Exhibit
10.5


 


EXHIBIT
E


 


SUBORDINATION
AGREEMENT


 


This SUBORDINATION AGREEMENT (this “Agreement”) is made as of the
      day of March     ,
2004, by and among JOSEPH L. SIMEK (“Mr. Simek”), FRANCES L. SIMEK (“Mrs.
Simek” and together with Mr. Simek, the “Subordinated Lenders”),
TIME AMERICA, INC., a Nevada corporation (“Borrower”),
and LAURUS MASTER FUND, LTD., a Cayman Islands company (“Senior Lender”).


 


PRELIMINARY
STATEMENTS:


 


WHEREAS, Borrower
and Senior Lender are about to enter into the Securities Purchase Agreement (as
hereinafter defined) whereby Borrower shall issue and sell and Senior Lender
shall purchase a note in the principal amount of $2,000,000 and a warrant to
purchase up to 280,000 shares of Company common stock;


 


WHEREAS, Borrower
has an outstanding balance owed to each of the Subordinated Lenders with regard
to the Subordinated Debt (as hereinafter defined); and


 


WHEREAS, a
condition to closing under the Securities Purchase Agreement is that payment
and performance of all Subordinated Debt be subordinated to the Senior Debt (as
hereinafter defined) to the extent and on the terms and conditions set forth
herein and that the Subordinated Lender enter into this Agreement to evidence
such subordination.


 


AGREEMENTS:


 


NOW THEREFORE, in
consideration of the foregoing premises and the mutual agreements herein
contained, and for other valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, Borrower, the Subordinated Lenders and Senior
Lender hereby agree as follows:


 


1.             Definitions.  The following terms shall have the meanings
specified below. Any reference to any renewal, extension, replacement or other
modification of any of the Senior Loan Documents that may be contained in the
definitions of the Senior Loan Documents set forth below shall not be deemed to
waive any consent of any respective Subordinated Lender to the extent such
consent is required under Section 4(b) below or otherwise limit in any way
any respective Subordinated Lender’s rights under Section 4(b). Any
reference to any renewal, extension, replacement or other modification of any
of the Subordinated Loan Documents that may be contained in the definitions of
the Subordinated Loan Documents set forth below shall not be deemed to waive
any consent of the Senior Lender to the extent such consent is required under
Section 6 below or otherwise limit in any way Senior Lender’s rights under
Section 6.


 


“Agreement”
shall have the meaning assigned to such term in the first paragraph of this
Agreement.


 

















 


“Borrower”
shall have the meaning assigned to such term in the first paragraph of this
Agreement.


 


“Collateral”
means all assets now or hereafter securing or intended to secure the payment
and performance of the Senior Debt and the Subordinated Debt including without
limitation all assets covered by any of the Senior Loan Security Documents and
the Subordinated Loan Security Documents.


 


 “Paid in
Full” or “Payment in Full” means, with respect to the
payment of the Senior Debt, that the Senior Debt has been fully, finally and
indefeasibly paid in cash and all of the financing arrangements and commitments
between Borrower and Senior Lender have been terminated.


 


“Permitted
Subordinated Lender Actions” means any lawful action taken by
any Subordinated Lender pursuant to their respective Subordinated Loan Security
Documents or applicable law in order to enforce payment of the Subordinated
Debt and their rights against the Collateral, but only to the extent such
action is permitted pursuant to Section 2.2(b) of this Agreement.


 


“Secured Convertible Term Note”
means that certain Secured Convertible Term Note issued
pursuant to the Securities Purchase Agreement by the Borrower to the Senior
Lender on the date even herewith in the principal amount of $2,000,000,
together with all extensions, modifications, substitutions or renewals thereof.


 


“Securities Purchase Agreement”
means that certain securities Purchase Agreement which the
execution of this Agreement is a condition precedent with this Agreement,
between Senior Lender and Borrower, regarding the issuance and sale of a
$2,000,000 note and warrant to purchase 280,000 shares of the Borrower’s common
stock.


 


“Senior Debt”
means the debt evidence by the Secured Convertible Term Note.


 


“Senior
Lender” shall have the meaning assigned to such term in the
first paragraph of this Agreement.


 


“Senior
Loan Documents” means any and all documents, instruments or
agreements now or hereafter evidencing, securing or executed in connection with
the Senior Debt including, without limitation, the Securities Purchase
Agreement, the Secured Convertible Term Note, the Senior Loan Security
Documents and any other instruments or agreements now or hereafter executed in
connection therewith, as any such documents may be restated, amended, supplemented
or otherwise modified from time to time.


 


“Senior
Loan Security Documents” means, singly and collectively any
documents, instruments or agreements now or hereafter securing, or intended to
secure, the Senior Debt, including without limitation, the Security Agreement
by Borrower, dated of even date herewith (until released in accordance with its
terms).


 


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“Subordinated
Debt” means the amounts owing on the Subordinated Notes and any
other loans or indebtedness hereafter provided by any Subordinated Lender to
Borrower, however evidenced.


 


“Subordinated
Notes” mean (i) that certain Promissory Note issued by Borrower
to Mrs. Simek, on September 4, 2001, in the aggregate principal amount of
$500,000, (ii) that certain promissory note issued by Borrower to Mr. Simek on
March 31, 2001, in the aggregate principal amount of $400,000, and (iii)
that certain Promissory Note issued by Borrower to Mr. Simek on
November 2, 2001, in the aggregate principal amount of $200,000, each
together with all extensions, modifications, substitutions or renewals thereof.


 


 “Subordinated Lenders” shall have the
meaning assigned to such term in the first paragraph of this Agreement.


 


“Subordinated
Loan Documents” means the Subordinated Notes, the Subordinated
Loan Security Documents, and all other documents and instruments now or
hereafter evidencing, securing or executed in connection with the Subordinated
Debt.


 


“Subordinated
Loan Security Documents” means, singly and collectively any
documents, instruments or agreements now or hereafter securing, or intended to
secure, the Subordinated Debt.


 


2.             Subordination.


 


2.1           Payments on
Subordinated Debt.  Except as
otherwise provided in this Agreement, each of the Subordinated Lenders agrees
that it will not ask for, demand, sue for, or take or receive from Borrower or
any successor or assign of Borrower, including a receiver, trustee or debtor in
possession, whether by setoff or in any other manner, the whole or any part of
the Subordinated Debt, unless and until all of the Senior Debt shall have been
Paid in Full.  Notwithstanding the
foregoing sentence to the contrary, so long as (i) Senior Lender has received
all payments then due and owing under the Senior Loan Documents; and (ii) Senior
Lender has not delivered to the Subordinated Lenders written notice of the
occurrence of an event of default under the Senior Loan Documents, then,
Borrower may pay to the Subordinated Lenders, and the Subordinated Lenders may
accept and retain from Borrower payments of principal and interest on the
Subordinated Debt (the “Permitted Payments”).  If Permitted Payments are suspended, in the
case of an event of default under the Senior Loan Documents, such Permitted
Payments may be resumed only after such an event of default is cured or waived
or after the Senior Debt is Paid in Full.


 


2.2           Subordinated Lenders’
Liens.


 


(a)           Notwithstanding the
date, manner or order of perfection or attachment of the security interests and
liens granted by Borrower to Senior Lender or any Subordinated Lender, and
notwithstanding the usual application of the priority provisions of the UCC or
any other applicable law or judicial decision, or whether Senior Lender or any
Subordinated Lender holds possession of all or any part of the Collateral,
Senior Lender shall have a first and prior continuing security interest in and
lien on the Collateral, and Subordinated Lender shall have a security interest
therein subordinate in priority to the lien and security


 


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interest held by Senior Lender.  Senior Lender and the Subordinated Lenders
nevertheless, each agree to make such filings and recordings in the public
records to evidence the priorities made herein as the other may reasonably request.


 


(b)           Each Subordinated
Lender agrees that such Subordinated Lender will not without Senior Lender’s
written permission and in concert with and at the direction of Senior
Lender:  (a) commence any action or
proceeding or otherwise take action against Borrower to recover all or any
portion of the Subordinated Debt, including any action to foreclose or realize
upon any Collateral securing the Subordinated Debt; or (b) commence, or join
with any creditor, other than Senior Lender, in commencing, directly or
indirectly, or cause Borrower to commence, or assist Borrower in commencing,
any proceeding under any bankruptcy, insolvency, reorganization, receivership
or similar laws for arrangement of debts of Borrower.


 


(c)           Except as provided in
Section 2.2(b) above and subject at all times to Senior Lender’s prior and
superior lien in the Collateral, in the event any payment or distribution to
any Subordinated Lender is made from any of the Collateral upon or with respect
to any of the Subordinated Debt, other than any payments of principal and
interest which such Subordinated Lender is permitted to accept and retain
hereunder, prior to the time all of the Senior Debt shall have been fully,
finally and indefeasibly paid, such Subordinated Lender shall receive and hold
the same in trust, as trustee, for the benefit of Senior Lender and shall
immediately deliver the same to Senior Lender in precisely the form received
for application against the Senior Debt, whether due or not due, and, until so
delivered, the same shall be held in trust by such Subordinated Lender as the
property of Senior Lender.


 


(d)           The provisions of this
Agreement are applicable regardless of whether the security interest and/or
lien of Senior Lender in the Collateral is not perfected or is voidable for any
reason.


 


2.3           Payments Held in
Trust.  In the event that any
Subordinated Lender shall receive any payment, or security for payment, on the
Subordinated Debt which such Subordinated Lender is not entitled to receive or
accept under the provisions of this Section 2, such Subordinated Lender
will hold any such amount or security so received as trustee of an express
trust for the sole and exclusive benefit of Senior Lender, and such
Subordinated Lender will forthwith assign and turn over the same to Senior
Lender, in the form received, properly endorsed and assigned, to be applied to
payment of or held by Senior Lender, as security for the Senior Debt, as the
case may be.  In the event of any
failure by such Subordinated Lender to make any such endorsement or assignment,
Senior Lender is hereby irrevocably authorized, as attorney-in-fact for the
respective Subordinated Lender, to make the same.


 


3.             Further Limitations
on Actions of Subordinated Lenders.


 


3.1           Other than Permitted
Subordinated Lender Actions (which Subordinated Lenders may take at any time,
but only to the extent permitted by this Agreement and the Subordinated Loan
Documents and applicable law), until Senior Lender has received Payment in Full
of all Senior Debt, no Subordinated Lender shall enforce or exercise, or seek
to enforce or exercise, any right of acceleration or demand, or commence any
other action or proceeding


 


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(including without limitation the initiation of any
legal proceedings) to collect all or any part of the Subordinated Debt.


 


3.2           Senior Lender hereby
approves the execution and delivery of the Subordinated Loan Documents as the
same exist as of the date hereof and acknowledges that such execution and
delivery shall not constitute an event of default under the Senior Loan
Documents.


 


4.             Continuing
Subordination.  The subordination
effected by this Agreement is a continuing subordination and may not be
modified or terminated by any Subordinated Lender or any other holder of any
Subordinated Debt until all of the Senior Debt shall have been Paid in Full. At
any time and from time to time, without the consent of or notice to the
Subordinated Lenders or any other holder of any Subordinated Debt, and without
impairing or affecting the obligations of any of them hereunder:


 


4.1           Senior Lender may
exercise or refrain from exercising any rights or remedies against Borrower
subject to each respective Subordinated Lender’s rights pursuant to
Section 2.2(b) of this Agreement;


 


4.2           The Senior Loan
Documents may be revised, amended or otherwise modified for the purpose of
adding or changing any provisions thereof or changing in any manner the rights
of Senior Lender and/or Borrower;


 


4.3           The terms of this
Agreement shall continue in full force and effect in the event that all or any
portion of the Senior Debt is refunded, refinanced, or extended and the term
“Senior Debt” shall include any Senior Debt which is refunded, refinanced or
extended on one or more occasions, and in any such case, the terms “Securities
Purchase Agreement” and “Senior Loan Documents” and the like as used herein
shall refer to the agreements and instruments executed in connection with any
such refunding, refinancing or extension;


 


4.4           Subject to the
provisions of Section 5 of this Agreement, the maturity of the Senior Debt
may be accelerated after the occurrence of an event of default and any
Collateral or any other rights of Senior Lender may be exchanged, sold,
surrendered, released or otherwise dealt with in any lawful manner; and


 


4.5           Any person liable in
any manner for payment of all or any part of the Senior Debt may be released.


 


Notwithstanding the
occurrence of any of the foregoing, the provisions of this Agreement shall
remain in full force and effect.


 


5.             No Modification of
Subordinated Debt.  Until the Senior
Debt shall have been Paid in Full, neither Borrower nor any Subordinated Lender
shall amend, modify or terminate the Subordinated Notes, or any other
Subordinated Loan Document (as the same exist on the date hereof) without the
prior written consent of Senior Lender, which consent shall not be unreasonably
withheld; and any such purported amendment, modification or termination without
such consent shall be ineffective; this prohibition includes, but not by way of
limitation, any acceleration of the amortization schedule of the
Subordinated Debt and any increase in the rate


 


5

















 


of interest that accrues thereon. Notwithstanding the
foregoing, any Subordinated Lender may agree to amend their respective
Subordinated Loan Documents without Senior Lender’s consent to (i) reduce the
interest rate, (ii) extend the maturity of any principal amount or interest due
thereunder, or (iii) waive or otherwise delete any provision thereof with
respect to such Subordinated Lender’s rights thereunder, provided  that
a copy of any such amendment shall be provided to Senior Lender
contemporaneously with the execution thereof. Any reference to any renewal,
extension, replacement or other modification of any of the Subordinated Loan
Documents that may be contained in the definition of any of the Subordinated
Loan Documents set forth in this Agreement shall not be deemed to waive the
consent required by this Section 5 or otherwise limit in any way Senior
Lender’s rights under this Section 5.


 


6.             Senior Debt and
Subordinated Debt Default and Default Notices.


 


6.1           If an event of default
shall occur under or within the meaning of any of the Senior Loan Documents, a
default and event of default shall occur under the Subordinated Lender
Documents.  Any notice of an “event of
default” under the Senior Loan Documents which Senior Lender sends to Borrower
shall also be simultaneously sent to Subordinated Lenders (and their counsel)
at the address set forth in Section 13 below.


 


6.2           If a default or event
of default shall occur under or within the meaning of any of the Subordinated
Lender Documents, an event of default shall occur under the Senior Loan
Documents.  Any notice of “default” or
“event of default” under the Subordinated Loan Documents which any respective
Subordinated Lender sends to Borrower shall also be simultaneously sent to
Senior Lender (and its counsel) at the addresses set forth in Section 13
below.


 


7.             Bankruptcy
Financing Issues.  This Agreement
shall continue in full force and effect after the filing of any petition for
relief by or against Borrower under the United States Bankruptcy Code (the “Code”) and all converted or succeeding
cases in respect thereof (all references herein to Borrower being deemed to
apply to Borrower as debtor-in-possession and to a trustee for Borrower), and
shall apply with full force and effect with respect to all Collateral acquired
by Borrower, and to all Senior Debt and Subordinated Debt incurred by Borrower,
subsequent to such filing.  If Borrower
shall become subject to a proceeding under the Code, and if the Senior Lender
shall desire to permit the use of cash collateral by Borrower or to provide
post-petition financing from the Senior Lender to Borrower, each Subordinated
Lender agrees as follows:  (a) no notice
need be provided to any respective Subordinated Lender for such use of cash
collateral or such post-petition financing; and (b) no objection will be raised
by the Subordinated Lenders to any such use of cash collateral or such
post-petition financing from the Senior Lender.  No objection will be raised by the Subordinated Lenders to the
Senior Lender’s motion for relief from automatic stay in any such proceeding to
foreclose on, sell or otherwise realize upon the Collateral.  In case of any assignment by Borrower for
the benefit of creditors, and in case of the appointment of any receiver for
Borrower or Borrower’s business or assets, and in case of any dissolution or
other winding up of the affairs of Borrower, or of Borrower’s business, and in
all such cases respectively, the officer of Borrower and any assignee, trustee
in bankruptcy, receiver, and other person or persons in charge, are hereby
directed to pay to Senior Lender the full amount of Senior Lender’s claims
against Borrower before making any payment to any Subordinated Lender, and so
far as may be necessary for that purpose, the Subordinated


 


6

















 


Lenders hereby transfer and assign to Senior Lender
all their rights to any payment or distribution which might otherwise be coming
to it.  Senior Lender is hereby
irrevocably constituted and appointed the attorney-in-fact of the Subordinated
Lenders to file any and all proofs of claim and any other documents and to take
all other action, either in the name of Senior Lender or any Subordinated
Lender, which in the opinion of Senior Lender is necessary or desirable to
enable Senior Lender to obtain all such payments.


 


8.             Transfers: Binding
Effect.


 


8.1           Subject to
Section 8.2 below, Senior Lender shall have the right to sell, assign,
transfer or otherwise dispose of any of the Senior Debt, or any interest
therein, from time to time, without the prior consent of any other party
hereto.


 


8.2           This Agreement shall
extend to and bind the respective successors, assigns, and transferees of the
parties hereto and shall inure to the benefit of any such successor, assignee
or transferee but shall not otherwise create any rights or benefits for any
third party.


 


9.             Headings.  The headings in this Agreement are for
convenience of reference only and shall not after or otherwise affect the
meaning hereof.


 


10.           Conflicts with
Senior or Subordinated Loan Documents. 
Notwithstanding any term or provision of the Senior Loan Documents or
the Subordinated Loan Documents or any other agreement to which Borrower,
Senior Lender or the Subordinated Lenders are a party or by which any of them
is bound, in the event that any term or provision of any such instrument or agreement
conflicts or is inconsistent with the terms and provisions of this Agreement,
until such time as the Senior Debt shall have been Paid in Full, the terms and
provisions of this Agreement shall control.


 


11.           Governing Law.  THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW
YORK, WITHOUT REGARD TO SUCH STATE’S PRINCIPLES OF CONFLICT OF LAWS.


 


12.           Waivers: Amendments,
Etc.  Neither this Agreement nor any
of the terms hereof may be amended, waived, discharged or terminated unless
such amendment, waiver, discharge or termination is in writing signed by each
of Senior Lender and each Subordinated Lender.


 


13.           Notice.  Any notices or other communications required
or permitted to be given hereunder must be given in writing and (i) personally
delivered or (ii) mailed by prepaid certified or registered mail or by Federal
Express or similar courier service, to the party to whom such notice of
communication is directed, to the address of such party as follows:


 


(a)           Mrs.
Simek:


 


Mrs. Frances L. Simek


860 Vega Lane


Medford, WI 
54451


 


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with a copy to:


 


Robert W. Zimmerman, Esq.


Mallery & Zimmerman, S.C.


101 Grand Avenue


PO Box 479


Wausau, WI


 


(b)           Mr.
Simek:


 


Mr. Joseph Simek


860 Vega Lane


Medford, WI 
54451


 


with a copy to:


 


Robert W. Zimmerman, Esq.


Mallery & Zimmerman, S.C.


101 Grand Avenue


PO Box 479


Wausau, WI


 


(c)           Senior
Lender:


 


Laurus Master Fund, Ltd.


c/o Ironshore Corporate
Services Ltd.


PO Box 1234 G.T.


Queensgate House, South
Church Street


Grand Cayman, Cayman
Islands


Facsimile: (345) 949-9877


 


with a copy to:


 


John E. Tucker, Esq..


825 Third Avenue 14th
Floor


New York, NY  10022


Facsimile:  (212) 541-4434


 


(d)           Borrower:


 


Time America, Inc.


51 West Third Street


Suite 310


Tempe, Arizona  85281


Telephone:  480-967-5800


Attn:
   Thomas S. Bednarik


President and Chief
Executive Officer


 


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with copies to:


 


Squire, Sanders &
Dempsey L.L.P.


Two Renaissance Square


40 North Central Avenue,
Suite 2700


Phoenix, Arizona  85004-4498


Telephone:  602-528-4134


Facsimile:  602-253-8129


Attn:
     Gregory R. Hall, Esq.


 


Any such notice or other
communication shall be deemed to have been given (whether actually received or
not) on the day it is mailed or personally delivered as aforesaid. Any party
may change its address for purposes of this Agreement by giving notice of such
change to the other parties pursuant to this Section 13.


 


14.           Multiple
Counterparts.  This Agreement may be
executed in any number of counterparts, all of which taken together shall
constitute one and the same agreement, and any of the parties hereto may
execute this Agreement by signing any such counterpart.


 


15.           Further Assurances.  Each of the parties hereto hereby agree to
promptly execute and deliver to the other parties hereto any and all such
further instruments and documents and to take such further action as such other
parties may at any time reasonably request in order to fully effect the
purposes of this Agreement.


 


16.           Reliance by Senior
Lender; Waiver of Notices; No Representations by Senior Lender; Management of
Credit Facilities by Senior Lender. 
All of the Senior Debt shall be deemed to have been made or incurred in
reliance upon this Agreement.  Each
Subordinated Lender expressly waives all notice of the acceptance by Senior
Lender of the provisions of this Agreement and all other notices not
specifically required pursuant to the terms of this Agreement.  Each Subordinated Lender agrees that Senior
Lender has not made any representation or warranty with respect to the due
execution, legality, validity, completeness or enforceability of any of the
Senior Loan Documents, the perfection or priority or any security interest or
lien securing any or all of the Senior Debt or the collectibility of any of the
Senior Debt.  Senior Lender shall be
entitled to manage and supervise its credit facilities with Borrower in
accordance with applicable law and its usual business practices (subject to the
provisions of this Agreement), modified from time to time as it deems
appropriate under the circumstances, and Senior Lender shall have no liability
to any Subordinated Lender for any loss, claim or damage allegedly suffered by
any Subordinated Lender in any proceeding by Senior Lender to foreclose or
otherwise enforce any of its security interests in and/or liens on any of the
Collateral.


 


17.           Financial Condition
of Borrower.  Each Subordinated
Lender hereby assumes responsibility for keeping itself informed of the
financial condition of Borrower and any and all guarantors of the Subordinated
Debt and of all other circumstances bearing upon the risk of nonpayment of the
Subordinated Debt that diligent inquiry would reveal and each Subordinated


 


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Lender hereby agrees that Senior Lender shall have no
duty to advise any Subordinated Lender of any information regarding such
condition or any such circumstances.


 


18.           Miscellaneous.


 


18.1         Every word herein importing
the singular number shall also be construed to extend to and include the plural
number also and vice versa.


 


18.2         In the event that any
term or provision of this Agreement or the application thereof to any person or
circumstance shall, to any extent, be held invalid or unenforceable, the
remainder of this Agreement or the application of such term or provision to
persons or circumstances than those to which it is held invalid or
unenforceable, shall be valid and enforceable to the fullest extent permitted
by law.


 


18.3         This Agreement and all
covenants, agreements, representations and warranties made herein shall survive
and continue in full force and effect until such time as all of the Senior Debt
has been indefeasibly Paid in Full.


 


18.4         The parties acknowledge
that each party and its respective counsel have reviewed and revised this
Agreement and agree that any rule of construction to the effect that
ambiguities are to be resolved against the drafting party shall not apply in
the interpretation of this Agreement.


 


18.5         Neither Senior Lender nor
any Subordinated Lender shall be deemed to have waived any of their respective
rights or remedies under this Agreement unless such waiver is in writing and
signed by the party to be charged.  No
delay or omission on the part of any party in exercising any such right or
remedy shall operate as a waiver of any such right or remedy or any other right
or remedy.  A waiver on any one occasion
shall not be construed as bar to or a waiver of the same right or remedy on any
future occasion.  Without limiting the
generality of the foregoing, Senior Lender’s acquiescence in the payment of any
sum to any Subordinated Lender in contravention of the terms of this Agreement
shall not constitute a waiver of the right of Senior Lender to require prompt
performance of any and all of the covenants contained in this Agreement.


 


18.6         Time is of the essence
with respect to the payment, performance and observance of each of the
covenants of each of the parties to this Agreement.


 


18.7         Each party hereto
acknowledges that to the extent that no adequate remedy at law exists for
breach of its obligations under this Agreement in the event any party fails to
comply with its obligations hereunder, the other party shall have the right to
obtain specific performance of the obligations of such defaulting party,
injunctive relief or such other equitable relief as may be available.


 


18.8         The failure of any party
to perform any of the terms, covenants or conditions set forth in this
Agreement shall not alter, or be deemed to alter, in any way the subordination
provisions hereof or the relative priorities established hereby.


 


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19.           NO REFINANCING
COMMITMENT.  Borrower and
Subordinated Lenders each hereby acknowledge and agree that notwithstanding any
references herein to the refunding, refinancing or extension of the Senior
Debt, the Senior Lender has not impliedly or expressly committed to provide any
such refunding, refinancing or extension nor have any terms of any such
refunding, refinancing or extension been in any way agreed to.  Borrower and Senior Lender hereby
acknowledge and agree that notwithstanding any references herein to the
refinancing or extension of the Subordinated Debt, no Subordinated Lender has
impliedly or expressly committed to provide such refinancing or extension, nor
has any terms of any such refinancing or extension been in any way agreed to.


 


20.           FINAL AGREEMENT.  THIS WRITTEN SUBORDINATION AGREEMENT, THE
SENIOR LOAN DOCUMENTS AND THE SUBORDINATED LOAN DOCUMENTS REPRESENT THE FINAL
AGREEMENT AMONG THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO
ORAL AGREEMENTS AMONG THE PARTIES.


 


21.           WAIVER OF JURY TRIAL.  EACH PARTY TO THIS AGREEMENT HEREBY
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES THE RIGHT TO A TRIAL BY JURY IN
RESPECT OF ANY LITIGATION BASED UPON THIS AGREEMENT OR THE SENIOR LOAN
DOCUMENTS OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH THE TRANSACTIONS OF
WHICH THIS AGREEMENT IS A PART, OR ANY COURSE OF CONDUCT, COURSE OF DEALINGS,
STATEMENTS (WHETHER ORAL OR WRITTEN). OR ACTIONS BY ANY PARTY. THIS MUTUAL
WAIVER IS GIVEN AS A MATERIAL INDUCEMENT FOR THE PARTIES TO EXECUTE THIS AGREEMENT.


 


[Signatures
on following page]


 


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IN WITNESS
WHEREOF, the parties hereto by their duly authorized representatives have
executed this Agreement as an instrument under seal as of the date first above
written.


 


	
   

  	
  SUBORDINATED
  LENDERS:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  FRANCES L. SIMEK

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  JOSEPH L. SIMEK

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  SENIOR
  LENDER:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  LAURUS MASTER FUND,
  LTD., a Cayman

  Islands company,

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  BORROWER:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  TIME AMERICA, INC., a
  Nevada corporation

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
  Name:

  	
   

  	
   

  
	
   

  	
  Title:

  	
   

  	
   

  
										



 


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