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Exhibit
10.46
SUBORDINATION AND
INTERCREDITOR AGREEMENT
T HIS S
UBORDINATION AND I
NTERCREDITOR A GREEMENT (this
“ Agreement ”) is made as of this 25th
day of May, 2007 by and among (1) NEIPF, L.P.
(including its successors and assigns, “ NEIPF
”), (2) C OLUMBIA P
ARTNERS , L.L.C. I NVESTMENT M
ANAGEMENT , as “ Investment
Manager ” and (3) S ILICON V
ALLEY B ANK (including its
successors and assigns, “ SVB ”). NEIPF
and SVB are sometimes referred to individually as “
Lender ” and together as “
Lenders .”
R
ECITALS
A. V
ERTICAL C OMMUNICATIONS , I
NC . (“ VCI ”), V
ERTICAL C OMMUNICATIONS A
CQUISITION C ORP . (“
VCAC ”), V ODAVI T
ECHNOLOGY , I NC . (“
Vodavi ”) and V ODAVI C
OMMUNICATIONS S YSTEMS , I
NC . (“ Vodavi Comm ,”
and together with VCI, VCAC, and Vodavi, the “
Borrowers ” and each a “
Borrower ”) have obtained from NEIPF a loan
facility for working capital purposes (the “ NEIPF
Loan ”) pursuant to the terms and conditions of a
Credit Agreement dated as of October 18, 2006, by and among
the VCI, VCAC, Investment Manager and NEIPF and certain other
signatories thereto and a Joinder Agreement by Vodavi in favor of
Investment Manager and NEIPF dated December 4, 2006 and a
Joinder Agreement by Vodavi Comm in favor of Investment Manager and
NEIPF dated May 25, 2007 (such Credit Agreement and Joinder
Agreement, together the “ NEIPF Credit
Agreement ”). Borrowers’ obligations under the
NEIPF Credit Agreement are secured by security interests in favor
of Investment Manager and NEIPF in all of the
Collateral.
B. SVB has made a
revolving line of credit available to Borrowers (hereafter, “
SVB Loan ”) in accordance with the terms of
that certain Loan and Security Agreement among SVB and the
Borrowers dated May 25, 2007 (the “ SVB Loan
Agreement ”). Borrowers’ obligations under the
SVB Loan Agreement are secured by security interests in favor of
SVB in all of the Collateral.
C. The parties have
entered into this Agreement to set forth the relative priorities of
each party’s security interests in the Collateral.
A
GREEMENT
N OW , T
HEREFORE , for good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the
parties agree as set forth below.
SECTION 1. Certain
Definitions . In addition to the terms defined in the recitals
hereto, the following terms shall have the following meanings for
the purposes of this Agreement:
SECTION 1.1
Accounts Receivable . The term “ Accounts
Receivable ” means Borrowers’
“Accounts”, as such term is defined in the SVB Loan
Agreement as of the date hereof (without giving any effect to any
amendment of such definition after the date hereof), and all
proceeds thereof.
SECTION 1.2 Cash
Collateral Account . The term “ Cash Collateral
Account ” shall have the meaning give to that term in
the SVB Loan Agreement as of the date hereof (without giving any
effect to any amendment of such definition after the date hereof),
and shall include all cash or other deposits on deposit
therein.
SECTION 1.3
Code . The term “ Code ” shall
mean with respect to the Collateral the Uniform Commercial Code as
may, from time to time, be enacted and in effect in the State of
New York or the Commonwealth of Massachusetts, as
applicable.
SECTION 1.4
Collateral . The term “ Collateral
” shall mean “Collateral) as defined in the SVB Loan
Agreement or the NEIPF Loan Agreement, as applicable, including
without limitation in each case, all of the real, personal and
mixed assets, property and interests in property of Borrowers,
whether now owned or hereafter acquired (whether by purchase or
lease), including, without limitation, all of Borrowers’
accounts, inventory, equipment, motor vehicles, documents,
instruments, fixtures, general intangibles, chattel paper, contract
rights, and records relating thereto, together with the proceeds
and products thereof.
SECTION 1.5
Collection Action . The term “ Collection
Action ” shall mean any of the following actions by
any Lender: (a) ask, demand, sue for, take or receive from or
on behalf of Borrowers, by set-off or in any other manner, the
whole or any part of any monies which may now or hereafter be owing
by Borrowers to Lender on such Lender’s Debt (other than the
receipt of payments in the ordinary course of business in
accordance with the SVB Documents or the NEIPF Documents, as the
case may be, prior to the occurrence of an Event of Default),
(b) initiate or participate with others in any suit, action or
proceeding against Borrowers to enforce payment of or to collect
the whole or any part of such Lender’s Debt, (c) ask,
demand, take or receive any additional security for any of such
Lender’s Debt, or (d) initiate or participate with
others in any action to realize upon such Lender’s Security
Interest or any of the assets of Borrowers. “Collection
Action” shall not include the acceleration of payment of such
Lender’s Debt.
SECTION 1.6
Designated Deposit Account . The term “
Designated Deposit Account ” shall have the
meaning given to that term in the SVB Loan Agreement as of the date
hereof (without giving any effect to any amendment of such
definition after the date hereof), and shall include all cash or
other deposits or deposit therein.
SECTION 1.7 Event
Of Default . The term “ Event of Default
” shall have the meaning given that term in the NEIPF
Documents and the SVB Documents, as the case may be.
SECTION 1.8
Indefeasibly Paid . The term “ Indefeasibly
Paid ” shall mean, with respect to the making of any
payment or in respect of any Lender’s Debt, a payment in cash
of such Lender’s Debt in full, which payment is not subject
to avoidance or rescission in any Insolvency Proceeding that has
been commenced at or within ninety (90) days of the time of
such payment.
2.
SECTION 1.9
Insolvency Proceeding . The term “ Insolvency
Proceeding ” shall mean (a) any case, action or
proceeding before any court or other authority relating to
bankruptcy, reorganization, insolvency, liquidation, receivership,
dissolution, winding-up, charter revocation or forfeiture,
arrangement, adjustment, composition, or relief of debtors, or
(b) any general assignment for the benefit of creditors,
composition, marshaling of assets for creditors, or other, similar
arrangement in respect of its creditors generally or any
substantial portion of its creditors; in each instance, undertaken
under Federal, state or foreign law.
SECTION 1.10
Inventory . The term “ Inventory ”
means Borrowers’ “Inventory”, as such term is
defined in the SVB Loan Agreement as of the date hereof (without
giving any effect to any amendment of such definition after the
date hereof), and all proceeds thereof.
SECTION 1.11
Lender’s Debt . The term “ Lender’s
Debt ” means either the NEIPF Debt or the SVB Debt,
as the case may be or the context may require.
SECTION 1.12
Lender’s Documents . The term “
Lender’s Documents ” means either the
NEIPF Documents or the SVB Documents as the case may be or the
context may require.
SECTION 1.13 NEIPF
Debt . The term “ NEIPF Debt ” shall
mean the indebtedness, obligations and liabilities now or hereafter
owed by Borrowers to NEIPF under the NEIPF Documents as such may be
amended or modified from time to time(including without limitation
the NEIPF Loan and the payment of any indebtedness arising under
any other instrument benefiting NEIPF), and any renewals
thereof.
SECTION 1.14 NEIPF
Documents . The term “ NEIPF Documents
” shall mean and include the NEIPF Credit Agreement and all
other instruments or agreements now or hereafter evidencing or
securing the whole or any part of the NEIPF Debt, as the same may
be amended or modified from time to time.
SECTION 1.15 NEIPF
Security Interest . The term “ NEIPF Security
Interest ” shall mean the liens and security
interests with respect to the Collateral granted by Borrowers, as
debtors, to NEIPF and Investment Manager, as secured parties,
pursuant to the NEIPF Documents.
SECTION 1.16 NEIPF
Senior Collateral . The term “ NEIPF Senior
Collateral ” shall mean all Collateral not
constituting SVB Senior Collateral.
SECTION 1.17
Security Interests . The term “ Security
Interests ” shall mean, collectively, the SVB
Security Interests and NEIPF Security Interests. Security Interest
shall mean either of the aforementioned, as the case may be or the
context may require.
SECTION 1.18 SVB
Debt . The term “ SVB Debt ” shall
mean the indebtedness, obligations and liabilities now or hereafter
owed by Borrowers to SVB under the SVB Documents, as such may be
amended or modified from time to time (including without
limitation, the SVB Loan and the payment of any indebtedness
arising under any other instrument benefiting SVB), and any
renewals thereof.
3.
SECTION 1.19 SVB
Documents . The term “ SVB Documents
” shall mean and include the SVB Loan Agreement, the SVB
Security Agreements and all other instruments or agreements
evidencing or securing the whole or any part of the SVB Debt, as
the same may be amended or modified from time to time.
SECTION 1.20 SVB
Security Agreements . The term “ SVB Security
Agreements ” shall mean the SVB Loan Agreement, and
all other similar documents executed by Borrowers and creating the
SVB Security Interest, as the same may be amended or modified from
time to time.
SECTION 1.21 SVB
Security Interest . The term “ SVB Security
Interest ” shall mean the liens, security interests
and any other rights with respect to the Collateral granted by
Borrowers, as debtors, to SVB, as secured party, pursuant to the
SVB Documents.
SECTION 1.22 SVB
Senior Collateral . The term “ SVB Senior
Collateral ” shall mean all Accounts Receivable and
Inventory, the Designated Deposit Account and the Cash Collateral
Account.
SECTION 2. Consent .
SVB and NEIPF hereby consent to the making of the other
Lender’s respective loans and credit extensions to Borrowers
and to the granting and existence of the Security Interests,
despite any prohibitions which might exist in the NEIPF Documents
or the SVB Documents, and each SVB and NEIPF consents to the
Borrowers’ payment of their indebtedness and obligations
under and in accordance with the terms of the NEIPF Documents and
the SVB Documents, as applicable.
SECTION 3. Priority of
Liens and Security Interests . Lenders agree and declare that
at all times, whether before, after, or during the pendency of any
bankruptcy, reorganization or other Insolvency Proceeding, and
notwithstanding the priorities which would ordinarily result from
the order of the granting of any such Security Interest, or the
order, sequence or date of the filing of any financing statements,
or obtaining of possession or control (whether pursuant to a
control agreement or automatically as prescribed by the Code),
notwithstanding the right to set off which may exist under the
NEIPF Documents or the SVB Documents (which shall include for such
purposes any account agreement between any Borrower and SVB) and
whether or not perfected or unavoidable: (a) the NEIPF
Security Interest shall constitute and be a senior and superior
security interest, lien and charge in and upon the NEIPF Senior
Collateral and prior in right to any interest of SVB in the NEIPF
Senior Collateral howsoever arising, and that SVB’s Security
Interest shall be subject and subordinate to the NEIPF Security
Interest with respect to the NEIPF Senior Collateral, and
(b) the SVB Security Interest shall constitute and be a senior
and superior security interest, lien and charge in and upon the SVB
Senior Collateral and prior in right to any interest of NEIPF in
the SVB Senior Collateral howsoever arising, and that NEIPF
Security Interest shall be subject and subordinate to SVB Security
Interest with respect to the SVB Senior Collateral. The parties
agree that the records shall reflect the respective priorities of
their Security Interests.
SECTION 4. Subordination;
Standby — SVB . SVB shall not take any Collection Actions
with respect to the NEIPF Senior Collateral, unless and until the
NEIPF Debt shall have been fully paid and satisfied, except as
authorized pursuant to Section 8 of this Agreement.
This
4.
subordination provision shall apply with
respect to all of the SVB Debt, regardless of how or in what manner
the SVB Debt is incurred, or whether the SVB Debt has already been
incurred or may be incurred in the future by future advances or
other financial accommodations made or extended by SVB, or whether
such future advances or other financial accommodations are made at
the discretion of SVB under the SVB Documents or pursuant to
commitment, collection efforts or otherwise. If SVB in violation of
this Agreement shall attempt any Collection Action (other than a
Collection Action with respect to the SVB Senior Collateral (other
than the Designated Deposit Account) or as permitted pursuant to
Section 8 of this Agreement), then NEIPF and Investment
Manager may interpose as a defense or plea the making of this
Agreement and NEIPF and Investment Manager may intervene and
interpose such defense in its name or in the name of Borrowers, and
NEIPF and Investment Manager may by virtue of this Agreement
restrain the enforcement thereof in the name of Borrowers, or
NEIPF.
SECTION 5. Subordination;
Standby – NEIPF, Investment Manager . Neither NEIPF nor
Investment Manager shall take any Collection Actions with respect
to the SVB Senior Collateral, unless and until the SVB Debt shall
have been fully paid and satisfied, except as authorized pursuant
to Section 7 of this Agreement. This subordination provision
shall apply with respect to all of the NEIPF Debt, regardless of
how or in what manner the NEIPF Debt is incurred, or whether the
NEIPF Debt has already been incurred or may be incurred in the
future by future advances or other financial accommodations made or
extended by NEIPF, or whether such future advances or other
financial accommodations are made at the discretion of NEIPF under
the NEIPF Documents or pursuant to commitment, collection efforts
or otherwise. If NEIPF or Investment Manager in violation of this
Agreement shall attempt any Collection Action (other than a
Collection Action with respect to the NEIPF Senior Collateral or as
permitted pursuant to Section 7 of this Agreement), then SVB
may interpose as a defense or plea the making of this Agreement and
SVB may intervene and interpose such defense in its name or in the
name of Borrowers, and SVB may by virtue of this Agreement restrain
the enforcement thereof in the name of Borrowers, or
SVB.
SECTION 6. Standby With
Respect to Designated Deposit Account . Notwithstanding
anything to the contrary contained herein, SVB shall not take any
Collection Actions with respect to the Designated Deposit Account
until the earliest to occur of (i) ninety (90) days
following receipt by Investment Manager and NEIPF of written notice
from SVB of SVB’s intention to take Collection Actions with
respect to the Designated Deposit Account following the occurrence
and during the continuance of an Event of Default under the SVB
Documents, (ii) receipt by SVB of written consent to the
taking of such Collection Actions with respect to the Designated
Deposit Account from Investment Manager and NEIPF, which consent
may be granted or denied in the sole discretion of Investment
Manager and NEIPF, as applicable, or (iii) the commencement of
an Insolvency Proceeding with respect to any Borrower. If SVB in
violation of this Agreement shall attempt any Collection Action
with respect to the Designated Deposit Account, then NEIPF and
Investment Manager may interpose as a defense or plea the making of
this Agreement and NEIPF and Investment Manager may intervene and
interpose such defense in its name or in the name of Borrowers, and
NEIPF and Investment Manager may by virtue of this Agreement
restrain the enforcement thereof in the name of Borrowers, or
NEIPF.
5.
SECTION 7. Permitted
Action by NEIPF and Investment Manager . Notwithstanding the
provisions of Section 5 hereof, NEIPF and Investment Manager
may take Collection Actions against Borrowers and realize upon the
NEIPF Security Interest in any of the SVB Senior Collateral upon
the occurrence of the following events: (a) Borrowers shall
have defaulted under the NEIPF Documents, (b) NEIPF and
Investment Manager shall have given Borrowers and SVB at least one
hundred eighty (180) days prior written notice of such
default, (c) Borrowers shall not have cured or caused to be
cured such default under the SVB Documents, and (d) SVB shall
not have commenced to take action to realize upon the SVB Security
Interest in the SVB Senior Collateral; provided, however ,
that NEIPF and Investment Manager may take Collection Actions
against Borrowers and realize upon the NEIPF Security Interest in
the NEIPF Senior Collateral upon the occurrence of an Event of
Default under the NEIPF Documents. Upon the request of SVB, NEIPF
and Investment Manager shall immediately cease any Collection
Actions then being pursued by NEIPF or Investment Manager with
respect to the SVB Senior Collateral if SVB at any time elects, in
its sole discretion, to demand payment of the SVB Debt and commence
any Collection Actions against Borrowers with respect to the SVB
Senior Collateral under the SVB Documents or as otherwise
authorized by applicable law. Nothing in this Section or elsewhere
in this Agreement shall be deemed to confer upon NEIPF and
Investment Manager any rights in or priority with respect to the
SVB Senior Collateral in connection with any judgment, garnishment,
attachment, execution, or other pre-judgment, garnishment,
attachment, execution or other pre-judgment or post-judgment remedy
obtained by NEIPF and Investment Manager against Borrowers or their
assets, that are equivalent or superior to SVB’s rights in
and priorities with respect to the SVB Senior Collateral under the
SVB Documents. Until the SVB Debt has been Indefeasibly Paid and
satisfied in full, any sums or assets obtained by NEIPF and
Investment Manager through the exercise of any such remedy shall be
paid over to SVB for application to the payment of the SVB Debt,
except for sums or assets received in respect to the Collateral
other than the SVB Senior Collateral.
SECTION 8. Permitted
Action by SVB . Notwithstanding the provisions of
Section 4 hereof, SVB may take Collection Actions against
Borrowers and realize upon the SVB Security Interest in any of the
NEIPF Senior Collateral upon the occurrence of the following
events: (a) Borrowers shall have defaulted under the SVB
Documents, (b) SVB shall have given Borrowers, NEIPF and
Investment Manager at least one hundred eighty (180) days
prior written notice of such default, (c) Borrowers shall not
have cured or caused to be cured such default under the NEIPF
Documents, and (d) neither NEIPF (nor Investment Manager)
shall have commenced to take action to realize upon NEIPF Security
Interest in the NEIPF Senior Collateral; provided, however ,
that SVB may take Collection Actions against Borrowers and realize
upon the SVB Security Interest in the SVB Senior Collateral upon
the occurrence of an Event of Default under the SVB Loan Agreement.
Upon the request of NEIPF or Investment Manager, SVB shall
immediately cease any Collection Actions then being pursued by SVB
with respect to the NEIPF Senior Collateral if NEIPF or Investment
Manager at any time elects, in their sole discretion, to demand
payment of the NEIPF Debt and commence any Collection Actions
against Borrowers under the NEIPF Documents or as otherwise
authorized by applicable law. Nothing in this Section 8 or
elsewhere in this Agreement shall be deemed to confer upon SVB any
rights in or priority with respect to the NEIPF Senior Collateral
in connection with any judgment, garnishment, attachment,
execution, or other pre-judgment, garnishment, attachment,
execution or other pre-judgment or post-judgment remedy
6.
obtained by SVB against Borrowers or
their assets, that are equivalent or superior to NEIPF’s
rights in and priorities with respect to such Collateral (other
than the SVB Senior Collateral) and proceeds thereof under the
NEIPF Documents. Until the NEIPF Debt has been Indefeasibly Paid
and satisfied in full, any sums or assets obtained by SVB through
the exercise of any such remedy shall be paid over to NEIPF for
application to the payment of the NEIPF Debt, except for sums or
assets received in respect to the SVB Senior Collateral.
SECTION 9. Non-Exclusive
License . In the event that NEIPF and/or Investment Manager
forecloses on, or otherwise takes possession of, any NEIPF Senior
Collateral, NEIPF and Investment Manager hereby grant to SVB a
non-exclusive, royalty-free license of such patents, trademarks,
copyrights and licenses (to the extent permitted by such licenses)
in order for SVB to promote and sell or otherwise dispose of the
SVB Senior Collateral, and to realize upon any SVB Senior
Collateral; provided; however, that notwithstanding the foregoing,
nothing herein shall diminish or infringe upon NEIPF’s and
Investment Manager’s first priority security interest in such
patents, trademarks, copyrights and licenses and NEIPF and
Investment Manager
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