EXHIBIT 10.76
SUBORDINATION AGREEMENT
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Dated: August 13, 1999
To: First Union National Bank, as Agent ("Agent") for
the Lenders and Issuing Bank named in the Loan
Agreement defined below (collectively "Lenders")
To induce the Lenders to establish and continue a credit facility for
making loans and extending credit from time to time for the joint and several
benefit of Capital Associates, Inc. and Capital Associates International, Inc.
(collectively, "Borrowers" and each a "Borrower") from time to time pursuant to
the terms of that certain Loan and Security Agreement among Borrowers, Lenders,
Sureties (as defined in the Loan Agreement) and Agent, dated as of November 26,
1997 (as has been and may hereafter be amended, supplemented or replaced from
time to time, the "Loan Agreement"), the undersigned intending to be legally
bound, hereby agrees as follows:
1. The payment of any and all Officer Subordinated Debt is expressly
subordinated to the Senior Debt to the extent and in the manner set forth in
this Subordination Agreement. The term "Officer Subordinated Debt" means the
principal of and interest on all indebtedness, liabilities, and obligations of
Borrowers, or either of them, now existing or hereafter arising, to the
undersigned pursuant to or in connection with the indebtedness of Borrowers, or
either of them, evidenced by that certain Senior Subordinated Unsecured Note
dated as of August 13, 1999 (as amended, replaced and/or substituted from time
to time, "Note"), payable to the order of the undersigned in the original
principal amount of $175,000.00. The term "Senior Debt" means any and all
Obligations (as defined in the Loan Agreement) of Borrowers to Agent and/or
Lenders under the Loan Agreement.
2. Until the Senior Debt is paid in full, Borrowers shall not pay, and
undersigned shall not accept, any payments of principal and interest (including
prepayments) associated with Officer Subordinated Debt, except that payments may
be made on the Officer Subordinated Debt before the Senior Debt is paid in full
(i) if the payments are made out of the proceeds of any new Subordinated Debt
(as defined in the Loan Agreement) incurred by the Borrowers, or either of them,
in accordance with the provisions of the Loan Agreement or (ii) on a scheduled
payment date which is a date three years after the date hereof.
3. Any payments on the Officer Subordinated Debt received by the
undersigned, other than as permitted in paragraph 2 above, shall be held in
trust for Lenders and the undersigned will forthwith turn over any such payments
in the form received, properly endorsed, to Agent to be applied to the Senior
Debt as determined by Agent.
4. No Borrower shall grant to the undersigned and the undersigned
shall not take any lien on or security interest in any of such Borrower's
property, now owned or hereafter acquired or created, without Agent's prior
written consent.
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5. The undersigned agrees that it will not make any assertion or claim
in any action, suit or proceeding of any nature whatsoever in any way
challenging the priority, validity or effectiveness of the liens and security
interests granted to Agent and/or Lenders under and in connection with the Loan
Agreement, or any amendment, extension, replacement thereof or related
agreement, instrument or document among Lenders and/or Agent and Borrowers or
either of them.
6. The undersigned will not commence any action or proceeding against
Borrowers, or any of them, to recover all or any part of the Officer
Subordinated Debt not paid when due and shall at no time join with any creditor,
in bringing any proceeding against any Borrower under any liquidation,
conservatorship, bankruptcy, reorganization, rearrangement, or other insolvency
law now or hereafter existing, unless and until the Senior Debt shall be paid in
full. Subject to the foregoing, the undersigned may accelerate the amount of the
Officer Subordinated Debt upon the occurrence of (i) the acceleration of the
Senior Debt; and (ii) the filing of a petition under the Bankruptcy Code by any
Borrower.
7. In the event of any liquidation, conservatorship, bankruptcy,
reorganization, rearrangement, or other insolvency proceeding of Borrowers, or
any of them, the undersigned will at Agent's request file any claims, proofs of
claim, or other instruments of similar character necessary to enforce the
obligations of such Borrower(s) in respect of the Officer Subordinated Debt and
will hold in trust for Lenders and pay over to Agent in the same form received,
to be applied on the Senior Debt as determined by Agent, any and all money,
dividends or other assets received in any such proceedings on account of the
Officer Subordinated Debt, unless and until the Senior Debt shall be paid in
full, including without limitation interest owing to Lenders after the
commencement of a bankruptcy proceeding at the rate specified in the Loan
Agreement, whether or not such interest is an allowable claim in any such
proceeding. Agent may, as attorney-in-fact for the undersigned, take such action
on behalf of the undersigned and the undersigned hereby appoints Agent (for the
benefit of Lenders) as attorney-in-fact for the undersigned to demand, xxx for,
collect, and receive any and all such money, dividends or other assets and give
acquittance therefore and to file any claim, proof of claim or other instrument
of similar character and to take such other proceedings in Agent's name or in
the name of the undersigned, as Agent or Lenders may deem necessary or advisable
for the enforcement of this Agreement. The undersigned will execute and deliver
to Agent or Lenders such other and further powers of attorney or other
instruments as either reasonably may request in order to accomplish the
foregoing.
8. Lenders and/or Agent may at any time and from time to time, without
the consent of or notice to the undersigned, without incurring responsibility to
the undersigned and without impairing or releasing any of Agent's or Lenders'
rights, or any of the obligations of the undersigned hereunder:
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(a) Change the amount, manner, place or terms of payment or change
or extend the time of payment of or renew or alter the Senior Debt, or any part
thereof, or amend, supplement or replace the Loan Agreement and/or any notes
executed in connection therewith in any manner or enter into or amend,
supplement or replace in any manner any other agreement relating to the Senior
Debt;
(b) Sell, exchange, release or otherwise deal with all or any part
of any property at any time pledged or mortgaged by any party to secure or
securing the Senior Debt or any part thereof;
(c) Release anyone liable in any manner for the payment or
collection of the Senior Debt;
(d) Exercise or refrain from exercising any rights against
Borrowers or others (including the undersigned); and
(e) Apply sums paid by any party to the Senior Debt in any order
or manner as determined by Agent and Lender.
9. The undersigned will advise each future holder of all or any part
of the Officer Subordinated Debt that the Officer Subordinated Debt is
subordinated to the Senior Debt in the manner and to the extent provided herein.
The undersigned represents that no part of the Officer Subordinated Debt or any
instrument evidencing the same has been transferred or assigned and the
undersigned will not transfer or assign, except to Agent for the benefit of
Lenders, any part of the Officer Subordinated Debt while any Senior Debt remains
outstanding, unless such transfer or assignment is made expressly subject to
this Agreement. Upon Agent's request, the undersigned will in the case of any
Officer Subordinated Debt which is not evidenced by any instrument cause the
same to be evidenced by an appropriate instrument or instruments, and place
thereon and on any and all instruments evidencing the Officer Subordinated Debt
a legend in such form as Agent may determine to the effect that the indebtedness
evidenced thereby is subordinated and subject to the prior payment in full of
all Senior Debt pursuant to this Subordination Agreement, as well as deliver all
such instruments to Agent.
10. This Subordination Agreement contains the entire agreement between
the parties regarding the subject matter hereof and may be amended, supplemented
or modified only by written instrument executed by Agent, on behalf of Lenders,
and the undersigned. This Subordination Agreement, and the rights shall
terminate upon indefeasible payment in full of all liabilities and obligations
owing from Borrowers to Agent and Lenders and termination of the Revolving
Credit under the Loan Agreement.
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11. The undersigned represents and warrants that neither the execution
or delivery of this Subordination Agreement nor fulfillment of nor compliance
with the terms and provisions hereof will conflict with, or result in a breach
of the terms, conditions, or provisions of or constitute a default under any
agreement or instrument to which the undersigned or any of the undersigned's
assets is now subject.
12. Any notice of acceptance of this Subordination Agreement is hereby
waived.
13. This Subordination Agreement may be assigned by Agent and/or
Lenders, or any of them, in whole or in part in connection with any assignment
or transfer of any portion of the Senior Debt.
14. This Subordination Agreement shall be binding upon the undersigned,
and the undersigned's successors, representatives and assigns.
15. Except as provided in paragraph 2 above, each Borrower agrees that
it will not make any payment on any of the Officer Subordinated Debt, or take
any other action in contravention of the provisions of this Subordination
Agreement.
16. This Subordination Agreement shall in all respects be interpreted,
construed and governed by the substantive laws of the Commonwealth of
Pennsylvania. The undersigned (i) submits to the jurisdiction of the Courts of
the Commonwealth of Pennsylvania or the United States District Court for the
Eastern District of Pennsylvania for the purposes of resolving any controversy
relating thereto and (ii) waives the right to a jury trial for the purpose of
resolving any controversy hereunder or enforcing or defending any rights or
claim hereunder or in connection herewith, whether sounding in contract, tort or
otherwise.
MCC FINANCIAL CORPORATION
EXECUTIVE DEFERRED COMPENSATION
PLAN, THE XXXXXXX XXXXXXXX ACCOUNT
By: /s/Xxxxxxx Xxxxxxxx
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Xxxxxxx Xxxxxxxx
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Consented and agreed to as of the date first above written:
Capital Associates, Inc.
By: /s/Xxxxx Xxxxxxxxx
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Xxxxx Xxxxxxxxx
Title: Vice President
Capital Associates International, Inc.
By: /s/Xxxxx Xxxxxxxxx
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Xxxxx Xxxxxxxxx
Title: Vice President
First Union National Bank, as Agent
By: /s/Xxxx Xxxxxxxx
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Xxxx Xxxxxxxx, Vice President
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