Attached files
| file | filename |
|---|---|
| EX-31.1 - CERTIFICATION OF CEO PURSUANT TO SECTION 302 - WLG INC | v178101_ex31-1.htm |
| EX-21.1 - SUBSIDIARIES OF THE REGISTRANT - WLG INC | v178101_ex21-1.htm |
| EX-32.1 - CERTIFICATION OF CEO AND CFO PURSUANT TO SECTION 906 - WLG INC | v178101_ex32-1.htm |
| EX-31.2 - CERTIFICATION OF CFO PURSUANT TO SECTION 302 - WLG INC | v178101_ex31-2.htm |
| EX-23 - WLG INC | v178101_ex23-1.htm |
| EX-10.20 - WLG INC | v178101_ex10-20.htm |
| EX-10.17 - WLG INC | v178101_ex10-17.htm |
| EX-10.18 - WLG INC | v178101_ex10-18.htm |
| EX-10.16 - WLG INC | v178101_ex10-16.htm |
| 10-K - ANNUAL REPORT - DECEMBER 31, 2009 - WLG INC | v178101_10k.htm |
Exhibit
10.19
AGREEMENT
OF SUBORDINATION AND STANDSTILL
THIS
AGREEMENT OF SUBORDINATION AND STANDSTILL, including amendments, modifications,
and supplements (all hereinafter referred to as the "Agreement") as of this
24th day
of February, 2010 by and among WLG (USA) LLC and World Commerce
Services, L.L.C., jointly and severally, both limited liability companies
organized and existing under the laws of the State of Illinois, with principal
places of business located at 920 East Algonquin Road, Suite 120, Schaumburg,
Illinois, 60173 (“collectively, Debtor”) NOVA Business Credit, a division of
NOVA Bank, having its office at 1235 Westlakes Drive, Suite 420, Berwyn, PA
19312 ("Senior Lender"), and WLG Inc., a corporation organized and existing
under the laws of the State of Delaware with principal offices located at 920
East Algonquin Road, Suite 120, Schaumburg, Illinois, 60173
("Subordinator").
WITNESSETH:
Pursuant
to the Loan Agreements and Notes described in Exhibit "A" attached
hereto and made part hereof, all as amended and to be amended (collectively, the
"Loan Agreements"), Senior Lender has made or is about to make certain Loans and
advances to the Debtor (collectively, the "Loans"). Debtor is obligated to
Senior Lender for the payment of the Loans and all other advances and
Obligations as such term is defined in the Loan Agreements. The
Obligations are secured by the first priority liens and security interests on
certain collateral security described in the Loan Agreements.
All of
the Loan Agreements and all agreements, instruments and documents executed in
connection with the Loans and
Obligations shall be hereinafter referred to as the "Loan
Documents".
All amounts due to the Subordinator
from Debtor, whether currently existing or hereinafter arising, shall be
hereinafter referred to collectively as the “Subordinated Loans” (Exhibit B).
The terms and conditions set forth in the documents, if any, executed in
connection with the Subordinated Loans or pursuant to any understanding between
or among the Subordinator or the Debtor shall be hereinafter referred to as the
“Subordinated Loan Documents”.
As a
condition to the Loans made and to be made by Senior Lender to the Debtor, the
Loan Documents provide that the Subordinated Loans and all security therefor
must be junior and subordinate to the payment of Loans and the Obligations due
and owing to Senior Lender pursuant to the Loan Documents and the collateral
therefor to the extent, and for the term set forth in this
Agreement.
NOW,
THEREFOR, in consideration of, and to induce Senior Lender to make the Loans to
the Debtor pursuant to the Loan Documents, as now or hereinafter amended, and
with the knowledge that the Senior Lender would not make the Loans but for the
promises of the Subordinator contained in this Agreement, the Subordinator
hereby absolutely and unconditionally represents, warrants, covenants and agrees
that:
1)
Notwithstanding any term, condition or provision of any of the Subordinated Loan
Documents executed in connection with any Subordinated Loans to Debtor to the
contrary, to induce the Senior Lender to lend or advance monies or otherwise
extend credit to or for the benefit of Debtor in accordance with the Loan
Documents and to better secure the Senior Lender in respect thereof,
Subordinator hereby subordinates (a) all of its rights (whether absolute or
contingent) under the Subordinated Loan Documents (including, without
limitation, any guaranty), including (except as provided in Paragraph 3) all
payments of interest and principal (the "Subordinated Loan Payments"), owed by
Debtor to Subordinator, and (b) any lien or security interest in favor of
Subordinator in any assets of Debtor or executed in connection with any
Subordinated Loan, to all debts, demands, claims, liabilities, (whether such
amounts represent principal or interest or prepayment thereof, and all
Obligations which are due or to become due, direct or indirect, absolute or
contingent), or causes of action
for which Debtor, or any successor or assign
of Debtor, including,
without limitation, a receiver, trustee or debtor in possession may now
or at any time hereinafter in any way be liable to Senior Lender as a result of
the Loans as evidenced by the Loan Documents and any collateral security for any
of the Obligations.
1
2) Until the Obligations are satisfied
in full, (a) all liens and security interests of Subordinator, whether now or
hereinafter arising and howsoever existing, in any assets and/or properties
of Debtor or Debtor or
in any collateral or assets securing the Loans or Obligations shall be
and hereby are subordinated to the rights and interests of the Senior
Lender in those assets and properties and the collateral described in the Loan
Documents regardless of the time of creation or attachment of security interest
or of recording or filing of mortgages, financing statements or other documents
relating thereto, (b) Subordinator shall not: (i) enforce or attempt to enforce
any rights which it may ever have in and to any security interest in any assets
and properties, or collateral of Debtor given as security for any of the
Subordinated Loans, (ii) act as a petitioning creditor in any bankruptcy,
receivership or similar proceeding filed against Debtor, or (iii) accelerate any
portion of the Subordinated Loan Payments for any purposes or (iv)
pursue any and all other rights and remedies granted to any Subordinator under
any of the Subordinated Loan Documents executed in connection with any of the
Subordinated Loans, or by law. The Subordinator shall have no right to
possession of any of the assets, collateral and/or properties of Debtor or to
foreclose upon any such assets, collateral and/or properties, whether by
judicial action or otherwise, or take any other action described in this
paragraph unless and until all of the Obligations shall have been full and
finally paid, performed and satisfied and all financing arrangements between
Debtor and the Senior Lender have been terminated.
3) Subject to the provisions of the
Loan Agreement, Debtor may not make any payments to the Subordinator
at the times and to the extent set forth in the Subordinated Loan Documents or
for any other purpose. Furthermore, no Subordinated Loan may be prepaid,
cancelled, or exchanged and Subordinator shall not ask for, demand, take or
receive from Debtor or any of the Assets of Debtor any prepayment, cancellation
or exchange of the Subordinated Loan and Debtor shall not have any right to
prepay, cancel or exchange the Subordinated Loan without the prior written
Consent of Senior Lender.
4) Furthermore, upon the occurrence of
an Event of Default under any of the Loan Documents, and thereinafter, so long
as the Obligations remain unsatisfied in addition to the restrictions contained
in Paragraph 2: (a) Debtor shall not pay and the Subordinator
shall not accept payment of, or ask, demand, sue for, take or receive from
Debtor, by set off, receipt of proceeds of collateral, or in any other manner,
the whole or any part of any of the Subordinated Loan Payments which may now or
hereinafter be owing under or in connection with the Subordinated Loans; and,
(b) Subordinator shall not: (i) enforce or attempt to enforce any rights which
it may ever have against Debtor in connection with any of the Subordinated Loans
or (ii) pursue any other rights and remedies granted to Subordinator under any
of the Subordinated Loan Documents executed in connection with any of the
Subordinated Loans, or by law, unless or until the final payment in
full of all Obligations has been made, performed and satisfied with
interest, including interest accruing after filing of a bankruptcy petition, and
all financing arrangements pursuant to the Loan Documents have been terminated.
Such evidence of payment in full of the Obligations shall be furnished to the
Subordinator only by the Senior Lender, and no Subordinator may rely on any
statements of Debtor as to the payment of the Loans. The occurrence of an Event
of Default under any of the Loan Documents shall be conclusively evidenced by
the Senior Lender's notice of such occurrence forwarded by the Senior Lender to
Subordinator.
5) Subordinator hereby authorizes
Senior Lender to execute and/or record such documents as are necessary or
appropriate, including UCC-3 amendments, to evidence the subordination of
Subordinator's liens, security interests, rights or claims against Debtor and
its Assets to the extent provided in this Agreement.
6)
Subordinator has not assigned or transferred any of its rights, title and
interest under any Subordinated Loan, to any other person, and Subordinator will
not make any assignment or transfer thereof. Any assignment or transfer in
violation of this Paragraph 5 shall be void and of no legal effect with respect
to the rights of the Senior Lender under this Agreement. Any assignment or
transfer made by Subordinator whether in violation of this Paragraph 5 or
otherwise shall, in all cases, be made subject to the terms and conditions of
the subordination provisions set forth in this Agreement.
7)
Subordinator waives notice of and acceptance hereof, the giving or extension of
credit to Debtor by the Senior Lender or the taking or releasing of security for
the payment thereof, and waives all presentment, demand, protest, notice of
protest and default, and all other notices to which the Subordinator might
otherwise be entitled in connection with the Loans except notice of the
occurrence of an Event of Default.
8) This
Agreement and the obligations of Debtor and Subordinator and the rights and
privileges of the Senior Lender hereunder shall continue until the final payment
in full of all Obligations, claims, monies, indebtedness and other sums owed to
the Senior Lender arising out of and in connection with the Loans,
notwithstanding any action or non-action of the Senior Lender with respect
thereto or any collateral therefore and any guaranties thereof.
2
9) In the event of any dissolution,
winding up, liquidation, readjustment, reorganization or other similar
proceedings relating to Debtor, or its creditors, as such, or to its property,
(whether voluntary or involuntary, partial or complete, and
whether in bankruptcy, insolvency or receivership, or upon an assignment
for the benefit of creditors, or any other marshaling of assets and
liabilities of Debtor, or any sale of all or substantially all of the assets of
Debtor, or otherwise), the Obligations shall first be paid in full before
Subordinator shall be entitled to receive and to retain any payment or
distribution in respect of the Subordinated Loan Payments due under any
Subordinated Loan and, in order to implement the foregoing: (a) all payments and
distributions of any kind or character in respect of the Subordinated Loan
Payments due under any Subordinated Loan to which Subordinator would otherwise
be entitled if the Subordinated Loan Payments due under the Subordinated Loan
were not subordinated and pledged or assigned pursuant to this Agreement, shall
be made directly to Senior Lender as payment in respect of the Obligations; (b)
the Subordinator shall promptly file a claim or claims, in the form required in
such proceedings, for the full outstanding amount of the Subordinated Loan
Payments due under the Subordinated Loan, and shall cause said claim or claims
to be approved and all payments and other distributions in respect thereof to
made directly to the Senior Lender; and (c) Subordinator hereby irrevocably
agrees that the Senior Lender may, at its sole discretion, in the name of
Subordinator or otherwise, demand, sue for, collect, receive and receipt for any
and all such payments or distributions, and file, prove and vote
or consent in any such proceedings with respect to any and all claims of
Subordinator relating to the Subordinated Loan for application toward the
Loan, all of which are hereby assigned to Senior Lender.
10) In
the event that Subordinator receives any payment or other distribution of any
kind or character from Debtor, or from any other source whatsoever, in respect
of any of any Subordinated Loan Payments due under any Subordinated Loan, other
than as expressly permitted by the terms of this Agreement, such payment or
other distribution shall be received in trust for the Senior Lender and promptly
turned over by the Subordinator to the Senior Lender for application toward the
Obligations. Subordinator will mark its books and records so as to clearly
indicate that the payments due under the Subordinated Loan are subordinated in
accordance with the terms of this Agreement. Subordinator will execute such
further documents or instruments and take such further actions as the Senior
Lender may reasonably from time to time request to carry out the intent of this
Agreement.
11) All
payments and distributions received by the Senior Lender under this Agreement in
respect of the payments due under any Subordinated Loan for application toward
the repayment of the Obligations, to the extent received in or converted into
cash, may be applied by the Senior Lender first to the payment of any and all
expenses (including attorneys' fees and legal expenses) paid or incurred by the
Senior Lender in enforcing this Agreement, or in endeavoring to collect or
realize upon any of the Subordinated Loan Payments due under the Subordinated
Loan or any security therefor, and any balance thereof shall, solely as between
the Subordinator and the Senior Lender, be applied by the Senior Lender in such
order of application as the Senior Lender may from time to time select, toward
the repayment of the outstanding balance of the Obligations.
12) Subordinator hereby waives: (a)
notice of acceptance by the Senior Lender of this Agreement; (b) notice of the
existence or creation of all or any of the Loans; and (c) all diligence in
collection or protection of or realization upon the Loans, or any part
thereof, or any security therefor.
13) The
Senior Lender may, from time to time, whether before or after any discontinuance
of this Agreement, at its sole discretion and without notice to Subordinator,
take any or all of the following actions: (a) retain or obtain a security interest in
any property to secure the Obligations; (b) retain or obtain the primary or
secondary obligations of any other obligor or obligors with respect to
the Obligations ;(c) extend or renew for one or more periods (whether or not
longer than the original period), alter or exchange the Obligations, or release
or compromise any obligation of any nature of any obligor with respect to the
Obligations; and (d) release its
security interest in, or surrender, release or permit any substitution or exchange for all or
any part of any property securing the Obligations, or extend or renew for
one or more periods (whether or not longer than the original period), or
release, compromise, alter or exchange any obligations of any nature or any
obligor with respect to any such property. Subordinator waives any claim that
Subordinator may have against the Senior Lender arising out of the borrowing of,
or grant of a security interest under Section 364 of the Bankruptcy Code (11
U.S.C. §101, et seq.)to
the Debtor, as debtor in possession. or to any trustee appointed in a proceeding
involving the Debtor.
14) This Agreement shall be binding on
Subordinator, Debtor, their respective successors and assigns and shall
inure to the benefit of Senior
Lender, its successors and assigns.
3
15) This
Agreement shall be interpreted and enforced in accordance with and shall be
subject to the laws of the Commonwealth of Pennsylvania.
16)
Unless otherwise indicated differently, all notices, payments, requests,
reports, information or demands which any party hereto may desire or may be
required to give to any other party hereunder, shall be in writing and shall be
personally delivered or sent by facsimile, courier or first-class certified or
registered United States mail, postage prepaid, return receipt requested, and
sent to the party at its address appearing below or to such other address as any
party shall hereinafter inform the other party hereto by written notice given as
aforesaid.
If to
Debtor: WLG (USA)
LLC
World Commerce Services,
L.L.C.
920 East Algonquin, Suite
120
Schaumburg, Illinois 60173
Attn: Edmund C. Pawelko, Chief
Executive Officer
Fax:
630-477-0483
If to the
Senior Lender:
NOVA
Business Credit, a division of NOVA Bank
1235
Westlakes Drive, Suite 420
Berwyn,
PA 19312
Attn:
Randi M. Hershgordon, Vice President
Fax:
610-993-4162
If to the
Subordinator:
WLG
Inc.
920 East
Algonquin Road, Suite 120
Schaumburg,
Illinois 60173
Attn:
David L. Koontz, Chief Financial Officer
Fax:
781-295-4007
All notices, payments, requests,
reports, information or demands so given shall be deemed effective upon receipt
or, if mailed, upon
receipt or expiration of the third day following the date of mailing, whichever
occurs first, except that any notice of change in address shall be effective
only upon receipt by the party to whom said notice is addressed. A failure to send the requisite copies
does not invalidate an otherwise properly sent notice to Debtor, Subordinator or
the Senior Lender.
17) Subordinator shall not consent to,
enter into, agree to or otherwise permit
any amendment, modification or other change in the terms, conditions and
provisions of the Subordinated Loan, the Subordinated Loan Documents and any other documents
or instruments executed in
connection therewith, without the prior consent of the
Senior Lender. Subordinator shall promptly give Senior Lender written notice of
the occurrence of a default or an event of default under the Subordinated Loan
Documents.
18) Any
payments received by Senior Lender may be applied and reapplied, in whole or in
part, to any of the Obligations as Senior Lender, in its sole discretion, deems
appropriate. Without limiting the generality of the foregoing, Subordinator
expressly waives any right as a result of, or with respect to: (a) any
obligation or failure by Senior Lender to marshal any assets in favor of Senior
Lender or against or in payment of all or any part of the Subordinated Loan; (b)
any failure by Senior Lender to enforce in any particular order any security
interests in or lien upon the collateral or any other Assets of Debtor or any
other obligor or guarantor of the Obligations; (c) any failure by Senior Lender
to pursue any remedy against Debtor or upon the collateral or other Assets of
Debtor or against any other individual, entity or property that may be liable
for or serve as security for the Obligations, including any guarantor, or any
collateral for any guaranty, of the obligations of Debtor under the Loan
Agreements; (d) any release by Senior Lender of: (i) any security interests in
or lien upon any collateral, (ii) any obligor, guarantor or other individual or
entity now or hereinafter liable for the Obligations or (iii) any other property
that may now be or hereinafter be security for the Obligations; (e) any
amendment to or modification of the Loan Agreements or any other documents or
agreements between Senior Lender and Debtor or any individual or entity liable
for the Obligations; or (I) any failure by
Senior Lender to pursue any other rights or remedy due to Senior
Lender.
4
19) To
the extent that the Debtor makes a payment or payments to Senior Lender, which
payment or payments or any parts thereof are subsequently invalidated, avoided,
declared to be fraudulent, or preferential, set aside or required to be repaid
to a debtor in possession, a trustee, a receiver, or any other party under the
Bankruptcy Code, any state or federal law, common law, or equitable cause, then
to the extent of such payment or repayment, the obligation or parts thereof
intended to be satisfied shall be revived and continued in full force and effect
as part of the Obligations as if such payment had not been made and shall be
subject in all respects to the subordination and other provisions in favor of
Senior Lender hereunder. This Agreement shall continue until any such revived
Debtor Obligation shall be finally satisfied.
20) In
the event that Subordinator exercises any right under any Subordinated Loan
Documents or any other document or agreement to which Subordinator is a party to
enforce any rights against Debtor, Subordinator will not prevent or attempt to
prevent the exercise in any manner of any right or remedy of Senior Lender under
the Loan Agreements or challenge the validity, enforceability or priority of any
of the Obligations or the obligation of any person therefore or any security for
any such obligation.
21)
Subordinator shall not consent to, enter into, agree to or otherwise permit any
amendment, modification or other change in the terms, conditions and provisions
of any Subordinated Loan, the Subordinated Loan Documents and any other
documents or instruments executed in connection therewith, without the prior
consent of the Senior Lender.
22) The
execution, delivery and performance of its obligations under this Agreement does
not presently and will not in the future cause a default or violation under or
conflict with any material agreement, indenture, document or certificate to
which Subordinator may be a party or to which Subordinator may be bound and will
not result in Subordinator being in material violation of or materially out of
compliance with any federal, state or municipal law, statute, rule, regulation
or ordinance of any governmental authority having jurisdiction over
Subordinator's businesses and/or operations.
23) SUBORDINATOR HEREBY WAIVES ANY AND
ALL RIGHTS THAT IT MAY NOW OR HEREINAFTER HAVE UNDER THE LAWS OF THE UNITED
STATES OF AMERICA OR ANY STATE, TO A TRIAL BY JURY OF ANY AND ALL ISSUES ARISING
EITHER DIRECTLY OR INDIRECTLY IN ANY ACTION OR PROCEEDING BETWEEN THE
SUBORDINATOR, THE SENIOR LENDER AND THEIR SUCCESSORS AND ASSIGNS, OUT OF OR IN
ANY WAY CONNECTED WITH THIS AGREEMENT. IT IS INTENDED THAT SAID WAIVER SHALL
APPLY TO ANY AND ALL DEFENSES, RIGHTS, AND/OR COUNTERCLAIMS IN ANY ACTION OR
PROCEEDING.
24)
Senior Lender has not made any warranties or representations with respect to the
due execution, legality, validity, completeness or enforceability of the
Obligations, the Loan Documents or the collectability of the Obligations, and
that the Senior Lender shall be entitled to manage and supervise the Obligations
in accordance with applicable law and its usual banking practices, modified from
time to time as it deems reasonably appropriate under the
circumstances.
25) No
waiver shall be deemed to be made by the Senior Lender of any of its rights
hereunder, unless the same shall be in writing signed on behalf of the Senior
Lender, and each waiver, if any, shall be a waiver only with respect to the
specific instance involved and shall in no way impair the rights of the Senior
Lender in any
other respect at any other time.
26) Subordinator hereby assumes
responsibility for keeping itself informed of the financial condition of Debtor
and all other circumstances bearing upon the risk of non-payment of the
Obligations and/or any Subordinated Loan that diligent inquiry would reveal, and
Subordinator hereby agrees that the Senior Lender shall have no duty to advise
Subordinator of information known to the Senior Lender regarding such
condition or any such circumstances.
27) If
any provisions of this Agreement shall be invalid under any applicable laws,
such invalidity shall not affect any other provisions of this Agreement that can
be given effect without the invalid provision and to this end, the provisions
hereof are severable.
5
28) This
Agreement may be executed in any number of counterparts, each of which shall be
deemed to be an original, but all of which together shall constitute but one and
the same instrument.
29)
Subordinated Loan Documents are, or will on the date hereof be, inscribed with a
legend conspicuously indicating that the payment thereof is subordinated to the
claims of Senior Lender pursuant to the terms of this Subordination Agreement.
Any instrument evidencing any indebtedness or any portion of any indebtedness
owing by Debtor to Subordinator, whether or not negotiable, that is hereinafter
executed by Debtor shall, on the date thereof be inscribed with the foregoing
legend.
30) Subordinator acknowledges and
agrees that any breach by subordinator of the Agreement shall constitute a
default under that certain Surety Agreement dated February 24, 2010 and shall
entitle Senior Lender to exercise its rights and remedies hereunder and
thereunder, including the right to confess judgment against Subordinator as
provided therein.
[Remainder
of Page Intentionally Left Blank]
6
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and
delivered,
and if by a corporation, by their appropriate authorized corporate officers and
their corporate seals to be
hereunto
affixed and attested pursuant to the resolutions of their respective boards of
directors, all as of the day and
year
first above written.
|
ATTEST/WITNESS:
|
|||
|
WLG Inc.
(“Subordinator”)
|
|||
|
/s/ Mary D. McAleer
|
By:
|
/s/ David L. Koontz
|
|
|
David
L. Koontz
|
|||
|
Its:
|
Chief
Financial Officer
|
||
|
ATTEST/WITNESS:
|
WLG
(USA) LLC
|
||
|
(“Debtor”)
|
|||
|
/s/ Mary D. McAleer
|
By:
|
/s/ Edmund C. Pawelko
|
|
|
Edmund
C. Pawelko
|
|||
|
Its:
|
Chief
Executive Officer
|
||
|
ATTEST/WITNESS:
|
World
Commerce Services, L.L.C.
|
||
|
(“Debtor”)
|
|||
|
/s/ Mary D. McAleer
|
By:
|
/s/ Edmund C. Pawelko
|
|
|
Edmund
C. Pawelko
|
|||
|
Its:
|
Chief
Executive Officer
|
||
|
ATTEST/WITNESS:
|
NOVA
Business Credit, a division of
|
||
|
NOVA
Bank
|
|||
|
(“Senior
Lender”)
|
|||
|
/s/ Mary D. McAleer
|
By:
|
/s/ Randi M. Hershgordon
|
|
|
Randi
M. Hershgordon
|
|||
|
Its:
|
Vice
President
|
||
|
[Corporate
Seal]
|
7
EXHIBIT
"A"
LOAN
AGREEMENTS &
NOTES
|
|
1.
|
Loan
and Security Agreement between WLG (USA) LLC and World Commerce Services,
L.L.C. and NOVA Business Credit, a division of NOVA Bank dated
February 24, 2010, as amended, modified and extended from time
to time.
|
|
|
2.
|
Revolving
Credit Note in the original principal amount of $3,000,000 by WLG (USA)
LLC and World Commerce Services, L.L.C. in favor of NOVA
Business Credit, a division of NOVA Bank dated February 24, 2010, as
amended, modified and extended from time to
time.
|
8
EXHIBIT
"B"
SUBORDINATED
LOANS
All
amounts due to WLG Inc. from Debtor other than accounts payable in the ordinary
course of business, whether currently existing or hereinafter
arising.
9