EXHIBIT 10.13
SUBORDINATION AGREEMENT
This Subordination Agreement (this "Agreement") is made as of this 28th
day of July, 2005, among U.S. Bank National Association as collateral agent (the
"Collateral Agent") for the Senior Creditors (as defined below), the
subordinated creditors signatory hereto (together with their successors and
assigns, collectively, the "Subordinated Creditors"), ARTISTdirect, Inc., a
Delaware corporation (the "Company"), and the subsidiaries of the Company party
hereto.
PRELIMINARY STATEMENTS
A. The Company has entered into that certain Note and Warrant Purchase
Agreement dated as of July 28, 2005 (as may be amended, restated, supplemented
or otherwise modified from time to time, and any replacement or refinancing
thereof, the "Note and Warrant Purchase Agreement," and together with the other
Transaction Documents and all other documents or instruments executed in
connection therewith, as each may from time to time be amended, modified,
extended, renewed or restated, but for purposes hereof excluding the warrants to
be issued pursuant thereto, collectively the "Senior Documents") by and among
the Company, the investors listed on the signature pages thereto (collectively,
the "Initial Purchasers," and together with any subsequent holders of the Notes,
the "Holders") and the Collateral Agent and the other Transaction Documents (as
defined in the Note and Warrant Purchase Agreement), whereby the Initial
Purchasers have purchased from the Company senior secured notes in aggregate
principal amount of $15,000,000 (as from time to time amended, modified,
extended, renewed, collectively, the "Notes"), which Notes and other obligations
of the Company and its subsidiaries under the Transaction Documents are secured
by certain assignments of and security interests in the assets of the Company
and its Subsidiaries, now or hereafter existing, all as more fully set forth in
the Transaction Documents.
B. The Company has issued one or more promissory note(s) (individually
and/or collectively, the "Subordinated Notes") and warrant(s) (individually and
collectively, the "Subordinated Warrants") and has incurred certain other
indebtedness and payment obligations to Subordinated Creditors under that
certain Securities Purchase Agreement, dated as of the date hereof (as may be
amended, restated, supplemented or otherwise modified from time to time, and any
replacement or refinancing thereof, in each case in accordance with the terms of
this Agreement, the "Securities Purchase Agreement," and together with the
Subordinated Notes, the Subordinated Warrants, and all other documents or
instruments executed in connection therewith, as each may from time to time be
amended, modified, extended, renewed or restated, collectively the "Subordinated
Documents").
C. As set forth in Section 19 hereof, the Subordinated Creditors will
benefit from the execution and delivery of the Note and Warrant Purchase
Agreement and the other Transaction Documents and the issuance of the Notes.
D. As a condition to the obligation of the Initial Purchasers to purchase
the Notes, the Subordinated Creditors are required to enter into this Agreement
and other subordination agreements in substantially the form of this Agreement
(all such other subordination agreements, the "Other Subordination Agreements")
to establish the priority of the repayment of the debt of the Company and its
Subsidiaries, and to address certain related matters.
E. The Subordinated Creditors, the Company and its Subsidiaries desire to
enter into this Agreement in order to induce the Initial Purchasers and the
other Holders to enter into the Note and Warrant Purchase Agreement with Company
and to purchase and hold the Notes.
NOW, THEREFORE, for good and valuable consideration, the sufficiency of
which is hereby acknowledged, the parties agree as follows:
1. Definitions. Except as otherwise provided herein, all capitalized terms
used in this Agreement shall have the meanings ascribed to such terms in the
Note and Warrant Purchase Agreement, provided that the following terms shall
have the meanings set forth below:
"Bankruptcy Code" means Chapter 11 of the United States Bankruptcy Code
(11 U.S.C. Section 101 et seq.
"Company's Property" means all assets, property and property rights, of
any kind or nature, tangible or intangible, now or hereafter existing, in which
the Company owns, asserts or maintains an interest.
"Finally Paid" or "Final Payment," when used in connection with the Senior
Indebtedness shall mean the full, final and indefeasible payment in cash of all
of the Senior Indebtedness and the termination of the Senior Documents.
"Interest Shares" shall have the meaning provided in the Subordinated
Documents.
"Insolvency Proceeding" shall mean any proceeding commenced by or against
any Person under any provision of the Bankruptcy Code, or under any other
bankruptcy or insolvency law, including assignments for the benefit of
creditors, formal or informal moratoria, compositions, extensions generally with
its creditors, or proceedings seeking reorganization, arrangement, or other
similar relief.
"Liens" shall mean any mortgage, deed of trust, pledge, lien, security
interest, charge, set-off right or other encumbrance, whether now existing or
hereafter created, acquired or arising.
"Senior Creditors" means, collectively, the Collateral Agent and all of
the Holders, and "Senior Creditor" means, individually, any of the Senior
Creditors.
"Senior Documents" has the meaning set forth in Recital A.
"Senior Indebtedness" means all indebtedness of the Company and the
Subsidiaries to the Senior Creditors pursuant to the Senior Documents and all
present and future loans, advances, debts, liabilities, indebtedness
obligations, claims and causes of action, otherwise owing to or arising in favor
of any Senior Creditor in respect of the Company or any Subsidiary, whether
evidenced by any note, or other instrument or document, whether absolute or
contingent, due or to become due, including, without limitation, all interest,
charges, expenses, fees, attorneys' fees and any other sums chargeable to the
Company or any Subsidiary; provided that the principal amount of the Senior
Indebtedness shall not exceed $18,000,000. Senior Indebtedness shall include,
without limitation, interest which accrues on the principal amount of the Senior
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Indebtedness subsequent to the commencement of a case under Chapter 11 of the
Bankruptcy Code.
"Subordinated Indebtedness" means all indebtedness of the Company and the
Subsidiaries to the Subordinated Creditors pursuant to the Subordinated
Documents and all present and future loans, advances, debts, liabilities,
indebtedness obligations, claims and causes of action, otherwise owing to or
arising in favor of any Subordinated Creditor in respect of the Company or any
Subsidiary, whether evidenced by any note, or other instrument or document,
whether absolute or contingent, due or to become due, including, without
limitation, all interest, charges, expenses, fees, attorneys' fees and any other
sums chargeable to the Company or any Subsidiary. Subordinated Indebtedness
shall include, without limitation, interest which accrues on the principal
amount of the Subordinated Indebtedness subsequent to the commencement of a case
under Chapter 11 of the Bankruptcy Code.
"Subordinated Creditor Remedies" means any action which results in (a) the
sale, foreclosure, realization on or liquidation of any Company's Property or
any Subsidiaries' Property, (b) the execution on any judgment obtained against
the Company or any Subsidiary, (c) the acceleration of the Subordinated
Indebtedness, (d) the filing of any petition or lien under any bankruptcy,
insolvency or creditors' rights laws with respect to the Company or any
Subsidiary, or (e) the institution or exercise against the Company or any
Subsidiary of any suit, legal action, arbitration or other enforcement remedy.
"Subsidiaries' Property" means all assets, property and property rights,
of any kind or nature, tangible or intangible, now or hereafter existing, in
which the Subsidiaries own, assert or maintain an interest.
"Subsidiary" means any corporation, partnership, joint venture, limited
liability company, trust or estate of which (or in which) more than 50% of (a)
the issued and outstanding capital stock having ordinary voting power to elect a
majority of the Board of Directors of such corporation (irrespective of whether
at the time capital stock of any other class or classes of such corporation
shall or might have voting power upon the occurrence of any contingency), (b)
the interest in the capital or profits of such partnership, joint venture or
limited liability company or (c) the beneficial interest in such trust or estate
is at the time directly or indirectly owned or controlled by the Company, by the
Company and one or more of its other Subsidiaries or by one or more of the
Company's other Subsidiaries. "Subsidiaries" means, collectively, all of the
Subsidiaries.
"UCC" shall mean Article 9 of the Uniform Commercial Code, as in effect in
the State of New York from time to time.
2. Subordination. The Subordinated Creditors hereby subordinate in right
of payment all of the Subordinated Indebtedness owed to the Subordinated
Creditors to the Final Payment of all of the Senior Indebtedness. The
Subordinated Creditors do not, as of the date hereof, hold any Liens or security
interests in Company's Property or in Subsidiaries' Property and hereby agrees
that any Liens, security interests, claims and rights of any kind the
Subordinated Creditors may hereafter acquire against the Company, any
Subsidiary, any Company's Property or any Subsidiaries' Property (which the
Subordinated Creditors will not do
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without the prior written consent of Collateral Agent) shall be subordinate and
subject to the Liens, security interests, claims and rights against the Company,
any Subsidiary, any Company's Property or any Subsidiaries' Property of Senior
Creditors arising from or out of the Senior Indebtedness, regardless of the
order or time as of which any Liens attach to any Company's Property or any
Subsidiaries' Property, the order or time of UCC filings or any other filings or
recordings, the order or time of granting of any such Liens, or the physical
possession of any Company's Property or any Subsidiaries' Property until this
Agreement is terminated in accordance with Section 26 hereof. If the Company or
any Subsidiary issues any instrument or document evidencing the Subordinated
Indebtedness each such instrument and document shall bear a conspicuous legend,
substantially in the form of Exhibit A attached hereto, that it is subordinated
to the Senior Indebtedness in accordance with the terms of this Agreement. The
books of the Company and the Subsidiaries shall be marked to evidence the
subordination of all of the Subordinated Indebtedness to the holders of the
Senior Indebtedness, in accordance with the terms of this Agreement. The
Collateral Agent and each of the other Senior Creditors are authorized to
examine such books from time to time and to make any notations required by this
Agreement. In addition, if, at the request of the Company or any Subsidiary or
in connection with any enforcement action, the Collateral Agent, on behalf of
the Senior Creditors, releases any of its security for any of the obligations of
the Senior Indebtedness which constitute part or all of the security for the
Subordinated Indebtedness, each Subordinated Creditor shall thereupon execute
and deliver to the Collateral Agent such termination statements and releases as
the Collateral Agent shall reasonably request to release each Subordinated
Creditor's security interest in or lien against such property of the Company or
the applicable Subsidiary.
3. Warranties and Representations of the Company, the Subsidiaries and the
Subordinated Creditors. The Company, the Subsidiaries and the Subordinated
Creditors each hereby severally represents and warrants to the Senior Creditors
that the Senior Creditors have been furnished with a true and correct copy of
all instruments and securities evidencing or pertaining to the Subordinated
Indebtedness. The Company and each of the Subsidiaries hereby represents and
warrants to the Senior Creditors that this Agreement has been duly executed and
delivered by the Company and each of the Subsidiaries and constitutes a legal,
valid and binding obligation of the Company and each of the Subsidiaries
enforceable against each of them in accordance with its terms except to the
extent that the enforceability thereof may be limited by any applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws from time to
time in effect affecting generally the enforcement of creditors' rights and
remedies and general principles of equity. Each Subordinated Creditor represents
and warrants as to itself only to the Senior Creditors that: (a) this Agreement
has been duly executed and delivered by such Subordinated Creditor and
constitutes a legal, valid and binding obligation of such Subordinated Creditor
enforceable against such Subordinated Creditor in accordance with its terms,
except to the extent that the enforceability thereof may be limited by any
applicable bankruptcy, insolvency, reorganization, moratorium or similar laws
from time to time in effect affecting generally the enforcement of creditors'
rights and remedies and general principles of equity; (b) such Subordinated
Creditor is acquiring the Subordinated Indebtedness for its own account and not
with a view towards, or for resale in connection with, the public sale or
distribution thereof, except pursuant to sales registered or exempted under the
Securities Act of 1933, as amended; provided, however, that by making the
foregoing representation, such Subordinated Creditor does not agree to hold any
of the Subordinated Indebtedness, or securities received upon conversion
thereof, for any minimum or other specific term and reserves the right to
dispose of
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such Senior Indebtedness at any time in accordance with or pursuant to
applicable law; and (c) such Subordinated Creditor has not relied and shall not
rely on any representation or information of any nature made by or received from
Senior Creditors relative to the Company or any Subsidiaries in deciding to
execute this Agreement or to permit it to continue in effect.
4. Negative Covenants. Until all of the Senior Indebtedness has been
Finally Paid: (a) except for any conversion of Subordinated Indebtedness or
payment of interest on the Subordinated Indebtedness in Interest Shares as
described in Section 6(d), neither the Company nor any Subsidiary shall,
directly or indirectly, grant a security interest in, mortgage, pledge, assign
or transfer any properties, to secure or satisfy all or any part of the
Subordinated Indebtedness; (b) the Subordinated Creditors shall not demand or
accept any collateral from the Company or any Subsidiary; (c) neither the
Company nor any Subsidiary shall discharge the Subordinated Indebtedness other
than in accordance with its terms; (d) the Subordinated Creditors shall not
demand or accept from the Company, any Subsidiary or any other person any
consideration which would result in a discharge of the Subordinated Indebtedness
other than in accordance with its terms; (e) the Subordinated Creditors shall
not transfer or assign any of the Subordinated Indebtedness to any person,
unless each transferee or assignee shall have agreed in writing to be bound by
the terms of this Agreement as a Subordinated Creditor hereunder; (f) neither
the Company nor any Subsidiary shall hereafter issue any instrument, security or
other writing evidencing any part of the Subordinated Indebtedness, and the
Subordinated Creditors shall not receive any such writing, except upon the
condition that such security shall bear the legend referred to in Section 2
above and a true copy thereof shall be furnished to the Collateral Agent; and
(g) neither the Company, any Subsidiary nor the Subordinated Creditors otherwise
shall take any action contrary to the Senior Creditors' priority position over
the Subordinated Creditors that is created by this Agreement, except with
respect to the exercise by the Subordinated Creditors of the rights granted to
it in this Agreement.
5. Payments of Subordinated Indebtedness. Until all of the Senior
Indebtedness has been Finally Paid, neither the Company nor any Subsidiary shall
make, and the Subordinated Creditors shall not accept, any direct or indirect
payment or prepayment in cash, property or securities, by set-off or otherwise,
with respect to any Subordinated Indebtedness, except that (x) scheduled
payments of interest under the Subordinated Notes may be paid in arrears, and
(y) the Company may pay all attorneys' fees and expenses chargeable to the
Company (I) pursuant to the Securities Purchase Agreement in connection with the
consummation of the transactions contemplated thereby and (II) pursuant to the
registration rights agreement entered into among the Company and the
Subordinated Creditors in connection with the review of a registration statement
filed in connection therewith (any such scheduled payment, an "Allowed Payment")
if, and only to the extent that at the time of any such Allowed Payment: (a) no
payment default which constitutes an "Event of Default" has occurred and is
continuing under the Senior Documents and no Event of Default would result from
the making of such Allowed Payment, (b) no Payment Blockage exists at the time
of such payment and (c) according to the quarterly financial statements
submitted to the Collateral Agent and the Holders by the Company pursuant to the
Note and Warrant Purchase Agreement, the Company will be in compliance with all
financial covenants set forth in Section 7(h) of the Note and Warrant Purchase
Agreement after giving effect to the Allowed Payment. Notwithstanding anything
in this Agreement to the contrary, no provision herein shall at any time (x)
restrict the Company from paying, or the Subordinated Creditors from receiving
and accepting, interest paid in Interest Shares, or (y)
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prohibit conversions of the Subordinated Indebtedness into shares of capital
stock of the Company in accordance with the terms of the Subordinated Documents.
6. Prohibition on Payments.
(a) If either
(x) any payment default constituting an Event of Default under
and as defined in the Note and Warrant Purchase Agreement has
occurred and is continuing (any such Event of Default, a "Payment
Default") or
(y) any other Event of Default under and as defined in the
Note and Warrant Purchase Agreement has occurred and is continuing
(any such Event of Default, a "Non-Payment Default") and a Payment
Blockage exists,
then, except for any conversion of Subordinated Indebtedness or payment of
interest in Interest Shares as described in Section 6(d), no direct or
indirect payment or prepayment in cash, property or securities, by set-off
or otherwise, shall be made or agreed to be made by the Company or any
Subsidiary or, upon delivery to any Subordinated Creditor of written
notice thereof (the "Default Notice") from the Collateral Agent accepted
by such Subordinated Creditor, on account of the principal of, premium or
interest on, or any other obligation in respect of the Subordinated
Indebtedness, and neither the Company nor any Subsidiary shall segregate
or hold in trust money for any such payment or distribution, unless and
until (I) with respect to any payment blockage as a result of a Payment
Default, such Payment Default has been cured or waived by the Senior
Creditors, or (II) with respect to any payment blockage as a result of a
Non-Payment Default, either (x) such Non-Payment Default has been cured or
waived by the Senior Creditors or (y) no Payment Blockage exists and
thereafter the Subordinated Creditors shall be entitled to the payment of
suspended payments of the Subordinated Indebtedness from the Company and
the Subsidiaries, to the extent permitted as an Allowed Payment under
Section 5 hereof, provided that no Event of Default will result from the
making of such payments by the Company or any Subsidiary. Notwithstanding
anything in this Agreement to the contrary, no payment blockage (a
"Payment Blockage") on account of any Non-Payment Default shall continue
in accordance with this Section 6(a) for more than 180 continuous days.
(b) In the event that the Company or any Subsidiary shall make, or
any Subordinated Creditor shall collect, any payment on account of the
principal of, premium or interest on or any other amounts due under the
Subordinated Indebtedness in contravention of this Section 6, such
payments shall be paid over and delivered to the Collateral Agent
immediately upon receipt thereof.
(c) In the event that any failure of the Company or any Subsidiary
to make, or the Subordinated Creditors to receive, any payment with
respect to the Subordinated Indebtedness as a result of the provisions of
this Section 6 shall be deemed a default under the Subordinated Documents,
such event shall not give rise to any right of the
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Subordinated Creditors to exercise any Subordinated Creditor Remedies, any
provision of the Subordinated Documents to the contrary notwithstanding.
(d) Notwithstanding anything in this Agreement to the contrary,
nothing herein shall prohibit conversion of the Subordinated Indebtedness
into shares of capital stock of the Company or payment of interest on the
Subordinated Indebtedness in Interest Shares, in each case in accordance
with the terms of the Subordinated Documents.
7. Forbearance of Legal Remedies. During any period of time that a
Payment Default or a Payment Blockage is in effect, as provided in Section 6(a)
hereof, the Subordinated Creditors shall not exercise any Subordinated Creditor
Remedies or other remedies they may have for a default under the Subordinated
Documents, except as permitted below. Whether or not a Payment Default or
Payment Blockage is then in effect, the Subordinated Creditors may exercise one
or more or all of the following rights and remedies (in each case, subject at
all times to the payment subordination and lien subordination provisions set
forth in this Agreement), but only the following rights and remedies, after
prior written notice to the Collateral Agent and upon the occurrence of any of
the following conditions, including any such occurrence during the effective
period of any Payment Default or Payment Blockage: (x) an Insolvency Proceeding
with respect to the Company or any Subsidiary shall occur, or (y) the Senior
Creditors commence legal proceedings against the Company or any Subsidiary:
(a) accelerate payment of the Subordinated Indebtedness;
(b) commence legal proceedings against the Company and the
Subsidiaries and, if requested by the Collateral Agent, become a
co-plaintiff in any legal proceedings commenced by the Collateral Agent or
any other Senior Creditor, provided, that in no event shall the
Subordinated Creditors be permitted to execute on any judgment obtained
against the Company or any Subsidiary until the Senior Indebtedness shall
have been Finally Paid unless the proceeds of such execution of judgment
are paid to the Collateral Agent for application against the Senior
Indebtedness, and further provided that the Subordinated Creditors shall
not be permitted to execute on any judgment obtained against the Company
or any Subsidiary if the only predicate act above is the acceleration of
payment of the Senior Indebtedness; and
(c) file a proof of claim and otherwise participate in any
Insolvency Proceeding with respect to the Company or any Subsidiary.
Each Subordinated Creditor agrees to provide the Collateral Agent with not less
than ten (10) Business Days prior written notice of its intent to exercise any
legal remedy, which notice may be given during any period of time that a Payment
Default or a Payment Blockage is in effect.
8. Subordinated Indebtedness Subordinated to Prior Payment of All
Senior Indebtedness on Dissolution, Liquidation or Reorganization of the Company
or any Subsidiary. Upon any distribution of assets of the Company or any
Subsidiary in any dissolution, winding up, liquidation or reorganization of the
Company of any Subsidiary (whether in bankruptcy, insolvency or receivership
proceedings or upon an assignment for the benefit of creditors or
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otherwise) tending toward liquidation of the business and assets of the Company
or any Subsidiary:
(a) the holders of all Senior Indebtedness shall first be entitled
to receive payment in full in cash (or to have such payment duly provided
for in a manner previously agreed upon or otherwise satisfactory to them)
of the principal thereof, and premium and interest due thereon, and other
amounts payable comprising such Senior Indebtedness, before the
Subordinated Creditors are entitled to receive any payment on account of
the principal of, premium or interest on or any other amounts due under
the Subordinated Indebtedness; and
(b) any payment or distribution of assets of the Company or any
Subsidiary of any kind or character, whether in cash, property or
securities, to which any Subordinated Creditor would be entitled except
for these provisions, shall be paid by the liquidating trustee or agent or
other person making such payment or distribution directly to the
Collateral Agent, to the extent necessary to make payment in full of all
Senior Indebtedness remaining unpaid, after giving effect to any
concurrent payment or distribution or provision therefor to the holders of
such Senior Indebtedness.
The Company shall give prompt written notice to the Collateral Agent, the other
Senior Creditors and the Subordinated Creditors of any dissolution, winding up,
liquidation or reorganization of the Company or any Subsidiary or any assignment
for the benefit of any of the creditors of the Company or any Subsidiary tending
toward the liquidation of the business and assets of the Company or any
Subsidiary.
9. Obligation of the Company and the Subsidiaries Unconditional.
Nothing contained herein or in the Senior Documents is intended to or shall
impair, as between the Company and the Subsidiaries and the Subordinated
Creditors only, the obligation of the Company and the Subsidiaries, which is
absolute and unconditional, to pay to the holders of the Subordinated
Indebtedness the Subordinated Indebtedness as and when the same shall become due
and payable in accordance with their terms, or to affect the relative rights of
the Subordinated Creditors and creditors of the Company and the Subsidiaries
other than the Senior Creditors.
10. Subordination Rights Not Impaired by Acts or Omissions of the
Company, the Subsidiaries or Holder of Senior Indebtedness. No right of any
present or future holder of any Senior Indebtedness to enforce subordination as
provided herein shall at any time in any way be prejudiced or impaired by any
act or failure to act on the part of the Company or any Subsidiary; by any act
or failure to act, which act or failure is in good faith, by any such holder; by
any act or failure to act by any other holder of the Senior Indebtedness; or by
any noncompliance by the Company or any Subsidiary with the terms hereof,
regardless of any knowledge thereof which any such holder may have or be
otherwise charged with. The Subordinated Creditors shall not be released, nor
shall the Subordinated Creditors' obligations hereunder be in anyway diminished,
by any of the following: (a) the exercise or the failure to exercise by the
Collateral Agent or any other Senior Creditor of any rights or remedies
conferred on it or them under the Senior Documents hereunder or existing at law
or otherwise, or against any Company's Property or Subsidiaries' Property; (b)
the commencement of an action at law or the recovery of a
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judgment at law against Company, any Subsidiary or any other obligor ("Obligor")
for the performance of the Senior Indebtedness and the enforcement thereof
through levy or execution or otherwise; (c) the taking or institution or any
other action or proceeding against the Company, any Subsidiary or any Obligor;
or (d) any delay in taking, pursuing, or exercising any of the foregoing
actions, rights, powers, or remedies (even though requested by the Subordinated
Creditors) by the Collateral Agent, any other Senior Creditor or anyone acting
for any Senior Creditor. Without limiting the generality of the foregoing, and
anything else contained herein to the contrary notwithstanding, any Senior
Creditor, from time to time, without prior notice to or the consent of the
Subordinated Creditors, may take all or any of the following actions without in
any manner affecting or impairing the obligation or liability of the
Subordinated Creditors hereunder: (i) obtain a lien or a security interest in
any property to secure any of the Senior Indebtedness; (ii) obtain the primary
and secondary liability of any party or parties with respect to any of the
Senior Indebtedness; (iii) renew, extend, or otherwise change the time for
payment of the Notes or any installment thereof for any period; (iv) release or
compromise any liability of any nature of any person or entity with respect to
the Senior Indebtedness; (v) exchange, enforce, waive, release, and apply any
Company's Property or Subsidiaries' Property and direct the order or manner of
sale thereof as any Senior Creditor may in its discretion determine; (vi)
enforce their rights hereunder, whether or not any Senior Creditor shall proceed
against any other person or entity; (vii) exercise its rights to consent to any
action or non-action of the Company or any Subsidiary which may violate the
covenants and agreements contained in the Senior Documents, with or without
consideration, on such terms and conditions as may be acceptable to them; or
(viii) exercise any of their rights conferred by the Senior Documents or by law.
11. Authority to Act for the Subordinated Creditor. Until the Senior
Indebtedness has been Finally Paid, in the event an Insolvency Proceeding shall
occur and be continuing, the Subordinated Creditors shall file all claims they
may have against the Company or any Subsidiary, and shall direct the debtor in
possession or trustee in bankruptcy, as appropriate, to pay over to the
Collateral Agent all amounts due to the Subordinated Creditors on account of the
Subordinated Indebtedness until the Senior Indebtedness has been paid in full in
cash. If the Subordinated Creditors fail to file such claims as requested by the
Collateral Agent, the Collateral Agent may file such claims on the Subordinated
Creditors' own behalf. The Subordinated Creditor acknowledges and agrees that so
long as any Senior Indebtedness is owed to the Senior Creditors by Company or
any Subsidiary, the Senior Creditor shall have the right to vote the
Subordinated Creditors' claim in any Insolvency Proceeding, and the Subordinated
Creditors shall execute any and all future documents and/or instruments
requested by the Collateral Agent at any time to further evidence and confirm
such right. Until the Senior Indebtedness has been Finally Paid, in the event an
Insolvency Proceeding shall occur and be continuing, the Subordinated Creditors
hereby (a) expressly consent to the granting by the Company and the Subsidiaries
to any Senior Creditor of senior liens and priorities in connection with any
post-petition financing of the Company or any Subsidiary by any Senior Creditor
and (b) agree that adequate notice of such financing to the Subordinated
Creditors shall have been provided if the Subordinated Creditors received notice
in accordance with Section 18 hereof two (2) business days prior to the entry of
any order approving such cash collateral usage or financing. In the event that
the Subordinated Creditors have or at any time acquire any security for the
Subordinated Indebtedness, the Subordinated Creditors agree not to assert any
right it may have to "adequate protection" of its interest in such security in
any Insolvency Proceeding and agree that they will not seek to have the
automatic stay lifted with respect to such
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security, in each case without the prior written consent of the Collateral
Agent, acting at the direction of the Required Holders. The Subordinated
Creditors waive any claim or defense the Subordinated Creditors may now or
hereafter have arising out of the election by any Senior Creditor in any
Insolvency Proceeding instituted under Chapter 11 of the United States
Bankruptcy Code, of the application of Section 1111(b)(2) of the United States
Bankruptcy Code, and/or any use of cash collateral, any borrowing or any grant
of a security interest under Sections 363 and/or 364 of the United States
Bankruptcy Code by the Company or any Subsidiary, as debtor-in-possession. To
the extent that the Senior Creditors receive payments on, or proceeds of
collateral for, the Senior Indebtedness which are subsequently invalidated,
declared to be fraudulent or preferential, set aside and/or required to be
repaid to a trustee, receiver or any other party under any bankruptcy law, state
or federal law, common law, or equitable cause, then as between the Senior
Creditors and the Subordinated Creditors hereunder, to the extent of such
payment or proceeds received, the Senior Indebtedness, or part thereof, intended
to be satisfied shall be revived and continue in full force and effect as if
such payments or proceeds had not been received by the Senior Creditors.
12. Waivers. The Company, each Subsidiary and each Subordinated Creditor
hereby waive, to the fullest extent permitted by law, any defense based on the
adequacy of a remedy at law which might be asserted as a bar to the remedy of
specific performance of this Agreement in any action brought therefor by the
Senior Creditors. To the fullest extent permitted by law and except as to any
notices specified in this Agreement, notices regarding the intended sale or
disposition of any portion of the Collateral by any Senior Creditor, or any
notice which may not be waived in accordance with the UCC, the Company, each
Subsidiary and each Subordinated Creditor hereby further waive: presentment,
demand, protest, notice of protest, notice of default or dishonor, notice of
payment or nonpayment and any and all other notices and demands of any kind in
connection with all negotiable instruments evidencing all or any portion of the
Senior Indebtedness or the Subordinated Indebtedness to which the Company, any
Subsidiary or any Subordinated Creditor may be a party; prior notice of and
consent to any loans made, extensions granted or other action taken in reliance
thereon; and all other demands and notices of every kind in connection with this
Agreement, the Senior Indebtedness or the Subordinated Indebtedness. The
Subordinated Creditors consent to any release, renewal, extension, compromise or
postponement of the time of payment of the Senior Indebtedness, to any
substitution, exchange or release of collateral therefor, and to the addition or
release of any person primarily or secondarily liable thereon.
13. Indulgences Not Waivers. Neither the failure nor any delay on the part
of any Senior Creditor to exercise any right, remedy, power or privilege
hereunder shall operate as a waiver thereof or give rise to an estoppel, nor be
construed as an agreement to modify the terms of this Agreement, nor shall any
single or partial exercise of any right, remedy, power or privilege with respect
to any occurrence be construed as a waiver of such right, remedy, power or
privilege with respect to any other occurrence. No waiver by a party hereunder
shall be effective unless it is in writing and signed by the party making such
waiver, and then only to the extent specifically stated in such writing.
14. Default. If any material representation or warranty of the Company,
any Subsidiary or any Subordinated Creditor in this Agreement or in any
instrument evidencing, securing or relating to the Senior Indebtedness proves to
have been materially false when made,
10
or, in the event of a material breach by any of the Company, any Subsidiary or
any Subordinated Creditor in the performance of any of the material terms of
this Agreement, or any instrument or agreement evidencing, securing or relating
to the Senior Indebtedness, all of the Senior Indebtedness shall, at the option
of the Senior Creditors, become immediately due and payable without presentment,
demand, protest, or notices of any kind, notwithstanding any time or credit
otherwise allowed. At any time any Subordinated Creditor fails to comply with
any provision of this Agreement that is applicable to such Subordinated
Creditor, the Collateral Agent or any Senior Creditor may demand specific
performance of this Agreement, whether or not the Company or any Subsidiary has
complied with this Agreement, and may exercise any other remedy available at law
or equity.
15. Amendment of the Subordinated Documents. Each Subordinated Creditor
agrees that it will not, without the consent of the Collateral Agent, acting at
the direction of the Required Holders, amend the Subordinated Documents, so as
to modify the financial terms thereof (including, without limitation, the amount
of principal, rate of interest, dividends, fees and prepayment premiums, if
any), extend the maturity thereof, add or change any covenants in a manner
materially more restrictive to the Company or any Subsidiary, or effect any
other modification to the Subordinated Documents, which would be materially
adverse to any Senior Creditor.
16. Amendment to Financial Covenants. The Subordinated Creditors hereby
agree, for the benefit of the Collateral Agent and the Senior Creditors, that it
is the intent of the Subordinated Creditors that each financial covenant and
negative covenant contained in Sections 8(b) and (f) of the Subordinated Notes
shall be no more restrictive than the analogous financial covenant or negative
covenant contained in the Senior Documents. Accordingly, the Subordinated
Creditors hereby agree that if the Senior Creditors agree, in the manner
provided in the Senior Documents, to any modification or amendment of, or to any
waiver of, any financial covenant or any negative covenant contained in the
Senior Documents for which there is an analogous financial covenant or negative
covenant contained in Sections 8(b) or (f) of the Subordinated Notes, then such
modification, amendment or waiver shall also automatically and without any
further action by the Collateral Agent, the Senior Creditors or the Subordinated
Creditors, be applied to and shall be a modification, amendment or waiver of the
analogous financial covenants and negative covenants under the Subordinated
Documents. In addition, the Company agrees that if in connection with any such
modification, amendment or waiver the Company pays the Senior Creditors a fee,
then the Company shall pay to the Subordinated Creditors a fee in an amount
equal to the amount of the fee paid to the Senior Creditors. The Subordinated
Creditors shall not add to, amend or otherwise modify in any respect the
financial covenants or negative covenants contained in the Subordinated
Documents so as to make them more restrictive without the prior written consent
of the Senior Creditors.
17. Inconsistent or Conflicting Provisions. In the event a provision of
the Senior Documents or the Subordinated Documents, is inconsistent or conflicts
with the provisions of this Agreement, the provisions of this Agreement shall
govern and prevail.
18. Notices. Any notices, consents, waivers or other communications
required or permitted to be given under the terms of this Agreement must be in
writing and will be deemed to have been delivered: (i) upon receipt, when
delivered personally; (ii) upon receipt, when sent
11
by facsimile (provided confirmation of transmission is mechanically or
electronically generated and kept on file by the sending party); or (iii) one
Business Day after deposit with an overnight courier service, in each case
properly addressed to each party at its address(es) and/or facsimile number(s)
set forth below its signature, or to such other address as either party shall
specify to the other in writing from time to time. Notwithstanding the
foregoing, notices addressed to the Collateral Agent shall be effective only
upon receipt.
19. Benefit. Each Subordinated Creditor represents and warrants that the
issuance of the Notes will benefit such Subordinated Creditor in that such
Subordinated Creditor is financially interested in the Company and the
Subsidiaries and will benefit from the financial success of the Company and the
Subsidiaries. The Subordinated Creditors acknowledge that the Senior Creditors
would not purchase the Notes but for the execution of this Agreement. Therefore,
the Subordinated Creditors have received good, sufficient and adequate
consideration for the making of this Agreement.
20. Entire Agreement. This Agreement constitutes and expresses the entire
understanding between the parties hereto with respect to the subject matter
hereof, and supersedes all prior and contemporaneous agreements and
understandings, inducements or conditions, whether express or implied, oral or
written. Neither this Agreement nor any portion or provision hereof may be
changed, waived or amended orally or in any manner other than by an agreement in
writing signed by the Collateral Agent and the Subordinated Creditors; provided,
however, any such change, waiver or amendment shall be binding upon the Company
or any Subsidiary by the Company's or such Subsidiary's written consent thereto.
21. Additional Documentation. The Company, the Subsidiaries and the
Subordinated Creditors shall execute and deliver to the Collateral Agent such
further instruments and shall take such further action as any Senior Creditor
may at any time or times reasonably request in order to carry out the provisions
and intent of this Agreement.
22. Expenses. The Company agrees to pay the Collateral Agent and each
other Senior Creditor on demand all expenses of every kind, including reasonable
attorney's fees, that that Collateral Agent or such Senior Creditor, as the case
may be, may incur in enforcing any of its rights against the Company, any
Subsidiary or any Subordinated Creditor under this Agreement. As between the
Senior Creditors and the Subordinated Creditors, the court may, in the exercise
of its discretion, award attorney's fees to a prevailing party, in a manner
consistent with New York law governing actions arising out of a contract, and
the prevailing party shall have the right to petition the court to make such
award.
23. Successors and Assigns. This Agreement shall inure to the benefit of
Senior Creditors and their successors and assigns, and shall be binding upon the
Company, the Subsidiaries and their successors and assigns, and the Subordinated
Creditors and their respective heirs, legatees, distributees, transferees,
executors, administrators and personal representatives and assigns, including
without limitation, any subsequent holders of the Subordinated Notes and/or the
Subordinated Warrants. Any Senior Creditor, without prior notice or consent of
any kind, may sell, assign or transfer all or any portion of the Senior
Indebtedness, and in such event each and every immediate and successive assignee
or transferee thereof may be given the right by a Senior Creditor to enforce
this Agreement in full against the
12
Company, the Subsidiaries and the Subordinated Creditors, by suit or otherwise,
for its own benefit, provided that such successor, assignee or transferee agrees
to be bound by the terms of this Agreement.
24. Covenant Not to Challenge. This Agreement has been negotiated by the
parties with the expectation and in reliance upon the assumption that the
instruments and documents evidencing the Senior Indebtedness are valid and
enforceable. In determining whether to enter into this Agreement, the
Subordinated Creditors have assumed such validity and enforceability, and has
agreed to the provisions contained herein, without relying upon any reservation
of a right to challenge or call into question such validity or enforceability.
As between the Senior Creditors and the Subordinated Creditors, each
Subordinated Creditor hereby covenants and agrees, to the fullest extent
permitted by law, that it shall not initiate in any proceeding a challenge to
the validity or enforceability of the documents and instruments evidencing the
Senior Indebtedness, nor shall any Subordinated Creditor instigate other parties
to raise any such challenges, nor shall any Subordinated Creditor participate in
or otherwise assert any such challenges which are raised by other parties.
25. Subrogation. Subject to the foregoing provisions hereof, provided that
the Senior Indebtedness has been Finally Paid (and shall not be subject to
avoidance under Section 547 of the Bankruptcy Code) the Subordinated Creditors
shall be subrogated, to the extent of such Senior Indebtedness so paid, to the
rights of the holder of such Senior Indebtedness to receive payments or
distributions or assets of the Company and the Subsidiaries that secure such
Senior Indebtedness until all amounts owing on the Subordinated Indebtedness
shall be paid in full. For the purpose of such subrogation no payments or
distributions to the holder of the Senior Indebtedness by or on behalf of the
Company or any Subsidiary or by or on behalf of the Subordinated Creditors by
virtue of the provisions hereof which otherwise would have been made to the
Subordinated Creditors shall, as between the Company and the Subsidiaries, a
creditor of the Company and/or the Subsidiaries (other than the Subordinated
Creditors and the Senior Creditors) and the Subordinated Creditors, be deemed to
be payment by the Company or any Subsidiary to or on account of the Subordinated
Indebtedness, it being understood that the provisions of this Agreement are, and
are intended solely, for the purpose of defining the relative rights of the
Subordinated Creditors on the one hand, and the Senior Creditors on the other
hand. In the event that any Subordinated Creditor turns over to any Senior
Creditor any payment or contributions received by it in accordance with this
Agreement, such Subordinated Creditor shall, for purposes of determining whether
any default under the Subordinated Documents has occurred, be deemed never to
have received such payment or distribution. In the event that the Company or any
Subsidiary fails to make any payment on account of the Subordinated Indebtedness
by reason of any provision contained herein, such failure shall, notwithstanding
such provision contained herein, constitute a default with respect to the
Subordinated Indebtedness if and to the extent such failure would otherwise
constitute such a default in accordance with the terms of the Subordinated
Indebtedness.
26. Termination of Agreement. This Agreement shall continue and shall be
irrevocable until the date all of the Senior Indebtedness has been Finally Paid
by the Company and the Subsidiaries or otherwise discharged and released by the
Senior Creditors.
13
27. Reinstatement. The obligations of the Subordinated Creditors under the
Agreement shall continue to be effective, or be reinstated, as the case may be,
if at any time any payment in respect of any Senior Indebtedness is rescinded or
must otherwise be restored or returned by any Senior Creditor by reason of any
bankruptcy, reorganization, arrangement, composition or similar proceeding or as
a result of the appointment of a receiver, intervenor or conservator of, or
trustee or similar officer for, the Company, any Subsidiary or any substantial
part of their property, or otherwise, all as though such payment had not been
made.
28. Governing Law; Jurisdiction; Jury Trial. All questions concerning the
construction, validity, enforcement and interpretation of this Agreement shall
be governed by the internal laws of the State of New York, without giving effect
to any choice of law or conflict of law provision or rule (whether of the State
of New York or any other jurisdictions) that would cause the application of the
laws of any jurisdictions other than the State of New York. Each party hereby
irrevocably submits to the exclusive jurisdiction of the state and federal
courts sitting in The City of New York, Borough of Manhattan, for the
adjudication of any dispute hereunder or in connection herewith or with any
transaction contemplated hereby or discussed herein, and hereby irrevocably
waives, and agrees not to assert in any suit, action or proceeding, any claim
that it is not personally subject to the jurisdiction of any such court, that
such suit, action or proceeding is brought in an inconvenient forum or that the
venue of such suit, action or proceeding is improper. Each party hereby
irrevocably waives personal service of process and consents to process being
served in any such suit, action or proceeding by mailing a copy thereof by
registered or certified mail, return receipt requested to such party at the
address for such notices to it under this Agreement and agrees that such service
shall constitute good and sufficient service of process and notice thereof.
Nothing contained herein shall be deemed to limit in any way any right to serve
process in any manner permitted by law. EACH PARTY HEREBY IRREVOCABLY WAIVES ANY
RIGHT IT MAY HAVE, AND AGREES NOT TO REQUEST, A JURY TRIAL FOR THE ADJUDICATION
OF ANY DISPUTE HEREUNDER OR IN CONNECTION WITH OR ARISING OUT OF THIS AGREEMENT
OR ANY TRANSACTION CONTEMPLATED HEREBY.
29. Severability. The provisions of this Agreement are independent of and
separable from each other. If any provision hereof shall for any reason be held
invalid or unenforceable, it is the intent of the parties that such invalidity
or unenforceability shall not affect the validity or enforceability of any other
provision hereof, and that this Agreement shall be construed as if such invalid
or unenforceable provision had never been contained herein.
30. Counterparts. This Agreement may be executed in any number of separate
counterparts, all of which, when taken together, shall constitute one and the
same instrument, notwithstanding the fact that all parties did not sign the same
counterpart.
31. Independent Nature of Subordinated Creditors' Obligations and Rights.
The obligations of each Subordinated Creditor under this Agreement are several
and not joint with the obligations of any other Subordinated Creditor, and no
Subordinated Creditor shall be responsible in any way for the performance of the
obligations of any other Subordinated Creditor under this Agreement or any other
instrument, certificate or agreement entered into in connection herewith.
Nothing contained herein or in any other such document, and no action taken by
any Subordinated Creditor pursuant hereto or thereto shall be deemed to
constituted the Subordinated
14
Creditors as a partnership, and association, a joint venture or any other kind
of entity, or create a presumption that the Subordinated Creditors are in any
way acting in concert or as a group with respect to such obligations or the
transactions contemplated hereby or thereby. Each Subordinated Creditor shall be
entitled to independently protect and enforce its rights, including, without
limitation, the rights arising out of this Agreement or out of any other
instrument or agreement entered into in connection herewith, and it shall not be
necessary for any other Subordinated Creditor to be joined as an additional
party in any proceeding for such purpose.
[SIGNATURES PAGES FOLLOW]
15
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
CCM MASTER QUALIFIED FUND LTD.
By: /s/ Xxxxx X. Xxxxxxx
---------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Director
[SEE SCHEDULE 1 FOR NOTICE ADDRESSES]
[SIGNATURE PAGE TO SUBORDINATION AGREEMENT]
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.
SUBORDINATED CREDITORS:
DKR SOUNDSHORE OASIS HOLDING FUND LTD.
By: /s/ Xxxx Xxxxxxx
----------------------------
Name: Xxxx Xxxxxxx
Title:
[SEE SCHEDULE 1 FOR NOTICE ADDRESSES]
[SIGNATURE PAGE TO SUBORDINATION AGREEMENT]
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.
SUBORDINATED CREDITORS:
JLF PARTNERS I, LP
By: /s/ Xxxx Xxxxxxxxx
--------------------------------
Name: Xxxx Xxxxxxxxx
Title: CFO
JLF PARTNERS II, LP
By: /s/ Xxxx Xxxxxxxxx
--------------------------------
Name: Xxxx Xxxxxxxxx
Title: CFO
JLF OFFSHORE FUND, LTD.
By: /s/ Xxxx Xxxxxxxxx
--------------------------------
Name: Xxxx Xxxxxxxxx
Title: CFO
[SEE SCHEDULE 1 FOR NOTICE ADDRESSES]
[SIGNATURE PAGE TO SUBORDINATION AGREEMENT]
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.
SUBORDINATED CREDITORS:
XXXXX XXXX
By: /s/ Xxxxx Xxxx
-----------------------------
Name: Xxxxx Xxxx
Title:
[SEE SCHEDULE 1 FOR NOTICE ADDRESSES]
[SIGNATURE PAGE TO SUBORDINATION AGREEMENT]
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.
SUBORDINATED CREDITORS:
Xxxxxxx Xxxxxxx
By: /s/ Xxxxxxx Xxxxxxx
------------------------------
Name: Xxxxxxx Xxxxxxx
Title:
[SEE SCHEDULE 1 FOR NOTICE ADDRESSES]
[SIGNATURE PAGE TO SUBORDINATION AGREEMENT]
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.
SUBORDINATED CREDITORS:
XXXXXXX XXXX
By: /s/ Xxxxxxx Xxxx
-----------------------
Name: Xxxxxxx Xxxx
Title:
[SEE SCHEDULE 1 FOR NOTICE ADDRESSES]
[SIGNATURE PAGE TO SUBORDINATION AGREEMENT]
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.
SUBORDINATED CREDITORS:
XXXXXX XXXXXXXXX
By: /s/ Xxxxxx Xxxxxxxxx
-------------------------
Name: Xxxxxx Xxxxxxxxx
Title:
[SEE SCHEDULE 1 FOR NOTICE ADDRESSES]
[SIGNATURE PAGE TO SUBORDINATION AGREEMENT]
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.
SUBORDINATED CREDITORS:
XXXX XXXXXX
By: /s/ Xxxx Xxxxxx
---------------------
Name: Xxxx Xxxxxx
Title:
[SEE SCHEDULE 1 FOR NOTICE ADDRESSES]
[SIGNATURE PAGE TO SUBORDINATION AGREEMENT]
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.
SUBORDINATED CREDITORS:
XXXXXXX XXXXXX
By: /s/ Xxxxxxx Xxxxxx
-------------------------
Name: Xxxxxxx Xxxxxx
Title:
[SEE SCHEDULE 1 FOR NOTICE ADDRESSES]
[SIGNATURE PAGE TO SUBORDINATION AGREEMENT]
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.
SUBORDINATED CREDITORS:
BROADBAND CAPITAL MANAGEMENT LLC
By: /s/ Xxxxxxx Xxxx
----------------------
Name: Xxxxxxx Xxxx
Title:
[SEE SCHEDULE 1 FOR NOTICE ADDRESSES]
[SIGNATURE PAGE TO SUBORDINATION AGREEMENT]
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first above written.
SUBORDINATED CREDITORS:
LONGVIEW FUND, L.P.
By: /s/ Xxxxx Benz
---------------------------------
Name: Xxxxx Benz
Title: Investment Manager
LONGVIEW EQUITY FUND, L.P.
By: /s/ Xxxxx X. Xxxxxxx
---------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Investment Manager
LONGVIEW INTERNATIONAL
EQUITY FUND, L.P.
By: /s/ Xxxxx X. Xxxxxxx
---------------------------------
Name: Xxxxx X. Xxxxxxx
Title: Investment Manager
[SEE SCHEDULE 1 FOR NOTICE ADDRESSES]
[SIGNATURE PAGE TO SUBORDINATION AGREEMENT]
THE COMPANY: ARTISTDIRECT, INC., a Delaware corporation
By: /s/ Xxxxxx X. Xxxxxxxxxx
------------------------------------
Its: Chief Financial Officer
Company's address for notices:
c/o ARTISTdirect, Inc.
00000 Xxxxxxxx Xxxxxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Attn: Xxxxxxxx Xxxxxxx
Facsimile: (000) 000-0000
SUBSIDIARIES: ARTISTDIRECT INTERNET GROUP, INC., a
Delaware corporation
By: /s/ Xxxxxx X. Xxxxxxxxxx
------------------------------------
Its: Chief Financial Officer
Subsidiary's address for notices:
c/o ARTISTdirect, Inc.
00000 Xxxxxxxx Xxxxxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Attn: Xxxxxxxx Xxxxxxx
Facsimile: (000) 000-0000
ARTISTDIRECT DIGITAL, INC., a
Delaware corporation
By: /s/ Xxxxxx X. Xxxxxxxxxx
------------------------------------
Its: Chief Financial Officer
Subsidiary's address for notices:
c/o ARTISTdirect, Inc.
00000 Xxxxxxxx Xxxxxxxxx, Xxxxx 0000
Xxx Xxxxxxx, XX 00000
Attn: Xxxxxxxx Xxxxxxx
Facsimile: (000) 000-0000
[SIGNATURE PAGE TO SUBORDINATION AGREEMENT]
MEDIADEFENDER, INC., a Delaware corporation
By: /s/ Xxxxxxx Xxxxxxx
-------------------------------
Its: CFO
Subsidiary's address for notices:
MediaDefender, Inc.
0000 Xxxxxxx Xxxxxx
Xxxxxx Xxx Xxx, XX 00000
Attn: Xxxxx Xxxx
Facsimile: (000) 000-0000
COLLATERAL AGENT: U.S. BANK NATIONAL ASSOCIATION
By: /s/ Xxxx X. Xxxxxxxxxx
-------------------------------
Its: Vice President
Address for Notices:
U.S. Bank National Association
000 Xxxx Xxxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Attention: Corporate Trust Services
(ARTISTdirect, Inc. 2005 Subordination
Agreement)
Facsimile: (000) 000-0000
[SIGNATURE PAGE TO SUBORDINATION AGREEMENT]
LEGEND TO BE INSERTED
AT THE TOP OF EACH
SUBORDINATED NOTE
ALL INDEBTEDNESS EVIDENCED HEREBY AND REFERENCED HEREIN IS SUBORDINATED TO ALL
SENIOR INDEBTEDNESS OWED TO THE SENIOR CREDITORS AS SET FORTH IN THAT CERTAIN
SUBORDINATION AGREEMENT DATED AS OF JULY 28, 2005, AS AMENDED, RESTATED,
SUPPLEMENTED OR OTHERWISE MODIFIED FROM TIME TO TIME AMONG U.S. BANK NATIONAL
ASSOCIATION AS COLLATERAL AGENT FOR THE SENIOR CREDITORS (AS DEFINED THEREIN),
THE HOLDER OF THIS NOTE AND THE OTHER PARTIES NAMED THEREIN.
SCHEDULE 1
LIST OF SUBORDINATED CREDITORS
ADDRESS AND LEGAL REPRESENTATIVE'S ADDRESS
BUYER FACSIMILE NUMBER AND FACSIMILE NUMBER
------------------------------ ----------------------------------- --------------------------------
DKR SoundShore Oasis Holding 0000 Xxxx Xxxx Xxxxxx, 0xx Xxxxx Xxxxxxx Xxxx & Xxxxx LLP
Fund Ltd. Xxxxxxxx, XX 00000-0000 000 Xxxxx Xxxxxx
Attention: Xxxxxxx Xxxxxx Xxx Xxxx, XX 00000
Facsimile: (000) 000-0000 Attention: Xxxxxxx Xxxxx, Esq.
Telephone: (000) 000-0000 Facsimile: (000) 000-0000
Residence: Bermuda Telephone: (000) 000-0000
CCM Master Qualified Fund Ltd. c/o Coghill Capital Management, LLC Xxxxxx & Xxxxxx LLP
One North Xxxxxx Drive Xxx Xxxxxxx Xxxx Xxxxx
Xxxxx 0000 Xxx Xxxx, XX 00000
Xxxxxxx, XX 00000 Attention: Xxxxx Xxxxxxxxx, Esq.
Attention: Xxx Xxxxxxx Facsimile: (000) 000-0000
Facsimile: (000) 000-0000 Telephone: (000) 000-0000
Telephone: (000) 000-0000
cc:
Achilles Partners, LLC
0000 0xx Xxxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxxx Xxxxxxxx
Facsimile: (000) 000-0000
Telephone:
JLF Partners I, LP c/o JLF Asset Management, LLC Xxxxxx & Xxxxxx LLP
JLF Partners II, LP 0000 Xxx xx xx Xxxxx One Battery Park Plaza
JLF Offshore Fund, Ltd. Xxxxx 000 Xxx Xxxx, XX 00000
Xxx Xxx, XX 00000 Attention: Xxxxx Xxxx, Esq.
Attention: Xxxxxxx Xxxxxxxx Facsimile: (000) 000-0000
Telephone: (000) 000-0000 Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Xxxxx Xxxx 00000 Xxxxxxx Xxx. O'Melveny & Xxxxx LLP
#000 Xxxxxx xxx Xxx, XX 00000 000 Xxxxx Xxxx Xxxxxx
tel. (000) 000-0000 Xxx Xxxxxxx, Xxxxxxxxxx 00000
fax. (000) 000-0000 Attention: Xxxx Xxxxxx, Esq.
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
Xxxxxxx Xxxxxxx 00000 Xxxxxxx Xxx. O'Melveny & Xxxxx LLP
#000 Xxxxxx xxx Xxx, XX 00000 000 Xxxxx Xxxx Xxxxxx
tel. (000) 000-0000 Xxx Xxxxxxx, Xxxxxxxxxx 00000
fax. (000) 000-0000 Attention: Xxxx Xxxxxx, Esq.
Facsimile: (000) 000-0000
Telephone: (000) 000-0000
Xxxxxxx Xxxx 00 Xxxxx Xxxxxx Xxxx
Xxx. 0X
Xxx Xxxx, XX 00000
Xxxxxx Xxxxxxxxx 000 Xxxx 00xx Xxxxxx
Xxx. 0X
Xxx Xxxx, XX 00000
Xxxx Xxxxxx 00 Xxxxxx Xxxxxx
Xxxxxxx, XX 00000
Xxxxxxx Xxxxxx 000 Xxxx 00xx Xxxxxx
Xxx. 000
Xxx Xxxx, XX 00000
Broadband Capital Management 000 Xxxxx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxxxxx Xxxx
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
Longview Fund, L.P. Viking Asset Management, LLC Grushko & Xxxxxxx, P.C.
Longview Equity Fund, L.P. Longview Family of Funds 000 Xxxxx Xxxxxx - Xxxxx 0000
Longview Int'l Equity Fund, L.P. 000 Xxxxxxxxxx Xxxxxx, 00xx Xx. Xxx Xxxx XX 00000
Transamerica Pyramid Attention: Xxxxxx X. Xxxxxxx, Esq.
Xxx Xxxxxxxxx, XX 00000 Facsimile: (000) 000-0000
Attention: Xxxxxxx Xxxxxxx, President Telephone: (000) 000-0000
Telephone: (000) 000-0000
Facsimile: (000) 000-0000
