EXHIBIT 10.10
SUBORDINATION AGREEMENT
SUBORDINATION AGREEMENT (as amended, modified or otherwise
supplemented from time to time, this "AGREEMENT"), dated as of April 11, 2006,
by and among NAVISITE, INC., a Delaware corporation (together with its
successors and permitted assigns, the "COMPANY"), the subsidiaries of the
Company party hereto (together with their respective successors and permitted
assigns the "OTHER OBLIGORS"), SILVER POINT FINANCE, LLC, ("SILVER POINT") in
its capacity as Administrative Agent to the lenders party to the Credit
Agreement (defined below) (in such capacity, together with its successors in
such capacity, the "SENIOR AGENT"), ATLANTIC INVESTORS, LLC, a Delaware limited
liability company (together with its successors and permitted assigns,
"ATLANTIC") and UNICORN WORLDWIDE HOLDINGS LIMITED, a British Virgin Islands
corporation (together with its successors and permitted assigns the
"SUBORDINATED GUARANTOR", and together with Atlantic, the "SUBORDINATED
CREDITORS").
WHEREAS, the Company, the Other Obligors, the lenders party thereto
(together with their respective successors and assigns the "SENIOR LENDERS"),
the Senior Agent and Silver Point, in its capacity as collateral agent, have
entered into that certain Credit and Guaranty Agreement, dated as of the date
hereof (as the same may be amended, modified, supplemented, renewed, replaced or
restated from time to time, the "CREDIT AGREEMENT") pursuant to which the Senior
Lenders have agreed to provide certain credit facilities to the Company;
WHEREAS, Atlantic has agreed to provide financing to the Company on a
subordinated basis pursuant to the Atlantic Existing Credit Facility and the
Atlantic Term Loan Agreement, and the Subordinated Guarantor has agreed to
guaranty Atlantic's obligations under the Atlantic Term Loan Agreement under,
and subject to the terms of, the Atlantic Fund Guaranty; and
WHEREAS, as a condition to the effectiveness of the Credit Agreement,
each Subordinated Creditor has agreed to enter into this Agreement for the
benefit of each of the Senior Parties to effect the subordination required under
the Credit Agreement.
NOW, THEREFORE, in consideration of the foregoing, the mutual
agreements herein contained and other good and valuable consideration, the
receipt and adequacy of which are hereby acknowledged, the parties hereto,
intending to be legally bound, hereby covenant and agree for the benefit of the
Senior Parties as follows:
1. Definitions. Terms not otherwise defined herein have the same respective
meanings given to them in the Credit Agreement. In addition, the following terms
shall have the following meanings:
"INDEMNITEES" means or any affiliate of any Agent or any Senior Lender
or any director, officer, agent or employee of any Senior Party or such
affiliate entitled to indemnification under the Credit Documents.
"PERMITTED SUBORDINATED DEBT PREPAYMENTS" means prepayments of amounts
outstanding under the Atlantic Existing Credit Facility in an aggregate amount
not to exceed $3,700,000; provided:
(i) (a) such payments are made with not more than 50% of the net Cash
proceeds (net of underwriting discounts and commissions and other
reasonable costs and expenses associated therewith, including reasonable
legal fees and expenses) in excess of $10,000,000 received by the Company
after the Closing Date from the sale of Capital Stock by the Company (other
than Capital Stock issued pursuant to an employee stock of stock option
compensation plan);
(b) such payments are made within five Business Days of the Company's
receipt of such net Cash proceeds;
(c) after giving effect to such payments, the sum of (i) the Company's
cash on hand, (ii) the undrawn principal amount of the Revolving Commitment
and (iii) the undrawn and available principal amount of loans under the
Atlantic Term Loan Agreement, shall equal or exceed $10,000,000; and
(f) no Default or Event of Default shall have occurred and be
continuing or shall result therefrom; or
(ii) such payments are made from an amount, if any, provided by Silver
Point, one or more of the Senior Lenders or any of their Affiliates may, at
their sole and absolute discretion expressly for such purpose.
"SENIOR DEBT" means any and all present and future obligations and
liabilities of the Company or any Other Obligor of every type and description
arising under or in connection with the Credit Agreement or any of the other
Credit Documents which are owed or may be owing to any Senior Parties or any of
their respective successors, transferees or assigns, whether for principal,
premium, interest, fees, reimbursement obligations, expenses, indemnities or
other amounts (including attorneys' fees and expenses) and whether due or not
due, direct or indirect, joint and/or several, absolute or contingent, voluntary
or involuntary, liquidated or unliquidated, determined or undetermined, and
whether now or hereafter existing, renewed or restructured, whether or not from
time to time decreased or extinguished and later increased, created or incurred,
whether or not arising after the commencement of a proceeding under the
Bankruptcy Code or any other bankruptcy, insolvency or similar proceeding
(including post-petition interest) and whether or not allowed or allowable as a
claim in any such proceeding, and whether or not recovery of any such
obligations or liability may be barred by a statute of limitations or such
obligation or liability may otherwise be unenforceable.
"SENIOR PARTIES" means the Senior Lenders, the Senior Agent, the
Collateral Agent and the Indemnitees.
"SUBORDINATED DEBT" means any and all present and future obligations
and liabilities of the Company or any Other Obligor of every type and
description owing to any of the Subordinated Creditors under or in connection
with the Subordinated Documents, whether for principal, premium, interest, fees,
reimbursement obligations, expenses, indemnities or other amounts (including
attorney's fees and expenses) and whether direct or indirect, joint and/or
several, voluntary or involuntary, liquidated or unliquidated, determined or
undetermined, absolute or contingent, due or not due, now existing or hereafter
existing, renewed or restructured, whether or not from time to time decreased or
extinguished and later increased, created or incurred, whether or not arising
after the commencement of a proceeding under any under the Bankruptcy Code or
any other bankruptcy, insolvency or similar proceeding (including post-petition
interest) and whether or not allowed or allowable as a claim in any such
proceeding, and whether or not recovery of any such obligations or liability may
be barred by a statute of limitations or such obligation or liability may
otherwise be unenforceable.
"SUBORDINATED DOCUMENTS" means, collectively, the Atlantic Existing
Credit Facility, the Atlantic Term Loan Agreement, the Atlantic Fund Guaranty
and any and all other documents, notes or instruments evidencing or further
guaranteeing or supporting directly or indirectly any of the Subordinated Debt,
whether now existing or hereafter created, and all documents, instruments and
agreement executed or delivered in connection with any of the foregoing.
2. General. The Subordinated Debt and any and all Subordinated Documents
shall be and hereby are subordinated in right of payment, in liquidation and in
all other respects to the prior indefeasible payment in full in cash of the
Senior Debt. Unless consented to in writing by the Senior Lenders, no payment,
prepayment or redemption (including any payment that may be payable by reason of
any other indebtedness of the Company being subordinated to payment of the
Subordinated Debt), other than Permitted Subordinated Debt Prepayments, shall be
made by or on behalf of the Company or any of the Other Obligors for or on
account of any Subordinated Debt, and no Subordinated Creditor shall take or
receive from the Company or any Other Obligor, directly or indirectly, in cash,
other property, or any rights or by set-off or in any other manner, including,
without limitation, from or by way of collateral, payment of all or any of the
Subordinated Debt (other than its receipt of Permitted Subordinated Debt
Prepayments), unless and until the Senior Debt shall have been indefeasibly paid
in full in cash.
The Subordinated Creditors agree that notwithstanding the method of timing
of the granting, filing or perfection thereof, any and all liens, rights to
payment and any other rights granted by the Company and/or any Other Obligor
under or in connection with the Subordinated Documents for the benefit of any
Subordinated Creditor shall be junior and subordinate in all respects to the
liens, rights to payment and any other rights granted to the Senior Agent for
the benefit of any Senior Parties until such time as the obligations under the
Credit Agreement are indefeasibly paid in full in cash. Nothing
contained in this Section shall be deemed to permit any Lien in favor of any
Subordinated Creditor that is prohibited under the terms of the Credit
Documents.
3. Enforcement. No Subordinated Creditor will take or omit to take any
action or assert any claim with respect to the Subordinated Debt or which is
otherwise inconsistent with the provisions of this Agreement. Without limiting
the foregoing, no Subordinated Creditor will commence, join with any creditor
other than the Senior Parties in commencing, or directly or indirectly cause the
Company and/or the Other Obligors to commence or assist the Company and/or the
Other Obligors in commencing, any proceeding referred to in Section 4(a) of this
Agreement, and no Subordinated Creditor shall accelerate, demand, xxx for,
assert, collect or enforce any claim for or set-off with respect to principal,
premium, interest or any other amount constituting or payable with respect to,
or otherwise exercise any remedy under the Subordinated Debt or the Subordinated
Documents or any part thereof or take any action to foreclose or realize upon
the Subordinated Debt or any part thereof or enforce any of the Subordinated
Documents. Until the Senior Debt has been finally paid in full in cash, no
Subordinated Creditor shall enforce or exercise any right of subrogation,
reimbursement, restitution, contribution or indemnity whatsoever from any assets
of the Company and/or the Other Obligors, or any guarantor of or provider of
collateral security for the Senior Debt. Each Subordinated Creditor further
waives any and all rights with respect to marshalling.
If any amount of Senior Debt is outstanding, no Subordinated Creditor shall
accelerate any portion of the Subordinated Debt.
4. Payments Held on Deposit. In furtherance of subordination, each
Subordinated Creditor agrees as follows:
(a) In the event of any dissolution, winding up, liquidation,
reorganization, adjustment, protection, relief or composition of the
Company and/or any Other Obligor or its debts, whether voluntary or
involuntary, in any bankruptcy, insolvency, reorganization,
receivership, relief or other similar case or proceeding under any
bankruptcy or similar law, including any such similar laws which may
become effective after the date hereof, or upon an assignment for the
benefit of creditors or any other marshalling of the assets and
liabilities of the Company and/or any Other Obligor or in the event
any case, proceeding, assignment or marshalling as described above is
otherwise commenced by or against the Company and/or any Other
Obligor:
(i) the Senior Agent is hereby irrevocably authorized and empowered
(in its own name or in the name of the Subordinated Creditors or
otherwise), but shall have no obligation, to demand, xxx for,
collect and receive every payment or distribution of any kind
(whether in cash, property or securities) that otherwise would be
payable or deliverable upon or with respect to the Subordinated
Debt in any such case, proceeding, assignment, marshalling or
otherwise (including any payment that may be payable by reason of
any other
indebtedness of the Company and/or any Other Obligor being
subordinated to payment of the Subordinated Debt), and give
acquittance therefor and to file claims and proofs of claim and
take such other action (including, without limitation, voting the
Subordinated Debt or enforcing any security interest or other
lien securing payment of the Subordinated Debt) as it may deem
necessary or advisable for the exercise or enforcement of any of
the rights or interests of the Senior Parties hereunder; and
(ii) the Subordinated Creditors shall duly and promptly take such
action as the Senior Agent may request (A) to collect the
Subordinated Debt for the account of the Senior Parties and to
file appropriate claims or proofs of claim in respect of the
Subordinated Debt, (B) to execute and deliver to the Senior Agent
such powers of attorney, assignments, or other instruments as the
Senior Agent may request in order to enable the Senior Agent to
enforce any and all claims with respect to, any security
interests and other liens securing payment of, the Subordinated
Debt and (C) to collect and receive any and all payments or
distributions which may be payable or deliverable upon or with
respect to the Subordinated Debt.
(b) All payments or distributions upon or with respect to any of the
Subordinated Debt which are received by any of the Subordinated
Creditors prior to the indefeasible payment in full of all Senior Debt
(other than Permitted Subordinated Debt Prepayments) shall be received
for the benefit of the Senior Parties, shall be segregated from other
funds and property held by such Subordinated Creditors and shall be
forthwith paid over to the Senior Agent for the account of the Senior
Parties in the same form as so received (with any necessary
indorsement) to be applied to, or held as collateral for, the payment
or prepayment of the Senior Debt in accordance with the terms of the
Credit Agreement.
(c) The Senior Agent is hereby authorized to demand specific performance
of this Agreement, whether or not the Company or any Other Obligor
shall have complied with any of the provisions hereof applicable to
it, at any time when any of the Subordinated Creditors shall have
failed to comply with any of the provisions of this Agreement
applicable to them. The Subordinated Creditors hereby irrevocably
waive any defense based on the adequacy of a remedy at law, any
defense based on any action or inaction by any of the Senior Parties,
or any other defense, in each case, which might be asserted as a bar
to such remedy of specific performance.
5. Defense to Enforcement. If any Subordinated Creditor, in contravention
of the terms of this Agreement, shall commence, prosecute or participate in any
suit, action or proceeding against the Company or any Other Obligor relating to
the Subordinated Debt or any portion thereof, then the Company or Other Obligor
may
interpose as a defense or plea the making of this Agreement, and the Senior
Agent may intervene and interpose such defense or plea in its name or in the
name of the Company. If any Subordinated Creditor, in contravention of the terms
of this Agreement, shall attempt to collect any of the Subordinated Debt or
enforce any of the Subordinated Documents, then the Senior Agent or the Company
and/or any Other Obligor may, by virtue of this Agreement, restrain the
enforcement thereof in the name of the Senior Agent or in the name of the
Company and/or any Other Obligor.
6. Rights Acquired by Virtue of Subrogation, Etc. Each Subordinated
Creditor agrees that no payment or distribution to any Senior Party pursuant to
the provisions of this Agreement or any other Credit Document shall entitle the
Subordinated Creditors to exercise any rights acquired directly or indirectly by
virtue of assignment, subrogation or otherwise in respect of the Subordinated
Debt until the Senior Debt shall have been paid in full in cash.
7. Subordination Legend; Further Assurance. The Subordinated Creditors, the
Company and the Other Obligors will cause each instrument evidencing
Subordinated Debt to be endorsed with the following legend:
"The indebtedness evidenced by this instrument is subordinated to the
prior payment in full of the Senior Debt (as defined in the Subordination
Agreement hereinafter referred to) pursuant to, and to the extent provided
in, the Subordination Agreement dated as of April 11, 2006, as the same may
be amended, modified or restated from time to time (the "SUBORDINATION
AGREEMENT"), by, inter alia, the Company, the Other Obligors, the
Subordinated Creditors and the Senior Agent (as each such term is defined
in the Subordination Agreement)."
The Subordinated Creditors, the Company and each Other Obligor each will further
xxxx its books of account in such a manner as shall be effective to give proper
notice of the effect of this Agreement and will, in the case of any Subordinated
Debt which is not evidenced by any instrument, upon the Senior Agent's request
cause such Subordinated Debt to be evidenced by an appropriate instrument or
instruments endorsed with the above legend. The Subordinated Creditors, the
Company and each Other Obligor will, each at its own expense and at any time and
from time to time, promptly execute and deliver all further instruments and
documents, and take all further action, that may reasonably be deemed necessary
or desirable in the judgment of the Senior Agent, acting in accordance with the
Credit Agreement and this Agreement, in order to protect any right or interest
granted or purported to be granted hereby to the Senior Parties or to enable the
Senior Agent to exercise and enforce the rights and remedies of the Senior
Parties hereunder.
8. Agreement by the Company and Other Obligors. The Company and each Other
Obligor agrees that it will not make any payment of any of the Subordinated
Debt, or take any other action, in contravention of the provisions of this
Agreement.
9. Further Assurances. Each Subordinated Creditor, the Company and each
Other Obligor hereby agrees, upon request of the Senior Agent at any time and
from time to time, to execute such other documents or instruments and to take
such other actions as may be reasonably requested by the Senior Agent, acting in
accordance with the Credit Agreement and this Agreement, further to evidence on
the public record or otherwise perfect or evidence the senior priority of the
Senior Debt as contemplated hereby.
10. Senior Parties' Freedom of Dealing. Each Subordinated Creditor agrees,
with respect to the Senior Debt and any and all collateral therefor or guarantee
thereof, that any obligor with respect to the Senior Debt and the Senior Parties
may agree to modify the terms of any of the Senior Debt (including, without
limitation, modification(s) that may increase the principal amount of the loans
thereunder or increase the interest rate, fees or other amounts payable
thereunder or in connection therewith), and the Senior Parties may grant
extensions of the time of payment or performance with respect thereto and make
compromises, including releases of collateral or guaranties, and settlements
with the Company, the Other Obligors or other persons, in each case without the
consent of any Subordinated Creditor or the Company and without affecting the
agreements of any Subordinated Creditor or the Company contained in this
Agreement.
11. Agreements in Respect of the Subordinated Debt.
(a) The Subordinated Creditors will not, except with the prior written
consent of the Senior Agent, sell, assign, pledge, encumber or
otherwise dispose of any of the Subordinated Debt to a Person.
(b) Prior to the indefeasible payment in full in cash of the Senior Debt,
and notwithstanding anything to the contrary in the Subordinated
Documents, the Subordinated Creditors shall not, without the prior
written consent of the Senior Agent, agree to any amendment,
modification or supplement of the Subordinated Documents, provided,
however, that any undrawn commitments under the Atlantic Term Loan
Facility may be reduced by Atlantic pursuant to the terms of the
Atlantic Term Loan Agreement if (i) Atlantic shall given ten Business
Days' prior written notice of its intent to reduce such undrawn
commitment to the Senior Agent and the Company (which notice shall set
forth the amount of such proposed commitment reduction and the
proposed date thereof) and (ii) both before and after giving effect
thereto (A) the sum of (1) the Company's cash on hand and (2) the
undrawn principal amount of the Revolving Commitment for each of the
prior thirty days shall have been not less that $12,500,000, (ii) no
Default or Event of Default shall have occurred and be continuing and
(iii) the Company shall be in pro forma compliance with its financial
covenants contained in the Credit Agreement (as demonstrated to the
reasonable satisfaction of the Senior Agent) after giving effect to
such reduction.
(c) The Subordinated Creditors shall promptly notify the Senior Agent of
the occurrence of any default or event of default under the
Subordinated Debt or Subordinated Documents.
12. Obligations Absolute. Nothing contained in this Agreement shall impair,
as between the Company, the Other Obligors and any Subordinated Creditor, the
obligation of the Company and the Other Obligors to pay to the Subordinated
Creditor all amounts payable in respect of the Subordinated Debt as and when the
same shall become due and payable in accordance with the terms thereof, or
prevent such Subordinated Creditor (except as expressly otherwise provided in
this Agreement) from exercising all rights, powers and remedies otherwise
permitted by any Subordinated Document to which it is a party and by applicable
law upon a default in the payment of the Subordinated Debt or a default under
any Subordinated Document, in each case, however, subject to the rights of the
Senior Agent and the Senior Parties as set forth in this Agreement.
13. Senior Obligations Hereunder Not Affected. All rights and interests of
the Senior Parties hereunder, and all agreements and obligations of the
Subordinated Creditors, the Company and the Other Obligors under this Agreement,
shall remain in full force and effect irrespective of:
(a) any lack of validity or enforceability of any other Credit Document;
(b) any change in the time, manner or place of payment of, or in any other
term of, all or any of the Senior Debt, or any other amendment or
waiver of or any consent to any departure from any Credit Document,
including, without limitation, any increase in the Senior Debt
resulting from the extension of additional credit to the Company or
any of its subsidiaries or otherwise;
(c) any taking, exchange, release or non-perfection of any other
collateral, or any taking, release or amendment or waiver of or
consent to departure from any guaranty, for all or any of the Senior
Debt;
(d) any manner of application of the Collateral, or proceeds thereof, to
all or any of the Senior Debt, or any manner of sale or other
disposition of any Collateral for all or any of the Senior Debt or any
other assets of the Company or any of its subsidiaries;
(e) any change, restructuring or termination of the corporate structure or
existence of the Company or any of its subsidiaries; or
(f) any other circumstance which might otherwise constitute a defense
available to, or a discharge of, the Company, any Other Obligor or any
Subordinated Creditor.
This Agreement shall continue to be effective or be reinstated, as the case may
be, if at any time any payment of any of the Senior Debt is rescinded or must
otherwise be
returned by any Senior Party upon the insolvency, bankruptcy or reorganization
of the Company or any Other Party or otherwise, all as though such payment had
not been made.
14. Waiver. The Subordinated Creditors, the Company and the Other Obligors
each hereby waives promptness, diligence, notice of acceptance and any other
notice with respect to any of the Senior Debt and this Agreement and any
requirement that any Senior Party protect, secure, perfect or insure any
security interest or lien or any property subject thereto or exhaust any right
or take any action against the Company or the Other Obligors, or any other
person or entity or any collateral.
15. Representations and Warranties. Each Subordinated Creditor (or in the
case of subsection (e), the Company and each Other Obligor and not the
Subordinated Creditors) represents and warrants as follows:
(a) Such Subordinated Creditor (i) is duly organized, validly existing
and, where relevant, in good standing under the laws of the
jurisdiction of its incorporation or formation and (ii) has all
requisite corporate, limited liability company or partnership power
and authority (including, without limitation, all governmental
licenses, permits and other approvals) to enter into and perform this
Agreement.
(b) The execution, delivery and performance by such Subordinated Creditor
of this Agreement and the other transactions contemplated hereby have
been duly authorized by all necessary corporate, limited liability
company or partnership action and do not (i) contravene such
Subordinated Creditor's charter or bylaws or other constituent
agreements, (ii) violate any law, order, writ, judgment, injunction,
decree, determination or award to which such Subordinated Creditor is
subject or (iii) conflict with or result in the breach of, or
constitute a default under, any contract, loan agreement, indenture,
mortgage, deed of trust, lease or other instrument binding on or
affecting such Subordinated Creditor or any of its subsidiaries.
(c) No authorization or approval or other action by, and no notice to or
filing with, any governmental authority or regulatory body or any
other third party is required for the due execution, delivery or
performance by such Subordinated Creditor of this Agreement, excepting
those that have been obtained and are in full force and effect.
(d) This Agreement has been duly executed and delivered by such
Subordinated Creditor. This Agreement is the legal, valid and binding
obligation of such Subordinated Creditor, enforceable against such
Subordinated Creditor in accordance with its terms, except as the same
may be limited by bankruptcy, insolvency or similar laws affecting
creditors' rights generally or by general principles of equity.
(e) The Subordinated Debt now outstanding has been duly authorized by the
Company, and constitutes the legal, valid and binding obligation of
the Company enforceable against the Company in accordance with its
terms, except as the same may be limited by bankruptcy, insolvency or
similar laws affecting creditors' rights generally or by general
principles of equity. There exists no default in respect of any
Subordinated Debt or Subordinated Documents as of the date hereof. The
Company has delivered to the Senior Agent true and complete copies of
all agreements and instruments that evidence or govern the
Subordinated Debt, and such agreements and instruments have been duly
authorized, issued and delivered by the Company and each Other Obligor
and, as of the date hereof, have not been amended or modified from the
copies delivered to the Senior Agent.
(f) Such Subordinated Creditor is the legal and beneficial owner of the
Subordinated Debt now outstanding and owed to it, free and clear of
any lien, security interest, option or other charge or encumbrance.
(g) Such Subordinated Creditor has, independently and without reliance
upon any Senior Party and based on such documents and information as
it has deemed appropriate, made its own credit analysis and decision
to enter into this Agreement.
(h) Such Subordinated Creditor derives substantial direct and indirect
benefit in consideration for the execution of this Agreement.
16. Termination of Subordination. This Agreement shall continue in full
force and effect, and the obligations and agreements of the Subordinated
Creditors, the Company and the Other Obligors hereunder shall continue to be
fully operative, until all of the Senior Debt shall have been indefeasibly paid
and satisfied in full in cash. To the extent that the Company, any Other Obligor
or any guarantor of or provider of collateral for the Senior Debt makes any
payment on the Senior Debt that is subsequently invalidated, declared to be
fraudulent or preferential or set aside or is required to be repaid to a
trustee, receiver or any other party under any bankruptcy, insolvency or
reorganization act, state or federal law, common law or equitable cause (such
payment being hereinafter referred to as a "VOIDED PAYMENT"), then to the extent
of such Voided Payment, that portion of the Senior Debt that had been previously
satisfied by such Voided Payment shall be revived and continue in full force and
effect as if such Voided Payment had never been made. In the event that a Voided
Payment is recovered from the Senior Agent or any other Senior Party, an Event
of Default shall be deemed to have existed and to be continuing under the Credit
Agreement from the date of the initial receipt of such Voided Payment until the
full amount of such Voided Payment is restored to the Senior Agent or such other
Senior Party. During any continuance of any such Event of Default, this
Agreement shall be in full force and effect with respect to the Subordinated
Debt. To the extent that a Subordinated Creditor has received any payments with
respect to the Subordinated Debt subsequent to the date of the Senior Agent's or
any other Senior Party's initial receipt of such Voided Payment and such
payments have not been invalidated, declared to be fraudulent or preferential or
set aside and are not required to be repaid to a trustee, receiver, or any other
party under any bankruptcy act, state or federal law, common law or equitable
cause, such Subordinated Creditor shall be obligated and hereby agrees that any
such payment so made or received shall be deemed to have been received in trust
for the benefit of the Senior Agent or such other Senior Party, and such
Subordinated Creditor hereby agrees to pay to the Senior Agent for the benefit
of the Senior Agent or (as the case may be) such other Senior Party, upon
demand, the full amount so received by such Subordinated Creditor during such
period of time to the extent necessary fully to restore to the Senior Agent or
such other Senior Party the amount of such Voided Payment. Upon the payment and
satisfaction in full in cash of all of the Senior Debt, which payment shall be
final and not avoidable, this Agreement will automatically terminate without any
additional action by any party hereto.
17. Notices. All notices, requests and demands under this Agreement to be
effective shall be in writing (or by fax confirmed in writing) and shall be
deemed to have been duly given or made (a) when delivered by hand or (b) in the
case of an internationally recognized overnight courier service, two (2)
Business Days after delivery to such courier service or (c) if by fax, when sent
and receipt has been confirmed, addressed to the sender at its address or fax
number (as applicable) as set forth in Schedule 1 hereto or such other address
or fax number as any party hereto shall have designated by written notice to the
other parties hereto in accordance with this Section 17.
18. Amendments, Etc. No amendment or waiver of any provision of this
Agreement, and no consent to any departure by the Subordinated Creditors, the
Company or any Other Obligor herefrom, shall in any event be effective unless
the same shall be in writing and signed by the Senior Agent, the Company and
each Subordinated Creditor and then such waiver or consent shall be effective
only in the specific instance and for the specific purpose for which given.
19. Expenses. The Company and the Other Obligors jointly and severally (and
also, in the case of (b) and (c) only the relevant defaulting Subordinated
Creditor) agree upon demand to pay to the Senior Agent the amount of any and all
reasonable expenses, including the reasonable fees and expenses of its counsel
and of any experts or agents, which any Senior Party may incur in connection
with (a) the administration of this Agreement, (b) the exercise or enforcement
of any of the rights of any Senior Party hereunder or (c) the failure by the
Subordinated Creditors or the Company or any Other Obligor to perform or observe
any of the provisions hereof.
20. Consent to Jurisdiction, Etc. (a) Each of the parties hereto agrees
that any New York State court or Federal Court sitting in the City and County of
New York has jurisdiction to settle any disputes in connection with this
Agreement and accordingly submits to the jurisdiction of those courts. Each of
the parties hereto agrees that a final judgment in any such action or proceeding
shall be conclusive and may be enforced in other jurisdictions in which such
party or its assets may be located by suit on the judgment or in any other
manner provided by law. Nothing in this Agreement shall affect
any right that any party may otherwise have to bring any action or proceeding
relating to this Agreement in the courts of any jurisdiction.
(b) The Subordinated Guarantor hereby irrevocably appoints National
Corporate Research, Ltd. ("NCR") located at 000 X. 00xx Xxxxxx, Xxxxx 000, Xxx
Xxxx, XX 00000 (the "PROCESS AGENT") as its agent for service of process before
any courts located in the City and County of New York in connection with this
Agreement. The Subordinated Guarantor agrees that service may be made by mailing
(by a method requiring evidence of receipt) or delivering a copy of such process
to the Process Agent at its address set forth above, and the Subordinated
Guarantor hereby irrevocably authorizes and directs the Process Agent to accept
such service on its behalf. As an alternative method of service, the Company,
each Other Obligor and each Subordinated Creditor also irrevocably consents to
the service of any and all process in any such action or proceeding by sending
copies of such process by mail (by a method requiring evidence of receipt) with
a second copy to be sent by courier to the Company or such Other Obligor or
Subordinated Creditor being served at its address specified in Section 17.
(c) Each of the parties hereto irrevocably and unconditionally waives, to
the fullest extent it may legally and effectively do so, any objection that it
may now or hereafter have to the laying of venue of any suit, action or
proceeding arising out of or relating to this Agreement in any New York State or
Federal court sitting in the City and County of New York. Each of the parties
hereto hereby irrevocably waives, to the fullest extent permitted by law, the
defense of an inconvenient forum to the maintenance of such action or proceeding
in any such court.
21. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND INTERPRETED IN
ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICT OF
LAWS PRINCIPLES (OTHER THAN SECTIONS 5-1401 AND 5-1402 OF THE NEW YORK GENERAL
OBLIGATIONS LAW) THEREOF.
22. Waiver of Jury Trial. EACH PARTY HERETO HEREBY WAIVES ITS RIGHT TO A
JURY TRIAL WITH RESPECT TO ANY ACTION OR CLAIM ARISING OUT OF, UNDER OR IN
CONNECTION WITH ANY DISPUTE WITH RESPECT TO THIS AGREEMENT, ANY RIGHTS OR
OBLIGATIONS HEREUNDER OR THE PERFORMANCE OF SUCH RIGHTS AND OBLIGATIONS. Each of
the Subordinated Creditors, the Other Obligors and the Company hereby waives any
right which it may have to claim or recover in any litigation referred to in the
preceding sentence any special, exemplary, punitive or consequential damages or
any damages other than, or in addition to, actual damages. Each of the
Subordinated Creditors, the Other Obligors and the Company (a) certifies that no
representative, agent or attorney of any Subordinated Creditor, the Other
Obligors or the Company, as applicable, has represented, expressly or otherwise,
that such Subordinated Creditor, Other Obligor or the Company, as applicable,
would not, in the event of litigation, seek to enforce the foregoing waivers and
(b) acknowledges that the Senior Parties have been induced to enter into this
Agreement and the Credit Agreement by, among other things, the waivers and
certifications contained herein.
23. Miscellaneous. This Agreement may be executed in several counterparts
and by each party on a separate counterpart, each of which when so executed and
delivered shall be an original, and all of which together shall constitute one
instrument. This Agreement shall have effect notwithstanding that one or more
parties may not have executed it. In proving this Agreement, it shall not be
necessary to produce or account for more than one such counterpart signed by the
party against which enforcement is sought. In the event and to the extent that
any provision of this Agreement shall be held invalid or unenforceable, such
invalidity or unenforceability shall not affect the validity or enforceability
of any other provisions of this Agreement, all of which shall remain fully
enforceable as set forth herein. The Senior Agent, acting upon the instructions
of the requisite Senior Parties, may, in its sole and absolute discretion, waive
any provisions of this Agreement benefiting the Senior Agent and the other
Senior Parties; provided, however, that such waiver shall be effective only if
in writing and signed by the Senior Agent and shall be limited to the specific
provision or provisions expressly so waived. No failure on the part of any
Senior Party to exercise, and no delay in exercising, any right hereunder shall
operate as a waiver thereof; nor shall any single or partial exercise of any
right hereunder preclude any other or further exercise thereof or the exercise
of any other right. The remedies herein provided are cumulative and not
exclusive of any remedies provided by law. This Agreement is a continuing
agreement of subordination and shall (a) remain in full force and effect until
the indefeasible payment in full in cash of the Senior Debt, (b) be binding upon
the Subordinated Creditors, the Company, the Other Obligors and their respective
successors and assigns and (c) inure to the benefit of, and be enforceable by,
the Senior Agent and the other Senior Parties, the Senior Agent's and the other
Senior Parties' respective successors and permitted assigns, but shall not
otherwise create any rights or benefits for any third party. Without limiting
the generality of the foregoing clause (c), any Senior Party may assign or
otherwise transfer all or any portion of its rights and obligations under any
Credit Document to which it is a party (including, without limitation, all or
any portion of any Senior Debt held by it) to any other person or entity in
accordance with the terms of such Credit Document, and such other person or
entity shall thereupon become vested with all the rights in respect thereof
granted to such Senior Party herein or otherwise, subject, however, to any
applicable limitations set forth in such Credit Document.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first above written.
COMPANY:
NAVISITE, INC.
By: /s/ Xxxx X. Xxxxx, Xx.
------------------------------------
Name: Xxxx X. Xxxxx, Xx.
Title: CFO
OTHER OBLIGORS:
AVASTA, INC.
CLEARBLUE TECHNOLOGIES MANAGEMENT, INC.
CLEARBLUE TECHNOLOGIES/ CHICAGO-XXXXX,
INC.
CLEAR BLUE TECHNOLOGIES/LAS VEGAS, INC.
CLEARBLUE TECHNOLOGIES/LOS ANGELES, INC.
CLEARBLUE TECHNOLOGIES/ MILWAUKEE, INC.
CLEARBLUE TECHNOLOGIES/OAK BROOK, INC.
CLEARBLUE TECHNOLOGIES/ VIENNA, INC.
By: /s/ Xxxx X. Xxxxx, Xx.
------------------------------------
Name: Xxxx X. Xxxxx, Xx.
Title: CFO
CLEARBLUE TECHNOLOGIES/
DALLAS, INC.
By: /s/ Xxxx X. Xxxxx, Xx.
------------------------------------
Name: Xxxx X. Xxxxx, Xx.
Title: CFO
CLEARBLUE TECHNOLOGIES/NEW YORK, INC.
By: /s/ Xxxx X. Xxxxx, Xx.
------------------------------------
Name: Xxxx X. Xxxxx, Xx.
Title: CFO
CLEARBLUE TECHNOLOGIES/SAN FRANCISCO,
INC.
By: /s/ Xxxx X. Xxxxx, Xx.
------------------------------------
Name: Xxxx X. Xxxxx, Xx.
Title: CFO
CLEARBLUE TECHNOLOGIES/SANTA XXXXX, INC.
By: /s/ Xxxx X. Xxxxx, Xx.
------------------------------------
Name: Xxxx X. Xxxxx, Xx.
Title: CFO
CONXION CORPORATION
By: /s/ Xxxx X. Xxxxx, Xx.
------------------------------------
Name: Xxxx X. Xxxxx, Xx.
Title: CFO
INTREPID ACQUISITION CORP.
By: /s/ Xxxx X. Xxxxx, Xx.
------------------------------------
Name: Xxxx X. Xxxxx, Xx.
Title: CFO
LEXINGTON ACQUISITION CORP.
By: /s/ Xxxx X. Xxxxx, Xx.
------------------------------------
Name: Xxxx X. Xxxxx, Xx.
Title: CFO
XXXXXXXXXX.XXX, INC.
By: /s/ Xxxx X. Xxxxx, Xx.
------------------------------------
Name: Xxxx X. Xxxxx, Xx.
Title: CFO
SUREBRIDGE ACQUISITION CORP.
By: /s/ Xxxx X. Xxxxx, Xx.
------------------------------------
Name: Xxxx X. Xxxxx, Xx.
Title: CFO
SUREBRIDGE SERVICES, INC.
By: /s/ Xxxx X. Xxxxx, Xx.
------------------------------------
Name: Xxxx X. Xxxxx, Xx.
Title: CFO
SITEROCK CORPORATION
By: /s/ Xxxx X. Xxxxx, Xx.
------------------------------------
Name: Xxxx X. Xxxxx, Xx.
Title: CFO
NAVISITE ACQUISITION CORP.
By: /s/ Xxxx X. Xxxxx, Xx.
------------------------------------
Name: Xxxx X. Xxxxx, Xx.
Title: CFO
CLICKHEAR, INC.
By: /s/ Xxxx X. Xxxxx, Xx.
------------------------------------
Name: Xxxx X. Xxxxx, Xx.
Title: CFO
SENIOR AGENT:
SILVER POINT FINANCE, LLC
By: /s/ Xxxxxxx Xxxxxxxx
------------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: Authorized Signatory
SUBORDINATED CREDITORS:
ATLANTIC INVESTORS, LLC
By: /s/ X. X. XxXxxxx
------------------------------------
X. X. XxXxxxx
Director
UNICORN WORLDWIDE HOLDINGS LIMITED
By: /s/ X. X. XxXxxxx
------------------------------------
X. X. XxXxxxx
Director
