EXHIBIT 10.8(d)
INTERCREDITOR AGREEMENT
This INTERCREDITOR AGREEMENT (as amended, restated or modified from time to
time, the "ICA") is dated as of September 7, 2004, and made by and among
0000-0000 Xxxxxx, Inc., a Province of Quebec, Canada, corporation, whose place
of business is in Xxxxx, Xxxxxx, Xxxxxx ("Lender"), PSC Equipment, Inc., a
Florida corporation ("Subordinator"), and On Alert Systems, Inc., a Nevada
corporation ("Borrower").
RECITALS
WHEREAS, Borrower has executed and delivered to Lender a promissory note
dated as of August 23, 2004, currently in the aggregate original principal sum
of Two Hundred Forty-two Thousand Two Hundred Sixteen dollars ($242,216) (the
"Note"); and.
WHEREAS, Borrower has executed and delivered to Subordinator Amendment #1
to the Money Purchase Contract ("MPC") dated May 31, 2004, dated July 28th,
2004, herewith; and,
WHEREAS, Lender, Subordinator and Borrower desire to enter into this ICA so
as to define the terms and manner in which both the Lender and the Subordinator,
as separate Lien (defined pursuant to Section 1, below) holders on certain
portions of the Collateral (defined pursuant to Section 1, below), may cooperate
with each other to maximize the value to be realized in the event of a
liquidation of any Equipment portion of the Collateral; and,
WHEREAS, Lender, Subordinator and Borrower now desire to enter into this
ICA for any other purposes set forth herein,
AGREEMENTS
NOW, therefore, in consideration of the foregoing, the covenants contained
herein, and other good and valuable consideration, the receipt and sufficiency
of which are herein acknowledged, Lender, Subordinator and Borrower hereby agree
as follows:
Section 1. Subordination.
(a) The capitalized terms used in this Agreement shall have the following
meanings:
(i) "Lien" means any mortgage, deed of trust, pledge, hypothecation,
assignment, deposit, arrangement, security interest, encumbrance, lien
(statutory or other and including without limitation, any attachment,
levy, or judgment lien), preference, priority, or other security
interest or agreement or other preferential arrangement whatsoever,
including, without limitation, the filing of any financing statement
naming the owner of the asset to which such Lien relates as debtor.
(ii) "Collateral" means all tangible and intangible personal property
acquired by Lender from Subordinator pursuant to the Promissory Note
dated August 23, 2004, or by the Borrower from the Subordinator,
pursuant to that certain Equipment Purchase Agreement dated as of May
31, 2004, inclusive of any Amendments in force as of this date, among
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Subordinator, PSC Equipment, Inc. (as the same may have been or may
hereafter be amended, supplemented, restated or replaced, the
"Purchase Agreement"), and all accessions, appurtenances and additions
to and substitutions for any of the foregoing and all products and
proceeds of any of the foregoing, together with all renewals and
replacements of any of the foregoing, all instruments, notes, chattel
paper, documents (including all documents of title), books, records,
contract rights and general intangibles arising in connection with any
of the foregoing (including all insurance and claims for insurance
affected or held for the benefit of Lender or Subordinator in respect
of the foregoing) and together with all general intangibles now owned
by Lender or existing or hereafter acquired, created or arising,
related to any of the foregoing property as defined or pursuant to
terms agreed to in the Note.
(b) Unless and until the Lender has been repaid the sum of $242,216 in
principal and any accrued interest, default interest and, as applicable, any
other costs or penalties pursuant to the Note, Lender shall have a first and
prior Lien in the Collateral and all proceeds thereof. To the extent that the
Lender and Subordinator hold Liens covering the same portion of the Collateral,
any Lien in the Collateral by the Lender shall be, and is, senior and superior
to all Liens in the Collateral held by the Subordinator.
(c) Unless and until the Subordinator has been repaid the sum of $150,000
in principal and any accrued interest, default interest and, as applicable, any
other costs or penalties pursuant to the MPC, and the Subordination Fee,
Subordinator shall have a first and prior Lien in the Collateral and all
proceeds thereof subsequent to the payment to the Lender of all sums due to the
Lender pursuant to the Note and Section 1 (c) above. To the extent that the
Lender and Subordinator hold Liens covering the same portion of the Collateral,
any Lien in the Collateral by the Lender, once paid in full, shall be null and
void, and any Lien of the Subordinator shall be senior and superior to all Liens
in the Collateral held by any other entity or individual.
Section 2. Obligations of Subordinator and Lender Upon Exercise of the Default
Provisions of the Note by the Lender to enforce the Lender's rights in regards
to the Equipment of the Borrower pledged as Collateral in the Note (the
"Equipment Collateral"). Upon the exercise by the Lender of the Default
Provisions of the Note to enforce the Lender's rights in regards to the
Equipment Collateral, Lender covenants and agrees that he will cooperate with
the parties to the EPA and take such action as is reasonably required of it, at
the Borrower's expense, to facilitate the liquidation of the Equipment
Collateral through the resale services of the Subordinator, as principals or
agents, for the purpose of maximizing the value of the proceeds of such
liquidation, so as to protect both the Lender's interests and the interests of
the Subordinator. Such action shall include, but shall not be limited to (a)
permitting the transfers of such assets to the Subordinator, subject to the Lien
of the Lender, as may be contemplated by the provisions of the EPA or MPC, for
the purposes of resale to third parties, and (b) as to any asset to be
transferred to the Subordinator or Lender, releasing or obtaining the release of
any and all Liens on such assets in favor of Lender or any other creditor having
a secured interest in such assets under any of the loan documents relating to
Lender's Liens, inclusive of the Liens of the Subordinator. Neither the
Subordinator nor the Lender will be permitted to resell any Equipment Collateral
without the express written consent of the each other, which consent shall not
be unduly withheld, with the proceeds of such sales first paid to the Lender
until such proceeds equal the amount due to the Lender pursuant to the Note.
Once the Lender is paid in full, the Subordinator may sell or retain any
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Equipment Collateral, at its option, pursuant to the EPA and MPC. Subordinator
agrees to use its best good faith efforts to identify purchasers of such
Equipment Collateral in a commercially reasonable period of time so as to
maximize value of the proceeds of liquidation to the Lender and the
Subordinator. Lender agrees that Subordinator, who is in the resale of equipment
business, is more likely to identify purchasers of the Equipment Collateral so
liquidated than is the Lender, and hereby grants the Subordinator a commercially
reasonable time to complete such resale. In the event that the Subordinator, for
any reason, is unable to consummate a sale in a commercially reasonable time,
the Subordinator shall provide to the Lender a list of at least ten (10)
qualified equipment resellers who are capable of reselling the Equipment
Collateral at the highest and best value that can be obtained at the time of the
resale, and the Lender shall choose appropriate representatives from such list.
Section 3. Obligations of Lender Upon Exercise of the Subordinators Option to
Unwind the Transactions Giving Rise to the Repossession of the Equipment
pursuant to the EPA. Upon the exercise by the Subordinator of the option to
unwind the transactions giving rise to the repossession of the Equipment
pursuant to the EPA, Lender covenants and agrees that he will cooperate with the
parties to the EPA and take such action as is reasonably required of it, at the
Borrower's expense, to facilitate the unwinding of the transaction as provided
for in the EPA. Such action shall include, but shall not be limited to (a)
permitting the transfers of such assets to the Subordinator, subject to the Lien
of the Lender, as may be contemplated by the provisions of the EPA or MPC, to
satisfy the terms of the Note, and (b) as to any asset to be transferred to the
Subordinator or Lender, releasing or obtaining the release of any and all Liens
on such assets in favor of Lender or any other creditor having a secured
interest in such assets under any of the loan documents relating to Lender's
Liens, inclusive of the Liens of the Subordinator.
Section 4. Notice to Subordinator by Lender and Obligations of Subordinator Upon
Notice. Lender shall provide written notice to the Subordinator of its intention
to enforce the Default Provisions of the Note coincident with its Notice to the
Borrower. Subordinator shall cooperate with the Lender in all matters relating
to the Equipment Collateral so as to timely accommodate the liquidation of the
Equipment Collateral to the extent necessary to repay the Lender in full
pursuant to its Note, and to maximize value to the Lender and the Subordinator
within the shortest commercially feasible timeframe and by the sale of the least
amount of Equipment Collateral as is reasonably possible at the time of the
liquidation resale's. Neither the Subordinator nor the Lender shall take any
action involving the liquidation of the Equipment Collateral, which would impair
the ability of the Subordinator or the Lender to protect its Liens in the
Equipment Collateral or that would jeopardize, in a commercially reasonable
timeframe and manner of resale, the value to be derived by either party.
Section 5. Conflicts. In the event of any conflict between (i) the provisions of
this ICA, and (ii) the provisions of either of the Note or the MPC, inclusive of
its Amendment #1, the provisions of this ICA shall govern, to the extent that
such conflict is specific and is governable by this ICA.
Section 6. Amendments; Waivers. No amendment, modification, or waiver of any of
the provisions of this ICA by Lender or Subordinator shall be deemed to be made
unless the same shall be in writing signed on behalf of the party making such
waiver and any such waiver shall be a waiver only with respect to the specific
instance involved and shall in no way impair the rights of the party making such
waiver or, unless otherwise agreed, the obligations of the other party to such
party in any other respect or at any other time.
Section 7. Governing Law. This ICA shall be governed by the laws of the State of
Florida.
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Section 8. Notices. All notices to Lender, Subordinator or Borrower under this
ICA shall be sent to Lender, Subordinator or Borrower at the address given
beneath its signature to this ICA, or, as to each party, at such other address
as may be designated by such party in a written notice to the other party.
Unless otherwise specifically provided herein, any notice or other communication
herein required or permitted to be given shall be in writing and may be
personally served, or sent by recognized commercial overnight courier service
and shall be deemed to have been given when delivered in person, or one (1)
business day after delivery to such courier service with charges prepaid and
properly addressed.
Section 9. Counterparts. This ICA maybe executed in one or more counterparts,
each of which shall be an original and all of which shall together constitute
one and the same document.
Section 10. Successors and Assigns. The terms of this ICA shall apply to, be
binding upon, and inure to the benefit of the parties hereto, their successors,
assigns and legal representatives, and all other persons claiming by, through,
and under them.
EXECUTED as of the date first above written.
LENDER: 9145-6442 Quebec, Inc.
Attorney in fact for the Corporation, Xxxx X. Xxxxxxxxxx, Esq. Under
Limited power of attorney dated August 19, 2004
Address for Notice: 0000-0000 Xxxxxx, Inc.
Attn: Bureau 400
0000 Xxxxxxxxx Xxxxxx Xxxxxxx, Xxxxx 000 Xxxxx, Xxxxxx, Xxxxxx, X0X0X0
With a copy to: Xxxx X. Xxxxxxxxxx, Esq.
0000 Xxxxxxxx Xxxxx Xx., Xxxxx
Xxxxxxxxxx, Xx. 00000
Fax 000-000-0000
SUBORDINATOR:
PSC Equipment, Inc.
By: /s/ Xxxxxxx Xxxxxxx
---------------------------------
Name: Xxxxxxx Xxxxxxx
Title: President
Address for Notice:
SearchPro Corporation, Agent for PSC Equipment, Inc.
0000 Xxxx Xxxxxxx Xxxx Xxxx., #000
Xxxx Xxxxxxxxxx, Xx. 33306
Fax- 000-000-0000
BORROWER:
On Alert Systems, Inc.
By: /s/ Xxxxxxx Xxxxxxxx
---------------------------------
Name: Xxxxxxx Xxxxxxxx
Title: President
Address for Notice:
0000 Xxxxx Xxxxxxx, Xxxxx 000,
Xxxxx, Xx. 00000
Fax 000-000-0000
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