4.23 SUBORDINATION AGREEMENT BETWEEN XXXXX X. XXXXX AND XXXXX BROTHERS XXXXXXXX
& CO. AND STATE STREET BANK & TRUST COMPANY ("LENDERS") DATED DECEMBER 21,
1998.
SUBORDINATION AGREEMENT
This AGREEMENT entered into at Boston, Massachusetts, as of December
21, 1998, among Xxxxx X. Xxxxx, with an address of c/o SeraCare, Inc., 0000
Xxxxxxx Xxxx Xxxx, Xxxxx 0000, Xxx Xxxxxxx, Xxxxxxxxxx 00000 (the "Creditor"),
Xxxxx Brothers Xxxxxxxx & Co., with an address of 00 Xxxxx Xxxxxx, Xxxxxx,
Xxxxxxxxxxxxx 00000 ("BBH"), State Street Bank and Trust Company, with an
address of 000 Xxxxxxxx Xxxxxx, Xxxxxx, Xxxxxxxxxxxxx 00000 ("State Street")
(BBH and State Street are hereinafter collectively referred to as the "Lenders"
and sometimes individually as a "Lender"), and Xxxxx Brothers Xxxxxxxx & Co. as
Administrative Agent for the Lenders (the "Administrative Agent").
For valuable consideration, receipt whereof is hereby acknowledged,
and in consideration of the loans, advances, discounts, renewals or extensions
now or hereafter made each by Lenders to or for the account of SeraCare, Inc.
(hereinafter called the "Borrower"), the Creditor hereby agrees with the Lenders
and the Administrative Agent as follows:
1. Creditor represents to the Lenders and the Administrative Agent that
the Borrower now owes Creditor the principal amount of $472,500 together with
accrued and unpaid interest, fees and expenses (the "Plost Indebtedness") and
that the Plost Indebtedness has not been assigned to or subordinated in favor of
any other person or entity and that Creditor holds no security therefor.
Creditor further represents that the Plost Indebtedness is not represented by
any notes or other negotiable instruments, except (a) that certain promissory
note in the original principal amount of $400,000, dated as of July 2, 1996, (b)
that certain promissory note in the original principal amount of $150,000, dated
as of May 5, 1997, and (c) that certain promissory note in the original
principal amount of $125,000, dated as of May 19, 1997 (collectively, the "Plost
Notes") by the Borrower in favor of the Creditor. Creditor and, by its
acknowledgment and agreement below, Borrower, agree that if at any time the
Plost Indebtedness is evidenced by any notes, debentures, or instruments other
than the Plost Notes, Creditor and Borrower shall cause each of such notes,
debentures, or instruments to contain a legend indicating that such note,
debenture or instrument, as the case may be, is subordinate to the obligations
owing by Borrower to the Lenders.
2. Creditor hereby subordinates the Plost Indebtedness and any and all
other present and future indebtedness of the Borrower to Creditor (collectively,
the "Creditor Indebtedness") to any and all indebtedness now or hereafter owing
by the Borrower to the Lenders (collectively, the "Lender Indebtedness") and
agrees not to demand, accept or receive any payment of principal or interest
upon account of the Creditor Indebtedness or any collateral therefor, until all
Lender Indebtedness has been paid in full, except for regularly scheduled
payments of interest respecting the Creditor Indebtedness, provided there is no
existing event of default continuing under the Lender Indebtedness before or as
a consequence of such payment. Creditor will not commence or join with any other
creditor or creditors of Borrower in commencing any bankruptcy, reorganization
or insolvency proceedings against Borrower. Creditor also subordinates any
claims that Creditor might assert against any guarantor of the Creditor
Indebtedness to any and all claims assertable by the Lenders (whether through
the Administrative Agent or otherwise) against guarantors of the Lender
Indebtedness.
3. Subject to the Lenders' priority of liens in the Lenders' collateral
securing the Lender Indebtedness, nothing in this Agreement shall prohibit
Creditor from taking action (except to commence or join with any other creditor
or creditors of Borrower in commencing any bankruptcy, reorganization or
insolvency proceedings against Borrower) to enforce his rights under the
Creditor Indebtedness after expiration of the Standstill Period (as hereinafter
defined) so long as there continues to be an existing uncured event of default
involving the payment of money under the Creditor Indebtedness. "Standstill
Period" shall mean the period of time commencing with the date on which the
Administrative Agent notifies the Creditor that an event of default has occurred
under the Lender Indebtedness, provided that such event of default has not been
cured or waived, and expiring one hundred and eighty (180) days after such date.
If, during the Standstill Period, the default under the Lender Indebtedness is
cured or waived, the Standstill Period shall cease running, and a new Standstill
Period shall commence running when the Administrative Agent gives notice to
Creditor that an additional event of default has occurred under the Lender
Indebtedness. The Standstill Period shall be tolled during any period of time
that there is in effect an automatic stay under the Bankruptcy Code or an
injunction or restraining order issued by a court prohibiting Lenders or the
Administrative Agent from exercising their remedies, until a court of competent
jurisdiction has lifted such stay, injunction, or restraint.
4. Should any payment be received by Creditor for or on account of any of
the Creditor Indebtedness in contravention of this Agreement, prior to the
satisfaction of all Lender Indebtedness, Creditor will forthwith deliver the
same to the Administrative Agent, in precisely the form received (except for
Creditor's endorsement where necessary) for application on account of the
Borrower's obligations to the Lenders and, until so delivered, the same shall be
held in trust by Creditor as the property of the Lenders.
5. In order to carry out the terms and the intent of this Agreement more
effectively, Creditor will do all acts and execute all further instruments in
each case as may be reasonably requested by the Lenders and the Administrative
Agent as necessary or convenient to preserve for the Lenders and the
Administrative Agent the benefit of this Agreement.
6. Creditor further waives presentment, notice and protest in connection
with all negotiable instruments evidencing the indebtedness subordinated hereby
or Borrower's indebtedness to Lenders, notice of the acceptance of this
Agreement by Lenders and the Administrative Agent, notice of any loan made,
extension granted or other action taken in reliance hereon and all demands and
notices of every kind in connection with this Agreement, or the indebtedness of
Borrower to Lenders or to Creditor, assents to any renewal, extension or
postponement of the time of payment of the Lender Indebtedness or any other
indulgence with respect thereto, to any substitution, exchange or release of
collateral therefor and to the addition or release of any person primarily or
secondarily liable thereon; and agrees to the provisions of any instrument,
security or other writing evidencing the Lender Indebtedness. No action which
the Lenders or the Administrative Agent, or the Borrower with the consent of the
Lenders, may take or refrain from taking with respect to any Lender
Indebtedness, or any note or notes representing the same, or any collateral
therefor, including a waiver or release thereof or any agreement or agreements
(including guaranties) in connection therewith, shall affect this Agreement or
the obligations of Creditor hereunder. If all Lender Indebtedness is at any time
hereafter paid in full and thereafter Borrower again becomes indebted to the
Lenders, the provisions of this Agreement shall apply to said new indebtedness
unless, before the same is incurred, Creditor notifies the Administrative Agent
in writing of the cancellation of this Agreement.
7. No waiver shall be deemed to be made by any Lender or the
Administrative Agent of any of its rights hereunder unless the same shall be
in writing and shall be a waiver only with respect to the specific instance
involved unless otherwise provided for in such waiver; and it shall in no way
impair any Lender's or the Administrative Agent's rights or Creditor's
obligations to it in any other respect or any other time. This Agreement
incorporates all discussions and negotiations between Creditor and Lenders
and the Administrative Agent concerning the subordination provided by
Creditor hereby, and no such discussions or negotiations shall limit, modify
or otherwise affect the provisions hereof, and no provision hereof may be
altered, amended, waived, canceled or modified, and this Agreement may not be
terminated, except by a written instrument executed and delivered by a duly
authorized officer of each Lender.
8. The rights granted to the Lenders and the Administrative Agent
hereunder are solely for their protection and nothing herein contained shall
impose on any Lender or the Administrative Agent any
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duties with respect to any property of the Borrower or Creditor received
hereunder, beyond reasonable care in its custody and preservation while in the
Lenders' or the Administrative Agent's possession. The Lenders and the
Administrative Agent shall have no duty to preserve rights against prior parties
in any instrument or chattel paper received hereunder or pursuant to this
Agreement.
9. This Agreement shall bind Creditor and Creditor's heirs, successors,
assigns and legal representatives and shall inure to the benefit of the Lenders
and the Administrative Agent and their successors and assigns, and shall be
governed by and construed in conformity with the laws of the Commonwealth of
Massachusetts.
[INTENTIONALLY LEFT BLANK]
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EXECUTED under seal as of the date first above written.
Witness: Creditor:
/s/ Xxxxx X. Xxxxxxx /s/ Xxxxx Xxxxx
------------------------------ ------------------------------
Xxxxx X. Xxxxx
ACCEPTED:
XXXXX BROTHERS XXXXXXXX & CO.
By: [Illegible]
--------------------------
Xxxxxx X. Xxxx, Deputy Manager
STATE STREET BANK AND TRUST COMPANY
By: /s/ [Illegible]
--------------------------
Name: [Illegible]
Title: XX
XXXXX BROTHERS XXXXXXXX & CO. AS ADMINISTRATIVE AGENT
By: /s/ Xxxxxx X. Xxxx
--------------------------
Xxxxxx X. Xxxx, Deputy Manager
The Borrower above named hereby acknowledges notice of the within and foregoing
subordination and agrees to be bound by all the terms, provisions and conditions
thereof.
Witness: Borrower:
SeraCare, Inc.
By: /s/ Xxxxx Xxxxx
----------------------------------
Xxxxx X. Xxxxx, Chairman and CEO
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