This Term Note (this "Note")
        shall replace that certain Term Note dated July 6, 2004, in the original
        principal amount of Five Million Dollars ($5,000,000), issued by Borrower
        in
        favor of Bank, and is the Note generally referred to in the Covenant Agreement
        (as such term is defined hereinbelow) and is governed by the terms and
        conditions thereof. Initially capitalized terms used herein which are not
        otherwise defined shall have the meanings assigned to such terms in the Covenant
        Agreement.

      

      1. PAYMENTS

      

      PRINCIPAL
        PAYMENTS.
        Borrower
        shall pay principal in equal consecutive monthly installments, each installment
        in the amount of Eighty-Three Thousand Three Hundred Thirty-Three Dollars
        ($83,333), on the third day of each month, commencing on September 3, 2005.
        On
        the Maturity Date, all outstanding principal hereunder shall be due and
        payable.

      

      INTEREST
        PAYMENTS.
        Borrower
        shall pay interest on the outstanding principal amount hereof on the third
        day
        of each month, commencing on September 3, 2005. Should interest not be paid
        when
        due, it shall become part of the principal and bear interest as herein provided.
        All computations of interest under this Note shall be made on the basis of
        a
        year of 360 days, for actual days elapsed.

      

      (a) Base
        Interest Rate.
        At
        Borrower’s option, amounts outstanding hereunder in minimum amounts of at least
        $100,000 shall bear interest at a rate, based on an index selected by Borrower,
        equal to Bank's LIBOR Rate for the Interest Period selected by Borrower plus
        one
        and fifteen one-hundredths percent (1.15%).

      

      
        
           

        

        
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      The
        Base
        Interest Rate may not be changed, altered or otherwise modified until the
        expiration of the Interest Period selected by Borrower. The exercise of interest
        rate options by Borrower shall be as recorded in Bank's records, which records
        shall be prima facie
        evidence
        of the amount borrowed at the Base Interest Rate and the interest rate;
        provided, however, that failure of Bank to make any such notation in its
        records
        shall not discharge Borrower from its obligations to repay in full with interest
        all amounts borrowed. In no event shall any Interest Period extend beyond
        the
        Maturity Date.

      

      To
        exercise this option, Borrower may, from time to time with respect to principal
        outstanding on which a Base Interest Rate is not accruing, and on the expiration
        of any Interest Period with respect to principal outstanding on which a Base
        Interest Rate has been accruing, select an index offered by Bank for a Base
        Interest Rate Loan and an Interest Period by telephoning an authorized lending
        officer of Bank located at the banking office identified below prior to 10:00
        a.m., Pacific time, on any Business Day and advising that officer of the
        selected index, the Interest Period and the Origination Date selected (which
        Origination Date, for a Base Interest Rate Loan based on the LIBOR Rate,
        shall
        follow the date of such selection by no more than two (2) Business
        Days).

      

      Bank
        will
        mail a written confirmation of the terms of the selection to Borrower promptly
        after the selection is made. Failure to send such confirmation shall not
        affect
        Bank's rights to collect interest at the rate selected. If, on the date of
        the
        selection, the index selected is unavailable for any reason, the selection
        shall
        be void. Bank reserves the right to fund the principal from any source of
        funds
        notwithstanding any Base Interest Rate selected by Borrower.

      

      (b) Variable
        Interest Rate.
        All
        principal outstanding hereunder which is not bearing interest at a Base Interest
        Rate shall bear interest at a rate per annum equal to the Reference Rate,
        which
        rate shall vary as and when the Reference Rate changes.

      

      Borrower
        shall pay all amounts due under this Note in lawful money of the United States
        at Bank's San Fernando Valley Commercial Banking Office, or such other office
        as
        may be designated by Bank from time to time.

      

      2. LATE
        PAYMENTS.
        If any
        payment required by the terms of this Note shall remain unpaid ten days after
        same is due, at the option of Bank, Borrower shall pay a fee of $100 to
        Bank.

      

      3. INTEREST
        RATE FOLLOWING DEFAULT.
        In the
        event of default, at the option of Bank, and, to the extent permitted by
        law,
        interest shall be payable on the outstanding principal under this Note at
        a per
        annum rate equal to five percent (5%) in excess of the interest rate specified
        in paragraph 1.b above, calculated from the date of default until all amounts
        payable under this Note are paid in full.

      

      
        
           

        

        
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      4. PREPAYMENT

      

      (a) Amounts
        outstanding under this Note bearing interest at a rate based on the Reference
        Rate may be prepaid in whole or in part at any time, without penalty or premium.
        Borrower may prepay amounts outstanding under this Note bearing interest
        at a
        Base Interest Rate in whole or in part provided Borrower has given Bank not
        less
        than five (5) Business Days’ prior written notice of Borrower’s intention to
        make such prepayment and pays to Bank the prepayment fee due as a result.
        The
        prepayment fee shall also be paid, if Bank, for any other reason, including
        acceleration or foreclosure, receives all or any portion of principal bearing
        interest at a Base Interest Rate prior to its scheduled payment date. The
        prepayment fee shall be an amount equal to the present value of the product
        of:
        (i) the difference (but not less than zero) between (a) the Base Interest
        Rate
        applicable to the principal amount which is being prepaid, and (b) the return
        which Bank could obtain if it used the amount of such prepayment of principal
        to
        purchase at bid price regularly quoted securities issued by the United States
        having a maturity date most closely coinciding with the relevant Base Rate
        Maturity Date and such securities were held by Bank until the relevant Base
        Rate
        Maturity Date ("Yield Rate"); (ii) a fraction, the numerator of which is
        the
        number of days in the period between the date of prepayment and the relevant
        Base Rate Maturity Date and the denominator of which is 360; and (iii) the
        amount of the principal so prepaid (except in the event that principal payments
        are required and have been made as scheduled under the terms of the Base
        Interest Rate Loan being prepaid, then an amount equal to the lesser of (A)
        the
        amount prepaid or (B) 50% of the sum of (1) the amount prepaid and (2) the
        amount of principal scheduled under the terms of the Base Interest Rate Loan
        being prepaid to be outstanding at the relevant Base Rate Maturity Date).
        Present value under this Note is determined by discounting the above product
        to
        present value using the Yield Rate as the annual discount factor.

      

      (b) In
        no
        event shall Bank be obligated to make any payment or refund to Borrower,
        nor
        shall Borrower be entitled to any setoff or other claim against Bank, should
        the
        return which Bank could obtain under this prepayment formula exceed the interest
        that Bank would have received if no prepayment had occurred. All prepayments
        shall include payment of accrued interest on the principal amount so prepaid
        and
        shall be applied to payment of interest before application to principal.
        A
        determination by Bank as to the prepayment fee amount, if any, shall be
        conclusive.

      

      (c) Bank
        shall provide Borrower a statement of the amount payable on account of
        prepayment. Borrower acknowledges that (i) Bank establishes a Base Interest
        Rate
        upon the understanding that it apply to the Base Interest Rate Loan for the
        entire Interest Period, and (ii) Bank would not lend to Borrower without
        Borrower’s express agreement to pay Bank the prepayment fee described
        above.

      

      Initial
        Here: /s/ MP

      

      
        
           

        

        
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      5. DEFAULT
        AND ACCELERATION OF TIME FOR PAYMENT.
        Default
        shall include, but not be limited to, any of the following: (a) the failure
        of
        Borrower to make any payment required under this Note when due; (b) any breach,
        misrepresentation or other default by Borrower, any guarantor, co-maker,
        endorser, or any person or entity other than Borrower providing security
        for
        this Note (hereinafter individually and collectively referred to as the
        "Obligor") under any security agreement, guaranty or other agreement between
        Bank and any Obligor; (c) the insolvency of any Obligor or the failure of
        any
        Obligor generally to pay such Obligor's debts as such debts become due; (d)
        the
        commencement as to any Obligor of any voluntary or involuntary proceeding
        under
        any laws relating to bankruptcy, insolvency, reorganization, arrangement,
        debt
        adjustment or debtor relief; (e) the assignment by any Obligor for the benefit
        of such Obligor's creditors of any substantial part of such Obligor’s property;
        (f) the appointment, or commencement of any proceeding for the appointment
        of a
        receiver, trustee, custodian or similar official for all or substantially
        all of
        any Obligor's property; (g) the commencement of any proceeding for the
        dissolution or liquidation of any Obligor; (h) the termination of existence
        or
        death of any Obligor; (i) the revocation of any guaranty or subordination
        agreement given in connection with this Note; (j) the failure of any Obligor
        to
        comply with any order, judgment, injunction, decree, writ or demand of any
        court
        or other public authority; (k) the filing or recording against any Obligor,
        or
        the property of any Obligor, of any notice of levy, notice to withhold, or
        other
        legal process for taxes other than property taxes; (l) the default by any
        Obligor personally liable for amounts owed hereunder on any obligation
        concerning the borrowing of money (including, without limitation, the occurrence
        of any Event of Default under and as defined in the Amended and Restated
        Credit
        Agreement); (m) the issuance against any Obligor, or the property of any
        Obligor, of any writ of attachment, execution, or other judicial lien; or
        (n)
        the deterioration of the financial condition of any Obligor which results
        in
        Bank deeming itself, in good faith, insecure. Upon the occurrence of any
        such
        default, Bank, in its discretion, may cease to advance funds hereunder and
        may
        declare all obligations under this Note immediately due and payable; however,
        upon the occurrence of an event of default under subparagraph (c), (d), (e),
        (f)
        or (g) hereof, all principal and interest shall automatically become immediately
        due and payable.

      

      6. ADDITIONAL
        AGREEMENTS OF BORROWER.
        If any
        amounts owing under this Note are not paid when due, Borrower promises to
        pay
        all costs and expenses, including reasonable attorneys' fees, incurred by
        Bank
        in the collection or enforcement of this Note. Borrower and any endorsers
        of
        this Note, for the maximum period of time and the full extent permitted by
        law,
        (a) waive diligence, presentment, demand, notice of nonpayment, protest,
        notice
        of protest, and notice of every kind; (b) waive the right to assert the defense
        of any statute of limitations to any debt or obligation hereunder; and (c)
        consent to renewals and extensions of time for the payment of any amounts
        due
        under this Note. The receipt of any check or other item of payment by Bank,
        at
        its option, shall not be considered a payment on account until such check
        or
        other item of payment is honored when presented for payment at the drawee
        Bank.
        Bank may delay the credit of such payment based upon Bank's schedule of funds
        availability, and interest under this Note shall accrue until the funds are
        deemed collected. In any action brought under or arising out of this Note,
        Borrower and any Obligor, including their successors and assigns, hereby
        consent
        to the jurisdiction of any competent court within the State of California,
        as
        provided in any alternative dispute resolution agreement executed between
        Borrower and Bank, and consent to service of process by any means authorized
        by
        said state’s law. The term "Bank" includes, without limitation, any holder of
        this Note. This Note shall be construed in accordance with and governed by
        the
        laws of the State of California. This Note hereby incorporates any alternative
        dispute resolution agreement previously, concurrently or hereafter executed
        between Borrower and Bank.

      

      
        
           

        

        
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      7. CHANGE
        IN CIRCUMSTANCES

      

      (a) Inability
        to Determine Rates.
        If, on
        or before the first day of any Interest Period for any Base Interest Rate
        Loan,
        Bank determines that the Base Interest Rate for such Interest Period cannot
        be
        adequately and reasonably determined due to the unavailability of funds in
        or
        other circumstances affecting the London interbank market, or the certificate
        of
        deposit market, as the case may be, which determination by Bank shall be
        conclusive and binding upon Borrower, Bank shall immediately give notice
        thereof
        to Borrower. After the giving of any such notice and until Bank shall otherwise
        notify Borrower that the circumstances giving rise to such condition no longer
        exist, Borrower's right to request, and Bank's obligation to offer, a Base
        Interest Rate Loan shall be suspended. Any Base Interest Rate Loan outstanding
        at the commencement of any such suspension which affects Base Interest Rate
        Loans of that type, shall be converted at the end of the then current Interest
        Period for that loan to a Reference Rate Loan unless such suspension has
        then
        ended.

      

      (b) Illegality.
        If,
        after the date of this Note, the adoption of any applicable law, rule or
        regulation, or any change therein, or change in the interpretation or
        administration thereof by any governmental authority, central bank, comparable
        agency or other Person charged with the interpretation or administration
        thereof, or compliance by Bank with any request or directive (whether or
        not
        having the force of law) of any such authority (a "Change of Law") shall
        make it
        unlawful or impossible for Bank to make or maintain a Base Interest Rate
        Loan,
        Bank shall immediately notify Borrower of such Change of Law. After Borrower's
        receipt of such notice, Borrower's right to select, and Bank's obligation
        to
        offer, a Base Interest Rate Loan shall be terminated, and the undersigned
        shall
        (i) at the end of the current Interest Period for any Base Interest Rate
        Loan
        then outstanding, convert such loan to a Reference Rate Loan, or (ii)
        immediately repay or convert any Base Interest Rate Loan then outstanding
        if
        Bank shall notify Borrower that Bank may not lawfully continue to fund and
        maintain such Base Interest Rate Loan.

      

      (c) Increased
        Costs.
        If,
        after the date of this Note, any Change of Law:

      

      
        
           

        

        
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      (i) shall
        subject Bank to any tax, duty or other charge with respect to a Base Interest
        Rate Loan or its obligation to make such Base Interest Rate Loan, or shall
        change the basis of taxation of payments by Borrower to Bank on such Base
        Interest Rate Loan or in respect to such Base Interest Rate Loan under this
        Note
        (except for changes in the rate of taxation on the overall net income of
        Bank);
        or

      

      (ii) shall
        impose, modify or hold applicable any reserve, special deposit or similar
        requirement against assets held by, deposits or other liabilities in or for
        the
        account of, advances or loans by, or any other acquisition of funds by Bank
        for
        any Base Interest Rate Loan (except for any reserve, special deposit or other
        requirement included in the determination of the Base Rate); or

      

      (iii) shall
        impose on Bank any other condition directly related to any Base Interest
        Rate
        Loan; and the effect of any of the foregoing is to increase the cost to Bank
        of
        making, renewing or maintaining a Base Interest Rate Loan beyond any adjustment
        made by Bank in determining the applicable interest rate for any such Base
        Interest Rate Loan, or to reduce the amount receivable by Bank
        hereunder;

      

      then
        Borrower shall from time to time, upon demand by Bank, pay to Bank additional
        amounts sufficient to reimburse Bank for such increased costs or reduced
        amounts. A certificate as to the amount of such increased costs or reduced
        amounts, submitted to the Borrower by Bank, shall, in the absence of manifest
        error, be conclusive and binding on Borrower for all purposes.

      

      (d) Capital
        Adequacy.
        If Bank
        shall determine that:

      

      (i) any
        law,
        rule or regulation, any interpretation or application thereof by any
        governmental authority, central bank, comparable agency or other Person charged
        with the interpretation or administration thereof, any directive, request,
        assessment guideline or other guideline issued by such authority, bank, agency
        or Person (whether or not having the force of law) or any change in any of
        the
        foregoing which is adopted, issued or becomes effective after the date hereof
        affects the amount of capital required or expected to be maintained by Bank
        or
        any Person controlling Bank (a "Capital Adequacy Requirement"); and

      

      (ii) the
        amount of capital maintained by Bank or such Person which is attributable
        to or
        based upon this Note or the amounts outstanding hereunder must be increased
        as a
        result of such Capital Adequacy Requirement (taking into account Bank's or
        such
        Person's policies with respect to capital adequacy), Borrower shall pay to
        Bank
        or such Person, upon demand of Bank, such amounts as Bank or such Person
        shall
        determine are necessary to compensate Bank or such Person for the increased
        costs to Bank or such Person of such increased capital. A certificate of
        Bank,
        setting forth in reasonable detail the computation of any such increased
        costs,
        delivered by Bank to Borrower shall, in the absence of manifest error, be
        conclusive and binding on Borrower for all purposes.

      

      
        
           

        

        
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      8. DEFINITIONS.
        As used
        herein, the following terms shall have the meanings respectively set forth
        below: "Amended
        and Restated Credit Agreement" means
        that certain Amended and Restated Credit Agreement dated as of February 27,
        2003, by and between Diodes and Bank, as amended and as at any time and from
        time to time further amended, supplemented, extended, restated or renewed.
        "Base
        Interest Rate"
        means a
        rate of interest based on the LIBOR Rate. "Base
        Interest Rate Loan"
        means
        amounts outstanding under this Note that bear interest at a Base Interest
        Rate.
"Base
        Rate Maturity Date"
        means
        the last day of the Interest Period with respect to principal outstanding
        under
        a Base Interest Rate Loan. "Business
        Day"
        means a
        day on which Bank is open for business for the funding of corporate loans,
        and,
        with respect to the rate of interest based on the LIBOR Rate, on which dealings
        in U.S. dollar deposits outside of the United States may be carried on by
        Bank.
"Covenant
        Agreement"
        means
        that certain Covenant Agreement dated the date of this Note, by and between
        Borrower and Bank, as an any time and from time to time amended, supplemented,
        extended, restated or renewed. "Diodes"
        means
        Diodes Incorporated, a Delaware corporation and parent company of Borrower.
        "Financial
        Statement"
        has the
        meaning assigned to such term in the Amended and Restated Credit Agreement.
        "Interest
        Period"
        means
        with respect to funds bearing interest at a rate based on the LIBOR Rate,
        any
        calendar period of one (1) month, two (2) months, three (3) months, four
        (4)
        months, five (5) months, six (6) months, nine (9) months or twelve (12) months.
        In determining an Interest Period, a month means a period that starts on
        one
        Business Day in a month and ends on and includes the day preceding the
        numerically corresponding day in the next month. For any month in which there
        is
        no such numerically corresponding day, then as to that month, such day shall
        be
        deemed to be the last calendar day of such month. Any Interest Period which
        would otherwise end on a non-Business Day shall end on the next succeeding
        Business Day unless that is the first day of a month, in which event such
        Interest Period shall end on the next preceding Business Day. "LIBOR
        Rate"
        means a
        per annum rate of interest (rounded upward, if necessary, to the nearest
        1/100
        of 1%) at which dollar deposits, in immediately available funds and in lawful
        money of the United States would be offered to Bank, outside of the United
        States, for a term coinciding with the Interest Period selected by Borrower
        and
        for an amount equal to the amount of principal covered by Borrower's interest
        rate selection, plus Bank’s costs, including the cost, if any, of reserve
        requirements. "Origination
        Date"
        means
        the first day of the Interest Period. "Reference
        Rate"
        means
        the rate announced by Bank from time to time at its corporate headquarters
        as
        its Reference Rate. The Reference Rate is an index rate determined by Bank
        from
        time to time as a means of pricing certain extensions of credit and is neither
        directly tied to any external rate of interest or index nor necessarily the
        lowest rate of interest charged by Bank at any given time.

      
        
           

        

        
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      FABTECH,
        INC.

      

      By:
        /s/
        MaryJo Parsons

      

      Title:
        Secretary

       

       

      
        
           

        

        
          8AGREEMENT FOR ASSIGNMENT OF PROMISSORY NOTE, UCC FINANCING
            STATEMENT AND RELATED COLLATERAL DOCUMENTS AND INTERESTS

      THIS AGREEMENT FOR ASSIGNMENT OF PROMISSORY NOTE. UCC FINANCING  STATEMENT
AND RELATED COLLATERAL DOCUMENTS AND INTERESTS ("Agreement") is made and entered
into this 26th day of August,  2005 by and between U.S. Bank,  N.A. ("the Bank")
and  David  R.  DeYoung  and  Mary  Anne  DeYoung  ("Purchasers").  The Bank and
Purchasers are sometimes hereinafter referred to as ("the Parties").

                                    Recitals

      A. On or about February 24, 2004,  Image Software,  Inc.  ("Borrower") and
the Bank  entered  into a  lending  agreement  (the  "Loan")  evidenced  by that
Revolving Credit Note of said date in the original  principal sum of $200,000.00
(the "Note").

      B. The full  and  faithful  performance  of the  Note is  secured  by that
certain Business Security  Agreement  ("Security  Agreement") dated February 24,
2004  executed and  delivered by Image  Software,  Inc.,  for the benefit of the
Bank. The Business  Security  Agreement  security interest is reflected in a UCC
Financing Statement which Statement was recorded on March 5, 2004 in the records
of the Secretary of State as reception  number  2004F023558  (the "UCC Financing
Statement).

      C. The Note, Security Agreement,  Debt and Security Interest Subordination
Agreement and UCC Financing Statement are hereinafter  collectively  referred to
as the "Agreement Documents."

      D.  WHEREAS,  Purchasers  desire to purchase  from the Bank,  and the Bank
desires to sell to Purchasers, without recourse, all of the Bank's rights, title
and interest, in and to the Agreement Documents on the terms described below.

      NOW, THEREFORE, the parties agree as follows:

      1. Preamble;  Preliminary Recitals.  The preamble and preliminary recitals
set forth above are by this  reference  incorporated  in and made a part of this
Agreement,

      2.  Purchase  of Assets.  Subject  to the  provisions  of this  Agreement,
Purchasers agree to purchase, and The Bank agrees to sell, without recourse, all
of the Bank's rights, title and interest, in and to: (a) the Agreement Documents
as defined above; (b) all indebtedness  under the Agreement  Documents,  and (c)
all  causes of  action  related  to the  Agreement  Documents  (all of which are
hereinafter,  collectively referred to as the "Purchased Assets"). The Purchased
Assets do not include any other assets of the Bank and specifically exclude: (i)
cash;  (ii) any  accounting  related  books  and  records,  whether  written  or
electronically  recorded;  (iii)  causes of action not related to the  Purchased
Assets;  (iv) deposits and (v) any personal  property  interests  subject to any
security interest in favor of a third party.
<PAGE>

      3. Purchase  Price.  The purchase price for the Purchased  Assets shall be
One Hundred  Forty Nine Thousand One Hundred  Thirty Five and 43/100ths  Dollars
($149,135.43)  ("Purchase  Price").  The Purchase Price is payable upon the date
and at the time of Closing.

      4.  Closing.  The  consummation  of the purchase and sale of the Purchased
Assets  (the  "Closing")  shall be held on August  26,  2005 or sooner by mutual
agreement  of the  parties at the Bank's  branch  office  located at Denver Tech
Center Office,  8401 E. Belleview  Avenue,  Denver,  Colorado 80237. At Closing,
Purchasers shall pay to the Bank the Purchase Price, in Good Funds.

      5. Delivery and Condition of the Purchased Assets.

            a.  Immediately  upon the  delivery to the Bank of Good Funds in the
amount of the  Purchase  Price by  Purchasers  at the  Closing,  the Bank  shall
deliver to Purchaser an original Allonge assigning the Note in the form attached
hereto as Exhibit A. Additionally,  after the closing,  the Bank will obtain the
original  Note and deliver the original Note to  Purchasers.  Upon the execution
and delivery of the aforesaid Allonge and original documents,  the Bank shall be
deemed to have fully and  completely  transferred  to Purchasers all its rights,
title and  interest  in,  as well as  possession,  custody  and  control  of the
Purchased  Assets.  The  Bank  shall  not  be  liable  or  responsible  for  any
liabilities  or  obligations  of any kind or nature  whatsoever  arising out of,
under, or related to the Purchased Assets from and after the Closing.

            b.  The  Bank   represents  to   Purchasers,   as  the  Bank's  sole
representation in connection with this Agreement, is as follows:

      The Bank is the holder of the Agreement  Documents and has not transferred
      any interest therein to any other person or entity.

      c.  Purchasers  agree that they are purchasing and shall take  possession,
except as otherwise  provided  herein,  of the Purchased  Assets in their AS IS,
WHERE IS  condition  and  acknowledges  that it has  previously  been  given the
opportunity  to and has conducted  such  investigations  and  inspections of the
Purchased  Assets,  and the transactions  underlying the Purchased Assets, as it
has  deemed  necessary  or  appropriate  for the  purposes  of  this  Agreement.
Purchasers  represent and acknowledge that its decisions to enter into and close
this Agreement  were and are based solely on  Purchasers'  own due diligence and
were not and are not the result of any reliance upon any  representations of the
Bank,  or any  employee  or agent  thereof,  except as are  expressly  set forth
herein.

      d. EXCEPT AS EXPRESSLY  STATED IN THIS  AGREEMENT,  THE BANK DOES NOT MAKE
ANY EXPRESS OR IMPLIED REPRESENTATIONS, STATEMENTS, WARRANTIES, OR CONDITIONS OF
ANY KIND OR NATURE  WHATSOEVER  CONCERNING  THE AGREEMENT  DOCUMENTS,  INCLUDING
(WITHOUT LIMITING THE GENERALITY OF THE FOREGOING) ANY WARRANTIES  REGARDING THE
CONDITION,  QUANTITY  AND/OR  QUALITY  OR VALUE  OF ANY OR ALL OF THE  AGREEMENT
DOCUMENTS AND ANY AND ALL IMPLIED WARRANTIES ARE HEREBY DISCLAIMED. FURTHER, THE
PURCHASERS  EXPRESSLY  ACKNOWLEDGE AND AGREE THAT NO  REPRESENTATIONS  HAVE BEEN
MADE BY THE BANK NOR HAVE PURCHASERS  RELIED UPON ANY INFORMATION OTHER THAN ITS
OWN INVESTIGATION, IF ANY, AS TO THE PRIORITY OF ANY SECURITY INTEREST.

                                       2
<PAGE>

                ANY SALE, TRANSFER OR ASSIGNMENT OF THE AGREEMENT
           DOCUMENTS PURSUANT TO THIS AGREEMENT IS WITHOUT RECOURSE.

      6. Conditions  Precedent to Closing.  The obligation of performance by the
Purchasers  under this Agreement is contingent upon the Purchasers'  approval of
the  Allonge  attached  hereto as  Exhibit A, and such  other due  diligence  as
determined by their sole discretion.  The performance of Bank of its obligations
under this Agreement is further  subject to the condition that the Bank has not,
on or before the Closing  Date,  received a tender of funds from or on behalf of
the parties  obligated under the Agreement  Documents  sufficient to satisfy all
obligations thereunder.

      7. Default by Bank.  If the Bank fails to make the required  deliveries at
the Closing or otherwise  defaults under this Agreement,  then Purchasers  shall
have the right to terminate this Agreement and thereupon this Agreement shall he
null and void and of no legal effect  whatsoever.  If so terminated,  each party
hereto shall suffer their own losses,  costs, expenses or damages rising out of,
under or related to this Agreement.

      8.  Indemnity.  Purchasers  shall  indemnify,  defend  and  hold  the Bank
harmless from and against any and all losses,  liabilities,  damages,  costs and
obligations,  or  actions  or claims in  respect  thereof  including  reasonable
counsel fees which the Bank may suffer or incur arising out of or based upon:

            a. the breach of any representation, warranty, covenant or agreement
of Purchasers contained in this Agreement, and

            b. the Purchasers'  use of any of the Agreement  Documents after the
Closing.

      9. Miscellaneous.  This Agreement may be executed by the parties hereto by
facsimile signature,  any of which shall be deemed an original signature, and in
any number of separate counterparts all of which taken together shall constitute
one and the same instrument.

                                       3
<PAGE>

         IN WITNESS WHEREOF, the Parties hereto have executed and delivered this
Agreement on the date first above written.

U.S. BANK, N.A.

By: /s/Brian Curry
    ------------------------------
    Brian Curry, as Vice President
                                                     /s/David R. DeYoung
                                                     ---------------------------
                                                     David R. DeYoung

                                                     /s/ Mary Anne DeYoung
                                                     ---------------------------
                                                     Mary Anne DeYoung

                                       4
<PAGE>

                                     ALLONGE

       (Attached to and made a part of that certain Revolving Credit Note,
  dated February 24, 2004, in the original principal amount of $200,000.00 from
                   Image Software, Inc. to U. S. Bank, N.A.)

      Pay to the  order of David R.  DeYoung  and  Mary  Anne  DeYoung,  without
recourse or warranty in any event.

      Dated: August 26, 2005

                                             U.S. BANK, N.A.

                                             By:/s/ Brian Curry
                                                -----------------------------
                                                Brian Curry, as Vice President

                                       5
<PAGE>

                                 For Bank Use Only   Reviewed by ______________
                                 Due  FEBRUARY 24, 2005
                                 Customer #  7521406900       Loan # __________

                              REVOLVING CREDIT NOTE

$ 200,000.00                                                   FEBRUARY 24, 2004
------------                                                   -----------------

      FOR VALUE RECEIVED, the undersigned borrower (the "Borrower"), promises to
pay to the order of U.S.  BANK  N.A.  (the  "Bank"),  the  principal  sum of TWO
HUNDRED  THOUSAND AND NO/1 0 Dollars ($ 200,000.00 ) payable  FEBRUARY 24, 2005
(the "Maturity Date").

      Interest.

      The unpaid principal balance will bear interest at an annual rate equal to
      1.750% plus the prime rate announced by the Bank.

      The interest rate hereunder will be adjusted each time that the prime rate
      changes.

      Payment Schedule.

      Interest is payable beginning MARCH 24, 2004, and on the same date of each
      CONSECUTIVE  month thereafter  (except that if a given month does not have
      such a date, the last day of such month),  plus a final  interest  payment
      with the final payment of principal.

      Interest  will be  computed  for the actual  number of days  principal  is
unpaid,  using a daily factor  obtained by dividing the stated  interest rate by
360.

      Notwithstanding  any  provision  of this  Note to the  contrary,  upon any
default or at any time during the continuation thereof (including failure to pay
upon  maturity),  the Bank may,  at its option and  subject to  applicable  law,
increase  the  interest  rate on this  Note to a rate of 5% per  annum  plus the
interest rate otherwise  payable  hereunder.  Notwithstanding  the foregoing and
subject to applicable  law, upon the  occurrence of a default by the Borrower or
any guarantor involving bankruptcy,  insolvency,  receivership proceedings or an
assignment  for the benefit of  creditors,  the interest rate on this Note shall
automatically increase to a rate of 5% per annum plus the rate otherwise payable
hereunder.

      In no event will the  interest  rate  hereunder  exceed that  permitted by
applicable law. If any interest or other charge is finally determined by a court
of competent  jurisdiction  to exceed the maximum  amount  permitted by law, the
interest or charge  shall be reduced to the maximum  permitted  by law,  and the
Bank may credit any excess amount  previously  collected against the balance due
or refund the amount to the Borrower,

      Subject to applicable law, if any payment is not made on or before its due
date, the Bank may collect a delinquency  charge of 0.00 % of the unpaid amount.
Collection  of the late  payment  fee  shall not be deemed to be a waiver of the
Bank's right to declare a default hereunder.

                                       6
<PAGE>

      Without  affecting  the  liability of any  Borrower,  endorser,  surety or
guarantor,  the Bank may, without notice,  renew or extend the time for payment,
accept  partial  payments,  release or impair any  collateral  security  for the
payment of this Note, or agree not to sue any party liable on it.

      This Revolving  Credit Note  constitutes the Note issued under a Revolving
Credit  Agreement dated as of the date hereof between the Borrower and the Bank,
to which  Agreement  reference  is hereby made for a statement  of the terms and
conditions  under  which  loans  evidenced  hereby  were  or may be  made  and a
description of the terms and conditions upon which the maturity of this Note may
be accelerated, and for a description of the collateral securing this Note.

      This Note is a "transferablerecord"  as defined in applicable law relating
to electronic transactions. Therefore, the holder of this Note may, on behalf of
Borrower,  create a microfilm or optical disk or other  electronic image of this
Note that is an  authoritative  copy as defined in such law.  The holder of this
Note may store the  authoritative  copy of such Note in its electronic  form and
then  destroy  the  paper  original  as part  of the  holder's  normal  business
practices.  The  holder,  on its own  behalf,  may  control  and  transfer  such
authoritative copy as permitted by such law.

      All  documents  attached  hereto,  including  any  appendices,  schedules,
riders,  and  exhibits  to this  Revolving  Credit  Note,  are hereby  expressly
incorporated by reference.

The Borrower hereby acknowledges the receipt of a copy of this Note.

(Individual Borrower)                  IMAGE SOFTWARE, INC.
                                       -----------------------------------------
                                       Borrower Name (Organization)

                                       a   COLORADO corporation
                                           -------------------------------------

                                       By: /s/ DAVID R. DEYOUNG
                                           -------------------------------------
Borrower Name     N/A                      David R. DeYoung, President
             --------------
                                       Name and Title   AUTHORIZED SIGNER, TITLE
                                                        ------------------------

                                       By
                                         ---------------------------------------
Borrower Name     N/A                  Name and Title
             --------------                          ---------------------------

                                       7

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