Common use of Permitted Payments Clause in Contracts

Permitted Payments. (a) Subject to all the other terms and conditions of this Subordination Agreement, Senior Creditor hereby agrees that, unless and until Senior Creditor has notified the Junior Creditor Representative of the occurrence of a default or an event of default or the occurrence of an event or existence of a condition which does, or would, with notice or lapse of time or both constitute an event of default under the Senior Creditor Agreements, and in each case specifying such event (such notice a "Payment Block Notice"), Hanover may make, and Junior Creditor may receive and retain from Hanover (i) payments of interest when due as regularly scheduled, and (ii) payment of principal when due at scheduled maturity on August 1, 1998, and (iii) prepayments of principal, plus accrued interest thereon, funded with the proceeds of an equity offering of Hanover, in each case under clauses (i) and (ii) in accordance with the terms of the Notes and the Indenture as in effect on the date hereof (but not any other prepayment of principal or interest or other payment of principal or any payment pursuant to acceleration or claims of breach or any payment to acquire any Junior Debt or otherwise), and (iv) reimbursement to Junior Creditor, prior to an event of default under any Junior Debt, for out-of-pocket expenses payable by Hanover pursuant to the Junior Creditor Agreements. After a Payment Block Notice is given, no payment otherwise permitted to be made to or received in respect of the Junior Debt may be made to or received by Junior Creditor until the expiration of the Standstill Period hereunder, and no such payment may be made or received after such period if a Complete Standstill Event has occurred or shall thereafter occur and while such Complete Standstill Event is continuing.

Permitted Payments. (a) Subject Notwithstanding anything to all the other terms and conditions of this Subordination Agreementcontrary set forth herein, Senior Creditor hereby agrees that, unless and until Senior Creditor has notified the Junior Creditor Representative of the occurrence of a default or an event of default or the occurrence of an event or existence of a condition which does, or would, with notice or lapse of time or both constitute an event of default under the Senior Creditor Agreements, and in each case specifying such event (such notice a "Payment Block Notice"), Hanover may make, and Junior Creditor may receive and retain from Hanover (i) so long as (x) no Payment Default exists, and so long as (y) the Subordinated Creditors have not received a Blockage Notice with respect to any other Event of Default, the Credit Parties may, from time to time, pay or cause to be paid to the Subordinated Creditors and the Subordinated Creditors may accept and retain scheduled payments of principal and of interest when due on the Subordinated Indebtedness in the amounts and on the dates required to be paid by the Credit Parties under the Subordinated Debt Documents, as regularly scheduledoriginally executed and delivered or as amended from time to time without violation of Section 6, and (ii) so long as (x) no Payment Default exists, (y) the Subordinated Creditors have not received a Blockage Notice with respect to any other Event of Default and (z) no Default or Event of Default shall result from the making of any such payment and such payment is made to the extent and only to the extent permitted under Schedule A to this Agreement, the Credit Parties may make prepayments of principal when due at scheduled maturity on August 1, 1998, and (iii) prepayments of principal, plus accrued interest thereon, funded with the proceeds of an equity offering of Hanover, in each case under clauses (i) and (ii) in accordance with the terms of the Notes and the Indenture as in effect on the date hereof (but not any other prepayment of principal or interest or other payment of principal or any payment pursuant to acceleration or claims of breach or any payment to acquire any Junior Debt or otherwise), and (iv) reimbursement to Junior Creditor, prior to an event of default under any Junior Debt, for out-of-pocket expenses payable by Hanover pursuant to the Junior Creditor Agreements. After a Payment Block Notice is given, no payment otherwise permitted to be made to or received in respect of the Junior Debt may be made Subordinated Indebtedness. In addition to or received payments permitted under the first sentence of this Section 2.6(a), if the then holders of the Senior Indebtedness shall not have accelerated the payment of the Senior Indebtedness within 180 days after receipt by Junior Creditor until the Subordinated Creditors of a Blockage Notice, then after the expiration of such 180-day period (or if during said 180-day period such Event of Default is cured by the Standstill Period hereunderCredit Parties or is waived by the then holders of the Senior Indebtedness, then after the time of such cure or waiver), and if no Payment Default exists, the Credit Parties may from time to time pay or cause to be paid to the Subordinated Creditors and the Subordinated Creditors may accept and retain payments of interest on the Subordinated Indebtedness (not in excess of the scheduled payments of interest required to be made by the Credit Parties under the Subordinated Debt Documents, as originally executed and delivered or as amended from time to time without violation of Section 6 hereof, including any interest payments which were not paid as a result of such Blockage Notice or the prior existence of a Payment Default), provided, that if thereafter any Payment Default occurs or any other -------- Blockage Notice is sent, then the first sentence of this Section 2.6(a) shall again apply. If the Subordinated Creditors or any other holder of the Subordinated Indebtedness receives payment from the Credit Parties pursuant to the first sentence of this Section 2.6(a), such payment shall be deemed to constitute a representation of the Credit Parties to the Senior Creditor and to the Subordinated Creditors that no Event of Default exists, that such payment is permitted to be paid by the Credit Parties under this Agreement, and the Subordinated Creditors shall be entitled to keep and retain such payment. Notwithstanding anything which may be made to the contrary herein, the Senior Creditor shall not be entitled to block payments pursuant to a Blockage Notice delivered hereunder for more than 180 days during any 360 day period or received after such period if a Complete Standstill Event has occurred or shall thereafter occur and while such Complete Standstill Event is continuingsend more than three (3) Blockage Notices during the term of this Agreement.

Permitted Payments. Notwithstanding anything contained herein to the contrary, Subordinating Creditor may receive from Borrower: (i) payments on the initial $1,107,678.76 of invoices outstanding (the "Initial Invoices") in the ordinary course and when due according to their terms, provided (a) Subject to all a Default (which has not been cured if a cure is permitted under the other terms of the Loan and conditions of this Subordination Security Agreement) has not occurred under the Loan and Security Agreement, Senior Creditor hereby agrees thatand/or the permitted payment will not cause a Default under the Loan Agreement, unless and until Senior (b) Subordinating Creditor has notified the Junior Creditor Representative not received notice of the occurrence of a default or an event the Default, at which time upon receipt of default or the occurrence of an event or existence of a condition which doessuch notice, or would, with notice or lapse of time or both constitute an event of default under the Senior Creditor Agreements, and in each case specifying such event (such notice a "Payment Block Notice"), Hanover Subordinating Credit may make, and Junior Creditor may no longer receive and retain payments from Hanover (i) payments of interest when due as regularly scheduled, Borrower; and (ii) payment as to all other amounts other than the Initial Invoices (the "Remaining Invoices"), payments on invoices in the ordinary course, as and when due, but without acceleration or prepayment thereof for any reason, limited to the lesser of, the amount currently due under the invoices or fifty (50%) percent of principal Free Cash Flow measured monthly (defined as net income plus depreciation and amortization less debt service, capital expenditures, distributions, dividends, or loans to employees, shareholders or officers and affiliates) as and when due at scheduled maturity on August 1due, 1998, and provided (iiia) prepayments of principal, plus accrued interest thereon, funded with the proceeds of an equity offering of Hanover, in each case a Default (which has not been cured if a cure is permitted under clauses (i) and (ii) in accordance with the terms of the Notes Loan and Security Agreement) has not occurred under the Indenture as in effect on Loan and Security Agreement, and/or the date hereof permitted payment will not cause a Default under the Loan Agreement, (but b) Subordinating Creditor has not any other prepayment received notice of principal or interest or other payment the occurrence of principal or any payment pursuant to acceleration or claims the Default, at which time upon receipt of breach or any payment to acquire any Junior Debt or otherwise)such notice, Subordinating Credit may no longer receive payments from Borrower, and (ivc) reimbursement Borrower has sufficient excess availability to Junior Creditormake repayment. In no event, prior however, shall Subordinating Creditor make any demand or claim against Borrower for any sums due in excess of the above amounts until all Senior Indebtedness now existing or hereafter created is indefeasibly paid in full in cash. It is agreed that the first monies paid by Borrower to an event of default under any Junior Debt, for out-of-pocket expenses payable by Hanover pursuant Subordinating Creditor shall be applied to the Junior Creditor Agreements. After a Payment Block Notice is given, no payment otherwise permitted Initial Invoices and all amounts thereafter will be applied to be made to or received in respect of the Junior Debt may be made to or received by Junior Creditor until the expiration of the Standstill Period hereunder, and no such payment may be made or received after such period if a Complete Standstill Event has occurred or shall thereafter occur and while such Complete Standstill Event is continuingRemaining Invoices.

Permitted Payments. (a) Subject to all So long as part of the other terms and conditions of this Subordination Agreement, Senior Creditor hereby agrees that, unless Superior Indebtedness remains outstanding and until Senior Creditor such time as the Agent provides the Subdebt Holder with written notice that a Default or Event of Default (as defined in the Credit Agreement) has notified occurred (a "Default Notice"), the Junior Creditor Representative Borrower may make and the Subdebt Holder may receive (i) regularly scheduled interest payments when and as due on the Subordinated Debt pursuant to the original terms thereof and (ii) if the Subordinated Debt has a term of repayment of not less than 3 years and provides for equal principal payments in each year of the occurrence term of a default or an event of default or such Subordinated Debt, regularly scheduled principal payments when and as due. Upon the occurrence of an event or existence Event of a condition which doesDefault, or would, with notice or lapse of time or both constitute an event of default under the Senior Creditor Agreements, and in each case specifying such event (such notice a "Payment Block Notice"), Hanover Borrower may not make, and Junior Creditor the Subdebt Holder may receive and retain from Hanover (i) not receive, regularly scheduled interest or principle payments of interest when due as regularly scheduled, and (ii) payment of principal when due at scheduled maturity on August 1, 1998, and (iii) prepayments of principal, plus accrued interest thereon, funded with the proceeds of an equity offering of Hanover, in each case under clauses (i) and (ii) in accordance with pursuant to the terms of the Notes Subordinated Debt. The Agent, in its discretion, may issue a Default Notice with respect to each and every such Default or Event of Default that occurs, but shall not have the Indenture right to issue more than one Default Notice with respect to any particular Default or Event of Default; provided, however, that if a Default or Event of Default has been cured or waived (or deemed waived as in effect on the date hereof (but not any other prepayment of principal or interest or other payment of principal or any payment pursuant to acceleration or claims of breach or any payment to acquire any Junior Debt or otherwiseprovided below), but subsequently reoccurs, then a new Default Notice may be sent with respect thereto. In the event that all Defaults and (iv) reimbursement to Junior CreditorEvents of Default shall be cured or waived, prior to an event then the Borrower may resume the making of default under any Junior Debtpayments otherwise permitted hereunder, for out-of-pocket expenses payable by Hanover pursuant subject to the Junior Creditor Agreements. After a Payment Block Notice is given, no payment otherwise permitted to be made to or received in respect of the Junior Debt may be made to or received by Junior Creditor until the expiration of the Standstill Period hereunder, and no such payment may be made or received after such period if a Complete Standstill Event has occurred or shall thereafter occur and while such Complete Standstill Event is continuingterms hereof.

Permitted Payments. (a) Subject Prior to all a Standstill Event, the other terms and conditions of this Subordination Agreement, Senior Creditor hereby agrees that, unless and until Senior Creditor has notified the Junior Creditor Representative of the occurrence of a default or an event of default or the occurrence of an event or existence of a condition which does, or would, with notice or lapse of time or both constitute an event of default under the Senior Creditor Agreements, and in each case specifying such event (such notice a "Payment Block Notice"), Hanover Credit Parties may make, and Junior Creditor the Tranche B Lenders may receive and retain from Hanover (i) receive, scheduled payments of principal and interest when due as regularly scheduled, and (ii) payment of principal when due at scheduled maturity on August 1, 1998, and (iii) prepayments of principal, plus accrued interest thereon, funded with owing by the proceeds of an equity offering of Hanover, in each case under clauses (i) and (ii) Borrower to the Tranche B Lenders in accordance with the terms Tranche B Credit Agreement, and any Mandatory Prepayments to which the Tranche B Lenders are entitled in accordance with Section 2.2 of the Notes this Agreement, and the Indenture as in effect on the date hereof (but not any other prepayment of principal or interest fee, expense reimbursement, indemnification claim or other payment of principal or any payment pursuant to acceleration or claims of breach or any payment to acquire any Junior Debt or otherwise), and (iv) reimbursement to Junior Creditor, prior to an event of default under any Junior Debt, claim provided for out-of-pocket expenses payable by Hanover pursuant to in the Junior Creditor AgreementsTranche B Credit Agreement. After a Payment Block Notice is givenStandstill Event, no the Borrower may not make, and the Tranche B Lenders may not receive, payment otherwise permitted to be made to or received in respect on account of the Junior Debt Tranche B Obligations except in accordance with Section 2.1. Prior to a Standstill Event, the Credit Parties may be made make, and the Tranche C Lenders may receive, scheduled payments of principal and interest owing by the Borrower to the Tranche C Lenders in accordance with the Tranche C Credit Agreement, and any Mandatory Prepayments to which the Tranche C Lenders are entitled in accordance with Section 2.2 of this Agreement, and any fee, expense reimbursement, indemnification claim or received by Junior Creditor until other claim provided for in the expiration Tranche C Credit Agreement. After a Standstill Event, the Borrower may not make, and the Tranche C Lenders may not receive, payment on account of the Tranche C Obligations except in accordance with Section 2.1. Prior to a Standstill Period hereunderEvent, the Parent may make, and no such the holders of First Units may receive, payments in accordance with Section 2.2 of this Agreement. After a Standstill Event, the Parent may not make, and the holders of First Units may not receive, any payment on account of the First Units unless all Tranche A Obligations, Tranche B Obligations and Tranche C Obligations are indefeasibly paid in full. Prior to a Standstill Event, the Parent may be made or received after such period if make, and the holders of Second Units may receive, payments in accordance with Section 2.2 of this Agreement. After a Complete Standstill Event has occurred or shall thereafter occur Event, the Parent may not make, and while such Complete Standstill Event is continuingthe holders of Second Units may not receive, any payment on account of the Second Units unless all Tranche A Obligations, Tranche B Obligations, Tranche C Obligations and First Units are indefeasibly paid in full.

Permitted Payments. (a) Subject Notwithstanding the foregoing provisions, but subject to all the other terms and conditions of this Subordination Agreementlimitations set forth below, Senior until such time as Subordinated Creditor hereby agrees that, unless and until Senior Creditor has notified the Junior Creditor Representative of the occurrence of a default or an event of default or the occurrence of an event or existence of a condition which doesshall have received, or wouldbe deemed to have received, with written notice or lapse of time or both constitute an event of default under the Senior Creditor Agreements, and in each case specifying such event (such notice a "Payment Block Notice"), Hanover may make, and Junior Creditor may receive and retain from Hanover (i) payments of interest when due as regularly scheduled, and (ii) payment of principal when due at scheduled maturity on August 1, 1998, and (iii) prepayments of principal, plus accrued interest thereon, funded with the proceeds of an equity offering of Hanover, in each case under clauses (i) and (ii) in accordance with the terms hereof from Sunrock or its agents of the Notes occurrence of an Event of Default or Potential Default, Subordinated Creditor may accept and retain from Borrower payments in respect of the Indenture Subordinated Debt to the extent expressly set forth on Exhibit A hereto (collectively, the “Permitted Payments”); provided, however: (i) after giving effect to each such Permitted Payment and any other payments then permitted under Section 9.9 of the Loan Agreement, the Excess Availability shall be equal to, or greater than, $750,000.00; (ii) Permitted Payments shall include only payments in respect of the original amortization schedule, if any, of the stated principal amount of the Subordinated Debt as set forth in effect the instruments described on Exhibit A without regard to any future amendment of such instruments (unless such amendment shall delay or reduce the otherwise scheduled principal payments) and only to the extent permitted by Exhibit A; (iii) Permitted Payments shall not include any amounts due and owing by Borrower to Subordinated Creditor in respect of reimbursement obligations (whether through contract, common law right of contribution or otherwise) related to the Letter of Credit or any increase in the stated principal amount of the Subordinated Debt as a result of any draw on the date hereof (but not any other prepayment Letter of principal or interest or other payment of principal or any payment pursuant to acceleration or claims of breach or any payment to acquire any Junior Debt or otherwise), Credit; and (iv) reimbursement to Junior Creditor, prior to an event of default under any Junior Debt, for out-of-pocket expenses payable by Hanover pursuant to the Junior Creditor Agreements. After a extent any Permitted Payment Block Notice is given, no payment otherwise not permitted to be made to or received in respect when scheduled as a result of the Junior foregoing conditions, such payment shall be deferred until the maturity of the Subordinated Debt. The original stated principal amount of the Subordinated Debt is hereby acknowledged and agreed to be as set forth on Exhibit A. From and after Subordinated Creditor’s receipt, or deemed receipt, of written notice of an Event of Default or Potential Default, Permitted Payments may not be made to accepted or received retained by Junior Subordinated Creditor until the expiration all Events of the Standstill Period hereunderDefault and Potential Defaults shall have been cured or otherwise waived by Sunrock. Upon receipt, or deemed receipt, of notice from Sunrock that all Events of Default and no such payment Potential Defaults have been cured or otherwise waived by Sunrock, Permitted Payments may be made or received after such period if a Complete Standstill Event has occurred or shall thereafter occur and while such Complete Standstill Event is continuingresume.

Permitted Payments. (a) Subject to all Notwithstanding the other terms of Section 3 hereinabove, from and conditions of this Subordination Agreement, after such time as the Senior Creditor hereby agrees that, unless and until Senior Creditor Lender has notified the Junior Subordinated Creditor Representative in writing that, after the effective date of the occurrence of a default or an event of default or Twelfth Amendment, the occurrence of an event or existence of a condition which does, or would, with notice or lapse of time or both constitute an event of default under the Senior Creditor Agreements, and in each case specifying such event (such notice a "Payment Block Notice"), Hanover may make, and Junior Creditor may receive and retain from Hanover (i) payments of interest when due as regularly scheduled, and (ii) payment of principal when due at scheduled maturity on August 1, 1998, and (iii) prepayments of principal, plus accrued interest thereon, funded with Borrower has received the proceeds of an not less than $5,000,000 in the form of equity offering of Hanoveror debt from BHC that is subordinated to the Indebtedness on terms acceptable to the Lender in its sole discretion, in each case under clauses (i) the Borrower may commence making all regularly scheduled quarterly principal and (ii) interest payments due in accordance with the terms of the Notes and the Indenture Subordinated Agreement (but not prepayments, redemptions, or payments as in effect a result of acceleration unless prior written consent is provided by Senior Lender), provided that on the date hereof of any proposed payment, (but not any other prepayment i) no Borrower Default has occurred and is continuing or will result from the making of principal or interest or other payment of principal or any payment pursuant to acceleration or claims of breach or any payment to acquire any Junior Debt or otherwise)such payment, and (ivii) reimbursement to Junior Creditor, average Availability for the 30 day period prior to the date of payment after paying all trade payables older than 60 days from invoice date, and paying all book overdrafts and closing costs, is not less than $1,500,000. [remainder of this page intentionally left blank] Acknowledgement and Agreement of Subordinated Creditors Twelfth Amendment To Credit And Security Agreement And Waiver Of Defaults Except as explicitly amended by this Amendment, all of the terms and conditions of each Subordination Agreement shall remain in full force and effect. Dated as of June 2, 2009 /s/ Xxxxxx X. Xxxx XXXXXX X. XXXX, an event individual /s/ Xxxx X. Xxxxxxx XXXX X. XXXXXXX, an individual /s/ Xxx Xxxxxxxxx XXX XXXXXXXXX, an individual Accepted and Agreed: XXXXX FARGO BANK, NATIONAL ASSOCIATION By /s/ Xxxx Xxxxx Name: Xxxx Xxxxx Title: Vice President Acknowledgement and Agreement of default Subordinated Creditors Twelfth Amendment To Credit And Security Agreement And Waiver Of Defaults Exhibit A to Twelfth Amendment to Credit and Security Agreement and Waiver of Defaults REPLACEMENT REVOLVING NOTE $40,000,000 Los Angeles, CA June 2, 2009 For value received, the undersigned, CORSAIR MEMORY, INC., a Delaware corporation (the “Borrower”), hereby promises to pay on the Termination Date under the Credit Agreement (defined below), to the order of XXXXX FARGO BANK, NATIONAL ASSOCIATION (the “Lender”), acting through its Xxxxx Fargo Business Credit operating division, at its office at 000 Xxxxx Xxx Xxxxxx, Suite 700, Pasadena, CA 91101, or at any Junior Debtother place designated at any time by the holder hereof, in lawful money of the United States of America and in immediately available funds, the principal sum of Forty Million Dollars ($40,000,000) or, if less, the aggregate unpaid principal amount of all Revolving Advances made by the Lender to the Borrower under the Credit Agreement (defined below) together with interest on the principal amount hereunder remaining unpaid from time to time, computed on the basis of the actual number of days elapsed and a 360-day year, from the date hereof until this Note is fully paid at the rate from time to time in effect under the Credit and Security Agreement of even date herewith (the “Credit Agreement”) by and between the Lender and the Borrower. The principal hereof and interest accruing thereon shall be due and payable as provided in the Credit Agreement. This Note may be prepaid only in accordance with the Credit Agreement. This Note is issued pursuant, and is subject, to the Credit Agreement, which provides, among other things, for out-of-pocket expenses payable by Hanover acceleration hereof. This Note is the Revolving Note referred to in the Credit Agreement. This Note is secured, among other things, pursuant to the Junior Creditor AgreementsCredit Agreement and the Security Documents as therein defined, and may now or hereafter be secured by one or more other security agreements, mortgages, deeds of trust, assignments or other instruments or agreements. After The Borrower shall pay all costs of collection, including reasonable attorneys’ fees and legal expenses if this Note is not paid when due, whether or not legal proceedings are commenced. Presentment or other demand for payment, notice of dishonor and protest are expressly waived. This Note replaces that certain Replacement Revolving Note(the “Prior Note”), made by Corsair Memory Inc., a Payment Block Notice is givenCalifornia corporation (“Old Borrower”), no payment otherwise permitted predecessor-by merger to be made the Borrower, to or received in respect the order of the Junior Debt may Lender, and continues the Indebtedness evidenced thereby. Nothing herein contained shall be made to construed as a substitution or received by Junior Creditor until the expiration novation of the Standstill Period hereunderobligations of the Borrower outstanding under the Prior Note, which obligations shall remain in full force and no such payment may be made effect, except to the extent that the terms thereof are modified hereby or received after such by the Credit Agreement. CORSAIR MEMORY, INC. By Name: Xxxxxx X. Xxxx Title: President and Chief Executive Officer Exhibit A Exhibit C to Twelfth Amendment to Credit and Security Agreement and Waiver of Defaults COMPLIANCE CERTIFICATE To: Xxxxx Fargo Bank, National Association Date: [ , 200 ] Subject: Financial Statements In accordance with our Credit and Security Agreement dated as of June 10, 2003 (as amended from time to time, the “Credit Agreement”), attached are the financial statements of CORSAIR MEMORY, INC., a Delaware corporation (the “Borrower”) dated , 200 (the “Reporting Date”) and the year-to-date period if a Complete Standstill Event has occurred or shall thereafter occur and while such Complete Standstill Event is continuingthen ended (the “Current Financials”). All terms used in this certificate have the meanings given in the Credit Agreement.

Permitted Payments. Subject to Section 2.4 hereof and the provisions of the Subordination Agreement, so long as (a) Subject to the Borrower is in compliance with all of the other terms and conditions of this Subordination Agreement, Senior Creditor hereby agrees that, unless the Factoring Agreement and until Senior Creditor has notified the Junior Creditor Representative will continue to be in compliance with all of the occurrence terms and conditions of a default the Factoring Agreement after giving effect to any payments of interest or an principal on the Subordinated Debt and (b) no event of default or (as such may be defined in the occurrence of an event or existence of a condition which does, or would, documentation relating to the Obligations) with notice or lapse of time or both constitute an event of default under respect to any Obligations shall have been declared in writing by the Senior Creditor AgreementsLenders and be continuing or would result after giving effect to any payments of interest or principal on the Subordinated Debt, and in each case specifying such event (such notice a "Payment Block Notice"), Hanover then Borrower may make, and Junior Creditor the Noteholder may accept or receive and retain from Hanover (i) the Borrower, payments of interest when due as regularly scheduled, and (ii) payment of principal when due at scheduled maturity on August 1, 1998, and (iii) prepayments of principal, plus accrued interest thereon, funded with the proceeds of an equity offering of Hanover, in each case under clauses (i) and (ii) Subordinated Debt in accordance with the terms of this Note; provided, however, that in the Notes event the Borrower is (x) not in compliance with all of the terms and conditions of the Indenture as Factoring Agreement or would not be in compliance with all of the terms and conditions of the Factoring Agreement after giving effect on the date hereof (but not to any other prepayment such payment of interest or principal or interest or other payment of principal or (y) there shall have been declared in writing by the Senior Lenders and be continuing any payment pursuant to acceleration or claims of breach or any payment to acquire any Junior Debt or otherwise), and (iv) reimbursement to Junior Creditor, prior to an event of default under the Obligations, then all payments on account of the Subordinated Debt shall be suspended until such noncompliance and/or event of default shall have been cured (in the case where a cure period applies), ceased to exist or waived. Notwithstanding the foregoing, in the event there shall have been declared in writing by the Senior Lenders and be continuing any Junior Debtevent of default under the Obligations, for out-of-pocket expenses payable then the Noteholder, at its option, may cure the event of default under the Obligations on behalf of the Borrower, in which case, such amounts paid by Hanover pursuant the Noteholder to the Junior Creditor Agreements. After a Payment Block Notice is given, no payment otherwise permitted Senior Lenders shall be added to be made to or received in respect of the Junior Debt may be made to or received by Junior Creditor until the expiration of the Standstill Period outstanding principal amount due hereunder, and no such payment may be made or received after such period if a Complete Standstill Event has occurred or shall thereafter occur and while such Complete Standstill Event is continuing.

Permitted Payments. The restrictions contained in subsection (a) Subject of ------------------ this Section shall not prohibit, limit or restrict, on or prior to all the other terms and conditions of this Subordination AgreementClosing, Senior Creditor hereby agrees that, unless and until Senior Creditor has notified the Junior Creditor Representative any of the occurrence of a default or an event of default or the occurrence of an event or existence of a condition which does, or would, with notice or lapse of time or both constitute an event of default under the Senior Creditor Agreements, and in each case specifying such event (such notice a "Payment Block Notice"), Hanover may make, and Junior Creditor may receive and retain from Hanover following: (i) payments dividends by a direct or indirect wholly-owned subsidiary of interest when due PGE or PGH II to PGE or PGH II, as regularly scheduledthe case may be, and or another direct or indirect wholly-owned subsidiary of PGE or PGH II, (ii) payment dividends by a less than a wholly-owned subsidiary of principal when due at scheduled maturity on August 1PGE or PGH II consistent with past practice, 1998, and (iii) prepayments of principal, plus accrued interest thereon, funded with dividends on the proceeds of an equity offering of Hanover, in each case under clauses (i) and (ii) in accordance with the terms of the Notes and the Indenture as in effect PGE Preferred Stock outstanding on the date hereof (but not any other prepayment of principal or interest or other payment of principal or any payment pursuant to acceleration or claims of breach or any payment to acquire any Junior Debt or otherwise), and hereof; (iv) reimbursement dividends on, or repurchases of, PGE Common Stock in an amount not to Junior Creditorexceed, in the aggregate, $104.2 million (which amount equals the difference between the net income (as defined below) of PGE for periods prior to an event of default under any Junior DebtJanuary 1, for out-of-pocket expenses payable by Hanover pursuant 2001 and actual dividends paid to the Junior Creditor Agreements. After a Payment Block Notice is given, no payment otherwise permitted to be made to or received Seller in respect of such periods); (v) dividends on, or repurchases of, PGE Common Stock in an aggregate amount not to exceed the Junior Debt may be made aggregate amount of Consolidated Net Income for the period from January 1, 2001 through the Closing Date less any dividends on the PGE Common Stock declared and paid by PGE during the period from January 1, 2001 to the date hereof; (vi) dividends on, or received repurchases of, PGE Common Stock in an aggregate amount equal to the Specified Enron Merger Obligation Payments; (vii) the transactions contemplated by Junior Creditor until Section 7.5(i); (viii) payments by any of PGE, PGH II or their respective subsidiaries to Seller or its Affiliates in respect of intercompany payables or accounts or their liability to Seller on account of PGE or PGH II and their respective subsidiaries being a member or members of Seller's affiliated group for federal income tax purposes and, if applicable, any similar combined or unitary group for state income tax purposes other than any liability arising by virtue of Treasury Regulations ss.1.1502-6 or any similar state provision (the expiration "Tax Sharing Payment"); and (ix) redemptions of the Standstill Period hereunder, and no such payment may be made or received after such period if a Complete Standstill Event has occurred or shall thereafter occur and while such Complete Standstill Event is continuingPGE Preferred Stock pursuant to its terms.

Permitted Payments. (a) Subject to No Loan Party will make, and no holder of Subordinated Indebtedness will accept or receive or retain, any payment of Subordinated Indebtedness until all the other Senior Indebtedness has been indefeasibly paid in full in cash; provided, however, that notwithstanding the foregoing, GFN Mfg may make, and the Subordinated Creditor may accept and retain, scheduled payments (but not prepayments) of principal and interest required to be paid under the Subordinated Note, as and when due and payable to Subordinated Creditor in accordance with, and subject to, the terms and conditions of this Subordination Agreementthe Guaranty, Senior Creditor hereby agrees that, unless and until Senior Creditor has notified the Junior Creditor Representative of the occurrence of a default or an event of default or the occurrence of an event or existence of a condition which does, or would, with notice or lapse of time or both constitute an event of default under the Senior Creditor Agreements, and in each case specifying such event (such notice a "Payment Block Notice"), Hanover may make, and Junior Creditor may receive and retain from Hanover so long as (i) payments no Default or Event of interest when due as regularly scheduledDefault has occurred and is continuing or would result from such payment, (ii) such payment is made from and after the end of the thirteenth completed calendar month following the Closing Date, and (ii) the Borrower has Excess Availability of at least $1,500,000 for each of the thirty (30) days immediately preceding the proposed payment and immediately after giving effect to such payment; provided, further, that if the sole reason that a payment by GFN Mfg is not permitted under this Section 2.7 is due to GFN Mfg’s lack of principal when due at scheduled maturity on August 1Excess Availability, 1998then GFN may make, and (iii) prepayments of principalthe Subordinated Creditor may accept and retain, plus accrued interest thereon, funded with the proceeds of an equity offering of Hanover, in each case under clauses (i) and (ii) in accordance with the terms of the Notes and the Indenture as in effect on the date hereof scheduled payments (but not any other prepayment prepayments) of principal or and interest or other payment of principal or any payment pursuant required to acceleration or claims of breach or any payment be paid under the Subordinated Note, as and when due and payable to acquire any Junior Debt or otherwise)Subordinated Creditor in accordance with, and (iv) reimbursement to Junior Creditorsubject to, prior to an event of default under any Junior Debt, for out-of-pocket expenses payable by Hanover pursuant to the Junior Creditor Agreements. After a Payment Block Notice is given, no payment otherwise permitted to be made to or received in respect terms and conditions of the Junior Debt may be made to Guaranty, so long as no Default or received by Junior Creditor until the expiration Event of the Standstill Period hereunder, and no such payment may be made or received after such period if a Complete Standstill Event Default has occurred and is continuing or shall thereafter occur and while would result from such Complete Standstill Event is continuingpayment.

Permitted Payments. Section 2.1 and Section 2.2 of this Intercreditor Agreement shall not prohibit the payment by the Existing Foreign Borrowing Subsidiaries (a) Subject and, to all the extent not paid by any Existing Foreign Borrowing Subsidiary, the other terms Existing Foreign Subsidiary Guarantors) and conditions the receipt by the Pre-Petition Lenders of this Subordination Agreement, Senior Creditor hereby agrees that, unless and until Senior Creditor has notified the Junior Creditor Representative of the occurrence of a default or an event of default or the occurrence of an event or existence of a condition which does, or would, with notice or lapse of time or both constitute an event of default under the Senior Creditor Agreements, and in each case specifying such event (such notice a "Payment Block Notice"), Hanover may make, and Junior Creditor may receive and retain from Hanover (i) scheduled monthly payments of interest when and letter of credit and other fees, including without limitation, professional fees, due from the Existing Foreign Borrowing Subsidiaries under the Pre-Petition Credit Agreement in the manner and to the extent set forth in Section 4 of the Standstill Agreement and in the Orders so long as regularly scheduled, (other than in the case of professional fees) no Default or Event of Default has occurred and is continuing (ii) payment of principal when due at scheduled maturity on August 1, 1998, and (iii) prepayments of principal, plus accrued interest thereon, funded with the proceeds of an equity offering of Hanover, in each case under clauses (ior would result after giving effect to any such payments) and the Pre-Petition Agent has received notice (iiwhich need not be in writing) of such Default or Event of Default; provided that under no circumstances shall the Subordination Fee be payable to the Pre-Petition Lenders until the DIP Lender Claims have been paid in full. Nothing contained in this Agreement is intended to or shall impair, as among the Existing Foreign Subsidiaries and the Pre-Petition Lenders, the obligation of the Existing Foreign Subsidiaries, which is absolute and unconditional, to pay to the Pre-Petition Lenders the Pre-Petition Lender Claims as and when the same shall become due and payable in accordance with the terms thereof, or is intended to or shall affect the relative rights of the Notes Pre-Petition Lenders and creditors of the Existing Foreign Subsidiaries other than the DIP Lenders, nor shall anything herein prevent the Pre-Petition Lenders from exercising all remedies otherwise permitted by applicable law upon default, subject in each case to the rights, if any, of the DIP Lenders set forth herein and the Indenture as in effect Standstill Agreement. The failure to make a payment on account of principal of, premium, if any, or interest on the date hereof (but Pre-Petition Lender Claims by reason of any provision of this Agreement will not any other prepayment be construed as preventing the occurrence of principal or interest or other payment of principal or any payment pursuant to acceleration or claims of breach or any payment to acquire any Junior Debt or otherwise), and (iv) reimbursement to Junior Creditor, prior to an event of default a Standstill Event under any Junior Debt, for out-of-pocket expenses payable by Hanover pursuant to the Junior Creditor Agreements. After a Payment Block Notice is given, no payment otherwise permitted to be made to or received in respect of the Junior Debt may be made to or received by Junior Creditor until the expiration of the Standstill Period hereunder, and no such payment may be made or received after such period if a Complete Standstill Event has occurred or shall thereafter occur and while such Complete Standstill Event is continuingAgreement.

Permitted Payments. (a) Subject to all the other terms and conditions of this Subordination Agreementhereof, Senior Creditor hereby agrees that, unless and until Senior Creditor has notified the Junior Creditor Representative of the occurrence of a default or an event of default or the occurrence of an event or existence of a condition which does, or would, with notice or lapse of time or both constitute an event of default under the Senior Creditor Agreements, and in each case specifying such event (such notice a "Payment Block Notice"), Hanover may make, and Junior Creditor may receive and retain from Hanover CBI shall be permitted to make (i) regularly scheduled payments of principal and interest when due and payable under the terms of the Loan Agreement between Castle Brands Inc. and the lending parties named therein dated on or about August 7, 2013 (the “CBI August 2013 Subordinated Loan Agreement”) and the Promissory Notes dated on or about August 7, 2013 in an aggregate original principal amount equal to One Million Two Hundred Fifty Thousand and 00/100 Dollars ($1,250,000.00) issued by CBI (“CBI August 2013 Subordinated Notes”) to the lending parties named therein (collectively, the “CBI August 2013 Subordinated Noteholders”) and such other agreements, documents and instruments executed and/or delivered to the CBI August 2013 Subordinated Noteholders in connection therewith (all such agreements, documents and instruments, together with any amendments, restatements, extensions or other modifications made from time to time, shall be collectively referred to herein as regularly scheduledthe “CBI August 2013 Subordinated Loan Documents”), as the CBI August 2013 Subordinated Loan Documents are in effect on the date hereof, and voluntary prepayments of principal and interest permitted under the terms of the CBI August 2013 Subordinated Loan Documents as the CBI August 2013 Subordinated Loan Documents are in effect on the date hereof, but not any mandatory, voluntary, discretionary or optional payment, distribution, or other amount in repayment or prepayment of the CBI August 2013 Subordinated Notes or under the CBI August 2013 Subordinated Loan Documents, whether required or permitted pursuant to the terms of the CBI August 2013 Subordinated Loan Documents, due to the acceleration of maturity of the CBI August 2013 Subordinated Notes, in whole or in part, or any other CBI August 2013 Subordinated Loan Document, in whole or in part, for any reason, and (ii) payment regularly scheduled payments of principal when interest due at scheduled maturity on August 1, 1998, and (iii) prepayments of principal, plus accrued interest thereon, funded with the proceeds of an equity offering of Hanover, in each case payable under clauses (i) and (ii) in accordance with the terms of the Castle Brands Inc. 5% Subordinated Convertible Notes due 2018 Purchase Agreement dated on or about October 21, 2013 (the “2018 Subordinated Notes Purchase Agreement”), the Castle Brands Inc. 5% Subordinated Convertible Notes due 2018 dated on or about October 21, 2013 (collectively, the “2018 Subordinated Notes”) and issued to the “Purchasers” (the “2018 Subordinated Noteholders”) executing the 2018 Subordinated Notes Purchase Agreement, and the Indenture other agreements, documents and instruments executed and/or delivered to CBI in connection therewith (all such agreements, documents and instruments, together with any amendments, restatements, extensions or other modifications made from time to time, shall be collectively referred to herein as the, the “2018 Subordinated Debt Documents”), as the 2018 Subordinated Debt Documents are in effect on the date hereof (hereof, but not any mandatory, voluntary, discretionary or optional payment, distribution, or other amount in repayment or prepayment of principal the 2018 Subordinated Notes or interest under the 2018 Subordinated Debt Documents, whether required or other payment of principal or any payment pursuant to acceleration or claims of breach or any payment to acquire any Junior Debt or otherwise), and (iv) reimbursement to Junior Creditor, prior to an event of default under any Junior Debt, for out-of-pocket expenses payable by Hanover permitted pursuant to the terms of the 2018 Subordinated Debt Documents, due to the acceleration of maturity of 2018 Subordinated Notes, in whole or in part, or any other 2018 Subordinated Debt Document, in whole or in part, for any reason. For purposes of this Agreement the CBI August 2013 Subordinated Noteholders and the 2018 Subordinated Noteholders shall be collectively referred to as the “Junior Creditors”, the CBI August 2013 Subordinated Loan Documents and the 2018 Subordinated Debt Documents shall be referred to as the “Junior Creditor Agreements. After Loan Documents”, each payment permitted pursuant to the provisions of this Section 8.6(a) shall be referred to as a Payment Block Notice is given“Permitted Payment”, no payment otherwise permitted to be made to and any amendment, modification, restatement, extension or received in respect replacement of the Junior Debt may be made to or received by any Junior Creditor until Loan Document after the expiration date of the Standstill Period hereunder, and no such payment may this Agreement shall be made or received after such period if a Complete Standstill Event has occurred or shall thereafter occur and while such Complete Standstill Event is continuingdisregarded for purposes of determining Permitted Payments.

Permitted Payments. Notwithstanding anything contained in Section 1 to the contrary, Subordinated Noteholders may receive, and Company may pay, the following payments in respect to the Subordinated Notes: (a) Subject an initial aggregate payment in an amount not to all exceed $3,000,000 (such exact amount to be determined by Agent and based on Excess Availability (as defined in the other terms and conditions of this Subordination Loan Agreement, Senior Creditor hereby agrees that, unless and until Senior Creditor has notified ) being at least $4,000,000 after giving effect to such initial aggregate payment) from the Junior Creditor Representative proceeds of the occurrence of a default or an event of default or the occurrence of an event or existence of a condition which does, or would, with notice or lapse of time or both constitute an event of default initial loans under the Senior Creditor AgreementsLoan Agreement to be applied to accrued interest and principal in respect of the Subordinated Notes; and (b) at any time during the period after the later of March 1, 2003 and Agent’s receipt of Company’s December 31, 2002 audited financial statements certified by its independent certified public accountants and prior to May 1, 2003, additional payments to be applied to accrued interest and principal in each case specifying such event (such notice a "Payment Block Notice"), Hanover may make, and Junior Creditor may receive and retain from Hanover respect of the Subordinated Notes so long as (i) payments after giving effect for such payment, no Event of interest when due Default (as regularly scheduleddefined in the Loan Agreement) exists or would be caused thereby, and (ii) payment of principal when due after giving effect to such payment, Excess Availability (as defined in the Loan Agreement) (calculated without deducting the Availability Block (as defined in the Loan Agreement)) is at scheduled maturity on August 1least $4,000,000, 1998, and (iii) prepayments of principal, plus accrued interest thereon, funded with Excess Availability (calculated without deducting the proceeds of an equity offering of Hanover, in Availability Block) is at least $4,000,000 for each case under clauses (i) and (ii) in accordance with the terms of the Notes and the Indenture as in effect on the date hereof thirty (but not any other prepayment of principal or interest or other payment of principal or any payment pursuant to acceleration or claims of breach or any payment to acquire any Junior Debt or otherwise)30) days following such payment, and (iv) reimbursement to Junior Creditor, at least thirty (30) days prior to an event making such payment, Agent shall have received Company’s projections, in form and substance satisfactory to Agent, demonstrating that Company will have satisfactory (as determined by Agent) capitalization, liquidity and availability for the twelve (12) month period following such payment (collectively, the payments under (a) and (b), the “Permitted Payments”). Except as contemplated by Section 17 below, Company and Creditors hereby agree and understand that the terms of default under any Junior the Subordinated Debt, for out-of-pocket expenses payable by Hanover pursuant the Subordinated Notes and the Series B Collateral Documents may not be modified or amended without Agent’s prior written consent. Notwithstanding anything contained in this Section 2 to the Junior Creditor Agreements. After a Payment Block Notice is givencontrary, no payment otherwise permitted to be made to or received in respect the aggregate outstanding principal balance of the Junior Debt may Subordinated Notes shall not at any time be made less than $1,000. Company acknowledges and agrees that the failure to or received by Junior Creditor until maintain Excess Availability of at least $4,000,000 at all times during the expiration 30 day period following a payment under clause (b) above shall constitute an Event of the Standstill Period hereunder, and no such payment may be made or received after such period if a Complete Standstill Event has occurred or shall thereafter occur and while such Complete Standstill Event is continuingDefault.

Permitted Payments. (a) Subject Notwithstanding anything to all the other terms contrary contained in Section 3.1 hereof, Debtors may make and conditions of this Subordination Agreement, Senior Creditor hereby agrees that, unless and until Senior Creditor has notified the Junior Creditor Representative of the occurrence of a default or an event of default or the occurrence of an event or existence of a condition which does, or would, with notice or lapse of time or both constitute an event of default under the Senior Creditor Agreements, and in each case specifying such event (such notice a "Payment Block Notice"), Hanover may make, and Junior Creditor Supplemental Loan Lenders may receive and retain from Hanover Debtors: (ia) regularly scheduled payments of interest when due as regularly scheduled, and (ii) payment of principal when due at scheduled maturity on August 1, 1998, and (iii) prepayments of principal, plus accrued interest thereonand fees, funded with the proceeds of an equity offering of Hanoverif any, in each case under clauses (i) and (ii) respect of the Supplemental Loan Debt in accordance with the terms of the Notes and the Indenture Supplemental Loan Agreement as in effect on the date hereof hereof; (but b) optional prepayments of Supplemental Loan Debt in accordance with the terms of the Supplemental Loan Agreement; provided that, Borrowers may not repay any other prepayment Reborrowable Loans (as defined in the Supplemental Loan Agreement) unless (i) no Default or Event of principal or interest or other payment Default shall have occurred and be continuing prior to, and after giving effect to, such repayment, (ii) the aggregate amount of principal or Reborrowable Loans so repaid prior to the Six Month Termination Date (as defined in the Supplemental Loan Agreement) shall not exceed the amount by which the Borrowers have reduced the aggregate face amount of all Letters of Credit outstanding under the Revolving Loan Agreement as of the Closing Date (as defined in the Revolving Loan Agreement, (iii) after giving effect to any payment pursuant to acceleration or claims such repayment, the outstanding amount of breach or any payment to acquire any Junior Debt or otherwise)Loans under the Supplemental Real Estate Facility shall equal at least $10,000,000, and (iv) reimbursement after giving effect to Junior Creditorany such repayment, prior Excess Revolver Availability (as defined in the Revolving Loan Agreement) is equal to an event at least $28,000,000; and provided, further, that Borrowers may not prepay Supplemental Loan Debt unless both before and after giving effect to such prepayment, average daily Excess Revolver Availability (as defined in the Revolving Loan Agreement) for the thirty (30) day period immediately preceding such payment, and immediately on the day after such payment, equals at least $65,000,000 on a pro forma basis after giving effect to such proposed payment; (c) mandatory prepayments of default under any Junior Debtprincipal, for out-of-pocket expenses payable by Hanover pursuant to the Junior Creditor Agreements. After a Payment Block Notice is giveninterest and fees, no payment otherwise permitted to be made to or received if any, in respect of the Junior Supplemental Loan Debt may be made to with the net cash proceeds from the sale or received by Junior Creditor until other disposition of Supplemental Loan Priority Collateral as set forth in Section 2.8 hereof; and (d) prepayments of principal, interest and fees, if any, from the expiration proceeds of Collateral after the payment in full of the Standstill Period hereunder, and no such payment may be made or received after such period if a Complete Standstill Event has occurred or shall thereafter occur and while such Complete Standstill Event is continuingRevolving Loan Debt (other than the Term Loan as defined under the Revolving Loan Agreement).

Permitted Payments. (a) Subject Notwithstanding anything to all the other terms and conditions of this Subordination Agreementcontrary set forth herein, Senior Creditor hereby agrees that, unless and until Senior Creditor has notified the Junior Creditor Representative of the occurrence of a default or an event of default or the occurrence of an event or existence of a condition which does, or would, with notice or lapse of time or both constitute an event of default under the Senior Creditor Agreements, and in each case specifying such event (such notice a "Payment Block Notice"), Hanover may make, and Junior Creditor may receive and retain from Hanover so long as (i) payments of interest when due as regularly scheduledno Payment Default exists, and (ii) payment of principal when due at scheduled maturity on August 1, 1998no Blockage Period shall be continuing, and (iii) prepayments no Event of principalDefault shall result from the making of such payment, plus accrued ARC may pay or cause to be paid to Wynnchurch and any other Subordinated Creditor, and Wynnchurch and any other Subordinated Creditor may accept and retain regularly scheduled quarterly payments of interest thereon, funded with the proceeds of an equity offering of Hanover, but no principal in each case under clauses (i) and (ii) in accordance with the terms respect of the Subordinated Notes on the dates and in the Indenture amounts provided for in the Subordinated Notes (as in effect on the date hereof (but not any other prepayment hereof); provided that so long as the FCC Senior Credit Agreement shall remain in effect in no event shall the aggregate amount of principal or interest or other payment of principal or any payment pursuant to acceleration or claims of breach or any payment to acquire any Junior Debt or otherwise), and (iv) reimbursement to Junior Creditor, prior to an event of default under any Junior Debt, for out-of-pocket expenses payable by Hanover pursuant to the Junior Creditor Agreements. After a Payment Block Notice is given, no payment otherwise permitted to be payments made to or received in respect of the Junior Debt may be made to or received by Junior Creditor until Subordinated Notes during any calendar quarter beginning with the expiration calendar quarter beginning January 1, 2002 and ending with the calendar quarter ending December 31, 2005 exceed 1.875% of the Standstill outstanding principal balance of the Subordinated Notes without the prior written consent of the Senior Creditor, except that if (A) the Senior Creditor has received a Compliance Certificate indicating that the Borrowers are in compliance with Section 8.10(b) of the FCC Senior Credit Agreement for the period from January 1, 2002 through June 30, 2002 or any other two consecutive fiscal quarters following the Effective Time, (B) no Payment Default exists, (C) no Blockage Period hereundershall have commenced and be continuing, (D) no Event of Default shall result from the making of such payment, and (E) prior to such payment, the Borrowers shall have delivered evidence to the Senior Creditor that after giving effect to such payment, Excess Availability (as defined in the Senior Credit Agreement) shall equal or exceed $5,000,000, the aggregate amount of interest payments made in respect of the Subordinated Notes during any calendar quarter may total up to (x) 4.50% of the outstanding principal balance of the Subordinated Notes PLUS (y) the amount of prior interest payments that were not paid as a result of the prior existence of a Payment Default or prior commencement of a Blockage Period. Notwithstanding anything to the contrary set forth herein, beginning with the calendar quarter beginning January 1, 2006, so long as no Payment Default exists, no Blockage Period shall have commenced and be continuing, and no Event of Default shall result from the making of such payment, ARC may pay or cause to be paid to Wynnchurch and any other Subordinated Creditor, and Wynnchurch and any other Subordinated Creditors may accept and retain, scheduled quarterly payments of interest but no principal in respect of the Subordinated Notes on the dates and in the amounts provided for in the Subordinated Notes (as in effect on the date hereof). If Wynnchurch or any other holder of the Subordinated Indebtedness receives payment from the Borrowers pursuant to the first sentence of this Section 2.6(a), such payment may shall be made deemed to constitute a representation of the Borrowers to the Senior Creditor and to the Subordinated Creditors that no Event of Default exists, and that such payment is permitted to be paid by the Borrowers under this Agreement; and the Subordinated Creditors shall be entitled to keep and retain such payment unless prior to the Subordinated Creditors' receipt of such payment there shall occur a Payment Default or received after the Senior Creditor shall have sent a Blockage Notice to the Subordinated Creditors, in which case the Subordinated Creditors shall forthwith deliver such payment or an amount of cash equal thereto to the Senior Creditor for application in payment of the Senior Obligations. Notwithstanding anything to the contrary set forth herein, the Senior Creditor shall not be entitled to block payments pursuant to the delivery of Blockage Notices hereunder for more than 180 days during any 360 day period if a Complete Standstill Event has occurred or shall thereafter occur and while such Complete Standstill Event is continuingcommence more than three Blockage Periods during the term of this Agreement.

Permitted Payments. (a) Subject Until such time as the Senior Debt is paid and performed in full and the Senior Lenders have no further commitments to all the other terms and conditions of this Subordination Agreement, Senior Creditor hereby agrees that, unless and until Senior Creditor has notified the Junior Creditor Representative of the occurrence of a default or an event of default or the occurrence of an event or existence of a condition which does, or would, with notice or lapse of time or both constitute an event of default extend credit to Borrower under the Senior Documents, Subordinated Creditor Agreementsshall not receive or accept any payment from Borrower or any Guarantor with respect to the Subordinated Obligation without the prior written consent of Senior Agent; provided that, so long as Senior Agent has not delivered written notice to each of the Borrower and the Subordinated Creditor (a "BLOCKAGE NOTICE") that a "Default", "Potential Default", or Borrowing Base Deficiency (as each such term is defined in the Credit Agreement) exists (or would arise after giving effect to any such payment) under the Senior Debt or under the Senior Documents, Borrower may pay, and in each case specifying such event (such notice a "Payment Block Notice"), Hanover may make, and Junior Subordinated Creditor may receive and retain from Hanover accept (i) payments consisting of accrued and unpaid interest when due as regularly scheduled, and owed under the Subordinated Loan Agreement (the "ACCRUED SUBORDINATED INTEREST"); (ii) payment of principal when due at scheduled maturity payments on August 1, 1998any outstanding loans made by Subordinated Creditor under the Subordinated Loan Agreement in an amount up to, and as a direct offset against, the sale price owed by Subordinated Creditor to Borrower for any Option Interest in the Potash Field (contemplated to be acquired by Borrower from Greka Energy, Inc.) in Plaquemines Parish, Louisiana if the closing of such acquisition by the Borrower is upon terms and conditions consistent with those previously disclosed to Senior Agent and occurs before April 30, 2002; (iii) prepayments principal payments on any outstanding loans made by Subordinated Creditor under the Subordinated Loan Agreement to finance the acquisition by Borrower of principaloil and gas properties in the State of Louisiana solely in an amount up to, plus accrued interest thereonand as a direct offset against, funded with the proceeds sale price owed by Subordinated Creditor to Borrower for any sale to Subordinated Creditor of an equity offering Option Interest in such oil and gas properties which is consummated within ten (10) days of Hanoversuch acquisition by Borrower; and (iv) other payments of principal on any outstanding loans made by Subordinated Creditor under the Subordinated Loan Agreement (including, without limitation, any such payments made or deemed made in respect of the sale by Borrower of any Option Interests to Subordinated Creditor) so long as, in each the case under clauses of this clause (i) and iv), the "Committed Usage" (ii) as such term is defined in accordance with the terms of the Notes and the Indenture Credit Agreement as in effect on the date hereof hereof) does not exceed (but or would not exceed after giving effect to any other prepayment of such principal or interest or other payment of principal or any payment pursuant to acceleration or claims of breach or any payment to acquire any Junior Debt or otherwise), and payment) eighty percent (iv80%) reimbursement to Junior Creditor, prior to an event of default under any Junior Debt, for out-of-pocket expenses payable by Hanover pursuant to the Junior Creditor Agreements. After a Payment Block Notice is given, no payment otherwise permitted to be made to or received in respect of the Junior Debt may be made to or received by Junior Creditor until the expiration lesser of the Standstill Period hereunder, and no "Commitments" or the then current "Borrowing Base" (as each of such payment may be made or received after such period if a Complete Standstill Event has occurred or shall thereafter occur and while such Complete Standstill Event is continuing.terms is

Permitted Payments. (a) Subject to all Notwithstanding the other terms of Section 3 hereinabove, from and conditions of this Subordination Agreement, after such time as the Senior Creditor hereby agrees that, unless and until Senior Creditor Lender has notified the Junior Subordinated Creditor Representative in writing that, after the effective date of the occurrence of a default or an event of default or Eleventh Amendment, the occurrence of an event or existence of a condition which does, or would, with notice or lapse of time or both constitute an event of default under the Senior Creditor Agreements, and in each case specifying such event (such notice a "Payment Block Notice"), Hanover may make, and Junior Creditor may receive and retain from Hanover (i) payments of interest when due as regularly scheduled, and (ii) payment of principal when due at scheduled maturity on August 1, 1998, and (iii) prepayments of principal, plus accrued interest thereon, funded with Borrower has received the proceeds of an not less than $5,000,000 in the form of equity offering of Hanoveror debt that is subordinated to the Indebtedness on terms acceptable to the Lender in its sole discretion, in each case under clauses (i) the Borrower may commence making all regularly scheduled quarterly principal and (ii) interest payments due in accordance with the terms of the Notes and the Indenture Subordinated Agreement (but not prepayments, redemptions, or payments as in effect a result of acceleration unless prior written consent is provided by Senior Lender), provided that on the date hereof (but not of any other prepayment proposed payment, no Borrower Default has occurred and is continuing or will result from the making of principal such payment. Upon written notice given to the Subordinated Creditor from the Senior Lender or interest or other payment of principal or any payment pursuant to acceleration or claims of breach or any payment to acquire any Junior Debt or otherwise)its representative that a Borrower Default has occurred, and (iv) reimbursement to Junior Creditor, prior to an event of default under any Junior Debt, for out-of-pocket expenses payable by Hanover pursuant until the Senior Lender has given written notice to the Junior Subordinated Creditor Agreements. After a Payment Block Notice is giventhat such Borrower Default has been cured or waived, no payment otherwise permitted to be made to or received Borrower may not make any payments in respect of the Junior Debt may be made to or received Subordinated Agreement whatsoever. Except as explicitly amended by Junior Creditor until the expiration this Amendment, all of the Standstill Period hereunderterms and conditions of the Subordination Agreement shall remain in full force and effect. Acknowledgement and Agreement of Subordinated Creditors Eleventh Amendment To Credit And Security Agreement And Waiver Of Defaults Dated as of June 27, 2008 /s/ Xxxxxx X. Xxxx XXXXXX X. XXXX, an individual /s/ Xxxx X. Xxxxxxx XXXX X. XXXXXXX, an individual /s/ Xxx Xxxxxxxxx XXX XXXXXXXXX, an individual /s/ Xxxx X. Xxxxx XXXX X. XXXXX, an individual Accepted and no such payment may be made or received after such period if a Complete Standstill Event has occurred or shall thereafter occur Agreed: XXXXX FARGO BANK, NATIONAL ASSOCIATION By /s/ Edit Kondorosi Name: Edit Kondorosi Title: Vice President CORSAIR MEMORY, INC. By /s/ Xxxxxx X. Xxxx Name: Xxxxxx X. Xxxx Title: President and while such Complete Standstill Event is continuing.Chief Executive Officer Acknowledgement and Agreement of Subordinated Creditors Eleventh Amendment To Credit And Security Agreement And Waiver Of Defaults

Permitted Payments. (a) Subject Unless permitted under Section 11(h) hereunder or otherwise consented to all the other terms and conditions of this Subordination Agreement, Senior Creditor hereby agrees that, unless and until Senior Creditor has notified the Junior Creditor Representative of the occurrence of a default or an event of default or the occurrence of an event or existence of a condition which does, or would, with notice or lapse of time or both constitute an event of default under by the Senior Creditor AgreementsLenders, and in each case specifying such event (such notice a "Payment Block Notice"), Hanover may make, and Junior Creditor may receive and retain the Subordinated Lender shall not accept from Hanover (i) Obligors any cash payments of interest when due as regularly scheduled, and (ii) payment of principal when due at scheduled maturity on August 1, 1998, and (iii) prepayments of principal, plus accrued interest thereon, funded with the proceeds of an equity offering of Hanover, in each case under clauses (i) and (ii) in accordance with the terms or fees on account of the Notes Subordinated Obligations, but may accrue and capitalize interest, fees and expenses on the Indenture Subordinated Obligations as permitted under the provisions of the Subordinated Note as in effect on the date hereof (but not hereof. Nothing in this Agreement shall be deemed to authorize the making of any other prepayment such payments by any of principal or interest or other payment of principal the Obligors or any payment pursuant to acceleration or claims of breach or any payment to acquire any Junior Debt or otherwise), and (iv) reimbursement to Junior Creditor, prior to an event of default under any Junior Debt, for out-of-pocket expenses payable by Hanover Subsidiary thereof not otherwise permitted pursuant to the Junior Creditor Agreementsterms of the Senior Loan Documents. After a Payment Block Notice is givenOther than as expressly set forth in Sections 3(a) and 11(h), no payment otherwise permitted to payments, proceeds or distributions shall be made to by any Obligor or any Subsidiary thereof or accepted by the Subordinated Lender on account of the Subordinated Obligations until after the Termination Date, whether or not any Insolvency Proceeding has been commenced by or against any Obligor, and any payment, proceeds or distributions made by an Obligor or received in respect (including by set-off, recoupment, as the proceeds of any Collateral or any other manner) by the Subordinated Lender other than as expressly permitted above shall be deemed the property of the Junior Debt may Senior Agent and the Senior Lenders, shall be made segregated by the Subordinated Lender and be deemed to or have been received by Junior Creditor and held by the Subordinated Lender in trust for the Senior Agent and the Senior Lenders, and shall be turned over by the Subordinated Lender as soon as practical to the Senior Agent in the identical form received (with any necessary endorsements) for distribution to the Senior Lenders in accordance with the Senior Loan Documents. Senior Agent is hereby authorized to make any such endorsements as agent for the Subordinated Lender. This authorization is coupled with an interest and is irrevocable until the expiration of the Standstill Period hereunder, and no such payment may be made or received after such period if a Complete Standstill Event has occurred or shall thereafter occur and while such Complete Standstill Event is continuingTermination Date.

Permitted Payments. (a) Subject to all the other terms and conditions of this Subordination Agreement, Senior Creditor hereby agrees that, unless and until Senior Creditor has notified the Junior Creditor Representative of the occurrence of a default or an event of default or the occurrence of an event or existence of a condition which does, or would, with notice or lapse of time or both constitute an event of default under the Senior Creditor Agreements, and in each case specifying such event (such notice a "Payment Block Notice"), Hanover may make, and Junior Creditor may receive and retain a)The Subordinated Lender shall not accept from Hanover (i) Obligors any payments of interest when due as regularly scheduled, and (ii) payment of principal when due at scheduled maturity on August 1, 1998, and (iii) prepayments of principal, plus accrued interest thereoninterest, funded with fees on the proceeds of an equity offering of HanoverSubordinated Obligations or any other amount owed by any Obligor to the Subordinated Lender, in each case under clauses (i) but may accrue and (ii) capitalize interest, fees and expenses on the Subordinated Obligations in accordance with the terms provisions of the Notes and the Indenture Subordinated Credit Agreement as in effect on the date hereof hereof, provided that upon the payment in full of all the Senior Obligations, the Obligors may make regularly scheduled interest payments in cash to the Subordinated Lender. Other than as expressly set forth immediately above in this Section 3(a), no payments, proceeds or distributions shall be made by any Obligor or any Subsidiary thereof or accepted by the Subordinated Lender on the Subordinated Obligations until after the date that is 181 days after the Senior Termination Date, and any payment, proceeds or distributions made by an Obligor or received (but not including by set-off, recoupment, as the proceeds of any Collateral or any other prepayment manner) by the Subordinated Lender other than as expressly permitted above shall be deemed the property of principal or interest or the Senior Agent and the other payment of principal or any payment pursuant Senior Creditors, shall be segregated by the Subordinated Lender and be deemed to acceleration or claims of breach or any payment to acquire any Junior Debt or otherwise)have been received by and held by the Subordinated Lender in trust for the Senior Agent and the other Senior Creditors, and (iv) reimbursement to Junior Creditor, prior to an event of default under any Junior Debt, for out-of-pocket expenses payable shall be turned over by Hanover pursuant the Subordinated Lender as soon as practical to the Junior Creditor Agreements. After a Payment Block Notice is given, no payment otherwise permitted Senior Agent in the identical form received (with any necessary endorsements) for distribution to be made to or received the Senior Creditors in respect of accordance with the Junior Debt may be made to or received by Junior Creditor until the expiration of the Standstill Period hereunder, and no such payment may be made or received after such period if a Complete Standstill Event has occurred or shall thereafter occur and while such Complete Standstill Event is continuingSenior Transaction Documents.

Permitted Payments. (a) Subject to all the other terms and conditions last sentence of this Subordination Agreement, Senior Creditor hereby agrees that, unless and until Senior Creditor has notified the Junior Creditor Representative of the occurrence of a default or an event of default or the occurrence of an event or existence of a condition which does, or wouldSection 2.2(a), with notice or lapse of time or both constitute an event of default under respect to the Senior Creditor AgreementsSubordinated Debt, and in each case specifying such event (such notice a "Payment Block Notice"), Hanover may Issuer shall be permitted to make, and Junior Subordinated Creditor may shall be permitted to receive and retain from Hanover retain, only the following payments (ithe “Permitted Payments”): following the Permitted Payments Date, (x) payments of accrued interest (at a non-default rate) owed on the Subordinated Debt, when due as due, (y) regularly scheduled, scheduled payments of principal owing under the Subordinated Note on a non-accelerated basis and (ii) payment of principal when due at scheduled maturity on August 1, 1998, and (iiiz) prepayments of principal, plus accrued interest thereon, funded with to the proceeds of an equity offering of Hanover, in each case under clauses (i) and (ii) Subordinated Creditor in accordance with the terms of Section 8 of the Notes and the Indenture as in effect on the date hereof (but Subordinated Note; provided, for avoidance of doubt, that Issuer shall not any other prepayment of principal or interest or other payment of principal or any payment pursuant be permitted to acceleration or claims of breach or any payment to acquire any Junior Debt or otherwise)make, and (iv) reimbursement Subordinated Creditor shall not be permitted to Junior Creditorreceive or retain, directly or indirectly, any payments of any kind in respect of the Subordinated Debt at any time prior to an event the Permitted Payments Date, without the prior consent of default under any Junior Debt, for out-of-pocket expenses payable by Hanover pursuant to the Junior Creditor AgreementsSenior Creditor. After a Payment Block Notice is givenNotwithstanding the foregoing, no payment otherwise Permitted Payment shall be permitted to be made by Issuer or any of its Subsidiaries or retained by Subordinated Creditor to the extent such Permitted Payment would be made by Issuer or any of its Subsidiaries or received by Subordinated Creditor from and after the date on which notice of a Senior Default Notice is given in respect accordance with Section 4.8 ; provided, however, that, if Issuer or any of the Junior Debt its Subsidiaries and Subordinated Creditor shall have received a Senior Default Notice, Permitted Payments may be made to by Issuer or received any of its Subsidiaries and retained by Junior Subordinated Creditor until on and after the expiration date of the Standstill Period hereunder, and no earliest to occur of: (i) the day on which the Senior Default that is the subject of such Senior Default Notice is cured or waived by Senior Creditor or (ii) payment may be made or received after such period if a Complete Standstill Event has occurred or shall thereafter occur and while such Complete Standstill Event is continuingin full in cash of the Senior Debt.