EXHIBIT 10.16
SECOND AMENDMENT TO
SUBORDINATION AND
INTERCREDITOR AGREEMENT
Amendment dated as of June 29, 2001 by and among the parties whose names
appear below (this "Amendment") to a certain Intercreditor Agreement (as defined
below). Unless otherwise defined below, capitalized terms used in this
Agreement shall have the respective meanings set forth in the Intercreditor
Agreement.
RECITALS
WHEREAS, LTHI proposes to issue, and Capital Resource Partners IV, L.P.
("CRP IV"), proposes to purchase, up to $5,000,000 principal amount of
promissory notes (the "Bridge Notes") and warrants to purchase common stock of
the Company upon the terms and conditions set forth in Exhibit A hereto; and
WHEREAS, the Bank is willing to consent to the issuance of the Bridge Notes
on the condition that CRP IV, the Purchaser, the Borrowers and the affiliates of
the Borrowers who are parties to the Intercreditor Agreement enter into this
Amendment with the Bank in order to provide that the terms of subordination
between the Bank and the Purchaser set forth in the Intercreditor Agreement also
apply to CRP IV and the Bridge Notes; and
NOW, THEREFORE, in consideration of the foregoing premises and the
covenants contained herein, and for other good and valuable consideration, the
receipt of which is hereby acknowledged, the parties agree as follows:
Section 11. Definitions.
As used in this Amendment, capitalized terms used in this Amendment shall
have the respective meanings set forth in the Intercreditor Agreement, except as
otherwise defined above and except the following capitalized terms shall have
the following respective meanings:
"Intercreditor Agreement" means that certain Subordination and
Intercreditor Agreement dated as of February 26, 1999, as amended by the
First Amendment thereto dated as of June 28, 2001, by and among the Bank,
the Original Parties and the Additional Parties.
Section 12. Amendment of Intercreditor Agreement.
a. The definition of "Subordinate Liabilities" set forth in the
Intercreditor Agreement is hereby amended and restated in its entirety as
follows:
""Subordinate Liabilities" shall mean (a) all indebtedness of the
Company to the Subordinated Creditor for principal of and interest on the
Notes, together
with any prepayment fees or premiums under the Notes, (b) all indebtedness
of LTHI to the Subordinated Creditor for principal of and interest on the
Bridge Notes, together with any prepayment fees or premiums under the
Bridge Notes, (c) all indebtedness of the Dutch Subsidiary to the
Subordinated Creditor under the Dutch Guarantee, and (d) all other
indebtedness or liabilities of the Borrowers, direct or indirect,
contingent or noncontingent, now existing or hereafter incurred or now or
hereafter due and owing to the Subordinated Creditor under or with respect
to the Notes, the Dutch Guarantee or the Purchase Agreement or otherwise,
including fees, reimbursement obligations, expenses, costs, and post-
petition interest in bankruptcy."
b. The definition of "Subordinated Creditor" set forth in the
Intercreditor Agreement is hereby amended and restated in its entirety as
follows:
""Subordinated Creditor" shall mean the Purchaser, CRP IV and any
holder of the Subordinate Liabilities."
c. Section 4.3 of the Intercreditor Agreement is hereby amended by
inserting after the work "Notes" and before the word "; provided," in the
twenty-first line of such section the following additional clause:
"and (v) any regularly-scheduled payments of interest and/or principal in
accordance with the terms of the Bridge Note, including, without
limitation, repayment of the Bridge Note on October 31, 2001 (provided five
(5) business days' notice is given to the Senior Lender in respect of any
payments of principal)"
Section 13. Miscellaneous.
Except as amended hereby, the Subordination Agreement shall remain in full
force and effect. This Amendment may be executed in any number of counterparts
and by different parties hereto in separate counterparts, each of which when so
executed and delivered shall be deemed an original, and all of which
counterparts taken together shall constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement under
seal as of the date first above written.
THE BANK:
SILICON VALLEY BANK
BY: /s/ Xxxx X. Xxxxxxx, Xx.
--------------------------
Name:
Title:
CRP IV:
CAPITAL RESOURCE PARTNERS IV, L.P.,
BY: CRP PARTNERS IV, L.L.C.,
its General Partner
By: /s/ Xxxxxxx X. Xxxxx
----------------------
Xxxxxxx X. Xxxxx, Managing Member
THE ORIGINAL AND ADDITIONAL PARTIES:
CAPITAL RESOURCE LENDERS III, L.P.,
BY: CAPITAL RESOURCE PARTNERS III,
L.L.C., its General Partner
By: /s/ Xxxxxxx X. Xxxxx
----------------------
Xxxxxxx X. Xxxxx, Managing Member
LIONBRIDGE TECHNOLOGIES HOLDINGS, B.V.
BY: /s/ Xxxx X. Xxxxx
-------------------
Name: Xxxx X. Xxxxx
Title: Chairman, CEO and President
LIONBRIDGE TECHNOLOGIES, B.V.
BY: /s/ Xxxx X. Xxxxx
-----------------
Name: Xxxx X. Xxxxx
Title: Chairman, CEO and President
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LIONBRIDGE TECHNOLOGIES, INC.
(f/k/a Lionbridge Technologies Holdings, Inc.)
BY: /s/ Xxxx X. Xxxxx
-----------------
Name: Xxxx X. Xxxxx
Title: Chairman, CEO and President
LIONBRIDGE TECHNOLOGIES IRELAND
BY: /s/ Xxxx X. Xxxxx
-----------------
Name: Xxxx X. Xxxxx
Title: Chairman, CEO and President
LIONBRIDGE TECHNOLOGIES CALIFORNIA, INC.
BY: /s/ Xxxx X. Xxxxx
-----------------
Name: Xxxx X. Xxxxx
Title: Chairman, CEO and President
LIONBRIDGE AMERICA, INC.
(f/k/a Lionbridge Technologies, Inc.)
By: /s/ Xxxx X. Xxxxx
-----------------
Name: Xxxx X. Xxxxx
Title: Chairman, CEO and President
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LIONBRIDGE K.K.
(f/k/a Lionbridge Japan K.K.)
By: /s/ Xxxx X. Xxxxx
-----------------
Name: Xxxx X. Xxxxx
Title: Chairman, CEO and President
JAPANESE LANGUAGE SERVICES, INC.
By: /s/ Xxxx X. Xxxxx
-----------------
Name: Xxxx X. Xxxxx
Title: Chairman, CEO and President
LIONBRIDGE TECHNOLOGIES SARL
(f/k/a Lionbridge Technologies (France)
By: /s/ Xxxx X. Xxxxx
-----------------
Name: Xxxx X. Xxxxx
Title: Chairman, CEO and President
INT'X.xxx, INC.
BY: /s/ Xxxx X. Xxxxx
-----------------
Name: Xxxx X. Xxxxx
Title: Chairman, CEO and President
INTERNATIONAL LANGUAGE ENGINEERING
CORPORATION
BY: /s/ Xxxx X. Xxxxx
-----------------
Name: Xxxx X. Xxxxx
Title: Chairman, CEO and President
HARVARD TRANSLATIONS, INC.
BY: /s/ Xxxx X. Xxxxx
-----------------
Name: Xxxx X. Xxxxx
Title: Chairman, CEO and President
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EXHIBIT A
---------
BRIDGE NOTE TERMS
CAPITAL RESOURCE PARTNERS IV
JUNE 26, 2001
Borrower: Lionbridge Technologies Holdings, Inc.
Lender: Capital Resource Partners IV (CRP IV)
Amount: $5.0 million
Coupon: 12.0% payable quarterly
Repayment: Due in full including all accrued and unpaid interest on
October 31, 2001 unless previously converted.
Conversion: Upon a Qualified Financing, the Bridge Note and all accrued but
unpaid interest will convert to the form of the Qualified
Financing. A Qualified Financing will be a Senior Subordinated
Note and Warrant financing provided by Capital Resource Partners
on the terms outlined in the Letter of Intent dated June 26,
2001.
Warrant
Coverage: CRP IV will receive a Common Stock Warrant for the number of
common shares determined by dividing $1.0 million by 80.0% of the
45 trading day trailing average closing share price on October
31, 2001. The conversion price of the Common Stock Warrant will
be the 45 trading day trailing average closing share price on
October 31, 2001. However, in no case will the total shares
represented by this Warrant exceed 900,000.
If the Series A financing is not completed by October 31, 2001
and the Bridge Note is not repaid, then the Bridge Note will
convert into an $8.0 million 12.0% Senior Subordinated Note due
September 30, 2006 which shall have no amortization prior to its
September 30, 2006 maturity date.
Conditions: The proceeds of the Bridge Note will be used as a deposit in
conjunction with Lionbridge's bid to acquire Xxxxxx X.X. and
other corporate purposes. All other Terms and Conditions of the
Bridge Note will be standard for a financing of this type.
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