Exhibit 10.47


 


SUBORDINATION AGREEMENT


 


This Subordination Agreement (the “Agreement”)
is made and entered into as of January 12, 2005, by and between NV
Partners III-BT LP, a Cayman Islands Limited Partnership (“Subordinated
Creditor”), and @Road, Inc. (“Senior Creditor”).


 


RECITALS


 


Vidus Limited, a company registered in England and
Wales under registered number 4069823 having its registered office at North
Felaw Maltings, 48 Felow Street, Ipswich, Suffolk IP2 8HE (“Borrower”),
has entered into a certain Loan and Security Agreement, dated January 12,
2005 with Senior Creditor (as amended from time to time, the “Loan Agreement”)
pursuant to which Senior Creditor has agreed to extend credit to Borrower.  Pursuant to a Debenture between Borrower and
Subordinated Creditor dated April 2003, Subordinated Creditor has extended
credit to Borrower (the “Subordinated Loan”).  Senior Creditor, as a condition to extending
to Borrower the credit contemplated by the Loan Agreement, requires the
execution of this Agreement by Subordinated Creditor in order to subordinate
the indebtedness of Borrower arising under the Subordinated Loan to the
indebtedness of Borrower to Senior Creditor arising under the Loan
Agreement.  Subordinated Creditor is
willing to enter into this Agreement in order to induce Senior Creditor to make
loans or extend credit or any other financial accommodations to or for the
benefit of Borrower.


 


AGREEMENT


 


For good and valuable consideration, the receipt and
sufficiency of which are hereby expressly acknowledged, Subordinated Creditor
hereby agrees with Senior Creditor as follows:


 


1.                                       Certain Definitions.  The following terms shall have the following
meanings for the purposes of this Agreement:


 


“Senior Indebtedness” shall mean all
indebtedness, obligations and liabilities of Borrower (including, without
limitation, principal, interest, fees, costs, expenses and reasonable attorneys’
fees), now or hereafter owed by Borrower to Senior Creditor, including, without
limitation, the principal of, interest on and all other amounts owing under,
the Loan Agreement, and any renewals, replacements, substitutions, amendments,
modifications, refinancings or refundings thereof.


 


“Subordinated Indebtedness” shall mean all
indebtedness, obligations and liabilities of Borrower (including, without
limitation, principal, interest, fees, costs, expenses and reasonable attorneys’
fees), now or hereafter owed by Borrower to Subordinated Creditor, including,
without limitation, the principal of, interest on and all other amounts owing
under, the Subordinated Loan, and any renewals, replacements, substitutions,
amendments, modifications, refinancings or refundings thereof.


 


2.                                       Subordination.  Subordinated Creditor agrees that payment of
the Subordinated Indebtedness is expressly subordinated to the prior payment in
full of all Senior Indebtedness.


 





















 


Unless and until the
Senior Indebtedness shall have been fully paid and satisfied and all financing
arrangements between Borrower and Lender pursuant to the Loan Agreement have
been terminated, Subordinated Creditor will not, without the prior written
consent of Lender (i) accelerate, ask, demand, sue for, take or receive from or
on behalf of Borrower, by set-off or in any other manner, the whole or any part
of any monies which may now or hereafter be owing to Subordinated Creditor on
the Subordinated Indebtedness, (ii) initiate or participate with others in any
suit, action or proceeding against Borrower to collect the whole or any part of
the Subordinated Indebtedness, or (iii) ask, demand, take or receive any
security for any of the Subordinated Indebtedness.  This subordination provision shall apply with
respect to all of the Senior Indebtedness, regardless of the amount of the
Senior Indebtedness or how or in what manner the Senior Indebtedness is
incurred, or whether the Senior Indebtedness has already been incurred or may
be incurred in the future by future advances or other financial accommodations
made or extended by Lender, or whether such future advances or other financial
accommodations are made at the discretion of Lender or pursuant to commitment
or otherwise.  If Subordinated Creditor,
in violation of this Agreement, shall commence, prosecute or participate in any
suit, action or proceeding against Borrower or shall attempt to enforce,
foreclose or realize upon any security for the Subordinated Indebtedness,
Borrower or Lender may interpose as a defense or plea the making of this
Agreement and Lender may intervene and interpose such defense in its name or in
the name of Borrower, and Borrower or Lender may by virtue of this Agreement
restrain the enforcement thereof in the name of Borrower or Lender.


 


3.                                       Enforcement.  Subordinated Creditor, prior to the payment
in full of the Senior Indebtedness and the termination of all financing
arrangements under the Loan Agreement, shall not have any right to enforce
payment of any of the Subordinated Indebtedness or to otherwise take any action
against Borrower or its property without Senior Creditor’s prior written
consent.


 


4.                                       Subordinated Indebtedness Owed Only to
Subordinated Creditor. 
Subordinated Creditor warrants and represents to Senior Creditor that
Subordinated Creditor has not previously assigned any interest in the
Subordinated Indebtedness to any party, that no party owns an interest in the
Subordinated Indebtedness other than Subordinated Creditor (whether as joint
holder of the Subordinated Indebtedness, participants or otherwise), that the
entire Subordinated Indebtedness is owing to Subordinated Creditor, and
Subordinated Creditor covenants that the Subordinated Indebtedness shall
continue to be owing only to Subordinated Creditor, unless assigned,
transferred or disposed of in accordance with the terms of this Agreement as
provided in Section 10 hereof.


 


5.                                       Priority on Distribution.  In the event of any distribution, division or
application, partial or complete, voluntary or involuntary, by operation of law
or otherwise, of all or any part of the assets of Borrower or the proceeds
thereof to the creditors of Borrower or of any readjustment of the obligations
and indebtedness of Borrower, whether by reason of liquidation, bankruptcy,
arrangement, receivership, assignment for the benefit of creditors or any other
action or proceeding involving the readjustment of all or any of Borrower’s
indebtedness, or the application of the assets of Borrower to the payment or
liquidation thereof, or the dissolution or winding up of Borrower’s business,
or of the sale of all or substantially all of Borrower’s assets, then, and in
any such event, Senior Creditor shall be entitled to receive payment in full of
all Senior Indebtedness prior to the payment of all or any part of the
Subordinated Indebtedness.


 


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6.                                       Payments Received by Subordinated Creditor.  Should any payment or distribution be
received by Subordinated Creditor upon or with respect to the Subordinated
Indebtedness prior to the satisfaction of all Senior Indebtedness and the
termination of all financing arrangements between Borrower and Senior Creditor
under the Loan Agreement, Subordinated Creditor shall receive and hold the same
in trust, as trustee, for the benefit of Senior Creditor and shall forthwith
deliver the same to Senior Creditor in precisely the same form received (except
for the endorsement or assignment of Subordinated Creditor where necessary) for
application on the Senior Indebtedness, due or not due and to the extent
necessary to pay all Senior Indebtedness in full, and until so delivered, the
same shall be held in trust by Subordinated Creditor as the property of Senior
Creditor.


 


7.                                       Grant of Authority to Senior Creditor.  In order to enable Senior Creditor to enforce
its rights hereunder:  (a) Senior
Creditor is hereby irrevocably authorized and empowered, in its discretion, to
make and present for and on behalf of Subordinated Creditor such proofs of
claim against Borrower on account of the Subordinated Indebtedness as Senior
Creditor may deem expedient or proper, to vote such proofs of claim in any such
proceeding and to receive and collect any and all dividends or other payments
or disbursements made thereon in whatever form the same may be paid or issued
and to apply the same on account of any of the Senior Indebtedness; (b)
Subordinated Creditor irrevocably authorizes and empowers Senior Creditor to
demand, sue for, collect and receive every such payment or distribution and
give acquittance therefor and to file claims and to take such other actions, in
Senior Creditor’s own name or in the name of Subordinated Creditor or
otherwise, as Senior Creditor may deem necessary or advisable for the
enforcement of this Agreement; and (c) Subordinated Creditor shall execute and
deliver to Senior Creditor such powers of attorney, assignments or other
instruments or documents, as may be reasonably requested by Senior Creditor, in
order to enable Senior Creditor to enforce any and all claims upon or with
respect to any or all of the Subordinated Indebtedness and to collect and
receive any and all payments or distributions which may be payable or
deliverable at any time upon or with respect to the Subordinated Indebtedness,
all for Senior Creditor’s own benefit.


 


8.                                       Instrument Legend.  The Subordinated Loan, and any other
instruments evidencing any of the Subordinated Indebtedness, will, on the date
hereof or promptly hereafter, be inscribed with a legend conspicuously
indicating that payment thereof is subordinated to the claims of Senior
Creditor pursuant to the terms of this Agreement and a copy thereof will be
delivered to Senior Creditor promptly hereafter.


 


9.                                       Subrogation.  After all of the Senior Indebtedness has been
paid in full and until the Subordinated Indebtedness has been paid in full,
Subordinated Creditor shall be subrogated to the rights of Senior Creditor to
receive payments and distributions of assets with respect to the Senior
Indebtedness, to the extent that distributions otherwise payable to
Subordinated Creditor have been applied to the payment of Senior Indebtedness
in accordance with the provisions of this Agreement.  As between Borrower and Subordinated
Creditor, a distribution applied to the payment of the Senior Indebtedness in
accordance with the provisions of this Agreement which otherwise would have
been made to Subordinated Creditor shall not be deemed a payment by Borrower on
the Subordinated Indebtedness, it being understood that the subordination
provisions of this Agreement are and are intended solely for the purpose of
defining the relative


 


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rights of Subordinated
Creditor, on the one hand, and Senior Creditor, on the other hand, and nothing
contained in this Agreement shall impair the obligations of Borrower, which are
absolute and unconditional, to pay to Subordinated Creditor the Subordinated Indebtedness
as and when the same shall become due and payable in accordance with its terms,
except as such obligation is modified by the rights confirmed hereunder in
favor of Senior Creditor, or affect the relative rights of Subordinated
Creditor and the creditors of Borrower other than Senior Creditor.


 


10.                                 Assignment of Subordinated Indebtedness.  Subordinated Creditor agrees that until the
Senior Indebtedness has been paid in full and satisfied and all financing
arrangements between Borrower and Senior Creditor have been terminated in
writing, Subordinated Creditor will not assign, transfer or otherwise dispose
of the Subordinated Indebtedness or any portion thereof unless such assignment,
transfer or other disposition is made expressly subject to this Agreement.


 


11.                                 Term.  This Agreement shall constitute a continuing
agreement between Subordinated Creditor and Senior Creditor, and Senior
Creditor may continue, without notice to Subordinated Creditor, to lend monies,
extend credit and make other accommodations to or for the account of Borrower.
This Agreement shall be irrevocable by Subordinated Creditor until (i) all of
the Senior Indebtedness shall have been paid and fully satisfied and all
financing arrangements between Borrower and Senior Creditor have been
terminated in writing, or (ii) the Subordinated Indebtedness shall have been
paid and fully satisfied or (iii) the Closing (as defined in the Acquisition
Agreement dated December 15, 2004 between Senior Creditor, Borrower and NV
Partners III-BT LP), whichever first occurs.


 


12.                                 Additional Agreements Between Senior Creditor and
Borrower.  Senior
Creditor, at any time and from time to time, may enter into such agreement or
agreements with Borrower as Senior Creditor may deem proper, extending the time
of payment of or renewing or otherwise altering the terms of all or any of the
Senior Indebtedness or affecting the security underlying any or all of the
Senior Indebtedness, and may exchange, sell, release, surrender or otherwise
deal with any such security without in any way impairing or affecting this
Agreement.


 


13.                                 Waivers of Subordinated Creditor.  All of the Senior Indebtedness shall be
deemed to have been made or incurred in reliance upon this Agreement, and
Subordinated Creditor expressly waives all notice of the acceptance by Senior
Creditor of the subordination and other provisions of this Agreement, notice of
the incurring of Senior Indebtedness from time to time under the Loan Agreement
and all other notices not specifically required pursuant to the terms of this
Agreement or by law, and Subordinated Creditor expressly waives reliance by
Senior Creditor upon the subordination and other agreements as herein provided.


 


14.                                 Miscellaneous.


 


(a)                                  Amendments and Waivers.  Any term of this Agreement may be amended
with the written consent of the parties or their respective successors and
assigns.  Any amendment or waiver
effected in accordance with this Section 14(a) shall be binding upon the
parties and their respective successors and assigns.


 


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(b)                                 Successors and Assigns.   The terms and
conditions of this Agreement shall inure to the benefit of and be binding upon
the parties and their successors and assigns. 
Nothing in this Agreement, express or implied, is intended to confer
upon any party other than the parties hereto or their respective successors and
assigns any rights, remedies, obligations, or liabilities under or by
reason of this Agreement, except as expressly provided in this Agreement. The
term “Borrower” as used herein shall also refer to the successors and assigns
of Borrower, including, without limitation, a receiver, trustee, custodian or
debtor-in-possession.


 


(c)                                  Governing Law.  This Agreement and all acts and transactions
pursuant hereto and the rights and obligations of the parties hereto shall be
governed, construed and interpreted in accordance with the laws of the State of
California, without giving effect to principles of conflicts of law.


 


(d)                                 Counterparts.  This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original and all of which
together shall constitute one instrument.


 


(e)                                  Titles and Subtitles.  The titles and subtitles used in this
Agreement are used for convenience only and are not to be considered in
construing or interpreting this Agreement.


 


(f)                                    Notices.  Any notice required or permitted by this
Agreement shall be in writing and shall be deemed sufficient upon receipt, when
delivered personally or by a nationally-recognized delivery service (such as
Federal Express or UPS) or confirmed facsimile, or forty-eight (48) hours after
being deposited in the U.S. mail as certified or registered mail with postage
prepaid, if such notice is addressed to the party to be notified at such party’s
address or facsimile number as set forth
below or as subsequently modified by written notice.


 


(g)                                 Severability.  If one or more provisions of this Agreement
are held to be unenforceable under applicable law, the parties agree to
renegotiate such provision in good faith. 
In the event that the parties cannot reach a mutually agreeable and
enforceable replacement for such provision, then (i) such provision shall
be excluded from this Agreement, (ii) the balance of the Agreement shall
be interpreted as if such provision were so excluded and (iii) the balance
of the Agreement shall be enforceable in accordance with its terms.


 


(h)                                 Entire Agreement.  This Agreement and the documents referred to
herein are the product of both of the parties hereto, constitute the entire agreement between such parties pertaining to the
subject matter hereof and thereof, and merge all prior negotiations and drafts
of the parties with regard to the transactions contemplated herein and
therein.  Any and all other written or
oral agreements existing between the parties hereto regarding such transactions
are expressly canceled.


 


(i)                                     Advice of Legal Counsel.  Each party acknowledges and represents that,
in executing this Agreement, it has had the opportunity to seek advice as to
its legal rights from legal counsel and that the person signing on its behalf
has read and understood all of the terms


 


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and provisions of this
Agreement.  This Agreement shall not be
construed against any party by reason of the drafting or preparation thereof.


 


[Signature Page Follows]


 


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This Agreement has been duly executed under seal by
the parties hereto as of the day and year first above written.


 


 


	
   

  	
  SUBORDINATED CREDITOR:

  
	
   

  	
   

  
	
   

  	
  NV PARTNERS
  III-BT L.P.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Andrew
  Garman

  
	
   

  	
  Name:

  	
  Andrew Garman

  
	
   

  	
  (print)

  
	
   

  	
  Title: Managing Partner

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
  Facsimile Number:

  
	
   

  	
   

  
	
   

  	
  SENIOR CREDITOR:

  
	
   

  	
   

  
	
   

  	
  @ROAD, INC.

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Krish Panu

  
	
   

  	
   

  	
   

  
	
   

  	
  Name:

  	
  Krish Panu

  
	
   

  	
  (print)

  
	
   

  	
  Title: Chief
  Executive Officer

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
  Facsimile
  Number:

  
						



 


 


SIGNATURE PAGE TO SUBORDINATION
AGREEMENT


 





















 


ACKNOWLEDGMENT AND AGREEMENT


 


The undersigned, Vidus Limited, a company registered
in England and Wales under registered number 4069823 having its registered
office at North Felaw Maltings, 48 Felow Street, Ipswich, Suffolk IP2 8HE, the
Borrower named in the foregoing Subordination Agreement, does hereby accept,
and acknowledge receipt of a copy of, the foregoing Subordination Agreement, and
agrees that (a) it will not pay any of the Subordinated Indebtedness
except as the foregoing Agreement provides, and (b) it will be bound by
the subrogation provisions of Section 9 of the foregoing Agreement.  In the event of a breach by the undersigned
of any of the provisions herein, all of the Senior Indebtedness shall, without
presentment, demand, protest or notice of any kind except as otherwise required
by the Loan Agreement with Senior Creditor, become immediately due and payable
unless Senior Creditor shall otherwise elect in writing.


 


All capitalized terms used in this Acknowledgment and
Agreement without definition shall have the same meanings as set forth in the
foregoing Subordination Agreement.


 


The undersigned has caused this Acknowledgment and
Agreement to be duly executed as of the day and year first above written.


 


	
   

  	
  BORROWER:

  
	
   

  	
   

  
	
   

  	
  VIDUS LIMITED

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Martin
  Knestrick

  
	
   

  	
   

  
	
   

  	
  Name:

  	
  Martin Knestrick

  
	
   

  	
  (print)

  
	
   

  	
   

  
	
   

  	
  Title:

  	
  Director, CEO

  
	
   

  	
   

  
	
   

  	
  Address:

  
	
   

  	
   

  
	
   

  	
  Facsimile
  Number: