Exhibit 10.5
THE LOAN EVIDENCED HEREBY IS SUBORDINATED TO FULL PAYMENT OF THE INDEBTEDNESS
DUE SENIOR LENDER (DEFINED BELOW) PURSUANT TO THAT DEBT AND LIEN SUBORDINATION
AGREEMENT BY AND BETWEEN LENDER AND SENIOR LENDER
This Business Loan and Security Agreement (“Agreement”), dated as of July 31,
2017, is entered into by the Borrower named below and Super G Capital, LLC, a
Delaware limited liability company (“Lender”).
The following chart (“Loan Chart”) sets forth the loan and repayment terms of
the Borrower’s obligation:
BORROWER
NAME OF BORROWER
GLOWPOINT, INC., a Delaware corporation, and its Affiliates listed on Schedule 1
attached hereto
ADDRESS
1766 Lincoln Street, 13th Floor, Denver, CO 80203
NAME OF PRINCIPAL
N/A

LOAN DETAILS
AMOUNT OF LOAN
$1,100,000
ORIGINATION AND/OR OTHER FEES
$11,000
PAYMENT TO EXISTING SECURED LENDER*
[SEE SECTION 1.2 BELOW]
REMAINING DISBURSEMENT AMOUNT
$1,089,000
TOTAL INTEREST CHARGE**
$440,000
TOTAL PAYBACK
$1,540,000

PAYMENT SCHEDULE
START DATE FOR PAYMENTS
August 16, 2017
PAYMENT FREQUENCY***
Semimonthly
NUMBER OF PAYMENTS
Forty-eight (48)
PAYMENT AMOUNT
For the first six (6) payments, $16,500.00; and
For the remaining forty-two (42) payments, $34,309.53.

COLLATERAL
ALL PERSONAL PROPERTY ASSETS
 
PERMITTED ENCUMBRANCES
SEE ADDENDUM 1
CAP ON PURCHASE MONEY DEBT
$100,000

SEE CONDITIONS TO FUNDING ON ADDENDUM 2
SEE ADDITIONAL COVENANTS ON ADDENDUM 3
SEE LOAN CLOSING CHECKLIST ON ADDENDUM 4
*
Existing Secured Lender is Main Street Capital

**
Does not include any loan Origination and/or Other Processing Fees.

 
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***
Payments to be made two (2) times each calendar month (“Semimonthly Payments”)
for the “Number of Payments” commencing on the “Start Date For Payments” set
forth above. Thereafter, Semimonthly Payments shall be made on the first
Business Day following the fifteenth (15th) day of each calendar month and on
the first Business Day following the first (1st) day of each calendar month.

 
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RECITALS
WHEREAS, Borrower desires to obtain a loan of money (the “Loan”) from Lender in
the amount set forth in the above Loan Chart and Lender is willing to make the
Loan, but only on the terms and conditions set forth in this Agreement.
NOW, THEREFORE, in consideration of the promises and the mutual promises herein
contained and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, Lender shall make the Loan on the following
terms and conditions:
1.    LOAN
1.1    Loan. Lender shall make the Loan to Borrower of the sum designated in the
Loan Chart as “Amount of Loan,” subject to the terms and conditions of this
Agreement.
1.2    Funding. Lender shall not be obligated to fund the Loan until after all
conditions set forth in Addendum 2 have been satisfied or waived in writing by
Lender. As soon as all funding conditions have been satisfied or waived in
writing by Lender, Lender shall fund the Loan by paying to Senior Lender,
pursuant to a payment procedure agreed upon by Lender and Senior Lender, the
amount specified in the as the Discounted Payoff Amount set forth in the Payoff
letter from Existing Secured Lender described in Addendum 2; provided that if
any portion of the proceeds of the Loan is not used by Senior Lender to pay the
Existing Secured Lender, Lender has instructed Senior Lender to make an ACH
transfer to Borrower’s account designated on the ACH authorization form
(“Borrower’s Account”) of such remaining proceeds. Lender shall retain, from the
remaining balance of the proceeds of the Loan, an amount equal to the
“Origination and/Other Fees” shown on the Loan Chart.
2.    PAYMENT TERMS
2.1    Repayment. Borrower shall repay the Loan by paying the Total Payback
Amount specified and on the terms set forth in the Loan Chart, subject to the
additional terms set forth in this Agreement.
2.2    [RESERVED].
2.3    [RESERVED].
2.4    Prepayment Limitation. Borrower shall be entitled to prepay all (but not
less than all) of the Total Payback for the Loan without discount, either before
or after an Event of Default, and any interest that may be owing and included in
the Total Payback for the Loan shall be all due and payable and not subject to
any credit or deduction of the total amount due as a result of payment being
made prior to the due date for the last payment.
2.5    Interest. Interest for the Loan is already included in the amount
specified in the Loan Chart as Total Payback. Following the occurrence and
during the continuance of an Event of Default, an additional interest charge of
five percent (5%) per annum on the then outstanding Obligations shall be
immediately due and owing from the date of the Event of Default until the date
Borrower cures such Event of Default.
2.6    Late Fee. If any Payment Amount set forth in the Loan Chart is not
received in full by Lender as of the applicable due date, and such failure is
not cured within three (3) Business Days of the date due, Borrower authorizes
Lender, without notice to Borrower, to charge a late charge equal to five
percent (5%) of such Payment Amount then due, or the maximum amount permitted by
applicable law, whichever is less (the “Late Fee”), by initiating debit charges
to Borrower’s Account. The Late Fee shall apply only to scheduled payments and
shall not apply to any lump sum payment due upon acceleration.
2.7    Borrower’s Obligation to Pay Is Not Conditional on Amount of Funds in
Borrower’s Account. Borrower’s obligation to repay the Obligations is not
dependent upon whether or not there are sufficient funds in the Borrower’s
Account, nor is Borrower’s obligation to pay excused if Borrower receives
insufficient income to make any payment required under this Agreement. If, for
any reason, there are insufficient funds

 
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in Borrower’s Account or insufficient income to cover any payment due under this
Agreement, or if for any reason Lender is unable to collect on an ACH request to
Borrower’s Account, Borrower agrees to immediately make said payment by regular
check, cashier’s check, money order or by wire transfer as instructed by Lender.
Borrower understands that payments made by any method other than that
contemplated by the ACH Authorization may result in a delay in Lender’s receipt
of such payment and that Borrower may incur a Late Fee if the payment is
received late.
3.    SECURITY INTEREST IN COLLATERAL
3.1    Collateral And Loan Security. As security for the payment of the Loan,
and all other liabilities and obligations of the Borrower to Lender, now
existing or hereafter created, whether under the Loan Documents or otherwise
(collectively, the “Obligations”) (as further defined below), Borrower hereby
unconditionally grants, assigns, and pledges to Lender a continuing security
interest (the “Security Interest”) in all personal property, tangible or
intangible, of Borrower whether now owned or hereafter acquired or arising and
wherever located, including Borrower’s right, title, and interest in and to the
following, whether now owned or hereafter acquired or arising and wherever
located: all accounts, all chattel paper, all commercial tort claims, all
deposit accounts (including, without limitation, the Borrower’s Account), all
documents, all general intangibles (including, without limitation, all payment
intangibles, patents, patent applications, trademarks, trademark applications,
trade names, copyrights, copyright applications, software, engineering drawings,
service marks, customer lists, goodwill, and all licenses, permits, agreements
of any kind or nature pursuant to which Borrower possesses, uses or has
authority to possess or use property of others or others possess, use or have
authority to possess or use property); all goods (including all equipment,
fixtures and inventory), all investment property, securities and all other
investment property; supporting obligations; any other contract rights or rights
to the payment of money; insurance claims and proceeds; commercial tort claims;
all money, all negotiable collateral, all instruments, all books and records,
and all supporting obligations and proceeds arising from or relating to any of
the foregoing (the “Collateral”).
3.2    [RESERVED].
3.3    Additional Documents. Borrower shall execute from time to time, upon the
request of Lender, such financing statements or other documents as are
reasonably required by Lender to perfect or continue the Security Interest
described herein.
3.4    Lender Appointed Attorney-In-Fact. Borrower hereby irrevocably appoints
Lender as Borrower’s attorney-in-fact, with full authority in the place and
stead of Borrower and in the name of Borrower following the occurrence of an
Event of Default which is continuing, so as to permit Lender to take any action
and to execute any instrument that Lender may deem necessary or advisable to
accomplish the purposes of this Agreement, including but not limited to
continuing perfection of Lender’s security interest.
3.5    Consent. Borrower consents to the Lender taking any and all steps that
Lender deems reasonably necessary to ensure that Lender has obtained a valid and
perfected security interest in the Collateral. Accordingly, Borrower consents to
having Lender file any liens, financing statements, or any other documentation,
as required by the California Commercial Code or any other laws, rules, or
regulations in order to establish Lender’s Security Interest in the Collateral
and/or perfect Lender’s Security Interest.
4.    REPRESENTATIONS AND WARRANTIES
In order to induce Lender to enter into this Agreement and to make the Loan,
Borrower makes the following representations and warranties to Lender, each of
which shall be deemed made as of the effective date of this Agreement and shall
be continuing until all Obligations arising or related to this Agreement have
been paid and performed in full. Any knowledge acquired by Lender shall not
diminish its rights to rely upon such representations and warranties:
4.1    Legal Status. Borrower, if a corporation, limited liability company,
partnership, trust, or other legal entity, has been duly organized and is
validly existing under the laws of its jurisdiction of organization and is
qualified to transact business, and has made all filings and is in good
standing, in every jurisdiction in which the nature of its business or assets
requires such qualification. Borrower has all requisite power and

 
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authority to own its properties and conduct its business as presently conducted
and as proposed to be conducted and to execute and deliver, and to perform its
Obligations under, this Agreement.
4.2    No Violation. The making and performance by Borrower of the Loan
Documents do not violate any provision of law or any provision of Borrower’s
formation documents, including, without limitation, articles of incorporation or
organization or any operating, partnership or trust agreement, or result in a
breach of, or constitute a default under, any agreement, indenture, or other
instrument to which Borrower is a party or by which Borrower may be bound.
4.3    Loan For Specific Purposes Only. The proceeds of the Loan must be used
only for the specific business purposes described in the application for the
Loan submitted by Borrower to Lender. Borrower understands and agrees NOT to use
the Loan proceeds for personal, family, or household purposes. Borrower further
understands that there are certain important duties imposed upon entities making
loans to consumers for personal, family, or household purposes, and certain
important rights conferred upon consumers, pursuant to federal or state law and
that all of those laws, rules, and regulations concerning consumer loans do NOT
apply to the Loan or this Agreement. Borrower hereby confirms that he/she/it has
consulted with his/ her/its own attorney, or has had a fair opportunity to
consult with an attorney, concerning this matter and that Borrower’s counsel has
explained to Borrower and/or Borrower understands that these rules, regulations,
and laws concerning consumer loans do not apply to the Loan or this Agreement.
Borrower also understands that Lender will be unable to confirm whether
Borrower’s actual use of the proceeds of the Loan conforms to the requirements
of this Section. Borrower agrees that a breach by Borrower of the provisions of
this Section will not affect Lender’s right to: (i) enforce Borrower’s promise
to pay all amounts owed under this Agreement, regardless of Borrower’s actual
use of the proceeds of the Loan; or (ii) to use any remedy legally available to
Lender, even if that remedy would not have been available had the Loan been made
for consumer or personal purposes.
4.4    Authorization. This Agreement has been duly authorized, executed, and
delivered by Borrower, and is a legal, valid and binding agreement of Borrower
enforceable against Borrower in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency, reorganization,
moratorium or similar laws effecting creditors’ rights generally and by general
principles of equity.
4.5    Financial Statements. All financial statements and reports that may have
been required and have been presented to Lender in conjunction with the Loan,
have been prepared in conformity with generally accepted accounting principles
consistently applied (“GAAP”), and fairly and accurately present the financial
condition and income of Borrower, as of the date given, and none of the
foregoing contains any untrue statement of a material fact nor fails to state a
material fact required in order to make such financial statements not
misleading. Since the date of the last such financial statement, there has been
no adverse material change in the financial condition or operations of Borrower.
4.6    Consent and Licenses. No consent, approval or authorization of, or
registration or filing with any governmental body or authority, or any other
person, firm or entity not a party hereto, is or will be required as a condition
to the valid execution, delivery, performance, or enforceability of the Loan
Documents, or the transactions contemplated hereby or thereby, or to the conduct
of Borrower’s business, other than any filings required to perfect Lender’s
Security Interest.
4.7    Litigation. There is no litigation either pending or, to the best of
Borrower’s knowledge, threatened against Borrower before any court or
administrative agency, or before any arbitrator, which is reasonably likely to
have a Material Adverse Effect. Furthermore, Borrower is not in violation of any
law and is not the subject of any investigation by a governmental agency that
could result in an indictment, criminal filing, or a forfeiture or seizure of
any of its/his/her assets;
4.8    Unencumbered Collateral. Borrower has good and marketable title to all of
the Collateral and will have good and marketable title to all properties and
assets acquired by Borrower hereafter, except for such assets as have been
disposed of in accordance with Section 6.3 hereof. Except for the security
interest granted hereunder and the Permitted Encumbrances described in Addendum
1 attached hereto, Borrower shall be the sole and exclusive owner of the
Collateral which is and shall remain free from any and all liens,

 
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security interests, encumbrances, claims and interests and, except any security
agreement, financing statement, equivalent security or lien instrument entered
into or filed in connection with the Permitted Encumbrances described in
Addendum 1 attached hereto, no security agreement, financing statement,
equivalent security or lien instrument or continuation statement covering any of
the Collateral is on file or of record in any public office.
4.9    [RESERVED].
4.10    Tax Returns. Borrower has filed all tax returns that were required to be
filed by it and has paid all taxes and assessments which are payable by it, to
the extent that the same have become due and payable and before they became
delinquent. Borrower does not know of any proposed material tax assessment
against it or any of its/his/her properties for which adequate provision has not
been made on its/his/her books.
4.11    Past Legal Proceedings. Borrower has not been: (a) the subject of any
criminal conviction (excluding traffic misdemeanors); (b) a debtor or alleged
debtor in any bankruptcy proceeding, insolvency proceeding or receivership
proceeding; (c) subject to liens imposed by any governmental authority, other
than Permitted Encumbrances; or (d) any restraining order, decree, injunction,
or judgment in any proceeding or lawsuit, except in each case for such matters
as have been fully disclosed to Lender in writing and expressly consented to by
Lender in writing.
4.12    Full Disclosure. Neither this Agreement, nor any other Loan Document,
nor any other statements certificates or information made or delivered herewith
or therewith contains any untrue statement of material fact or omits or will
omit to state a material fact necessary to make the statements herein or therein
not misleading. To Borrower’s knowledge, since December 31, 2016, there are no
facts which (individually or in the aggregate) could reasonably be expected to
have a Material Adverse Effect that have not been set forth in this Agreement or
in the other Transaction Documents or any exhibit or schedule or other document
delivered in connection herewith or therewith.
4.13    Related-Party Transactions. Except as set forth in Section 6.2, no
manager, employee, officer, or director of Borrower is indebted to Borrower
except advances made in the ordinary course of business, nor is Borrower
indebted (or committed to make loans or extend or guarantee credit) to any of
them. Other than any contract between the Borrower and its subsidiaries, no
member of the immediate family or Affiliate of any manager, officer or director
of Borrower is directly or indirectly interested in any material contract with
Borrower.
5.    AFFIRMATIVE COVENANTS
Until all Obligations are paid and performed in full, Borrower shall comply with
the following covenants:
5.1    Books And Records. Borrower shall at all times keep accurate and complete
books, records, and accounts of all of Borrower’s business activities, prepared
in accordance with GAAP. Borrower shall permit the Lender, or any persons
designated by the Lender, at any reasonable time and from time to time, and
without hindrance or delay, to: (a) visit and inspect Borrower’s properties and
place(s) of business; (b) inspect, audit and examine Borrower’s books, records,
correspondence, and accounts and to make copies or extracts thereof (and Lender
may remove any of such records temporarily for the purpose of having such copies
made); and (c) discuss with Borrower’s principal officers and independent
accountants, Borrower’s business, assets, liabilities, financial condition,
results of operations, and business prospects. At Lender’s request, Borrower
shall deliver to Lender: (i) schedules of accounts and general intangibles; and
(ii) such other information regarding the Collateral as Lender shall request.
5.2    Notices. Borrower shall promptly notify Lender in writing of the
occurrence of: (i) any Event of Default or any act or event which, with the
giving of notice or the passage of time, or both, would be such an Event of
Default; (ii) any legal action, proceeding or investigation threatened or
instituted against Borrower that is reasonably likely to result in a judgment
against Borrower in an amount that exceeds $50,000 or (iii) Borrower’s present
or future inability to pay or perform the Obligations under this Agreement. If
Lender has been notified pursuant to this Section, or has knowledge of same from
other sources, then at Lender’s request, Borrower

 
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shall furnish to Lender a summary of the status of all such actions, proceedings
or investigation and provide Lender with such additional information concerning
the same as Lender may from time to time request.
5.3    Maintain Business. Borrower shall: (i) maintain in full force and effect
in all material respects all licenses, permits, insurance, authorizations,
bonds, franchises, and other rights necessary or desirable to the profitable
conduct of Borrower’s business; (ii) continue in, and limit Borrower’s
operations to, the same general lines of business as are presently conducted;
(iii) comply with all applicable laws, orders, regulations, and ordinances of
all governmental authorities, except to the extent that the failure to do so
might have a Material Adverse Effect; (iv) if a corporation, partnership or
limited liability company, shall maintain Borrower’s corporate, partnership or
limited liability company existence; and (v) take such actions as are necessary
to maintain Borrower’s legal existence and good standing in each jurisdiction
where the failure to do so might have a Material Adverse Effect.
5.4    Maintain Business Property And Lender’s Collateral. Borrower shall
protect and preserve all assets necessary and material to Borrower’s business,
including intellectual property, maintain in good working order and condition
(subject to ordinary wear and tear) all buildings, equipment and other tangible
real and personal property, and from time to time make or cause to be made all
renewals, replacements, and additions to such property necessary for the conduct
of Borrower’s business. Borrower shall defend the right, title, and interest of
Lender in and to the Collateral against all claims and demands of all persons
and entities at any time claiming the same or any interest therein. At any time
Borrower acquires any assets, tangible or intangible, real or personal, having a
fair market value in excess of $25,000, in which a security interest, deed of
trust or mortgage is not already granted to or properly perfected by Lender on
behalf of Lender, Borrower shall immediately provide notice thereof to Lender
and cause to be executed such documents as may be reasonably requested by Lender
in order to perfect Lender’s security interest in such Collateral.
5.5    [RESERVED].
5.6    [RESERVED].
5.7    [RESERVED].
5.8    Insurance. Borrower shall keep all of Borrower’s properties, real and
personal (including the Collateral), adequately insured at all times with
responsible insurance carriers, reasonably acceptable to Lender, against loss or
damage by fire and other hazards (so called “All Risk Coverage”). Borrower shall
at all times maintain adequate insurance with coverage amounts and with
responsible insurance carriers, each acceptable to Lender, against liability on
account of damage or claims of damage to persons and properties and under all
applicable workers’ compensation laws, and covering such other risks as Lender
may reasonably from time to time require. Borrower shall instruct the applicable
insurance carrier to have all such insurance policies provide at least thirty
(30) days’ notice to Lender prior to cancelation or termination. Lender shall be
named as loss payee, additional insured or otherwise, as Lender's interest may
appear, as the case may be, under all such policies. Borrower represents that
all such insurance coverage is presently in full force and effect and subject to
no lapses and defaults. Borrower agrees to deliver copies of all of the
foregoing insurance policies to Lender. In the event of any loss or damage to
the Collateral, Borrower shall give immediate written notice to Lender and to
its insurers of such loss and damage and will promptly file proof of loss with
its insurers.
5.9    Payment of Taxes and Other Obligations; Tax Returns. Borrower shall
timely file all required tax returns and pay and discharge all taxes,
assessments, and governmental charges or levies imposed upon it or on income or
profits or upon property belonging to it prior to the date on which penalties
attach thereto and pay and perform all lawful claims, obligations, and debts
which, if unpaid, might become a lien or charge upon any asset or property of
Borrower, or where the failure to pay or perform might have a Material Adverse
Effect, provided that Borrower shall not be required to pay or perform any such
tax, assessment, charge, levy, claim, obligation, or debt for which Borrower has
obtained a bond or insurance, or for which it has established a reserve in
accordance with GAAP and the payment or performance of which is being contested
in good faith and by appropriate proceedings which are being reasonably and
diligently pursued.

 
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5.10    Comply with Laws. Borrower shall perform and promptly comply, and cause
all property of Borrower to be maintained, used and operated in accordance, in
each case in all material respects, with all: (i) present and future laws,
ordinances, rules, regulations, orders, and requirements (including, without
limitation, zoning ordinances, building codes, and environmental laws, and the
regulations adopted pursuant thereto, and any other similar applicable federal,
state, or local laws, rules, regulations, or ordinances) of every duly
constituted governmental or quasi-governmental authority or agency applicable to
Borrower or any of Borrower’s properties; (ii) similarly applicable orders,
rules, and regulations of any regulatory, licensing, accrediting, insurance
underwriting or rating organization, or other body exercising similar functions,
to the extent usually complied with by companies engaged in similar businesses
and owning similar properties in the same general areas in which Borrower
operates; and (iii) similarly applicable duties or obligations of any kind
imposed under any certificate of occupancy or otherwise by law, covenant,
conditions, agreement or easement, public or private.
5.11    Further Assurances. Borrower shall make, execute, and deliver all such
additional and further acts, things, deeds, and instruments as Lender may
reasonably require to document and consummate the transactions contemplated
hereby and to vest completely in and ensure Lender its rights under this
Agreement.
5.12    Financial Reporting Requirements. Borrower shall deliver to Lender the
following, all in form and substance reasonably satisfactory to Lender:
(a)    within thirty (30) days after the end of each calendar month (including
the last period in each fiscal year), monthly financial statements of Borrower
(including, without limitation, a balance sheet and income statement), certified
and dated by an authorized financial officer. The statements shall be prepared
on a consolidated basis;
(b)     within five 5 Business Days after the 15th and last day of each calendar
month, a detailed aging of Borrower’s accounts receivable by invoice or a
summary aging by account debtor, together with payable aging, inventory analysis
(if applicable), deferred revenue report (if applicable), and such other matters
as Lender may request;
(c)    all annual and quarterly financial statements of Borrower. Quarterly
financial statements shall be delivered to Lender no later than forty-five (45)
days after the end of each fiscal quarter of Borrower; and annual financial
statements shall be delivered to Lender no later than one-hundred eighty (180)
days after the fiscal year-end of Borrower;
(d)    all documents and information required to be delivered, and at the same
as delivered, Senior Lender pursuant to Sections 4.14(c), (d), (e) and (f) of
the Senior Loan Agreement; and
(e)    such other information as Lender may, from time to time, reasonably
request.
5.13    Disclosure of Employee Benefits. Borrower shall:
(a)    Promptly, and no later than ten (10) Business Days after Borrower or any
of its/his/her subsidiaries know or have reason to know that an event has
occurred relating to the Borrower’s plan requirements under the Employee
Retirement Income Security Act of 1974 (“ERISA”) that reasonably could be
expected to result in a Material Adverse Effect, a written statement of the
chief financial officer of such Borrower or subsidiary shall be delivered to
Lender describing such ERISA event and any action that is being taking with
respect thereto by Borrower or any of its/his/her subsidiaries or Affiliates,
and any action taken or threatened by the Internal Revenue Service (“IRS”), the
Department of Labor, of the Pension Benefit Guaranty Corporation (“PBGC”).
Borrower and its/his/her subsidiaries shall: (i) be deemed to know all facts
known by the administrator of any benefit plan of which it is the plan sponsor;
(ii) promptly, and no later than three (3) Business Days after the filing
thereof with the IRS, deliver to Lender a copy of each funding waiver request
filed with respect to any benefit plan and all communications received by
Borrower or any of its/his/her subsidiaries or Affiliates; and (iii) promptly,
and no later than five (5) Business Days after receipt by Borrower or any of
its/his/her subsidiaries of any information that the PBGC has an intention to
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any benefit plan or to have a trustee appointed to administer a benefit plan,
deliver copies of each such notice to Lender.
(b)    Cause to be delivered to Lender, upon Lender’s reasonable request, each
of the following: (i) a copy of each benefit plan and retiree health plan (or,
where any such plan is not in writing, a complete description thereof) (and if
applicable, related trust agreements or other funding instruments) and all
amendments thereto, all material written interpretations thereof and material
written descriptions thereof that have been distributed to employees or former
employees of Borrower or any of its/his/her subsidiaries; (ii) the most recent
determination letter issued by the IRS with respect to each benefit plan; (iii)
for the three most recent plan years, annual reports on Form 5500 Series
required to be filed with any governmental agency for each benefit plan; (iv)
all actuarial reports prepared for the last three plan years for each benefit
plan; (v) a listing of all multiemployer plans, with the aggregate amount of the
most recent annual contributions required to be made by Borrower or any of
its/his/her subsidiaries or any of their ERISA affiliates to each such plan and
copies of the collective bargaining agreements requiring such contributions;
(vi) any information that has been provided to Borrower or any of its/his/her
subsidiaries or any of their ERISA affiliates regarding withdrawal liability
under any multiemployer plan; and (vii) the aggregate amount of the most recent
annual payments made to former employees of Borrower or any of its/his/her
subsidiaries under any retiree health plan.
(c)    Cause to be delivered to Lender, upon Borrower’s and Lender’s mutual
agreement that Lender’s request is reasonable, a copy of each plan not referred
to in Section 5.13(b) (or, where any such plan is not in writing, a complete
description thereof) (and if applicable, related trust agreements or other
funding instruments) and all amendments thereto, all material written
interpretations thereof and material written descriptions thereof that have been
distributed to employees or former employees of Borrower or any of its/his/her
subsidiaries.
6.    NEGATIVE COVENANTS
Until all Obligations have been paid and performed in full, Borrower covenants
and agrees that it will NOT, without Lender’s written consent, which may be
denied in its sole discretion:
6.1    Additional Encumbrances. Create or suffer to arise any (i) lien, security
interest, other charge or encumbrance upon or with respect to any of the
Collateral except for the Security Interest and any Permitted Encumbrances, or
(ii) grant or agreement to any negative pledge that would prohibit securing the
Obligations created by this Agreement and any replacement or refinancing thereof
with any properties or assets of Borrower. Borrower shall notify Lender promptly
in the event that any lien or charge on any Collateral shall be created,
asserted, filed, or come into existence in violation of this Section 6.1;
6.2    Other Advances. Receive any loans, incur any indebtedness for borrowed
money or receive any advances without Lender’s written approval except for the
following: (a) indebtedness (other than the Obligations, but including
capitalized lease obligations), incurred at the time of, or within twenty (20)
days after, the acquisition of any fixed assets for the purpose of financing all
or any part of the acquisition cost thereof, including any refinancing of such
Purchase Money Debt (“Purchase Money Debt”), all in the aggregate amount at any
time not to exceed the “Cap on Purchase Money Debt” specified in the Loan Chart;
(b) indebtedness due to Western Alliance Bank (“Senior Lender”), pursuant to the
Business Financing Agreement dated as of July 31, 2017 (the "Senior Loan
Agreement") between Senior Lender and Borrower and all other documents
evidencing, securing or relating to the indebtedness of Borrower to Senior
Lender or executed in connection therewith, and all amendments and modifications
of any of the foregoing (all such documents, including the Senior Loan
Agreement, collectively, the “Senior Loan Documents”); (c) other indebtedness in
an aggregate amount not to exceed $25,000 at any time outstanding; provided that
such indebtedness is junior in priority (if secured) to the Obligations and
provided that the incurrence of such Indebtedness does not otherwise cause an
Event of Default hereunder; (d) indebtedness incurred in the refinancing of any
indebtedness set forth in (a) through (c) above, provided that the principal
amount thereof is not increased or the terms thereof are not modified to impose
more burdensome terms upon Borrower and (e) Subordinated Debt held by the
parties listed on Schedule 2 attached hereto (the "Subordinated Debt Holders").

 
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6.3    Disposition of Assets. Sell, lease, assign, transfer, or otherwise
dispose of (collectively, a “Transfer”), all or any part of its business or
property, other than: (a) Transfers of inventory in the ordinary course of
business; (b) Transfers of non-exclusive licenses and similar arrangements for
the use of the property of Borrower in the ordinary course of business; (c)
Transfers of worn-out or obsolete equipment which was not financed by Lender;
(d) the sale or discount, in each case without recourse, of accounts receivable
arising in the ordinary course of business, but only in connection with the
compromise or collection thereof in accordance with the terms of this Agreement;
(e) the sale or issuance of equity interests, options or warrants to purchase
equity interests of Administrative Borrower (as defined below); and (f) (i) the
lapse of registered patents, trademarks, copyrights and other intellectual
property of Borrower to the extent not economically desirable in the conduct of
its business or (ii) the abandonment of patents, trademarks, copyrights, or
other intellectual property rights of Borrower in the ordinary course of
business so long as, in each case, such intellectual property or intellectual
property rights are not material to the Borrower’s business;
6.4    No Guaranties or Contingent Obligations. Guaranty, assume, or otherwise
become directly or contingently liable for the debt of any other person or
organization;
6.5    Limitations on Extensions of Credit. Make any loan or advance or extend
any credit other than extension of trade credit in the ordinary course of
business;
6.6    No Changes in Business or Name. (a) Make or permit to be made any
material change in the character of Borrower’s business, other than to grow the
business; (b) change Borrower’s name from that indicated in the public record of
Borrower’s jurisdiction of organization without providing at least thirty (30)
days’ prior written notice to Lender; (c) change the location of Borrower’s
headquarters, executive offices or places of operations without providing at
least thirty (30) days’ prior written notice to Lender; or (d) change Borrower’s
structure without the written consent of Lender;
6.7    No Amendments/Modifications to Constituent Documents. Permit the
amendment, modification, restatement, or other changes to the organizational
documents of Borrower including, if applicable, the articles of incorporation or
organization, by-laws, or operating partnership agreement, unless Borrower sends
Lender the proposed changes to organizational documents no less than five (5)
days prior to the effective date thereto (unless waived by Lender);
6.8    No Prepayments of Debt. Prepay any indebtedness for borrowed money to any
person or entity other than Lender or Senior Lender;
6.9    Restricted Payments. (a) Declare or pay or make any form of dividend or
distribution other than dividends or distributions to equity holders to meet
their tax obligations on income realized by such holders attributable solely to
such holders’ investment in Borrower in a timely manner; (b) make any payments
of any indebtedness subordinated to the Obligations due Lender or otherwise
redeem, repurchase or retire any instrument evidencing such amount, or reduce or
terminate any commitment in respect of such indebtedness, in each case except
pursuant to the provisions of a subordination agreement acceptable to Lender; or
(c) redeem, repurchase, or retire any capital stock or other equity, other than
the following ("Tax Redemptions"): redemptions or repurchases of capital stock
from equity holders to meet their tax obligations on income realized by such
holders attributable solely to such holders’ investment in Borrower in a timely
manner; so long as (x) the aggregate amount of Tax Redemptions in any calendar
year shall not exceed $75,000; and (y) prior to and after giving effect to any
Tax Redemption, no Event of Default has occurred and is continuing;
6.10    [RESERVED];
6.11    [RESERVED];
6.12    Transactions with Affiliates. (a) Make any loan, advance, extension of
credit or non-compensation related payment to any Affiliate of Borrower; or (b)
enter into any other transaction, including, without limitation, the purchase,
sale, lease, or exchange of property, or the rendering or any service, to or
with any Affiliate of Borrower, the terms of which are less favorable to such
person than the terms such person would have

 
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been able to obtain in a similar transaction between such person and an
unrelated third party obtained through arms’ length dealings; provided, however,
that Borrower may in any event pay reasonable compensation to any such employee
or officer in the ordinary course of Borrower’s business consistent and
commensurate with industry custom and practice for the services provided by such
person and may enter into any transaction with (i) Subsidiaries of the Borrower
and (ii) any other Affiliates so long as all such transactions, either singly or
in the aggregate, have a value of no more than $10,000;
6.13    [RESERVED];
6.14    Limitations on Investments. Purchase, own, invest in, or otherwise
acquire, directly or indirectly, any equity securities, any interests in any
partnership or joint venture (including the creation or capitalization of any
subsidiary), evidence of indebtedness or other obligation or security,
substantially all or a portion of the business or assets of any other person or
entity, or any other investment or interest whatsoever in any other person or
entity, or make or permit to exist, directly or indirectly, any loans, advances
or extensions of credit to, or any investment in cash or by delivery of property
in, any person or entity other than: (i) investments previously described in
writing to Lender; (ii) the extension of trade credit in the ordinary course of
business and consistent with past practices; (iii) deposits with banks or other
financial institutions; (iv) Administrative Borrower’s ownership of the
outstanding equity interests of GP Communications, LLC, a Delaware limited
liability company (“GP Communications”); and (v) Cash Equivalents and Senior
Lender’s money market accounts.
6.15    No Mergers; Equity Issuances. (a) Merge, consolidate, or enter into any
similar combination with any other entity or liquidate, windup, or dissolve
itself (or suffer any liquidation or dissolution); or (b) issue or sell any of
GP Communication’s equity securities;
6.16    [RESERVED]; or
6.17    No Transactions Prohibited by ERISA; Unfunded Liability. Directly or
indirectly
(a)    engage in any prohibited transaction which is reasonably likely to result
in a civil penalty or excise tax described in sections 406 of ERISA or 4975 of
the Internal Revenue Code for which a statutory or class exemption is not
available or a private exemption has not been previously obtained from the
Department of Labor;
(b)    permit to exist with respect to any benefit plan any accumulated funding
deficiency (as defined in sections 302 of ERISA and 412 of the Internal Revenue
Code, whether or not waived;
(c)    fail to pay timely required contributions or annual installments due with
respect to any waived funding deficiency to any benefit plan;
(d)    terminate any benefit plan where such event would result in any liability
of Borrower, any subsidiary of Borrower, or any of their ERISA affiliates under
Title IV of ERISA which was not paid in connection with such termination;
(e)    fail to make any required contribution or payment to any multiemployer
plan;
(f)    fail to pay any required installment or any other payment required under
section 412 of the Internal Revenue Code on or before the due date for such
installment or other payment;
(g)    amend a plan resulting in an increase in current liability for the plan
year such that Borrower, any subsidiary of Borrower, or any of their ERISA
affiliates is required to provide security to such plan under section 401(a)(29)
of the Internal Revenue Code; or
(h)    withdraw from any multiemployer plan where such withdrawal is reasonably
likely to result in any liability of such entity under Title IV of ERISA;

 
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any of which, individually or in the aggregate, would reasonably be expected to
result in, or have, a Material Adverse Effect.
7.    EVENTS OF DEFAULT
The occurrence of one or more of the following events shall constitute an “Event
of Default” under this Agreement. Unless expressly provided for in this Section
7, Lender is under no duty to provide Borrower or any other person with any
notice for an event to become an Event of Default:
7.1    Borrower shall fail to make any payment of sums due under this Agreement,
including any amounts specified in the Loan Chart, within three (3) days of the
applicable due date. A failure to pay includes any nonpayment as a result of
Lender’s inability to collect the entire sum due from Borrower’s Account;
7.2    Borrower shall breach any covenant or other obligation under Section 6 or
any other Loan Document;
7.3    Borrower shall breach any covenant, condition, or other obligation
contained in this Agreement (other than covenants and obligations described in
another subsection of this Section 7), which breach is not cured within fifteen
(15) calendar days after the earlier of written notice from Lender or the date
on which Borrower had actual knowledge of such breach;
7.4    Any financial statement, representation, warranty or certificate made or
furnished by or on behalf of Borrower or any guarantor of the Obligations in
connection with this Agreement or any other Loan Document shall be materially
false or misleading (including by omission) when made or reaffirmed;
7.5    Borrower or any guarantor of the Obligations shall become insolvent,
admit its/his/her insolvency, or shall be unable to pay its/his/her debts as
they mature;
7.6    Any judgments or arbitration awards are entered against Borrower or any
guarantor of the Obligations, or Borrower or any such guarantor enters into any
settlement agreement with respect to any litigation or arbitration and the
aggregate amount of all such judgments, awards and agreements exceeds $50,000;
7.7    (a) Borrower or any guarantor of the Obligations shall make an assignment
for the benefit of its/his/her creditors, file a petition in bankruptcy, be the
subject of an involuntary bankruptcy petition or be the subject of a pending
application, motion, or petition for the appointment of a receiver if such
application, motion, or petition is not dismissed with thirty (30) days of its
filing, or if a receiver is appointed; or (b) Borrower or any such guarantor by
any act or omission shall indicate its/his/her consent to, approval of, or
acquiescence in, any application or proceeding or order for relief or the
appointment of a custodian, receiver, or any trustee for any substantial part of
any of its/his/her properties;
7.8    Borrower or any guarantor of the Obligations shall have received any
order, or there shall have been imposed upon it any limitation, of any kind,
restricting its/his/her right to do business and/or its/his/her right to free
and unencumbered use and operation of any of the Collateral, by any court,
administrative body, or other regulatory or judicial authority purporting to
have jurisdiction over the business of Borrower or any guarantor of the
Obligations or the ownership and/or operation of such Collateral;
7.9    The occurrence of any uninsured loss, theft, damage, or destruction to
any material assets (or to a material portion of all assets) of Borrower or any
guarantor of the Obligations;
7.10    Any guarantor of the Obligations shall repudiate, purport to revoke, or
fail to perform such guarantor’s obligations under the applicable guaranty or
support agreement in favor of Lender;
7.11    Any federal, state, or local governmental body, instrumentality or
agency shall condemn, seize or otherwise appropriate, or take custody and
control of all or substantially all of the properties of Borrower or any
guarantor of the Obligations, or file a lien or levy an assessment in respect of
all, or substantially all, of the properties of Borrower or any guarantor of the
Obligations;

 
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7.12    If Borrower or any guarantor of the Obligations shall dissolve or
liquidate, or be dissolved or liquidated, or cease legally to exist, or merge or
consolidate, or be merged or consolidated with or into any corporation or
entity;
7.13    [RESERVED];
7.14    Default shall occur with respect to an indebtedness for borrowed money
(other than the Obligations) of Borrower or any of its subsidiaries in an
outstanding principal amount exceeding $100,000 and such default shall continue
for more than the period of grace, if any, therein with respect thereof, if the
effect thereof (with or without the giving of notice or further lapse of time or
both) is to accelerate, or permit the holder of any such indebtedness to
accelerate, the maturity any such indebtedness, or any such indebtedness shall
be declared due and payable or be required to be paid (other than by a regularly
scheduled required prepayment) prior to the stated maturity thereof;
7.15    Administrative Borrower (as defined below) shall no longer own, of
record and beneficially, one hundred percent (100%) of the equity interests in
GP Communications; or
7.16    There shall have occurred a Material Adverse Effect.
8.    REMEDIES UPON DEFAULT
At any time after any Event of Default, Lender may, without presentment, demand,
protest, or further notice of any kind (all of which are hereby expressly
waived, and in addition to any other remedies made available to Lender in any
other Loan Document, at law or in equity) take any one or more of the following
actions:
8.1    Declare all Obligations, including the entire remaining Total Payback
Amount, together with all loan costs and expenses and attorneys’ fees, to be
immediately due and payable. Lender shall be entitled to immediately enforce
payment of all Obligations by any means permitted by law or in equity;
8.2    Notify customers, account debtors or lessees of Borrower that Lender has
a security interest in the accounts, rights to payment, equipment, chattel paper
and general intangibles of Borrower and may collect them directly; Lender may
settle or adjust disputes and claims directly with account debtors or payment
processor companies or insurance companies for amounts and upon terms that
Lender considers advisable, and in such cases, Lender will credit the
Obligations under this Agreement with only the net amounts received by Lender,
after deducting all reasonable expenses incurred or expended in connection
therewith;
8.3    Make such payments and do such acts as Lender considers necessary or
reasonable to protect its security interest and Collateral. Borrower agrees to
assemble the Collateral if Lender so requires, and to make the Collateral
available to Lender as Lender may designate at a location which is reasonably
convenient to Borrower and Lender. Borrower authorizes Lender to enter the
premises where the Collateral is located, take and maintain possession of the
Collateral, or any part of it, and to pay, purchase, contest or compromise any
encumbrance, charge or lien which in the opinion of Lender appears to be prior
or superior to the Security Interest (other than the Permitted Encumbrances) and
to pay all expenses incurred in connection therewith. With respect to any of
Borrower’s owned or leased premises, Borrower hereby grants Lender a license to
enter into possession of such premises and to occupy the same, without charge,
in order to exercise any of Lender’s rights or remedies;
8.4    Ship, reclaim, recover, store, finish, maintain, repair, prepare for
sale, advertise for sale, and sell (in the manner provided for herein) the
Collateral. Lender is hereby granted a license or other right to use, without
charge, Borrower’s labels, patents, copyrights, rights of use of any name, trade
secrets, trade names, trademarks, and advertising matter, or any property of a
similar nature, as it pertains to the Collateral, in completing Lender’s
production, sale or general administration of the Collateral and Borrower’s
rights under all licenses and franchise agreements shall inure to Lender’s
benefit;
8.5    Sell the Collateral at either a public or private sale, or both, by way
of one or more contracts or transactions, for cash or on terms, in such manner
and at such places (including Borrower’s premises) as is commercially reasonable
in the opinion of Lender. It is not necessary that the Collateral be present at
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such sale. Lender shall not be obligated to make any sale of the Collateral
regardless of notice of sale having been given. Lender may adjourn any public or
private sale from time to time by announcement at the time and place fixed
therefor, and such sale may, without further notice, be made at the time and
place to which it was so adjourned;
8.6    Lender shall give notice of the disposition of the Collateral as follows:
(a)    Lender shall give Borrower and each holder of a security interest in the
Collateral a notice in writing of the time and place of public sale, or, if the
sale is a private sale or some other disposition other than a public sale is to
be made of the Collateral, the time on or after which the private sale or other
disposition is to be made;
(b)    The notice shall be personally delivered or mailed, postage prepaid, to
Borrower as provided in this Agreement, at least ten (10) calendar days before
the date fixed for the sale, or at least ten (10) calendar days before the date
on or after which the private sale or other disposition is to be made, unless
the Collateral is perishable or threatens to decline speedily in value;
8.7    Borrower agrees that Lender may obtain the appointment of a receiver or
keeper to take possession of all or any portion of the Collateral or to operate
same;
8.8    Any deficiency that exists after disposition of the Collateral as
provided above will be paid immediately by Borrower. Any excess will be returned
immediately, subject to the rights of third parties, and/or as provided by law,
to Borrower by Lender;
8.9    All payments received by Borrower in respect of the Collateral shall be
forthwith paid over to Lender in the same form as so received (with any
necessary endorsement), and may be held or applied by Lender to the Obligations
in such order as Lender may determine;
8.10    File suit for any sums owing or for damages; and
8.11    Exercise any other remedy or right provided in law or in equity or
permitted under this Agreement or by the California Uniform Commercial Code.
9.    REMEDIES CUMULATIVE
Any and all remedies conferred upon Lender shall be deemed cumulative with, and
non-exclusive of any other remedy conferred hereby or by law and/or equity.
Lender in the exercise of any one remedy shall not be precluded from the
exercise of any other. Lender may exercise any and all rights and remedies
available to it concurrently or independently, in such order, as frequently, and
at such time or times as Lender may, in its sole discretion, deem expedient.
10.    MISCELLANEOUS
10.1    Power of Attorney. Borrower hereby irrevocably appoints Lender as its or
his true and lawful attorney, as the case may be, with full power of
substitution, in Lender’s name or in its or his name or otherwise, for Lender’s
sole use and benefit, but at Borrower’s cost and expense, without notice to
Borrower or any other person, to exercise at any time and from time to time to:
(a)    demand, sue for, collect, receive, and give acquittance for any and all
monies due or to become due upon or by virtue thereof;
(b)    receive, take, endorse, assign, and deliver any and all checks, notes,
drafts, documents, negotiable or non-negotiable instruments, or chattel paper in
connection therewith;
(c)    settle, compromise, compound, prosecute or defend any action or
proceeding, including, without limitation, a foreclosure action, with respect
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(d)    extend or modify terms of payment or make any allowance or other
adjustment with respect thereto; or
(e)    notify account debtors of the security interest granted hereby and
instruct such account debtors that payment of their respective accounts is to be
made directly to Lender and take control of any and all such payments or other
proceeds of such accounts.
10.2    Attorneys’ Fees and Costs. Borrower shall pay on demand all of Lender’s
reasonable attorneys’ fees and out-of-pocket costs incurred by Lender in: (a)
enforcing this Agreement or any other Loan Documents and Lender’s rights in its
Collateral; and (b) the collection of any amounts due under this Agreement or
any other Loan Documents, whether or not suit is brought. Further, Lender shall
be entitled to all attorneys’ fees and costs incurred by Lender in connection
with any Bankruptcy proceeding of Borrower, including any and all attorneys’
fees and costs incurred to preserve, protect, monitor, or realize upon the
Obligations and any security for such Obligations. The costs incurred by Lender
include but are not limited to appraisal fees, filing fees, audit and inspection
fees, and all other out-of-pocket costs and expenses incurred by Lender.
10.3    Waivers.
(a)    Borrower hereby waives presentment, demand, notice, protest, notice of
acceptance of this Agreement, notice of loans made, credit extended, collateral
received or delivered or other action taken in reliance herein, and all other
demands and notices of any kind or description. With respect to the Obligations
and the Collateral, Borrower assents to any extension or postponement of the
time of payment or any other indulgence, to any substitution, exchange or
release of Collateral, to the addition or release of any person or entity
primarily or secondarily liable therefor, to the acceptance of partial payments
thereon and the settlement, compromise, or adjustment of any thereof, all in
such manner and at such time or times as Lender may deem advisable in its sole
and absolute discretion. Lender shall have no duty as to the collection or
protection of the Collateral or any income therefrom, as to the preservation of
rights against prior parties, or as to the preservation of any rights pertaining
to the Collateral beyond the safe custody thereof. Lender may exercise its
rights with respect to the Collateral without resorting or regard to any other
collateral or sources of payment for liability;
(b)    Neither any failure nor any delay on the part of Lender in exercising any
right, power, or privilege hereunder or under this Agreement or any other Loan
Document shall operate as a waiver thereof, nor shall a single or partial
exercise thereof preclude any other or further exercise thereof or the exercise
of any other right, power or privilege. Lender shall not be deemed to have
waived any of its rights with respect to the Obligations or Collateral hereunder
or under any other written document, unless such waiver is in writing and signed
by Lender.
10.4    Monitoring, Recording, and Electronic Communications. In order to ensure
a high quality of service for Lender’s customers, Lender may monitor and/or
record telephone calls between Borrower and Lender’s employees. Borrower
acknowledges that Lender may do so and agrees in advance to any such monitoring
or recording of telephone calls. Borrower also agrees that Lender may
communicate with Borrower electronically by email.
10.5    No Third-Party Beneficiary. This Agreement is made solely between
Borrower and Lender and no other person shall have any right of action hereunder
and the parties expressly agree that no person shall be a third-party
beneficiary to this Agreement.
10.6    Indemnity. Borrower agrees to indemnify, defend, and hold harmless
Lender, its employees, members, directors, managers, officers, or agents from
and against any loss, liability, damage, penalty or expense (including
attorneys’ fees, expert witness fees, and cost of defense) they may suffer or
incur as a result of: (a) any failure by Borrower or any employee, agent or
Affiliate of Borrower to comply with the terms of this Agreement, any of the
other Loan Documents, or any other legal obligation to Lender; (b) any warranty
or representation made by Borrower being false or misleading; (c) any
representation or warranty made by Borrower, or any employee or agent of
Borrower to any third person; (d) negligence of Borrower or its/his/

 
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her agents or employees; or (e) any alleged or actual violations by Borrower or
its/his/her subcontractors, employees or agents of any governmental laws,
regulations or rules.
10.7    Assignment. This Agreement shall inure to the benefit of and be binding
upon the parties hereto and their respective executors, administrators, heirs,
successors, and assigns, provided, however, that neither this Agreement nor any
rights or Obligations hereunder shall be assignable by (i) Borrower without
first obtaining the express written consent of Lender or (ii) by Lender without
first obtaining the express written consent of Borrower; provided that no
consent of Borrower shall be required if (x) an assignment is made by Lender to
an Affiliate of Lender or by operation or law; or (y) an Event of Default has
occurred and is continuing. Any purported assignment made in contravention of
the forgoing consent shall be void. Lender may assign any part of or all of the
Loan and its rights and Obligations hereunder at any time in its sole and
absolute discretion without notifying or disclosing to Borrower the assignment
of this Agreement. Lender may sell participations in all or any portion of the
Loan to such other party or parties as Lender shall select, all without notice
or disclosure to Borrower.
10.8    Maximum Interest. If Lender contracts for, charges, or receives any
consideration that constitutes interest in excess of the highest lawful rate
that is permissible under the law applicable to this Agreement, then any such
excess shall be canceled automatically and, if previously paid, shall at such
Lender’s option be applied to the outstanding amount of the Loan made hereunder
or be refunded to Borrower. In determining whether the interest contracted for,
charged, or received by Lender exceeds the highest lawful rate, Lender may, to
the extent permitted by applicable law: (a) characterize any payment that is not
principal as an expense, fee, or premium rather than interest; (b) exclude
voluntary prepayments and the effects thereof; and (c) amortize, prorate,
allocate, and spread in equal or unequal parts the total amount of interest,
throughout the contemplated term of the Loan hereunder.
10.9    Time Is of the Essence. The Parties hereto expressly acknowledge and
agree that time is of the essence and that all deadlines and time periods
provided for under this Agreement are ABSOLUTE AND FINAL.
10.10    Notices. Any notices required or permitted to be given pursuant to this
Agreement shall be in writing and may be given by personal delivery, email,
facsimile, first class mail via the United States Postal Service, postage
prepaid, or by any overnight courier by sending said notice to Borrower at the
address set forth its signature below or to Lender at the following address:
Super G Capital, LLC

23 Corporate Plaza, Suite 100

Newport Beach, CA 92660
If either party desires to change the address or email and fax numbers to which
notices are to be sent, it shall do so in writing and deliver the same to the
other party in accordance with the notice provisions set forth above. Any notice
given by any party under this Agreement shall be effective upon a party’s
receipt of the notice or if mailed, upon the earlier of a party’s receipt of the
notice and the third (3rd) Business Day after the mailing of the notice.
10.11    Modifications. This Agreement may not be modified, amended, waived,
extended, changed, discharged, or terminated orally or by any act or failure to
act on the part of Borrower or Lender, but only by an agreement in writing
signed by the party against whom enforcement of any modification, amendment,
waiver, extension, change, discharge, or termination is sought.
10.12    Severability. If any term or provision of this Agreement or the
application thereof to any circumstance, shall be invalid, illegal, or
unenforceable to any extent, such term or provision shall not invalidate or
render unenforceable any other term or provision of this Agreement or the
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any other circumstance then to the extent permitted by law, Borrower and Lender
hereto hereby waive any provision of law that renders any term or provision
hereof invalid or unenforceable in any respect.
10.13    Definitions. As used herein, (a) an “Affiliate” of a person or entity
means any other person or entity which, directly or indirectly, controls or is
controlled by or is under common control with that entity; an entity shall be
deemed to be “controlled by” any other person or entity if such person or entity
possesses, directly or indirectly, power to vote fifty percent (50%) or more of
the securities (on a fully diluted basis) having ordinary voting power for the
election of directors or managers or power to direct or cause the direction of
the management and policies of such entity whether by contract or otherwise; (b)
“Business Day” means any calendar day other than Saturdays, Sundays and official
Federal Holidays; (c) “Loan Documents” means, collectively, this Agreement, the
other documents described in Addendum 2, and all other documents evidencing,
securing or relating to the Obligations or executed in connection herewith, and
all amendments and modifications of any of the foregoing; (d) “Material Adverse
Effect” means with respect to any event, act, condition or occurrence of
whatever nature (including any adverse determination in any litigation,
arbitration, or governmental investigation or proceeding), whether singly or in
conjunction with any other event or events, act or acts, condition or
conditions, occurrence or occurrences, whether or not related, a material
adverse change in, or a material adverse effect upon, any of (i) the condition
(financial or otherwise), operations, business, properties or prospects of
Borrower or any guarantor of the Obligations, (ii) the rights and remedies of
Lender under any Loan Document, or the ability of Borrower or any guarantor of
the Obligations to perform any of his/her/its obligations under any Loan
Document to which he/she/it is a party, (iii) the legality, validity or
enforceability of any Loan Document, or (iv) the existence, perfection or
priority of any part of the Lender's Lien or the value of any material
Collateral; (e) “Subordinated Debt” means debt incurred by Borrower that is
subordinated to the debt owing by Borrower to Lender on terms acceptable to
Lender; and (f) “Cash Equivalents” means (i) marketable direct obligations
issued or unconditionally guaranteed by the United States of America or any
agency or any State thereof maturing within one (1) year from the date of
acquisition thereof, (ii) commercial paper maturing no more than one (1) year
from the date of creation thereof and currently having rating of at least A-2 or
P-2 from either Standard & Poor’s Corporation or Moody’s Investors Service, and
(iii) certificates of deposit maturing no more than one (1) year from the date
of investment therein issued by Senior Lender.
11.    GOVERNING LAW, FORUM SELECTION, AND CONSENT TO JURISDICTION
The Loan Documents shall be governed by and construed in accordance with the
laws of the State of California without reference to its choice of law
provisions. Lender and Borrower agree that: (a) all actions or proceedings
arising out of or related to the Loan Documents; (b) any written agreements
between or related to Lender and Borrower; and (c) all other disputes,
regardless of whether arising out of contract or solely a tort, shall be tried
and litigated exclusively in the state and federal courts located in the Orange
County, California in a city to be designated by Lender, or in the City of Los
Angeles, State of California. This choice of venue is intended to be mandatory
and not permissive, thereby precluding the possibility of litigation between the
Lender and Borrower in any jurisdiction other than that specified herein.
Borrower hereby waives any right it may have to assert the doctrine of forum non
conveniens (or any similar doctrine) or to otherwise raise any objection to
venue with respect to any proceeding arising out of or related to this Agreement
or any other written agreements between Lender and Borrower.
Lender and/or Borrower irrevocably and unconditionally consent to personal
jurisdiction in California and venue in in any action in Orange County,
California, in a city to be designated by Lender, or in the City of Los Angeles,
State of California. Borrower further stipulates that the state and federal
courts located in Orange County, California or the City of Los Angeles, State of
California shall have in personam jurisdiction and venue over Borrower for the
purpose of litigating any dispute, controversy, or proceeding arising out of or
related to: (i) this Agreement; and (ii) all other written agreements between
the Borrower and Lender, including, without limitation, petitions to compel the
judicial reference and to enforce the statement of decision by the referee.
Any action filed by Borrower or Lender shall be filed in the Los Angeles County
Superior Court, Central Judicial District or the Federal District Court for the
Central District of California located in the City of Los Angeles, or the
Federal District Court for the Central District of California located in Orange
County, California. The judicial reference proceedings shall be conducted in the
City of Los Angeles, California or in Orange County, California, in a city to be
designated by Lender.

 
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12.    JUDICIAL REFERENCE
12.1    At the request of either Lender or Borrower, any controversy or claim
between or amongst Lender and Borrower, regardless of whether the dispute or
controversy arises under or is related to this Agreement, shall be determined by
a reference in accordance with California Code of Civil Procedure sections 638,
et seq. Judgment upon the award rendered by such referee shall be entered in the
court in which such proceeding was commenced in accordance with California Code
of Civil Procedure sections 644 and 645.
12.2    Selection or Appointment of Referee. When Lender and Borrower are
involved in any dispute or controversy (the “Reference Parties”) they shall
jointly select a single neutral referee who shall be a retired state or federal
judge. In the event the Reference Parties cannot agree upon a referee, a single
neutral referee shall be appointed by the court in accordance with the procedure
set forth in Code of Civil Procedure section 640(b).
12.3    Conduct of Reference. The judicial reference shall be conducted pursuant
to California law. The referee shall determine all issues relating to the
applicability, interpretation, legality, or enforceability of all agreements.
The referee shall report a statement of decision to the court. The Reference
Parties shall equally bear the fees and expenses of the referee. The prevailing
party shall be entitled to recover the fees and expenses that it/he/she paid to
the referee and such fees and expenses shall be awarded in the statement of
decision.
12.4    Reference Constitutes a Waiver of the Right to a Jury Trial. Borrower
and Lender understand and acknowledge that by agreeing to judicial reference,
Borrower and Lender each are hereby knowingly, voluntarily, and intentionally
waiving any right (whether arising under the Constitution of the United States,
the State of California, or of any other state, or under any foreign
jurisdiction, under any statutes regarding or rules of civil procedure
applicable in any state or federal or foreign legal proceeding, under common
law, or otherwise) to demand or have a trial by jury of any claim, demand,
action, or cause of action arising under, relating, or appertaining to: (i) this
Agreement; (ii) any written agreements between Lender and Borrower; (iii) any
disputes or controversies in any way connected with or related or incidental to
the discussions, dealings, or actions between Lender and Borrower (whether oral
or written); and (iv) any claims now existing or hereafter arising between
Lender and Borrower, whether sounding in contract or tort or otherwise.
Each of the Reference Parties hereby agrees and consents that any such claim,
demand, action, or cause of action shall be decided by the referee without a
jury, and that any of the Reference Parties may file an original counterpart or
a copy of this Agreement with any court as written evidence of its waiver of
right to trial by jury. The Reference Parties acknowledge and agree that they
have received full and sufficient consideration for this provision (and each
other provision of each other related document to which they are a party) and
that this provision is a material inducement for the Lender in accepting this
Agreement. By waiving a jury trial, the Reference Parties intend claims and
disputes to be resolved by the referee and/or judge acting without a jury in
order to avoid the delays, expense, and risk of mistaken interpretations which
each Party acknowledges to be greater with jury trials than with nonjury trials.
12.5    Provisional Remedies, Self-Help And Foreclosure. No provision of this
Agreement or written agreements between the Lender and Borrower, will limit the
right of Lender to: (a) foreclose against any real property collateral by the
exercise of a power of sale under a deed of trust, mortgage, or other security
agreement or instrument, or applicable law; (b) exercise any rights or remedies
as a secured party against any personal property collateral pursuant to the
terms of a security agreement or pledge agreement or applicable law; (c)
exercise self-help remedies such as setoff; or (d) obtain provisional or
ancillary remedies such as injunctive relief, writs of attachment, writs of
possession, or the appointment of a receiver from a court having jurisdiction
before, during, or after the pendency of any referral. The institution and
maintenance of an action for judicial relief or pursuit of provisional or
ancillary remedies or exercise of self-help remedies will not constitute a
waiver of the right of any party, including the plaintiff, to submit any dispute
to judicial reference.
13.    NO FIDUCIARY RELATIONSHIP

 
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Borrower hereby acknowledges that Lender does not have any fiduciary
relationship to Borrower, and the relationship between Lender, on the one hand,
and Borrower, on the other hand, is solely that of creditor and debtor and no
joint venture exists between Lender and Borrower.
14.    RULES OF CONSTRUCTION
Lender and Borrower have participated in the preparation and/or review of this
Agreement, and this Agreement shall be deemed the result of the joint efforts of
Lender and Borrower. This Agreement has been accepted and approved as to its
final form by Borrower and upon the advice of its counsel, but shall not be
deemed accepted and approved by Lender until duly executed in the State of
California by its duly authorized officer. Borrower acknowledges that the Loan
is being made in the State of California and that all payments of the
Obligations are not accepted until received by Lender in the State of
California. Borrower further acknowledges that if Borrower elected not to
consult with an attorney before signing this Agreement, Borrower had ample to
time to hire an attorney and obtain a review this Agreement by counsel before
signing this Agreement. Accordingly, any uncertainty or ambiguity existing in
this Agreement shall not be interpreted against either Lender or Borrower as a
result of the manner of the preparation and presentation of this Agreement.
Borrower and Lender agree that any statute or rule of construction providing
that ambiguities are to be resolved against the drafting party shall not be
employed in the interpretation of this Agreement and are hereby waived.
15.    COUNTERPARTS
This Agreement and the other Loan Documents may be executed in one or more
counterparts, each of which shall be deemed to be an original, and such
counterparts shall together constitute one and the same instrument. The
signatures to this Agreement may be evidenced by facsimile or scanned email
copies reflecting the party’s signature hereto, and any such facsimile copy or
scanned email copies shall be sufficient to evidence the signature of such party
as if it were an original signature. Any failure by such Borrower or Lender to
deliver original counterparts shall not affect the validity or the delivery of
this Agreement or any documents in writing between Lender and Borrower.
16.    ENTIRE AGREEMENT
This Agreement constitutes the entire agreement between the Lender and Borrower
with respect to the subject matter hereof, and supersedes all other agreements,
oral or written, between Lender and Borrower with respect to the subject matter.
Borrower acknowledges and represents that it/he/she has read this Agreement and
the other Loan Documents carefully and that there have been no oral or written
statements made to it/he/she by Lender or any other party that contradicts,
varies, or would change the meaning of any statements, promises, or agreements
set forth in this Agreement. Borrower acknowledges that a failure to review this
Agreement or any of the other Loan Documents before signing them precludes any
claim that any such Loan Documents do not represent the true and accurate
agreement of the Lender and Borrower. No claim of waiver, modification, consent
or acquiescence with respect to any provision of this Agreement shall be made
against any party herein, except upon the basis of a written instrument executed
by or on behalf of such party, which written instrument must expressly reference
this Agreement.
[SIGNATURES ON FOLLOWING PAGE]

 
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BORROWER:
LENDER:
GLOWPOINT, INC., a Delaware corporation

SUPER G CAPITAL, LLC
By: /s/ David Clark
 
Name: David Clark
 
Title: Chief Financial Officer
GP COMMUNICATIONS, LLC, a Delaware
limited liability company

By: Glowpoint, Inc., its Managing Member

By: /s/ David Clark
 
Name: David Clark
 
Title: Chief Financial Officer
By: /s/ Marc Cole
      Marc Cole, Chief Financial Officer
Address:
1766 Lincoln Street, 13th Floor
Denver, CO 80203
 
Attention: David Clark
Email: dclark@glowpoint.com
 

[SIGNATURE PAGE FOR BUSINESS LOAN AND SECURITY AGREEMENT]

 
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This Authorization Agreement for Direct Deposit (ACH Credit) and Direct Payments
(ACH Debits) (this “Authorization”) is part of (and is fully incorporated herein
by reference into) the Business Loan and Security Agreement above (the “Loan
Agreement”).
DISBURSEMENT OF LOAN PROCEEDS. By signing below, Borrower authorizes Lender to
disburse the Loan proceeds less the amount of any applicable fees and/or debit
the account for any fees related to the Loan Agreement upon Loan approval by
initiating an ACH credit to the checking account indicated below (or a
substitute checking account Borrower later identifies and is acceptable to
Lender) (hereinafter referred to as the “Borrower Account”) in the disbursed
amount set forth in the Loan Agreement. This Authorization is to remain in full
force and effect until Lender has received written notification from Borrower of
its termination in such time and in such manner as to afford Lender and
Borrower’s depository bank a reasonable opportunity to act on it.
By signing below, Borrower agrees and authorizes Lender to collect payments
required under the terms of this Agreement by initiating ACH debit entries to
Borrower’s Account in the amounts and on the dates provided in the payment
schedule set forth in the Loan Agreement. Borrower authorizes Lender to increase
the amount of any scheduled ACH debit entry by the amount of any previously
scheduled payment(s) that was not paid as provided in the payment schedule and
any unpaid returned payment charges and/or late fees. This Authorization is to
remain in full force and effect until Lender has received written notification
from Borrower of its termination in such time and in such manner as to afford
Lender and Borrower’s depository bank a reasonable opportunity to act on it.
Lender may suspend or terminate Borrower’s enrollment in the automatic payment
plan effected by this Authorization immediately if Borrower fails to keep
Borrower’s Account in good standing or if there are insufficient funds in
Borrower’s Account to process any payment. If Borrower revokes this
Authorization, Borrower still will be responsible for making timely payments
pursuant to the alternative payment methods described in the Loan Agreement.
BUSINESS PURPOSE ACCOUNT. By signing below, Borrower attests that Borrower’s
Account was established for business purposes and not for personal, family, or
household purposes.
ACCOUNT CHANGES. Borrower agrees to notify Lender promptly if there are any
changes to the account and routing numbers of the Borrower Account.
MISCELLANEOUS. Lender is not responsible for any fees charged by Borrower’s bank
as the result of credits or debits initiated under this Authorization. The
origination of ACH transactions to or from Borrower’s Account must comply with
all provisions of applicable law.
BANK INFO
BANK NAME
Wells Fargo Bank, N.A.
ACCOUNT NAME
Glowpoint, Inc.
ABA ROUTING NO.
121000248
ACCOUNT NO.
4541792289

BORROWER:
GLOWPOINT, INC.
By: /s/ David Clark
Name: /s/ David Clark
Title: Chief Financial Officer
Address:
1766 Lincoln Street, 13th Floor
Denver, CO 80203

 
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SCHEDULE 1
BORROWER AFFILIATES
GP COMMUNICATIONS, LLC, a Delaware limited liability company

SCHEDULE 2
SUBORDINATED DEBT HOLDERS
Name of Holder
Amount of Subordinated Debt
None.
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

ADDENDUM 1
PERMITTED ENCUMBRANCES
Each of the following shall be considered “Permitted Encumbrances”:
(a)    liens arising under this Agreement and the other Loan Documents;
(b)    liens for taxes, fees, assessments or other government charges or levies,
either (i) not due and payable or (ii) being contested in good faith and for
which Borrower maintains adequate reserves on its books;
(c)    purchase money liens securing Purchase Money Debt (i) on equipment
acquired or held by Borrower incurred for financing the acquisition of the
equipment, or (ii) existing on equipment when acquired, in each case if the lien
is confined to the equipment and improvements and the proceeds of the equipment;
(d)    liens of carriers, warehousemen, suppliers, landlords or other persons
that are possessory in nature arising in the ordinary course of business so long
as the amount secured by such liens is not delinquent or which are being
contested in good faith and by appropriate proceedings which proceedings have
the effect of preventing the forfeiture or sale of the property subject thereto;
(e)    liens to secure payment of workers’ compensation, employment insurance,
old-age pensions, social security and other like obligations incurred in the
ordinary course of business;
(f)    liens incurred in the extension, renewal or refinancing of the
indebtedness secured by liens described in clause (c), but any extension,
renewal or replacement lien must be limited to the property encumbered by the
existing lien and the principal amount of the indebtedness may not increase;
(g)    leases or subleases of real property granted in the ordinary course of
business, and leases, subleases, non-exclusive licenses or sublicenses of
property granted in the ordinary course of Borrower’s business, if the leases,
subleases, licenses and sublicenses do not prohibit granting Lender a security
interest;
(h)    non-exclusive licenses of intellectual property granted to third parties
in the ordinary course of business;
(i)    liens arising from judgments, orders, decrees or attachments in
circumstances not constituting an Event of Default under Section 7.6;
(j)    security interest in favor of Senior Lender pursuant to the Senior Loan
Documents;
(k)    easements, rights of way, covenants, restrictions, reservations,
exceptions and other similar restrictions and encumbrances or title defects, in
each case existing when the property was acquired or incurred in the ordinary
course of business which, in the aggregate, do not materially detract from the
value or usefulness of the property subject thereto or materially interfere with
the ordinary conduct of business of Borrower;
(l)    liens on indebtedness described in clauses (c), (d) and (e) of Section
6.2; and
(m)    rights of setoff liens upon deposits of funds in favor of banks or other
depository institutions, solely to the extent incurred in connection with the
maintenance of such deposit accounts in the ordinary course of business.

ADDENDUM 2
CONDITIONS TO FUNDING
As conditions precedent to Lender funding the Loan, Borrower shall have:
A.    Delivered to Lender, in form and content acceptable to Lender, fully
executed copies of the following:
1.
This Agreement;

2.
Warrant in favor of Lender;

3.
Payoff letter from Existing Secured Lender;

4.
A certificate of insurance covering the Collateral and the location of the
Collateral, naming Lender as additional insured and loss payee;

5.
Intellectual property security agreement between Borrower and Lender;

5.
Debt and lien subordination agreement between Borrower, Lender and Senior
Lender, which provides, among other things, that any Lender payment standstill
shall not exceed one hundred twenty (120) days;

6.
Senior Loan Documents;

7.
Confirmation that the SRS Note (as defined in Administrative Borrower's Form
10-K filed March 31, 2017 with the Securities and Exchange Commission) has been
converted into equity of Administrative Borrower; and

8.
Such other documents as may be reasonably required by Lender;

B.
Completed all matters described on Addendum 4 which are required to be completed
prior to funding the Loan.

ADDENDUM 3
ADDITIONAL COVENANTS
1.    Financial Covenants. So long as any of the Obligations remain outstanding,
Borrower shall do the following:
(a)    Minimum Unrestricted Cash. Maintain unrestricted cash with Senior Lender
in an amount of not less than the sum of (i) $200,000 plus (ii) the aggregate
outstanding Advances under the Non-Formula Amount (as those terms are defined in
the Senior Loan Agreement);
(b)     Minimum Adjusted EBITDA. Maintain Adjusted EBITDA of Borrower, as
calculated in accordance with GAAP, in an amount no less than $200,000 for each
three (3) month period ending on the last date of each fiscal quarter of
Borrower;
As used herein, (i) "EBITDA" means, for the three (3) month period ending on the
applicable date, net profit before tax plus interest expense, depreciation
expense, amortization expenses, stock compensation expense, non-cash impairment
charges on goodwill or other intangible assets, and non-cash impairment charges
on property and equipment in an amount up to $250,000 per fiscal year and minus
gain on debt extinguishment; and "Adjusted EBITDA" means, for the three (3)
month period ending on the applicable date, without duplication, EBITDA plus net
proceeds from any equity capital raised by Borrower during the term of this
Agreement, calculated on a cumulative, rolling basis (provided that any net
proceeds from an equity capital raise applied during any previous three (3)
month period in an amount up to such amount necessary to achieve minimum
Adjusted EBITDA as set forth in clause (b) above shall not be applied by
Borrower for purposes of determining compliance with such requirement during any
subsequent fiscal quarter);

(c)    Reports to Lender. Report to Lender calculation of compliance or
non-compliance with the covenants set forth in clauses (a) and (b) above no
later than thirty (30) days following the end of the applicable month; and
(d)    Monthly Statements. Send Lender copies of monthly statements pertaining
to Borrower’s accounts at Senior Lender within thirty (30) days after the end of
each calendar month.
2.    Post-Closing Covenants. Borrower shall deliver to Lender the following, in
form and substance acceptable to Lender:
(a)    [Reserved]
3.    Joint and Several Liability of the Borrowers.
(a)    For purposes of this Section 3 and Section 4 below, “Borrowers” means,
collectively, all of the entities comprising Borrower (as defined on the Loan
Chart on the first page of this Agreement), and any Borrower shall mean any one
of the entities comprising Borrower (as defined on the Loan Chart).
(b)    Notwithstanding anything in this Agreement or any other Loan Document to
the contrary, each of the Borrowers hereby accepts joint and several liability
hereunder and under the other Loan Documents in consideration of the financial
accommodations to be provided by Agent under this Agreement and the other Loan
Documents, for the mutual benefit, directly and indirectly, of each of the
Borrowers and in consideration of the undertakings of the other Borrowers to
accept joint and several liability for the Obligations. Each of the Borrowers,
jointly and severally, hereby irrevocably and unconditionally accepts, not
merely as a surety but also as a co-debtor, joint and several liability with the
other Borrowers, with respect to the payment and performance of all of the
Obligations (including, without limitation, any Obligations arising under this
Section 3), it being the intention of the parties hereto that all the
Obligations shall be the joint and several obligations of each of the Borrowers
without preferences or distinction among them. If and to the extent that any of
the Borrowers shall fail to make any payment with respect to any of the
Obligations as and when due or to perform any of the Obligations in accordance
with the terms thereof, then in each such event the other Borrowers will make
such payment with respect to, or perform, such Obligation. Subject to the terms
and conditions hereof, the Obligations of each of the Borrowers under the
provisions of this Section 3 constitute the absolute and unconditional, full
recourse Obligations of each of the Borrowers enforceable against each such
person to the full extent of its properties and assets, irrespective of the
validity, regularity or enforceability of this Agreement, the other Loan
Documents or any other circumstances whatsoever.
(c)    The provisions of this Section 3 are made for the benefit of the Agent
and its successors and assigns, and may be enforced by them from time to time
against any or all of the Borrowers as often as occasion therefor may arise and
without requirement on the part of Agent or such successors or assigns first to
marshal any of its or their claims or to exercise any of its or their rights
against any of the other Borrowers or to exhaust any remedies available to it or
them against any of the other Borrowers or to resort to any other source or
means of obtaining payment of any of the Obligations hereunder or to elect any
other remedy. The provisions of this Section 3 shall remain in effect until all
of the Obligations shall have been paid in full or otherwise fully satisfied.
(d)    Each of the Borrowers hereby agrees that it will not enforce any of its
rights of contribution or subrogation against the other Borrowers with respect
to any liability incurred by it hereunder or under any of the other Loan
Documents or any payments made by it to Agent with respect to any of the
Obligations or any Collateral until such time as all of the Obligations (other
than contingent indemnification Obligations) have been paid in full in cash. Any
claim which any Borrower may have against any other Borrower with respect to any
payments to Agent hereunder or under any other Loan Documents are hereby
expressly made subordinate and junior in right of payment, without limitation as
to any increases in the Obligations arising hereunder or thereunder, to the
prior payment in full in cash of the Obligations (other than contingent
indemnification Obligations).
4.    Appointment of Agent for the Borrowers. Each Borrower hereby irrevocably
appoints GLOWPOINT, INC., as the borrowing agent and attorney-in-fact for the
Borrowers (the “Administrative Borrower”), which appointment shall remain in
full force and effect unless and until Agent shall have received prior written
notice signed by all of the Borrowers that such appointment has been revoked and
that another Borrower has been appointed Administrative Borrower. Each Borrower
hereby irrevocably appoints and authorizes the Administrative Borrower (i) to
provide Agent with all notices and instructions under this Agreement and (ii) to
take such action as the Administrative Borrower deems appropriate on its behalf
to exercise such other powers as are reasonably incidental thereto to carry out
the purposes of this Agreement. It is understood that the handling of the
Collateral of the Borrowers in a combined fashion, as more fully set forth
herein, is done solely as an accommodation to the Borrowers in order to utilize
the collective borrowing powers of the Borrowers in the most efficient and
economical manner and at their request, and that Agent shall not incur liability
to the Borrowers as a result hereof. Each of the Borrowers expects to derive
benefit, directly or indirectly, from the handling of the Collateral in a
combined fashion since the successful operation of each Borrower is dependent on
the continued successful performance of the integrated group. To induce Agent to
do so, and in consideration thereof, each of the Borrowers hereby jointly and
severally agrees to indemnify the Agent Related Persons and the Lender Related
Persons and hold all of them harmless against any and all liability, expense,
loss or claim of damage or injury, made against such indemnitee by any of the
Borrowers or by any third party whosoever, arising from or incurred by reason of
(a) the handling of the Collateral of the Borrowers as herein provided, (b)
Agent relying on any instructions of the Administrative Borrower, or (c) any
other action taken by Agent hereunder or under the other Loan Documents.

ADDENDUM 4
LOAN CLOSING CHECKLIST
☐Items have not been submitted
/ Items submitted, but missing key information
☒Items submitted

CLOSING DOCUMENTATION AND CONDITIONS

 
1.    SGC Business Loan Security Agreement
☐
 
2.    ACH Authorization
☐
 
3.    Certificates of Insurance
☐
 
4.    Warrant
☐
 
5.    Payoff Letter from Existing Secured Lender
☐
 
6.    Debt and Lien Subordination Agreement with Senior Lender
☐
 
7.    Intellectual Property Security Agreements
☐
 
8.    [Subordination Agreements from Subordinated Creditors]
☐
 
9.    Confirmation of Conversion of SRS Note
☐
 
10.    Delivery of Senior Loan Documents
☐
 
11.    UCC-1 Financing Statements
☐
 

LEGAL DUE DILIGENCE
 
1.    Litigation Searches
☐
 
2.    UCC Searches
☐
 
3.    IP Searches
☐
 
4.    Certificate of Good Standing
☐
 
5.    Certified Articles
☐
 
6.    Debt Schedule
☐
 

POST-CLOSING ITEMS
 
Task/Document
 
 
 
1.    Certified UCC Search
 
 
☐
 

Senior Lender – Western Alliance Bank
Existing Secured Lender—Main Street Capital

 
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