UNITED STATES OF AMERICA
BEFORE THE SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
In the Matter of .
.
Entergy Corporation .
Entergy Enterprises, Inc. .
Entergy Systems and Service, Inc. . SUPPLEMENTAL CERTIFICATE
PURSUANT TO RULE 24
File No. 70-7947 .
.
(Public Utility Holding Company .
Act of 1935) .
Pursuant to Rule 24 promulgated by the Securities
and Exchange Commission (SEC) under the Public Utility
Holding Company Act of 1935, modified by the
application-declaration referenced above and the
related order dated December 28, 1992 (the "1992
Order"), this is to certify that, on April 20, 1995,
Entergy Systems and Service, Inc. ("Entergy SASI")
entered into the following transactions and related
agreements with Systems & Service International, Inc.
("SASI") and/or Systems & Service International
Manufacturing, L.P. (a limited partnership in which
SASI directly and indirectly owns a 100% interest and
to which SASI has transferred substantially all of its
assets and liabilities) (the "Partnership"), as more
particularly set forth below:
a) Entergy SASI, SASI, and the Partnership entered
into a First Amendment (the "Amendment") to the
Exclusive Distribution Agreement, dated December 29,
1992, between Entergy SASI and SASI (the "Agreement"),
providing, among other things, for a reduction in the
profit margins applicable to the sale of Products under
the Agreement in consideration of (i) certain payments
made by ESASI to SASI, and (ii) the transfer by ESASI
to SASI of all of ESASI's ownership interest in SASI.
SASI concurrently assigned the Agreement, as amended,
to the Partnership. The Amendment was within the
contemplation of the original Agreement which made
provision for subsequent pricing adjustments and the
1992 Order which required that ESASI divest its SASI
stock at a future date.
(b) In furtherance of ESASI's efficient lighting and
energy management services business, and consistent
with the letter dated December 5, 1994 from William T.
Baker, Jr. of Reid & Priest to William C. Weeden
confirming ESASI's authorization to acquire
intellectual property related thereto, ESASI and SASI
entered into an Asset Purchase Agreement pursuant to
which ESASI purchased from SASI all of SASI's right,
title and interest in the Electronic Ballast Device
(the "Ballast") and certain other energy efficiency
technologies (and related intellectual property) owned
by SASI which are not governed by the Exclusive
Distribution Agreement.
(c) In furtherance of ESASI's efficient lighting and
energy management services business, and consistent
with the letter dated December 5, 1994 from William T.
Baker, Jr. of Reid & Priest to William C. Weeden
confirming ESASI's authorization to acquire
intellectual property related thereto, ESASI and SASI
entered into an Option Agreement pursuant to which
ESASI acquired, for a period of five (5) years, an
option to purchase all of SASI's right, title and
interest in the Edison 21 Monitor that is currently
distributed by Entergy SASI pursuant to the Exclusive
Distribution Agreement; ESASI's exercise of this option
will be subject to the receipt of any requisite
authorization of the SEC.
In connection with the foregoing transactions,
ESASI, SASI, the Partnership and/or the stockholders of
SASI entered into certain ancillary contracts including
the following:
(i) A Manufacturing Agreement pursuant to which the
Partnership will continue to manufacture the Ballast
for ESASI at current pricing levels for a term of one
(1) year, subject to extension by mutual agreement of
the parties.
(ii) A Confidentiality and Non-Competition
Agreement pursuant to which SASI agrees to maintain the
confidentiality of ESASI's proprietary information and
not to compete with ESASI in the energy management
services business.
(iii) A Security Agreement granting Entergy SASI
a security interest in certain deferred payments to be
made by ESASI to SASI under the Asset Purchase
Agreement (the "Security Interest") for the purpose of
securing the due payment and performance of all
obligations of SASI under the Asset Purchase Agreement
and the other agreements referenced above.
(iv) An Agreement to terminate the Investor Rights
Agreement, dated December 29, 1992.
(v) A Consent and Assumption Agreement pursuant
to which (i) ESASI consented to the transfer by SASI of
substantially all of its assets and liabilities to the
Partnership and to the grant of the Security Interest,
as required pursuant to Sections 6.01 (a), (b) and (c)
of the Loan Agreement, dated December 29, 1992, between
ESASI and SASI (the "Loan Agreement"), and (ii) the
Partnership agreed to assume the obligations of SASI
under the Loan Agreement as a joint and several
liability with SASI.
Filed herewith and attached as exhibits hereto are:
Exhibit B-3(c) First Amendment to Exclusive Distribution Agreement
Exhibit B-4(c) Consent and Assumption Agreement
Exhibit B-6(c) Agreement to Terminate Investor Rights Agreement.
<PAGE>
IN WITNESS WHEREOF, the undersigned companies have
caused this Certificate to be executed this 5th day of May,
1995.
ENTERGY CORPORATION
ENTERGY ENTERPRISES, INC.
By: /s/ Michael G. Thompson
Michael G. Thompson
Senior Vice President,
Chief Legal Officer
and Secretary
ENTERGY SYSTEMS AND SERVICE, INC.
By: /s/ Michael G. Thompson
Michael G. Thompson
Vice President and Secretary
Exhibit B-3(c)
FIRST AMENDMENT TO EXCLUSIVE DISTRIBUTION AGREEMENT
THIS FIRST AMENDMENT TO EXCLUSIVE DISTRIBUTION AGREEMENT
(the "Amendment") is made, effective as of the 20th day of April,
1995, by and between Systems & Service International, Inc., a
Delaware corporation having a place of business at 4400 South
Mendenhall, Suite 8, Memphis, Tennessee 38141 ("SASI"), Systems &
Service International Manufacturing, L.P., a Tennessee limited
partnership ("SASI Manufacturing") and Entergy Systems and
Service, Inc., a Delaware corporation having a place of business
at 4740 Shelby Drive, Suite 105, Memphis, Tennessee 38118
("ESASI").
BACKGROUND
WHEREAS, on December 29, 1992, SASI and ESASI, formerly
known as Systems and Service, U.S.A., Inc., entered into that
certain Exclusive Distribution Agreement (the "Agreement") by
which, among other things, ESASI obtained the exclusive right to
distribute SASI's Edison-21 Monitor product line (the "Monitor"),
together with enhancements thereto, within a defined territory
and non-exclusive distribution rights to distribute such products
in the remainder of the United States; and
WHEREAS, upon the execution of this Amendment, SASI intends
to transfer substantially all of its assets (including title to
the Monitor and its manufacturing assets) and liabilities to SASI
Manufacturing; and
WHEREAS, SASI desires to assign the Agreement to SASI
Manufacturing pursuant to Section 21 of the Agreement, subject to
the understanding that SASI shall not thereby be relieved of any
of its obligations thereunder; and
WHEREAS, pursuant to such assignment, SASI Manufacturing
will assume the rights and obligations of "Distributor"
thereunder; provided, however, that notwithstanding such
assignment, SASI shall not be relieved of any of its obligations
under the Agreement, but shall remain a party to the Agreement
and shall continue to be fully responsible for the performance
and discharge of all of the obligations and liabilities of
"Distributor" under the Agreement, as such Agreement may now or
hereinafter be amended, to the same extent as if such assignment
had not occurred;
WHEREAS, SASI intends to require that SASI Manufacturing use
its best efforts, after said assignment, to engage a professional
manager to manage the manufacturing business; and
WHEREAS, the parties, also, now desire to amend the
Agreement in accordance with Section 28 thereof.
NOW, THEREFORE, the parties do hereby covenant and agree as
follows:
SECTION I
THE AMENDMENTS
In consideration of ESASI's payment to SASI of the amount of
$4,450,000, receipt of which is hereby acknowledged, and (b) the
transfer by ESASI to SASI, as of the effective date of this
Amendment, of 760 shares of the Common Stock of SASI,
constituting all of ESASI's ownership interest in SASI, the
parties hereby agree to amend the Agreement as follows:
A. Section 2.1 of the Agreement is hereby amended at the
end of the first sentence thereof, by adding the following
phrase: "provided, however, in no event shall the Electronic
Ballast Product Line, as defined in Exhibit 2.1 hereto, together
with any enhancements thereto, be deemed a "comparable" product
within the meaning of this Section 2.1."
B. A new Exhibit 2.1 is added to the Agreement (attached
as Schedule A hereto).
C. Exhibit 6.1 of the Agreement is hereby deleted in its
entirety and, in its place and stead, is inserted a new Exhibit
6.1 (attached as Schedule B hereto).
D. Section 6.3 of the Agreement is hereby amended by
adding the following to the end of said Section: "Commencing on
the effective date of the First Amendment to this Agreement,
Producer shall exercise its reasonable best efforts to reduce the
Cost of producing the Products."
E. A new Section 31 is hereby added to the Agreement to
read as follows: "Section 31. Confidentiality and Non-
Competition Agreement. As of the effective date of the First
Amendment to this Agreement, Producer and Distributor shall enter
into a Confidentiality and Non-Competition Agreement in
substantially the form attached as Exhibit 31 hereto."
F. A new Exhibit 31 is added to the Agreement (attached as
Schedule C hereto).
SECTION II
PAUL WILLIAMS
Producer hereby represents that Paul Williams has divested
or contemporaneously with the execution and delivery hereof will
divest his ownership interest in SASI and, as of the effective
date hereof, is no longer a stockholder of Producer, and the
Voting Agreement between Paul Williams, SASI and Entergy SASI
dated December 29, 1992 is terminated concurrently herewith.
SECTION II
CONTINUED EFFECTIVENESS
Except as provided above, the Agreement remains in effect as
before, unamended and unchanged in any other respect.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this
FIRST AMENDMENT to be executed in duplicate by their respective
duly authorized representatives.
SYSTEMS & SERVICE ENTERGY SYSTEMS AND SERVICE,
INTERNATIONAL, INC. INC.
By: /s/ Kenneth R. Breeden By: /s/ John L. Bosch
Kenneth R. Breeden, John L. Bosch, Vice President
President
SYSTEMS & SERVICE INTERNATIONAL
MANUFACTURING, L.P.
By: /s/ Dudley G. Boyd
Dudley G. Boyd
<PAGE>
SCHEDULE A TO FIRST AMENDMENT TO DISTRIBUTION AGREEMENT
EXHIBIT 2.1
ELECTRONIC BALLAST LINE
The Ballast Line of Products constitutes 4 specific
electronic ballast models covering the following lamp types:
4-FT 120 VOLT BALLAST
4-FT 227 VOLT BALLAST
8-FT 120 VOLT BALLAST
8-FT 227 VOLT BALLAST
The Electronic Ballast Product Line shall also include any
additional models of the Electronic Ballast that may hereinafter
be developed utilizing the same or similar technology, and any
improvements or enhancements thereto.
<PAGE>
SCHEDULE B TO FIRST AMENDMENT TO DISTRIBUTION AGREEMENT
EXHIBIT 6.1
The purchase price of the Products to Distributor will be equal
to Producer's Costs, plus a variable factor. Such factor is
established at the following levels unless otherwise mutually
agreed:
Through December 31, 1996, all units at Cost plus 50%;
Beginning January 1, 1997, all units at Cost plus 20%.
"Cost" shall be as reflected on Schedule 6.1 attached hereto.
Defined terms used in this Exhibit 6.1 shall have the meanings
set forth in the Exclusive Distribution Agreement of which this
Exhibit 6.1 is a part.
<PAGE>
SCHEDULE 6.1
EXHIBIT 6.1 (CONT.) TO EXCLUSIVE DISTRIBUTION AGREEMENT
Distributor will charge a variable factor representing
manufacturing overhead based on the following principles:
ANALYSIS OF INDIRECT PRODUCTION COSTS
FOR FULL ABSORPTION
Classification for
financial reporting
purposes
Usually in- Not usually
cluded in included in
inventori- inventori-
able costs able costs
Cost capitalized as inventory
for tax purposes
Repairs and maintenance X
Utilities X
Rent X
Bidding costs on successful bids X
Indirect labor and production
supervisory wages, including basic
compensation, overtime pay,
vacation and holiday pay, sick
leave other than payments pursuant
to a wage continuation plan under
section 105(d), shift differential,
payroll taxes and contributions
to a supplemental unemployment
benefit plan X
Indirect materials and supplies X
Tools and equipment not capitalized X
Costs of quality control and
inspection X
Distribution and warehousing costs
(finished goods) (1) (1)
General and administrative expenses
attributable to business activities
as a whole X
Engineering and design expense
(to the extent not research and
experimental) (2) (2)
Officers' salaries related to business
activity as a whole X
Officers' salaries related to
production (3) (3)
Pension contributions representing
current service costs (4) X
Profit-sharing contributions (4) X
Other employee benefit costs, in-
cluding workmen's compensation
expenses, payments under wage
continuation plan described in
section 105(d), amounts in-
cludable in income of an employee
under nonqualified pension,
profit-sharing and stock bonus
plans, premiums on life and health
insurance and miscellaneous
employee benefits (4) (5) X
Depreciation (6) X
Taxes, excluding state, local
foreign income taxes (6) X
Factory administrative expenses X
Costs attributable to re-
work labor, scrap and spoilage X
Insurance incident to production X
Pension contributions representing
past service costs (7) (7)
Marketing, advertising and selling
expenses X
Research and experimental expenses X
Losses from casualty or theft X
Income taxes attributable to income
received on sale of inventory X
Notes:
1 - Although there is no authoritative guidance, individual
facts and circumstances should determine if these costs
are capitalizable.
2 - Nature of activities will govern if costs are
capitalizable.
3 - Officers' salaries related to production are included or
excluded dependent on nature and size of business and/or
specificity of identification of officers' duties with
production effort.
4 - Applies to employees incident to or necessary for
production or manufacturing operations.
5 - Certain elements such as recreational facilities for
employees, expenses in support of recreation (such as an
employee bowling league) and similar costs frequently
are not included.
6 - Applies to assets incident to or necessary for
production or manufacturing.
7 - Although there is predominant practice regarding past
service costs, it is the firm's position that it is
usually preferable to include such costs in
inventoriable costs.
<PAGE>
SCHEDULE C TO FIRST AMENDMENT TO DISTRIBUTION AGREEMENT
CONFIDENTIALITY AND NON-COMPETITION AGREEMENT
THIS AGREEMENT is made as of this 20th day of April, 1995 by
and between SYSTEMS & SERVICE, INTERNATIONAL, INC. a Delaware
Corporation (hereinafter referred to as "SASI") and ENTERGY
SYSTEMS AND SERVICE, INC., a Delaware corporation (hereinafter
called "Distributor").
WITNESSETH:
WHEREAS, on December 29, 1992, SASI and Distributor,
formerly known as Systems and Service U.S.A., Inc., entered into
that certain Exclusive Distribution Agreement (which, together
with any amendments thereto, is referred to herein as the
"Distribution Agreement") by which among other things,
Distributor obtained the exclusive right to distribute SASI's
Edison 21 Monitor product line, (the "Monitor") together with
enhancements thereto, within a defined territory (the
"Territory") and non-exclusive distribution rights to distribute
such products in the remainder of the United States; and
WHEREAS, concurrently with the execution of this Agreement,
SASI has transferred substantially all of its assets (including
title and ownership of the Monitor and its manufacturing assets)
and liabilities to an affiliated company, Systems & Service
International Manufacturing L.P. ("SASI Manufacturing"), and
assigned the Distribution Agreement to SASI Manufacturing
(subject to the understanding that such agreement does not
release SASI from any of its obligations as "Producer"
thereunder); and
WHEREAS, in connection with the performance of the
Distribution Agreement, Distributor has disclosed, or may
hereafter disclose, to SASI confidential and proprietary
information relating to the conduct of its energy management
services business (as hereinafter defined), which information may
include without limitation, its business plans, methods and
procedures, customer lists, technical and financial information,
and other trade secrets and know how (collectively, the
"Proprietary Information"); and
WHEREAS, Distributor desires that SASI, SASI Manufacturing
and, as necessary or appropriate, the executive officers and
employees thereof (including, specifically, but not limited to,
the Restricted Persons (as hereinafter defined)), maintain the
confidentiality of all Proprietary Information that it or they
have or may hereafter receive from SASI and, not use such
information in competition with Distributor in the energy
management services business; and
WHEREAS, in consideration of the payments provided for
herein below, SASI is willing, on behalf of itself and SASI
Manufacturing and, as necessary or appropriate, the shareholders,
executive officers and employees thereof, to maintain the
confidentiality of Distributor's Proprietary Information and to
agree not to compete with Distributor in the energy management
services business.
NOW THEREFORE, the parties hereto covenant and agree as
follows:
1. In the performance of the Distribution Agreement or
otherwise in connection therewith, SASI, SASI Manufacturing, and
its and their stockholders, directors, employees or partners, as
the case may be, have received or had access, or may hereafter
receive or have access, to the Proprietary Information of
Distributor. SASI agrees that neither (a) SASI, (b) SASI
Manufacturing, or (c) Dudley Boyd ("Boyd"), the Chairman of the
Board of Directors of SASI and the Trustee of the Boyd Revocable
Trust, a principal shareholder of SASI, (d) Paul Williams
("Williams"), a principal shareholder of SASI, or (e) Kenneth
Breeden, the President and member of the Board of Directors of
SASI ("Breeden") (Boyd, Williams and Breeden collectively
referred to herein as the "Restricted Persons") shall at any time
(including after the expiration or termination of the
Distribution Agreement) in any way or manner whatsoever, make
known, divulge or communicate the Proprietary Information, or any
part thereof. Without limiting the generality of the foregoing,
SASI shall take, and shall cause SASI Manufacturing to take, at
least such steps to preserve the confidentiality of any
Proprietary Information that has been, or may hereafter be
disclosed to it or SASI Manufacturing, as SASI takes to preserve
its own confidential and proprietary information of like
importance. SASI and SASI Manufacturing shall only disclose such
Proprietary Information to its or their stockholders, directors
or employees (including, without limitation, the Restricted
Persons") upon whom it or they have imposed an express
contractual obligation to observe the Distributor's rights under
this Agreement. Except as may be expressly authorized by
Distributor in writing, or as expressly authorized by this
Agreement, neither SASI, SASI Manufacturing, or any Restricted
Person may at any time (a) disclose, duplicate, or otherwise use
the Proprietary Information for any purpose other than as
expressly agreed by Distributor, or (b) permit the disclosure,
duplication, or use of the Proprietary Information by any other
person.
2. Section 1 above shall not apply to: (1) Proprietary
Information that has become publicly known without a breach of
this Agreement, or (2) Proprietary Information that SASI or SASI
Manufacturing can show, from written documents in disclosee's
files, was in its possession at the time of disclosure by
Distributor and was not acquired, directly or indirectly, from
Distributor, or (3) Proprietary Information that has become known
to SASI or SASI Manufacturing subsequent to Distributor's
disclosure of such Proprietary Information to disclosee, without
breach of any obligation of confidentiality owed Distributor, and
without a like obligation of confidentiality.
3. Upon any termination of the Distribution Agreement, no
matter how occasioned, SASI shall promptly return, and shall
cause SASI Manufacturing to promptly return, to Distributor all
tangible or retrievable materials containing or constituting
Proprietary Information.
4. If, at any time, either party becomes aware of any
unauthorized access, use, possession, or knowledge of any
Proprietary Information, that party shall immediately notify the
other in writing. SASI shall provide any and all reasonable
assistance to Distributor to protect the confidentiality of any
Proprietary Information which SASI or SASI Manufacturing may
have, directly or indirectly, disclosed or made available in
breach of this Agreement. SASI shall also take all reasonable
steps requested by Distributor to prevent the reoccurrence of
such unauthorized access, use, possession, or knowledge.
5. During the term of the Distribution Agreement, or for a
period of five (5) years from the date hereof, whichever is
greater (the "Restricted Period"), SASI agrees that neither SASI,
SASI Manufacturing nor any Restricted Person will (i) either
directly or indirectly, by or for itself or himself, or in
conjunction with any other person, company, association,
partnership, corporation or other entity (a "Restricted Entity")
own, manage, operate, control, invest in or acquire an interest
in, or otherwise engage in or participate in, whether as
proprietor, partner, stockholder, director, officer, "Key
Employee" (defined herein to include any person who is employed
in a management, executive, supervisory, marketing or sales
capacity for another person), joint venturer, investor or other
participant, any business which competes, directly or indirectly,
in the "energy management business," as more particularly defined
in Schedule A (the "Business"), in the geographic area where
Distributor is conducting or currently plans to conduct business
during such Restricted Period, as set forth in Schedule B, or
(ii) interfere with, disrupt or attempt to disrupt the
relationship, contractual or otherwise, between Distributor and
any lessor, lessee or Key Employee of Distributor or between
Distributor and any of its customers or suppliers.
SASI acknowledges and agrees that the territorial and time
limitations set forth in Section 5 are reasonable and necessary
for the adequate protection of the Business of Distributor.
Notwithstanding the foregoing, SASI, SASI Manufacturing and
the Restricted Persons shall be permitted to own not more than 5%
of the outstanding voting capital stock of a publicly owned
corporation engaged in a business which is in competition with
the Business so long as neither SASI, SASI Manufacturing, or any
such Restricted Person is in control of such corporation, nor
serves as a director, officer, employee or consultant to such
corporation.
6. During the Restricted Period, SASI agrees that neither
SASI, SASI Manufacturing or any Restricted Person or Restricted
Entity, or any affiliate thereof, will (a) directly or
indirectly solicit, induce or influence any customer, supplier,
lendor, lessor, distributor or subdistributor, or any other
person that has a business relationship with Distributor, at any
time during the Restricted Period, to discontinue or reduce the
extent of such relationship with Distributor, (b) directly or
indirectly recruit, solicit or otherwise attempt to induce or
influence any employee or sales agent of Distributor to
discontinue such employment or agency relationship with
Distributor, or (c) employ or seek to employ, or cause or permit
any other person to employ or seek to employ for any business
which is in competition with the Business, any person who is then
(or was at any time within six months prior thereto) employed by
Distributor.
7. Notwithstanding any other provision hereof to the
contrary, (a) in no event shall any Restricted Person be required
to comply with the obligations of Sections 5 and 6 above for a
period in excess of five (5) years following the termination of
his association with SASI or SASI Manufacturing (whether as a
shareholder, executive officer or director thereof) or, if less,
the maximum period permitted by applicable law, and (b) SASI for
SASI Manufacturing shall be permitted to continue to sell
Products (as such term is defined in the Distribution Agreement)
to non-affiliated energy management service providers or
contractors for sale or distribution to end users outside the
"Territory" and to sell any "Non-Exclusive Products" to such
persons within the Territory (as such terms are defined in the
Distribution Agreement).
8. SASI acknowledges that in the event that it, SASI
Manufacturing, or any Restricted Person or Restricted Entity,
violates the terms of this Agreement, such violation may result
in irreparable injury for which Distributor may not have any
adequate remedy at law. SASI therefore agrees that, in the event
of any breach of this Agreement, Distributor may, in its sole
discretion and in addition to any other remedies available to it,
bring an action or actions for injunctive relief, specific
performance, or both, and have entered a temporary restraining
order, preliminary or permanent injunction, or order compelling
specific performance, and if successful, recover its actual costs
and reasonable attorney's fees related to or arising from such an
action or actions.
9. SASI represents that (a) it will enter into an
appropriate agreement with SASI Manufacturing and (b) it will
enter into appropriate agreements with each of the Restricted
Persons (or will cause SASI Manufacturing to enter into such
agreements), incorporating the provisions and requirements of
this Agreement for the purpose of assuring that SASI
Manufacturing and each of such persons comply with each of the
obligations set forth herein.
10. Subject to Sections 11, 12 and 14 below, in
consideration of the covenants and agreements to be performed by
SASI, SASI Manufacturing, the Restricted Persons and the
Restricted Entities pursuant to the terms hereof, Distributor
shall pay SASI the amounts set forth in Schedule C hereto (the
"Non-Compete Payments") at the times set forth in such Schedule C.
11. In the event that SASI, SASI Manufacturing, or any
Restricted Person or Restricted Entity fails in any material
respects to comply with any of its or their obligations under
this Agreement (a "Default"), then, in addition to any rights and
remedies otherwise available to Entergy SASI, Entergy SASI shall
have the right, at its option, either to (a) immediately
terminate this Agreement without further financial obligation, or
(b) be relieved of any obligation to pay the next succeeding Non-
Compete Payment and all succeeding Non-Compete Payments that
would otherwise thereafter become due, until such Default has
been cured and all obligations of SASI, SASI Manufacturing, the
Restricted Persons and Restricted Entities have been properly
performed, for a minimum period of twelve (12) consecutive
months. Entergy SASI shall give prompt notice to SASI and each
Restricted Person of a Default, which notice shall state with
reasonable specificity the activities or conduct resulting in
such Default and identification of the party or parties causing
such Default.
12. Distributor shall be entitled to offset and deduct from
the Non-Compete Payments otherwise payable hereunder, the amount
of any and all losses, damages or liabilities which Distributor
may incur by reason of any breach of the obligations set forth in
this Agreement by SASI, SASI Manufacturing, or any Restricted
Person or Restricted Entity.
13. Any notice provided for in this Agreement must be in
writing and must be either personally delivered, or mailed by
first class mail, certified, return receipt requested, to the
recipient at the address below indicate:
To the Distributor: Entergy Systems and Service, Inc.
4740 Shelby Drive
Suite 105
Memphis, TN 38118
Attention: John L. Bosch
with a copy to: Entergy Services, Inc.
639 Loyola Avenue
New Orleans, LA 70113
Attention: Legal Department
To SASI: 4400 South Mendenhall
Suite 8
Memphis, TN 38141
Attention: Dudley G. Boyd
with a copy to: Matthew S. Heiter, Esquire
Waring Cox, PLC
Suite 1300
50 North Front Street
Memphis, TN 38103
or such other address or to the attention of such other person as
the recipient party shall have specified by prior written notice
to the sending party. Any notice under this agreement will be
deemed to have been given when so delivered or mailed.
14. It is the desire and intent of the parties that the
provisions of this Agreement shall be enforced to the fullest
extent permissible under the laws and public policies applied in
each jurisdiction in which the enforcement is sought.
Accordingly, if a court determines that any provision of this
Agreement is unenforceable because of the duration or scope of
such provision or otherwise, at Distributor's option: (a) to the
extent permitted by law, Distributor shall have the right to
terminate this Agreement without further obligation or (b) such
provision shall be deemed amended in such a manner as a court may
deem reasonable and enforceable, but only with respect to the
operation of such provision in the particular jurisdiction in
which such adjudication is made.
15. This Agreement embodies the complete agreement and
understanding among the parties and supersedes and preempts any
prior understanding, agreements or representations by or among
the parties, written or oral, which may have related to the
subject matter hereof in any way. This Agreement may not be
modified in any manner except by a written agreement duly
authorized and signed by both parties.
16. This Agreement may be executed in separate
counterparts, each of which is deemed to be an original and all
of which taken together constitute one and the same Agreement.
17. All captions in this Agreement are inserted for
convenience only and shall not be deemed to constitute a part of
this Agreement nor to affect the meaning of any provision hereof.
18. This Agreement will be governed by the laws of the
State of Tennessee.
19. Any provisions of this Agreement may be amended or
waived only with the prior written consent of SASI and
Distributor.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be duly executed the day and year first above
written.
SYSTEMS & SERVICE INTERNATIONAL, INC.
By: ____________________________________
Kenneth Breeden, President
ENTERGY SYSTEMS AND SERVICE, INC.
By: ____________________________________
John L. Bosch, Vice President
Exhibit B-4(c)
CONSENT AND ASSUMPTION AGREEMENT
THIS AGREEMENT made as of the 20th day of April, 1995, by
and between ENTERGY SYSTEMS AND SERVICE, INC., a Delaware
corporation ("Entergy"), SYSTEMS & SERVICE INTERNATIONAL, INC., a
Delaware corporation (the "Company") and SYSTEMS & SERVICE
INTERNATIONAL MANUFACTURING, L.P., a Tennessee limited
partnership (the "Partnership").
W I T N E S S E T H:
WHEREAS, the Company has proposed to sell certain technology
to Entergy pursuant to an Asset Purchase Agreement between the
Company, Entergy and certain stockholders and officers of the
Company dated as of April 20, 1995; and
WHEREAS, the Company proposes to transfer substantially all
of its assets and liabilities to the Partnership in exchange for
a limited partnership interest, which transfer is subject to the
existing rights of Entergy; and
WHEREAS, the Company proposes to grant Entergy a security
interest in certain deferred payments to be made to the Company
under the Asset Purchase Agreement (the foregoing transactions
collectively referred to herein as the "Transactions"); and
WHEREAS, Entergy and the Company are parties to a Loan
Agreement dated December 29, 1992 (the "Loan Agreement"), and the
Company's indebtedness to Entergy is evidenced by a Promissory
Note dated December 29, 1992 in the principal amount of
$2,700,000 (the "Note"); and
WHEREAS, in accordance with the terms of the Loan Agreement,
the consent of Entergy is required in order for the Company to
effectuate the Transactions; and
WHEREAS, pursuant to the terms of the Loan Agreement,
Entergy desires to consent to the Transactions, subject to the
agreement of the Partnership to become a party to the Loan
Agreement and to assume, jointly and severally with the Company,
all obligations and liabilities of "Borrower" thereunder;
NOW, THEREFORE, in consideration of the foregoing, and the
covenants contained herein, and for other good and valuable
consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties agree as follows:
1. Assumption. The Partnership hereby assumes and
undertakes to perform all obligations of the Company under the
Loan Agreement and the Note.
2. Consent. Entergy hereby consents to the Transactions
and waives application of the negative covenants contained in
Sections 6.01(a), (b) and (c) of the Loan Agreement with respect
to the Transactions. All of the other terms, conditions and
covenants of the Loan Agreement shall remain in full force and
effect.
3. Confirmation of Indebtedness. The Company hereby
ratifies and affirms all of its obligations arising under the
Loan Agreement and the Note as a joint and several liability with
the Partnership, and ratifies and affirms all obligations under
any and all other instruments and documents evidencing, securing
or otherwise relating to the indebtedness evidenced by the Note
to which the Company is a party.
4. Parties in Interest. This Agreement shall inure to the
benefit of and be binding upon the parties hereto, and their
respective successors and assigns.
5. Law to Govern. This Agreement shall be governed by,
and construed and enforced in accordance with, the laws of the
State of Tennessee, without regard to principles of conflicts of
laws.
6. Counterparts. This Agreement may be executed in one or
more counterparts, each of which shall be deemed an original, but
all of which together shall constitute one and the same
instrument.
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first above written.
SYSTEMS & SERVICE INTERNATIONAL, INC.
By: /s/ Kenneth Breeden
Kenneth Breeden, President
SYSTEMS & SERVICE INTERNATIONAL
MANUFACTURING, L.P.
BY: SYSTEMS & SERVICE INTERNATIONAL R&D
AND MANUFACTURING, INC., its
General Partner
By: /s/ Dudley G. Boyd
Dudley G. Boyd, President
ENTERGY SYSTEMS AND SERVICE, INC.
By: /s/ John L. Bosch
John L. Bosch, Vice President
Exhibit B-6(c)
AGREEMENT TO TERMINATE INVESTOR RIGHTS AGREEMENT
THIS AGREEMENT made and entered into this _____ day of
April, 1995, by and among SYSTEMS & SERVICE INTERNATIONAL, INC.,
a Delaware corporation ("SASI"), PAUL E. WILLIAMS ("Williams"),
BOYD REVOCABLE INTER-VIVOS TRUST ("Trust"), W. T. CALLAWAY, JR.
("Callaway"), DELTOVE LIMITED ("Deltove") and ENTERGY SYSTEMS AND
SERVICE, INC. ("Entergy").
W I T N E S S E T H:
WHEREAS, Williams, Trust, Callaway, Deltove and Entergy are
all of the stockholders of SASI; and
WHEREAS, SASI, Williams, Trust, Callaway, Deltove and
Entergy entered into an Investor Rights Agreement dated December
29, 1992 (the "Investor Rights Agreement"); and
WHEREAS, the parties desire to mutually terminate the
Investor Rights Agreement.
NOW, THEREFORE, in consideration of the foregoing, and the
mutual covenants contained herein, and other good and valuable
consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties agree as follows:
1. The Investor Rights Agreement is terminated, shall be
null and void and have no further effect, and none of the parties
shall have any further obligations to the other thereunder;
provided, however, that such termination shall not affect any
obligations or liabilities of the parties arising thereunder
which may have accrued prior to the effective date hereof.
2. The Investor Rights Agreement is terminated
notwithstanding any provisions contained therein regarding
termination or term.
3. This Agreement and all transactions contemplated herein
shall be governed by, and construed and enforced in accordance
with, the corporate law of the State of Delaware without regard
to principles of conflicts of laws.
4. This Agreement shall inure to the benefit of and be
binding upon the parties, and their respective heirs, executors,
administrators, successors and permitted assigns.
5. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument.
6. This Agreement sets forth the entire understanding of
the parties, and supersedes all other representations, agreements
and understandings, oral or otherwise, between or among the
parties with respect to the matters contained herein.
IN WITNESS WHEREOF, the parties have set their hands as the
date first above written.
/s/ Paul Williams
PAUL WILLIAMS
BOYD REVOCABLE INTER-VIVOS TRUST,
u/d/t November 1, 1990
By:/s/ Dudley Boyd
Dudley Boyd, Trustee
ENTERGY SYSTEMS AND SERVICE, INC.
By: /s/ Paul E. Williams
Paul E. Williams, President
DELTOVE LIMITED
By: /s/ Michael Nobrega
Michael Nobrega, President
/s/ W.T. Callaway, Jr.
W.T. CALLAWAY, JR.
SYSTEMS & SERVICE INTERNATIONAL,
INC.
By: /s/ Kenneth Breeden
Kenneth Breeden, President
