EXHIBIT 10.17
SUBORDINATION AGREEMENT
THIS SUBORDINATION AGREEMENT (this "Agreement"), dated as of December 30,
---------
1996, by and among CompUSA Holdings II Inc., a Delaware corporation ("Comp II"),
-------
PCs Compleat, Inc., a Delaware corporation ("PCs"), CompUSA Holdings I Inc., a
---
Delaware corporation ("Comp I"), CompTeam Inc., a Delaware corporation
------
("CompTeam"), CompUSA Management Company, a Delaware business trust ("Comp
-------- ----
Management"), CompUSA Stores L.P., a Texas limited partnership ("Comp L.P."),
---------- ---------
and CompUSA Holdings Company, a Delaware business trust ("Comp Holdings")
-------------
(collectively, in their capacity as holders of Subordinated Instruments (as
defined below), the "Subordinate Creditors"), and NATIONSBANK OF TEXAS, N.A., in
---------------------
its capacity as Administrative Lender (the "Administrative Lender") for the
---------------------
Lenders to be a party to the Credit Agreement as described below (the
"Lenders");
-------
WHEREAS, CompUSA Inc., a Delaware corporation (the "Borrower"), has entered
--------
into an Amended and Restated Credit Agreement, dated December 30, 1996, with the
Lenders and the Administrative Lender (as amended, modified, supplemented or
restated from time to time, the "Credit Agreement"; capitalized terms used
----------------
herein and not otherwise defined herein shall have the meaning given to them in
the Credit Agreement);
WHEREAS, the Borrower and its Subsidiaries are obligated or may at times in
the future be obligated to one or more of the Subordinate Creditors;
WHEREAS, as a condition for executing and entering into the Credit
Agreement, the Lenders have required that the Subordinate Creditors' right of
payments and claims against the Borrower and its Subsidiaries be subordinated in
favor of the Lenders' right of payments and claims under the Credit Agreement;
and
WHEREAS, in order to accommodate the Lenders' conditions and obtain the
direct and indirect benefits to the Borrower and the Subordinate Creditors
resulting from the Borrower's and the Lenders' execution of the Credit Agreement
and other Loan Documents (as defined in the Credit Agreement);
NOW, THEREFORE, the parties hereto intending to be legally bound hereby
covenant and agree as follows:
Section 1. Certain Definitions. In addition to the words and terms
-------------------
otherwise defined in this Agreement, the following terms will have the following
meanings (and the singular shall include the plural, and vice versa):
"Credit Obligation Instruments" shall mean, collectively, the Credit
-----------------------------
Agreement and the Notes, the Subsidiary Guaranty (in each case as the same is
defined in the Credit Agreement), and all other agreements, instruments or
documents from time to time directly or indirectly
evidencing, guaranteeing or securing the payment or performance by the Borrower
or any Subsidiary of any indebtedness or obligation arising under or in
connection with any Credit Obligation Instrument.
"Credit Obligations" shall mean any obligation or indebtedness of the
------------------
Borrower or any Subsidiary to any Senior Creditor arising under or in connection
with any of the Credit Obligation Instruments, in each case howsoever created,
arising or evidenced, whether direct or indirect, absolute or contingent, now or
hereafter existing, due or to become due, secured or unsecured, joint or
several, whether for payment or performance, together with all costs, expenses
and attorneys' fees incurred in the enforcement or collection thereof.
"Debtor Relief Laws" shall mean any applicable liquidation,
------------------
conservatorship, bankruptcy, moratorium, rearrangement, insolvency,
reorganization or similar debtor relief laws affecting the rights of creditors
generally from time to time in effect.
"Insolvency Proceeding" shall mean any voluntary or involuntary
---------------------
liquidation, dissolution, sale of all or substantially all assets, marshaling of
assets or liabilities, receivership, conservatorship, assignment for the benefit
of creditors, insolvency, bankruptcy, reorganization, arrangement or composition
of the Borrower or any Subsidiary (whether or not pursuant to any Debtor Relief
Laws) or any other proceedings involving the Borrower or any Subsidiary or any
of the assets of the Borrower or any Subsidiary under any Debtor Relief Laws.
"Lien" shall mean, with respect to any property, any mortgage, lien,
----
pledge, collateral assignment, hypothecation, charge, security interest, or
other encumbrance of any kind in respect of such property, whether or not vested
or perfected.
"Person" shall mean an individual, corporation, partnership, association,
------
joint stock company, trust, joint venture or other legally recognizable entity.
"Security" shall mean any rights, properties or interests of any Senior
--------
Creditor under the Credit Obligation Instruments which provides recourse or
other benefits to any Senior Creditor in connection with the Credit Obligations
for the non-payment or non-performance thereof, including without limitation
collateral (whether real or personal, tangible or intangible) in which any
Senior Creditor has rights under or pursuant to any Credit Obligation
Instruments.
"Senior Creditor" shall mean the Administrative Lender and each Lender.
---------------
"Senior Obligor" shall mean the Borrower and any endorsers, guarantors,
--------------
sureties or obligors, primary or secondary, of any or all of the Credit
Obligations.
"Subordinate Creditor" shall mean Comp II, PCs, Comp I, CompTeam, Comp
--------------------
Management, Comp L.P. and Comp Holdings, and each other holder from time to time
of any Subordinated Instrument.
-2-
"Subordinated Instruments" shall mean all agreements, instruments or
------------------------
documents from time to time directly or indirectly evidencing, guaranteeing or
securing the payment or performance by the Borrower or any Subsidiary of any
indebtedness or obligation arising under or in connection with any Subordinated
Obligation.
"Subordinated Obligations" shall mean any obligation or indebtedness of the
------------------------
Borrower or any Subsidiary to any Subordinate Creditor, in each case howsoever
created, arising or evidenced, whether direct or indirect, absolute or
contingent, now or hereafter existing, due or to become due, secured or
unsecured, joint or several, whether for payment or performance, together with
all costs, expenses and attorneys' fees incurred in the enforcement or
collection thereof.
"Termination Date" shall mean the date hereafter on which all Credit
----------------
Obligations have been paid and satisfied in full.
Section 2. Payment in Full. For all purposes of this Subordination
---------------
Agreement and the Subordinated Instruments, the Senior Creditors shall not be
deemed to have been paid in full until the Termination Date.
Section 3. Subordination of Subordinated Obligations to Senior
---------------------------------------------------
Obligations. Each Subordinate Creditor agrees that the Subordinated Obligations
-----------
shall be and hereby are fully subordinated in right of payment and claim in
favor of the Credit Obligations. Until the Termination Date, each Subordinate
Creditor agrees that it will not request, demand, accept, or receive (by set-off
or other manner), and the Borrower and each Subsidiary agrees that it will not
pay or deliver to any Subordinate Creditor, whether by payment, prepayment, set-
off or otherwise, any payment amount, credit or reduction of all or any part of
the amounts owing under the Subordinated Obligations or any security therefor,
except as specifically allowed pursuant to Section 4 hereof.
Section 4. Payment of Subordinated Obligations. Notwithstanding the
-----------------------------------
provisions of Section 3 hereof, the Borrower and each Subsidiary may pay to each
Subordinate Creditor and each Subordinate Creditor may receive and retain from
the Borrower and each Subsidiary regularly scheduled payments due and owing
under the terms of the Subordinated Instruments or as permitted under the terms
of the Subordinated Instruments, provided that the Borrower's and each
Subsidiary's right to pay and each Subordinate Creditor's right to receive any
such regularly scheduled amount shall automatically and immediately be suspended
and cease (i) upon the occurrence of a Default (as defined in the Loan
Documents) or (ii) if, after taking into account the effect of such payment, a
Default would occur and be continuing. Each Subordinate Creditor's right to
receive amounts under this Section 4 (including any amounts which theretofore
may have been suspended) shall automatically be reinstated in such time as the
Default which was the basis of such suspension has been cured to the Lenders'
satisfaction (provided that no subsequent Default has occurred) or such earlier
date, if any, as the Administrative Lender gives notice to each Subordinate
Creditor of reinstatement by the Lenders, in the Lenders' sole discretion.
-3-
Section 5. Sums Mistakenly Received. If any Subordinate Creditor receives
------------------------
any payment on the Subordinated Obligations in violation of this Subordination
Agreement, such Subordinate Creditor will hold such payment in trust for the
Senior Creditors and will immediately deliver such payment to the Senior
Creditors ( or a representative on their behalf) for application to the Credit
Obligations.
Section 6. No Institution of Collection Proceedings. Until the
----------------------------------------
Termination Date, no Subordinate Creditor will demand or accelerate the maturity
of all or any part of the Subordinated Obligations, nor collect or enforce, or
attempt to collect or enforce, from the Borrower or any Subsidiary all or any
part of the Subordinated Obligations, whether through the commencement or
joinder of a suit, action or proceeding of any type (judicial or otherwise) or
Insolvency Proceeding, the enforcement of any rights against any property of the
Borrower or any Subsidiary, or otherwise, except where any Senior Creditor shall
either join any Subordinate Creditor in bringing proceedings against the
Borrower or any Subsidiary or shall request any Subordinate Creditor to file a
claim in connection with any such proceeding.
Section 7. Insolvency Proceeding. In the event of any Insolvency
---------------------
Proceeding all Credit Obligations shall first be paid, discharged and performed
in full before any payment or performance is made upon the Subordinated
Obligations notwithstanding any other provisions which may be made in such
Insolvency Proceeding. In the event of any Insolvency Proceeding, each
Subordinate Creditor will at any time prior to the Termination Date (a) file, at
the request of any Senior Creditor, any claim, proof of claim or similar
instrument necessary to enforce the Borrower's or any Subsidiary's obligation to
pay the Subordinated Obligations, and (b) hold in trust for and pay to the
Senior Creditors any and all monies, obligations, property, stock dividends or
other assets received in any such proceeding on account of the Subordinated
Obligations in order that the Senior Creditors may apply such monies or the cash
proceeds of such other assets to the Credit Obligations. In the event that any
Subordinate Creditor fails to take such action upon any Senior Creditor's
request, such Senior Creditor shall be deemed to have been appointed the
attorney-in-fact for such Subordinate Creditor with respect to the Subordinated
Obligations, and such Senior Creditor may in that capacity (i) demand, ▇▇▇ for,
collect and receive any and all such monies, dividends or other assets, (ii)
file any claim, proof of claim or similar instrument, (iii) vote, and (iv)
institute such other proceedings which such Senior Creditor, may deem reasonably
necessary for the collection of the Subordinated Obligations and the enforcement
of the terms of this Subordination Agreement. Upon request of any Senior
Creditor, each Subordinate Creditor will execute and deliver to such Senior
Creditor such other and further powers of attorney or other instruments as such
Senior Creditor may reasonably request to effect the purposes of this
Subordination Agreement. If in any proceeding to enforce the payment of the
Subordinated Obligations it becomes necessary that any Subordinate Creditor
itself prove such claims, such Subordinate Creditor shall do so upon request by
such Senior Creditor. In proving these claims, however, such Subordinate
Creditor shall act as the collection agent of such Senior Creditor and shall
promptly pay any funds so received to such Senior Creditor.
-4-
Section 8. Liens Securing Subordinate Debt. All Liens, rights or interest
-------------------------------
now or hereafter securing or benefiting the Subordinated Obligations are hereby
expressly subordinated and made secondary and inferior to the Liens, rights or
interests now or hereafter securing or benefiting the Credit Obligations. The
subordination and relative priority specified in this Section 8 shall apply to
all Security regardless of the time or order of acquisition of ownership,
attachment or perfection of Liens, the time or order of filing of financing
statements, the failure to file such financing statements, possession of the
Security or the time of giving or failure to give notice of the acquisition or
expected acquisition of any Liens.
Section 9. Assignment of Subordinated Debt. Until the Termination Date,
-------------------------------
no Subordinate Creditor shall transfer, assign or pledge any right, claim or
interest in all or any part of the Subordinated Obligations, unless such
transfer, assignment or pledge is made expressly subject to this Subordination
Agreement. The Subordinate Creditors shall cause each instrument evidencing any
part of the Subordinated Obligations to bear upon its face a conspicuous
statement or legend to the following effect:
"This instrument and the obligations of CompUSA Inc. evidenced hereby
and all security interests securing such obligations are subordinate,
pursuant to that certain Subordination Agreement made by and among the
Subordinated Creditors referred to therein, in favor of NationsBank of
Texas, N.A., as Administrative Lender, for the Lenders referred to
therein, dated December 30, 1996, which Subordination Agreement is
incorporated herein by specific reference thereto as if fully set
forth herein."
Section 10. Unconditional Subordination.
---------------------------
(a) No action which any Senior Creditor may take or omit to take in
connection with any of the Credit Obligation Instruments, any of the Credit
Obligations, or any Security and no course of dealing with the Borrower,
any Senior Obligor, any Senior Creditor, any Subordinate Creditor or any
other Person, shall release or diminish any Subordinate Creditor's
obligations, liabilities, agreements or duties hereunder, affect this
Subordination Agreement in any way, or afford any Subordinate Creditor any
recourse against any Senior Creditor, regardless of whether any such action
or inaction may increase any risks to or liabilities of any Senior
Creditor, any Subordinate Creditor or the Borrower or increase any risk to
or diminish any safeguard of any Security. Without limiting the foregoing,
the Subordinate Creditors hereby expressly agree that each Senior Creditor
may, from time to time, without notice to or the consent of any Subordinate
Creditor:
(i) Amend, change, increase or modify, in whole or in part, any
one or more of the Credit Obligation Instruments and give or refuse to
give any waivers or other indulgences with respect thereto;
-5-
(ii) Neglect, delay, fail, or refuse to take or prosecute any
action for the collection or enforcement of any of the Credit
Obligations, to foreclose or take or prosecute any action in
connection with any Security or Credit Obligation Instrument, to bring
suit against any Senior Obligor or any other Person, or to take any
other action concerning the Credit Obligations or the Credit
Obligation Instruments;
(iii) Accelerate, change, rearrange, extend, or renew the time,
terms, or manner for payment or performance of any one or more of the
Credit Obligations;
(iv) Compromise or settle any unpaid or unperformed Credit
Obligations or any other obligation or amount due or owing, or claimed
to be due or owing, under any one or more of the Credit Obligation
Instruments;
(v) Take, exchange, amend, eliminate, surrender, release, or
subordinate any or all Security for any or all of the Credit
Obligations, accept additional or substituted Security therefor, and
perfect or fail to perfect any Senior Creditor's rights in any or all
Security; and
(vi) Apply all monies received from the Borrower or others, or
from any Security for any of the Credit Obligations, as any Senior
Creditor may determine to be in its best interest, without in any way
being required to marshal Security or assets or to apply all or any
part of such monies upon any particular Credit Obligations.
(b) No change of law or circumstances shall release or diminish any
Subordinate Creditor's obligations, liabilities, agreements, or duties
hereunder, affect this Subordination Agreement in any way, or afford any
Subordinate Creditor any recourse against any Senior Creditor. Without
limiting the foregoing, the obligations, liabilities, agreements, and
duties of each Subordinate Creditor under this Subordination Agreement
shall not be released, diminished, impaired, reduced, or affected by the
occurrence of any of the following from time to time, even if occurring
without notice to or without the consent of each Subordinate Creditor:
(i) Any Insolvency Proceeding or any discharge, impairment,
modification, release, or limitation of the liability of, or stay of
actions or lien enforcement proceedings against, any Senior Obligor,
any properties of any Senior Obligor, or the estate in bankruptcy of
any Senior Obligor in the course of or resulting from any such
proceedings;
(ii) The failure by any Senior Creditor to file or enforce a
claim in any proceeding described in the immediately preceding
subsection (i) or to take any other action in any proceeding to which
any Senior Obligor is a party;
-6-
(iii) The release by operation of law of any Senior Obligor from
any of the Credit Obligations or any other obligations to any Senior
Creditor;
(iv) The invalidity, deficiency, illegality, or unenforceability
of any of the Credit Obligations or the Credit Obligation Instruments,
in whole or in part, any bar by any statute of limitations or other
law of recovery on any of the Credit Obligations, or any defense or
excuse for failure to perform on account of force majeure, act of god,
casualty, impossibility, impracticability, or other defense or excuse
whatsoever;
(v) The failure of any Senior Obligor or any other Person to sign
any instrument or agreement within the contemplation of any Senior
Creditor;
(vi) The fact that any Subordinate Creditor may have incurred
directly part of the Credit Obligations or is otherwise primarily
liable therefor; or
(vii) Without limiting any of the foregoing, any fact or event
(whether or not similar to any of the foregoing) which in the absence
of this provision would or might constitute or afford a legal or
equitable discharge or release of or defense to a guarantor or surety
other than the actual payment and performance by each Subordinate
Creditor under this Subordination Agreement.
(c) If any payment or other transfer to any Senior Creditor by any
Senior Obligor or any other Person is held to constitute a preference or a
voidable transfer under applicable state or federal laws, or if for any
other reason any Senior Creditor is required to refund such payment to the
payor thereof or to pay the amount thereof to any other Person or to
reconvey any property transferred, such payment or other transfer to such
Senior Creditor shall not constitute a release of any Subordinate Creditor
from any liability hereunder, and each Subordinate Creditor agrees and
acknowledges that this Subordination Agreement shall continue to be
effective or shall be reinstated, as the case may be, to the extent of any
such payment or payments or other transfer.
(d) This is a continuing agreement and shall apply to and cover all
Credit Obligations and renewals, extensions and modifications thereof and
substitutions therefor from time to time.
Section 11. Waiver. Each Subordinate Creditor hereby waives, with respect
------
to the Credit Obligations, this Subordination Agreement, and the other Credit
Obligation Instruments; (a) notice of the incurrence of any Credit Obligations
by the Borrower; (b) notice that any Senior Creditor, any Senior Obligor or any
other Person has taken or omitted to take any action under any Credit Obligation
Instrument or any other agreement or instrument relating thereto or relating to
any Credit Obligations; (c) notice of acceptance of this Subordination
Agreement; (d) demand, presentment for payment, and notice of demand, dishonor,
nonpayment, or non-performance; (e) notice of default, notice of intention to
accelerate, notice of acceleration,
-7-
protest, and notice of protest; (f) notice of any renewal, extension,
modification or substitution of any Credit Obligations; and (g) all other
notices whatsoever.
Section 12. Exercise of Remedies. Each Senior Creditor shall have the
--------------------
right to enforce, from time to time, in any order and at each Senior Creditor's
sole discretion, any rights, powers and remedies which such Senior Creditor may
have under the Credit Obligation Instruments or otherwise, including, but not
limited to, judicial foreclosure, the exercise of rights of power of sale, the
taking of a deed of assignment in lieu of foreclosure, the appointment of a
receiver to collect rents, issues and profits, the exercise of remedies against
personal property, or the enforcement of any assignment of leases, rentals, or
other properties or rights, whether real or personal, tangible or intangible;
and this Subordination Agreement shall remain effective even though any rights
which any Subordinate Creditor may have against the Borrower, any Subsidiary or
others may be destroyed or diminished by exercise of any such right or remedy.
No failure on the part of a Senior Creditor to exercise, and no delay in
exercising, any right hereunder or under any other Credit Obligation Instruments
shall operate as a waiver thereof; nor shall any single or partial exercise of
any right preclude any other or further exercise thereof or the exercise of any
other right. The rights, powers and remedies of each Senior Creditor provided
herein and in the other Credit Obligation Instruments are cumulative and are in
addition to, and not exclusive of, any other rights, powers or remedies provided
by law or in equity. The rights of each Senior Creditor hereunder are not
conditional or contingent on any attempt by any Senior Creditor to exercise any
of its rights under any other Credit Obligation Instrument against any Senior
Obligor or any other Person.
Section 13. Subrogation. Until all of the Credit Obligations have been
-----------
paid and performed in full, no Subordinate Creditor shall have any right to
exercise any right of subrogation with respect hereto, and each Subordinate
Creditor hereby waives any rights to enforce any remedy which such Subordinate
Creditor may have against the Borrower and any Subsidiary and any right to
participate in any Security until such time.
Section 14. Successors and Assigns. The Subordinate Creditors'
----------------------
obligations hereunder may not be assigned or delegated, but this Subordination
Agreement and such obligations shall pass to and be fully binding upon the
successors of each Subordinate Creditor. This Subordination Agreement shall
apply to and inure to the benefit of each Senior Creditor and its successors or
assigns. Without limiting the generality of the immediately preceding sentence,
each Senior Creditor may as permitted pursuant to Section 11.6 of the Credit
Agreement, assign, grant a participation in, or otherwise transfer any Credit
Obligations held by it or any portion thereof, and each Senior Creditor may
assign or otherwise transfer its rights or any portion thereof under any Credit
Obligation Instrument, to any other Person, and such other Person shall
thereupon become vested with all of the benefits in respect thereof granted to
such Senior Creditor hereunder.
Section 15. Agreement Not for Benefit of Third Parties. All
------------------------------------------
understandings, agreements, representatives and warranties contained herein are
solely for the benefit of the Senior Creditors and the Subordinate Creditors and
their respective successors and assigns, and
-8-
there are no other parties (including, but not limited to, the Borrower or any
Subsidiary) who are intended to be benefitted in any way by this Agreement.
Section 16. Limitation on Liability. Neither any Senior Creditor, on the
-----------------------
one hand, nor any Subordinate Creditor, on the other hand, shall have any duties
or obligations to the other in respect of the Security or in respect of this
Subordination Agreement, except as expressly set forth herein. Neither any
Senior Creditor, on the one hand, nor any Subordinate Creditor, on the other
hand, shall have any duty or responsibility to the other to maintain or maintain
perfected any Lien in any Security.
Section 17. Representations and Warranties. Each Subordinate Creditor
------------------------------
executing this Subordination Agreement hereby represents and warrants as
follows:
(a) The execution, delivery and performance by such Subordinate
Creditor of this Subordination Agreement have been duly authorized by all
necessary corporate or other action and do not and will not contravene its
certificate or articles of incorporation, bylaws or other governing
documents.
(b) The execution, delivery and performance by such Subordinate
Creditor of this Subordination Agreement do not and will not contravene any
law or governmental regulation or any contractual restriction binding on or
affecting such Subordinate Creditor or any of its properties, and do not
and will not result in or require the creation of any lien, security
interest or other charge or encumbrance upon or with respect to any of its
properties.
(c) No authorization or approval or other action by, and no notice to
or filing with, any Person is required for the due execution, delivery and
performance by such Subordinate Creditor of this Subordination Agreement.
(d) This Subordination Agreement is a legal, valid and binding
obligation of such Subordinate Creditor, enforceable against such
Subordinate Creditor in accordance with its terms, subject to Debtor Relief
Laws.
(e) There is no action, suit or proceeding pending or, to the
knowledge of such Subordinate Creditor, threatened against or otherwise
affecting such Subordinate Creditor before any Tribunal or arbitrator which
may materially and adversely affect such Subordinate Creditor's ability to
perform its obligations hereunder.
(f) The value of the consideration received and to be received by such
Subordinate Creditor in connection herewith is reasonably worth at least as
much as the liability and obligations of such Subordinate Creditor
hereunder, and the incurrence of such liability and obligations in return
for such consideration may reasonably be expected to benefit such
Subordinate Creditor, directly or indirectly.
-9-
Section 18. Applicable Law. This Subordination Agreement shall be
--------------
governed by and construed and enforced in accordance with the laws of the State
of Texas. If any term or provision of this Subordination Agreement shall be
determined to be illegal or unenforceable, all other terms and provisions hereof
shall nevertheless remain effective and shall be enforced to the fullest extent
permitted by applicable law.
Section 19. Additional Documentation. Each Subordinate Creditor agrees to
------------------------
execute any further instruments and to take all other action which, in any
Senior Creditor's opinion, may become necessary or appropriate to carry out
fully the purposes of this Subordination Agreement.
Section 20. Agreement by Borrower and each Subsidiary. By signing below,
-----------------------------------------
the Borrower and each Subsidiary hereby agrees to act in compliance with the
terms and restrictions of this Subordination Agreement and, in particular and
without limitation, to make no payment on the Subordinated Obligations to any
Subordinate Creditor until the Termination Date, except as otherwise permitted
pursuant to this Subordination Agreement.
Section 21. Notices. All notices, statements, requests and demands given
-------
to or made upon any party hereto in accordance with the provisions of this
Agreement shall be given by personal delivery, telecopy, first-class mail or
overnight courier, and such notice shall be effective when received. Notices
shall be given to the address for notices set forth on the signature page
hereof, or as any party may notify the other parties from time to time.
Section 22. Not Affected by Amendments. The provisions of this
--------------------------
Subordination Agreement shall remain in full force and effect regardless of any
amendment, modification or supplement to the Credit Obligation Instruments or
the Subordinated Instruments.
Section 23. Headings and References. The headings used herein are for
-----------------------
purposes of convenience on and shall not be used in construing the provisions
hereof. the words "this Subordination Agreement", "this instrument", "herein",
"hereof", "hereby" and words of similar import refer to this Subordination
Agreement as a whole and not to any particular subdivision unless expressly so
limited. Pronouns in masculine, feminine and neuter genders shall be construed
to include any other gender, and words in the singular form shall be construed
to include the plural and vice versa, unless the context otherwise requires.
Section 24. No Oral Change; Amendment. This Subordination Agreement may
-------------------------
not be changed orally, and no obligation of any party hereto may be released or
waived except by a writing signed by the party or parties to whom the obligation
is owed. Any of the provisions of this Agreement may from time to time be
amended, modified or waived by the Subordinated Creditors, the Lenders and the
Administrative Lender.
Section 25. Counterparts. This Subordination Agreement may be separately
------------
executed in any number of counterparts and by different parties hereto in
separate counterparts, each of
-10-
which when so executed shall be deemed to constitute one and the same
Subordination Agreement.
Section 26. Severability. Any provision of this Subordination Agreement
------------
which is for any reason prohibited or found or held invalid or unenforceable by
any court or governmental agency shall be ineffective to the extent of such
prohibition or invalidity or unenforceability without invalidating the remaining
provisions hereof in such jurisdiction or affecting the validity or
enforceability of such provision in any other jurisdiction.
SECTION 27. THIS WRITTEN AGREEMENT REPRESENTS THE FINAL AGREEMENT
BETWEEN THE PARTIES REGARDING THE SUBJECT MATTER COVERED HEREIN AND MAY NOT BE
CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS
OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.
================================================================================
REMAINDER OF PAGE LEFT INTENTIONALLY BLANK
================================================================================
-11-
IN WITNESS WHEREOF, this Subordination Agreement is executed as of the date
first above written.
COMPUSA HOLDINGS II INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------
Title: Vice President
------------------
Address for Notices to all
Subordinate Creditors:
CompUSA Inc.
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Senior Vice President and
General Counsel
PCs COMPLEAT, INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------
Title: Vice President
------------------
COMPUSA HOLDINGS I INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------
Title: Vice President
-------------------
-12-
COMPTEAM INC.
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------
Title: Vice President
-------------------
COMPUSA MANAGEMENT COMPANY
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------
Title: Vice President
------------------
COMPUSA STORES L.P.
By: COMPUSA INC., its general partner
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------
Title: Sr. V.P.- Secretary
-------------------
COMPUSA HOLDINGS COMPANY
By: /s/ ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------
Title: Sr. Vice President
-------------------
-13-
Address for Notices: NATIONSBANK OF TEXAS, N.A., as
Administrative Lender
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------------
Name: ▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-----------------------
Title: Senior Vice President
----------------------
CONSENTED AND AGREED TO:
COMPUSA INC.
By: /s/ ▇▇▇▇▇▇ ▇▇▇▇
-------------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇
--------------------------
Title:Vice Presidient - Finance
-------------------------
Address for Notices:
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇
Senior Vice President and
General Counsel
-14-
