Common use of Ranking and Subordination Clause in Contracts

Ranking and Subordination. Except as set forth in this Section 3, the indebtedness evidenced by this Debenture shall rank equal in right of payment with all existing and future unsubordinated indebtedness of the Company. The indebtedness evidenced by this Debenture and the guaranty described in Section 14 and the other indebtedness, obligations and liabilities of the Company, Computex and its subsidiaries under the Purchase Agreement owing to Holder (collectively, the “Subordinated Indebtedness”) are subordinate and junior to the prior payment in full of all Senior Indebtedness (as defined below) to the extent and in the manner hereinafter set forth. The Holder agrees, from time to time as reasonably requested by the Company, to execute any documents reasonably required by the Company’s lenders reaffirming the subordination provisions contained in this Debenture; provided, however, that the existing rights of the Holder shall not be adversely affected thereby. For purposes of this Debenture and the guaranty described in Section 14, the term “Senior Indebtedness” shall mean all senior indebtedness, obligations and liabilities of the Company, Computex and Computex’s subsidiaries, whether outstanding on the date hereafter or thereafter created, incurred, assumed, guaranteed or in effect under the Senior Credit Facility, together with all other sums due thereon and all costs of collecting the same (including, without limit, reasonable attorney fees) for which such Person is or at any time may be liable. For the avoidance of doubt, Company shall have the right to pay (or cause to be paid) to Holder, and Holder shall have the right to receive and accept from Company, Computex and Computex’s subsidiaries, any and all regularly scheduled payments of the Subordinate Indebtedness (or any portion thereof) due to Holder pursuant to the terms and provisions of this Debenture, the guaranty described in Section 14, and/or the Purchase Agreement as and when such payments become due and payable; provided, that (x) no Senior Credit Default (I) has occurred and is continuing as of the date of the proposed payment to Holder, or (II) would otherwise result from such proposed payment being made to Holder and (y) no Insolvency Proceeding (as defined below) has occurred. In the event of any Insolvency Proceeding, the Senior Lender shall be entitled to receive payment in full of all Senior Indebtedness before Holder is entitled to receive any subsequent payment on account of any Subordinated Indebtedness; provided, however, that (x) in no event shall any such subordination impair the ability of the Company to issue or the rights of the Holder to receive additional Debentures in respect of accrued and unpaid interest in accordance with Section 2 hereof and (y) the foregoing shall not be deemed to require the repayment or reimbursement by Holder to Senior Lender of any amounts permitted to be received by Holder with respect to the Subordinated Indebtedness in compliance with this Section 3 prior to the occurrence of such Insolvency Proceeding. During the continuance of any Senior Credit Default, no cash payment shall be made with respect to the Subordinated Indebtedness (or any renewals or extensions thereof) if written or telegraphic notice of such event of default has been given to the Company by the Senior Lender. Should any payment, distribution or security or proceeds from these be received by Holder upon or with respect to the Subordinated Indebtedness that is not otherwise permitted under this Section 3 prior to the Senior Credit Termination, Holder shall immediately deliver same to the Senior Lender in the form received (except for endorsement or assignment by Holder where required by the Senior Lender), for application on the Senior Indebtedness (whether or not then due and in such order of maturity as the Senior Lender elects) and, until so delivered, the same shall be held in trust by Holder as the property of the Senior Lender. Until the Senior Credit Termination, upon the occurrence and during the continuance of any Senior Credit Default and/or any Insolvency Proceeding, Holder will not (without the prior consent of Senior Lender) ask for, demand, ▇▇▇ for, take or receive (by way of voluntary payment, acceleration, set-off or counterclaim, foreclosure or other realization on security, dividends in bankruptcy or otherwise), or offer to make any discharge or release of, any of the Subordinated Indebtedness, and Holder waives any such rights with respect to the Subordinated Indebtedness. Holder shall not exercise any rights of subrogation or other similar rights with respect to the Senior Indebtedness. This Section 3 constitutes a continuing agreement of subordination, as of any date prior to the Senior Credit Termination, even though the outstanding balance of the Senior Indebtedness may, from time to time, be zero. As of the date hereof, the Subordinated Indebtedness is unsecured. To the extent the Subordinated Indebtedness is ever secured by collateral also securing the Senior Indebtedness (referenced herein as “Shared Collateral”) and until the Senior Credit Termination, Holder agrees it will not (without the prior consent of Senior Lender) exercise any of Holder’s rights in any such Shared Collateral now or later securing the Subordinated Indebtedness. As of any date prior to the Senior Credit Termination, all rights of Holder in any Shared Collateral now or later securing the Subordinated Indebtedness are subordinated to all rights of the Senior Lender now or later existing in any of the same Shared Collateral. The relative priorities of the Senior Lender and Holder in the any Shared Collateral as set forth in this Section 3 control irrespective of the time, method or order of attachment or perfection of the liens and security interests acquired by the parties in the Shared Collateral and irrespective of the priorities as would otherwise be determined by reference to the Uniform Commercial Code or other applicable laws. As of any date prior to the Senior Credit Termination, Holder shall not contest the validity, priority or perfection of the security interest in or other lien upon the Shared Collateral (regardless of whether the Senior Lender’s security interest in or lien upon the Shared Collateral is valid or perfected). The priorities of any liens or security interests of the parties in any property of the Company, Computex or any of its subsidiaries other than the Shared Collateral are not affected by this Section 3 and shall be determined by reference to applicable law. The Senior Lender’s rights under this Section 3 are in addition to, and not in substitution of, its rights under any other subordination agreement with Holder.

Ranking and Subordination. Except as set forth in this Section 3, the indebtedness evidenced by this Debenture shall rank equal in right of payment with all existing and future unsubordinated senior indebtedness of the Company. The indebtedness evidenced by this Debenture and the guaranty described in Section 14 and the other indebtedness, obligations and liabilities of the Company, Computex and its subsidiaries under the Purchase Agreement owing to Holder (collectively, the “Subordinated Indebtedness”) are subordinate and junior to the prior payment in full of all Senior Indebtedness (as defined below) to the extent and in the manner hereinafter set forth. The Holder agrees, from time to time as reasonably requested by the Company, to execute any documents reasonably required by the Company’s lenders reaffirming the subordination provisions contained in this Debenture; provided, however, that the existing rights of the Holder shall not be adversely affected thereby. For purposes of this Debenture and the guaranty described in Section 14, the term “Senior Indebtedness” shall mean all senior indebtedness, obligations and liabilities of the Company, Computex and Computex’s subsidiaries, whether outstanding on the date hereafter or thereafter created, incurred, assumed, guaranteed or in effect effect, in each case, under the Senior Credit Facility, together with all other sums due thereon and all costs of collecting the same (including, without limit, reasonable attorney fees) for which such Person is or at any time may be liable. For the avoidance of doubt, Company shall have the right to pay (or cause to be paid) to Holder, and Holder shall have the right to receive and accept from Company, AVCTechnologies USA, Inc., American Virtual Cloud Technologies Ireland Limited, Computex and Computex’s subsidiaries, any and all regularly scheduled payments of the Subordinate Indebtedness (or any portion thereof) due to Holder pursuant to the terms and provisions of this DebentureDebenture (including, without limitation, Section 2(a) and 2(b) hereof), the guaranty described in Section 14, and/or the Purchase Agreement as and when such payments become due and payable; provided, that (x) no Senior Credit Default (I) has occurred and is continuing as of the date of the proposed payment to Holder, or (II) would otherwise result from such proposed payment being made to Holder and (y) no Insolvency Proceeding (as defined below) has occurred. In the event of any Insolvency Proceeding, the Senior Lender shall be entitled to receive payment in full of all Senior Indebtedness before Holder is entitled to receive any subsequent payment on account of any Subordinated Indebtedness; provided, however, that (x) in no event shall any such subordination impair the ability of the Company to issue or the rights of the Holder to receive additional Debentures in respect of accrued and unpaid interest in accordance with Section 2 hereof and (y) the foregoing shall not be deemed to require the repayment or reimbursement by Holder to Senior Lender of any amounts permitted to be received by Holder with respect to the Subordinated Indebtedness in compliance with this Section 3 prior to the occurrence of such Insolvency Proceeding. During the continuance of any Senior Credit Default, no cash payment shall be made with respect to the Subordinated Indebtedness (or any renewals or extensions thereof) if written or telegraphic notice of such event of default has been given to received by the Company by from the Senior LenderLender pursuant to Section 13 of the Senior Credit Agreement. Should any payment, distribution or security or proceeds from these be received by Holder upon or with respect to the Subordinated Indebtedness that is not otherwise permitted under this Section 3 prior to the Senior Credit Termination, Holder shall immediately deliver same to the Senior Lender in the form received (except for endorsement or assignment by Holder where required by the Senior Lender), for application on the Senior Indebtedness (whether or not then due and in such order of maturity as the Senior Lender elects) and, until so delivered, the same shall be held in trust by Holder as the property of the Senior Lender. Until the Senior Credit Termination, upon the occurrence and during the continuance of any Senior Credit Default (and written notice thereof to the Company by the Senior Lender as described in the immediately preceding paragraph) and/or any Insolvency Proceeding, Holder will not (without the prior consent of Senior Lender) ask for, demand, ▇▇▇ for, take or receive (by way of voluntary payment, acceleration, set-off or counterclaim, foreclosure or other realization on security, dividends in bankruptcy or otherwise), or offer to make any discharge or release of, any of the Subordinated Indebtedness, and Holder waives any such rights with respect to the Subordinated Indebtedness. Holder shall not exercise any rights of subrogation or other similar rights with respect to the Senior IndebtednessIndebtedness until the Senior Credit Termination. This Section 3 constitutes a continuing agreement of subordination, as of any date prior to the Senior Credit Termination, even though the outstanding balance of the Senior Indebtedness may, from time to time, be zero. As of the date hereof, the Subordinated Indebtedness is unsecured. To the extent the Subordinated Indebtedness is ever secured by collateral also securing the Senior Indebtedness (referenced herein as “Shared Collateral”) and until the Senior Credit Termination, Holder agrees it will not (without the prior consent of Senior Lender) exercise any of Holder’s rights in any such Shared Collateral now or later securing the Subordinated Indebtedness. As of any date prior to the Senior Credit Termination, all rights of Holder in any Shared Collateral now or later securing the Subordinated Indebtedness are subordinated to all rights of the Senior Lender now or later existing in any of the same Shared Collateral. The relative priorities of the Senior Lender and Holder in the any Shared Collateral as set forth in this Section 3 control irrespective of the time, method or order of attachment or perfection of the liens and security interests acquired by the parties in the Shared Collateral and irrespective of the priorities as would otherwise be determined by reference to the Uniform Commercial Code or other applicable laws. As of any date prior to the Senior Credit Termination, Holder shall not contest the validity, priority or perfection of the security interest in or other lien upon the Shared Collateral (regardless of whether the Senior Lender’s security interest in or lien upon the Shared Collateral is valid or perfected). The priorities of any liens or security interests of the parties in any property of the Company, Computex or any of its subsidiaries other than the Shared Collateral are not affected by this Section 3 and shall be determined by reference to applicable law. The Senior Lender’s rights under this Section 3 are in addition to, and not in substitution of, its rights under any other subordination agreement with Holder.

Ranking and Subordination. Except as set forth in this Section 3, the indebtedness evidenced by this Debenture shall rank equal in right of payment with all existing and future unsubordinated indebtedness of the Company. The indebtedness evidenced by this Debenture and the guaranty described in Section 14 and the other indebtedness, obligations and liabilities of the Company, Computex and its subsidiaries under the Purchase Agreement owing to Holder (collectively, the “Subordinated Indebtedness”) are subordinate and junior to the prior payment in full of all Senior Indebtedness (as defined below) to the extent and in the manner hereinafter set forth. The Holder agrees, from time to time as reasonably requested by the Company, to execute any documents reasonably required by the Company’s lenders reaffirming the subordination provisions contained in this Debenture; provided, however, that the existing rights of the Holder shall not be adversely affected thereby. For purposes of this Debenture and the guaranty described in Section 14, the term “Senior Indebtedness” shall mean all senior indebtedness, obligations and liabilities of the Company, Computex and Computex’s subsidiaries, whether outstanding on the date hereafter or thereafter created, incurred, assumed, guaranteed or in effect under the Senior Credit Facility, together with all other sums due thereon and all costs of collecting the same (including, without limit, reasonable attorney fees) for which such Person is or at any time may be liable. For the avoidance of doubt, Company shall have the right to pay (or cause to be paid) to Holder, and Holder shall have the right to receive and accept from Company, Computex and Computex’s subsidiaries, any and all regularly scheduled payments of the Subordinate Indebtedness (or any portion thereof) due to Holder pursuant to the terms and provisions of this Debenture, the guaranty described in Section 14, and/or the Purchase Agreement as and when such payments become due and payable; provided, that (x) no Senior Credit Default (I) has occurred and is continuing as of the date of the proposed payment to Holder, or (II) would otherwise result from such proposed payment being made to Holder and (y) no Insolvency Proceeding (as defined below) has occurred. In the event of any Insolvency Proceeding, the Senior Lender shall be entitled to receive payment in full of all Senior Indebtedness before Holder is entitled to receive any subsequent payment on account of any Subordinated Indebtedness; provided, however, that (x) in no event shall any such subordination impair the ability of the Company to issue or the rights of the Holder to receive additional Debentures in respect of accrued and unpaid interest in accordance with Section 2 hereof and (y) the foregoing shall not be deemed to require the repayment or reimbursement by Holder to Senior Lender of any amounts permitted to be received by Holder with respect to the Subordinated Indebtedness in compliance with this Section 3 prior to the occurrence of such Insolvency Proceeding. During the continuance of any Senior Credit Default, no cash payment shall be made with respect to the Subordinated Indebtedness (or any renewals or extensions thereof) if written or telegraphic notice of such event of default has been given to the Company by the Senior Lender. Should any payment, distribution or security or proceeds from these be received by Holder upon or with respect to the Subordinated Indebtedness that is not otherwise permitted under this Section 3 prior to the Senior Credit Termination, Holder shall immediately deliver same to the Senior Lender in the form received (except for endorsement or assignment by Holder where required by the Senior Lender), for application on the Senior Indebtedness (whether or not then due and in such order of maturity as the Senior Lender elects) and, until so delivered, the same shall be held in trust by Holder as the property of the Senior Lender. Until the Senior Credit Termination, upon the occurrence and during the continuance of any Senior Credit Default and/or any Insolvency Proceeding, Holder will not (without the prior consent of Senior Lender) ask for, demand, ▇s▇▇ for, take or receive (by way of voluntary payment, acceleration, set-off or counterclaim, foreclosure or other realization on security, dividends in bankruptcy or otherwise), or offer to make any discharge or release of, any of the Subordinated Indebtedness, and Holder waives any such rights with respect to the Subordinated Indebtedness. Holder shall not exercise any rights of subrogation or other similar rights with respect to the Senior Indebtedness. This Section 3 constitutes a continuing agreement of subordination, as of any date prior to the Senior Credit Termination, even though the outstanding balance of the Senior Indebtedness may, from time to time, be zero. As of the date hereof, the Subordinated Indebtedness is unsecured. To the extent the Subordinated Indebtedness is ever secured by collateral also securing the Senior Indebtedness (referenced herein as “Shared Collateral”) and until the Senior Credit Termination, Holder agrees it will not (without the prior consent of Senior Lender) exercise any of Holder’s rights in any such Shared Collateral now or later securing the Subordinated Indebtedness. As of any date prior to the Senior Credit Termination, all rights of Holder in any Shared Collateral now or later securing the Subordinated Indebtedness are subordinated to all rights of the Senior Lender now or later existing in any of the same Shared Collateral. The relative priorities of the Senior Lender and Holder in the any Shared Collateral as set forth in this Section 3 control irrespective of the time, method or order of attachment or perfection of the liens and security interests acquired by the parties in the Shared Collateral and irrespective of the priorities as would otherwise be determined by reference to the Uniform Commercial Code or other applicable laws. As of any date prior to the Senior Credit Termination, Holder shall not contest the validity, priority or perfection of the security interest in or other lien upon the Shared Collateral (regardless of whether the Senior Lender’s security interest in or lien upon the Shared Collateral is valid or perfected). The priorities of any liens or security interests of the parties in any property of the Company, Computex or any of its subsidiaries other than the Shared Collateral are not affected by this Section 3 and shall be determined by reference to applicable law. The Senior Lender’s rights under this Section 3 are in addition to, and not in substitution of, its rights under any other subordination agreement with Holder. To the extent the Subordinated Indebtedness is ever secured by any Shared Collateral as of any date prior to the Senior Credit Termination, the relative rights of the Senior Lender and the Holder in or to any distributions from or in respect of any such Shared Collateral or proceeds of such Shared Collateral, including without limitation, with respect to any rights acquired by Holder under Sections 363 and 364 of the Bankruptcy Code (as defined herein) shall continue after the filing of such petition on the same basis as prior to the date of such filing. If any Insolvency Proceeding shall occur, the Holder shall file appropriate claims or proofs of claim in respect of this Debenture at least 30 days prior to the expiration of the period during which such claims or proofs of claims may be filed without the approval of the court or any third party.