EXHIBIT 99.4
SUBORDINATION AND INTERCREDITOR AGREEMENT
THIS SUBORDINATION AND INTERCREDITOR AGREEMENT (this "Agreement") is
entered into as of this 29th day of December, 2000 by and among the Persons
identified on the signature pages hereto or on any joinder executed in
connection herewith as a Subordinated Creditor (each such Person is individually
referred to herein as a "Subordinated Creditor" and collectively as the
"Subordinated Creditors"), LIBRA MEZZANINE PARTNERS II-A, L.P., a Delaware
limited partnership, as agent for the Subordinated Creditors (in such capacity,
the "Subordinated Agent"), EMERGENT INFORMATION TECHNOLOGIES, INC., a California
corporation (the "Borrower"), and MELLON BANK, N.A., a United States banking
corporation, as Agent for all Senior Lenders party to the Senior Credit
Agreement described below.
Recitals
A. Pursuant to a Second Amended and Restated Credit and Security
Agreement, dated as of even date herewith (as the same may be amended,
supplemented or otherwise modified from time to time, the "Senior Credit
Agreement"), among the Borrower, Agent, Xxxxx Fargo Bank, N.A., as co-agent, and
Senior Lenders (as hereinafter defined), Senior Lenders have agreed, subject to
the terms and conditions set forth in the Senior Credit Agreement, to make
certain loans and financial accommodations to the Borrower. All of the
Borrower's obligations to Agent and Senior Lenders under the Senior Credit
Agreement and the other Senior Debt Documents (as hereinafter defined) are
secured by liens on and security interests in substantially all of the now
existing and hereafter acquired real and personal property of the Borrower.
B. The Borrower and the Subordinated Creditors have entered into a
Note and Stock Purchase Agreement of even date herewith (as the same may be
amended, supplemented or otherwise modified from time to time as permitted
hereunder, the "Subordinated Note Purchase Agreement") pursuant to which (i) the
Subordinated Creditors are extending credit to the Borrower as evidenced by the
promissory notes of even date herewith in the aggregate principal amount of
$25,000,000 (as the same may be amended, supplemented, replaced or otherwise
modified from time to time as permitted hereunder, the "Subordinated Notes"),
and (ii) the Subordinated Creditors are acquiring 2,250,000 shares of the common
stock of the Borrower (the "Common Stock").
C. As an inducement to and as one of the conditions precedent to the
agreement of Agent and Senior Lenders to consummate the transactions
contemplated by the restated Senior Credit Agreement, Agent and Senior Lenders
have required the execution and delivery of this Agreement by the Subordinated
Creditors, Subordinated Agent and the Borrower in order to set forth the
relative rights and priorities of Agent, Senior Lenders, Subordinated Agent and
the Subordinated Creditors under the Senior Debt Documents (as hereinafter
defined) and the Subordinated Debt Documents (as hereinafter defined).
Agreement
NOW, THEREFORE, in order to induce the Agent and Senior Lenders to
consummate the transactions contemplated by the Senior Credit Agreement, and for
other good and valuable consideration, the receipt and sufficiency of which
hereby are acknowledged, the parties hereto hereby agree as follows:
1. The following terms shall have the following meanings in this
Agreement:
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"Agent" means Mellon Bank, N.A., as Agent for the Senior Lenders, or
any other Person appointed by the holders of the Senior Debt as agent for
purposes of the Senior Debt Documents and this Agreement.
"Bankruptcy Code" means Chapter 11 of Title 11 of the United States
Code, as amended from time to time and any successor statute and all rules and
regulations promulgated thereunder.
"Contingent Shares" means the shares issuable to the Subordinated
Creditors pursuant to Section 6.16 of the Subordinated Note Purchase Agreement.
"Key-Man Life Insurance Proceeds" means the proceeds of one or more
life insurance policies with aggregate face amounts of $6,000,000 insuring the
life of Xxxxxx Xxxxx (or such other person as may be selected by Subordinated
Creditors pursuant to the Subordinated Note Purchase Agreement), which life
insurance policies shall name the Subordinated Creditors as the sole
beneficiaries. The receipt of proceeds by any Subordinated Creditor and the
application of such proceeds to the Subordinated Debt shall be governed by
Section 2.06 of the Subordinated Note Purchase Agreement and shall not be
subject to the subordination provisions set forth in this Agreement.
"Mellon Loan Documents" means the Senior Credit Agreement and all
agreements, documents and instruments executed from time to time in connection
therewith, as the same may be amended, supplemented or otherwise modified from
time to time.
"Permitted Refinancing" means any refinancing of the Senior Debt under
the Mellon Loan Documents provided that (i) the financing documentation entered
into by the Borrower in connection with such Permitted Refinancing constitute
Permitted Refinancing Senior Debt Documents, (ii) the amount of such financing
does not exceed the Maximum Senior Debt Amount as set forth in the definition of
Senior Debt below, and (iii) such financing documentation does not in any way
prohibit the prepayments required under Section 2.06 or 6.11 of the Subordinated
Note Purchase Agreement, as in effect on the date hereof.
"Permitted Refinancing Senior Debt Documents" means any financing
documentation which replaces the Mellon Loan Documents and pursuant to which the
Senior Debt under the Mellon Loan Documents is refinanced, as such financing
documentation may be amended, restated, supplemented or otherwise modified from
time to time in compliance with this Agreement, but specifically excluding any
such financing documentation to the extent that it contains, either initially or
by amendment or other modification, any material terms, conditions, covenants or
defaults materially adverse to the Subordinated Lenders other than those which
(a) then exist in the Mellon Loan Documents, or (b) could be included in the
Mellon Loan Documents by an amendment or other modification that would not be
prohibited by the terms of this Agreement.
"Person" means any natural person, corporation, general or limited
partnership, limited liability company, firm, trust, association, government,
governmental agency or other entity, whether acting in an individual, fiduciary
or other capacity.
"Proceeding" shall have the meaning set forth in Section 4.
"Reorganization Securities" shall have the meaning set forth in
Section 4.
"Senior Debt Documents" means the Mellon Loan Documents and, after the
consummation of any Permitted Refinancing, the Permitted Refinancing Senior Debt
Documents.
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"Senior Debt" means all obligations, liabilities and indebtedness of
every nature of the Borrower from time to time owed to Agent or any Senior
Lender under the Senior Debt Documents, including, without limitation, the
principal amount of all debts, claims and indebtedness, accrued and unpaid
interest and all fees, costs and expenses, whether primary, secondary, direct,
contingent, fixed or otherwise, heretofore, now and from time to time hereafter
owing, due or payable (other than any letter of credit obligations to the extent
such obligations are secured by cash, cash equivalents or "back to back" letters
of credit, in each case in the amount of 105% of the undrawn face amount of the
underlying letter of credit), whether before or after the filing of a Proceeding
under the Bankruptcy Code together with (a) any amendments, modifications,
renewals or extensions thereof to the extent not prohibited by the terms of this
Agreement, and (b) any interest accruing thereon after the commencement of a
Proceeding; provided, however, that in no event shall the principal amount of
the Senior Debt exceed $30,000,000 less an amount equal to 100% of all payments
made by the Borrower to Senior Lenders which result in a permanent reduction in
the revolving commitment of the Senior Lenders under the Senior Debt Documents
after the date hereof (such amount being referred to as the "Maximum Senior Debt
Amount"). Senior Debt shall be considered to be outstanding whenever any loan
commitment under the Senior Debt Document is outstanding.
"Senior Lenders" means the holders of the Senior Debt.
"Subordinated Debt" means and includes each and every indebtedness,
liability or obligation of the Borrower to any Subordinated Creditor, whether
absolute or contingent, known or unknown, liquidated or unliquidated, secured or
unsecured, due or to become due, now existing or hereafter arising, evidenced by
or arising under the Subordinated Notes or any other Subordinated Debt Document,
regardless of how the same is evidenced or created and whether direct or
indirect or acquired by any Subordinated Creditor by way of assignment, and
regardless of whether the same is joint or several, and any and all renewals,
extensions, restructurings, modifications or replacements, in whole or in part,
of any of the foregoing. Notwithstanding anything to the contrary herein,
Borrower's obligations to any Subordinated Creditor with respect to the Common
Stock purchased pursuant to the Subordinated Note Purchase Agreement shall not
be deemed to be part of the Subordinated Debt.
"Subordinated Debt Documents" means the Subordinated Notes, the
Subordinated Note Purchase Agreement, any guaranty with respect to the
Subordinated Debt and all other documents, agreements and instruments now
existing or hereinafter entered into evidencing or pertaining to all or any
portion of the Subordinated Debt.
2. Except as provided in Section 4 below, the Subordinated Debt is
hereby subordinated and subject, in the manner and to the extent described
below, to any and all Senior Debt, so long as any of the Senior Debt shall
remain unpaid, in whole or in part, or Senior Lenders are committed or otherwise
obligated to extend credit to Borrower under the Senior Debt Documents.
3. Subordinated Agent, on behalf of the Subordinated Creditors,
agrees that it shall not: (a) demand payment of the Subordinated Debt except to
the extent permitted by this Agreement; (b) enforce or apply any security, now
or hereafter existing for the Subordinated Debt; (c) commence, prosecute or
participate in any administrative, legal, or equitable action against Borrower
concerning the Subordinated Debt (for the sake of clarity, the Subordinated
Creditor's right to elect directors pursuant to the Series L Preferred Stock
shall not be restricted by this clause (c)); or (d) take, maintain or enforce
any lien or security in any property, real or personal, other than the Key-Man
Life Insurance Proceeds to secure the Subordinated Debt, until the earliest to
occur of (i) the expiration of 180 days following Subordinated Agent's receipt
of a written notice (a "Senior Blockage Notice") that an "Event of Default"
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has occurred under the Senior Debt Documents, (ii) the Event of Default giving
rise to the Senior Blockage Notice is cured or waived, (iii) Senior Lenders have
otherwise terminated, withdrawn or rescinded such Senior Blockage Notice, (iv)
the occurrence and continuance of a Proceeding, (v) the commencement by Senior
Lenders of legal proceedings against Borrower to enforce remedies under the
Senior Credit Agreement, (vi) the acceleration by Senior Lenders of the maturity
of the Senior Debt, (vii) the payment in full in cash of all of the Senior Debt
and the termination of any commitment or obligation of Senior Lenders to extend
credit to Borrower under the Senior Debt Documents, and (viii) after ten (10)
business days written notice to Senior Lenders that Subordinated Creditors
intend to take any of the foregoing actions, and the failure by Senior Lenders,
prior to the expiration of such ten (10) business day period, to deliver a
Senior Blockage Notice as provided herein. Notwithstanding any provision of this
Agreement to the contrary, (x) no more than one Senior Blockage Notice may be
issued in any period of 365 consecutive days, and (y) no Event of Default under
the Senior Debt Documents existing on the date any Senior Blockage Notice is
given pursuant to this Agreement shall, unless the same shall have ceased to
exist or shall have been cured or waived in a writing provided to Subordinated
Creditors for a period of at least 90 consecutive days, be used as a basis for
any subsequent such notice, it being agreed and understood that breaches of the
same financial covenant for consecutive periods shall constitute separate and
distinct Events of Default.
4. Subject in all cases to the subordination provisions and other
limitations set forth below, the Borrower shall only be permitted to make and
the Subordinated Creditors may only retain: (i) regularly scheduled payments of
interest on the Subordinated Notes; (ii) regularly scheduled payments of
principal on the Subordinated Debt; (iii) Key-Man Life Insurance Proceeds, the
Contingent Shares, and Reorganization Securities (as defined below); (iv)
reasonable Subordinated Debt costs and expenses; (v) prepayments required under
Section 2.06 or 6.11 of the Subordinated Note Purchase Agreement; and (vi)
payments which the Senior Lenders elect to allow the Borrower to make to the
Subordinated Creditors (collectively, the "Permitted Junior Payments"). In the
event of any assignment by Borrower for the benefit of Borrower's creditors, any
bankruptcy proceedings instituted by or against Borrower, the appointment of any
receiver for Borrower or Borrower's business or assets, or any dissolution or
other winding up of the affairs of Borrower or of Borrower's business (each, a
"Proceeding"), and in all such cases, the officers of Borrower and any assignee,
trustee in bankruptcy, receiver or other person or persons in charge,
respectively, are hereby directed to pay to Senior Lender the full amount of the
Senior Debt before making any payments in respect of the Subordinated Debt to
Subordinated Creditors (other than the delivery of Reorganization Securities and
payment of Key-Man Life Insurance Proceeds). Notwithstanding anything in this
Agreement to the contrary (i) the failure by Borrower to make any payment or
deliver any property with respect to the Subordinated Debt by reason of the
operation of this Section 4 shall not be construed as preventing the occurrence
of a default under the Subordinated Debt Documents, (ii) subject in all cases to
clause (iii) below, except with respect to the receipt by Subordinated Agent or
any Subordinated Creditor of Permitted Junior Payments not the result of the
exercise of any remedies by Subordinated Agent or any Subordinated Creditor not
at the time permitted hereunder with respect to the Borrower, any guarantor of
the Subordinated Debt or any of their assets, or Reorganization Securities, at
any time that (A) any portion of the Senior Debt remains outstanding, (B) the
revolving commitments of the Senior Lenders under the Senior Debt Documents have
not been terminated, and (C) Subordinated Agent, or any of the Subordinated
Creditors, has received any payments or distributions of any kind or character
(whether in cash, securities, or otherwise) on account of the Subordinated Debt,
Subordinated Agent, or the applicable Subordinated Lender, shall hold all such
payments or distributions in trust for the Senior Lenders and shall forthwith
deliver all such payments or distributions (together with any necessary
endorsements thereto) to Agent; (iii) with respect to the receipt by
Subordinated Agent or any Subordinated Creditor of any Permitted Junior Payments
(except for Key-Man Life Insurance Proceeds and the reasonable costs and
expenses of Subordinated Creditors), at any time until the Senior Debt has been
paid in full in cash and all lending commitments under the Senior Debt Documents
have been terminated, that either (A) a Blockage Period
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(as defined below) is in effect, (B) a Proceeding has commenced and is
continuing, or (C) the Senior Lenders have accelerated the maturity of the
Senior Debt, Subordinated Agent, or the applicable Subordinated Lender, shall
hold all such payments or distributions in trust for the Senior Lenders and
shall forthwith deliver all such payments or distributions (together with any
necessary endorsements thereto) to Agent; (iv) Agent shall not be prohibited
from delivering to any Person any notices permitted or required to be delivered
by this Agreement or the Senior Debt Documents; and (v) Subordinated Creditors
may receive Key-Man Life Insurance Proceeds and the Contingent Shares, and
securities of Borrower or any other person or entity or securities of Borrower
as reorganized or readjusted, in each case issued to Subordinated Creditors in
respect of all or part of the Subordinated Debt and provided for by a plan of
reorganization or readjustment in a Proceeding of Borrower so long as (x) such
securities are securities subordinated to the Senior Debt at least to the same
extent as the Subordinated Debt are subordinated to the Senior Debt pursuant to
this Agreement, and (y) such securities are authorized by a court of competent
jurisdiction in a final order or decree which gives effect to this proviso
("Reorganization Securities"). A "Blockage Period" shall commence upon the
Subordinated Agent's receipt of a Senior Blockage Notice and shall terminate
upon the earliest of (i) the expiration of 180 days of receipt of such Notice,
(ii) upon the Event of Default giving rise to the Senior Blockage Notice being
cured or waived, (iii) upon the Senior Lenders terminating, withdrawing or
rescinding the Senior Blockage Notice, or (iv) the payment in full in cash of
all of the Senior Debt and the termination of any commitment or obligation of
Senior Lenders to extend credit to Borrower under the Senior Debt Documents. The
foregoing priority in payment shall apply at all times until all of the Senior
Debt has been repaid in full in cash and the revolving commitments of the Senior
Lenders have been irrevocably terminated.
5. Subordinated Agent agrees that it shall place or cause to be
placed a legend on the face of each Subordinated Note stating that the payment
thereof is subject to the terms of this Agreement and is subordinate to the
payment of all the Senior Debt. On or prior to the date of this Agreement,
Subordinated Agent agrees to deliver the original Subordinated Debt Documents to
Senior Lenders. Subordinated Agent agrees to xxxx all books of account in such
manner as to indicate that payment of the Subordinated Debt is subordinated
pursuant to the terms of this Agreement.
6. Subordinated Creditors agree that Senior Lenders shall have
absolute power and discretion, without notice to Senior Creditors, to deal in
any manner with the Senior Debt, including interest, costs and expenses payable
by Borrower to Senior Lenders, and any security therefor including, but not
limited to, release, surrender, extension, renewal, acceleration, compromise or
substitution; provided, however, that Senior Lenders shall not (a) increase the
amount of Senior Debt above the Maximum Senior Debt Amount, (b) increase the
interest rate with respect to the Senior Debt by more than 5.0% per annum,
except in connection with the imposition of a default rate of interest in
accordance with the terms of the Senior Debt Documents, (c) extend the final
maturity of the Senior Debt (as set forth in the Senior Credit Agreement in
effect on the date hereof) to later than January 31, 2003, (d) other than in
connection with an acceleration after a Default, shorten the amortization of any
portion of the Senior Debt (as set forth in the Senior Credit Agreement in
effect on the date hereof), or (e) change or amend any other term of the Senior
Debt Documents in a manner materially adverse to the Subordinated Creditors (in
each case, other than as expressly permitted hereunder, in the Senior Debt
Documents or in any Subordinated Debt Document). Subordinated Creditors each
hereby waive the right, if any, to require that Senior Lenders marshal, or
otherwise proceed to dispose of or foreclose upon, collateral Senior Lender may
have in any manner or order.
7. If, at any time hereafter, Senior Lenders shall, in their own
judgment, determine to discontinue the extension of credit to or on behalf of
Borrower, Senior Lender may do so. This Agreement, the obligations of
Subordinated Creditors owing to Senior Lenders hereunder, and Senior
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Lenders' rights and privileges hereunder shall continue until payment in full in
cash of all of the Senior Debt notwithstanding any action or non-action by Agent
or Senior Lenders with respect to the Senior Debt or with respect to any
collateral therefor or any guaranties thereof.
8. Each Subordinated Creditor agrees that it will not (a) at any time
contest the validity, perfection, priority or enforceability of the security
interests and liens granted by the Borrower (or any "Guarantor", as such term is
used and defined in the Senior Debt Documents) to the Senior Lenders or the
Borrower's (or any such Guarantor's) assets pursuant to the Senior Debt
Documents, or (b) until such time as the Senior Debt has been paid in full in
cash and the commitments of the Senior Lenders thereunder irrevocably
terminated, take a lien or security interest on any property of the Borrower
(other than in the Key-Man Life Insurance Proceeds) or any Guarantor other than
a judgment lien as a result of exercising such Subordinated Lender's remedies
pursuant to an enforcement action permitted hereunder. In the event any
Subordinated Creditor so obtains any such judgment lien, such lien shall be
deemed to be subordinate and junior to the liens of Senior Lenders without
further action on the part of Senior Lenders or Subordinated Creditors. Senior
Lenders agree that should Subordinated Creditors take enforcement action
permitted hereunder, they may receive in connection therewith judgment liens,
which liens shall be subject to the terms hereof.
9. Except as otherwise expressly agreed to herein, if Subordinated
Creditors shall receive any payments, security interests or other rights in any
property of Borrower in violation of this Agreement, or in the event any
Subordinated Creditor shall receive any payment or proceeds from the exercise of
remedies against or with respect to any property, whether real or personal, of
Borrower or any Guarantor (which remedies are not permitted hereunder) with
respect to which the Senior Lenders have a prior security interest, such payment
or property shall be received by Subordinated Creditors in trust for Senior
Lenders and shall forthwith be delivered and transferred to Senior Lenders. Upon
the payment in full in cash of all of the Senior Debt and the termination of any
commitment or obligation of Senior Lenders to extend credit to Borrower under
the Senior Debt Documents, Subordinated Creditors shall be subrogated to the
rights of Senior Lenders to receive payments and distributions of property or
securities with respect to the Senior Debt until the Subordinated Debt is paid
in full. If Senior Lenders shall receive any payment or distribution of cash,
property or securities after the payment in full in cash of all of the Senior
Debt and the termination of any commitment or obligation of Senior Lenders to
extend credit to Borrower under the Senior Debt Documents, such payment or
property shall be received by Senior Lenders in trust for Subordinated Creditors
and shall forthwith be delivered and transferred to the party or parties legally
entitled thereto.
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10. Until the Senior Debt has been paid in full in cash and all
lending commitments under the Senior Debt Documents have been terminated, and
notwithstanding anything to the contrary contained in the Subordinated Debt
Documents, no Subordinated Creditor shall, without the prior written consent of
Agent, agree to any amendment, modification or supplement to the Subordinated
Debt Documents the effect of which is to (a) increase the interest rate with
respect to the Subordinated Debt by more than 5% per annum (other than by the
imposition of the default rate of interest in accordance with the terms of the
Subordinated Notes), (b) change the dates upon which payments of principal or
interest on the Subordinated Debt are due, (c) change any redemption or
prepayment provisions of the Subordinated Debt, (d) alter the subordination
provisions with respect to the Subordinated Debt, including, without limitation,
subordinating the Subordinated Debt to any other indebtedness, (e) take any
liens or security interests in any assets of the Borrower or any guarantor of
the Subordinated Debt except as permitted by this Agreement, or (f) change or
amend any other term of the Subordinated Debt Documents if such change or
amendment would result in a default under the Senior Debt Documents.
11. Each Subordinated Creditor represents and warrants that it has
not previously subordinated the Subordinated Debt for the benefit of any other
person or entity, and agrees that any such subordinations hereafter executed
shall be expressly made subject and subordinate to the terms of this Agreement.
Subordinated Agent warrants that it has established with Borrower adequate means
of obtaining, on an ongoing basis, such information as Subordinated Creditors
may require which may affect the ultimate satisfaction by Borrower of the
Subordinated Debt. Senior Lenders shall have no duty, including to provide any
such information, to Subordinated Creditors except as expressly provided in this
Agreement.
12. This Agreement shall be binding upon the successors and assigns
of Subordinated Creditors, and shall inure to the benefit of Senior Lenders'
successors and assigns.
13. In the event of any dispute under this Agreement, the prevailing
party shall be entitled to recover its reasonable attorneys' fees and costs,
whether or not suit is brought.
14. This Agreement shall define the relative rights of Agent, Senior
Lenders, the Subordinated Creditors, and Subordinated Agent. Nothing in this
Agreement shall (a) impair, as among the Borrower, Agent and Senior Lenders and
as between the Borrower and the Subordinated Creditors, the obligation of the
Borrower with respect to the payment and performance of the Senior Debt and the
Subordinated Debt in accordance with the respective terms, or (b) affect the
relative rights of Agent, Senior Lenders, Subordinated Agent or the Subordinated
Creditors with respect to any other creditors of the Borrower.
15. In the event of any conflict between any term, covenant or
condition of this Agreement and any term, covenant or condition of any of the
Senior Debt Documents or the Subordinated Debt Documents, the provisions of this
Agreement shall control and govern.
16. In the event that any provision of this Agreement is deemed to be
invalid, illegal or unenforceable by reason of the operation of any law or by
reason of the interpretation placed thereon by any court or governmental
authority, the validity, legality and enforceability of the remaining provisions
of this Agreement shall not in any way be affected or impaired thereby, and the
affected provisions shall be modified to the minimum extent permitted by law so
as most fully to achieve the intention of this Agreement.
17. Each Subordinated Creditor, on its own behalf and on behalf of
its successors and assigns, hereby designates and appoints the Subordinated
Agent as its agent to accept and receive, on
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behalf of each such Person, any and all Senior Blockage Notices, and
Subordinated Agent hereby acknowledges and accepts such designation and
appointment and agrees to furnish copies thereof to each Subordinated Creditor
upon receipt. Notwithstanding any provision to the contrary contained elsewhere
in this Agreement or in any other Subordinated Debt Documents, the Subordinated
Agent shall not have any duties or responsibilities except those expressly set
forth herein nor shall the Subordinated Agent have or be deemed to have any
fiduciary relationship with any Subordinated Creditor and no implied covenants,
functions, responsibilities, duties, obligations or liabilities shall be read
into this Agreement, any Subordinated Debt Document or otherwise against the
Subordinated Agent. Subordinated Agent shall have no liability hereunder to
Subordinated Creditors or under any Subordinated Debt Document except for its
own gross negligence or willful misconduct.
18. Unless otherwise specifically provided herein, any notice
delivered under this Agreement shall be in writing addressed to the respective
party as set forth below and may be personally served, telecopied or sent by
overnight courier service or certified or registered United States mail and
shall be deemed to have been given (a) if delivered in person, when delivered,
(b) if delivered by telecopy, on the date of transmission if transmitted on a
business day before 4:00 p.m. (Los Angeles time) or, if not, on the next
succeeding business day, (c) if delivered by overnight courier, one business day
after delivery to such courier properly addressed; or (d) if by United States
mail, four business days after deposit in the United States mail, postage
prepaid and properly addressed.
Notice shall be addressed as follows:
If to any Subordinated Creditor or Subordinated Agent:
Libra Mezzanine Partners II-A, L.P.
00000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
With a copy to:
Rocky Mountain Capital Partners, LLP
0000 00xx Xx, Xxxxx 0000
Xxxxxx, XX 00000
Attention: Xxxxxx X. Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
With a copy to:
Sidley & Austin
000 Xxxx Xxxxx Xxxxxx, 00/xx/ Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx X. Xxxxx, Esq.
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
If to the Borrower:
Emergent Information Technologies, Inc.
0000 XxxXxxxxx Xxxxx, 0/xx/ Xxxxx
Xxxxxxx Xxxxx, Xxxxxxxxxx 00000
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Attention: Xxxxxx Xxxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
With a copy to:
Xxxxxxx & XxXxxxxx
000 Xxxxx Xxxxxxxxx, 00/xx/ Xxxxx
Xxxxx Xxxx, Xxxxxxxxxx 00000
Attention: Xxxxx Loss, Esq.
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
If to Agent or Senior Lenders:
Mellon Bank, X.X.
Xxxxxx Bank Center
000 Xxxxx Xxxx Xxxxxx, 0/xx/ Xxxxx
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attention: Xxxx Xxxx
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
With a copy to:
Xxxxxxx, Xxxxxxx & Xxxxxxxx, LLP
000 Xxxxx Xxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Attention: Xxxxx X. Xxxxxxxxxxx, Esq.
Telephone: (000) 000-0000
Telecopy: (000) 000-0000
or in any case, to such other address as the party addressed shall have
previously designated by written notice to the serving party, given in
accordance with this Section 18.
19. Governing Law; Choice of Forum; Service of Process; Jury Trial
Waiver.
(a) The validity, interpretation and enforcement of this
Agreement and any dispute arising out of the relationship between the
parties hereto, whether in contract, tort, equity or otherwise, shall be
governed by the internal laws of the State of California (without giving
effect to principles of conflicts of law).
(b) Each party hereto irrevocably consents and submits to the
non-exclusive jurisdiction of the state courts of the County of Los Angeles
and the United States District Court for the Central District of California
and waives any objection based on venue or forum non conveniens with
respect to any action instituted therein arising under this Agreement or in
any way connected with or related or incidental to the dealings of the
parties hereto in respect of this Agreement or the transactions related
hereto or thereto, in each case whether now existing or hereafter arising,
and whether in contract, tort, equity or otherwise, and agrees that any
dispute with respect to any such matters shall be heard only in the courts
described above.
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(c) EACH PARTY HERETO HEREBY WAIVES ANY RIGHT TO TRIAL BY JURY
OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION (1) ARISING UNDER THIS
AGREEMENT OR (2) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE
DEALINGS OF THE PARTIES HERETO IN RESPECT OF THIS AGREEMENT OR THE
TRANSACTIONS RELATED HERETO IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER
ARISING, AND WHETHER IN CONTRACT, TORT, EQUITY OR OTHERWISE. EACH PARTY
HEREBY AGREES AND CONSENTS THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF
ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY AND THAT ANY PARTY
MAY FILE AN ORIGINAL COUNTERPART OF A COPY OF THIS AGREEMENT WITH ANY COURT
AS WRITTEN EVIDENCE OF THE CONSENT OF THE PARTIES HERETO TO THE WAIVER OF
THEIR RIGHT TO TRIAL BY JURY.
20. 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.
* * *
10
IN WITNESS WHEREOF, each Subordinated Creditor, the Borrower and Agent have
caused this Subordination and Intercreditor Agreement to be executed as of the
date first written above.
Subordinated Creditor: Subordinated Creditor:
--------------------- ---------------------
Libra Mezzanine Partners II, L.P., Libra Mezzanine Partners, L.P.,
a Delaware limited partnership, a Delaware limited partnership
By: LUSB, L.L.C., General Partner By: LFM, LLC, its General Partner
By: LIBRA INVESTORS III, L.L.C., By: Libra Investors, LLC,
its Managing Member its Managing Member
By: /s/ Xxxxxxx X. Xxxx By: /s/ Xxxxxxx X. Xxxx
Xxxxxxx X. Xxxx Xxxxxxx X. Xxxx
Managing Director Managing Director
Subordinated Creditor: Subordinated Creditor:
--------------------- ---------------------
Rocky Mountain Mezzanine Fund II, L.P., Libra Capital Partners, L.P.,
a Colorado limited partnership a Delaware limited partnership,
By: LFE, LLC,
By: Rocky Mountain Capital Partners LLP, its general partner
its general partner
By: Libra Investors II, LLC,
By: /s/ Xxxxxx X. Xxxxx its managing member
Xxxxxx X. Xxxxx
Managing Partner By: /s/ Xxxxx X. Xxxxxxxx
Xxxxx X. Xxxxxxxx
President
Subordinated Creditor and Subordinated Agent: Agent:
-------------------------------------------- -----
Libra Mezzanine Partners II-A, L.P., Mellon Bank, N.A.,
a Delaware limited partnership, a United States banking corporation,
as Agent
By: Libra Investors III-A, LLC,
its general partner By: /s/ Xxxxxxx XxXxxxx
Xxxxxxx XxXxxxx
By: /s/ Xxxxxxx X. Xxxx Vice President
Xxxxxxx X. Xxxx
Managing Director
Borrower:
--------
Emergent Information Technologies, Inc.,
a California corporation
By: /s/ Xxxxxx Xxxxx
Xxxxxx Xxxxx
Chairman
