Exhibit 10.1
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SUBORDINATION AGREEMENT
THIS
SUBORDINATION AGREEMENT (hereinafter referred to as this
"Agreement"), is made and entered into this 27th day of June, 2008,
by and
between Wachovia Corporation, a National Banking Association
organized and
existing under the laws of the United States of America with a
place of business
at 301 S. College Street, Charlotte, North Carolina, 28202
(hereinafter referred
to as the "Lender"), NACCO Materials Handling Group, Inc., a
Delaware
corporation, with a place of business at 1400 Sullivan Drive,
Caller No. 12011,
Greenville, North Carolina 27834-2011 (hereinafter referred to as
the
"Creditor"), and Transbotics Corporation, a North Carolina
corporation with a
principal place of business at 3400 Latrobe Drive, Charlotte, North
Carolina
28211-4848 ("Debtor") represent, covenant and agree as follows:
1.
RECITALS
1.1 Lender
and Creditor each have extended or anticipate extending credit
to
Debtor or otherwise have a security interest in certain property
owned or under
the custody and control of Debtor. Specifically, Creditor has made
progress
payments to Debtor for equipment being manufactured by Debtor to be
delivered to
Creditor.
1.2
Creditor, as a condition to its continuing business activities
with
Debtor, has requested that Lender vary the priority of Lender's
security
interest in certain property of Debtor, as described below, and
Lender has
agreed to vary the priority of its security interest, as set forth
below.
2.
AGREEMENT VARYING PRIORITY
2.1 As
between Lender and Creditor, the security interest of Creditor
shall
have first priority and be superior to any interest of Lender in
the property
described in Appendix 1 ("Deliverables") to this Agreement. As to
all other
property of Debtor, Creditor shall continue to have a first
priority security
interest. Upon the final sale of the Deliverables to Creditor,
Lender shall have
a first priority security interest in the proceeds of such
sale.
2.2
Creditor agress that it will make all payments to Debtor upon
the
presentation of a valid invoice under the payment terms of the
agreement between
Creditor and Debtor. Should Creditor at any time fail to make an
undisputed
payment to Debtor, such dispute which must be reasonable and
material, and fail
to cure the same within ten days of receipt of written notice of
such default,
then this Agreement shall terminate and Lender shall have a first
priority
security interest in the Deliverables.
2.3 This
Agreement shall continue until Debtor has delivered the
Deliverables
to Creditor or October 31, 2008, whichever first occurs. This
Agreement can be
extended by the mutual written agreement of the parties, such
consent not to be
unreasonably withheld, if for some reason delivery of the
Deliverables is
delayed beyond October 31, 2008.
2.4
Creditor and Debtor agree that 10% of any payment due to be paid
by
Creditor to Debtor shall be paid directly to Lender. Such payment
shall be made
at the same time as payment is made by Creditor to Debtor.The
payment to Lender
shall be made by wire using the following instructions, unless and
until Lender
provides different wiring instructions: Wachovia Bank ABA Number
053000219 Acct
Number: GL 01459160003288, special assets Mgmt- Charlotte, attn:
Fave Gordon -
704-383-6528 or Libby Church 336-651-5367.
3.
GENERAL
3.1 This
Agreement is solely for the benefit of Lender and Creditor, and
no
other persons or parties (including the Debtor) are intended to be
benefited in
any way by this Agreement.
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3.2
Nothing contained in this Agreement is intended to affect or limit
in any
way the security interest that each of the parties hereto has in
any or all of
the assets of Debtor, whether tangible or intangible, insofar as
the rights of
Debtor and third parties are involved.
3.3 The
foregoing relative priorities of the security interests of Lender
and
Creditor with respect to the Deliverables shall apply regardless of
the order or
time of perfection, whether they are protected by filing,
possession or
otherwise.
3.4 This
Agreement constitutes the entire agreement between Lender and
Creditor wit
