Exhibit
10.4
RELEASE OF SECURITY INTEREST AND
SUBORDINATION AGREEMENT
(Liens)
This Release of Security
Interest and Subordination Agreement is made and entered into as of
the 17th day of October, 2006, by and between MARQUETTE COMMERCIAL
FINANCE, INC. (“MCF”) and GOTTBETTER
CAPITAL MASTER, LTD.
(“Creditor”) and is to witness the
following:
WHEREAS, MCF and Adsouth
Marketing, LLC (“Client”) entered into an Account
Transfer and Purchase Agreement (the “Purchase
Agreement”) under which MCF from time-to-time, purchases
accounts receivable (the "Accounts") from the Client;
and
WHEREAS, to secure all
present and future indebtedness, obligations and liabilities of the
Client to MCF (including, without limitation, under the Purchase
Agreement), Client granted MCF a security interest in, inter alia,
all of its present and future Accounts, general intangibles,
documents, instruments, chattel paper, contract rights and
inventory (all of which will hereafter collectively be referred to
as the “Collateral”); and
WHEREAS, Client also
grants MCF a security interest in each and every Account purchased
by MCF under the Purchase Agreement (“Purchased
Accounts”); and
WHEREAS, Client has
borrowed or has the right to borrow certain sums of money from,
obtained credit from or is otherwise obligated to Creditor;
and
WHEREAS, to secure the
indebtedness and obligations of Client to Creditor, Client has
granted or will grant to Creditor a security interest in certain of
its assets, including all of its Accounts and inventory;
and
WHEREAS, MCF and
Creditor desire to establish, as between themselves, the relative
priority and manner of enforcing their respective security
interests in, and rights with respect to, the Collateral and the
Purchased Accounts and to provide for certain other
matters.
NOW, THEREFORE, for and
in consideration of the foregoing, the mutual benefits to be
received by the
parties hereto, and the
covenants and agreements contained herein, MCF and Creditor agree
to the following:
1. Release of
Creditor's Security Interests . In consideration of the
increased liquidity provided to Client by the MCF purchase of
Purchased Accounts, which Creditor acknowledges is for a full, fair
and valuable consideration to Client, and which liquidity may be
instrumental in a reduction of the indebtedness or obligations by
Client to Creditor, Creditor hereby releases and discharges any
security interest in all Purchased Accounts and hereby waives any
and all claims or interest it has or might have in and with respect
to the Purchased Accounts, regardless of (a) when its interest
became perfected, (b) when the Purchased Accounts were purchased,
(c) the value of the Purchased Accounts, (d) the consideration
given or promised therefore, or (e) the amount Creditor is owed by
Client.
Creditor waives,
releases and discharges any interest it has or might have in any
Purchased Accounts as representative of the proceeds of any of
Client’s inventory or any payments received by MCF on the
Purchased Accounts as well as all goods returned under the
Purchased Accounts. Creditor further acknowledges and understands
that it has no interest of any kind or character, security or
otherwise, in the Purchased Accounts or the proceeds therefrom.
Creditor further waives any right it might have, by law or
otherwise, to receive notice, or any obligation on the part of MCF
to give notice, of any kind, at any time, of the purchase by MCF of
any or all of the Accounts. Upon such purchase, any interest,
security or otherwise, that Creditor has in such Purchased
Accounts, is automatically waived and released in and to such
Purchased Accounts without further action of any kind on the part
of MCF or Client.
2. Subordination of
Creditor's Security Interests . Without limiting or altering
the validity or effectiveness of the provisions in Section 1 herein
pertaining to the release and waiver of security interests in
Purchased Accounts, Creditor hereby subordinates its security
interest in the Collateral to the security interest of MCF in the
Collateral and Creditor agrees that its security interest, whenever
granted and/or perfected in the Collateral, will be inferior,
junior and secondary to the security interests held by MCF in the
Collateral. Creditor agrees that if Credi
