Exhibit
10.19(a)
INTERCREDITOR
AGREEMENT
This INTERCREDITOR
AGREEMENT is made by and among CARL BERG (“Creditor”),
and VENTURE BANKING GROUP, A DIVISION OF GREATER BAY BANK N.A.
(“Bank”).
RECITALS
A.
Bank proposes to lend funds to FOCUS ENHANCEMENTS, INC.
(“Borrower”) pursuant to a Loan and Security Agreement
of even date, as amended from time to time (the “Bank Loan
Agreement”).
B.
Creditor has extended loans or other credit accommodations to
Borrower, and/or may extend loans or other credit accommodations to
Borrower from time to time.
C.
This Agreement provides for certain matters of repayment and
sharing of Collateral between Bank and Creditor.
NOW THEREFORE, the
parties agree as follows:
1.
Bank Collateral . As used in this Agreement,
“Bank Collateral” means the following: all of
Borrower’s present and future “Accounts” (such
term as most broadly defined in the Bank Loan Agreement and the
California Uniform Commercial Code in effect on the date hereof);
and all proceeds of the foregoing.
2.
Creditor Collateral . As used in this Agreement,
“Creditor Collateral” means all of the property of
Borrower, now owned and hereafter acquired, other than the Bank
Collateral. (“Collateral” as used in this
Agreement shall mean Bank Collateral or Creditor Collateral, as the
case may be.)
3.
Subordination .
(a)
All security interests now or hereafter acquired by Creditor in
Creditor Collateral shall at all times be prior and superior to any
security interest or other interest or claim now held or hereafter
acquired by Bank in Creditor Collateral. (Bank and Creditor
are sometimes referred to herein as the
“Lenders.”)
(b)
All security interests now or hereafter acquired by Bank in the
Bank Collateral shall at all times be prior and superior to any
security interest, ownership interest, or other interest or claim
now held or hereafter acquired by Creditor in Bank Collateral.
(c)
The priorities specified in this Agreement shall be applicable
irrespective of the time or order of attachment or perfection of
any security interest or the time or order of filing of any
financing statements or other documents, or the giving of any
notices of purchase money security interests or other notices, or
possession of any Collateral, or any statutes, rules or law,
or court decisions to the contrary.
(d)
The subordinations and priorities specified in this Agreement are
expressly conditioned upon the nonavoidability and perfection of
the security interest to which another security interest is
subordinated, and if the security interest to which another
security interest is subordinated is not perfected or is avoidable,
for any reason, then the subordinations and relative priority
provided for in this Agreement shall not be effective as to the
particular Collateral which is the subject of the unperfected or
avoidable security interest.
4.
Termination Statements .
(a)
Bank agrees to execute and deliver to Creditor, promptly upon
Creditor’s request, appropriate UCC termination statements or
partial releases with respect to any Creditor Collateral being sold
or otherwise disposed of in connection with the liquidation of
Borrower’s assets upon or after the declaration of a default
or an event of default by Creditor under any present or future
instrument or agreement between the Borrower and Creditor.
The proceeds of any Creditor Collateral so sold or disposed of
shall be applied, after the deduction of any and all costs relating
to such sale or disposition (including attorneys’ fees,
advertising costs and auctioneer’s
1
fees) to any
and all outstanding present or future indebtedness, liabilities,
guaranties or other obligations of the Borrower to Creditor (the
“Creditor Obligations”) in such order as Creditor may,
in its discretion, determine and, only if all Creditor Obligations
have been indefeasibly paid in full, then to all or any part of the
present or future indebtedness, liabilities, guaranties or other
obligations of the Borrower to Bank (the “Bank
Obligations”) in such order as Bank may, in its discretion,
determine.
(b)
Creditor agrees to execute and deliver to Bank, promptly upon
Bank’s request, appropriate UCC termination statements or
partial releases with respect to any Bank Collateral being sold or
otherwise disposed of in connection with the liquidation of
Borrower’s assets upon or after the declaration of default or
an event of default by Bank under any present or future instrument
or agreement between the Borrower and Bank. The proceeds of
any Bank Collateral so sold or disposed of shall be applied, after
the deduction of any and all costs relating to such sale or
disposition (including attorney’s fees, advertising costs and
auctioneer’s fees) to any and all outstanding Bank
Obligations in such order as Bank, in its discretion, may
determine, and only if all Bank Obligations have been indefeasibly
paid in full, then to all or any part of the Creditor Obligations
in such order as Creditor, in its discretion, may determine.
5.
Lenders’ Rights . Bank and Creditor each agree
that the other may at any time, and from time to time, without the
consent of the other party and without notice to the other party,
renew, extend or increase any of the indebtedness, liabilities or
obligations owing to it from the Borrower (the “Secured
Obligations”) or that of any other person at any time
directly or indirectly liable for the payment of any Secured
Obligations, accept partial payments of the Secured Obligations,
settle, release (by operation of law or otherwise), compound,
compromise, collect or liquidate any of the Secured Obligations,
make loans or advances to the Borrower secured in whole or in part
by its Collateral or refrain from making any loans or advances to
the Borrower, change, alter or vary the interest charge on, or any
other terms or provisions of the Secured Obligations or any present
or future instrument, document or agreement with the Borrower, and
take any other action or omit to take any other action with
respe
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