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EXHIBIT 10.1
AGREEMENT TO EFFECT ORDERLY LIQUIDATION
OF MESSAGEMEDIA EUROPE, B.V.
BY AND BETWEEN MESSAGEMEDIA EUROPE, B.V.,
MESSAGEMEDIA, INC.,
MESSAGEMEDIA US/EUROPE, INC. AND
@viso LIMITED
DATED MAY 9, 2001
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AGREEMENT TO EFFECT ORDERLY LIQUIDATION OF MESSAGEMEDIA EUROPE, B.V., a
Netherlands corporation (together with its subsidiaries, the "JOINT VENTURE"),
dated May 9, 2001, by and between the JOINT VENTURE, MESSAGEMEDIA, INC., a
Delaware corporation ("MESSAGEMEDIA US"), MESSAGEMEDIA US/EUROPE, INC., a
Delaware corporation wholly-owned by MessageMedia US ("MESSAGEMEDIA SUB," and,
collectively with MessageMedia US, "MESSAGEMEDIA"), and @VISO LIMITED, a company
incorporated under the laws of England and Wales ("@viso") (this "AGREEMENT").
WHEREAS, MessageMedia, MessageMedia Sub and @viso are parties to that
certain Shareholders Agreement, dated March 7, 2000, pursuant to which they are
associated as shareholders of the Joint Venture (the "SHAREHOLDERS AGREEMENT");
WHEREAS, MessageMedia US and the Joint Venture are parties to that
certain Master License and Services Agreement, dated March 10, 2000, referred to
in Section 1(c) of the Shareholders Agreement (the "LICENSE AGREEMENT");
WHEREAS, @viso and the Joint Venture are parties to that certain Credit
Agreement, referred to in Section 1(d) of the Shareholders Agreement (the
"CREDIT AGREEMENT");
WHEREAS, MessageMedia US and @viso are parties to that certain Loan
Agreement, dated March 7, 2000, referred to in Section 1(e) of the Shareholders
Agreement (the "LOAN AGREEMENT");
WHEREAS, the Joint Venture, MessageMedia and @viso desire to effect the
orderly liquidation of the Joint Venture, and to terminate the Shareholders
Agreement, License Agreement, Credit Agreement and Loan Agreement, to the extent
and upon the terms and conditions hereinafter set forth.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein set forth, the parties hereby agree as follows:
1. INITIAL PAYMENTS.
(a) No later than May 11, 2001 (the "FUNDING DATE"), @viso will
contribute to the Joint Venture $2,000,000 (US dollars) (the "@viso CONTRIBUTED
AMOUNT") by wire transfer of immediately available funds to an account
designated by the Joint Venture, which funds shall be used to satisfy (i) all
creditors' and employees' claims of the Joint Venture and any accounting, audit
or legal fees and expenses incurred by the Joint Venture in connection with its
shut down and liquidation, (ii) that certain e1,239,393 (euros) obligation due
@viso by the Joint Venture as a result of services provided to the Joint Venture
by @viso pursuant to Section 2(d) of the Shareholders Agreement, and (iii) all
reimbursable expenses and monthly license and support fees earned by
MessageMedia US through the date hereof pursuant to the License Agreement, but
excluding: (x) any and all severance payments due Xxxxx Xxxxxxxxx, the Chief
Executive Officer of the Joint Venture, (y) obligations due pursuant to that
certain $5,300,000 promissory note, issued in March 2000 and used by the Joint
Venture to purchase technology pursuant to Section 1.29 of the License Agreement
(the "$5,300,000 NOTE"), and (z) any and all expenses, costs, fees or other
obligations not specifically identified above due either to @viso or
MessageMedia US (hereafter these claims, obligations, expenses and fees,
including those
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referred to in (i), (ii) and (iii) above, but excluding those referred to in
(x), (y) and (z) above, shall be referred to as the "SHUTDOWN COSTS").
(b) On the Funding Date, @viso will loan MessageMedia US $2,000,000
(the "MESSAGEMEDIA CONTRIBUTED AMOUNT" and, collectively with the @viso
Contributed Amount, the "CONTRIBUTED AMOUNTS"), pursuant to the terms of the
MessageMedia Contributed Amount Note attached hereto as Exhibit A (the
"CONTRIBUTED AMOUNT NOTE"), which funds concurrently shall be contributed by
MessageMedia US to the Joint Venture by a direct wire transfer of immediately
available funds from @viso to an account designated by the Joint Venture and be
used exclusively to fund the Shutdown Costs. In the event that the Contributed
Amounts exceed the Shutdown Costs (the "EXCESS CONTRIBUTED AMOUNTS"),
concurrently with the liquidation of the Joint Venture, the Joint Venture shall
distribute the Excess Contributed Amounts to @viso by wire transfer of
immediately available funds to an account designated by @viso; provided,
however, that 50% of such Excess Contributed Amounts shall be applied to the
principal amount at the time outstanding under the Contributed Amount Note,
which principal amount correspondingly shall be reduced (as set forth in such
note).
(c) On the Funding Date, in consideration of the termination, release
and cancellation of the Loan Agreement, as set forth in Section 3(c) below,
MessageMedia US will issue @viso a promissory note with a principal amount of
$2,500,000 (the "TERMINATION NOTE"), the form of which is attached hereto as
Exhibit B.
2. REPRESENTATIONS AND WARRANTIES.
Each of MessageMedia US and @viso hereby represents and warrants to the
other as follows:
(a) It is a company duly organized, validly existing and in good
standing under the laws of its jurisdiction of incorporation, with full power
and authority to enter into and perform this Agreement.
(b) No consent, approval or authorization of, or declaration or filing
with, any governmental authority or person or entity is required on its part in
connection with the execution and performance of this Agreement.
(c) The execution and delivery of this Agreement and the performance of
its obligations hereunder will not (i) violate or be in conflict with any
provision of law, any order, rule or regulation of any court or other agency of
government, or any provision of its charter or bylaws, or (ii) violate, be in
conflict with, result in a breach of, or constitute a default under any material
indenture, license, lease, agreement or other instrument to which it is a party
or by which it or any of its properties is bound.
3. TERMINATION OF AGREEMENTS.
(a) TERMINATION OF CREDIT AGREEMENT. Effective as of the receipt by the
Joint Venture of the Contributed Amounts, the Credit Agreement shall terminate
and be of no further force or effect and all liabilities and claims thereunder
forever shall be discharged and released.
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(b) TERMINATION OF SHAREHOLDERS AGREEMENT. Effective as of the receipt
by the Joint Venture of the Contributed Amounts, the Shareholders Agreement
shall terminate and be of no further force or effect and all liabilities and
claims thereunder forever shall be discharged and released.
(c) TERMINATION OF LOAN AGREEMENT. Effective upon the issuance of the
Termination Note by MessageMedia US to @viso, the Loan Agreement shall terminate
and be of no further force or effect and all liabilities and claims thereunder
forever shall be discharged and released.
(d) TERMINATION OF LICENSE AGREEMENT AND RELEASE OF $5,300,000
PROMISSORY NOTE. Effective as of the receipt by the Joint Venture of the
Contributed Amounts, the License Agreement shall terminate and be of no further
force or effect and all liabilities and claims thereunder forever shall be
discharged and released, including, without limitation, the $5,300,000 Note;
provided, however, that, MessageMedia US shall be entitled to recover in the
liquidation of the Joint Venture the amounts referred to in Section 1(a)(iii)
above.
4. MUTUAL RELEASE.
Except otherwise as set forth immediately below and otherwise in this
Agreement, and excluding the obligations created pursuant to the Termination
Note and the Contributed Amount Note, effective as of the receipt by the Joint
Venture of the Contributed Amounts, each of the parties hereto hereby releases,
acquits and forever discharges the other party, including such other party's
current and former officers, directors, agents, servants, employees,
stockholders, attorneys, successors, assigns and affiliates, of and from any and
all claims, liabilities, demands, causes of action, costs, expenses, attorneys'
fees, damages, indemnities and obligations of every kind and nature, in law,
equity or otherwise, known and unknown, suspected and unsuspected, disclosed and
undisclosed, arising out of or in any way related to agreements, events, acts or
conduct occurring at any time prior to and including the date of this Agreement,
including, without limitation, any and all claims and demands directly or
indirectly arising out of or in any way connected with the execution and
negotiation of this Agreement (or any related agreement) or the Shareholders
Agreement, or with regard to forming and operating the Joint Venture. If any
party has filed any claim, complaint, or charge against any party indemnified
hereunder before any local, state, federal or foreign administrative body or
court, such party agrees to dismiss with prejudice such claim, complaint, or
charge, and to send confirmation of dismissal to such other party within 14 days
after the date of this Agreement. Each party agrees that in the event it brings
a claim or charge covered by this release or does not dismiss and withdraw any
claim covered by this release in which such party seeks damages or any other
relief against any other party indemnified hereunder, this Agreement shall serve
as a complete defense to such claim or charge.
5. ASSUMPTION OF CERTAIN JOINT VENTURE ASSETS/SEVERANCE COSTS.
(a) MessageMedia US shall have the right to assume any and all of the
Joint Venture's customer contracts, including, without limitation, any contract
by and between the Joint Venture and Vivendi Universal S.A. ("VIVENDI") or any
affiliate or non-wholly owned subsidiary of Vivendi. If MessageMedia US, in its
sole discretion, elects to assume any contract
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by and between the Joint Venture and Vivendi or any affiliate or non-wholly
owned subsidiary of Vivendi, it also shall assume any and all obligations
imposed by the terms and conditions of such contract.
(b) MessageMedia US shall have the right to hire any personnel of the
Joint Venture required to service such assumed customers, and shall provide
@viso with a list of the key Joint Venture personnel it intends to hire, and
shall use commercially reasonable effort to provide such list on or before May
31, 2001, and, in any event, shall do so prior to the final liquidation of the
Joint Venture.
(c) Notwithstanding anything in this Section 5 to the contrary, without
the written consent of @viso, the Joint Venture shall not in any way be
restricted from proceeding with its shut down and liquidation to accommodate the
assumption of such customer contracts or the hiring of such personnel.
(d) MessageMedia US agrees to pay all costs which directly result from
the assignment of such Joint Venture customer contracts in accordance with local
laws, including, without limitation, any transfer tax associated with such
assignment, but excluding any operational costs of the Joint Venture (which
include any labor or employment costs of the Joint Venture).
(e) MessageMedia shall use commercially reasonable efforts to reassign
to an appropriate position rather than terminate any employee of the Joint
Venture who as of the time immediately prior to such termination MessageMedia
intends to retain as a future employee of the Joint Venture or MessageMedia. In
addition, Message Media US agrees to reimburse @ viso for any severance expenses
incurred by @viso in connection with terminating any Joint Venture employee who
MessageMedia or the Joint Venture shall rehire after such severance expense has
been incurred.
(f) MessageMedia US agrees to hold harmless and indemnify @viso,
including @viso's current and former officers, directors, agents, servants,
employees, stockholders, attorneys, successors, assigns and affiliates (the
"@viso INDEMNITEES"), against any and all expenses that the @viso Indemnitees
become legally obligated to pay because of any claims, liabilities, demands or
causes of action, in law, equity or otherwise, arising out of acts or conduct of
MessageMedia relating to the performance or alleged non-performance of one or
more of such assumed contracts and occurring after the date on which
MessageMedia US assumes the Joint Venture customer contract that is the subject
of such claim, liability, demand or cause of action.
6. SELECTION OF PERSONNEL.
@viso and MessageMedia US agree that they mutually shall select the
personnel responsible for the shut down and liquidation of the Joint Venture.
7. CONFIDENTIALITY/NON-DISCLOSURE.
Each of the parties acknowledges that confidentiality and nondisclosure
are material considerations for the parties entering into this Agreement. As
such, each of the parties agree not to publicize nor to disclose the existence
or the terms of this Agreement with any individual in
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any manner whatsoever, written or oral, including, but not limited to, the print
or broadcast media, any public network such as the Internet, any other outbound
data program such as computer generated mail, reports or faxes, or any source
likely to result in publication or computerized access. Notwithstanding the
prohibitions in this paragraph, the parties may disclose this Agreement: (a) in
confidence to their respective attorneys, spouses, accountants, auditors, tax
preparers, insurance carrier, and financial advisors; (b) as necessary to
fulfill standard or legally required corporate reporting, disclosure
requirements or financing requirements; (c) upon request from any government
entity; (d) to investors or potential investors, purchasers or potential
purchasers, successors and potential successors, and any current or prospective
parent corporation; and (e) insofar as such disclosure may be necessary to
enforce its terms or otherwise as required by law.
8. MESSAGEMEDIA US CHANGE OF CONTROL PREMIUM PAYABLE TO @VISO.
As additional consideration for the obligations of the parties hereto,
MessageMedia US agrees that if there shall occur a "change of control" (as
defined in the Contributed Amount Note) of MessageMedia US that is consummated
on or before December 31, 2003, concurrently with the consummation of such
change of control, MessageMedia US shall make a cash payment to @viso in an
amount based upon the following formula:
Y = A x B x ((C - D) / D)
where:
Y = the cash payment to @viso;
A = 0.5;
B = the sum of the principal amounts outstanding under the Contributed
Amount Note and the Termination Note as of immediately prior to the
time such change of control is consummated;
C = the fair value of the consideration per share (as defined below) paid
to MessageMedia US stockholders in connection with such change of
control; and
D = the closing market price of MessageMedia US common stock as quoted on
the Nasdaq Market as of the date hereof (as adjusted for any stock
splits, combinations or dividends effected after the date hereof);
provided, further, that the quotient of ((C - D) / D) shall in no event
exceed 0.25.
The fair value of the consideration paid per share, if the
consideration received by MessageMedia US stockholders is other than cash, will
be deemed its fair market value as determined in good faith by the Board of
Directors of MessageMedia US; provided, however, any securities shall be valued
as follows:
(a) Securities not subject to investment letter or other similar
restrictions on free marketability covered by (b) below:
(i) if traded on a securities exchange or through the Nasdaq
National Market, the value shall be deemed to be the average of the closing
prices of the securities on such
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quotation system over the 30 day period ending three days prior to the
consummation of the change of control;
(ii) if actively traded over-the-counter, the value shall be
deemed to be the average of the closing bid or sale prices (whichever is
applicable) over the 30 day period ending three days prior to the consummation
of the change of control; and
(iii) if there is no active public market, the value shall be
the fair market value thereof, as determined in good faith by the Board of
Directors of MessageMedia US.
(b) The method of valuation of securities subject to investment letter
or other restrictions on free marketability (other than restrictions arising
solely by virtue of a stockholder's status as an affiliate or former affiliate)
shall be to make an appropriate discount from the market value determined as
above in (a)(i), (ii) or (iii) to reflect the approximate fair market value
thereof, as determined in good faith by the Board of Directors of MessageMedia
US.
9. MISCELLANEOUS.
(a) All the terms and provisions of this Agreement shall be binding
upon and inure to the benefit of and be enforceable by the respective successors
and assigns of the parties hereto except as otherwise expressly limited herein.
(b) Each party shall bear its own costs incurred in the negotiations
and preparation of this Agreement and of matters incidental thereto.
(c) All notices, requests, demands and other communications hereunder
shall be in writing and shall be deemed to have been duly given if delivered or
mailed, first-class airmail, postage prepaid:
To MessageMedia: 000 Xxxxxxxxxx Xxxxxxx
Xxxxxxxxxx, XX 00000
Attention: A. Xxxxxxxx Xxxxx, President
and Chief Executive Officer
Telephone: 000-000-0000
Fax: 000-000-0000
With a copy to: Xxxxxx Godward LLP
000 Xxxxxxxxxxx Xxxxxxxx, Xxxxx 000
Xxxxxxxxxx, XX 00000-0000
Attention: Xxxxxxx Xxxxx, Esq.
Telephone: 000-000-0000
Fax: 000-000-0000
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To @viso: @viso Limited
c/o Macfarlanes
00 Xxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Xxxxxxx
Attention: Xxxxxxx Xxxxxx
Telephone: 00-000-000-0000
Fax: 00-000-000-0000
With a copy to: Xxxxxx, Xxxxxx & Xxxxxxxx
00, xxx xx Xxxxxxx
00000 Xxxxx, Xxxxxx
Attention: Xxxxxx Xxxx
Telephone: 00-000-00-0000
Fax: 00 (0) 00 00 00 00
To the Joint Venture: MessageMedia Europe, B.V.
Le Richelieu
00, xxx xxx Xxxxx Xxxxxxxx
Xxxxxxxx xx Xxxxxxxxx
00000 Nanterre Cedex
Telephone: 00-000-00-0000
Fax: 00-000-00-0000
With a copy to: MessageMedia, Inc. and Xxxxxx Godward LLP,
as set forth above
or, in each case, to such other address as the party may have furnished to the
other party in writing.
(d) In the event of the invalidity of any part or provision of this
Agreement, such invalidity shall not affect the enforceability of any other part
or provision of this Agreement.
(e) No waiver by any party or any default in the strict performance of
or compliance with any provision herein shall be deemed to be a waiver of
performance and compliance as to any other provision in the future; nor shall
any delay or omission of any party to exercise any right hereunder in any manner
impair the exercise of any such right accruing to it thereafter. No remedy
expressly granted herein to any party shall be deemed to exclude any other
remedies which otherwise would be available.
(f) This Agreement constitutes the entire agreement between the parties
with respect to the subject matter hereof and supersedes all prior
understandings and agreements between the parties with respect to such subject
matter. The parties hereto agree to vote their shares in the
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Joint Venture to give effect to this Agreement and, in the event of a conflict
between this Agreement and the Articles of Association of the Joint Venture, the
provisions of this Agreement shall prevail. If the implementation or performance
of this Agreement is in any way precluded by the Articles of Association of the
Joint Venture, the parties hereto promptly shall amend such Articles to permit
full implementation and performance.
(g) This Agreement may be executed in counterparts, each of which shall
be deemed an original, but which together shall constitute one and the same
instrument.
(h) This Agreement will be governed by and construed in accordance with
the laws of the State of New York. Each party hereto hereby submits to the
jurisdiction of the federal and state courts located in New York City, New York,
with respect to any action or claim brought by a party hereto to enforce any
provision of this Agreement.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]
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IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Agreement as of the day and year first above written.
MESSAGEMEDIA EUROPE B.V.
By: /s/ A. Xxxxxxxx Xxxxx
--------------------------------------
Name: A. Xxxxxxxx Xxxxx
Its:
-------------------------------------
MESSAGEMEDIA, INC.
By: /s/ A. Xxxxxxxx Xxxxx
--------------------------------------
A. Xxxxxxxx Xxxxx
President and Chief Executive Officer
MESSAGEMEDIA US/EUROPE, INC.
By: /s/ A. Xxxxxxxx Xxxxx
--------------------------------------
Name: A. Xxxxxxxx Xxxxx
Its:
-------------------------------------
@VISO LIMITED
By: /s/ Xxxxxx Xxxxxx
--------------------------------------
Xxxxxx Xxxxxx
Director
By: /s/ Xxxxx Boulben
--------------------------------------
Xxxxx Boulben
Director
SIGNATURE PAGE TO AGREEMENT TO EFFECT ORDERLY LIQUIDATION
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EXHIBIT A
CONTRIBUTED AMOUNT PROMISSORY NOTE
$2,000,000 May 9, 0000
Xxxxxxxxxx, Xxxxxxxx
FOR VALUE RECEIVED, MESSAGEMEDIA, INC., a Delaware corporation
("BORROWER"), hereby promises to pay to the order of @VISO LIMITED, a company
incorporated under the laws of England and Wales ("LENDER"), in lawful money of
the United States of America and in immediately available funds, the principal
sum of $2,000,000 (subject to adjustment as set forth below in Section 2) (the
"LOAN"), together with accrued and unpaid interest thereon, each due and payable
on the date and in the manner set forth below.
1. PRINCIPAL REPAYMENT. The outstanding principal amount of the Loan shall be
unsecured and subordinated to the repayment of any secured indebtedness and be
due and payable on December 31, 2003; provided, however, that this Note
(including accrued interest) will be immediately due and payable upon a "change
of control" (the "MATURITY DATE"). For purposes of this Note, a "CHANGE OF
CONTROL" means any of the following: (i) a sale, lease or other disposition of
all or substantially all of the assets of Borrower; (ii) a merger or
consolidation in which Borrower is not the surviving corporation (other than one
to effect a mere reincorporation of Borrower) or a reverse merger in which
Borrower is the surviving corporation but the shares of Borrower's common stock
outstanding immediately preceding the merger are converted by virtue of the
merger into other property, whether in the form of securities, cash or
otherwise, in either case in which the holders of outstanding voting securities
of Borrower immediately prior to the effective date of such transaction would
have beneficial ownership of less than 50% of the total combined voting power of
the surviving corporation following the consummation of such transaction; or
(iii) any transaction (or series of related transactions involving a person or
entity, or a group of affiliated persons or entities) in which in excess of 50%
of Borrower's outstanding voting power is transferred.
2. ADJUSTMENT OF PRINCIPAL. As described in Section 1(b) of that certain
Agreement to Effect Orderly Liquidation of MessageMedia Europe, B.V., by and
between MessageMedia Europe, B.V. (the "JOINT VENTURE"), Borrower, MessageMedia
US/Europe, Inc. and Lender, dated the date hereof (the "SHUTDOWN AGREEMENT"),
Borrower and Lender agree that in the event that the Contributed Amounts (as
defined in the Shutdown Agreement) exceed the Shutdown Costs (as defined in the
Shutdown Agreement) (such excess amount, the "EXCESS CONTRIBUTED AMOUNTS"),
concurrently with the liquidation of the Joint Venture, the principal amount of
this Note shall automatically and without any further action be reduced by an
amount equal to 50% of the Excess Contributed Amounts (interest hereunder shall
cease to accrue on such eliminated principal amount as of such time).
3. INTEREST RATE. Borrower further promises to pay interest on the outstanding
principal amount hereof from the date hereof until payment in full, which
interest shall be payable as follows (or, if less, at the maximum rate
permissible by law, which under the laws of the State of
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New York shall be deemed to be the laws relating to permissible rates of
interest on commercial loans):
(a) beginning as of the date on which Borrower causes to be obtained a
security interest in its assets in favor of Lender that is subordinate to any
security interest in such assets held by Xxxxx Fargo Equipment Finance, Inc.
(which Borrower shall use commercially reasonable efforts to obtain), the
interest on this Note shall accrue at the rate of 10% per annum, and any
interest hereunder accrued and not paid as of such date and any subsequent
interest which shall accrue hereunder shall be due and payable on the Maturity
Date; and
(b) subject to clause (a) above, until such time as Borrower causes to
be obtained a security interest in its assets in favor of Lender that is
subordinate to any security interest in such assets held by Xxxxx Fargo
Equipment Finance, Inc., the interest on this Note shall accrue at the rate of
15% per annum and be due and payable on the six month anniversary date hereof
and on each six month anniversary date thereafter, until all principal amounts
due hereunder shall have been paid in full.
Interest shall be calculated on the basis of a 365-day year for the actual
number of days elapsed.
4. PLACE OF PAYMENT. All amounts payable hereunder shall be payable at the
office of Lender, 00 Xxxxxxx Xxxxxx, Xxxxxx XX0X 0XX, Xxxxxxx, unless another
place of payment shall be specified in writing by Lender.
5. APPLICATION OF PAYMENTS. Payments on this Note shall be applied first to
accrued interest, and thereafter to the outstanding principal balance hereof.
6. WAIVER. Borrower waives presentment and demand for payment, notice of
dishonor, protest and notice of protest of this Note, and shall pay all costs of
collection when incurred, including, without limitation, reasonable attorneys'
fees, costs and other expenses. The right to plead any and all statutes of
limitations as a defense to any demands hereunder hereby is waived to the full
extent permitted by law.
7. GOVERNING LAW AND SUBMISSION TO JURISDICTION. This Note shall be governed by,
and construed and enforced in accordance with, the laws of the State of New
York, excluding conflict of law principles that would cause the application of
law of any other jurisdiction. The Borrower hereby irrevocably submits to the
jurisdiction of the federal and state courts located in New York City, New York
with respect to any action or claim brought by the Lender to enforce any
provision of this Note.
8. SUCCESSORS AND ASSIGNS. The provisions of this Note shall inure to the
benefit of and be binding on any successor to Borrower and shall extend to any
holder hereof.
9. SUBORDINATION. The indebtedness evidenced by this Note hereby is expressly
subordinated, to the extent and in the manner hereinafter set forth, in right of
payment to the prior payment in full of the Senior Indebtedness.
"SENIOR INDEBTEDNESS" shall mean, unless expressly subordinated to or
made on a parity with the amounts due under this Note, the principal of, unpaid
interest on and amounts
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reimbursable, fees, expenses, costs of enforcement and other amounts due in
connection with (a) indebtedness of Borrower to Xxxxx Fargo Equipment Finance,
Inc. (the "XXXXX FARGO FACILITY") outstanding as of the date hereof or any other
debt facility (whether from Xxxxx Fargo Equipment Finance, Inc., or any
affiliate thereof, or not) which replaces the Xxxxx Fargo Facility (such
replacement debt not to exceed $3,000,000), whether or not secured, or
indebtedness of Borrower to banks or commercial finance or other lending
institutions regularly engaged in the business of lending money incurred at any
future date if secured solely by the accounts receivable of Borrower, whether or
not secured, and (b) any such indebtedness or any debentures, notes or other
evidence of indebtedness issued in exchange for such Senior Indebtedness, or any
indebtedness arising from the satisfaction of such Senior Indebtedness by a
guarantor.
(a) INSOLVENCY PROCEEDINGS. If there shall occur any receivership,
insolvency, assignment for the benefit of creditors, bankruptcy, reorganization,
or arrangements with creditors (whether or not pursuant to bankruptcy or other
insolvency laws), sale of all or substantially all of the assets, dissolution,
liquidation, or any other marshaling of the assets and liabilities of Borrower,
(a) no amount shall be paid by Borrower in respect of the principal of, interest
on or other amounts due with respect to this Note at the time outstanding,
unless and until the principal of and interest on the Senior Indebtedness then
outstanding shall be paid in full, and (b) no claim or proof of claim shall be
filed by or on behalf of Lender which shall assert any right to receive any
payments in respect of the principal of and interest on this Note, except
subject to the payment in full of the principal of and interest on all of the
Senior Indebtedness then outstanding.
(b) DEFAULT ON SENIOR INDEBTEDNESS. If there shall occur an event of
default which has been declared in writing with respect to any Senior
Indebtedness, as defined therein, or in the instrument under which it is
outstanding, permitting the holder to accelerate the maturity thereof, and
Lender shall have received written notice thereof from the holder of such Senior
Indebtedness, then, unless and until such event of default shall have been cured
or waived or shall have ceased to exist, or all Senior Indebtedness shall have
been paid in full, no payment shall be made in respect of the principal of or
interest on this Note unless within 180 days after the happening of such event
of default the maturity of such Senior Indebtedness shall not have been
accelerated. Not more than one notice may be given to Lender pursuant to the
terms of this Section 9(b) during any 365-day period.
(c) FURTHER ASSURANCES. By acceptance of this Note, Lender agrees to
execute and deliver a customary form of security agreement in the event Borrower
causes to be obtained the security interest referred to in Section 3(a) and
subordination agreement requested from time to time by the holders of Senior
Indebtedness and, as a condition to Lender's rights hereunder, Borrower may
require that Lender execute such forms of security agreement and subordination
agreement.
(d) OTHER INDEBTEDNESS. No indebtedness, which does not constitute
Senior Indebtedness, shall be senior in any respect to the indebtedness
represented by this Note.
(e) SUBROGATION. Subject to the payment in full of all Senior
Indebtedness, Lender shall be subrogated to the rights of the holder(s) of such
Senior Indebtedness (to the extent of the
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payments or distributions made to the holder(s) of such Senior Indebtedness
pursuant to the provisions of this Section 9) to receive payments and
distributions of assets of Borrower applicable to the Senior Indebtedness. No
such payments or distributions applicable to the Senior Indebtedness shall, as
between Borrower and its creditors, other than the holders of Senior
Indebtedness and Lender, be deemed to be a payment by Borrower to or on account
of this Note; and for purposes of such subrogation, no payments or distributions
to the holders of Senior Indebtedness to which Lender would be entitled except
for the provisions of this Section 9 shall, as between Borrower and its
creditors, other than the holders of Senior Indebtedness and Lender, be deemed
to be a payment by Borrower to or on account of the Senior Indebtedness.
(f) NO IMPAIRMENT. Subject to the rights, if any, of the holders of
Senior Indebtedness under this Section 9 to receive cash, securities or other
properties otherwise payable or deliverable to Lender, nothing contained in this
Section 9 shall impair, as between Borrower and Lender, the obligation of
Borrower, subject to the terms and conditions hereof, to pay to Lender the
principal hereof and interest hereon as and when the same become due and
payable, or shall prevent Lender, upon default hereunder, from exercising all
rights, powers and remedies otherwise provided herein or by applicable law.
(g) LIEN SUBORDINATION. Any lien or security interest of Lender,
whether now or hereafter existing in connection with the amounts due under this
Note, on any assets or property of Borrower or any proceeds or revenues
therefrom which Lender may have at any time as security for any amounts due and
obligations under this Note, shall be subordinate to all liens or security
interests now or hereafter granted to a holder of Senior Indebtedness by
Borrower or by law notwithstanding the date, order or method of attachment or
perfection of any such lien or security interest or the provisions of any
applicable law.
(h) APPLICABILITY OF PRIORITIES. The priority of the holder of the
Senior Indebtedness provided for herein with respect to security interests and
liens are applicable only to the extent that such security interests and liens
are enforceable and perfected and have not been avoided; if a security interest
or lien judicially is determined to be unenforceable or unperfected or
judicially is avoided with respect to any claim of the holder of the Senior
Indebtedness or any part thereof, the priority provided for herein shall not be
available to such security interest or lien to the extent that it is avoided or
determined to be unenforceable or unperfected. The foregoing notwithstanding,
Lender covenants and agrees that it shall not challenge, attack or seek to avoid
any security interest or lien to the extent that it secures any holder of the
Senior Indebtedness. Nothing in this Section 9(h) affects the operation of any
subordination of indebtedness or turnover of payment provisions hereof, or of
any other agreements among any of the parties hereto.
(i) RELIANCE OF HOLDERS OF SENIOR INDEBTEDNESS. Lender, by its
acceptance hereof, shall be deemed to acknowledge and agree that the foregoing
subordination provisions are, and are intended to be, an inducement to and a
consideration of each holder of Senior Indebtedness, whether such Senior
Indebtedness was created or acquired before or after the creation of the
indebtedness evidenced by this Note, and each such holder of Senior Indebtedness
shall be deemed conclusively to have relied on such subordination provisions in
acquiring and holding, or in continuing to hold, such Senior Indebtedness.
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15
IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Contributed Amount Promissory Note as of the day and year first above
written.
BORROWER:
MESSAGEMEDIA, INC.
By: /s/ A. Xxxxxxxx Xxxxx
--------------------------------------
A. Xxxxxxxx Xxxxx
President and Chief Executive Officer
LENDER:
@VISO LIMITED
By: /s/ Xxxxxx Xxxxxx
--------------------------------------
Xxxxxx Xxxxxx
Director
By: /s/ Xxxxx Boulben
--------------------------------------
Xxxxx Boulben
Director
A-5
16
EXHIBIT B
TERMINATION NOTE
$2,500,000 May 9, 2001
Louisville, Colorado
FOR VALUE RECEIVED AND IN CONSIDERATION FOR THE TERMINATION AND RELEASE
OF THAT CERTAIN LOAN AGREEMENT, DATED AS OF MARCH 7, 2000, BY AND BETWEEN @VISO
LIMITED AND MESSAGEMEDIA, INC. (THE "LOAN AGREEMENT"), MESSAGEMEDIA, INC., a
Delaware corporation ("BORROWER"), hereby promises to pay to the order of @VISO
LIMITED, a company incorporated under the laws of England and Wales ("LENDER"),
in lawful money of the United States of America and in immediately available
funds, the principal sum of $2,500,000 (the "LOAN"), together with accrued and
unpaid interest thereon, each due and payable on the date and in the manner set
forth below.
1. PRINCIPAL REPAYMENT. The outstanding principal amount of the Loan shall be
unsecured and subordinated to the repayment of any secured indebtedness and be
due and payable on December 31, 2003; provided, however, that this Note will be
immediately due and payable upon a "change of control" (the "MATURITY DATE").
For purposes of this Note, a "CHANGE OF CONTROL" means any of the following: (i)
a sale, lease or other disposition of all or substantially all of the assets of
Borrower; (ii) a merger or consolidation in which Borrower is not the surviving
corporation (other than one to effect a mere reincorporation of Borrower) or a
reverse merger in which Borrower is the surviving corporation but the shares of
Borrower's common stock outstanding immediately preceding the merger are
converted by virtue of the merger into other property, whether in the form of
securities, cash or otherwise, in either case in which the holders of
outstanding voting securities of Borrower immediately prior to the effective
date of such transaction would have beneficial ownership of less than 50% of the
total combined voting power of the surviving corporation following the
consummation of such transaction; or (iii) any transaction (or series of related
transactions involving a person or entity, or a group of affiliated persons or
entities) in which in excess of 50% of Borrower's outstanding voting power is
transferred.
2. INTEREST RATE. Borrower further promises to pay interest on the outstanding
principal amount hereof from the date hereof until payment in full, which
interest shall be payable as follows (or, if less, at the maximum rate
permissible by law, which under the laws of the State of New York shall be
deemed to be the laws relating to permissible rates of interest on commercial
loans):
(a) beginning as of the date on which Borrower causes to be obtained a
security interest in its assets in favor of Lender that is subordinate to any
security interest in such assets held by Xxxxx Fargo Equipment Finance, Inc.
(which Borrower shall use commercially reasonable efforts to obtain), the
interest on this Note shall accrue at the rate of 10% per annum, and any
interest hereunder accrued and not paid as of such date and any subsequent
interest which shall accrue hereunder shall be due and payable on the Maturity
Date; and
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(b) subject to clause (a) above, until such time as Borrower causes to
be obtained a security interest in its assets in favor of Lender that is
subordinate to any security interest in such assets held by Xxxxx Fargo
Equipment Finance, Inc., the interest on this Note shall accrue at the rate of
15% per annum and be due and payable on the six month anniversary date hereof
and on each six month anniversary date thereafter, until all principal amounts
due hereunder shall have been paid in full.
Interest shall be calculated on the basis of a 365-day year for the actual
number of days elapsed.
3. PLACE OF PAYMENT. All amounts payable hereunder shall be payable at the
office of Lender, 00 Xxxxxxx Xxxxxx, Xxxxxx XX0X 0XX, Xxxxxxx, unless another
place of payment shall be specified in writing by Lender.
4. APPLICATION OF PAYMENTS. Payments on this Note shall be applied first to
accrued interest, and thereafter to the outstanding principal balance hereof.
5. WAIVER. Borrower waives presentment and demand for payment, notice of
dishonor, protest and notice of protest of this Note, and shall pay all costs of
collection when incurred, including, without limitation, reasonable attorneys'
fees, costs and other expenses. The right to plead any and all statutes of
limitations as a defense to any demands hereunder hereby is waived to the full
extent permitted by law.
6. GOVERNING LAW AND SUBMISSION TO JURISDICTION. This Note shall be governed by,
and construed and enforced in accordance with, the laws of the State of New
York, excluding conflict of law principles that would cause the application of
law of any other jurisdiction. The Borrower hereby irrevocably submits to the
jurisdiction of the federal and state courts located in New York City, New York
with respect to any action or claim brought by the Lender to enforce any
provision of this Note.
7. SUCCESSORS AND ASSIGNS. The provisions of this Note shall inure to the
benefit of and be binding on any successor to Borrower and shall extend to any
holder hereof.
8. SUBORDINATION. The indebtedness evidenced by this Note hereby is expressly
subordinated, to the extent and in the manner hereinafter set forth, in right of
payment to the prior payment in full of the Senior Indebtedness.
"SENIOR INDEBTEDNESS" shall mean, unless expressly subordinated to or
made on a parity with the amounts due under this Note, the principal of, unpaid
interest on and amounts reimbursable, fees, expenses, costs of enforcement and
other amounts due in connection with (a) indebtedness of Borrower to Xxxxx Fargo
Equipment Finance, Inc. (the "XXXXX FARGO FACILITY") outstanding as of the date
hereof or any other debt facility (whether from Xxxxx Fargo Equipment Finance,
Inc., or any affiliate thereof, or not) which replaces the Xxxxx Fargo Facility
(such replacement debt not to exceed $3,000,000), whether or not secured, or
indebtedness of Borrower to banks or commercial finance or other lending
institutions regularly engaged in the business of lending money incurred at any
future date if secured solely by the accounts receivable of Borrower, whether or
not secured, and any such indebtedness or any debentures, notes or other
evidence of indebtedness issued in exchange for such Senior Indebtedness, or any
indebtedness arising from the satisfaction of such Senior Indebtedness by a
guarantor.
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18
(a) INSOLVENCY PROCEEDINGS. If there shall occur any receivership,
insolvency, assignment for the benefit of creditors, bankruptcy, reorganization,
or arrangements with creditors (whether or not pursuant to bankruptcy or other
insolvency laws), sale of all or substantially all of the assets, dissolution,
liquidation, or any other marshaling of the assets and liabilities of Borrower,
(a) no amount shall be paid by Borrower in respect of the principal of, interest
on or other amounts due with respect to this Note at the time outstanding,
unless and until the principal of and interest on the Senior Indebtedness then
outstanding shall be paid in full, and (b) no claim or proof of claim shall be
filed by or on behalf of Lender which shall assert any right to receive any
payments in respect of the principal of and interest on this Note, except
subject to the payment in full of the principal of and interest on all of the
Senior Indebtedness then outstanding.
(b) DEFAULT ON SENIOR INDEBTEDNESS. If there shall occur an event of
default which has been declared in writing with respect to any Senior
Indebtedness, as defined therein, or in the instrument under which it is
outstanding, permitting the holder to accelerate the maturity thereof, and
Lender shall have received written notice thereof from the holder of such Senior
Indebtedness, then, unless and until such event of default shall have been cured
or waived or shall have ceased to exist, or all Senior Indebtedness shall have
been paid in full, no payment shall be made in respect of the principal of or
interest on this Note unless within 180 days after the happening of such event
of default the maturity of such Senior Indebtedness shall not have been
accelerated. Not more than one notice may be given to Lender pursuant to the
terms of this Section 8(b) during any 365-day period.
(c) FURTHER ASSURANCES. By acceptance of this Note, Lender agrees to
execute and deliver a customary form of security agreement in the event Borrower
causes to be obtained the security interest referred to in Section 2(a) and
subordination agreement requested from time to time by the holders of Senior
Indebtedness and, as a condition to Lender's rights hereunder, Borrower may
require that Lender execute such forms of security agreement and subordination
agreement.
(d) OTHER INDEBTEDNESS. No indebtedness, which does not constitute
Senior Indebtedness, shall be senior in any respect to the indebtedness
represented by this Note.
(e) SUBROGATION. Subject to the payment in full of all Senior
Indebtedness, Lender shall be subrogated to the rights of the holder(s) of such
Senior Indebtedness (to the extent of the payments or distributions made to the
holder(s) of such Senior Indebtedness pursuant to the provisions of this Section
8) to receive payments and distributions of assets of Borrower applicable to the
Senior Indebtedness. No such payments or distributions applicable to the Senior
Indebtedness shall, as between Borrower and its creditors, other than the
holders of Senior Indebtedness and Lender, be deemed to be a payment by Borrower
to or on account of this Note; and for purposes of such subrogation, no payments
or distributions to the holders of Senior Indebtedness to which Lender would be
entitled except for the provisions of this Section 8 shall, as between Borrower
and its creditors, other than the holders of Senior Indebtedness and Lender, be
deemed to be a payment by Borrower to or on account of the Senior Indebtedness.
(f) NO IMPAIRMENT. Subject to the rights, if any, of the holders of
Senior Indebtedness under this Section 8 to receive cash, securities or other
properties otherwise
B-3
19
payable or deliverable to Lender, nothing contained in this Section 8 shall
impair, as between Borrower and Lender, the obligation of Borrower, subject to
the terms and conditions hereof, to pay to Lender the principal hereof and
interest hereon as and when the same become due and payable, or shall prevent
Lender, upon default hereunder, from exercising all rights, powers and remedies
otherwise provided herein or by applicable law.
(g) LIEN SUBORDINATION. Any lien or security interest of Lender,
whether now or hereafter existing in connection with the amounts due under this
Note, on any assets or property of Borrower or any proceeds or revenues
therefrom which Lender may have at any time as security for any amounts due and
obligations under this Note, shall be subordinate to all liens or security
interests now or hereafter granted to a holder of Senior Indebtedness by
Borrower or by law notwithstanding the date, order or method of attachment or
perfection of any such lien or security interest or the provisions of any
applicable law.
(h) APPLICABILITY OF PRIORITIES. The priority of the holder of the
Senior Indebtedness provided for herein with respect to security interests and
liens are applicable only to the extent that such security interests and liens
are enforceable and perfected and have not been avoided; if a security interest
or lien judicially is determined to be unenforceable or unperfected or
judicially is avoided with respect to any claim of the holder of the Senior
Indebtedness or any part thereof, the priority provided for herein shall not be
available to such security interest or lien to the extent that it is avoided or
determined to be unenforceable or unperfected. The foregoing notwithstanding,
Lender covenants and agrees that it shall not challenge, attack or seek to avoid
any security interest or lien to the extent that it secures any holder of the
Senior Indebtedness. Nothing in this Section 8(h) affects the operation of any
subordination of indebtedness or turnover of payment provisions hereof, or of
any other agreements among any of the parties hereto.
(i) RELIANCE OF HOLDERS OF SENIOR INDEBTEDNESS. Lender, by its
acceptance hereof, shall be deemed to acknowledge and agree that the foregoing
subordination provisions are, and are intended to be, an inducement to and a
consideration of each holder of Senior Indebtedness, whether such Senior
Indebtedness was created or acquired before or after the creation of the
indebtedness evidenced by this Note, and each such holder of Senior Indebtedness
shall be deemed conclusively to have relied on such subordination provisions in
acquiring and holding, or in continuing to hold, such Senior Indebtedness.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK.]
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20
IN WITNESS WHEREOF, the parties hereto have duly executed and delivered
this Termination Note as of the day and year first above written.
BORROWER:
MESSAGEMEDIA, INC.
By: /s/ A. Xxxxxxxx Xxxxx
--------------------------------------
A. Xxxxxxxx Xxxxx
President and Chief Executive Officer
LENDER:
@VISO LIMITED
By: /s/ Xxxxxx Xxxxxx
--------------------------------------
Xxxxxx Xxxxxx
Director
By: /s/ Xxxxx Boulben
--------------------------------------
Xxxxx Boulben
Director
B-5
