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EXHIBIT 4.1(d)
AMENDED AND RESTATED
SUBORDINATION AGREEMENT
BETWEEN
XXXXXX'X FURNITURE, INC.
AND
CONGRESS FINANCIAL CORPORATION (WESTERN)
AUGUST 26, 1996
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TABLE OF CONTENTS
Page
1. Certain Defined Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
a. General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
b. Other Terms . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2. Representations, Warranties, and Covenants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
a. Amount of Junior Debt . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
b. Junior Debt Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
c. No Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
d. Notice of Default . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
e. Further Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
3. Subordination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
a. General . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
b. Payments to Subordinating Lender . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
c. Priority of Interests in Collateral . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
4. Restrictions on Subordinating Lender's Actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
5. Remedies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
6. No Action to Violate Senior Lender Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
7. No Amendment of Junior Debt Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
8. Extensions, Compromises, etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
9. Waiver . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
10. No Constraint on Senior Lender . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
11. Impact of Bankruptcy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
12. Miscellaneous . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
a. Amendment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
b. Binding Effect; Governing Law; Venue . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
c. Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
d. Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
e. Attorneys' Fees; etc . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
f. Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
g. Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
h. Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
i. Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
j. Rules of Construction . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
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EXHIBIT 4.1(d)
AMENDED AND RESTATED
SUBORDINATION AGREEMENT
THIS AMENDED AND RESTATED SUBORDINATION AGREEMENT (the "Agreement"),
dated as of August 26, 1996, is entered into by and between XXXXXX'X FURNITURE,
INC., a Delaware corporation ("Subordinating Lender"), and CONGRESS FINANCIAL
CORPORATION (WESTERN) ("Senior Lender"), with reference to the following facts:
RECITALS
X. Xxxxxx'x Sofa Factory, a California corporation ("Borrower"),
has entered into the Junior Debt Documents (as defined below) with
Subordinating Lender, pursuant to which Subordinating Lender has extended
certain financial accommodations to Borrower on the terms and conditions set
forth in such Junior Debt Documents.
B. Senior Lender has entered into various agreements with
Borrower, including that certain Loan and Security Agreement between Senior
Lender and Borrower and its wholly owned subsidiary, Xxxxxx Convertible
Corporation, a New York corporation, as co-borrowers, and other agreements,
documents and instruments, dated as of January 20, 1995, (the Loan and Security
Agreement as amended by that certain First Amendment to Loan and Security
Agreement dated as of May 10, 1996 and that certain Second Amendment to Loan
and Security Agreement dated as of even date herewith), as subsequently amended
or modified from time to time (collectively, the "Senior Loan Agreement"),
pursuant to which Senior Lender has agreed to extend certain revolving and
equipment acquisition term loans to Borrower. In order to induce Senior Lender
to enter into the Senior Loan Agreement, Subordinating Lender entered into that
certain Subordination Agreement with Borrower dated as of January 20, 1995 (the
"Original Subordination Agreement").
C. Simultaneously with the execution of this Agreement, Borrower
is (i) receiving an additional contribution of equity capital from
Subordinating Lender in the amount of Five Million Dollars ($5,000,000) and
(ii) borrowing Five Million Dollars ($5,000,000) in cash from Subordinating
Lender, such additional indebtedness to be evidenced by a promissory note dated
as of even date herewith issued by Borrower payable to the order of
Subordinating Lender (said additional equity contribution and additional
indebtedness being hereafter referred to as the "Recapitalization");
D. Senior Lender is unwilling to consent to the Recapitalization
unless Subordinating Lender enters into this Agreement amending and restating
the terms of the Original Subordination Agreement in their entirety.
E. Subordinating Lender is interested in the financial success of
Borrower and will benefit by the loans which Senior Lender has extended and
continues to extend to Borrower under the Senior Loan Agreement.
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F. Accordingly, to induce Senior Lender to enter into the Senior Loan
Agreement with Borrower and to extend to Borrower the loans contemplated
thereunder, Subordinating Lender is willing to enter into this Agreement with
Senior Lender.
AGREEMENT
NOW, THEREFORE, the parties agree as follows:
1. Certain Defined Terms.
a. General: When used in this Agreement, the following
terms have the following respective meanings:
"Agreement" has the meaning set forth in the introduction
hereto.
"Borrower" has the meaning set forth in the recitals of this
Agreement.
"Junior Debt" means all present and future indebtedness and
other obligations (direct or indirect) owing by Borrower to Subordinating
Lender, including, but not limited to:
(i) Indebtedness in the aggregate amount of Nine Million Four
Hundred Fifty Thousand Dollars ($9,450,000), itemized as follows: (A) Two
Million Seven Hundred Thousand Dollars ($2,700,000), which amount is the result
of reducing the outstanding principal amount of outstanding indebtedness of
Four Million Seven Hundred Thousand Dollars ($4,700,000) as of January 20, 1995
by Two Million Dollars ($2,000,000) funded from the initial advances by Senior
Lender to Borrower under the Senior Loan Agreement, (B) aggregate indebtedness
in the amount of One Million Seven Hundred Fifty Thousand Dollars ($1,750,000)
advanced to Borrower by Subordinating Lender during the period from January 20,
1995 through August 22, 1996, and (C) indebtedness in the amount of Five
Million Dollars ($5,000,000) advanced to Borrower by Subordinating Lender in
connection with the Recapitalization (collectively, the "Note Indebtedness"),
and
(ii) Up to One Million Dollar ($1,000,000) in payment under
Borrower's agreement to indemnify Subordinating Lender from any loss, cost,
expense or liability incurred by Subordinating Lender in providing cash
collateral for the issuance of a One Million Dollar ($1,000,000) standby letter
of credit for the benefit of the landlord of Borrower's Brea, California
facility, which letter of credit expires in 1999, and if drawn prior to its
expiry, will be treated as a bullet loan from Subordinating Lender to Borrower
due and payable on January 20, 2000 in the amount of any draw thereunder (the
"LC Indebtedness"). "Junior Debt" includes (without limitation) indebtedness
owed under the Junior Debt Documents, together with any other debts, demands,
monies, indebtedness, liabilities, and obligations now or hereafter owed by
Borrower to Subordinating Lender, including interest, principal, costs, and
other charges, together with all claims, rights, causes of action, judgments,
decrees and other obligations.
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"Junior Debt Documents" means all instruments and agreements
evidencing the Junior Debt, including (i) that certain Amended and Restated
Promissory Note, dated as of January 20, 1995, in the original principal amount
of Two Million Seven Hundred Thousand Dollars ($2,700,000), executed by Borrower
to the order of Subordinating Lender, (ii) those certain Promissory Note in the
aggregate original principal amount One Million Seven Hundred Fifty Thousand
Dollars ($1,750,000), dated, respectively: as of September 22, 1995 in the
original principal amount of $500,000; as of May 3, 1996 in the original
principal amount of $500,000; and as of May 22, 1996 in the original amount of
$750,000, each executed by Borrower to the order of Subordinating Lender, (iii)
that certain Promissory Note in the original principal amount of Five Million
Dollars ($5,000,000) dated as of August 26, 1996 executed by Borrower to the
order of Subordinating Lender, and (iv) that certain Promissory Note, amended
and restated as of January 20, 1995, evidencing the LC Indebtedness in the
original principal amount of One Million Dollars ($1.000.000), copies of which
are attached hereto as Exhibit A and incorporated herein by this reference.
"Senior Debt" has the meaning set forth in Section 3(a) of
this Agreement.
"Senior Lender" has the meaning set forth in the introduction
of this Agreement.
"Senior Loan Agreement" has the meaning set forth in the
recitals of this Agreement.
"Subordinating Lender" has the meaning set forth in the
introduction of this Agreement.
b. Other Terms. Unless otherwise defined in this
Agreement, any and all initially capitalized terms set forth in this Agreement
shall have the meaning ascribed thereto in the Senior Loan Agreement.
2. Representations, Warranties, and Covenants. Subordinating
Lender and Borrower represent, warrant, and covenant (jointly and severally) to
Senior Lender that:
a. Amount of Junior Debt. As of the date of this
Agreement, the aggregate outstanding balance (principal plus interest) of the
Note Indebtedness is Nine Million Four Hundred Fifty Thousand Dollars
($9,450,000), and the maximum financial exposure of Borrower to Subordinating
Lender under Borrower's indemnify obligations to Subordinating Lender under the
LC Indebtedness is One Million Dollars ($1,000,000).
b. Junior Debt Documents. Upon Senior Lender's request,
to be given by notice to Borrower and Subordinating Lender: (i) a copy of all
Junior Debt Documents shall be delivered to Senior Lender; and/or (ii) all
Junior Debt Documents shall be conspicuously marked with substantially the
following legend:
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"Subject to that certain Amended and Restated Subordination Agreement
(Investor), dated as of August 26, 1996, between Xxxxxx'x Furniture,
Inc., a Delaware corporation, and Congress Financial Corporation
(Western)"
and after being so marked, the originals of the Junior Debt Documents shall be
exhibited to Senior Lender and a copy of the marked Junior Debt Documents shall
be delivered to Senior Lender.
c. No Default. Borrower is not in default under any
Junior Debt Document.
d. Notice of Default. Subordinating Lender and Borrower
shall each promptly notify Senior Lender of all defaults, events of default,
and events which with the giving of notice or the passage of time, or both,
would become events of default ("unmatured events of default") under any Junior
Debt Document.
e. Further Action. Upon Senior Lender's request,
Subordinating Lender will promptly take all actions which Senior Lender
believes appropriate to carry out the purposes of this Agreement.
3. Subordination.
a. General. As more fully provided in the remainder of
this Article 3, the Junior Debt is hereby subordinated and made junior to all
obligations now or hereafter owing to Senior Lender by Borrower. The
obligations referred to in the preceding sentence as being owing to Senior
Lender are referred to in this Agreement as the "Senior Debt," and include the
Obligations, all present and future representations, warranties, covenants,
agreements, indemnities, and other obligations which Borrower or its successors
and assigns may incur to Senior Lender, including (without limitation) those
incurred after the filing of a bankruptcy petition or commencement of a
bankruptcy case by or against Borrower.
b. Payments to Subordinating Lender. If no default or
event of default by Borrower under any present or future instrument or
agreement (including the Senior Loan Agreement) between Borrower and Senior
Lender shall have occurred, Borrower may make the following payments against
the Junior Debt:
(i) Note Indebtedness: Quarterly payments of
interest at one and one-half (1.5) percentage points in excess of the
Prime Rate, as defined in the Senior Loan Agreement, commencing August
31, 1996; and semi-annual payments of principal, commencing December
31, 1996, in an amount not to exceed fifty percent (50%) of Excess
Cash Flow for the applicable semi-annual period, if any (for the
purposes of this Section 3(b)(i), "Excess Cash Flow" shall mean, for
any applicable semi-annual period, net income after tax, exclusive of
extraordinary gains, plus depreciation and any other non-cash
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items to the extent deducted from the revenues of Borrower in the
calculation of net income or loss, and less any capital expenditures
that are actually made and not financed during such period); provided,
however, that principal payments shall not be permitted unless,
notwithstanding the availability of Excess Cash Flow, after giving
effect to such principal payment, Borrower has a minimum of One
Million Dollars ($1,000,000) Excess Availability, as defined under the
Senior Loan Agreement, as of the last day of the applicable
semi-annual period. Borrower shall be permitted to pay the
semi-annual principal payments upon receipt and review by Lender of
Borrower's financial statements for the semi-annual period to which
the requested payment relates, which financial statements shall be
prepared in accordance with GAAP consistently applied subject to
normal year-end audit adjustments and shall show sufficient Excess
Cash Flow to permit the principal payment and the required minimum
Excess Availability.
(ii) LC Indebtedness: In the event that the letter
of credit for which the Subordinating Lender provided cash collateral
is drawn by such landlord of Borrower's Brea, California facility,
prior to its expiry date in 1999, any amounts so drawn shall be
treated as the outstanding principal amount of a bullet loan from
Subordinating Lender to Borrower, all principal and unpaid interest
being due and payable by Borrower to Subordinating Lender on January
20, 2000; and prior to the expiration date of the letter of credit or
the date of a draw thereunder, whichever shall first occur, the amount
of the cash collateral provided by Subordinating Lender, and after a
draw against the letter of credit, the amount of the draw shall bear
interest at one and one-half (1.5) percentage points per annum in
excess of the Prime Rate, and Borrower may pay quarterly interest
payments of such interest commencing on March 31, 1995 until all
amounts due by Borrower to Subordinating Lender under the LC
Indebtedness have been repaid;
provided further, however, that after giving effect to any such payment to
Subordinating Lender, no default or event of default by Borrower under any
present or future instrument or agreement (including the Senior Loan Agreement
between Borrower and Senior Lender) shall have occurred. Except as provided in
this Agreement, Borrower and Subordinating Lender agree (and Subordinating
Lender acknowledges such agreement) that Borrower shall neither: (i) make
any payments to Subordinating Lender in respect of the Junior Debt; nor (ii)
without Senior Lender's prior written consent, execute or deliver any
negotiable instruments as evidence of the Junior Debt.
c. Priority of Interests in Collateral. Subordinating
Lender currently holds no security interest or lien in the Collateral, or in
any other assets of Borrower, as security for Borrower's payment and
performance of its obligations to Subordinating Lender under the Junior Debt
Documents, and no security interest or lien in the Collateral or in any other
assets of Borrower will be granted by Borrower to Subordinating Lender prior to
the termination of the Senior Loan Agreement. Not withstanding the foregoing,
in the event Subordinating Lender hereafter acquires any security interest,
lien, or other right or interest in the Collateral, such security interest,
lien, or other
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right or interest shall at all times prior to the indefeasible payment in full
of the Senior Debt be junior, subordinate and subject to any security interest,
lien or other right or interest Senior Lender now has or may hereafter acquire
in the Collateral. The subordination provided in this Section 3(c) shall apply
irrespective of the time or order of attachment or perfection of any security
interest, irrespective of the time or order of filing of any financing
statement or other document, and irrespective of any statute, rule, law, or
court decision to the contrary.
4. Restrictions on Subordinating Lender's Actions. Unless it
shall have obtained Senior Lender's prior written consent, until the Senior
Debt has been paid in full Subordinating Lender will not: (i) demand or accept
any payment upon the Junior Debt, except as may be permitted by this Agreement;
(ii) foreclose or realize upon any collateral hereafter securing the Junior
Debt (whether such collateral constitutes part of the Collateral or consists of
other assets of Borrower), or otherwise enforce any security agreement,
mortgage, lien instrument, or other encumbrance hereafter securing the Junior
Debt; or (iii) commence, prosecute, or participate in any administrative,
legal, or equitable action that in Senior Lender's judgment might adversely
affect Borrower's business or Borrower's ability to pay the Senior Debt.
5. Remedies. If Borrower or Subordinating Lender attempts to
violate Section 3(b) or Clause (i) of Article 4, or if Subordinating Lender in
any other manner receives any funds which by virtue of this Agreement it is
precluded from receiving, Subordinating Lender shall be deemed to hold any
payment or distribution it receives in trust for Senior Lender's benefit. In
such case, Subordinating Lender shall immediately remit such payment or
distribution to Senior Lender. If Subordinating Lender attempts to violate
Clause (ii) of Article 4, Senior Lender (in Senior Lender's or Borrower's name)
or Borrower may seek injunctive or other equitable relief to prevent or stop
Subordinating Lender's actions, it being agreed that legal remedies may be
inadequate. If Subordinating Lender attempts to violate Clause (iii) of
Article 4, Borrower may interpose as a defense or plea the making of this
Agreement, and Senior Lender may intervene and interpose such defense or plea
in its own or Borrower's name. The remedies provided in this Article 5 are not
exclusive; Senior Lender shall be entitled to all other remedies available at
law or in equity.
6. No Action to Violate Senior Lender Agreements. Subordinating
Lender shall not take any action which in Senior Lender's judgment might cause
Borrower to violate the Senior Loan Agreement or any other agreement between
Borrower and Senior Lender.
7. No Amendment of Junior Debt Documents. Unless Senior Lender's
prior written consent shall have been obtained, no Junior Debt Document may be
amended or modified.
8. Extensions, Compromises, etc. Without having to obtain either
Borrower's or Subordinating Lender's consent, Senior Lender may grant to
Borrower extensions of the time of payment or performance, and may enter into
compromises (including releases of collateral and settlements) with Borrower
with respect to the Senior Debt.
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9. Waiver. Subordinating Lender waives any right it may now or
hereafter have to require Senior Lender to xxxxxxxx assets, to exercise rights
or remedies in a particular manner, or to forbear from exercising such rights
and remedies in any particular manner or order.
10. No Constraint on Senior Lender. Nothing contained in this
Agreement shall preclude Senior Lender from discontinuing its extension of
credit to Borrower (whether under the Senior Loan Agreement or otherwise) or
from taking (without notice to Subordinating Lender, Borrower, or any other
individual or entity) any other action in respect of the Senior Debt or the
Collateral which Senior Lender is otherwise entitled to take with respect to
the Senior Debt or the Collateral. Among the actions which Lender may take in
accordance with this Article 10 are: renewing, extending, and increasing the
amount of the Senior Debt; otherwise changing the terms of the Senior Debt;
settling, releasing, compromising, and collecting on the Senior Debt; making
(and refraining from making) other secured and unsecured loans and advances to
Borrower; amending any present or future agreement between Senior Lender and
Borrower; and all other actions which Senior Lender deems advisable.
11. Impact of Bankruptcy. If a voluntary or involuntary
bankruptcy petition shall be filed respecting Borrower: (a) this Agreement
(including the subordination provisions contained in Article 3) shall continue
in full force and effect; (b) Subordinating Lender shall take no action in the
bankruptcy proceeding which might (in Senior Lender's opinion) adversely affect
Senior Lender's rights and interests respecting the Senior Debt; and (c)
Subordinating Lender shall take all actions reasonably requested by Senior
Lender to protect Senior Lender's interests during the course of such
bankruptcy proceedings.
12. Miscellaneous.
a. Amendment. No amendment or waiver of this Agreement
shall be effective unless in a writing signed by each party hereto.
b. Binding Effect; Governing Law; Venue. This
Agreement shall be binding upon and inure to the benefit of the parties and
their respective successors and assigns. This Agreement shall be governed by
and construed in accordance with the internal laws of the State of California.
All actions and proceedings arising in connection with this Agreement shall be
tried and litigated only in state or federal courts located in Los Angeles
County, California, or (at Senior Lender's sole option) in any other court in
which Senior Lender may initiate legal or equitable proceedings, so long as
such court has subject matter jurisdiction. Subordinating Lender and Borrower
each waive any right it may have to plead forum non-conveniens or otherwise to
object to venue, and hereby consents to any court-ordered relief.
c. Counterparts. This Agreement may be executed in
counterparts, each of which shall be deemed an original and all of which
together shall constitute one agreement.
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d. Headings. The headings contained in this Agreement
are for convenience only. They shall not affect the interpretation of this
Agreement.
e. Attorneys' Fees: etc. In any suit or action brought
to enforce this Agreement or to obtain an adjudication (declaratory or
otherwise) of rights or obligations hereunder, the losing party shall pay to the
prevailing party reasonable attorneys' fees and other costs and expenses
incurred by the prevailing party.
f. Severability. Any provision of this Agreement that
is prohibited by law or unenforceable in any jurisdiction shall be ineffective
in that jurisdiction to the extent of such prohibition or unenforceability,
without invalidating the remaining provisions hereof or affecting the validity
or enforceability of such provision in any other jurisdiction. To the extent
permissible, the parties waive any law that renders this Agreement prohibited
or unenforceable.
9. Entire Agreement. This Agreement constitutes the entire agreement
between and among the parties regarding the subject matter hereof. This
Agreement supersedes all prior and contemporaneous agreements between or among
the parties with respect to the subject matter hereof.
h. Notice. All notices or demands by any party
hereunder must be in writing and personally delivered or sent by registered or
certified mail, postage prepaid, return receipt requested, or by a nationally
recognized overnight courier, as follows:
Senior Lender: CONGRESS FINANCIAL CORPORATION (WESTERN)
000 Xxxxx Xxxx Xxxxxx, Xxxxx 0000
Xxxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxx, Vice President
with a copy to: XXXXXX XXXX & XXXXXX
000 X. Xxxxxx Xxxxxx, Xxxxx 0000
Xxx Xxxxxxx, Xxxxxxxxxx 00000
Attn: Xxxxx X. Xxxxxxxxxxx, Esq.
Subordinating
Lender: XXXXXX'X FURNITURE, INC.
0000 Xxxxxxxxxx Xxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxxxxx 00000
Attn: President
Borrower: XXXXXX'X SOFA FACTORY
000 Xxxxx Xxxxx Xxxxxx
Xxxx, Xxxxxxxxxx 00000-0000
Attn: Chief Financial Officer
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The parties may change the address at which they receive notice by giving
notice to each other in the foregoing manner. Notices or demands sent in
accordance with this Section shall be deemed to be received on the earlier of
the date of actual receipt or five (5) calendar days after deposit in the
United States mail.
i. Termination. This Agreement shall continue in full
force and effect until Borrower has satisfied in full the Senior Debt.
j. Rules of Construction. As used in this Agreement, the
singular includes the plural; the plural includes the singular. References
to one gender include all genders. Unless otherwise specified, references to
Articles, Sections, Exhibits, and parties refer to Articles, Sections,
Exhibits, and parties of or to this Agreement. The words "include,"
"including," and similar words are not intended to be limiting.
IN WITNESS WHEREOF, the parties have caused this Agreement to be
executed by their respective duly authorized officers, as of the date first
above written.
XXXXXX'X FURNITURE, INC.
a Delaware corporation
By: XXXXXX X. XXXXXX
----------------------------
Xxxxxx X. Xxxxxx
Executive Vice President
CONGRESS FINANCIAL CORPORATION
(WESTERN)
By: [SIG]
-----------------------------
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BORROWER'S ACKNOWLEDGMENT
The undersigned Borrower hereby approves of, and agrees and consents
to, the foregoing Amended and Restated Subordination Agreement, dated as of
August 26, 1996, between Xxxxxx'x Furniture, Inc. and Congress Financial
Corporation (Western) (the "Amended and Restated Subordination Agreement").
Unless otherwise defined in this Acknowledgment, terms defined in the Amended
and Restated Subordination Agreement have the same meanings when used in this
Acknowledgment.
Borrower agrees to be bound by the Amended and Restated Subordination
Agreement. Borrower further agrees that the Amended and Restated Subordination
Agreement may be amended by Senior Lender and Subordinating Lender without
notice to, or the consent of, Borrower.
XXXXXX'X SOFA FACTORY,
a California corporation
By: XXXXXXX X. XXXXXXXX
----------------------------
Xxxxxxx X. Xxxxxxxx
President and Chief Executive
Officer
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