Document:

exv4w6

 

Exhibit 4.6

INTERCREDITOR AGREEMENT

INTERCREDITOR AGREEMENT, dated as of March 28, 2005, among WELLS FARGO FOOTHILL, INC., as Credit
Agent, U.S. BANK NATIONAL ASSOCIATION, as Trustee, and SMART MODULAR TECHNOLOGIES (WWH), INC., an
exempted company organized under the laws of the Cayman Islands (“Holdings”).

W I T N E S S E T H :

     WHEREAS, Holdings, the Companies (such term and each other capitalized term used
herein having the meanings set forth in Section 1 below), certain lenders and Wells Fargo Foothill,
Inc., as administrative agent and arranger, are parties to that certain Amended and Restated Loan
and Security Agreement, dated as of the date hereof (as further amended, restated, supplemented or
otherwise modified from time to time, the “Credit Agreement”), pursuant to which such lenders have
agreed to make loans and extend other financial accommodations to certain of the Companies and
that, among other things, permits, subject to certain terms and conditions, (a) the issuance of the
Notes by Holdings and the guarantee thereof by the Companies and (b) a second priority Lien on the
Common Collateral to secure the Noteholder Claims;

     WHEREAS, the Obligations of the Companies under the Loan Documents are secured (together with
certain other obligations) by various assets of the Companies;

     WHEREAS, Holdings, the Companies and the Trustee have entered into that certain Indenture
dated as of March 28, 2005 (as amended, restated, supplemented or otherwise modified from time to
time, the “Indenture”), pursuant to which Holdings intends to issue the Notes; and

     WHEREAS,
it is a condition precedent to the effectiveness of the Credit Agreement that the
parties hereto enter into this Agreement;

     NOW, THEREFORE, in consideration of the foregoing, the mutual covenants and obligations herein
set forth and for other good and valuable consideration, the sufficiency and receipt of which are
hereby acknowledged, the parties hereto, intending to be legally bound, hereby agree as follows:

SECTION 1. DEFINITIONS.

          (a) As used in this Agreement, the following terms have the meanings specified below:

     “Agreement” means this Agreement, as amended, restated, renewed, extended, supplemented or
otherwise modified from time to time in accordance with the terms hereof.

     “Bank Indebtedness” means any and all amounts payable under or in respect of the Credit
Facilities, including principal, premium (if any), interest (including interest
accruing on or after the filing of any petition in bankruptcy or for reorganization
relating to any Company whether or not a claim for post-filing interest is allowed in such
proceedings), fees, charges,

 

 

expenses, reimbursement obligations, guarantees and all other amounts payable thereunder or in
respect thereof.

     “Bankruptcy Law” means Title 11 of the United States Code and any similar Federal, state or
foreign law for the relief of debtors, as amended from time to time.

     “Business Day” means any day other than a Saturday, a Sunday or a day that is a legal holiday
under the laws of the State of New York or on which banking institutions in the State of New York are
required or authorized by law or other governmental action to close.

     “Cash Management Obligations” means, with respect to any Person, all obligations of such
Person in respect of overdrafts and other liabilities owed to any other Person that arise from
treasury, depositary, cash management or related services, including processing of electronic funds
through clearing houses, and credit card, credit card processing, debit card and purchase card
services.

     “Commodity Hedge Obligations” means, with respect to any Person, all obligations of such
Person in respect of any commodity price protection agreement or other commodity price hedging
arrangement or other similar agreement or arrangement.

     “Common Collateral” means all of the assets of any Grantor, whether real, personal or mixed,
constituting both Senior Lender Collateral and Noteholder Collateral.

     “Companies” means, collectively, the entities set forth on Schedule I hereto (each, a
“Company”).

     “Comparable
Noteholder Collateral Document” means, in relation to any Common Collateral
subject to any Lien created under any Senior Collateral Document, that Noteholder Collateral
Document which creates a Lien on the same Common Collateral, granted by the same Grantor.

     “Credit Agent” means Wells Fargo Foothill, Inc. in its capacity as administrative agent and
security trustee for the Senior Lenders under the Credit Agreement and the other Loan Documents (as
defined therein) and also includes its successors hereunder as administrative agent and security
trustee for the Senior Lenders (or if there is more than one administrative agent, a majority of
them) under the Senior Lender Documents exercising substantially the same rights and powers, or if
there is no acting Credit Agent under the Senior Credit Agreement, the Required Lenders.

     “Credit Agreement” has the meaning set forth in the recitals hereto.

     “Credit Facilities” means one or more debt facilities (including the Loan Documents) or
commercial paper facilities providing for revolving credit loans, term loans, receivables financing
(including through the sale of receivables to lenders or to special purpose entities formed to
borrow from lenders against such receivables) or letters of credit, or any debt securities or other
form of debt financing or financial accommodation (including convertible or exchangeable debt
instruments), in each case, as amended, supplemented, modified, extended, renewed, restated or
refunded in whole or in part from time to time.

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     “Currency Agreement” means with respect to any Person any foreign exchange
contract, currency swap agreements or other similar agreement or arrangement to which such Person is
a party.

     “Discharge of Senior Lender Claims” means, except to the extent otherwise provided
in Section 5.6, payment in full in cash of (a) the principal of and interest and premium,
if any, on all Indebtedness outstanding under the First-Lien Credit Facilities or, with respect to
Cash Management Obligations, Hedging Obligations, Commodity Hedge Obligation or letters of credit
outstanding thereunder, delivery of cash collateral or backstop letters of credit in respect
thereof in compliance with such First-Lien Credit Facilities, as applicable, in each case after or
concurrently with termination of all commitments to extend credit thereunder and (b) any other
Senior Lender Claims that are due and payable or otherwise accrued and owing at or prior to the
time such principal, interest and premium, if any, are paid.

     “First-Lien Credit Facilities” means (a) the Credit Facilities provided pursuant to the Loan
Documents and (b) any other Credit Facility, that, in the case
of both clauses (a) and (b), is
secured by a Permitted Lien (as defined in the Indenture) described
in clause (1) of the definition
thereof and (except for the Credit Facilities provided pursuant to the Credit Agreement) is
designated by Holdings as a “First-Lien Credit Facility”
for purposes of the Indenture.

     “Future Other First-Lien Obligations” means all obligations of each Company or any other
Grantor in respect of Cash Management Obligations or Hedging Obligations that are designated by
Holdings as “Credit Agreement Obligations” for purposes of the Indenture (other than any Senior
Lender Cash Management Obligations and Senior Lender Hedging Obligations).

     “Grantors” means each of Holdings, the Companies and any other Person that has executed and
delivered a Noteholder Collateral Document or a Senior Collateral Document.

     “Hedging Obligations” means, with respect to any Person, the obligations of such Person in
respect of (a) any Interest Rate Agreement, (b) Currency Agreement or (c) Commodity Hedge
Obligations.

     “Holdings” has the meaning set forth in the preamble hereto.

     “Indebtedness” means and includes all Obligations that constitute “Indebtedness” within the
meaning of the Indenture or the Senior Credit Agreement.

     “Indenture” has the meaning set forth in the recitals hereto.

     “Insolvency or Liquidation Proceeding” means (a) any voluntary or involuntary case or
proceeding under any Bankruptcy Law with respect to any Grantor, (b) any other voluntary
or involuntary insolvency, reorganization or bankruptcy case or proceeding, or any receivership,
liquidation, reorganization or other similar case or proceeding with respect to any Grantor or with
respect to any of their respective assets, (c) any liquidation, dissolution, reorganization or
winding up of any Grantor whether voluntary or involuntary and whether or not involving insolvency
or bankruptcy or (d) any assignment for the benefit of creditors
or any other marshalling of assets
and liabilities of any Grantor.

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     “Interest Rate Agreement” means with respect to any Person any interest rate protection
agreement, interest rate future agreement, interest rate option agreement, interest rate swap
agreement, interest rate cap agreement, interest rate collar agreement, interest rate hedge
agreement or other similar agreement or arrangement as to which such Person is party.

     “Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien, pledge,
hypothecation, encumbrance, charge or security interest in, on or of such asset, (b) the interest
of a vendor or a lessor under any conditional sale agreement, capital lease or title retention
agreement (or any financing lease having substantially the same economic effect as any of the
foregoing) relating to such asset and (c) in the case of securities, any purchase option, call or
similar right of a third party with respect to such securities.

     “Loan Documents” means the Credit Agreement and all other Loan Documents (as defined therein)
and any amendments, supplements, modifications, extensions, renewals, restatements or refundings
thereof and any indentures or credit facilities or commercial paper facilities or other agreement
or instrument evidencing or governing the terms of any indebtedness or other financial
accommodation that replace, refund or refinance any part of the loans, notes, other credit
facilities, commitments or other obligations thereunder (including any such replacement, refunding
or refinancing facility or indenture that increases the amount borrowable thereunder or alters the
maturity thereof), unless such agreement or instrument expressly provides that it is not intended
to be and is not a Loan Document hereunder.

     “Noteholder Claims” means all Obligations in respect of the Notes or arising under the
Noteholder Documents or any of them.

     “Noteholder
Collateral” means all of the assets of any Grantor, whether real,
personal or mixed, with respect to which a Lien is granted as security for any Noteholder
Claim.

     “Noteholder Collateral Documents” means the documents set forth in Schedule II and any other
document or instrument pursuant to which a Lien is granted by any Grantor to secure any Noteholder
Claims or under which rights or remedies with respect to any such Lien are governed.

     “Noteholder Documents” means (a) the Indenture, the Notes, the Note Guarantees, the Noteholder
Collateral Documents and any document or instrument evidencing or governing any Obligations with
respect to the Notes and any (b) other related document or instrument executed and delivered
pursuant to any Noteholder Document described in clause (a) above evidencing or governing any
Obligations thereunder.

     “Noteholder Mortgages” means a collective reference to each mortgage, deed of trust and any
other document or instrument under which any Lien on real property owned by any Grantor is granted
to secure any Noteholder Claims or under which rights or remedies with respect to any such Liens
are governed.

     “Noteholder Pledge Agreements” means the documents set forth on Schedule III.

     “Noteholder Security Agreement” means that certain Security Agreement, dated as of
March 28, 2005, among Holdings, the other Grantors party thereto and the Trustee.

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     “Noteholders” means the Persons holding Noteholder Claims.

     “Note Guarantee” means “Note Guarantee” as defined in the Indenture.

     “Notes” means (a) the Senior Secured Floating Rate Notes due 2012 to be issued by
Holdings, and (b) any additional notes issued under the Indenture by Holdings, to the extent
permitted by the Indenture and the Senior Credit Agreement.

     “Obligations” means any and all obligations with respect to the payment of (a) any principal
of or interest (including interest accruing on or after the commencement of any Insolvency or
Liquidation Proceeding, whether or not a claim for post-filing interest is allowed in such
proceeding) or premium on any Indebtedness, including any reimbursement obligation in respect of
any letter of credit, (b) any fees, indemnification obligations, expense reimbursement obligations
or other liabilities payable under the documentation governing any Indebtedness, (c) any obligation
to post cash collateral in respect of letters of credit and any other obligations or (d) any Cash
Management Obligations or Hedging Obligations.

     “Person” means any natural person, corporation, limited liability company, trust, joint
venture, association, company, partnership, entity or other party, including any
government and any political subdivision, agency or instrumentality thereof.

     “Pledged Collateral” means (a) the securities and other property pledged pursuant to the
Noteholder Pledge Agreements, and (b) any other Common Collateral in the possession of or under the
“control” (as defined in the Uniform Commercial Code) of the Credit Agent (or its agents or
bailees), to the extent that possession or control thereof is necessary to perfect a Lien thereon
under the Uniform Commercial Code.

     “Recovery”
has the meaning set forth in Section 6.5 hereof.

     “Required Lenders” means, with respect to any amendment or modification of the Senior Credit
Agreement, or any termination or waiver of any provision of the Senior Credit Agreement, or any
consent or departure by any Company or any of its Subsidiaries therefrom, those Senior Lenders the
approval of which is required to approve such amendment or modification, termination or waiver or
consent or departure.

     “Senior Collateral Documents” means the Loan Documents (as defined in the Senior Credit
Agreement) and any other agreement, document or instrument pursuant to which a Lien is granted
securing any Senior Lender Claims or under which rights or remedies with respect to such Liens are
governed.

     “Senior Credit Agreement” means the Credit Agreement; provided that if at any time a Discharge
of Senior Lender Claims occurs with respect to the Credit Agreement (without giving effect to
Section 5.6), then, to the extent provided in Section 5.6, the term “Senior Credit Agreement” means
the Future First-Lien Credit Facility designated by the Companies as the “Senior Credit Agreement”
in accordance with such Section.

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     “Senior Lender Cash Management Obligations” means any Cash Management Obligations secured by
any Common Collateral under the same Senior Collateral Documents that secure Obligations under the
Senior Credit Agreement.

     “Senior Lender Claims” means (a) all Bank Indebtedness and all other Indebtedness outstanding
under one or more of First-Lien Credit Facilities, the Indebtedness under each of which (i)
constitutes Permitted Debt (as defined in the Indenture) or is otherwise permitted by the Indenture
and (ii) is secured by a Permitted Lien (as defined in the Indenture) described in clause (1) of
the definition thereof, (b) all other obligations (not constituting Indebtedness) of each Company
or any Grantor under the Loan Documents or any such other First-Lien Credit Facility, (c) all
obligations of each Company or any Grantor in respect of Senior Lender Hedging Obligations and
Senior Lender Cash Management Obligations and (d) all Future Other First-Lien Obligations. Senior
Lender Claims shall include all interest accrued or accruing (or which would, absent the
commencement of an Insolvency or Liquidation Proceeding, accrue) after the commencement of an
Insolvency or Liquidation Proceeding in accordance with and at the rate specified in the relevant
Senior Lender Document whether or not the claim for such interest is allowed as a claim in such
Insolvency or Liquidation Proceeding. To
the extent any payment with respect to the Senior Lender Claims
(whether by or on behalf of any
Grantor, as proceeds of security, enforcement of any right of set-off or otherwise) is declared to
be fraudulent or preferential in any respect, set aside or required to be paid to a debtor in
possession, trustee, receiver or similar Person, then the obligation
or part thereof originally
intended to be satisfied shall be deemed to be reinstated and outstanding as if such payment had
not occurred. Notwithstanding anything to the contrary contained in
the first sentence of this
definition, any Obligation under the Senior Lender Documents (including any Cash Management
Obligations or Hedging Obligations) shall constitute a “Senior Lender Claim” if the Credit Agent or
the relevant Senior Lender or Senior Lenders shall have received a written representation from any
Company in or in connection with the Senior Lender Documents evidencing such Obligation that such
Obligation constitutes a “Credit Agreement Obligation” under and as defined in the Indenture
(whether or not such Obligation is at any time determined not to have been permitted to be incurred
under the Indenture).

     “Senior Lender Collateral” means all of the assets of any Grantor, whether real, personal or
mixed, whether now owned or hereafter acquired by such Grantor, with respect to which a Lien is
granted, or purported to be granted, as security for any Senior Lender Claim.

     “Senior Lender Documents” means the Senior Credit Agreement, the Senior Collateral Documents,
and each of the other agreements, documents and instruments providing for or evidencing any other
Obligation under the Loan Documents, any First-Lien Credit Facility, any Senior Lender Hedging
Obligation, any Senior Lender Cash Management Obligations or any Future Other First-Lien
Obligations, and any other related document or instrument executed or delivered pursuant to any
Senior Lender Document at any time or otherwise evidencing any Senior Lender Claims.

     “Senior Lender Hedging Obligations” means any Hedging Obligations secured by any Common
Collateral under the same Senior Collateral Documents that secure Obligations under the Senior
Credit Agreement.

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     “Senior Lenders” means the Persons holding Senior Lender Claims, including the Credit Agent.

     “Subsidiary” means any “Subsidiary” of Holdings or any Company, as defined in the
Indenture or the Senior Credit Agreement.

     “Trustee” means U.S. Bank National Association, in its capacity as trustee under the Indenture
and collateral agent under the Noteholder Collateral Documents, and also includes its successors
hereunder as collateral agent for the Noteholders under the Noteholder Collateral Documents.

     “Uniform Commercial Code” or “UCC” means the Uniform Commercial Code as from time to time in
effect in the State of New York.

          (b) Terms Generally. The definitions of terms herein shall apply equally to the singular and
plural forms of the terms defined. Whenever the context may require, any pronoun shall include the
corresponding masculine, feminine and neuter forms. The words “include”, “includes” and “including”
shall be deemed to be followed by the phrase “without limitation”. The word “will” shall be
construed to have the same meaning and effect as the word “shall”. Unless the context requires
otherwise (a) any definition of or reference to any agreement, instrument or other document herein
shall be construed as referring to such agreement, instrument or other document as from time to
time amended, restated, supplemented or otherwise modified, (b) any reference herein to any Person
shall be construed to include such Person’s successors and assigns, (c) the words “herein”,
“hereof’ and “hereunder”, and words of similar import, shall be construed to refer to this
Agreement in its entirety and not to any particular provision hereof, (d) all references herein to
Sections shall be construed to refer to Sections of this Agreement and (e) the words “asset” and
“property” shall be construed to have the same meaning and effect and to refer to any and all
tangible and intangible assets and properties, including cash, securities, accounts and contract
rights.

SECTION
2. LIEN PRIORITIES.

     2.1 Subordination. Notwithstanding the date, manner or order of grant, attachment or
perfection of any Liens granted to the Trustee or the Noteholders on the Common Collateral or of
any Liens granted to the Credit Agent or the Senior Lenders on the Common Collateral and
notwithstanding any provision of the UCC, or any applicable law or the Noteholder Documents or the
Senior Lender Documents or any other circumstance whatsoever, the
Trustee, on behalf of itself and
the Noteholders, hereby agrees that: (a) any Lien on the Common Collateral securing any Senior
Lender Claims now or hereafter held by or on behalf of the Credit Agent or any Senior Lenders or
any agent or trustee therefor shall be senior in all respects and prior to any Lien on the Common
Collateral securing any of the Noteholder Claims; and (b) any Lien on the Common Collateral now or
hereafter held by or on behalf of the Trustee or any Noteholders or any agent or trustee therefor
regardless of how acquired, whether by grant, statute, operation of law, subrogation or otherwise,
shall be junior and subordinate in all respects to all Liens on the Common Collateral securing any
Senior Lender Claims. All Liens on the Common Collateral securing any Senior Lender Claims shall be
and remain senior in all respects and prior to all Liens on the Common Collateral securing any
Noteholder Claims for all purposes, whether or

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not such Liens securing any Senior Lender Claims are subordinated to any Lien securing
any other obligation of any Company, any other Grantor or any other Person.

     2.2
Prohibition on Contesting Liens. Each of the
Trustee, for itself and on behalf of each
Noteholder, and the Credit Agent, for itself and on behalf of each Senior Lender, agrees that it
shall not (and hereby waives any right to) contest or support any other Person in contesting, in
any proceeding (including any Insolvency or Liquidation Proceeding), the priority, validity or
enforceability of a Lien held by or on behalf of any
of the Senior Lenders in the Senior Lender Collateral or by or on behalf of any of the
Noteholders in the Common Collateral, as the case may be;
provided that nothing in this Agreement
shall be construed to prevent or impair the rights of the Credit Agent or any Senior Lender to
enforce this Agreement, including the priority of the Liens securing the Senior Lender Claims as
provided in Section 2.1.

     2.3 No New Liens. So long as the Discharge of Senior Lender Claims has not occurred, the
parties hereto agree that, after the date hereof, if the Trustee shall hold any Lien on any assets
of any Company or any other Grantor securing any Noteholder Claims that are not also subject to the
first-priority Lien of the Credit Agent under the Senior Lender Documents (other than any assets
that the Credit Agent shall have released as security for the Senior Lender Claims), the Trustee,
upon demand by the Credit Agent or the Companies, will either (i) assign such Lien to the Credit
Agent as security for the Senior Lender Claims, in which event the Companies shall cause a junior
Lien on such assets to be granted to the Trustee or (ii) release such Lien.

SECTION 3. ENFORCEMENT.

     3.1 Exercise of Remedies.

          (a) So long as the Discharge of Senior Lender Claims has not occurred,
whether or not any Insolvency or Liquidation Proceeding has been commenced by or against any
Company or any other Grantor, (i) the Trustee and the Noteholders will not exercise or seek to
exercise any rights or remedies (including set-off) with respect to any Common Collateral,
institute any action or proceeding with respect to such rights or remedies (including any action of
foreclosure), contest, protest or object to any foreclosure proceeding or action brought by the
Credit Agent or any Senior Lender, the exercise of any right under
any lockbox agreement, control
agreement, landlord waiver or bailee’s letter or similar agreement or arrangement to which the
Trustee or any Noteholder is a party, or any other exercise by any such party, of any rights and
remedies relating to the Common Collateral under the Senior Lender Documents or otherwise, or
object to the forbearance by the Senior Lenders from bringing or pursuing any foreclosure
proceeding or action or any other exercise of any rights or remedies relating to the Common
Collateral and (ii) the Credit Agent and the Senior Lenders shall have the exclusive right to
enforce rights, exercise remedies (including set-off and the right to credit bid their debt) and
make determinations regarding the release, disposition, or restrictions with respect to the Common
Collateral without any consultation with or the consent of the
Trustee or any Noteholder; provided,
that (A) in any Insolvency or Liquidation Proceeding commenced by or against any Company or any
Grantor, the Trustee may file a claim or statement of interest with respect to the Noteholder
Claims, and (B) the Trustee may take any action (not adverse to the prior Liens on the Common
Collateral securing the Senior Lender Claims, or the rights of the

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Credit Agent or the Senior Lenders to exercise remedies in respect thereof) in order to
preserve or protect its Lien on the Common Collateral. In exercising rights and remedies
with respect to the Common Collateral, the Credit Agent and the Senior Lenders may enforce the
provisions of the Senior Lender Documents and exercise remedies thereunder, all in such order and
in such manner as they may determine in the exercise of their sole discretion. Such
exercise and enforcement shall include the rights of an agent appointed by them to sell or
otherwise dispose of Common Collateral upon foreclosure, to incur expenses in connection with such
sale or disposition, and to exercise all the rights and remedies of a secured lender under the
Uniform Commercial Code of any applicable jurisdiction and of a secured creditor under Bankruptcy
Laws of any applicable jurisdiction.

          (b) The
Trustee, on behalf of itself and the Noteholders, agrees that it will not take or
receive any Common Collateral or any proceeds of Common Collateral in connection with the exercise
of any right or remedy (including set-off) with respect to any Common Collateral, unless and until
the Discharge of Senior Lender Claims has occurred. Without limiting
the generality of the
foregoing, unless and until the Discharge of Senior Lender Claims has occurred, except as expressly
provided in the proviso in clause (ii) of Section 3.1(a) above, the sole right of the Trustee and
the Noteholders with respect to the Common Collateral is to hold a Lien on the Common Collateral
pursuant to the Noteholder Documents for the period and to the extent granted therein and to
receive a share of the proceeds thereof, if any, after the Discharge of the Senior Lender Claims
has occurred.

          (c) Subject to the proviso in clause (ii) of Section 3.1(a) above, (i) the Trustee, for itself
or on behalf of the Noteholders, agrees that the Trustee and the Noteholders will not take any
action that would hinder any exercise of remedies undertaken by the Credit Agent under the Senior
Loan Documents, including any sale, lease, exchange, transfer or other disposition of the Common
Collateral, whether by foreclosure or otherwise, and (ii) the Trustee, for itself and on
behalf of the Noteholders, hereby waives any and all rights it or the
Noteholders may have as a junior
lien creditor or otherwise to object to the manner in which the Credit Agent or the Senior Lenders
seek to enforce or collect the Senior Lender Claims or the Liens granted in any of the Senior
Lender Collateral, regardless of whether any action or failure to act by or on behalf of the Credit
Agent or Senior Lenders is adverse to the interest of the Noteholders.

          (d) The Trustee hereby acknowledges and agrees that no covenant, agreement or restriction
contained in any Noteholder Document shall be deemed to restrict in any way the rights and remedies
of the Credit Agent or the Senior Lenders with respect to the Common Collateral as set forth in
this Agreement and the Senior Lender Documents.

     3.2
Cooperation. Subject to the proviso in clause (ii) of Section 3.1(a) above, the Trustee,
on behalf of itself and the Noteholders, agrees that, unless and until the Discharge of Senior
Lender Claims has occurred, it will not commence, or join with any Person (other than the Senior
Lenders and the Credit Agent upon the request thereof) in commencing, any enforcement, collection,
execution, levy or foreclosure action or proceeding with respect to any Lien held by it under any
of the Noteholder Documents or otherwise.

SECTION
4. PAYMENTS.

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     4.1 Application of Proceeds. As long as the Discharge of Senior Lender Claims has
not occurred, the Common Collateral or proceeds thereof received in connection with the sale or
other disposition of, or collection on, such Common Collateral upon the exercise of
remedies, shall be applied by the Credit Agent to the Senior Lender Claims in such order as
specified in the relevant Senior Lender Documents until the Discharge of Senior Lender Claims has
occurred. Upon the Discharge of the Senior Lender Claims, the Credit Agent shall deliver to the
Trustee any proceeds of Common Collateral held by it in the same form as received, with any
necessary endorsements or as a court of competent jurisdiction may otherwise direct to be applied
by the Trustee to the Noteholder Claims in such order as specified in the relevant Noteholder
Documents.

     4.2 Payments Over. Any Common Collateral or proceeds thereof received by the Trustee
or any Noteholder in connection with the exercise of any right or remedy (including set-off)
relating to the Common Collateral in contravention of this Agreement shall be segregated and held
in trust and forthwith paid over to the Credit Agent for the benefit
of the Senior Lenders in the
same form as received, with any necessary endorsements or as a court of competent jurisdiction may
otherwise direct. The Credit Agent is hereby authorized to make any such endorsements as agent for
the Trustee or any such Noteholder. This authorization is coupled with an interest and is
irrevocable.

SECTION
5. OTHER AGREEMENTS.

     5.1
Releases.

          (a) If in connection with:

               (i) (x) the exercise of the Credit Agent’s remedies in respect of the
Common Collateral provided for in Section 3.1, including any sale, lease, exchange, transfer or
other disposition of any such Common Collateral or (y) upon the occurrence and during the
continuance of any event of default under the Loan Documents (whether or not any Insolvency or
Liquidation Proceeding has been commenced), any release, sale or other disposition of Common
Collateral; or

               (ii) any sale, lease, exchange, transfer or other disposition of any Common Collateral
permitted under the terms of the Senior Credit Agreement (whether or
not an event of default
thereunder, and as defined therein, has occurred and is continuing) and permitted or not prohibited
under the section of the Indenture entitled “Limitations of Sales of Assets and Subsidiary Stock”;

and in
each case the Credit Agent, for itself or on behalf of any of the Senior Lenders, releases any
of its Liens (or such Liens are, pursuant to the terms of the Senior Lender Documents, automatically
released) on any part of the Common Collateral (or any
Grantor from its obligations under its guaranty of the Senior Lender Claims), the Liens,
if any, of the Trustee, for itself or for the benefit of the Noteholders, on such Common Collateral
(and the obligations of such Grantor under its guaranty of the Noteholder Claims) shall be
automatically, unconditionally and simultaneously released and the Trustee, for itself or on
behalf of any such Noteholder, promptly shall execute and deliver to the Credit Agent or such
Grantor such

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termination statements, releases and other documents as the Credit Agent or such Grantor may
reasonably request to effectively confirm such release.

          (b) The Trustee, for itself and on behalf of the Noteholders, hereby irrevocably constitutes
and appoints the Credit Agent and any officer or agent of the Credit Agent, with full power of
substitution, as its true and lawful attorney-in-fact with full irrevocable power and authority in
the place and stead of the Trustee or such holder or in the Credit Agent’s own name, from time to
time in the Credit Agent’s discretion, for the purpose of carrying out the terms of this Section 5.1,
to take any and all appropriate action and to execute any and all documents and instruments
which may be necessary or desirable to accomplish the purposes of this Section 5.1, including any
termination statements, endorsements or other instruments of transfer or release.

     5.2 Insurance. Unless and until the Discharge of Senior Lender Claims has occurred, the Credit
Agent and the Senior Lenders shall have the sole and exclusive right,
subject to the rights of the
Grantors under the Senior Lender Documents, to adjust settlement for any insurance policy covering
the Common Collateral in the event of any loss thereunder and to approve any award granted in any
condemnation or similar proceeding affecting the Common Collateral. Unless and until the Discharge
of Senior Lender Claims has occurred, all proceeds of any such policy and any such award if in
respect to the Common Collateral shall be paid to the Credit Agent for the benefit of the Senior
Lenders to the extent required under the Senior Lender Documents and thereafter to the Trustee for
the benefit of the Noteholders to the extent required under the applicable Noteholder Documents and
then to the owner of the subject property or as a court of competent jurisdiction may otherwise
direct. If the Trustee or any Noteholder shall, at any time, receive any proceeds of any such
insurance policy or any such award in contravention of this Agreement, it shall pay such proceeds
over to the Credit Agent in accordance with the terms of Section 4.2.

     5.3 Amendments to Noteholder Collateral Documents.

          (a) Unless and until the Discharge of Senior Lender claims has occurred,
without the prior written consent of the Credit Agent and the Required Lenders, no Noteholder
Collateral Document may be amended, supplemented or otherwise modified or entered into to the
extent such amendment, supplement or modification, or the terms of any new Noteholder Collateral
Document, would be prohibited by or inconsistent with any of the
terms of the Senior Lender
Documents. The Trustee agrees that each Noteholder Collateral Document shall include the following
language (or language to similar effect
approved by the Credit Agent):

“Notwithstanding anything herein to the contrary, the lien and security interest granted to the
Trustee pursuant to this Agreement and the exercise of any right or remedy by the Trustee hereunder
are subject to the provisions of the Intercreditor Agreement, dated as of March 28, 2005 (as
amended, supplemented or otherwise modified from time to time, the
“Intercreditor Agreement”),
among Smart Modular Technologies (WWH), Inc., Wells Fargo Foothill, Inc., as Credit Agent, and U.S.
Bank National Association, as Trustee. In the event of any conflict between the

-11-

 

terms
of the Intercreditor Agreement and this Agreement, the terms of the Intercreditor Agreement
shall govern.”

     In addition, the Trustee agrees that each Noteholder Mortgage covering any Common Collateral
shall contain such other language as the Credit Agent may reasonably request to reflect the
subordination of such Noteholder Mortgage to the Senior Collateral Document covering such Common
Collateral.

          (b) In the event the Credit Agent or the Senior Lenders enter into any amendment, waiver or
consent in respect of any of the Senior Collateral Documents for the purpose of adding to, or
deleting from, or waiving or consenting to any departures from any provisions of, any Senior
Collateral Document or changing in any manner the rights of the Credit Agent, the Senior Lenders,
any Company or any other Grantor thereunder, then such amendment, waiver or consent shall apply
automatically to any comparable provision of the Indenture and the Comparable Noteholder Collateral
Document without the consent of the Trustee or the Noteholders and without any action by the
Trustee, any Company or any other Grantor, provided, that (A) no such amendment, waiver or consent
shall have the effect of removing assets subject to the Lien of the Noteholder Collateral Documents,
except to the extent that a release of such Lien is permitted by Section 5.1, (B) notice of such
amendment, waiver or consent shall have been given to the Trustee and (C) no such amendment, waiver
or consent shall materially and adversely affect the Noteholders without the consent of the Trustee
(acting at the direction of the Noteholders holding a majority of the aggregate principal amount
of the Notes).

     5.4 Rights As Unsecured Creditors. Notwithstanding anything to the contrary in this Agreement,
the Trustee and the Noteholders may exercise rights and remedies as an unsecured creditor against
any Company or any Subsidiary that has guaranteed the Noteholder Claims in accordance with the
terms of the Noteholder Documents and applicable law. Nothing in this Agreement shall prohibit the
receipt by the Trustee or any Noteholders of the required payments of interest and principal so long
as such receipt is not the direct or indirect result of the exercise by the Trustee or any
Noteholder of rights or remedies as a secured creditor or enforcement in contravention of this
Agreement of any Lien held by any of them. In the event the Trustee
or any Noteholder becomes a
judgment lien creditor in respect of Common Collateral as a result
of its enforcement of its rights as an unsecured creditor, such judgment lien shall be
subordinated to the Liens securing Senior Lender Claims on the same basis as the other Liens
securing the Noteholder Claims are so subordinated to such Senior Lender Claims under this
Agreement. Nothing in this Agreement impairs or otherwise adversely affects any rights or remedies
the Credit Agent or the Senior Lenders may have with respect to the Senior Lender Collateral.

     5.5 Bailee for Perfection.

          (a) Until the Discharge of Senior Lender Claims has occurred, Credit Agent
agrees to hold the Pledged Collateral that is part of the Common Collateral in its possession or
control (or in the possession or control of its agents or bailees) as agent and bailee for the
Trustee and any assignee solely for the purpose of perfecting the security interest granted in such
Pledged Collateral pursuant to the Noteholder Collateral Documents, subject to the terms and
conditions of this Section 5.5.

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          (b) Until the Discharge of Senior Lender Claims has occurred, the Credit Agent shall be
entitled to deal with the Pledged Collateral in accordance with the terms of the Senior Lender
Documents as if the Liens of the Trustee under the Noteholder Collateral Documents did not exist.
Until the Discharge of Senior Lender Claims has occurred, the rights of the Trustee shall at all
times be subject to the terms of this Agreement and to the Credit Agent’s rights under the Senior
Lender Documents.

          (c) The Credit Agent shall have no obligation whatsoever to the Trustee or any Noteholder to
assure that the Pledged Collateral is genuine or owned by any of the Grantors or to preserve rights
or benefits of any Person except as expressly set forth in this Section 5.5. The duties or
responsibilities of the Credit Agent under this Section 5.5 shall be limited solely to holding the
Pledged Collateral as agent and bailee for the Trustee for purposes of perfecting the Lien held by
the Trustee.

          (d) The Credit Agent shall not have by reason of the Noteholder Collateral Documents or this
Agreement or any other document a fiduciary relationship in respect of the Trustee or any
Noteholder.

          (e) Upon the Discharge of Senior Lender Claims, the Credit Agent shall deliver to the Trustee
the remaining Pledged Collateral (if any) together with any necessary endorsements (or otherwise
allow the Trustee to obtain control of such Pledged Collateral) or as
a court of competent
jurisdiction may otherwise direct.

     5.6 When Discharge of Senior Lender Claims Deemed to Not Have Occurred. If at any time after
the Discharge of Senior Lender Claims has occurred the Companies designate any First-Lien Credit
Facility to be the “Senior Credit Agreement” hereunder, then such Discharge of Senior Lender Claims
shall automatically be deemed not to have occurred for all purposes
of this Agreement (other than
with respect to any actions taken prior to the date of such designation as a result of
the occurrence of such first Discharge of Senior Lender Claims), and such First-Lien Credit
Facility shall automatically be treated as the Senior Credit Agreement for all purposes of this
Agreement, including for purposes of the Lien priorities and rights
in respect of Common Collateral
set forth herein. Upon receipt of notice of such designation (including the identity of the new
Credit Agent), the Trustee shall promptly (i) enter into such documents and agreements (including
amendments or supplements to this Agreement) as the Companies or such new Credit Agent shall
reasonably request in order to provide to the new Credit Agent the rights of the Credit Agent
contemplated hereby and (ii) deliver to the new Credit Agent the Pledged Collateral together with
any necessary endorsements (or otherwise allow such Credit Agent to obtain control of such Pledged
Collateral).

SECTION 6. INSOLVENCY OR LIQUIDATION PROCEEDINGS.

     6.1 Financing Issues. If any Company or any other Grantor shall be subject to any Insolvency
or Liquidation Proceeding and the Credit Agent or the Senior Lenders shall desire to permit the use
of cash collateral or to permit any Company or any other Grantor to obtain financing under Section
363 or Section 364 of Title 11 of the United States Code or any similar Bankruptcy Law (“DIP
Financing”), then the Trustee, on behalf of itself and the Noteholders, agrees that it will raise
no objection to such use of cash collateral or DIP Financing and will not

-13-

 

request adequate protection or any other relief in connection therewith (except to the extent
permitted by Section 6.3) and, to the extent the Liens securing the Senior Lender Claims
are subordinated or pari passu with such DIP Financing, will subordinate its Liens in the Common
Collateral to such DIP Financing and such Senior Lender Claims (and all Obligations relating
thereto) on the same basis as the other Liens securing the Noteholder Claims are so subordinated to
Senior Lender Claims under this Agreement.

     6.2 Relief from the Automatic Stay. Until the Discharge of Senior Lender Claims has occurred,
the Trustee, on behalf of itself and the Noteholders, agrees that none of them shall seek relief
from the automatic stay or any other stay in any Insolvency or Liquidation Proceeding in respect of
the Common Collateral, without the prior written consent of the Credit Agent and the Required
Lenders.

     6.3 Adequate Protection. The Trustee, on behalf of itself and the Noteholders, agrees that
none of them shall contest (or support any other Person contesting) (a) any request by the Credit
Agent or the Senior Lenders for adequate protection or (b) any objection by the Credit Agent or the
Senior Lenders to any motion, relief, action or proceeding based on the Credit Agent or the Senior
Lenders claiming a lack of adequate protection. Notwithstanding the foregoing contained in this
Section 6.3, in any Insolvency or Liquidation Proceeding, (i) if the Senior Lenders (or any subset
thereof) are granted adequate protection in the form of additional collateral in connection with
any DIP Financing or use of cash collateral under Section 363 or Section 364 of Title 11
of the United States Code or any similar Bankruptcy Law, then the Trustee, on
behalf of itself or any of the Noteholders, may seek or request adequate protection in the form
of a replacement Lien on such additional collateral, which Lien is subordinated to the Liens
securing the Senior Lender Claims and such DIP Financing (and all Obligations relating thereto) on
the same basis as the other Liens securing the Noteholder Claims are so subordinated to the Senior
Lender Claims under this Agreement, and (ii) in the event the Trustee, on behalf of itself or any
of the Noteholders, seeks or requests adequate protection and such adequate protection is granted
in the form of additional collateral, then the Trustee, on behalf of itself or any of the
Noteholders, agrees that the Credit Agent and the Senior Lenders shall also be granted a senior
Lien on such additional collateral as security for the Senior Lender Claims and any such DIP
Financing and that any Lien on such additional collateral securing the Noteholder Claims shall be
subordinated to the Liens on such collateral securing the Senior Lender Claims and any such DIP
Financing (and all Obligations relating thereto) and any other Liens granted to the Senior Lenders
as adequate protection on the same basis as the other Liens securing the Noteholder Claims are so
subordinated to such Senior Lender Claims under this Agreement.

     6.4 No Waiver. Nothing contained herein shall prohibit or in any way limit the Credit Agent or
any Senior Lender from objecting in any Insolvency or Liquidation Proceeding or otherwise to any
action taken by the Trustee or any of the Noteholders, including the seeking by the Trustee or any
Noteholder of adequate protection or the asserting by the Trustee or
any Noteholder of any of its
rights and remedies under the Noteholder Documents or otherwise.

     6.5 Preference Issues. If any Senior Lender is required in any Insolvency or Liquidation
Proceeding or otherwise to turn over or otherwise pay to the estate of any Company or any other
Grantor any amount (a “Recovery”), then the Senior Lender Claims shall be reinstated to the extent
of such Recovery and the Senior Lenders shall be entitled to a Discharge

-14-

 

of Senior Lender Claims with respect to all such recovered amounts. If this Agreement
shall have been terminated prior to such Recovery, this Agreement shall be reinstated in full force
and effect, and such prior termination shall not diminish, release, discharge, impair or otherwise
affect the obligations of the parties hereto from such date of reinstatement.

SECTION 7. RELIANCE; WAIVERS; ETC.

     7.1
Reliance. The consent by the Senior Lenders to the execution and delivery of the Noteholder
Documents and the grant to the Trustee on behalf of the Noteholders of a Lien on the Common Collateral
and all loans and other extensions of credit made or deemed made on
and after the date hereof by the
Senior Lenders to any Company shall be deemed to have been given and made in reliance upon this
Agreement. The Trustee, on behalf of itself and the Noteholders, acknowledges that it and the
Noteholders have, independently and without reliance on the Credit Agent or any Senior
Lender, and based on documents and information deemed by them appropriate, made their own
credit analysis and decision to enter into the Indenture, this Agreement and the transactions
contemplated hereby and thereby and they will continue to make their own credit decision in taking
or not taking any action under the Indenture or this Agreement.

     7.2 No Warranties or Liability. The Trustee, on behalf of itself and the Noteholders,
acknowledges and agrees that each of the Credit Agent and the Senior Lenders have made no express
or implied representation or warranty, including with respect to the execution, validity, legality,
completeness, collectibility or enforceability of any of the Senior Lender Documents, the ownership
of any Common Collateral or the perfection or priority of any Liens thereon. The Senior Lenders
will be entitled to manage and supervise their respective loans and
extensions of credit under the
Senior Lender Documents in accordance with law and as they may otherwise, in their sole discretion,
deem appropriate, and the Senior Lenders may manage their loans and extensions of credit without
regard to any rights or interests that the Trustee or any of the Noteholders have in the Common
Collateral or otherwise, except as otherwise provided in this Agreement. Neither the Credit Agent
nor any Senior Lender shall have any duty to the Trustee or any of the Noteholders to act or
refrain from acting in a manner which allows, or results in, the occurrence or continuance of an
event of default or default under any agreements with any Company or any Subsidiary thereof
(including the Noteholder Documents), regardless of any knowledge
thereof which they may have or be
charged with.

     7.3 No Waiver of Lien Priorities.

          (a)
No right of the Senior Lenders, the Credit Agent or any of them to enforce
any provision of this Agreement or any Senior Lender Document shall at any time in any way be
prejudiced or impaired by any act or failure to act on the part of any Company or any other Grantor
or by any act or failure to act by any Senior Lender or the Credit Agent, or by any noncompliance
by any Person with the terms, provisions and covenants of this Agreement, any of the Senior Lender
Documents or any of the Noteholder Documents, regardless of any
knowledge thereof which the Credit
Agent or the Senior Lenders, or any of them, may have or be otherwise charged with;

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          (b) Without in any way limiting the generality of the foregoing paragraph (but subject to the
rights of the Companies and the other Grantors under the Senior Lender Documents), the Senior
Lenders, the Credit Agent and any of them, may, at any time and from time to time,
without the consent of, or notice to, the Trustee or any Noteholder, without incurring any
liabilities to the Trustee or any Noteholder and without impairing or releasing the Lien priorities
and other benefits provided in this Agreement (even if any right of subrogation or other right or
remedy of the Trustee or any Noteholder is affected, impaired or extinguished thereby) do any one
or more of the following, provided no release of any Lien granted to the Trustee or the Noteholders
on the Common Collateral shall result therefrom except to the extent expressly permitted
under this Agreement:

               (i) change
the manner, place or terms of payment or change or extend the time of
payment of, or amend, renew, exchange, increase or alter, the terms of any of the Senior Lender
Claims or any Lien on any Senior Lender Collateral or guaranty thereof or any liability of any
Company or any other Grantor, or any liability incurred directly or indirectly in respect thereof
(including any increase in or extension of the Senior Lender Claims, without any restriction as to
the amount, tenor or terms of any such increase or extension) or otherwise amend, renew, exchange,
extend, modify or supplement in any manner any Liens held by the Credit Agent or any of the Senior
Lenders, the Senior Lender Claims or any of the Senior Lender Documents;

               (ii) sell, exchange, release, surrender, realize upon, enforce or otherwise deal with in any
manner and in any order any part of the Senior Lender Collateral or any liability of any Company or
any other Grantor to the Senior Lenders or the Credit Agent, or any liability incurred directly or
indirectly in respect thereof;

               (iii) settle or compromise any Senior Lender Claim or any other liability of any Company or
any other Grantor or any security therefor or any liability incurred directly or indirectly in
respect thereof and apply any sums by whomsoever paid and however realized to any liability
(including the Senior Lender Claims) in any manner or order; and

               (iv) exercise or delay in or refrain from exercising any right or remedy against any Company
or any security or any other Grantor or any other Person, elect any remedy and otherwise deal
freely with any Company, any other Grantor or any Senior Lender Collateral and any security and any
guarantor or any liability of any Company or any other Grantor to the Senior Lenders or any
liability incurred directly or indirectly in respect thereof.

          (c) The Trustee, on behalf of itself and the Noteholders, also agrees that the Senior Lenders
and the Credit Agent shall have no liability to the Trustee or any Noteholder, and the Trustee, on
behalf of itself and the Noteholders, hereby waives any claim against any Senior Lender or the
Credit Agent, arising out of any and all actions which the Senior Lenders or the Credit Agent may
take or permit or omit to take with respect to: (i) the Senior Lender Documents, (ii) the
collection of the Senior Lender Claims or (iii) the foreclosure upon, or sale, liquidation or other
disposition of, any Senior Lender Collateral. The Trustee, on behalf
of itself and the Noteholders,
agrees that the Senior Lenders and the Credit Agent have no duty to them in respect of the
maintenance or preservation of the Senior Lender Collateral, the Senior Lender Claims or otherwise;
and

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          (d) The Trustee, on behalf of itself and the Noteholders, agrees not to assert and
hereby waives, to the fullest extent permitted by law, any right to demand, request, plead or
otherwise assert or otherwise claim the benefit of, any marshalling, appraisal, valuation or other
similar right that may otherwise be available under applicable law or any other
similar rights a junior secured creditor may have under applicable law.

     7.4 Obligations Unconditional. All rights, interests, agreements and obligations of the Credit
Agent and the Senior Lenders and the Trustee and the Noteholders, respectively, hereunder shall
remain in full force and effect irrespective of:

          (a)
any lack of validity or enforceability of any Senior Lender Documents or any Noteholder
Documents;

          (b) any change in the time, manner or place of payment of, or in any other terms of, all or
any of the Senior Lender Claims or Noteholder Claims, or any amendment or waiver or other
modification, including any increase in the amount thereof, whether by course of conduct or
otherwise, of the terms of the Senior Credit Agreement or any other Senior Lender Document or of
the terms of the Indenture or any other Noteholder Document;

          (c) any exchange of any security interest in any Common Collateral or any other collateral, or
any amendment, waiver or other modification, whether in writing or by course of conduct or
otherwise, of all or any of the Senior Lender Claims or Noteholder
Claims or any guarantee thereof;

          (d)
the commencement of any Insolvency or Liquidation Proceeding in respect of any Company or
any other Grantor; or

          (e) any other circumstances which otherwise might constitute a defense available to, or a
discharge of, any Company or any other Grantor in respect of the Senior Lender Claims, or of the
Trustee or any Noteholder in respect of this Agreement.

SECTION 8. MISCELLANEOUS.

     8.1 Conflicts. In the event of any conflict between the provisions of this Agreement and the
provisions of the Senior Lender Documents or the Noteholder
Documents, the provisions of this
Agreement shall govern.

     8.2 Continuing Nature of this Agreement; Severability. This Agreement shall continue to be
effective until the Discharge of Senior Lender Claims shall have occurred. This is a continuing
agreement of lien subordination and the Senior Lenders may continue, at any time and without notice
to the Trustee or any Noteholder, to extend credit and other financial accommodations and lend
monies to or for the benefit of any Company or any Grantor constituting Senior Lender Claims on
reliance hereof. The Trustee, on behalf of itself and the Noteholders, hereby waives any right it
may have under applicable law to revoke this Agreement or any of the provisions of this Agreement.
The terms of this Agreement shall survive, and shall continue in full force and effect, in any
Insolvency or Liquidation Proceeding. Any provision of this Agreement which is prohibited or
unenforceable in any jurisdiction shall not invalidate the

-17-

 

remaining provisions hereof, and any such prohibition or unenforceability in any jurisdiction shall
not invalidate or render unenforceable such provision in any other jurisdiction.

     8.3 Amendments; Waivers. No amendment, modification or waiver of any of the
provisions of this Agreement by the Trustee or the Credit Agent shall be deemed to be made unless
the same shall be in writing signed on behalf of the party making the same or its authorized agent
and each waiver, if any, shall be a waiver only with respect to the specific instance involved and
shall in no way impair the rights of the parties making such waiver or the obligations of the other
parties to such party in any other respect or at any other time. The Companies, Holdings and the
other Grantors shall not have any right to consent to or approve any amendment, modification or
waiver of any provision of this Agreement except to the extent their rights are directly affected.

     8.4 Information Concerning Financial Condition of the Companies and the Subsidiaries. The
Credit Agent and the Senior Lenders, on the one hand, and the Trustee and the Noteholders, on the
other hand, shall each be responsible for keeping themselves informed of (a) the financial
condition of the Companies and the Subsidiaries and all endorsers and/or guarantors of the
Noteholder Claims or the Senior Lender Claims and (b) all other circumstances bearing upon the risk
of nonpayment of the Noteholder Claims or the Senior Lender Claims. The Credit Agent and the Senior
Lenders shall have no duty to advise the Trustee or any Noteholder of information known to it or
them regarding such condition or any such circumstances or otherwise. In the event the Credit Agent
or any of the Senior Lenders, in its or their sole discretion, undertakes at any time or from time
to time to provide any such information to the Trustee or any Noteholder, it or they shall be under
no obligation (w) to make, and the Credit Agent and the Senior Lenders shall not make, any express
or implied representation or warranty, including with respect to the accuracy, completeness,
truthfulness or validity of any such information so provided, (x) to provide any additional
information or to provide any such information on any subsequent occasion, (y) to undertake any
investigation or (z) to disclose any information which, pursuant to accepted or reasonable
commercial finance practices, such party wishes to maintain confidential or is otherwise required
to maintain confidential.

     8.5
Subrogation. The Trustee, on behalf of itself and the Noteholders, hereby waives any rights
of subrogation it may acquire as a result of any payment hereunder until the Discharge of Senior
Lender Claims has occurred.

     8.6 Application of Payments. All payments received by the Senior Lenders may be applied,
reversed and reapplied, in whole or in part, to such part of the Senior Lender Claims as the Senior
Lenders, in their sole discretion, deem appropriate. The Trustee, on behalf of itself and the
Noteholders, assents to any extension or postponement of the time of payment of the Senior Lender
Claims or any part thereof and to any other indulgence with respect thereto, to any substitution,
exchange or release of any security which may at any time secure any part of the Senior Lender
Claims and to the addition or
release of any other Person primarily or secondarily liable therefor.

     8.7 Consent to Jurisdiction; Waivers. The parties hereto consent to the jurisdiction of any
state or federal court located in New York, New York, and consent that all service of process may
be made by registered mail directed to such party as provided in Section 8.8 below

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for such party. Service so made shall be deemed to be completed three days after the same
shall be posted as aforesaid. The parties hereto waive any objection to any action instituted
hereunder based on forum non conveniens, and any objection to the venue of any action instituted
hereunder. Each of the parties hereto waives any right it may have to trial by jury in respect of
any litigation based on, or arising out of, under or in connection with this Agreement or any
other Loan Document, or any course of conduct, course of dealing, verbal or written statement
or action of any party hereto.

     8.8 Notices. All notices to the Noteholders and the Senior Lenders permitted or required under
this Agreement may be sent to the Trustee and the Credit Agent, respectively. Unless otherwise
specifically provided herein, any notice or other communication herein required or permitted to be
given shall be in writing and may be personally served, telecopied, electronically mailed or sent
by courier service or U.S. mail and shall be deemed to have been given when delivered in person or
by courier service, upon receipt of a telecopy or electronic mail or four Business Days after
deposit in the U.S. mail (registered or certified, with postage prepaid and properly addressed).
For the purposes hereof, the addresses of the parties hereto shall be as set forth below each
party’s name on the signature pages hereto, or, as to each party, at such other address as may be
designated by such party in a written notice to all of the other parties.

     8.9
Further Assurances. The Trustee, on behalf
of itself and the Noteholders, agrees that it
shall take such further action and shall execute and deliver to the Credit Agent and the Senior
Lenders such additional documents and instruments (in recordable form, if requested) as the Credit
Agent or the Senior Lenders may reasonably request to effectuate the terms of and the lien
priorities contemplated by this Agreement.

     8.10 Governing Law. This Agreement has been delivered and accepted at and shall be deemed to
have been made at New York, New York and shall be interpreted, and
the rights and liabilities of the
parties bound hereby determined, in accordance with the laws of the State of New York.

     8.11 Binding on Successors and Assigns. This Agreement shall be binding upon the Credit Agent,
the Senior Lenders, the Trustee, the Noteholders, Holdings, the
Companies and their respective
permitted successors and assigns.

     8.12 Specific Performance. The Credit Agent may demand specific performance of this Agreement.
The Trustee, on behalf of itself and the Noteholders, hereby irrevocably waives any defense based on
the adequacy of a remedy at law and any other defense which might be asserted to bar the remedy of
specific performance in any action
which may be brought by the Credit Agent.

     8.13 Section Titles. The section titles contained in this Agreement are and shall be without
substantive meaning or content of any kind whatsoever and are not a part of this Agreement.

-19-

 

     8.14 Counterparts. For purposes of U.S. law only, this Agreement may be executed in one or
more counterparts, each of which shall be an original and all of which shall together constitute
one and the same document.

     8.15 Authorization. By its signature, each Person executing this Agreement on behalf of a
party hereto represents and warrants to the other parties hereto that it is duly authorized to
execute this Agreement.

     8.16 No Third Party Beneficiaries. This Agreement and the rights and benefits hereof shall
inure to the benefit of each of the parties hereto and their respective successors and assigns and
shall inure to the benefit of each of the holders of Senior Lender Claims and Noteholder Claims. No
other Person shall have or be entitled to assert rights or benefits hereunder.

     8.17 Effectiveness. This Agreement shall become effective when executed and delivered by the
parties hereto. This Agreement shall be effective both before and after the commencement of any
Insolvency or Liquidation Proceeding. All references to Holdings, the Companies or any other
Grantor shall include Holdings, any Company or Grantor as debtor and debtor-in-possession and any
receiver or trustee for any Company or any other Grantor (as the case may be) in any Insolvency or
Liquidation Proceeding.

     8.18 Credit Agent and Trustee. It is understood and agreed that (a) Wells Fargo Foothill, Inc.
is entering into this Agreement in its capacity as Credit Agent and the provisions of Article 16 of
the Credit Agreement applicable to Wells Fargo Foothill, Inc. as administrative agent thereunder
shall also apply to Wells Fargo Foothill, Inc. as Credit Agent hereunder, and (b) U.S. Bank
National Association is entering in this Agreement in its capacity as Trustee and the provisions of
Article 7 of the Indenture applicable to the Trustee thereunder shall also apply to the Trustee
hereunder.

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     8.19 Designations. For purposes of the provisions hereof and the Indenture requiring the
Companies to designate Indebtedness for the purposes of the term “Credit Agreement
Obligations” under the Indenture, “First-Lien Credit Facilities” or any other designations for
any other purposes hereunder or under the Indenture, any such designation shall be sufficient
if the relevant designation is set forth in writing, signed on behalf of the Companies by an
officer thereof and delivered to the Trustee and the Credit Agent. For all purposes hereof and the
Indenture, the Companies hereby designate the Credit Facilities provided pursuant to the Credit
Agreement as the First-Lien Credit Facility and any Obligations in respect of the Credit Agreement
as “Credit Agreement
Obligations” under the Indenture.

     IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first
written above.

	 	 	 
	 

	 	Credit Agent:
	 
	 	 
	 

	 	WELLS FARGO FOOTHILL, INC.,
	 

	 	as Credit Agent
	 
	 	 
	 

	 	/s/ Trent A. Smart
	 

	 	 
	 

	 	Name: TRENT A. SMART
	 

	 	Title: VICE PRESIDENT
	 
	 	 
	 

	 	Address:
	 
	 	 
	 

	 	2450 Colorado Avenue
	 

	 	Suite 3000 West
	 

	 	Santa Monica, California 90404
	 

	 	Attention: Business Finance Division Manager
	 

	 	Telecopy No.: (310) 453-7413

INTERCREDITOR AGREEMENT

 

 

	 	 	 
	 

	 	Trustee:
	 
	 	 
	 

	 	U.S. BANK NATIONAL ASSOCIATION,
	 

	 	as Trustee
	 	 	 
	 

	 	/s/ Richard Prokosch
	 

	 	 
	 

	 	Name: Richard Prokosch
	 

	 	Title: Vice President
	 
	 	 
	 

	 	Address:
	 
	 	 
	 

	 	60 Livingston Avenue
	 

	 	St. Paul. MN 55107
	 

	 	Attention: Corporate Trust Administration
	 

	 	Telecopy No.: (651) 495-8097

INTERCREDITOR AGREEMENT

 

 

	 	 	 
	 

	 	  Holdings:
	 
	 	 
	 

	 	  EXECUTED AS A DEED BY:
	 
	 	 
	 

	 	  SMART MODULAR TECHNOLOGIES
	 

	 	  (WWH), INC.
	 	 	 
	 

	 	/s/ Iain MacKenzie
	 

	 	 
	 

	 	Name: Iain MacKenzie
	 

	 	Title: President
	 
	 	 
	 

	 	  Address:
	 
	 	 
	 

	 	  4211 Starboard Drive
	 

	 	  Fremont, CA 94538
	 

	 	  Attn: Jack Pacheco
	 

	 	  Tel: (510) 623-1231
	 

	 	  Fax: (510) 360-8500

	 	 	 	 	 
	 	 	    IN THE PRESENCE OF:
	 
	 	 	 	 
	 

	 	    Witness:
	 	/s/ Nandan Kamath
	 

	 	 	 	 
	 

	 	    Name:
	 	NANDAN KAMATH
	 

	 	 	 	 

INTERCREDITOR AGREEMENT

 

 

	 	 	 
	 

	 	Acknowledged and Accepted:
	 
	 	 
	 

	 	The Companies:
	 
	 	 
	 

	 	EXECUTED AS A DEED BY:
	 
	 	 
	 

	 	SMART MODULAR TECHNOLOGIES
	 

	 	(GLOBAL), INC.
	 
	 	 
	 

	 	/s/ Ann Nguyen
	 

	 	 
	 

	 	Name: Ann Nguyen
	 

	 	Title: Secretary

	 	 	 	 	 
	 	 	IN THE PRESENCE OF:
	 
	 	 	 	 
	 

	 	Witness:
	 	/s/ Nandan Kamath
	 

	 	 	 	 
	 

	 	Name:
	 	NANDAN KAMATH
	 

	 	 	 	 

INTERCREDITOR AGREEMENT

 

 

	 	 	 
	 

	 	EXECUTED AS A DEED BY:
	 
	 	 
	 

	 	SMART MODULAR TECHNOLOGIES
(DH), INC.
	 
	 	 
	 

	 	/s/ Ann Nguyen
	 

	 	 
	 

	 	Name: Ann Nguyen
	 

	 	Title: Assistant Secretary

	 	 	 	 	 
	 	 	IN THE PRESENCE OF:
	 
	 	 	 	 
	 

	 	Witness:
	 	/s/ Nandan Kamath
	 

	 	 	 	 
	 

	 	Name:
	 	NANDAN KAMATH
	 

	 	 	 	 

INTERCREDITOR AGREEMENT

 

 

	 	 	 
	 

	 	EXECUTED AS A DEED BY:
	 
	 	 
	 

	 	SMART MODULAR TECHNOLOGIES
	 

	 	(CI), INC.
	 
	 	 
	 

	 	/s/ Ann Nguyen
	 

	 	 
	 

	 	Name: Ann Nguyen
	 

	 	Title: Assistant Secretary

	 	 	 	 	 
	 	 	IN THE PRESENCE OF:
	 
	 	 	 	 
	 

	 	Witness:
	 	/s/ Nandan Kamath
	 

	 	 	 	 
	 

	 	Name:
	 	NANDAN KAMATH
	 

	 	 	 	 

INTERCREDITOR AGREEMENT

 

 

	 	 	 
	 

	 	EXECUTED AS A DEED BY:
	 

	 	SMART MODULAR TECHNOLOGIES
	 

	 	(FOREIGN HOLDINGS), INC.
	 	 	 
	 

	 	/s/ Iain MacKenzie
	 

	 	 
	 

	 	Name: Iain MacKenzie
	 

	 	Title: President

	 	 	 	 	 
	 	 	IN THE PRESENCE OF:
	 
	 	 	 	 
	 

	 	Witness:
	 	/s/ Nandan Kamath
	 

	 	 	 	 
	 

	 	Name:
	 	NANDAN KAMATH
	 

	 	 	 	 

INTERCREDITOR AGREEMENT

 

 

	 	 	 
	 

	 	EXECUTED AS A DEED BY:
	 	 	 	 
	 

	 	SMART MODULAR TECHNOLOGIES
	 

	 	(PUERTO RICO) INC.
	 
	 	 
	 

	 	/s/ Iain MacKenzie
	 

	 	 
	 

	 	Name: Iain MacKenzie
	 

	 	Title: CEO & President

	 	 	 	 	 
	 	 	IN THE PRESENCE OF:
	 
	 	 	 	 
	 

	 	Witness:
	 	/s/ Nandan Kamath
	 

	 	 	 	 
	 

	 	Name:
	 	NANDAN KAMATH
	 

	 	 	 	 

INTERCREDITOR AGREEMENT

 

 

	 	 	 
	 

	 	Acknowledged and Accepted:
	 
	 	 
	 

	 	The Companies:
	 
	 	 
	 

	 	SMART MODULAR TECHNOLOGIES, INC.
	 
	 	 
	 

	 	/s/ Iain MacKenzie
	 

	 	 
	 

	 	Name: Iain MacKenzie
	 

	 	Title: CEO & President
	 
	 	 
	 

	 	Address:
	 
	 	 
	 

	 	4211 Starboard Drive
	 

	 	Fremont, California 94538
	 

	 	Attention: Jack Pacheco, Chief Financial Officer
	 

	 	Telecopy No.:(510) 380-8500

INTERCREDITOR AGREEMENT

 

 

	 	 	 
	 

	 	Acknowledged and Accepted:
	 
	 	 
	 

	 	The Companies:
	 
	 	 
	 

	 	SMART MODULAR TECHNOLOGIES
	 

	 	(DE), INC.
	 
	 	 
	 

	 	/s/ Ann Nguyen
	 

	 	 
	 

	 	Name: Ann Nguyen
	 

	 	Title: Assistant Secretary

INTERCREDITOR AGREEMENT

 

 

	 	 	 
	 

	 	SMART MODULAR TECHNOLOGIES
	 

	 	SDN. BHD.
	 
	 	 
	 

	 	/s/ Iain MacKenzie
	 

	 	 
	 

	 	Name: Iain MacKenzie
	 

	 	Title: Director

INTERCREDITOR AGREEMENT

 

 

	 	 	 
	 

	 	SMART MODULAR TECHNOLOGIES
	 

	 	(EUROPE) LIMITED
	 
	 	 
	 

	 	/s/ Ann Nguyen
	 

	 	 
	 

	 	Name: Ann Nguyen
	 

	 	Title: Secretary

INTERCREDITOR AGREEMENT

 

 

	 	 	 
	 

	 	MODULAR BRASIL PARTICIPAÇÕES
	 

	 	LTDA.
	 
	 	 
	 

	 	/s/ Noboru Takahashi
	 

	 	 
	 

	 	Name: Noboru Takahashi
	 

	 	Title: Officer

INTERCREDITOR AGREEMENT

 

 

	 	 	 
	 

	 	SMART MODULAR TECHNOLOGIES
	 

	 	INDÚSTRIA DE COMPONENTES
	 

	 	ELETRÔNICOS LTDA.
	 
	 	 
	 

	 	/s/ Noboru Takahashi
	 

	 	 
	 

	 	Name: Noboru Takahashi
	 

	 	Title: Officer

INTERCREDITOR AGREEMENTexv4w7

 

Exhibit 4.7

EXECUTION COPY

INTERCOMPANY SUBORDINATION AGREEMENT

          THIS INTERCOMPANY SUBORDINATION AGREEMENT (this “Agreement”), dated as of March 28, 2005, is
made among the Obligors (as defined below) and US BANK NATIONAL ASSOCIATION, a national banking
association, as Trustee (in such capacity, “Trustee”) for the holders of the Notes described below
(the “Noteholders”).

          WHEREAS, the Obligors and Trustee are parties to that certain Indenture, dated as of even date
herewith (as amended from time to time, the “Indenture”), governing $125,000,000 principal amount
of Senior Secured Floating Rate Notes due 2012 (the “Notes”) of SMART Modular Technologies (WWH),
Inc. (the “Company”), which Notes are guaranteed by the guarantors listed on the signature pages
hereto (the “Guarantors” and, together with the Company, the “Obligors”);

          WHEREAS, certain Obligors have made or may make certain loans or advances from time to time to
one or more other Obligors;

          WHEREAS, each Obligor has agreed to the subordination of such indebtedness of each other
Obligor to such Obligor, upon the terms and subject to the conditions set forth in this
Agreement and the Intercreditor Agreement.

          NOW, THEREFORE, in consideration of the mutual promises, covenants, conditions,
representations, and warranties set forth herein and for other good and valuable consideration, the
parties hereto agree as follows:

          SECTION 1. Definitions; Interpretation.

          (a) Terms Defined in Indenture. All capitalized terms used in this Agreement and not otherwise
defined herein shall have the meanings assigned to them in the Indenture.

          (b) Certain Defined Terms. As used in this Agreement, the following terms shall have the
following meanings:

          “Agreement” has the meaning set forth in the preamble to this Agreement.

          “Guarantors” has the meaning set forth in the recitals hereto.

          “Insolvency Event” has the meaning set forth in Section 3.

          “Intercreditor Agreement” means that certain Intercreditor Agreement, dated as of the date
hereof, by and among Wells Fargo Foothill, Inc., as Credit Agent, the Trustee, and the Obligors.

          “Notes” has the meaning set forth in the recitals hereto.

          “Obligors”has the meaning set forth in the recitals hereto.

 

 

          “Senior Debt” means the “Obligations” (as defined in the Indenture) of any Obligor.

          “Subordinated Debt” means, with respect to each Obligor, all indebtedness, liabilities, and
other obligations of any other Obligor owing to such Obligor in respect of any and all loans or
advances made by such Obligor to such other Obligor whether now existing or hereafter arising, and
whether due or to become due, absolute or contingent, liquidated or unliquidated, determined or
undetermined, including all fees and all other amounts payable by any other Obligor to such Obligor
under or in connection with any documents or instruments related thereto.

          “Subordinated Debt Payment” means any payment or distribution by or on behalf of an Obligor,
directly or indirectly, of assets of such Obligor of any kind or character, whether in cash,
property, or securities (including on account of the purchase, redemption, or other acquisition
of Subordinated Debt) as a result of a collection, sale, or other disposition of Collateral, or by
setoff, exchange, or in any other manner, in each case for or on account of the Subordinated Debt.

          “Trustee” has the meaning set forth in the preamble to this Agreement.

          (c) Interpretation. Unless the context of this Agreement clearly requires otherwise,
references to the plural include the singular, references to the singular include the plural, the
term “including” is not limiting, and the term “or” has, except where otherwise indicated, the
inclusive meaning represented by the phrase “and/or.” The words “hereof,” “herein,” “hereby,”
“hereunder,” and similar terms in this Agreement refer to this Agreement as a whole and not to any
particular provision of this Agreement. Section, subsection, clause, schedule, and exhibit
references are to this Agreement unless otherwise specified. References to agreements and other
contractual instruments shall be deemed to include all subsequent amendments and other
modifications thereto. References to statutes or regulations are to be construed as including all
statutory and regulatory provisions consolidating, amending, or replacing the statute or regulation
referred to. The captions and headings are for convenience of reference only and shall not affect
the construction of this Agreement.

          SECTION 2. Subordination to Payment of Senior Debt. Subject to the Intercreditor Agreement,
as to each Obligor, all payments on account of the Subordinated Debt shall be subject, subordinate,
and junior, in right of payment and exercise of remedies, to the extent and in the manner set forth
herein, to the prior payment, in full, in cash or cash equivalents of the Senior Debt.

          SECTION 3. Subordination Upon Any Distribution of Assets of the Obligors. After the Discharge
of Credit Agreement Obligations, as to each Obligor, in the event of any payment or distribution
of assets of any other Obligor of any kind or character, whether in cash, property, or securities,
upon the dissolution, winding up, or total or partial liquidation or reorganization, readjustment,
arrangement, or similar proceeding relating to such other Obligor or its property, whether
voluntary or involuntary, or in bankruptcy, insolvency, receivership, arrangement, or similar proceedings or upon an
assignment for the benefit of creditors, or upon any other marshaling or composition of the assets
and liabilities of such other Obligor, or otherwise,

-2-

 

in each case except in connection with any transaction permitted by Section 5.01 of the Indenture
(such events, collectively, the “Insolvency Events”): (i) all amounts owing on account of the
Senior Debt shall first be paid, in full, in cash, or payment provided for in cash or in cash
equivalents, before any Subordinated Debt Payment is made; and (ii) to the extent permitted by
applicable law, any Subordinated Debt Payment to which such Obligor would be entitled except for
the provisions hereof, shall be paid or delivered by the trustee in bankruptcy, receiver, assignee
for the benefit of creditors, or other liquidating agent making such payment or distribution
directly to Trustee for application to the payment of the Senior Debt in accordance with clause
(i), after giving effect to any concurrent payment or distribution or provision therefor to Trustee
or any Noteholder in respect of such Senior Debt.

          SECTION 4. Payments on Subordinated Debt.

          (a) Permitted Payments. Subject to Section 4(b) and the Intercreditor Agreement, each Obligor
may make, and each other Obligor shall be entitled to accept and receive, payments on account of the
Subordinated Debt.

          (b) No Payment Upon Senior Debt Defaults. Upon the occurrence of any Event of Default, and
until such Event of Default is cured or waived, except for Subordinated Debt Payments made in
connection with any transaction permitted under Section 5.01 of the Indenture and the Intercreditor
Agreement, no Obligor shall make, and no Obligor or Subsidiary shall accept or receive, any
Subordinated Debt Payment.

          SECTION 5. Subordination of Remedies. After the Discharge of Credit Agreement Obligations, as
long as any Senior Debt shall remain outstanding and unpaid, upon the occurrence of any Event
of Default and until such Event of Default is cured or waived, except for Subordinated Debt Payments
made in connection with any transaction permitted under Section 5.01 of the Indenture, no Obligor
shall, without the prior written consent of Trustee:

     (a) accelerate, make demand, or otherwise make due and payable prior to the original due
date thereof any Subordinated Debt or bring suit or institute any other actions or proceedings to
enforce its rights or interests in respect of any Subordinated Debt of any other Obligor owing to
such Obligor;

     (b) exercise any rights under or with respect to any guaranties of Subordinated Debt, if any;

     (c) exercise any rights to set-offs and counterclaims in respect of any indebtedness, liabilities, or obligations of such Obligor to any other Obligor against any of the Subordinated Debt; or

     (d) commence, or cause to be commenced, or join with any creditor other than Trustee or the
Noteholders in commencing, any bankruptcy, insolvency, or receivership proceeding against any
other Obligor.

          SECTION 6. Payment Over to Trustee. After the Discharge of Credit Agreement Obligations, in
the event that, notwithstanding the provisions of Section 3, Section 4,

-3-

 

and Section 5, any Subordinated Debt Payment shall be received in contravention of Section 3,
Section 4, or Section 5 by any Obligor before all Senior Debt is paid, in full, in cash or cash
equivalents, such Subordinated Debt Payment shall be held in trust for the benefit of Trustee and
shall be paid over or delivered to Trustee for application to the payment, in full, in cash or cash
equivalents of all Senior Debt remaining unpaid to the extent necessary to give effect to Section
3, Section 4, and Section 5, after giving effect to any concurrent payments or distributions to
Trustee or any Noteholder in respect of the Senior Debt.

          SECTION 7. Authorization to Trustee. After the Discharge of Credit Agreement Obligations, if,
while any Subordinated Debt is outstanding, any Insolvency Event shall occur and be continuing with
respect to any other Obligor or its property: (i) Trustee hereby is irrevocably authorized and
empowered (in the name of each Obligor or otherwise), but shall have no obligation, to demand, sue
for, collect, and receive every payment or distribution in respect of Subordinated Debt and give
acquittance therefor and to file claims and proofs of claim and take such other action (including
voting any Subordinated Debt) as it may deem necessary or advisable for the exercise or enforcement
of any of the rights or interests of Trustee; and (ii) each Obligor shall promptly take such action
as Trustee reasonably may request, to the extent permitted under applicable law, (A) to collect the
Subordinated Debt for the account of Trustee and to file appropriate claims or proofs of claim in
respect of the Subordinated Debt, (B) to execute and deliver to Trustee such powers of attorney,
assignments, and other instruments as it may request to enable it to enforce any and all claims
with respect to the Subordinated Debt, and (C) to collect and receive any and all Subordinated Debt
Payments.

          SECTION 8. Certain Agreements of Each Obligor.

          (a) No Benefits. Each Obligor understands that there may be various agreements between or
among Trustee, on the one hand, and the other Obligors, on the other hand, evidencing and governing
the Senior Debt, and each Obligor acknowledges and agrees that such agreements are not intended to
confer any benefits on such Obligor and that the Trustee shall not have any obligation to such
Obligor or any other Person to exercise any rights, enforce any remedies, or take any actions which
may be available to them under such agreements.

          (b) No Interference. Each Obligor acknowledges that each other Obligor has granted to Trustee
for the benefit of the Noteholders, Liens on all of such other Obligor’s assets (subject to certain
exceptions set forth in the Security Documents and subject to the Intercreditor Agreement), and
agrees not to interfere with or in any manner oppose a disposition of any Collateral by Trustee in
accordance with applicable law and the Security Documents.

          (c) Reliance by Trustee. Each Obligor acknowledges and agrees that the Trustee will have relied
upon and will continue to rely upon the subordination provisions provided for herein and the other
provisions hereof in entering into the Indenture and the Security Documents.

          (d) Waivers. Except as provided under the Indenture and the Intercreditor Agreement, to the
extent permitted by applicable law, each Obligor hereby waives any and all notice of the incurrence
of the Senior Debt or any part thereof and any right to require marshaling of assets.

-4-

 

          (e) Obligations of Each Obligor Not Affected. Each Obligor hereby agrees, to the extent
permitted by applicable law, that at any time and from time to time, without notice to or the
consent of such Obligor, without incurring responsibility to such Obligor, and without impairing or
releasing the subordination provided for herein or otherwise impairing the rights of Trustee
hereunder, (i) the time for any other Obligor’s performance of or compliance with any of its
agreements contained in the Indenture and the Security Documents may be extended or such
performance or compliance may be waived by Trustee (in accordance with the Security Documents or
the indenture); (ii) the agreements of any other Obligor with respect to the Security Documents or
Indenture may from time to time be modified by such other Obligor or Trustee (in accordance with
the Security Documents or the Indenture) for the purpose of adding any requirements thereto or
changing in any manner the rights and obligations of such other Obligor or Trustee thereunder;
(iii) the manner, place, or terms for payment of Senior Debt or any portion thereof may be altered
or the terms for payment extended, or the Senior Debt may be renewed in whole or in part; (iv) the
maturity of the Senior Debt may be accelerated in accordance with the terms of any present or
future agreement by any other Obligor or Trustee (in accordance with the Security Documents or
Indenture); (v) any Collateral may be sold, exchanged, released, or substituted and any Lien in
favor of Trustee may be terminated, subordinated, or fail to be perfected or become unperfected (in
accordance with the Security Documents); (vi) any Person liable in any manner for Senior Debt may
be discharged, released, or substituted; and (vii) all other rights against the other Obligors, any
other Person, or with respect to any Collateral may be exercised subject to the Intercreditor
Agreement (or Trustee may waive or refrain from exercising such rights in accordance with the
Security Documents or the Indenture).

          (f) Rights of Trustee Not to Be Impaired. No right of Trustee to enforce the
subordination provided for herein or to exercise its other rights hereunder shall at any time in any
way be prejudiced or impaired by any act or failure to act by any other Obligor, Trustee or under or
in connection with the other Security Documents or the Indenture or by any noncompliance by the
other Obligors with the terms and provisions and covenants herein or in any other Security Document
or the Indenture, regardless of any knowledge thereof Trustee may have or otherwise be charged with.

          (g) Financial Condition of the Obligors. Except as provided under the Indenture, no Obligor
shall have any right to require Trustee to obtain or disclose any information with respect to: (i)
the financial condition or character of any other Obligor or the ability of any other Obligor to pay
and perform the Senior Debt; (ii) the existence or nonexistence of any guarantees of, or any other
subordination agreements with respect to, all or any part of the Senior Debt; (iii) any action or
inaction on the part of Trustee; or (iv) any other matter, fact, or occurrence whatsoever.

          (h) Acquisition of Liens or Guaranties. After the Discharge of Credit Agreement Obligations,
except as permitted under the Indenture, no Obligor shall, without the prior consent of Trustee,
acquire any right or interest in or to any Collateral not owned by such Obligor or accept any
guaranties for the Subordinated Debt.

-5-

 

          SECTION 9. Subrogation.

          (a) Subrogation. After the Discharge of Credit Agreement Obligations, until the payment and
performance in full in cash of all Senior Debt, no Obligor shall have, or directly or indirectly
exercise, any rights that it may acquire by way of subrogation under this Agreement, by any payment
or distribution to Trustee hereunder or otherwise. After the Discharge of Credit Agreement
Obligations, upon the payment and performance in full in cash of all Senior Debt, each Obligor shall
be subrogated to the rights of Trustee to receive payments or distributions applicable to the
Senior Debt until the Subordinated Debt shall be paid in full. For the purposes of the foregoing
subrogation, no payments or distributions to Trustee of any cash, property, or securities to which
any Obligor would be entitled except for the provisions of
Section 3, Section 4, or Section 5
shall, as among such Obligor, its creditors (other than Trustee), and the other Obligors, be deemed
to be a payment by the other Obligors to or on account of the Senior Debt.

          (b) Payments Over to the Obligors. If any payment or distribution to which any Obligor would
otherwise have been entitled but for the provisions of
Section 3, Section 4, or Section 5 shall have
been applied pursuant to the provisions of Section 3,
Section 4, or Section 5 to the payment of all
amounts payable under the Senior Debt, such Obligor shall be entitled to receive from Trustee, as
the case may be, any payments or distributions received by such Person in excess of the amount
sufficient to pay in full in cash all amounts payable under or in respect of the Senior Debt. If any
such excess payment is made to Trustee, such Person shall promptly remit such excess to such Obligor and
until so remitted shall hold such excess payment for the benefit of such Obligor.

          SECTION 10. Continuing Agreement; Reinstatement.

          (a) Continuing Agreement. This Agreement is a continuing agreement of subordination and shall
continue in effect and be binding upon each Obligor until payment and performance in full in cash
of the Senior Debt. The subordinations, agreements, and priorities set forth herein shall remain in
full force and effect regardless of whether any party hereto in the future seeks to rescind, amend,
terminate, or reform, by litigation or otherwise, its respective agreements with the other
Obligors.

          (b) Reinstatement. This Agreement shall continue to be effective or shall be reinstated, as
the case may be, if, for any reason, any payment of the Senior Debt by or on behalf of any other
Obligor shall be rescinded or must otherwise be restored by Trustee, whether as a result of an
Insolvency Event or otherwise.

          SECTION 11. Transfer of Subordinated Debt. After the Discharge of Credit Agreement
Obligations, except as permitted under the Indenture, no Obligor may assign or transfer its rights
and obligations in respect of the Subordinated Debt without the prior written consent of Trustee,
and any such transferee or assignee, as a condition to acquiring an interest in the Subordinated
Debt shall agree to be bound hereby, in form reasonably satisfactory to Trustee.

          SECTION 12. Obligations of the Obligors Not Affected. The provisions of this Agreement are
intended solely for the purpose of defining the relative rights of Each Obligor

-6-

 

against the other Obligors, on the one hand, and of the Trustee against the Obligors, on the other
hand. Nothing contained in this Agreement shall (i) impair, as between each Obligor and the other
Obligors, the obligation of the other Obligors to pay their respective obligations with respect to
the Subordinated Debt as and when the same shall become due and payable, or (ii) otherwise affect
the relative rights of each Obligor against the other Obligors, on the one hand, and of the
creditors (other than Trustee) of the other Obligors against the other Obligors, on the other hand.

          SECTION 13. Endorsement of Obligor Documents; Further Assurances and Additional Acts.

          (a) Endorsement of Obligor Documents. After the Discharge of Credit Agreement Obligations, at
the request of Trustee, all documents and instruments evidencing any of the Subordinated Debt, if
any, shall be endorsed with a legend noting that such documents and instruments are subject to this
Agreement, and each Obligor shall promptly deliver to Trustee evidence of the same.

          (b) Further Assurances and Additional Acts. After the Discharge of Credit Agreement
Obligations, each Obligor shall execute, acknowledge, deliver, file, notarize, and register at its
own expense all such further agreements, instruments, certificates, financing statements,
documents, and assurances, and perform such acts as Trustee reasonably shall deem necessary or
appropriate to effectuate the purposes of this Agreement, and promptly provide Trustee with evidence
of the foregoing reasonably satisfactory in form and substance to Trustee.

          SECTION 14. Notices. All notices and other communications provided for hereunder shall, unless
otherwise stated herein, be delivered in accordance with the notice provisions contained in the
Indenture.

          SECTION 15. No Waiver; Cumulative Remedies. No failure on the part of Trustee to exercise, and
no delay in exercising, any right, remedy, power, or privilege hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise of any such right, remedy, power, or privilege
preclude any other or further exercise thereof or the exercise of any other right, remedy, power,
or privilege. The rights and remedies under this Agreement are cumulative and not exclusive of any
rights, remedies, powers, and privileges that may otherwise be available to Trustee.

          SECTION 16. Intercreditor Agreement. Notwithstanding anything herein to the contrary, this
Agreement and the exercise of any right or remedy by the Trustee hereunder are subject to the
provisions of the Intercreditor Agreement. In the event of any conflict between the terms of the
Intercreditor Agreement and this Agreement, the terms of the Intercreditor Agreement shall govern
and control. Notwithstanding anything herein to the contrary, until the Discharge of Credit
Agreement Obligations, the requirements of this Agreement to deliver any documents relating to the
Subordinated Debt to the Trustee shall be deemed satisfied by delivery of such documents to the
Credit Agent (as such term is defined in the Intercreditor Agreement).

          SECTION 17. Survival. All covenants, agreements, representations and warranties made in this
Agreement shall, except to the extent otherwise provided herein, survive the

-7-

 

execution and delivery of this Agreement, and shall continue in full force and effect so long as any
Senior Debt remains unpaid.

          SECTION 18. Benefits of Agreement. This Agreement is entered into for the sole protection and
benefit of the parties hereto and their successors and assigns, and no other Person shall be a
direct or indirect beneficiary of, or shall have any direct or indirect cause of action or claim in
connection with, this Agreement.

          SECTION 19. Binding Effect. This Agreement shall be binding upon, inure to the benefit of and
be enforceable by each Obligor, Trustee, and their respective successors and permitted assigns.

          SECTION 20. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE
WITH, THE LAWS OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAW PROVISIONS (OTHER
THAN SECTION 5-1401 OF THE NEW YORK GENERAL OBLIGATIONS LAW), AND THE OBLIGATIONS, RIGHTS AND
REMEDIES OF THE PARTIES HEREUNDER SHALL BE DETERMINED IN ACCORDANCE WITH SUCH LAWS.

          SECTION 21. SUBMISSION TO JURISDICTION. TO THE EXTENT PERMITTED BY APPLICABLE LAW, EACH PARTY
HERETO HEREBY (i) SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF THE STATE AND FEDERAL COURTS LOCATED
IN THE BOROUGH OF MANHATTAN, COUNTY OF NEW YORK, STATE OF NEW YORK, FOR THE PURPOSE OF ANY ACTION
OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, (ii) AGREES THAT ALL CLAIMS IN RESPECT
OF ANY SUCH ACTION OR PROCEEDING MAY BE HEARD AND DETERMINED IN SUCH COURTS, OR IN ANY OTHER COURT
OF ITS OWN CORPORATE DOMICILE, AT THE ELECTION OF THE PLAINTIFF, IN RESPECT OF ACTIONS BROUGHT
AGAINST IT AS A DEFENDANT (iii) IRREVOCABLY WAIVES (TO THE EXTENT PERMITTED BY APPLICABLE LAW) ANY
OBJECTION WHICH IT NOW OR HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH ACTION OR
PROCEEDING BROUGHT IN ANY OF THE FOREGOING COURTS, AND ANY OBJECTION ON THE GROUND THAT ANY SUCH
ACTION OR PROCEEDING IN ANY SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM AND (iv) AGREES
THAT A FINAL JUDGMENT IN ANY SUCH ACTION OR PROCEEDING SHALL BE CONCLUSIVE AND MAY BE ENFORCED IN
OTHER JURISDICTIONS BY SUIT ON THE JUDGMENT OR IN ANY OTHER MANNER PERMITTED BY LAW.

          SECTION 22. Entire Agreement; Amendments and Waivers.

          (a) Entire Agreement. This Agreement constitutes the entire agreement of each of the Obligors,
and Trustee with respect to the matters set forth herein and supersedes any prior agreements,
commitments, draft, communications, discussions and understandings, oral or written, with respect
thereto.

-8-

 

          (b) Amendments and Waivers. No amendment or waiver of any provision of this Agreement, and no
consent with respect to any departure by any Obligor therefrom, shall be effective unless the same
shall be in writing and signed by the Trustee and Obligors and made in compliance with the terms of
the Indenture and the Intercreditor Agreement, and then any such waiver or consent shall be
effective only in the specific instance and for the specific purpose for which given. No failure by
Trustee to exercise any right, remedy, or option under this Agreement, or delay by Trustee in
exercising the same, will operate as a waiver thereof. No waiver by Trustee on any occasion
shall affect or diminish Trustee’s rights thereafter to require strict performance by each Obligor
of any provision of this Agreement. Trustee’s rights under this Agreement will be cumulative and not
exclusive of any other right or remedy that Trustee may have.

          SECTION 23. Conflicts. In case of any conflict or inconsistency between any terms of this
Agreement, on the one hand, and any documents or instruments in respect of the Subordinated Debt,
on the other hand, then the terms of this Agreement shall control.

          SECTION 24. Severability. Each provision of this Agreement shall be severable from every other
provision of this Agreement for the purpose of determining the legal enforceability of any specific
provision.

          SECTION 25. Interpretation. This Agreement is the result of negotiations between, and have
been reviewed by the respective counsel to, the Obligors and Trustee and is the product of all
parties hereto. Accordingly, this Agreement shall not be construed against Trustee merely because
of their involvement in the preparation hereof.

          SECTION 26. Counterparts; Telefacsimile Execution. This Agreement may be executed in any
number of counterparts and by different parties hereto in separate counterparts, each of which when
so executed shall be deemed to be an original and all of which, when taken together, shall
constitute but one and the same agreement. Delivery of an executed counterpart of this Agreement by
telefacsimile shall be equally effective as delivery of an original executed counterpart of this
Agreement. Any party delivering an executed counterpart of this Agreement by telefacsimile also
shall deliver an original executed counterpart of this Agreement but the failure to deliver an
original executed counterpart shall not affect the validity, enforceability, and binding effect
of this Agreement.

          SECTION 27. Termination of Agreement. Upon payment and performance in full in cash of the Senior
Debt (other than unmatured contingent obligations) and the termination of the Commitments, this
Agreement shall terminate and Trustee shall promptly execute and deliver to each Obligor such
documents and instruments as shall be reasonably necessary to evidence such termination. Upon the
consummation of any permitted disposition of any party hereto, such party shall be automatically
released from its obligations hereunder, and the Pledgee shall, at the expense of the Pledgor,
execute and deliver such documents, and take such other action, as may be requested from time to
time by such party to evidence such release.

[Signature pages follow.]

-9-

 

          IN WITNESS WHEREOF, the undersigned have executed and delivered this Agreement as of the date
first written above.

	 	 	 	 	 	 	 
	 	 	SMART MODULAR TECHNOLOGIES (WWH), INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Iain MacKenzie	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Iain MacKenzie	 	 
	 

	 	 	 	Title: President	 	 
	 
	 	 	 	 	 	 
	 	 	EXECUTED AS A DEED	 	 

[SIGNATURE PAGE TO THE INTERCOMPANY

SUBORDINATION AGREEMENT]

 

	 	 	 	 	 	 	 
	 	 	SMART MODULAR TECHNOLOGIES (GLOBAL), INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Ann Nguyen	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Ann Nguyen	 	 
	 

	 	 	 	Title: Secretary	 	 
	 
	 	 	 	 	 	 
	 	 	EXECUTED AS A DEED	 	 

[SIGNATURE PAGE TO THE INTERCOMPANY

SUBORDINATION AGREEMENT]

 

 

	 	 	 	 	 	 	 
	 	 	SMART MODULAR TECHNOLOGIES (DH), INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Ann Nguyen	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Ann Nguyen	 	 
	 

	 	 	 	Title: Assistant Secretary	 	 
	 
	 	 	 	 	 	 
	 	 	EXECUTED AS A DEED	 	 

[SIGNATURE PAGE TO THE INTERCOMPANY

SUBORDINATION AGREEMENT]

 

 

	 	 	 	 	 	 	 
	 	 	SMART MODULAR TECHNOLOGIES (CI), INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Ann Nguyen	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Ann Nguyen	 	 
	 

	 	 	 	Title: Assistant Secretary	 	 
	 
	 	 	 	 	 	 
	 	 	EXECUTED AS A DEED	 	 

[SIGNATURE PAGE TO THE INTERCOMPANY

SUBORDINATION AGREEMENT]

 

 

	 	 	 	 	 	 	 
	 	 	SMART MODULAR TECHNOLOGIES

(FOREIGN HOLDINGS), INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By
	 	/s/ Iain MacKenzie	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Iain MacKenzie

Title: President	 	 
	 
	 	 	 	 	 	 
	 	 	EXECUTED AS A DEED	 	 

[SIGNATURE PAGE TO THE INTERCOMPANY

SUBORDINATION AGREEMENT]

 

 

	 	 	 	 	 	 	 
	 	 	SMART MODULAR TECHNOLOGIES (PUERTO RICO) INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Iain MacKenzie	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Iain MacKenzie	 	 
	 

	 	 	 	Title: CEO & President	 	 
	 
	 	 	 	 	 	 
	 	 	EXECUTED AS A DEED	 	 

[SIGNATURE PAGE TO THE INTERCOMPANY

SUBORDINATION AGREEMENT]

 

 

	 	 	 	 	 	 	 
	 	 	SMART MODULAR TECHNOLOGIES, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Iain MacKenzie	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Iain MacKenzie	 	 
	 

	 	 	 	Title: CEO & President	 	 

[SIGNATURE PAGE TO THE INTERCOMPANY

SUBORDINATION AGREEMENT]

 

 

	 	 	 	 	 	 	 
	 	 	SMART MODULAR TECHNOLOGIES (DE), INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Ann Nguyen	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Ann Nguyen	 	 
	 

	 	 	 	Title: Assistant Secretary	 	 

[SIGNATURE PAGE TO THE INTERCOMPANY

SUBORDINATION AGREEMENT]

 

 

	 	 	 	 	 	 	 
	 	 	SMART MODULAR TECHNOLOGIES SDN. BHD.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Iain MacKenzie	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Iain MacKenzie	 	 
	 

	 	 	 	Title: Director	 	 

[SIGNATURE PAGE TO THE INTERCOMPANY

SUBORDINATION AGREEMENT]

 

 

	 	 	 	 	 	 	 
	 	 	SMART MODULAR TECHNOLOGIES (EUROPE) LIMITED	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Ann Nguyen	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Ann Nguyen	 	 
	 

	 	 	 	Title: Secretary	 	 

[SIGNATURE PAGE TO THE INTERCOMPANY

SUBORDINATION AGREEMENT]

 

 

	 	 	 	 	 	 	 
	 	 	SMART MODULAR TECHNOLOGIES

INDÚSTRIA DE COMPONENTES ELETRÔNICOS LTDA.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Noboru Takahashi	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Noboru Takahashi	 	 
	 

	 	 	 	Title: Officer	 	 

[SIGNATURE PAGE TO THE INTERCOMPANY

SUBORDINATION AGREEMENT]

 

 

	 	 	 	 	 	 	 
	 	 	MODULAR BRASIL
PARTICIPAÇÕES LTDA.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Noboru Takahashi	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Noboru Takahashi	 	 
	 

	 	 	 	Title: Officer	 	 

[SIGNATURE PAGE TO THE INTERCOMPANY

SUBORDINATION AGREEMENT]

 

 

	 	 	 	 	 	 	 
	 	 	U.S. NATIONAL BANK ASSOCIATION

     as Trustee	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Richard Prokosch	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Name: Richard Prokosch	 	 
	 

	 	 	 	Title: Vice President	 	 

[SIGNATURE PAGE TO THE INTERCOMPANY

SUBORDINATION AGREEMENT]

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00089-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00089-of-00352.parquet"}]]