Exhibit 10.1

FINAL EXECUTON COPY

THIS SENIOR SUBORDINATED CONVERTIBLE LOAN AND SECURITY AGREEMENT AND THE INDEBTEDNESS EVIDENCED HEREBY ARE SUBORDINATED IN THE MANNER AND TO THE EXTENT SET FORTH IN THAT CERTAIN SUBORDINATION AGREEMENT OF EVEN DATE HEREWITH AMONG MIDCAP BUSINESS CREDIT LLC, THE LENDERS, AND ROBERT J. PALLÉ, AS AGENT FOR THE LENDERS (AS AMENDED, RESTATED, SUPPLEMENTED OR OTHERWISE MODIFIED AND IN EFFECT FROM TIME TO TIME, THE “SUBORDINATION AGREEMENT”) AND EACH LENDER, BY ITS ACCEPTANCE HEREOF, SHALL BE BOUND BY THE PROVISIONS OF THE SUBORDINATION AGREEMENT.

SENIOR SUBORDINATED CONVERTIBLE LOAN AND SECURITY AGREEMENT

THIS SENIOR SUBORDINATED CONVERTIBLE LOAN AND SECURITY AGREEMENT (this “Agreement”) is made and entered into as of the 8th day of April, 2020 by and between Blonder Tongue Laboratories, Inc., a Delaware corporation (the “Company”), Livewire Ventures, LLC, a Florida limited liability company (“Livewire”), MidAtlantic IRA, LLC FBO Steven L. Shea IRA (“Shea”), Carol M. Pallé and Robert J. Pallé (jointly and severally, “Pallé”), Anthony J. Bruno (“Bruno”), Stephen K. Necessary (“Necessary”), and such other Persons who may from time to time become party hereto as lenders (collectively, the “Lenders”), and Robert J. Pallé, as agent for the Lenders (in such capacity, the “Agent”).

BACKGROUND

A. The Company has requested that the Lenders extend a certain credit facility to the Company which the Lenders are willing to do on the terms set forth herein.

B. Capitalized terms used herein will have the meanings set forth therefor in Section 1 of this Agreement.

NOW, THEREFORE, in consideration of the terms and conditions contained herein, and of any extensions of credit now or hereafter made to or for the benefit of the Company by Lender, the parties hereto, intending to be legally bound hereby, agree as follows:

1. DEFINITIONS.

1.1 Defined Terms. The following words and phrases as used in capitalized form in this Agreement, whether in the singular or plural, shall have the meanings indicated:

(a) “Accreted Principal Amount” means, at any time, the outstanding principal amount of the Term Loan, including the aggregate amount of all Advances as well as all PIK Interest added thereto.

(b) “Advance” means any extension of credit by the Lenders (or any of them) to the Company under Section 2.1 of this Agreement.

(c) “Advance Request” shall be as defined in Section 2.3.

(d) “Affiliate” as to any Person, means (i) each other Person that directly or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, the Person in question and (ii) any person who is an officer, director, member, manager or partner of (A) such Person, (B) any Subsidiary of such Person, or (C) any Person described in the preceding clause (i).

(e) “Agent” means Robert J. Pallé, in his capacity as Agent hereunder for the Lenders or any successor thereto chosen by the Required Lenders.

(f) “Aggregate Tranche A Commitments” means, at any time, the combined Tranche A Commitments of all Tranche A Lenders, all as more particularly set forth on Schedule 1.1 hereof.

(g) “Aggregate Tranche B Commitments” means, at any time, the combined Tranche B Commitments of all Tranche B Lenders, all as more particularly set forth on Schedule 1.1 hereof, as the same may be amended upon the joinder hereto of Tranche B Lenders.

(h) “Aggregate Tranche C Commitments” means, at any time, the combined Tranche C Commitments of all Tranche C Lenders, all as more particularly set forth on Schedule 1.1 hereof, as the same may be amended upon the joinder hereto of Tranche C Lenders.

(i) “Basic Interest Rate” shall be as defined in Section 3.1.

(j) “Business Day” means any day except a Saturday, Sunday or other day on which money center commercial banks located in New York, New York are authorized by law to close.

(k) “Cash Interest” shall be as defined in Section 4.1.

(l) “Collateral” shall be as defined in Section 5.3.

(m) “Commitment” means, as to each Lender as of any date of determination, such Lender’s Tranche A Commitment, Tranche B Commitment or Tranche C Commitment.

(n) “Commitment Percentage” means, as to each Lender, a fractional amount expressed as a percentage, the numerator of which is the amount of such Lender’s Commitment and the denominator of which is the aggregate Commitments of all Lenders.

(o) “Commitments” means, at any time, the sum of, the Aggregate Tranche A Commitments, the Aggregate Tranche B Commitments and the Aggregate Tranche C Commitments; the sum of all of which shall not exceed $1,500,000 without the prior written consent of the Required Lenders. As of the date hereof, the aggregate Commitments are $800,000

(p) “Common Stock” shall be as defined in Section 4.4(a).

(q) “Company” shall have the meaning given such term in the introductory paragraph of this Agreement and shall include all permitted successors and assigns of such Person.

(r) “Contingent Convertible Portion” shall be as defined in Section 4.4(b).

(s) “Contract Period” means the period of time commencing on the date hereof and continuing through and including the Final Maturity Date, subject to acceleration as provided herein following any Event of Default.

(t) “Conversion Date” shall be as defined in Section 4.4(a).

(u) “Conversion Price” shall mean (i) with respect to the Tranche A Term Loan, the volume weighted average price of the Common Stock on the NYSE American Exchange, during the five trading days preceding the date of this Agreement (“Tranche A Conversion Price”), subject to adjustment as contemplated by Section 4.4(e); (ii) with respect to the Tranche B Term Loan, the greater of (a) the volume weighted average price of the Common Stock on the NYSE American Exchange, during the twenty trading days ending on the earlier of (A) the trading day immediately preceding the date on which the Tranche B Lenders agreement to provide the Tranche B Commitment is publicly announced or (B) the trading day immediately preceding the date on which the Tranche B Lenders become party to this Agreement, and (b) the Tranche A Conversion Price (the “Tranche B Conversion Price”), subject to adjustment as contemplated by Section 4.4(e); and (iii) with respect to the Tranche C Term Loan, the greater of (a) the volume weighted average price of the Common Stock on the NYSE American Exchange, during the twenty trading days ending on the earlier of (A) the trading day immediately preceding the date on which the Tranche B Lenders agreement to provide the Tranche C Commitment is publicly announced or (B) the trading day immediately preceding the date on which the Tranche C Lenders become party to this Agreement, and (b) the Tranche A Conversion Price (the “Tranche C Conversion Price”), subject to adjustment as contemplated by Section 4.4(e). Promptly following the date on which the Conversion Price in respect of the Tranche A Term Loan, the Tranche B Term Loan and/or the Tranche C Term Loan is capable of being determined, the Company and the Agent shall countersign and append to this Agreement, a Confirmation of such Conversion Price, in the form attached hereto as Exhibit A, with a copy thereof provided to each Tranche A Lender, Tranche B Lender and/or Tranche C Lender, as the case may be.

(v) “Corporation” means a corporation, partnership, limited liability company, trust, unincorporated organization, association, joint stock company or joint venture.

(w) “Default” means any event which with the giving of notice, passage of time or both, could constitute an Event of Default.

(x) “Disinterested Directors” means as of any date, those members of the Board of Directors of the Company who are not Lender Parties hereunder.

(y) “Effective Date” means the date that Agent receives an original (or faxed or electronic copy) of (i) this Agreement, duly authorized, executed and delivered by the Company, Agent and the Lenders; (ii) the Subordination Agreement; and (iii) the IP Security Agreement, and such date shall be the date set forth on the first page of this Agreement.

(z) “Event of Default” means each of the events specified in Section 9.1.

(aa) “Final Maturity Date” shall be as defined in Section 4.2.

(bb) “GAAP” means generally accepted accounting principles in the United States of America, in effect from time to time, consistently applied and maintained.

(cc) “Indebtedness”, as applied to a Person, means:

(i) all items (except items of capital stock or of surplus) which in accordance with GAAP would be included in determining total liabilities as shown on the liability side of a balance sheet of such Person as at the date as of which Indebtedness is to be determined;

(ii) to the extent not included in the foregoing, all indebtedness, obligations, and liabilities secured by any mortgage, pledge, lien, conditional sale or other title retention agreement or other security interest to which any property or asset owned or held by such Person is subject, whether or not the indebtedness, obligations or liabilities secured thereby shall have been assumed by such Person; and

(iii) to the extent not included in the foregoing, all indebtedness, obligations and liabilities of others which such Person has directly or indirectly guaranteed, endorsed (other than for collection or deposit in the ordinary course of business), sold with recourse, or agreed (contingently or otherwise) to purchase or repurchase or otherwise acquire or in respect of which such Person has agreed to supply or advance funds (whether by way of loan, stock purchase, capital contribution or otherwise) or otherwise to become directly or indirectly liable.

(dd) “Interest Payment Date” shall be as defined in Section 4.1.

(ee) “Lender Indebtedness” means all Indebtedness of the Company to Agent and the Lenders, whether now or hereafter owing or existing, including, without limitation, all obligations under the Loan Documents, all other obligations or undertakings now or hereafter made by or for the benefit of the Company to or for the benefit of Agent or the Lenders under any other agreement, promissory note or undertaking now existing or hereafter entered into by the Company with Agent or the Lenders, together with all interest and other sums payable in connection with any of the foregoing.

(ff) “Lender Parties” means, individually and collectively, Agent and the Lenders.

(gg) “Lenders” shall have the meaning given such term in the introductory paragraph of this Agreement and shall include all permitted successors and assigns of such Person(s).

(hh) “Loan Documents” means this Agreement, the Subordination Agreement, the IP Security Agreement and all other documents, executed or delivered by the Company or any other Person pursuant to this Agreement or in connection herewith, as they may be amended, modified or restated from time to time.

(ii) “MidCap” means MidCap Business Credit LLC.

(jj) “MidCap Credit Agreement” means the Loan and Security Agreement dated October 25, 2019 between the Company and MidCap, as amended.

(kk) “Notice of Conversion” shall be as defined in Section 4.4(a).

(ll) “NYSE American Threshold” shall be as defined in Section 4.4(b).

(mm) “Percentage Share” means, with respect to each Lender, such Lender’s Percentage Share of the Tranche A Term Loan, the Tranche B Term Loan or the Tranche C Term Loan, as the case may be, as set forth on Schedule 1.1 hereto

(nn) “Person” means an individual, a Corporation or a government or any agency or subdivision thereof, or any other entity.

(oo) “PIK Interest” shall be as defined in Section 4.1.

(pp) “Pro Rata Percentage” means, as to each Lender, a fraction, expressed as a percentage, the numerator of which is the principal amount of the Advances then owed to such Lender hereunder and the denominator of which is the principal amount of Advances then owed to all the Lenders hereunder, as reflected by Agent’s records.

(qq) “Requested Advance Date” shall be as defined in Section 2.3.

(rr) “Required Lenders” means (i) those Lenders holding at least seventy-five (75%) of the total Commitments or (ii) in the event that the Commitments of the Lenders hereunder have terminated, those Lenders holding at least seventy five percent (75%) of the outstanding principal amount of the Term Loan outstanding hereunder, as reflected by Agent’s records.

(ss)  “Senior Indebtedness” means (i) the Indebtedness of the Company and/or one or more of the Company’s Affiliates owed to MidCap under the MidCap Credit Agreement, (ii) any Indebtedness of the Company and/or one or more of the Company’s Affiliates that may arise under, out of, or in connection with any obligation of any of such entities to commercial lenders for money advanced to any of such entities and (iii) any renewal, replacement or refinancing of any of the foregoing, in each case whether or not such Indebtedness is expressly subordinated hereto.

(tt) “Senior Indebtedness Debt Cap” means the sum of (a) the aggregate principal amount of Senior Indebtedness (including the undrawn or unreimbursed amount of all letters of credit constituting Senior Indebtedness up to the sum of Eight Million Dollars ($8,000,000) plus (b) the amount of all overadvances by the holder of Senior Indebtedness, up to $1,000,000; plus (c) 85% of all Eligible Receivables, plus (d) 50% of all Eligible Inventory (as such terms are defined in the MidCap Credit Agreement or any subsequent credit agreement memorializing Senior Indebtedness) acquired in connection with any acquisition by the Company of the assets of a Person that is not a borrower hereunder; plus (e) amounts in respect of accrued, unpaid interest, fees and expenses attributable to the items described in clauses (a) through (d) above.

(uu) “Subordination Agreement” means the Subordination Agreement dated on or about the date hereof between Agent (for itself and on behalf of all the Lenders) and MidCap or between Agent and any subsequent holder of Senior Indebtedness.

(vv) “Subsidiary” means a corporation or limited liability company (i) which is organized under the laws of the United States or any State thereof, or any other county or jurisdiction, (ii) which conducts substantially all of its business and has substantially all of its assets within the United States and (iii) of which more than fifty percent (50%) of its outstanding voting stock of every class (or other voting equity interest) is owned by the Company or one or more of its Subsidiaries.

(ww) Reserved

(xx) Reserved

(yy) “Term Loan” means, collectively, the Tranche A Term Loan, the Tranche B Term Loan and the Tranche C Term Loan.

(zz) “Tranche A Commitment” means the Tranche A Commitment of each Tranche A Lender as set forth on Schedule 1.1 hereto.

(aaa) “Tranche A Conversion Price” shall be as defined in the definition of Conversion Price.

(bbb) “Tranche A Lenders” means each Lender with a Tranche A Commitment as set forth on Schedule 1.1 hereto.

(ccc) “Tranche A Term Loan” shall be as defined in Section 2.1.

(ddd) “Tranche B Commitment” means the Tranche B Commitment of each Tranche B Lender as set forth on Schedule 1.1 hereto, as the same may be amended from time to time.

(eee) “Tranche B Conversion Price” shall be as defined in the definition of Conversion Price.

(fff) “Tranche B Lenders” means each Lender with a Tranche B Commitment as set forth on Schedule 1.1 hereto.

(ggg) “Tranche B Term Loan” shall be as defined in Section 2.1.

(hhh) “Tranche C Commitment” means the Tranche C Commitment of each Tranche C Lender as set forth on Schedule 1.1 hereto, as the same may be amended from time to time.

(iii) “Tranche C Conversion Price” shall be as defined in the definition of Conversion Price.

(jjj) “Tranche C Lenders” means each Lender with a Tranche C Commitment as set forth on Schedule 1.1 hereto.

(kkk) “Tranche C Term Loan” shall be as defined in Section 2.1.

(lll) “Undrawn Tranche B Availability” means, as of any date of measurement, an amount equal to (i) the aggregate Tranche B Commitment, minus (ii) the aggregate principal amount of all Tranche B Loans which have been made as of such date. As of the Effective Date, the Undrawn Tranche B Availability is $0.00.

(mmm) “Undrawn Tranche C Availability” means, as of any date of measurement, an amount equal to (i) the aggregate Tranche C Commitment, minus (ii) the aggregate principal amount of all Tranche C Loans which have been made as of such date. As of the Effective Date, the Undrawn Tranche C Availability is $0.00.

1.2 Accounting Terms. As used in this Agreement, or any certificate, report or other document made or delivered pursuant to this Agreement, accounting terms not defined elsewhere in this Agreement shall have the respective meanings given to them under GAAP.

1.3 UCC Terms. All terms used herein and defined in the Uniform Commercial Code as in effect in the State of Delaware from time to time shall have the meanings given therein unless otherwise defined herein.

2. THE TERM LOAN; USE OF PROCEEDS.

2.1 Term Loan.

(a) Agent and the Lenders will establish for the Company, during the Contract Period and subject to the terms and conditions hereof, a convertible, delayed draw term loan facility consisting of (i) a term loan in the principal amount of $800,000 (“Tranche A Term Loan”), which Tranche A Term Loan is being fully funded on the date hereof by the Lenders in their respective Percentage Shares and constitutes Lender Indebtedness hereunder, (ii) with the consent of the Required Lenders, a delayed draw term loan in the principal amount of the aggregate Tranche B Commitment (“Tranche B Term Loan”), which Tranche B Term Loan shall be made in accordance with Section 2.1(b), and (iii) with the consent of the Required Lenders, a delayed draw term loan in the aggregate principal amount of the aggregate Tranche C Commitment (“Tranche C Term Loan”), which Tranche C Term Loan shall be made in accordance with Section 2.1(c). The Term Loan is not a revolving loan, so that if the Company repays all or any portion of the Term Loan at any time, such amount so repaid may not be re-borrowed. The Term Loan shall be subject to all terms and conditions set forth in all of the Loan Documents, which terms and conditions are incorporated herein. Notwithstanding anything to the contrary contained in this Section 2.1, no Lender will be required or have any obligation to make any extensions of credit hereunder if a Default then exists or could reasonably be expected to result by virtue of the making thereof. Notwithstanding anything to the contrary contained herein, in no event shall the Lenders be obligated to make to the Company, or the Company be entitled to borrow or receive from the Lenders, any loans, advances or extensions of credit hereunder other than the Term Loan.

(b) The Company shall have the right from time to time, at any time during the Contract Period, to request that Tranche B Lenders (if any) make Advances under the Tranche B Term Loan to the Company in an amount not to exceed the then Undrawn Tranche B Availability. In connection with such request, each Tranche B Lender agrees severally (not jointly and not jointly and severally) to make, in accordance with Section 2.3 below, a Tranche B Term Loan to the Company in an amount equal to such Lender’s Percentage Share of such Advance request.

(c) At any time during the Contract Period, when the Undrawn Tranche B Availability is $0, the Company shall have the right, from time to time, to request that Tranche C Lenders (if any) make Advances under the Tranche C Term Loan to the Company in an amount not to exceed the then Undrawn Tranche C Availability. In connection with each such request, each Tranche C Lender agrees severally (not jointly and not jointly and severally) to make, in accordance with Section 2.3 below, a Tranche C Term Loan to the Company in an amount equal to such Lender’s Percentage Share of such Advance request.

2.2 Use of Proceeds. The Company agrees to use Advances under the Term Loan for working capital and general corporate purposes.

2.3 Method of Advances. On any Business Day, the Company may request an Advance by delivering to Agent a written request therefor (each an “Advance Request”), which Advance Request may be submitted by the Chief Financial Officer of the Company, subject to the prior approval of a majority of the Disinterested Directors of the Company. Each such request shall specify (i) the amount of the requested Advance, which shall be at least $50,000.00 or, if less, the current amount of Undrawn Availability, and (ii) the date (the “Requested Advance Date”) upon which the Company desires the Lenders to fund the Advance, which date shall be at least three (3) Business Days subsequent to Agent’s receipt of the Advance Request. Any Advance Request made after 1:00 p.m. on any Business Day shall be deemed to be made on the next following Business Day. Following Agent’s receipt of an Advance Request, Agent (or the applicable Lenders each to the extent of its respective Commitment Percentage) will make the requested Advance on the Requested Advance Date, by transferring immediately available funds via wire transfer or ACH transfer to an account previously designated to Agent in writing by the Company.

3. INTEREST.

3.1 Interest Rate. Interest on outstanding Advances will accrue from the date of advance until final payment (or conversion, as contemplated by Section 4.4 below) thereof, at the rate of twelve percent (12%) per annum (the “Basic Interest Rate”), which interest may be paid as Cash Interest or as PIK Interest, in the discretion of the Company, as more fully contemplated by Section 4.1 below. Interest will be computed on the basis of a year of 360 days and paid for the actual number of days elapsed.

3.2 Limitation of Interest to Maximum Lawful Rate. In no event will the rate of interest payable hereunder exceed the maximum rate of interest permitted to be charged by applicable law (including the choice of law rules) and any interest paid in excess of the permitted rate will be refunded to the Company. Such refund will be made by application of the excessive amount of interest paid against any sums outstanding hereunder and will be applied in such order as Agent may determine. If the excessive amount of interest paid exceeds the sums outstanding, the portion exceeding the sums outstanding will be refunded in cash by Agent, for the account of the Lenders. Any such crediting or refunding will not cure or waive any default by the Company. The Company agrees, however, that in determining whether or not any interest payable hereunder exceeds the highest rate permitted by law, any non-principal payment, including without limitation prepayment fees and late charges, will be deemed to the extent permitted by law to be an expense, fee, premium or penalty rather than interest.

4. PAYMENTS AND CONVERSION.

4.1 Interest Payments. Accrued interest shall be due and payable monthly in arrears on the first day of each calendar month (an “Interest Payment Date”) commencing on the first day of the first calendar month following the date of the Advance to the Company hereunder. Interest will be payable in-kind (“PIK Interest”) on the Accreted Principal Amount of the Term Loan by the automatic increase of the principal amount of the Term Loan on each Interest Payment Date by the amount of accrued interest payable at that time. Notwithstanding the foregoing, at the option of the Company, the Company may pay interest in cash (“Cash Interest”) on any one or more Interest Payment Dates in lieu of PIK Interest.

4.2 Principal Payments. If not paid earlier (or converted into Common Stock as contemplated by Section 4.4), the Company will pay the entire Accreted Principal Amount of the Term Loan, and any other sums due pursuant to the terms hereof, on the later of (i) the third anniversary of the date of this Agreement, or (ii) six months after the maturity date of the Senior Indebtedness (the “Final Maturity Date”).

4.3 Prepayment. The Company may prepay all (or with the consent of any Lender, as to such Lender, any part) of the amounts due on the Term Loan at any time without any premium or penalty, following delivery of not less than five (5) Business Days prior written notice to Agent. All prepayments of the entire Accreted Principal Amount of the Term Loan will be applied on a pro rata basis against the then outstanding balance of the respective Term Loans of the Lenders. If the Company desires to prepay only a portion of the Term Loans, the Company shall so advise Agent and the Lenders by written notice to Agent of the proposed amount to be prepaid. Those Lenders consenting to a partial prepayment shall so advise Agent within five (5) Business Days and Agent shall promptly so advise the Company in writing of the identity of such Lenders. The partial prepayment will be applied pro-rata against the then outstanding balance of the respective Term Loans of the Lenders participating in the partial prepayment.

4.4 Conversion by Lenders.

(a) Subject to Section 4.4(b) below, each of the Lenders may, at any time, convert all but not less than all (unless prior written consent of the Company is obtained), of the Accreted Principal Amount of such Lender’s Term Loan plus any accrued and unpaid interest (but in no event in excess of such Lender’s Commitment Percentage of the NYSE American Threshold) into shares of the Company’s common stock, $0.001 par value per share (the “Common Stock”) at the Conversion Price, subject to adjustment as provided below, by delivering written notice thereof to the Company. Such notice of conversion or any subsequent notice of conversion (each, a “Notice of Conversion”) shall be irrevocable once given and shall specify the amount of the applicable Lender’s Term Loan intended to be converted. The Company shall effect such conversion as promptly as practicable following its receipt of such Notice of Conversion (such date the “Conversion Date”) and interest on the portion of the Term Loan so converted shall cease to accrue on such Conversion Date.

(b) Notwithstanding anything herein to the contrary, initially each Lender’s conversion rights under this Section 4.4 shall be limited to such Lender’s Commitment Percentage of the lesser of (i) such number of shares of Common Stock as equals less than 20% of all presently outstanding Common Stock, as contemplated by Section 713(a) of the NYSE American Rules or (ii) the maximum number of shares of Common Stock that will not cause the ownership of the Company by any or all the Lenders to reach or exceed the “change in control” threshold amount under Section 713(b) of the NYSE American Rules, as amended from time to time, in each case, so long as such Rules continue to be applicable to the Company (the “NYSE American Threshold”). The Company will, at its sole cost and expense, include within the agenda for its annual meeting of stockholders to be held in 2020, a proposal for stockholder approval of the transactions contemplated by this Agreement, including the conversion of the entire amount of the Term Loan (including, without limitation, the portion of the outstanding Term Loan that would cause the ownership of the Company by the Lenders to exceed the NYSE American Threshold (the “Contingent Convertible Portion”)) into shares of Common Stock at the Conversion Price.

(c) The Company covenants and agrees that the shares of Common Stock that may be issued upon the exercise of any Lender’s conversion rights hereunder will, upon issuance, be validly issued and outstanding, fully paid and non-assessable, and free from all taxes, liens and charges with respect to the issuance thereof. The Company further covenants and agrees that the Company will at all times during the time that principal or interest is owed pursuant to this Agreement, have authorized and reserved, free from preemptive rights, a sufficient number of shares of its Common Stock to provide for the conversion rights set forth herein. If at any time while the Lenders have conversion rights hereunder, the number of authorized but unissued shares of Common Stock shall not be sufficient to permit conversion of amounts owed hereunder, the Company will take such corporate action as may, in the opinion of its counsel, be necessary to increase its authorized but unissued shares of Common Stock to such number of shares as shall be sufficient for such purposes.

(d) Upon a conversion hereunder, the Company shall not be required to issue stock certificates representing fractions of shares of Common Stock, and in lieu of any fractional shares which would otherwise be issuable, the Company shall issue the next lowest whole number of shares of Common Stock.

(e) In the event of changes in the outstanding Common Stock of the Company by reason of stock dividends, splits, recapitalizations, reclassifications, combinations or exchanges of shares, separations, reorganizations, liquidations, or the like, the Conversion Price shall be correspondingly adjusted to give the Lenders, on exercise for the same aggregate Conversion Price, the total number, class, and kind of shares as the Lenders would have owned had the Term Loan been converted prior to the event and had the Lenders continued to hold such shares until after the event requiring adjustment.

4.5 Payments to Agent. All payments in respect to the Term Loan shall be paid to Agent, for the ratable benefit of the Lenders, to an account specified by Agent to the Company from time to time.

5. SECURITY.

5.1 Personal Property. As security for the full and timely payment and performance of all Lender Indebtedness, the Company hereby grants to Agent, for itself and the benefit of the Lenders, a security interest in all existing and after-acquired personal property of the Company of any nature including, without limitation:

(a) All present and future accounts, contract rights, chattel paper, instruments and documents and all other rights to the payment of money whether or not yet earned, for services rendered or goods sold, consigned, leased or furnished by the Company or otherwise, together with (i) all goods (including any returned, rejected, repossessed or consigned goods), the sale, consignment, lease or other furnishing of which shall be given or may give rise to any of the foregoing, (ii) all of the Company’s rights as a consignor, consignee, unpaid vendor or other lien or in connection therewith, including stoppage in transit, set-off, detinue, replevin and reclamation, (iii) all general intangibles related thereto, (iv) all guaranties, mortgages, security interests, assignments, and other encumbrances on real or personal property, leases and other agreements or property securing or relating to any accounts, (v) choses-in-action, claims and judgments, and (vi) any returned or unearned premiums, which may be due upon cancellation of any insurance policies.

(b) All present and future inventory of the Company (including but not limited to goods held for sale or lease or furnished or to be furnished under contracts for service, raw materials, work-in-process, finished goods and goods used or consumed in the Company’s business) whether owned, consigned or held on consignment, together with all merchandise, component materials, supplies, packing, packaging and shipping materials, and all returned, rejected or repossessed goods sold, consigned, leased or otherwise furnished by such the Company and all embedded software related thereto.

(c) All present and future general intangibles (including but not limited to payment intangibles, tax refunds and rebates, manufacturing and processing rights, designs, patents, patent rights and applications therefor, trademarks and registration or applications therefor, trade names, brand names, logos, inventions, copyrights and all applications and registrations therefor), licenses, permits, approvals, software and computer programs, license rights, royalties, trade secrets, methods, processes, know-how, formulas, drawings, specifications, descriptions, label designs, plans, blueprints, patterns and all memoranda, notes and records with respect to any research and development.

(d) All present and future machinery, equipment, furniture, fixtures, motor vehicles, tools, dies, jigs, molds and other articles of tangible personal property of every type together with all parts, substitutions, accretions, accessions, attachments, accessories, additions, components and replacements thereof, and all manuals of operation, maintenance or repair, and all embedded software related thereto.

(e) All present and future general ledger sheets, files, books and records, customer lists, books of account, invoices, bills, certificates or documents of ownership, bills of sale, business papers, correspondence, credit files, tapes, cards, computer runs and all other data and data storage systems whether in the possession of the Company or any service bureau.

(f) All present and future letter of credit rights and supporting obligations, including without limitation, all letters of credit and letter of credit rights now existing or hereafter issued naming the Company as a beneficiary or assigned to the Company, including the right to receive payment thereunder, and all documents and records associated therewith.

(g) All present and future financial assets and investment property of the Company.

(h) All funds, instruments, documents, policies and evidence and certificates of insurance and rights thereunder, securities, chattel paper and other assets of the Company or in which the Company has an interest and all proceeds thereof, now or at any time hereafter on deposit with or in the possession or control of Lender Parties or owing by Lender Parties to the Company or in transit by mail or carrier to Lender Parties or in the possession of any other Person acting on any Lender Party’s behalf, without regard to whether any Lender Party received the same in pledge, for safekeeping, as agent for collection or otherwise, or whether any Lender Party has conditionally released the same, and in all assets of the Company in which Lender Parties now have or may at any time hereafter obtain a lien, mortgage, or security interest for any reason.

(i) All products and proceeds of each of the items described in the foregoing subparagraphs (a)-(h) and all supporting obligations related thereto.

5.2 Reserved.

5.3 General.

(a) The collateral described above in Section 5.1 is collectively referred to herein as the “Collateral”. The above-described security interests, assignments and liens shall not be rendered void by the fact that no Lender Indebtedness exists as of any particular date, but shall continue in full force and effect until the Lender Indebtedness has been repaid or converted into Common Stock. Lender Parties have no agreement or commitment outstanding pursuant to which Lender Parties may extend credit to or on behalf of the Company and Lender Parties have executed termination statements or releases with respect thereto.

(b) The Company hereby irrevocably authorizes Agent at any time and from time to time to file UCC financing statements with respect to the Collateral, naming the Company as debtor, and agrees to provide Agent promptly with any information requested by Agent in connection with any such financing statements.

(c) The Company shall furnish to Agent from time to time statements and schedules further identifying and describing the Collateral and such other reports in connection with the Collateral as Agent may reasonably request, all in reasonable detail. The Company shall promptly execute and deliver to Agent any instruments and documents, and shall promptly take such further action, as Agent may reasonably request to obtain the benefit of the security interests granted by this Section 5.

6. REPRESENTATIONS AND WARRANTIES. The Company represents and warrants as follows:

6.1 Company Representations and Warranties. The Company represents and warrants as follows:

(a) Valid Organization, Good Standing and Qualification. The Company is duly formed, validly existing and in good standing under the laws of the State of Delaware, and has full power and authority to execute, deliver and comply with the Loan Documents and to carry on its business as it is now being conducted.

(b) Due Authorization; No Legal Restrictions. The execution and delivery by the Company of the Loan Documents, the consummation of the transactions contemplated by the Loan Documents and the fulfillment and compliance with the respective terms, conditions and provisions of the Loan Documents: (a) have been duly authorized by all requisite corporate action of the Company, (b) will not conflict with or result in a breach of, or constitute a default (or might, upon the passage of time or the giving of notice or both, constitute a default) under, any of the terms, conditions or provisions of any applicable statute, law, rule, regulation or ordinance, or the Company’s organizational documents or any indenture, mortgage, loan, credit agreement or other document or instrument to which the Company is a party or by which the Company may be bound or affected, or any judgment or order of any court or governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign, and (c) will not result in the creation or imposition of any lien, charge or encumbrance of any nature whatsoever upon any of the property or assets of the Company under the terms or provisions of any such agreement or instrument, except liens in favor of Lender Parties.

(c) Enforceability. The Loan Documents have been duly executed by the Company and delivered to Agent and constitute legal, valid and binding obligations of the Company, enforceable in accordance with their terms, except as enforceability may be limited by any bankruptcy, insolvency, reorganization, moratorium or other laws or equitable principles affecting creditors’ rights generally.

(d) Governmental Consents. No consent, approval or authorization of or designation, declaration or filing with any governmental authority on the part of the Company is required in connection with the execution, delivery or performance by the Company of the Loan Documents or the consummation of the transactions contemplated thereby.

(e) Title to Collateral. The Collateral is and will be owned by the Company free and clear of all liens and other encumbrances of any kind (including liens or other encumbrances upon properties acquired or to be acquired under conditional sales agreements or other title retention devices), excepting only liens in favor of Agent and those liens and encumbrances permitted under Section 7.4 below. The Company will defend the Collateral against any claims of all persons or entities other than Agent or such other permitted lienholders as are set forth in Section 7.4.

6.2 Lender Parties’ Representations and Warranties. Lender Parties represent and warrant as follows:

(a) Qualification; No Legal Restrictions. Lender Parties have full power and authority to execute, deliver and comply with the Loan Documents. The execution and delivery by Lender Parties of the Loan Documents, the consummation of the transactions contemplated by the Loan Documents and the fulfillment and compliance with the respective terms, conditions and provisions of the Loan Documents will not conflict with or result in a breach of, or constitute a default (or might, upon the passage of time or the giving of notice or both, constitute a default) under, any of the terms, conditions or provisions of any applicable statute, law, rule, regulation or ordinance, or any indenture, mortgage, loan, credit agreement or other document or instrument to which any Lender Party is a party or by which any Lender Party may be bound or affected, or any judgment or order of any court or governmental department, commission, board, bureau, agency or instrumentality, domestic or foreign.

(b) Enforceability. The Loan Documents have been duly executed by Lender Parties and delivered to the Company and constitute legal, valid and binding obligations of Lender Parties, enforceable in accordance with their terms, except as enforceability may be limited by any bankruptcy, insolvency, reorganization, moratorium or other laws or equitable principles affecting creditors’ rights generally.

(c) Governmental Consents. No consent, approval or authorization of or designation, declaration or filing with any governmental authority on the part of any Lender Party is required in connection with the execution, delivery or performance by Lender Parties of the Loan Documents or the consummation of the transactions contemplated thereby.

7. GENERAL COVENANTS. The Company will comply with the following:

7.1 Maintenance of the Company’s Existence. The Company shall keep in full force and effect: (a) its legal existence in good standing under the law of its jurisdiction of organization and (b) its qualification to do business in each jurisdiction in which such qualification is required.

7.2 Restrictions on Indebtedness. The Company shall not, without the prior written consent of Agent, incur any indebtedness for borrowed money except for (a) Senior Indebtedness and (b) Lender Indebtedness, (c) indebtedness otherwise permitted to be incurred by MidCap, and (d) trade indebtedness incurred in the ordinary course of business.

7.3 Defaults. The Company shall promptly notify Agent of any event of default under any document related to Senior Indebtedness, or any event or condition which with the passage of time or the giving of notice would become such an event of default.

7.4 Removal of Collateral. Except with the prior written consent of Agent, the Company shall not (i) remove any of the Collateral from the location specified above other than in the ordinary course of business or (ii) change its name or its jurisdiction of incorporation, relocate its principal place of business or reincorporate or reorganize itself.

7.5 Maintenance of Collateral. The Company shall keep the Collateral in good order and repair, not waste any Collateral, not use any Collateral in violation of law or any policy of insurance, comply in all material respects with its obligations with respect to the Collateral, and make the Collateral available for inspection by Agent (or its Agents, attorneys or accountants) at all reasonable times.

8. CONDITIONS TO ADVANCES. Advances shall be conditioned upon the following conditions and each request by the Company for an Advance shall constitute a representation by the Company to Lender Parties that each condition has been met or satisfied:

8.1 Representations and Warranties. All representations and warranties of the Company contained herein or in any other Loan Document shall be true at and as of the date of such Advance as if made on such date, and each request for an Advance shall constitute reaffirmation by the Company that such representations and warranties are then true.

8.2 No Default. No condition or event shall exist or have occurred at or as of the date of such Advance which would constitute a Default or Event of Default hereunder.

8.3 Other Requirements. Lender Parties shall have received all certificates, authorizations, affidavits, schedules and other documents which are provided for hereunder or under the Loan Documents, or which Lender Parties may reasonably request.

9. DEFAULT AND REMEDIES.

9.1 Events of Default. The occurrence of any one or more of the following events shall constitute an Event of Default hereunder:

(a) The failure of the Company to pay any amount of principal, interest or any other amount payable hereunder, or any other Lender Indebtedness on the date on which such payment is due, whether at the stated maturity or due date thereof, or by reason of any requirement for the prepayment thereof, by acceleration or otherwise, and such failure continues unremedied for a period of ten (10) days after the date such payment is first due;

(b) The failure of the Company to duly perform or observe any obligation, covenant or agreement on its part contained herein or in any other Loan Document not otherwise specifically constituting an Event of Default under this Section 9.1 and such failure continues unremedied for a period of thirty (30) days after notice from Agent to the Company of the existence of such failure;

(c) The failure of the Company to pay any Indebtedness for borrowed money due to any third Person or the existence of any other event of default under any loan agreement, security agreement, or other agreement pertaining thereto binding the Company, after the expiration of any notice and/or grace periods permitted in such documents;

(d) The adjudication of the Company as a bankrupt or insolvent, or the entry of an order appointing a receiver or trustee for the Company or any of its respective property or approving a petition seeking reorganization or other similar relief under the bankruptcy or other similar laws of the United States or any state or any other competent jurisdiction;

(e) A proceeding under any bankruptcy, reorganization, arrangement of debt, insolvency, readjustment of debt or receivership law is filed by or against (unless dismissed within thirty (30) days and provided that Lender Parties shall have no obligation to make Advances during such thirty (30) day period the Company, or the Company makes an assignment for the benefit of creditors, or the Company takes any action to authorize any of the foregoing;

(f) The suspension of the operation of the Company’s present business (other than as necessary or as directed in connection with a natural disaster, pandemic or by virtue of governmental mandate), the Company becoming unable to meet its debts as they mature or the admission in writing by the Company to such effect, or the Company calling any meeting of all or any material portion of its creditors for the purpose of debt restructure;

(g) All or any part of the Collateral or the assets of the Company are attached, seized, subjected to a writ or distress warrant, or levied upon, or come within the possession or control of any receiver, trustee, custodian or assignee for the benefit of creditors;

(h) Any representation or warranty of the Company in any of the Loan Documents is discovered to be untrue in any material respect or any statement, certificate or data furnished by the Company pursuant hereto is discovered to be untrue in any material respect as of the date as of which the facts therein set forth are stated or certified;

(i) Any material uninsured damage to, or loss, theft, or destruction of, a material portion of the Collateral occurs;

(j) The loss, suspension, revocation or failure to renew any license or permit now held or hereafter acquired by the Company, which loss, suspension, revocation or failure to renew will have a material adverse effect on the business profits, assets or financial condition of the Company;

(k) The occurrence of an event of default under any of the other Loan Documents; or

(l) The validity or enforceability of this Agreement, or any of the Loan Documents, is contested by the Company or any stockholder of the Company, or the Company denies that it has any or any further liability or obligation hereunder or thereunder.

9.2 Remedies. Solely as directed by the Required Lenders, by and through the Agent, upon the occurrence of an Event of Default, or at any time thereafter:

(a) The entire unpaid principal of the Term Loan, all other Lender Indebtedness, or any part thereof, all interest accrued thereon, all fees due hereunder and all other obligations of the Company to Lender Parties hereunder or under any other agreement, note or otherwise arising will become immediately due and payable without any further demand or notice;

(b) The Term Loan will immediately terminate, and the Company will receive no further extensions of credit thereunder;

(c) Agent may enter any premises occupied by the Company and take possession of the Collateral and any records relating thereto; and/or

(d) Lender Parties, by and through Agent, may exercise each and every right and remedy granted to Lender Parties under the Loan Documents, under the Uniform Commercial Code and under any other applicable law or at equity.

If an Event of Default occurs under Section 9.1(d) or (e), all Lender Indebtedness shall become immediately due and payable.

9.3 Sale or Other Disposition of Collateral. The sale, lease or other disposition of the Collateral, or any part thereof, by Agent after an Event of Default may be for cash, credit or any combination thereof, and Agent, for itself and on behalf of the Lenders, may purchase all or any part of the Collateral at public or, if permitted by law, private sale, and in lieu of actual payment of such purchase price, may set-off the amount of such purchase price against the Lender Indebtedness then owing. Any sales of the Collateral may be adjourned from time to time with or without notice. Agent may cause the Collateral to remain on the Company’s premises or otherwise or to be removed and stored at premises owned by other persons, at the Company’s expense, pending sale or other disposition of the Collateral. The Company, at Agent’s request, shall assemble the Collateral consisting of inventory and tangible assets and make such assets available to Agent at a place to be designated by Agent. Agent shall have the right to conduct such sales on the Company’s premises, at the Company’s expense, or elsewhere, on such occasion or occasions as Agent may see fit. Any notice required to be given by Agent of a sale, lease or other disposition or other intended action by Agent with respect to any of the Collateral which is deposited in the United States mail, postage prepaid and duly addressed to the Company at the address specified in Section 11.1 below, at least ten (10) business days prior to such proposed action, shall constitute fair and reasonable notice to the Company of any such action. The net proceeds realized by Agent upon any such sale or other disposition, after deduction for the expenses of retaking, holding, storing, transporting, preparing for sale, selling or otherwise disposing of the Collateral incurred by Lender Parties in connection therewith and all other costs and expenses related thereto including attorney fees, shall be applied in such order as Agent, in its sole discretion, elects, toward satisfaction of the Lender Indebtedness. Agent shall account to the Company for any surplus realized upon such sale or other disposition, and the Company shall remain liable for any deficiency. The commencement of any action, legal or equitable, or the rendering of any judgment or decree for any deficiency shall not affect Agent’s security interest in the Collateral. The Company agrees that Lender Parties have no obligation to preserve rights to the Collateral against any other parties. Agent is hereby granted a license or other right to use, after an Event of Default, without charge, the Company’s labels, general intangibles, intellectual property, equipment, real estate, patents, copyrights, rights of use of any name, trade secrets, trade names, trademarks, service marks and advertising matter, or any property of a similar nature, as it pertains to the Collateral, in completing production of, advertising for sale and selling any inventory or other Collateral and the Company’s rights under all contracts, licenses, approvals, permits, leases and franchise agreements shall inure to Lender Parties’ benefit. Lender Parties shall be under no obligation to marshal any assets in favor of the Company or any other party or against or in payment of any or all of the Lender Indebtedness.

9.4 Set-Off. Without limiting the rights of Lender Parties under applicable law, Lender Parties have and may exercise a right of set-off, a lien against and a security interest in all property of the Company now or at any time in any Lender Party’s possession in any capacity whatsoever, including but not limited to any balance of any deposit, trust or agency account, or any other Lender Party account with Agent, as security for all Lender Indebtedness. At any time and from time to time following the occurrence of an Event of Default, or an event which with the giving of notice or passage of time or both would constitute an Event of Default, Lender Parties may without notice or demand, set off and apply any and all deposits (general or special, time or demand, provisional or final) at any time held and other indebtedness at any time owing by any Lender Party to or for the credit of the Company against any or all of the Lender Indebtedness and the Company’s obligations under the Loan Documents.

9.5 Delay or Omission Not Waiver. Neither the failure nor any delay on the part of any Lender Party to exercise any right, remedy, power or privilege under the Loan Documents upon the occurrence of any Event of Default or otherwise shall operate as a waiver thereof or impair any such right, remedy, power or privilege. No waiver of any Event of Default shall affect any later Event of Default or shall impair any rights of any Lender Party. No single, partial or full exercise of any rights, remedies, powers and privileges by any Lender Party shall preclude further or other exercise thereof. No course of dealing between any Lender Party and the Company shall operate as or be deemed to constitute a waiver of any Lender Party’s rights under the Loan Documents or affect the duties or obligations of the Company.

9.6 Remedies Cumulative; Consents. The rights, remedies, powers and privileges provided for herein shall not be deemed exclusive, but shall be cumulative and shall be in addition to all other rights, remedies, powers and privileges in Lender Parties’ favor at law or in equity. Whenever Agent’s consent or approval is required, such consent or approval shall be at the sole and absolute discretion of Agent.

9.7 Certain Fees, Costs, Expenses, Expenditures and Indemnification. The Company agrees to pay on demand all costs and expenses of Lender Parties, including without limitation:

(a) all costs and expenses in connection with the preparation, review, negotiation, execution, delivery and administration of the Loan Documents, and the other documents to be delivered in connection therewith, or any amendments, extensions and increases to any of the foregoing (including, without limitation, attorney’s fees and expenses); and

(b) all losses, costs and expenses in connection with the enforcement, protection and preservation of any Lender Party’s rights or remedies under the Loan Documents, or any other agreement relating to any Lender Indebtedness, or in connection with legal advice relating to the rights or responsibilities of any Lender Party (including without limitation court costs and attorney’s fees).

In the event the Company shall fail to pay taxes, insurance, assessments, costs or expenses which it is required to pay hereunder, or fails to keep the Collateral free from security interests or liens (except as expressly permitted herein), or fails to maintain or repair the Collateral as required hereby, or otherwise breaches any obligations under the Loan Documents, Agent in its discretion, may make expenditures for such purposes and the amount so expended (including attorney’s fees and expenses, filing fees and other charges) shall be payable by the Company on demand and shall constitute part of the Lender Indebtedness.

The Company’s obligations under this Section shall survive termination of this Agreement and repayment of the Lender Indebtedness.

9.8 Time is of the Essence. Time is of the essence in the Company’s performance of its obligations under the Loan Documents.

10. SUBORDINATION.

10.1 Subordination. Notwithstanding anything to the contrary contained in this Agreement:

(a) The Loan Documents and all of the Lender Indebtedness shall be subordinate to the Senior Indebtedness, as provided in the Subordination Agreement. For the benefit of MidCap, each of the Lender Parties agrees to be legally bound by the execution and delivery by Agent (as the authorized representative and on behalf of each Lender), of the Subordination Agreement, and in the case of any Person that becomes party hereto as a Lender after the date hereof, each such Person acknowledges the prior execution and delivery by Agent (as the authorized representative and on behalf of each such Person, as a Lender), of the Subordination Agreement for the benefit of MidCap and agrees to be legally bound thereby. Lender Parties agree that upon any replacement, renewal or refinancing of Senior Indebtedness, they will enter into any new or replacement subordination documentation with respect to Senior Indebtedness as may be reasonably requested by the Company, so long as such subordination documentation is on terms substantially similar to the Subordination Agreement. The Company will not permit the Senior Indebtedness to exceed the Senior Indebtedness Debt Cap, without the prior written consent of the Required Lenders.

(b) Lender Parties may enforce rights granted under this Agreement or any other Loan Document only in a manner not inconsistent with the Subordination Agreement. Any assignee of MidCap, and any commercial Lender providing financing to the Company or any Affiliate (including financing undertaken for the purpose of refinancing Senior Indebtedness), shall have the benefit of this Article 10 and of the other provisions of this Agreement.

(c) Notwithstanding any provision in this Agreement or the other Loan Documents, each of the Lender Parties irrevocably authorizes and instructs Agent to enter into the Subordination Agreement.

11. COMMUNICATIONS AND NOTICES.

11.1 Communications and Notices. All notices, requests and other communications made or given in connection with the Loan Documents shall be in writing and, unless receipt is stated herein to be required, shall be deemed to have been validly given if delivered personally to the individual or division or department to whose attention notices to a party are to be addressed, or by private carrier, or registered or certified mail, return receipt requested, or by telecopy (to the extent a telecopy number is set forth below) with the original forwarded by first-class mail, in all cases, with charges prepaid, addressed as follows, until some other address (or individual or division or department for attention) shall have been designated by notice given by one party to the other:

To the Company:

Blonder Tongue Laboratories, Inc. 

One Jake Brown Road 

Old Bridge, New Jersey 08857 

Attention: Eric Skolnik, Chief Financial Officer 

Telecopy No.: 732 679-3259

With a copy to:

Stradley Ronon Stevens & Young, LLP 

100 Park Avenue, Suite 2000 

New York, New York 10017 

Attention: Gary P. Scharmett, Esquire 

Telecopy No.: 215 564-8120

To Lenders

c/o Agent:

Robert J. Pallé, Agent 

c/o Blonder Tongue Laboratories, Inc. 

One Jake Brown Road, 

Old Bridge, New Jersey 08857 

Telecopy No: 732 679 3259

With a copy to:

Lee Lowinger PC 

1750 Tysons Boulevard, Suite 1500 

McLean, Virginia 22102 

Attention: Wayne M. Lee, Esquire 

Telecopy No.: 301 365 8108

12. WAIVERS.

12.1 Waivers. In connection with any proceedings under the Loan Documents, including without limitation any action by Agent in replevin, foreclosure or other court process or in connection with any other action related to the Loan Documents or the transactions contemplated hereunder, the Company waives:

(a) all errors, defects and imperfections in such proceedings;

(b) all benefits under any present or future laws exempting any property, real or personal, or any part of any proceeds thereof from attachment, levy or sale under execution, or providing for any stay of execution to be issued on any judgment recovered under any of the Loan Documents or in any replevin or foreclosure proceeding, or otherwise providing for any valuation, appraisal or exemption;

(c) presentment for payment, demand, notice of demand, notice of non-payment, protest and notice of protest of any of the Loan Documents;

(d) any requirement for bonds, security or sureties required by statute, court rule or otherwise;

(e) any demand for possession of Collateral prior to commencement of any suit; and

12.2 Forbearance. Agent may release, compromise, forbear with respect to, waive, suspend, extend or renew any of the terms of the Loan Documents, without notice to the Company. 

13. SUBMISSION TO JURISDICTION.

13.1 Submission to Jurisdiction. The Company hereby consents to the exclusive jurisdiction of any state or federal court located within the State of New Jersey, and irrevocably agrees that, subject to Agent’s election, all actions or proceedings relating to the Loan Documents or the transactions contemplated hereunder shall be litigated in such courts, and the Company waives any objection which it may have based on lack of personal jurisdiction, improper venue or forum non conveniens to the conduct of any proceeding in any such court and waives personal service of any and all process upon it, and consents that all such service of process be made by mail or messenger directed to it at the address set forth in Section 11.1. Nothing contained in this Section 13.1 shall affect the right of Agent to serve legal process in any other manner permitted by law or affect the right of any Lender Party to bring any action or proceeding against the Company or its property in the courts of any other jurisdiction.

14. MISCELLANEOUS.

14.1 Survival. All covenants, agreements, representations and warranties made by the Company in the Loan Documents or made by or on its behalf in connection with the transactions contemplated herein shall be true at all times this Agreement is in effect and shall survive the execution and delivery of the Loan Documents, any investigation at any time made by any Lender Party or on its behalf and the making by any Lender Party of the loans or advances to the Company. All statements contained in any certificate, statement or other document delivered by or on behalf of the Company pursuant hereto or in connection with the transactions contemplated hereunder shall be deemed representations and warranties by the Company.

14.2 No Assignment. The Company may not assign any of its rights or obligations hereunder without the prior written consent of Agent, and any such assignment without consent shall be void and of no force or effect. Any Lender Party may assign its rights and obligations hereunder in its discretion.

14.3 Binding Effect. This Agreement and all rights and powers granted hereby will bind and inure to the benefit of the parties hereto and their respective permitted successors and permitted assigns.

14.4 Severability. The provisions of this Agreement and all other Loan Documents are deemed to be severable, and the invalidity or unenforceability of any provision shall not affect or impair the remaining provisions which shall continue in full force and effect.

14.5 No Third-Party Beneficiaries. The rights and benefits of this Agreement and the Loan Documents shall not inure to the benefit of any third party.

14.6 Modifications. No modification of this Agreement or any of the Loan Documents shall be binding or enforceable unless in writing and signed by or on behalf of the party against whom enforcement is sought.

14.7 Business Day Convention. If the day provided herein for the payment of any amount or the taking of any action falls on a Saturday, Sunday or public holiday at the place for payment or action, then the due date for such payment or action will be the next succeeding Business Day.

14.8 Law Governing. This Agreement shall be construed in accordance with and governed by the laws of the State of Delaware without regard to conflict of law principles.

14.9 Integration. The Loan Documents shall be construed as integrated and complementary of each other, and as augmenting and not restricting any Lender Party’s rights, powers, remedies and security. The Loan Documents contain the entire understanding of the parties thereto with respect to the matters contained therein and supersede all prior agreements and understandings between the parties with respect to the subject matter thereof and do not require parol or extrinsic evidence in order to reflect the intent of the parties. In the event of any inconsistency between the terms of this Agreement and the terms of the other Loan Documents, the terms of this Agreement shall prevail.

14.10 Headings. The headings of the Articles, Sections, paragraphs and clauses of this Agreement are inserted for convenience only and shall not be deemed to constitute a part of this Agreement.

14.11 Counterparts. This Agreement may be executed in any number of counterparts, all of which taken together shall constitute one and the same instrument, and any of the parties hereto may execute this Agreement by signing any such counterpart. Electronic signatures via /pdf or facsimile shall be contemplated hereunder.

14.12 Waiver of Right to Trial by Jury. THE COMPANY AND THE LENDERS WAIVE ANY RIGHT TO TRIAL BY JURY ON ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION (a) ARISING UNDER ANY OF THE LOAN DOCUMENTS OR (b) IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE DEALINGS OF THE COMPANY OR THE LENDERS WITH RESPECT TO ANY OF THE LOAN DOCUMENTS OR THE TRANSACTIONS RELATED HERETO OR THERETO, IN EACH CASE WHETHER SOUNDING IN CONTRACT OR TORT OR OTHERWISE. THE COMPANY AND THE LENDERS AGREE AND CONSENT THAT ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY, AND THAT ANY PARTY TO THIS AGREEMENT MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE COMPANY AND THE LENDERS TO THE WAIVER OF THEIR RIGHT TO TRIAL BY JURY. THE COMPANY ACKNOWLEDGES THAT IT HAS HAD THE OPPORTUNITY TO CONSULT WITH COUNSEL REGARDING THIS SECTION, THAT IT FULLY UNDERSTANDS ITS TERMS, CONTENT AND EFFECT, AND THAT IT VOLUNTARILY AND KNOWINGLY AGREES TO THE TERMS OF THIS SECTION.

15. AGREEMENTS REGARDING PAYMENTS TO THE LENDERS.

15.1 Payments of Principal, Interest and Fees. After Agent’s receipt of any principal or interest payments under this Agreement, Agent agrees to remit promptly to the Lenders their respective Percentage Share of such payments.

16. AGENCY.

16.1 Appointment of Agent; Powers. Each Lender hereby irrevocably designates and appoints Robert J. Pallé to act as agent for such Lender under this Agreement and the other Loan Documents, and irrevocably authorizes Robert J. Pallé, as Agent for such Lender, to take such action on its behalf under the provisions of this Agreement and the other Loan Documents, and to exercise such powers and perform such duties as are expressly delegated to Agent by the terms of this Agreement and the other Loan Documents, together with such other powers as are reasonably incidental thereto. In performing its functions under this Agreement, Agent is acting solely as an agent of the Lenders, and Agent does not assume, and shall not be deemed to have assumed, an agency or other fiduciary relationship with the Company. Agent shall not have any (a) duty, responsibility, obligation or liability to any Lender, except for those duties, responsibilities, obligations and liabilities expressly set forth in this Agreement, or (b) fiduciary relationship with any Lender, and no implied covenants, functions, responsibilities, duties, obligations or liabilities shall be read into this Agreement or the other Loan Documents, or otherwise exist against Agent.

16.2 Delegation of Agent’s Duties. Agent may execute any of its duties under this Agreement and all ancillary documents by or through agents or attorneys, and shall be entitled to the advice of counsel concerning all matters pertaining to such duties.

16.3 Disclaimer of Agent’s Liabilities. Agent shall not be liable to any Lender for any action lawfully taken or not taken by Agent under or in connection with the Agreement and the other Loan Documents (except for Agent’s or such person’s gross negligence or willful misconduct). Without limiting the generality of the foregoing, Agent shall not be liable to the Lenders for (a) any recital, statement, representation or warranty made by the Company or any officer thereof contained in (i) this Agreement, (ii) any other Loan Document or (iii) any certificate, report, audit, statement or other document referred to or provided for in this Agreement or received by Agent under or in connection with this Agreement, (b) the value, validity, effectiveness, enforceability or sufficiency of this Agreement, the other Loan Documents or Agent’s security interests in the Collateral, (c) any failure of the Company to perform their respective obligations under this Agreement and the other Loan Documents, (d) any loss or depreciation in the value of, delay in collecting the proceeds of, or failure to realize on, any Collateral, (e) Agent’s delay in the collection of the Obligations or enforcing Agent’s rights against the Company, or the granting of indulgences or extensions to the Company or any account debtor of the Company, or (f) for any mistake, omission or error in judgment in passing upon or accepting any Collateral. In addition, Agent shall have no duty or responsibility to ascertain or to inquire as to the observance or performance of any of the terms, conditions, covenants or other agreements of the Company contained in this Agreement or the other Loan Documents, or to inspect, verify, examine or audit the assets, books or records of the Company at any time.

16.4 Reliance and Action by Agent. Agent shall be entitled to rely, and shall be fully protected in relying, upon legal counsel, independent public accountants and experts selected by Agent, and shall not be liable to the Lenders for any action taken or not taken in good faith based upon the advice of such counsel, accountants or experts. In addition, Agent shall be entitled to rely, and shall be fully protected in relying, upon any note, writing, resolution, notice, consent, certificate, affidavit, letter, telecopy, telex or teletype message, statement, order or other document believed by Agent in good faith to be genuine and correct, and to have been signed, sent or made by the proper person or persons. Agent shall be fully justified in taking or refusing to take any action under this Agreement and the other Loan Documents unless Agent (a) receives the advice or consent of the Lenders or the Required Lenders, as the case may be, in a manner that Agent deems appropriate, or (b) is indemnified by the Lenders to Agent’s satisfaction against any and all liability, cost and expense which may be incurred by Agent by reason of taking or refusing to take any such action. Agent shall in all cases be fully protected in acting, or in refraining from acting, under this Agreement and the other Loan Documents in accordance with a request of all the Lenders or the Required Lenders, as the case may be, and such request and any action taken or failure to act pursuant thereto shall be binding upon all the Lenders.

16.5 Events of Default. Agent shall not be deemed to have knowledge or notice of the occurrence of any Event of Default hereunder unless Agent has received notice from the Company or a Lender describing such Event of Default with specificity. In the event that Agent receives such a notice, Agent shall promptly give notice thereof to all the Lenders. Agent shall take such action with respect to such Event of Default as shall be reasonably directed by the Lenders or Required Lenders, as the case may be, provided that (a) if appropriate, Agent may require indemnification from the Lenders under Section 16.4 prior to taking such action, (b) under no circumstances shall Agent have an obligation to take any action that Agent believes in good faith would violate any law or any provision of this Agreement or the other Loan Documents, and (c) unless and until Agent shall have received direction from the Lenders or Required Lenders, as the case may be, Agent shall not be obligated to take such action or refrain from taking action with respect to such Event of Default.

16.6 Lenders’ Due Diligence. Each Lender expressly acknowledges that Agent has not made any representation or warranty to such Lender regarding the transactions contemplated by this Agreement or the financial condition of the Company, and such Lender agrees that no action taken by Agent hereafter, including any review of the business or financial affairs of the Company, shall be deemed to constitute a representation or warranty by Agent to any Lender. Each Lender also acknowledges that such Lender has, independently and without reliance upon Agent or any other Lender and based solely on such documents and information as such Lender has deemed appropriate (and with the advice and assistance of such legal counsel as such Lender has deemed appropriate), made its own independent (a) determination of the adequacy, efficacy, sufficiency, validity and enforceability of the Agreement and the other Loan Documents, (b) credit analysis, appraisal of, and investigation into the business, operations, property, financial condition, Collateral and creditworthiness of the Company, and (c) decision to enter into this Agreement. Each Lender agrees, independently and without reliance upon Agent or any other Lender and based on such documents and information as such Lender shall deem appropriate at the time, (i) to continue to make its own credit analyses and appraisals in deciding whether to take or not take action under this Agreement and (ii) to make such investigations as such Lender deems necessary to inform itself as to the business, operations, property, financial condition and creditworthiness of the Company.

16.7 Right to Indemnification. The Lenders, jointly and severally, shall defend, indemnify and hold harmless Agent (and Agent’s heirs, successors and assigns) (to the extent not reimbursed by the Company and without limiting the obligation of the Company to do so), from and against any and all liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements of any kind whatsoever which may at any time be imposed on, incurred by or asserted against Agent in any way relating to or arising out of (a) this Agreement or any other Loan Document, (b) the transactions contemplated hereby or (c) any action taken or not taken by Agent under or in connection with any of the foregoing, provided that no Lender shall be liable for the payment of any portion of such liabilities, obligations, losses, damages, penalties, actions, judgments, suits, costs, expenses or disbursements resulting solely from Agent’s gross negligence or willful misconduct.

16.8 Other Transactions. Agent and any Lender may make loans to and generally engage in any kind of business with the Company, as though Agent or such Lender were not Agent or a Lender hereunder. With respect to loans made by Agent under this Agreement as a Lender, Agent shall have the same rights and powers, duties and liabilities under this Agreement and the other Loan Documents as any other Lender, and may exercise the same as though it was not Agent, and the term “Lender” and “Lenders” shall include Agent in its individual capacity as such.

16.9 Resignation of Agent; Removal of Agent. Agent may resign as Agent upon thirty (30) days’ notice to the Lenders, and such resignation shall be effective on the earlier of (a) the appointment of a successor Agent by the Lenders or (b) the date on which such 30-day period expires. If Agent provides the Lenders with notice of its intention to resign as Agent, the Lenders agree to appoint a successor to Agent as promptly as possible thereafter, whereupon such successor shall succeed to the rights, powers and duties of Agent, and the term “Agent” shall mean such successor effective upon its appointment. Upon the effective date of Agent’s resignation, such Agent’s rights, powers and duties as Agent hereunder immediately shall terminate, without any other or further act or deed on the part of such former Agent or any of the parties to this Agreement. After an Agent’s resignation hereunder, the provisions of this Section 16 shall continue to inure to such Agent’s benefit as to any actions taken or not taken by such Agent while acting as Agent.

16.10 Voting Rights; Agent’s Discretionary Rights.

(a) Notwithstanding anything contained in this Agreement to the contrary, without the prior written consent of Required Lenders, Agent will not agree to:

(i) amend or waive the Company’s compliance with any term or provision of this Agreement; or

(ii) except as otherwise expressly permitted or required hereunder, release any Collateral.

(b)  In all other respects Agent is authorized to take or to refrain from taking any action which Agent, in the exercise of its reasonable business judgment, deems to be advisable and in the best interest of the Lenders, unless this Agreement specifically requires the Company or Agent to obtain the consent of, or act at the direction of, the Required Lenders.

16.11 Deemed Consent. If a Lender’s consent to a waiver amendment or other course of action is required under the terms of this Agreement and such Lender does not respond to any request by Agent for such consent within five (5) Business Days after the date of such request, such failure to respond shall be deemed a consent to the requested course of action.

16.12 Survival of Agreements of the Lenders. The obligations of the Lenders set forth in Section 16.7 hereof shall survive the termination of this Agreement.

[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]

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

Signature page to Senior Subordinated Convertible Loan and Security Agreement between Blonder Tongue Laboratories, Inc, as Borrower, Robert J. Pallé as Agent, and the lenders from time to time party hereto as Lenders.

Signature page to Senior Subordinated Convertible Loan and Security Agreement between Blonder Tongue Laboratories, Inc, as Borrower, Robert J. Pallé as Agent, and the lenders from time to time party hereto as Lenders.

Signature page to Senior Subordinated Convertible Loan and Security Agreement between Blonder Tongue Laboratories, Inc, as Borrower, Robert J. Pallé as Agent, and the lenders from time to time party hereto as Lenders.

Signature page to Senior Subordinated Convertible Loan and Security Agreement between Blonder Tongue Laboratories, Inc, as Borrower, Robert J. Pallé as Agent, and the lenders from time to time party hereto as Lenders.

Signature page to Senior Subordinated Convertible Loan and Security Agreement between Blonder Tongue Laboratories, Inc, as Borrower, Robert J. Pallé as Agent, and the lenders from time to time party hereto as Lenders.

Signature page to Senior Subordinated Convertible Loan and Security Agreement between Blonder Tongue Laboratories, Inc, as Borrower, Robert J. Pallé as Agent, and the lenders from time to time party hereto as Lenders.

Exhibit A

Confirmation of Tranche [A/B/C] Conversion Price

On this ___ day of April, 2020, the undersigned acknowledge and agree, for the benefit of the Company and the Tranche [A/B/C] Lenders under that certain Senior Subordinated Convertible Loan and Security Agreement between Blonder Tongue Laboratories, Inc., as borrower, Robert J. Pallé, as Agent, and the Lenders from time to time party thereto (the “Agreement”), that the Tranche [A/B/C] Conversion Price under and as defined in Section 1.1(u)[(i)/(ii)/(iii)] of the Agreement is _______________________($___) per share of Common Stock, subject to adjustment as more fully set forth in the Agreement.

Exhibit 10.2

CONSENT AND AMENDMENT TO LOAN AGREEMENT AND LOAN DOCUMENTS

This CONSENT AND AMENDMENT TO LOAN AGREEMENT AND LOAN DOCUMENTS (this “Amendment”) is made this 7th day of April, 2020 by and among MidCap Business Credit LLC, a Texas limited liability company, the secured party hereunder (hereinafter called “Lender”), BLONDER TONGUE LABORATORIES, INC., a Delaware corporation (together with its successors and permitted assigns, “Borrower”), R. L. DRAKE HOLDINGS, LLC, a Delaware limited liability company (together with its permitted successors and assigns, “Drake”), and BLONDER TONGUE FAR EAST, LLC, a Delaware limited liability company (together with its permitted successors and assigns, “Far East”). Each of Borrower, Drake and Far East are individually referred to herein as a “Loan Party” and individually, collectively, jointly and severally, the “Loan Parties”.

WHEREAS, the Loan Parties and Lender have entered that Loan and Security Agreement (All Assets) dated as of October 25, 2019 (as amended, the “Loan Agreement”).

WHEREAS, Borrower has requested that the Loan Agreement be amended to, among other things, modify the availability block as described therein, and Lender is willing to make such modifications to the Loan Agreement, subject to the terms and conditions set forth herein.

WHEREAS, Borrower has also requested Lender’s consent to certain subordinated debt transactions as described here, and Lender is willing to provide such consent, subject to the terms and conditions set forth herein.

NOW THEREFORE, in consideration of the foregoing premises and the mutual benefits to be derived by the Loan Parties and Lender from a continuing relationship under the Loan Agreement and Loan Documents and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the parties hereto agree as follows:

1. Defined Terms. Capitalized terms used in this Amendment which are defined in the Loan Agreement shall have the same meanings as defined therein, unless otherwise defined herein.

2. Consent. Borrower desires to obtain secured subordinated convertible indebtedness of up to $1,500,000 (such proposed transaction, the “Transaction”) will be consummated by the execution of (i) that certain Senior Subordinated Convertible Loan and Security Agreement (as amended or modified from time to time in accordance with the Loan Agreement, the “Subordinated LSA”) and (ii) certain other agreements and documents to be delivered in connection therewith (such documents, including all documents, instruments and agreements ancillary thereto, the “Transaction Documents”). As used hereinafter, the term “Subordinated Debt Initial Funding Date” means the date on which Lender shall have received:

(a) copies of the Transaction Documents, duly executed and delivered by each of the parties thereto, which Transaction Documents (i) shall be acceptable to Lender in its discretion, and (ii) shall contain a commitment by the subordinated lenders party thereto to provide subordinated loans to the Borrower in a principal amount of at least $500,000;

(b) a subordination agreement with respect to the Transaction acceptable to Lender in its discretion, properly executed and delivered by the parties thereto; and

(c) evidence of Borrower’s receipt of a principal amount of at least $500,000 of subordinated indebtedness pursuant to the Subordinated LSA.

Without the consent of Lender, the consummation of the Transaction would be prohibited under the terms and conditions of the Loan Agreement. Subject to the terms and conditions hereof, including the execution of a subordination agreement by the requisite parties in favor of Lender in form and substance satisfactory to Lender, Lender hereby consent to the consummation of the Transaction and the execution and delivery of the Transaction Documents. Without limiting the generality of the foregoing, upon the satisfaction of the conditions hereof, Lender hereby agrees that the Transaction and the Transaction Documents will not violate any provision of the Loan Agreement or any of the other Loan Documents or otherwise result in an Event of Default (as defined in the Loan Agreement) thereunder. This consent is limited to the Transaction described above and is not, nor shall it be construed as, consent to any other transactions, including any that would constitute an Event of Default under the Loan Agreement or Loan Documents.

3. Amendments to Loan Agreement. The Loan Agreement is hereby amended as follows:

(a) Section 5(a). Effective upon the Subordinated Debt Initial Funding Date, Section 5(a) is hereby amended to delete the third sentence thereof and replace it with the following:

“Borrower agrees that the aggregate unpaid principal of all Revolving Loans outstanding at any one time shall not exceed the lesser of (I) the Credit Limit, and (II) the Borrowing Base (as defined below) less, so long as Section 15(n) is still in effect, the Availability Block.”

(b) Section 13(a)(xiv). As of the date hereof, Section 13(a)(xiv) is hereby restated in its entirety as follows:

(xiv) within thirty (30) days after the end of each fiscal quarter, a schedule of indebtedness of the Loan Parties outstanding as of such fiscal quarter end, in a form consistent with Schedule “D”;

(c) Section 15(c). Effective on the Subordinated Debt Initial Funding Date, Section 15(c) is hereby amended to replace the “and” before clause (xiv) with a “,” and add the following after the end of such clause (xiv) of such section prior to the end of the sentence:

and (xv) Liens securing the Subordinated Debt so long as such Liens have been subordinated to the Liens of Lender on terms and conditions satisfactory to Lender.

(d) Section 15(g). As of the date hereof, Section 15(g) is hereby restated in its entirety as follows:

(g) (Indebtedness) issue evidence of indebtedness or suffer to exist indebtedness in addition to indebtedness to Lender except (i) indebtedness or liabilities of a Loan Party other than for money borrowed, incurred or arising in the ordinary course of business, (ii) indebtedness of a Loan Party for money borrowed which has been subordinated on terms and conditions satisfactory to Lender, (iii) indebtedness relating to Liens permitted under Section 15(c)(iii), or (iv) unsecured indebtedness of Borrower for money borrowed pursuant to and in compliance with the Paycheck Protection Program that is 100% guaranteed by the U.S. Small Business Administration in accordance with such program in an aggregate principal amount not to exceed $2,000,000 or such higher amount as approved in writing by Lender in its sole discretion;

(e) Section 15(m). Effective upon the Subordinated Debt Initial Funding Date, Section 15(m) is hereby restated in its entirety as follows:

(m) (Subordinated Debt Payments; Amendments of Certain Agreements)

(i) make any principal or interest repayments with respect to the debts of a Loan Party other than (I) those to Lender, (II) to the extent not forgiven in accordance with the CARES Act and so long as no Event of Default has occurred and is continuing or will occur as a result or immediately following such payment, regularly scheduled payments, but not prepayments, of interest and principal in respect of indebtedness permitted under Section 15(g)(iv), (III) those debts which are subordinated to the right of payment to the Obligations of Lender on terms and conditions reasonably satisfactory to Lender, or (IV) payments relating to down/out streaming of cash to Affiliates of Borrower, provided that any such payments made under (III) or (IV) may only be made so long as (w) no Event of Default has occurred and is continuing or will occur as a result or immediately following such payment, (x) Excess Availability is no less than $800,000 prior to and immediately following any such payment, (y) the Loan Parties shall not have made any Distributions during the period commencing on the closing date of the First Amendment and ending on the six (6) month anniversary of the closing date of the First Amendment, and (z) such payments are expressly permitted in accordance with the applicable subordination agreement; or

(ii) amend or modify any Subordinated Debt Documents or any other agreement, instrument or document evidencing or relating to any such subordinated indebtedness, including the Subordinated Debt, except in accordance with the subordination agreement relative thereto or the subordination provisions thereof.

(f) Section 15(n). Effective upon the Subordinated Debt Initial Funding Date, Section 15(n) is hereby restated in its entirety as follows:

(n) (Minimum Excess Availability) permit, allow, or otherwise not maintain Excess Availability in an amount equal to the Availability Block currently in effect for the applicable period, or more.

(g) Section 15(q). As of the date hereof, a new Section 15(q) is hereby added to the Loan Agreement immediately following Section 15(p), as follows:

(q) (Minimum EBITDA). Borrower’s EBITDA shall not be less than the minimum EBITDA as set forth in the chart below, for the corresponding “Time Period” set forth in the chart below, to be tested as of the “Test Date” set forth in the chart below; provided, that such Minimum EBITDA covenant shall not be tested until the occurrence, if any, of a Minimum EBITDA Covenant Trigger Event, and after the occurrence, if any, of a Minimum EBITDA Covenant Trigger Event, (x) such Minimum EBITDA covenant shall be tested (i) as of the Test Date applicable to the calendar month during which the Minimum EBITDA Covenant Trigger Event occurred, and (ii) as of each Test Date and for each Time Period thereafter as set forth below, and (y) on each such Test Date referred to in clause (x) of this sentence, Borrower shall provide Lender with a duly executed Compliance Certificate with evidence to Lender’s satisfaction showing that Borrower is in compliance with the applicable Minimum EBITDA covenant requirement:

(h) Section 22(p).

(i) As of the date hereof, Section 22(p) is hereby amended to add the following definitions in the proper alphabetical location in such section:

“CARES Act” means the Coronavirus Aid, Relief and Economic Security Act (H.R. 748).

“Earnings Before Taxes” means pretax earnings of Borrower, excluding extraordinary gains, extraordinary losses, and minority interests.

“EBITDA” means for any period, the sum of (i) Earnings Before Taxes, plus (ii) Interest Expense, plus (iii) depreciation, depletion, and amortization of tangible and intangible assets, computed and calculated in accordance with GAAP, plus (iv) the Permitted EBITDA Add-Back Amount.

“First Amendment” means that certain Consent and Amendment to Loan Agreement and Loan Documents dated as of April 7, 2020 which amended this Agreement.

“Minimum EBITDA Covenant Trigger Event” means the failure of the Loan Parties to maintain Excess Availability in an amount equal to $400,000 or more for any three (3) Business Days in any calendar month (whether such failure occurs on three (3) consecutive Business Days or not).

“Paycheck Protection Program” means the Paycheck Protection Program established under Section 1102 of the CARES Act.

“Permitted EBITDA Add-Back Amount” means, for any period, an amount equal to the sum of: (i) the aggregate amount of any non-cash intangible asset impairment expenses incurred by Borrower during such period to the extent recognized in accordance with GAAP and in an aggregate amount not exceeding $2,800,000 during the term of this Agreement plus (ii) the aggregate amount of any non-cash expenses incurred by Borrower in connection with the termination of any pension plan in accordance with resolutions adopted by such Person’s board of directors, to the extent that such expense reduces Borrower’s consolidated net income (loss), plus (iii) the amount of any non-cash inventory reserve established by Borrower, as set forth in Borrower’s financial statements from time to time during such period, in an amount not exceeding $1,000,000 for any twelve-month period and only to the extent such reserve(s) reduce Borrower’s consolidated net income (loss), plus (iv) the amount of any non-cash equity-based compensation and other remuneration expenses of Borrower during such period, plus (v) fees, costs and expenses (including, without limitation attorneys’ fees) incurred by Borrower during such period in connection with the preparation, negotiation and closing of the transactions contemplated by this Agreement and the transactions contemplated by the Subordinated Debt Documents, plus (vi) one-time restructuring charges (including severance payments) incurred by Borrower that are associated with the implementation of cost reduction programs from June 30, 2019 through Fiscal Year 2020, so long as incurred on or prior to March 31, 2021 and in an aggregate amount not exceeding $600,000, plus (vii) the amount of any non-cash derivatives liability of Borrower incurred in connection with embedded components of convertible instruments accounted for in accordance with Topic 815, but only to the extent such amounts reduce Borrower’s consolidated net income (loss).

(ii) Effective as of the Subordinated Debt Initial Funding Date, Section 22(p) is hereby amended to add the following definitions in the proper alphabetical location in such section:

“Availability Block” means (i) as of the date of the First Amendment through May 31, 2020, an amount equal to $0, (ii) as of June 1, 2020, an amount equal to $6,666.66, and continuing on the first Business Day of each succeeding month thereafter, such amount shall increase by $6,666.66 per such applicable date until such amount reaches $400,000, and (iii) at all times thereafter, an amount equal to $400,000.

“Subordinated Debt” means all obligations of the Loan Parties in respect of the Subordinated Debt Documents.

“Subordinated Debt Documents” means that certain Senior Subordinated Convertible Loan and Security Agreement referenced in the First Amendment, and the other “Loan Documents” as that term is defined in such loan and security agreement, each as amended or modified from time to time in accordance herewith and the applicable subordination agreement.

(i) Exhibits. The Form of Compliance Certificate attached as Exhibit 3 to the Loan Agreement is hereby replaced in its entirety with Exhibit 1 attached hereto.

4. Post Closing Requirements. Reference is hereby made to that certain Post Closing Conditions Letter dated October 25, 2019 (the “PC Letter”). Effective as of January 31, 2020, item 2 on the Exhibit A to the PC Letter is hereby restated in its entirety as follows:

“2. Borrower shall deliver to Lender an endorsement to its credit insurance policy number 5114974 issued by Euler Hermes North America Insurance Company, which such endorsement shall be consistent with that certain Policy Beneficiary Form executed by Lender and Borrower as of April 1, 2020 and otherwise in form and substance satisfactory to Lender.

Timing: On or before April 30, 2020.”

Notwithstanding anything to the contrary contained in the Loan Documents, the Loan Parties each agree the failure to comply with this Section 4 shall constitute an Event of Default under the Loan Agreement.

5. Paycheck Protection Program Loan. Notwithstanding anything to the contrary in the Loan Agreement or Loan Documents, with respect to money borrowed by Borrower pursuant to the Paycheck Protection Program and permitted under Section 15(g)(iv) of the Loan Agreement (as amended by this Amendment) (the “PPP Loan”), the parties hereto agree as follow:

6. Amendment Fee. Borrower agrees to pay Lender as of the date hereof a fully earned, non-refundable fee in the amount of $10,000 in consideration of the execution by Lender of this Amendment (“Amendment Fee”).

7. Conditions to Closing. The willingness of Lender to enter into this Amendment shall be subject to the condition precedent that Lender shall have received all of the following, each in form and substance satisfactory to Lender:

8. Representations and Warranties. Each Loan Party represents and warrants to Lender that such Loan Party has the full power and authority to execute, deliver and perform its obligations under, this Amendment and the execution and delivery of this Amendment have been duly authorized by all necessary action of the stockholders, directors, members and managers, as applicable, of such Loan Party.

9. Release and Confirmation. Each Loan Party hereby (i) reaffirms that it remains indebted to Lender without defense, counterclaim or offset and, assuming effectiveness of this Amendment, no default or Event of Default has occurred or exists under the Loan Documents, (ii) restates, and reaffirms, all of its covenants, representations and warranties set forth in the Loan Documents to the same extent as if fully set forth herein and each Loan Party hereby certifies that after giving effect to this Amendment, all such covenants, representations and warranties are true and accurate as of the date hereof and (iii) acknowledges and warrants that it does not have any claims, actions or causes of action whatsoever in law or in equity against Lender, its’ officers, directors, employees, agents, successors, subsidiaries, related companies or attorneys (for the purpose of this paragraph, collectively referred to herein as the “Lenders”) or any of them, in connection with or related to or arising from any and all transactions with Lenders, whether known or unknown, including, but not limited to, the loans, through the date of this Amendment, and each Loan Party for good and valuable consideration hereby waives, remises, releases and discharges any and all rights with respect to such claims, additions or causes of action, if any.

10. Counterparts. This Amendment may be executed in one or more counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which taken together shall constitute but one and the same agreement. Counterpart signature pages to this Amendment transmitted by facsimile transmission, by electronic mail in “portable document format” (“.pdf”) form, or by any other electronic means intended to preserve the original graphic and pictorial appearance of a document, will have the same effect as physical delivery of the paper document bearing an original signature.

11. References. Upon and after the date of this Amendment all references to the Loan Agreement in the Loan Documents, or in any related document, shall mean the Loan Agreement as amended by this Amendment. Except as expressly provided in this Amendment, the execution and delivery of this Amendment does not and will not amend, modify or supplement any provision of, or constitute a consent to or a waiver of any noncompliance with the provisions of the Loan Agreement, and, except as specifically provided in this Amendment, the Loan Agreement shall remain in full force and effect in accordance with the respective terms thereof.

12. Loan Documents Ratified. This Amendment is executed as an instrument under seal and shall be governed by and construed in accordance with the laws of the State of Connecticut without regard to its conflicts of law rules. All parts of the Loan Agreement and the other Loan Documents, not affected by this Amendment are hereby ratified and affirmed in all respects, provided that if any provision of the Loan Documents shall conflict or be inconsistent with this Amendment, the terms of this Amendment shall supersede and prevail.

13. Costs and Expenses. Each Loan Party hereby reaffirms its agreement under the Loan Agreement to pay or reimburse Lender on demand for all costs and expenses incurred by Lender in connection with the Loan Documents, including without limitation all reasonable fees and disbursements of legal counsel. Without limiting the generality of the foregoing, each Loan Party specifically agrees to pay all fees and disbursements of counsel to Lender for the services performed by such counsel in connection with the preparation of this Amendment and the documents and instruments incidental hereto. Each Loan Party hereby agrees that Lender may, at any time or from time to time in its sole discretion and without further authorization by the Loan Party, make a loan to Borrower under the Loan Agreement, or apply the proceeds of any loan, for the purpose of paying any such fees, disbursements, costs and expenses.

[SIGNATURES CONTINUED ON FOLLOWING PAGE]

IN WITNESS WHEREOF, the parties have executed this Amendment under seal as of the day and year first above written.

[Consent and Amendment to Loan Agreement and Loan Documents] 

EXHIBIT 1 CONSENT AND AMENDMENT TO LOAN AGREEMENT AND LOAN DOCUMENTS

EXHIBIT 3

MIDCAP BUSINESS CREDIT LLC

FORM OF COMPLIANCE CERTIFICATE

Please refer to the Loan and Security Agreement (All Assets) dated as of October 25, 2019 (as amended, restated, supplemented or otherwise modified from time to time, (the “Loan Agreement”), among BLONDER TONGUE LABORATORIES, INC., other loan parties, and MIDCAP BUSINESS CREDIT LLC. Terms used but not otherwise defined herein are used herein as defined in the Loan Agreement.

 Borrower has caused this Certificate to be executed and delivered by its chief financial officer on _________, ____.

SCHEDULE 1 – COMPLIANCE CERTIFICATE

Computation Date: [_____________]

10

Exhibit 10.3

SUBORDINATION AGREEMENT

THIS SUBORDINATION AGREEMENT, dated as of April 8, 2020, is by and between MIDCAP BUSINESS CREDIT LLC, a Texas limited liability company, as the Senior Lender (as defined below) under the Senior Loan Documents (as defined below), and the Junior Creditor under the Junior Debt Documents (as each term is defined below), and is acknowledged by, BLONDER TONGUE LABORATORIES, INC., a Delaware corporation (together with its successors and permitted assigns, “Borrower”), R. L. DRAKE HOLDINGS, LLC, a Delaware limited liability company (together with its permitted successors and assigns, “Drake”), and BLONDER TONGUE FAR EAST, LLC, a Delaware limited liability company (together with its permitted successors and assigns, “Far East”). Each of Borrower, Drake and Far East are individually referred to herein as a “Loan Party” and individually, collectively, jointly and severally, “Loan Parties”.

RECITALS:

A. Loan Parties and Senior Lender have entered into the Senior Loan Agreement (as further defined below) pursuant to which Senior Lender has made, upon certain terms and conditions, loans and provided other financial accommodations to Borrower, secured by a security interest in all or substantially all of the assets and properties including, without limitation, any real property of Loan Parties.

B. Junior Creditor has made one or more loans and other financial accommodations to Borrower, and Borrower’s repayment and other obligations with respect to such loans and financial accommodations are evidenced by the Junior Debt Documents (as defined below).

C. Senior Lender and Junior Creditor wish to enter into this Subordination Agreement to subordinate the Junior Debt (as hereinafter defined) to the Senior Debt (as hereinafter defined) and the Junior Liens to the Senior Liens in favor of Senior Lender.

In consideration of the mutual benefits accruing to the parties hereunder, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, Senior Lender and Junior Creditor hereby agree as follows:

1. DEFINITIONS.

As used in this Subordination Agreement, the following terms shall have the following meanings:

1.1 “Agreements” shall mean, collectively, the Senior Loan Documents and the Junior Debt Documents, and “Agreement” shall mean any one of them, as the context requires.

1.2 “Bankruptcy Code” shall mean Title 11 of the United States Code (as amended from time to time and any successor statute).

1.3 “Bankruptcy Law” shall mean the Bankruptcy Code and any similar federal, state or foreign bankruptcy, insolvency, reorganization or other law of any jurisdiction affecting creditors’ rights generally.

1.4 “Borrower” shall have the meaning set forth in the preamble of this Subordination Agreement.

1.5 “Business Day” shall mean any day, other than a Saturday, Sunday, or other day on which commercial banks are authorized or required to close under the laws of the State of Connecticut and a day on which Senior Lender and Junior Creditor are open for the transaction of business.

1.6 “Collateral” shall mean all assets and properties of any kind or character whatsoever, real or personal, tangible or intangible, and wherever located, whether now owned or hereafter acquired, upon which a Lien is now or hereafter granted by any Obligor or otherwise exists in favor of any Creditor.

1.7 “Control Collateral” means any Collateral consisting of a deposit account (as defined in the UCC) which as of the date of this Subordination Agreement is subject to a deposit account control agreement in favor of Senior Lender.

1.8 “Creditors” or “Creditor” shall mean, collectively, Senior Lender and Junior Creditor, and their respective successors and assigns.

1.9 “Default” shall mean an event that with the passage of any notice or cure period would become a default under any Agreement.

1.10 “Event of Default” shall mean a default or event of default under, as such term is used and defined in, any Agreement.

1.11 “Insolvency Proceeding” shall mean, as to any Person, any of the following: (a) any case or proceeding with respect to such Person under the Bankruptcy Code, or any other Bankruptcy Law or any other or similar proceedings seeking any stay, reorganization, arrangement, composition or readjustment of the obligations and indebtedness of such Person, (b) any proceeding seeking the appointment of any trustee, receiver, liquidator, custodian or other insolvency official with similar powers with respect to such Person or any of its assets, (c) any proceeding for liquidation, dissolution or other winding up of the business of such Person, or (d) any assignment for the benefit of creditors or any marshaling of assets of such Person.

1.12 “Junior Agent” shall mean Robert J. Pallé in his capacity as agent for the Junior Lenders under the Junior Debt Documents.

1.13 “Junior Creditor” shall mean, collectively, Junior Agent and Junior Lenders.

1.14 “Junior Debt” shall mean all obligations, liabilities and indebtedness of every kind, nature and description owing by any Obligor to Junior Creditor arising under the Junior Debt Documents and every other indebtedness, liability and obligation of every type and description which any Obligor may now or at any time hereafter owe to Junior Creditor, whether direct or indirect, absolute or contingent, joint or several, due or not due, primary or secondary, liquidated or unliquidated, including principal, interest, charges, fees, costs, indemnities and expenses, however evidenced, whether as principal, surety, endorser, guarantor or otherwise, whether now existing or hereafter arising, whether arising before, during or after the initial or any renewal term of the Junior Debt Documents or after the commencement of any Insolvency Proceeding with respect to any Obligor (and including, without limitation, the payment of interest, fees, expenses and other amounts which accrue and become due after the commencement of such Insolvency Proceeding, whether or not such amounts are allowed or allowable in whole or in part in any such Insolvency Proceeding); provided that, Junior Debt shall not include (i) any amount owing from time to time to any Junior Creditor in respect of salary or bonuses payable in the ordinary course of Junior Creditor’s employment by an Obligor in accordance with past practices as well as the payment or reimbursement in accordance with past practices of travel, entertainment or other business expenses incurred in the ordinary course of the Junior Creditor’s services as an employee, director or officer of an Obligor, or (ii) Junior Creditor’s rights under the Junior Debt Documents to convert all or any portion of the Junior Debt into capital stock of any Obligor as contemplated by the Junior Loan Agreement (“Excluded Junior Debt”).

1.15 “Junior Debt Documents” shall mean the Junior Loan Agreement, the Junior Security Documents, the Continuing Guaranty dated on or about the date hereof by Drake in favor of Junior Creditor, and all other notes, agreements, documents and instruments at any time entered into, executed or delivered by any Obligor or any other person with, to or in favor of Junior Creditor in connection therewith or related thereto, as all of the foregoing now exist or, in accordance with the terms hereof, may hereafter be amended, modified, supplemented, extended, renewed, restated, replaced or refinanced.

1.16 “Junior Lenders” means, collectively, (a) MidAtlantic IRA, LLC FBO Steven L. Shea, Carol M. Pallé and Robert J. Pallé (jointly and severally), Anthony J. Bruno, Stephen K. Necessary, and Livewire Ventures, LLC as “Lenders” under and as defined in the Junior Loan Agreement, (b) each other person who may from time to time become party to the Junior Loan Agreement as a lender thereunder, and (c) the permitted successors and assigns of the foregoing.

1.17 “Junior Lien” shall mean, collectively, the Liens and security interests granted by any Obligor in all or any part of the Collateral of such Obligor to or in favor of Junior Creditor under the Junior Security Documents as set forth therein and any and all other Liens of Junior Creditor in any Obligor’s assets or properties, or any Obligor’s rights, titles or interests therein or in respect thereof whether now existing or hereafter arising or acquired.

1.18 “Junior Loan Agreement” shall mean that certain Senior Subordinated Convertible Loan and Security Agreement dated on or about April 8, 2020 by and between Borrower, Junior Lenders and Junior Agent, as now exists or, in accordance with the terms hereof, as may hereafter be amended, modified, supplemented, extended, renewed, restated, replaced, refinanced or otherwise modified from time to time.

1.19 “Junior Security Documents” shall mean that certain IP Security Agreement and all other agreements, instruments, financing statements and other documents made or entered into in connection therewith or otherwise executed by Borrower or any other Obligors pursuant to which a Lien is granted to or for the benefit of Junior Agent or Junior Lenders, as any of the foregoing now exist or, in accordance with the terms hereof, as may hereafter be amended, restated, modified, extended or renewed from time to time.

1.20 “Lien” shall mean any right or interest in property securing an obligation owed to, or a claim by, a Person other than the owner of the property or any other arrangement with such Person which provides for the payment of such liabilities out of such property or assets or which allows such Person to have such liabilities satisfied out of such property or assets prior to the general creditors of any owner thereof, whether such interest is based on the common law, statute, or contract, and including a security interest, collateral assignment, charge, claim, or lien arising from a security agreement, mortgage, deed of trust, encumbrance, pledge, hypothecation, assignment, deposit arrangement, conditional sale, trust receipt, lease, consignment or bailment for security purposes or similar agreement, or any contingent or other agreement to provide any of the foregoing, but excluding any right of offset which arises without agreement in the ordinary course of business.

1.21 “Loan Parties” shall have the meaning set forth in the preamble of this Subordination Agreement.

1.22 “Obligors” shall mean, individually and collectively, Borrower, Loan Parties, and any other person liable on or in respect of the Senior Debt or the Junior Debt, and each of their successors and assigns, including, without limitation, a receiver, trustee or debtor-in-possession on behalf of such Person or on behalf of any such successor or assign.

1.23 “Paid in Full” shall mean the Senior Lender has received payment in full in cash of all of the Senior Debt and on which Senior Lender shall have no further obligation to make any loans or advances under the Senior Loan Documents and such Senior Loan Documents have been terminated. In the event that any Senior Lender Party is required by a decision of a court of competent jurisdiction (or by another governmental authority in a decision tantamount thereto) to return any payments received by it in respect of the Senior Debt after it had otherwise received payment in full, the Senior Debt to which such payment had been applied shall be reinstated as if it had never been repaid and a Senior Loan Termination Date (as defined below) shall not be deemed to have occurred (in which case, any actions taken hereunder as a result of the occurrence of the Senior Loan Termination Date shall be reversed and unwound retroactively).

1.24 “Person” shall mean any individual, sole proprietorship, partnership, corporation (including, without limitation, any corporation which elects Subchapter S status under the Internal Revenue Code of 1986, as amended), limited liability company, limited liability partnership, business or statutory trust, unincorporated association, joint stock company, trust, joint venture, or other entity or any government or any agency or instrumentality or political subdivision thereof.

1.25 “Proceeds” shall mean (a) all “proceeds” as defined in Article 9 of the UCC with respect to the Collateral, and (b) whatever is recoverable or recovered when Collateral is sold, exchanged, collected, or disposed of, whether voluntarily or involuntarily.

1.26 “Senior Debt” shall mean any and all obligations, liabilities and indebtedness, however evidenced, of every kind, nature and description owing by any Obligor to the Senior Lender arising under the Senior Loan Documents, whether direct or indirect, absolute or contingent, joint or several, due or not due, primary or secondary, liquidated or unliquidated, including principal, interest, charges, fees, costs, indemnities and expenses (including attorneys fees and other costs and expenses of collection), whether as principal, surety, endorser, guarantor or otherwise, whether now existing or hereafter arising, whether arising before, during or after the initial or any renewal term of the Senior Loan Agreement or after the commencement of any Insolvency Proceeding with respect to any Obligor (and including, without limitation, the payment of interest, fees, expenses and other amounts which accrue after the commencement of such Insolvency Proceeding whether or not such amounts are allowed or allowable in whole or in part in any such Insolvency Proceeding).

1.27 “Senior Lender” shall mean MidCap Business Credit LLC, with its participants, successors and assigns, including any other lender or group of lenders that at any time succeeds to or refinances, replaces or substitutes for all or any portion of the Senior Debt at any time and from time to time.

1.28 “Senior Liens” shall have the meaning set forth in Section 2.1.

1.29 “Senior Loan Amendment Closing Date” shall mean April 7, 2020.

1.30 “Senior Loan Agreement” shall mean that certain Loan and Security Agreement (All Assets) dated as of October 25, 2019 among the Loan Parties and Senior Lender, as amended by that certain Consent and Amendment to Loan Agreement and Loan Documents, dated as of April 7, 2020, as the same may hereafter be further amended, modified, supplemented, extended, renewed, restated, replaced or refinanced from time to time.

1.31 “Senior Loan Documents” shall mean the Senior Loan Agreement, the “Loan Documents” (as such term is defined in the Senior Loan Agreement) and all other agreements, documents and instruments at any time executed or delivered by any Obligor with, to or in favor of Senior Lender in connection therewith or related thereto, as any of the foregoing may be amended, modified, supplemented, extended, renewed, restated, replaced or refinanced from time to time.

1.32 “Senior Loan Termination Date” shall mean the date that the Senior Lender has been Paid in Full.

1.33 “Subordination Agreement” shall mean this agreement as may from time to time hereafter be amended, modified, supplemented, extended, renewed, restated or replaced.

1.34 “UCC” means the Uniform Commercial Code as in effect in the State of Connecticut from time to time.

All terms used herein and defined in the UCC, unless otherwise defined herein, shall have the meanings ascribed to such terms in the UCC as in effect on the date hereof. All references to any term in the plural shall include the singular and all references to any term in the singular shall include the plural.

2. SECURITY INTERESTS; PRIORITIES; REMEDIES.

2.1 Liens in Collateral. Junior Creditor hereby acknowledges that Senior Lender has been granted Liens upon the Collateral pursuant to the Senior Loan Documents (the “Senior Liens”) to secure the Senior Debt. Junior Creditor agrees that it will not contest or challenge the validity, perfection, priority or enforceability of the Senior Liens. Junior Creditor hereby agrees with Senior Lender that Junior Creditor shall not obtain or be granted any Liens in or upon the Collateral or any other assets or properties of any Obligor to secure the Junior Debt or other indebtedness or liabilities owing to it by the Obligors other than the Junior Liens.

2.2 Priority of Debt and Liens.

(a) Junior Creditor hereby, expressly and in all respects, subordinates and makes junior and inferior in all respects (i) all Junior Debt to the Senior Debt and (ii) the payment and enforcement of the Junior Debt to the payment and enforcement of the Senior Debt.

(b) Notwithstanding the order or time of attachment, or the order, time or manner of perfection, or the order or time of filing or recordation of any document, financing statement or instrument, or other method of perfecting a Lien in favor of a Creditor in any Collateral, and notwithstanding any conflicting or inconsistent terms or conditions which may be contained in any of the Agreements, the Senior Liens have and shall have priority over all Junior Liens, and such Junior Liens are and shall be junior and subordinate in right of payment and enforcement to the Senior Liens, in each case, regardless of whether the Senior Liens are heretofore, now or at any time hereafter valid, enforceable or perfected and regardless of the relative priority of the Junior Liens and the Senior Liens under the UCC.

(c) The priorities of the Liens provided in this Section 2.2 shall not be altered or otherwise affected by any amendment, modification, supplement, extension, renewal, restatement, replacement or refinancing of the Senior Debt or the Junior Debt, nor by any action or inaction which any Creditor may take or fail to take in respect of any Collateral.

2.3 Payments on Junior Debt. Solely for the benefit of Senior Lender Parties, Junior Creditor agrees that it will not demand, accept, hold or retain any payment or prepayment of principal, interest or any other amounts (whether in cash, property or by offset) in respect of the Junior Debt (including, without limitation, any balloon payment at maturity) prior to the Senior Loan Termination Date without the prior written consent of Senior Lender; provided, however, that Borrower may make regularly scheduled non-cash interest payments to Junior Creditor that are paid in kind by accretion to the principal balance of the Junior Debt; and provided further, that Borrower may make payments of interest and principal in cash to Junior Creditor so long as and only to the extent that (i) no Event of Default has occurred and is continuing under the Senior Loan Documents or will occur as a result or immediately following any such cash payment, (ii) the Loan Parties shall not have made any Distributions (as defined in the Senior Loan Agreement) during the period commencing on the Senior Loan Amendment Closing Date and ending on the six (6) month anniversary of the Senior Loan Amendment Closing Date, and (iii) Excess Availability (as defined in the Senior Loan Agreement) is no less than $800,000 prior to and immediately following any such cash payment. If any payment or prepayment on account of the Junior Debt not permitted to be made by any Obligor or any guarantor or other obligor of the Junior Debt, or accepted by Junior Creditor under this Agreement, is made and received by Junior Creditor, such payment or prepayment shall not be commingled with any of the assets of Junior Creditor, shall be held in trust by Junior Creditor for the benefit of the Senior Lender and shall be promptly paid over to Senior Lender for application (in accordance with the Senior Debt Documents) to the payment of the Senior Debt then remaining unpaid, until all of the Senior Debt is Paid in Full.

2.4 Rights of Senior Lender.

(a) If there shall occur any Insolvency Proceeding, in respect of any Obligor, the following provisions shall apply: (i) all Senior Debt shall first be Paid in Full, including without limitation, the principal thereof, premium, if any, and interest (including post-petition interest) due thereon before Junior Creditor or the holder of any Junior Debt is entitled to receive any payment on account of the principal of or interest on or any other amount owing in respect of the Junior Debt; (ii) any payment, dividend or distribution of assets of such Obligor of any kind or character whether in cash, property or securities to which Junior Creditor or the holder of the Junior Debt would be entitled except for the provisions of this Agreement, shall be paid by the liquidating trustee or agent or other person making such payment or distribution, whether a trustee in bankruptcy, a receiver or liquidating trustee or other trustee or agent, directly to Senior Lender, to the extent necessary until the Senior Debt is Paid in Full; (iii) in any such proceeding, Senior Lender is hereby irrevocably authorized and empowered (in the name of Junior Creditor or otherwise), but shall have no obligation, to demand, sue for, collect and receive every payment or distribution referred to in clauses (i) and (ii) of this subsection (a) and given acquittance therefor and to file claims and proofs of claim and take such other action as it may deem necessary or advisable for the exercise or enforcement of any of the rights or interests of the Senior Lender hereunder; and (iv) upon the failure of Junior Creditor to do so prior to 15 days before expiration of the time in which to vote, make or prove such claims in any Insolvency Proceeding, make, prove and vote any and all claims for the Junior Debt in such Insolvency Proceeding, regardless of the existence or value of any Collateral held by Senior Lender as security for payment of the Senior Debt, including, without limitation, voting such claims at any meeting of creditors of any Obligor and voting such claims for or against any proposed plan in any such Insolvency Proceeding, all as Senior Lender deems in its sole discretion appropriate to protect its interest.

(b) Junior Creditor authorizes Senior Lender, without notice, consent or demand and without affecting Junior Creditor’s obligations hereunder, from time to time: (i) to renew, extend, increase, accelerate or otherwise change the time for payment of the terms of, or the interest on, or otherwise alter any of the terms of the Senior Debt or any portion thereof; (ii) to take from any party and hold Collateral for the payment of the Senior Debt or any portion thereof, and to exchange, enforce or release such collateral or any portion thereof; (iii) to accept and hold any endorsement or guaranty of payment of the Senior Debt or any portion thereof and to release or substitute any such endorser or guarantor, or any party who has given any security interest in any collateral as security for the payment of the Senior Debt or any portion thereof, or any other party in any way obligated to pay the Senior Debt or any portion thereof; (iv) to direct the order or manner of the disposition of any and all other Collateral and the enforcement of any and all endorsements and guaranties relating to the Senior Debt or any portion thereof as Senior Lender, in its sole discretion, may determine; (v) to settle or compromise any of the Senior Debt or any security therefor; (vi) to modify, amend or restate any of the Senior Loan Documents or waive any of the provisions thereto; (vii) to file UCC-3 termination and release statements in connection with a sale of the Collateral, or any portion thereof, permitted under the terms of the Senior Loan Documents, in each case in form suitable for filing in relevant jurisdictions with respect to financing statements filed by Junior Creditor and naming an Obligor as debtor, or (viii) to take any action or inaction with respect to the Senior Debt.

(c) In the event that (i) Senior Lender releases or agrees to release any of its Liens in the Collateral, or (ii) any of the Collateral is sold or retained pursuant to a foreclosure or similar action, Junior Creditor shall be deemed to have to have consented to such release or sale, and Junior Creditor shall (or shall cause its agent to) promptly execute and deliver to Senior Lender such termination statements and releases as Senior Lender shall request to effect the termination or release of the Liens of Junior Creditor in such Collateral. In furtherance of the foregoing, Junior Creditor hereby irrevocably appoints Senior Lender its attorney-in-fact, with full authority in the place and stead of Junior Creditor and in the name of Junior Creditor or otherwise, for the limited purpose of executing and delivering any document or instrument which Junior Creditor may be required to deliver pursuant to this Section 2.4 to effect the termination or release of the Liens of Junior Creditor in such Collateral.

(d) In the event of any sale, transfer or other disposition (including a casualty loss or taking through eminent domain) of the Collateral, the proceeds resulting therefrom (including insurance proceeds) shall be applied in accordance with the terms of the Senior Debt Documents or as otherwise consented to by Senior Lender until such time as the Senior Debt is Paid in Full.

2.5 Enforcement by Junior Creditor. Notwithstanding any rights or remedies available to Junior Creditor under any of the Junior Debt Documents, applicable law or otherwise, prior to the Senior Loan Termination Date, Junior Creditor, in its capacity as such, shall not, directly or indirectly, take or seek to take any action against or assert any claims or interests in any Collateral or against any Obligor or otherwise take any action which would interfere with or impair the rights of Senior Lender against the Collateral or any Obligor (including, without limitation, the right to (i) accelerate the Junior Debt, (ii) take any action to foreclose, repossess, marshal control or exercise any remedies with respect to any assets or property of any Obligor, (iii) contact, communicate with or notify any account debtor or obligor with respect to any account, chattel paper, instrument or general intangible of any Obligor, or (iv) take any other action which would interfere with or impair the rights of Senior Lender against any Obligor). In addition to and not in limitation of the foregoing, Junior Creditor shall not commence, or join with any other Person in commencing, any Insolvency Proceeding prior to the Senior Loan Termination Date. Concurrently with the giving thereof to any Obligor, Junior Creditor agrees to give Senior Lender a copy of any written notice of a Default or an Event of Default under the Junior Debt Documents, or written notice of demand for payment from any Obligor.

2.6 Actions Not Subject to Limitation. Nothing in this Subordination Agreement shall be construed to in any way limit or impair the right of Junior Creditor to: (a) file a claim or statement of interest with respect to the Junior Debt; (b) file any necessary responsive or defensive pleadings in opposition to any motion, claim, adversary proceeding or other pleading made by any person objecting to or otherwise seeking the disallowance of the claims of the Junior Creditor, in each case in accordance with the terms of this Subordination Agreement; and (c) exercise, in whole or in part, any conversion rights with respect to the Junior Debt.

2.7 Advances by Senior Lender. If Senior Lender should honor or fail to honor a request by any Loan Party for a loan, advance or other financial accommodation under the Senior Loan Documents, whether or not Senior Lender has knowledge that the honoring of such request or the failure to honor such request would result in an Event of Default, or act, condition or event which with notice or passage of time or both would constitute an Event of Default under the Junior Debt Documents, in no event shall Senior Lender have any liability to Junior Creditor as a result of such breach or failure to act, and without limiting the generality of the foregoing, Junior Creditor agrees that Senior Lender shall not have any liability, as a result of honoring or failing to honor such request, for tortious interference with contractual relations or for inducement by Senior Lender of any Loan Party to breach their contracts or otherwise.

2.8 Prior Payment of Senior Debt in Bankruptcy.

(a) The provisions of this Subordination Agreement shall continue in full force and effect notwithstanding the occurrence of an Insolvency Proceeding against Borrower or any other Obligor or any of its or their respective properties or assets.

(b) Upon the commencement and throughout the term of any Insolvency Proceeding, all Senior Debt shall be Paid in Full and satisfied in cash or other immediately available funds before any payment whatsoever shall be made on account of any Junior Debt. Any payments or distributions made after the commencement of an Insolvency Proceeding which would, but for the provisions hereof, be payable or deliverable in respect of the Junior Debt, shall be paid or delivered by the liquidating trustee or any other Person making such payment or distribution directly to Senior Lender until all amounts owing upon Senior Debt shall have been Paid in Full and all commitments under the Senior Loan Documents shall have been irrevocably terminated. If, notwithstanding the foregoing provisions in this Section 2.8(b), in any Insolvency Proceeding Junior Creditor receives a payment or distribution with respect to the Junior Debt, Junior Creditor (i) shall hold any such payment or distribution in trust for the Senior Lender in the same medium in which received, (ii) shall not commingle such payment or distribution with any of the assets or properties of Junior Creditor or any other Person, and (iii) will deliver such payment or distribution to the Senior Lender, in the form received, properly endorsed to permit collection, immediately after receipt thereof by Junior Creditor.

(c) To the extent that Junior Creditor has or acquires any rights under Section 363, Section 364 or Section 1126 of the Bankruptcy Code with respect to the Collateral, Junior Creditor hereby agrees not to assert or attempt to exercise such rights without the prior written consent of Senior Lender. In the event and during the continuation of any Insolvency Proceeding, Junior Creditor shall not object to or oppose any cash collateral order or plan proposed or approved by Senior Lender.

2.9 Bankruptcy Financing.

(a) If any Obligor shall become subject to a case under the Bankruptcy Code or any similar Bankruptcy Law and if as a debtor-in-possession, such Obligor moves for approval of financing to be provided in good faith by any Senior Lender (in such capacity, the “DIP Lender”) under Section 364 of the Bankruptcy Code or the use of cash collateral with the consent of the DIP Lender under Section 363 of the Bankruptcy Code or any similar Bankruptcy Law (“DIP Financing”), Junior Creditor shall not object directly or indirectly to any such DIP Financing or such use of cash collateral and Junior Creditor will not request adequate protection or any other relief in connection therewith. Junior Creditor hereby agrees that the Junior Liens shall be subordinated to any DIP Financing (and all obligations relating thereto) to the extent and upon the terms and conditions specified in this Agreement. Junior Creditor agrees that (i) it shall not, directly or indirectly, provide, offer to provide or support any DIP Financing, in each case unless Senior Lender otherwise has provided its express written consent and (ii) it will object to any use of cash collateral or DIP Financing sought by any Obligor or any affiliate of an Obligor if the Senior Lender also objects to such use of such cash collateral or DIP Financing.

2.10 Modifications to the Junior Debt Documents. Until the Senior Debt has been Paid in Full, and notwithstanding anything to the contrary contained in the Subordinated Debt Documents, Junior Creditor shall not, without the prior written consent of Senior Lender, agree to any amendment, modification, supplement or waiver to the Junior Debt Documents (in all cases other than amendments, modifications and waivers that could not reasonably be expected to be adverse to the interests of the Senior Lender, it being understood, without limitation, that any amendment, modification or waiver increasing the payment obligations of any Obligor or any guarantor of the Junior Debt (or altering the timing thereof) shall be deemed to be adverse to the interests of Senior Lender).

2.11 Waiver of Certain Rights by Junior Creditor.

(a) To the fullest extent permitted by applicable law, Junior Creditor hereby waives: (i) notice of acceptance hereof; (ii) notice of any loans or other financial accommodations made or extended under the Senior Loan Agreement, or the creation or existence of any Senior Debt; (iii) notice of the amount of the Senior Debt; (iv) notice of any adverse change in the financial condition of any Obligor or of any other fact that might increase Junior Creditor’s risk hereunder; (v) notice of presentment for payment, demand, protest, and notice thereof as to any instrument among the Senior Loan Documents; (vi) notice of any Default or Event of Default under the Senior Loan Documents or otherwise relating to the Senior Debt; (vii) all other notices (except if such notice is specifically required to be given to such Junior Creditor under this Subordination Agreement) and demands to which such Junior Creditor might otherwise be entitled.

(b) To the fullest extent permitted by applicable law, Junior Creditor waives the right by statute or otherwise to require Senior Lender to institute suit against any Obligor or to exhaust any rights and remedies which Senior Lender has or may have against any Obligor. Junior Creditor further waives any defense arising by reason of any disability or other defense (other than the defense that the Senior Loan Termination Date has occurred of any Obligor or by reason of the cessation from any cause whatsoever of the liability of such Obligor in respect thereof.

(c) To the fullest extent permitted by applicable law, Junior Creditor hereby waives: (i) any rights to assert against Senior Lender any defense (legal or equitable), set-off, counterclaim, or claim which such Junior Creditor may now or at any time hereafter have against any Obligor or any other party liable to Senior Lender, such other holder or Junior Creditor; (ii) any defense, set-off, counterclaim, or claim, of any kind or nature, arising directly or indirectly from the present or future lack of perfection, sufficiency, validity, or enforceability of any Senior Debt, any Junior Debt or any security for either; (iii) any defense arising by reason of any claim or defense based upon an election of remedies by Senior Lender; and (iv) the benefit of any statute of limitations affecting Junior Creditor’s obligations hereunder or the enforcement thereof, and any act which shall defer or delay the operation of any statute of limitations applicable to the Senior Debt shall similarly operate to defer or delay the operation of such statute of limitations applicable to Junior Creditor’s obligations hereunder.

(d) Until such time as the Senior Loan Termination Date shall have occurred: (i) Junior Creditor hereby waives and postpones any right of subrogation such Junior Creditor has or may have as against any Obligor with respect to any Senior Debt; (ii) in addition, Junior Creditor hereby waives and postpones any right to proceed against any Obligor, now or hereafter, for contribution, indemnity, reimbursement, or any other suretyship rights and claims (irrespective of whether direct or indirect, liquidated or contingent), with respect to any Senior Debt; and (iii) in addition, Junior Creditor also hereby waives and postpones any right to proceed or to seek recourse against or with respect to any property or asset of any Obligor.

(e) WITHOUT LIMITING THE GENERALITY OF ANY OTHER WAIVER OR OTHER PROVISION SET FORTH IN THIS AGREEMENT, JUNIOR CREDITOR WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ALL RIGHTS AND DEFENSES ARISING OUT OF AN ELECTION OF REMEDIES BY SENIOR LENDER, EVEN THOUGH THAT ELECTION OF REMEDIES HAS DESTROYED SUCH JUNIOR CREDITOR’S RIGHTS OF SUBROGATION AND REIMBURSEMENT AGAINST ANY OBLIGOR BY THE OPERATION OF ANY APPLICABLE LAW.

(f) Neither the Senior Lender nor any of its affiliates, directors, officers, employees, or agents shall be liable for failure to demand, collect, or realize upon any of the Collateral or any Proceeds or for any delay in doing so or shall be under any obligation to sell or otherwise dispose of any Collateral or Proceeds thereof or to take any other action whatsoever with regard to the Collateral or any part or Proceeds thereof. Senior Lender will be entitled to manage and supervise its loans and extensions of credit under the Senior Loan Documents as Senior Lender may, in its sole discretion, deem appropriate, and Senior Lender may manage its loans and extensions of credit without regard to any rights or interests that Junior Creditor may have in the Collateral or otherwise except as otherwise expressly set forth in this Subordination Agreement. Junior Creditor agrees that Senior Lender shall not incur any liability as a result of a sale, lease, license, application or other disposition of all or any portion of the Collateral or any part or Proceeds thereof. Senior Lender may, from time to time, enter into agreements and settlements with Obligors as it may determine in its sole discretion without impairing any of the subordinations, priorities, rights or obligations of the parties under this Subordination Agreement, including, without limitation, substituting Collateral, releasing any Lien and releasing any Obligor. Junior Creditor waives any and all rights it may have to require Senior Lender to marshal assets, to exercise rights or remedies in a particular manner, or to forbear from exercising such rights and remedies in any particular manner or order.

2.12 Instrument Legends. Junior Creditor agrees that the face of each of the Junior Debt Documents and any other instrument evidencing the Junior Debt or any portion thereof or any security therefor shall be inscribed with a legend conspicuously indicating that payment thereon, performance thereof or Liens granted thereunder are subordinated to the claims of Senior Lender pursuant to the terms of this Subordination Agreement, and copies thereof shall be delivered to Senior Lender. Any instrument evidencing any of the Junior Debt or any portion thereof which is hereafter executed will, on the date thereof, be inscribed with a similar legend, and copies thereof will be delivered to Senior Lender five (5) business days prior to the date of its execution.

3. MISCELLANEOUS.

3.1 Representations and Warranties.

(a) Junior Creditor represents and warrants to Senior Lender that:

(i) the execution, delivery and performance of this Subordination Agreement by it (A) are within its powers, (B) have been duly authorized by it, and (C) do not contravene any law, any provision of any of the Junior Debt Documents or any agreement to which it is a party or by which it is bound; and

(ii) this Subordination Agreement constitutes the legal, valid and binding obligations of Junior Creditor, enforceable against Junior Creditor in accordance with its terms and shall be binding on Junior Creditor, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally or by equitable principles.

(b) Senior Lender hereby represents and warrants to Junior Creditor that:

(i) the execution, delivery and performance of this Subordination Agreement by Senior Lender (A) are within the powers of Senior Lender, (B) have been duly authorized by Senior Lender, and (C) do not contravene any law, any provision of the Senior Loan Documents or any agreement to which Senior Lender is a party or by which it is bound; and

(ii) this Subordination Agreement constitutes the legal, valid and binding obligations of Senior Lender, enforceable against Senior Lender in accordance with its terms and shall be binding on Senior Lender, except as such enforceability may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting the enforcement of creditors’ rights generally or by equitable principles.

3.2 Amendments. Any waiver, permit, consent or approval by either of Senior Lender or Junior Creditor of or under any provision, condition or covenant to this Subordination Agreement must be in writing and shall be effective only to the extent it is set forth in writing and as to the specific facts or circumstances covered thereby. Any amendment of this Subordination Agreement must be in writing and signed by Senior Lender and Junior Creditor and acknowledged by Obligors to the extent such amendment affects the obligations of Obligors under this Subordination Agreement or the Consent and Acknowledgment to this Subordination Agreement.

3.3 Successors and Assigns.

(a) This Subordination Agreement shall be binding upon the Creditors and their respective successors and assigns and shall inure to the benefit of the Creditors and their respective successors, participants and assigns.

(b) In the case of an assignment or transfer, the assignee or transferee acquiring any interest in the Junior Debt or the Senior Debt, as the case may be, shall execute and deliver to the applicable Creditor a written acknowledgment of receipt of a copy of this Subordination Agreement and the written agreement by such person to be bound by the terms of this Subordination Agreement which acknowledgment and agreement may be included in the assignment instrument between the assignor and assignee. In addition, in the event of an assignment or transfer by Junior Creditor of less than all of the Junior Debt, the Junior Creditor shall agree with the assignee in the assignment instrument effecting such assignment to appoint Junior Creditor as an agent to act on their behalf under this Subordination Agreement for purposes of receiving payments and notices hereunder.

(c) Any Person that becomes a Junior Creditor after the date hereof shall execute and deliver to each Creditor a written acknowledgment of receipt of a copy of this Subordination Agreement and the written agreement by such person to be bound by the terms of this Subordination Agreement, in form and substance satisfactory to the Senior Lender.

3.4 Notices. Unless otherwise specifically provided herein, any notice delivered under this Subordination Agreement shall be in writing addressed to the respective party as set forth below and may be personally served, telecopied, emailed or sent by overnight courier service or certified or registered United States mail and shall be deemed to have been given (a) if delivered in person, when delivered; (b) if delivered by telecopy or email, on the date of transmission if transmitted on a Business Day before 5:00 p.m. (Hartford, Connecticut time) or, if not, on the next succeeding Business Day; (c) if delivered by overnight courier, one business day after delivery to such courier properly addressed; or (d) if by United States mail, four business days after deposit in the United States mail, postage prepaid and properly addressed as provided below:

Each of Senior Lender, Junior Creditor and the Obligors may change the address(es) to which all notices, requests and other communications are to be sent by giving written notice of such address change to the other parties hereto in conformity with this Section 3.4, but such change shall not be effective until notice of such change has been received by such other parties.

3.5 Counterparts. This Subordination Agreement may be executed in any number of counterparts, each of which shall be an original with the same force and effect as if the signatures thereto and hereto were upon the same instrument. Delivery of an executed counterpart of this Subordination Agreement by facsimile or other method of electronic transmission shall have the same force and effect as manual delivery of an original executed counterpart of this Subordination Agreement.

3.6 Governing Law; Consent to Jurisdiction and Venue;. THIS SUBORDINATION AGREEMENT HAS BEEN EXECUTED OR COMPLETED AND/OR IS TO BE PERFORMED IN CONNECTICUT, AND IT AND ALL TRANSACTIONS HEREUNDER OR PURSUANT HERETO SHALL BE GOVERNED AS TO INTERPRETATION, VALIDITY, EFFECT, RIGHTS, DUTIES AND REMEDIES OF THE PARTIES THEREUNDER AND IN ALL OTHER RESPECTS BY THE LAWS OF CONNECTICUT. Each Party hereto consents to the personal jurisdiction in any court of the State of Connecticut or in the District Court of the United States for the District of Connecticut in connection with any controversy related to this Agreement, waives any argument that venue in any such forum is not convenient.

3.7 WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES ANY RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM CONCERNING ANY RIGHTS UNDER THIS SUBORDINATION AGREEMENT, OR UNDER ANY AMENDMENT, WAIVER, CONSENT, INSTRUMENT, DOCUMENT OR OTHER AGREEMENT DELIVERED OR WHICH IN THE FUTURE MAY BE DELIVERED IN CONNECTION HEREWITH, AND AGREES THAT ANY SUCH ACTION, PROCEEDINGS OR COUNTERCLAIM SHALL BE TRIED BEFORE A COURT AND NOT BEFORE A JURY EACH PARTY HEREBY ACKNOWLEDGES THAT THIS PROVISION IS A MATERIAL INDUCEMENT FOR THE OTHER PARTIES TO ENTER INTO THIS SUBORDINATION AGREEMENT.

3.8 Complete Agreement. This written Subordination Agreement is intended by the parties as a final expression of their agreement and is intended as a complete statement of the terms and conditions of their agreement with respect to the subject matter hereof.

3.9 No Third Parties Benefited. This Subordination Agreement is solely for the benefit of the Creditors and their respective successors, participants and assigns, and no other person shall have any right, benefit, priority or interest under, or because of the existence of, this Subordination Agreement.

3.10 Disclosures; Non-Reliance. Each Creditor has the means to, and shall in the future remain, fully informed as to the financial condition and other affairs of the Obligors and no Creditor shall have any obligation or duty to disclose any such information to the other Creditors. Except as expressly set forth in this Subordination Agreement, the parties hereto have not otherwise made to each other nor do they hereby make to each other any warranties, express or implied, nor do they assume any liability to each other with respect to: (a) the enforceability, validity, value or collectability of any of the Junior Debt or the Senior Debt or any guarantee or security which may have been granted to any of them in connection therewith, (b) any Obligor’s title to or right to transfer any of the Collateral, or (c) any other matter except as expressly set forth in this Subordination Agreement.

3.11 Term. This Subordination Agreement is a continuing agreement and shall remain in full force and effect until the Senior Loan Termination Date (subject to the reinstatement provisions set forth in Section 1.21 hereof).

3.12 Agent for Perfection. Until such time as the Creditors shall have entered into a dual secured party deposit account control agreement with respect to the Control Collateral (a “Replacement DACA”), Senior Lender agrees to hold (or cause to be held) all Control Collateral in its control as non-fiduciary agent for Junior Creditor solely for the purpose of perfecting the security interest granted to each Creditor in such Control Collateral, subject to the terms and conditions of this Agreement. Senior Lender shall not have any obligation whatsoever to Junior Creditor to assure that the Control Collateral is genuine or owned by any Obligor or any other Person or to preserve their respective rights or benefits or those of any other Person. The duties or responsibilities of Senior Lender under this Section 3.12 are and shall be limited solely to holding or maintaining control of the Control Collateral as non-fiduciary agent for Junior Creditor for purposes of perfecting the Lien held by Junior Creditor. Senior Lender is not, and Senior Lender shall not be deemed to be, a fiduciary of any kind for Junior Creditor or any other Person. Senior Lender shall use commercially reasonable efforts to enter into a Replacement DACA on substantially the same terms as that certain Blocked Account Control Agreement dated as of January 13, 2020 by and among Borrower, Lender and JPMorgan Chase Bank, N.A. (the “DACA”) and otherwise acceptable to Lender, which Replacement DACA shall replace the DACA and provide for Senior Lender to act as control agent until the Senior Loan Termination Date or Senior Lender’s earlier termination of its Lien on the Control Collateral, at which time Junior Agent shall succeed as control agent. For avoidance of any doubt, this Section 3.12 shall terminate following the Senior Loan Termination Date.

[The remainder of this page is intentionally left blank.]

IN WITNESS WHEREOF, the parties have caused this Subordination Agreement to be duly executed as of the day and year first above written.

SUBORDINATION AGREEMENT - Signature Page

CONSENT AND ACKNOWLEDGMENT

Each of the undersigned hereby acknowledges and agrees to the terms and provisions of the foregoing Subordination Agreement. By its signature below, each of the undersigned agrees that it will, together with its successors and assigns, be bound by the provisions of this Consent and Acknowledgment.

Each of the undersigned acknowledges and agrees that: (i) it is not a party to the Subordination Agreement and does not and will not receive any right, benefit, priority or interest under or because of the existence of the foregoing Subordination Agreement; and (ii) it will execute and deliver such additional documents and take such additional action as may be necessary or desirable in the reasonable opinion of any Creditor to effectuate the provisions and purposes of the foregoing Subordination Agreement.

SUBORDINATION AGREEMENT - Consent and Acknowledgement

Exhibit 10.4

EXECUTION COPY

CONTINUING GUARANTY

April 8, 2020

1. GUARANTY; DEFINITIONS. In consideration of any credit or other financial accommodation heretofore, now or hereafter extended or made to BLONDER TONGUE LABORATORIES, INC., a Delaware corporation (together with its successors and permitted assigns, “Borrower”) by Livewire Ventures, LLC, MidAtlantic IRA, LLC FBO Steven L. Shea IRA, Carol M. Pallé and Robert J. Pallé, Anthony J. Bruno, Stephen K. Necessary, and such other Persons who may from time to time become a lender (collectively, the “Lenders”), and Robert J. Pallé, as agent for the Lenders (in such capacity, the “Agent”), and for other valuable consideration, the undersigned, being R. L. DRAKE HOLDINGS, LLC, a Delaware limited liability company, having an address of c/o Blonder Tongue Laboratories, Inc., One Jake Brown Road, Old Bridge, NJ 08857 (“Guarantor”), unconditionally jointly and severally guarantees and promises to pay to Agent and Lenders, or order, on demand in lawful money of the United States of America and in immediately available funds, any and all Indebtedness. The term “Indebtedness” is used in its most comprehensive sense and means any debts, obligations and liabilities of Borrower to Agent and Lenders, including, without limitation, the “Obligations” as defined in that certain Senior Subordinated Convertible Loan and Security Agreement, by and between the Borrower, Agent and Lenders, dated as of the date hereof (as amended or modified from time to time, the “Loan Agreement”; capitalized terms used herein but not otherwise defined shall have the meanings ascribed thereto in the Loan Agreement), whether incurred in the past, present or future, whether voluntary or involuntary, and however arising, and whether due or not due, absolute or contingent, liquidated or unliquidated, determined or undetermined, and including without limitation all obligations arising under any swap, derivative, foreign exchange, hedge, deposit, treasury management or similar transaction or arrangement however described or defined that Borrower may enter into at any time with Agent or Lenders, whether or not Borrower may be liable individually or jointly with others, or whether recovery upon such Indebtedness may subsequently become unenforceable. This Guaranty is a guaranty of payment and not collection.

2. SUCCESSIVE TRANSACTIONS; REVOCATION; OBLIGATION UNDER OTHER GUARANTIES. This is a continuing guaranty and all rights, powers and remedies hereunder shall apply to all past, present and future Indebtedness, including that arising under successive transactions which shall either continue the Indebtedness, increase or decrease it, or from time to time create new Indebtedness after all or any prior Indebtedness has been satisfied, and notwithstanding the death, incapacity, dissolution, liquidation or bankruptcy of Borrower or Guarantor or any other event or proceeding affecting either Borrower or Guarantor. This Guaranty shall not apply to any new Indebtedness created after actual receipt by Agent, on behalf of Lenders, of written notice of Guarantor’s revocation as to such new Indebtedness; provided however, that loans or advances made by Lenders to Borrower after revocation under commitments existing prior to receipt by Agent, on behalf of Lenders, of such revocation, and extensions, renewals or modifications, of any kind, of Indebtedness incurred by Borrower or committed by Lenders prior to receipt by Agent, on behalf of Lenders, of such notice of revocation, shall not be considered new Indebtedness. Any such notice must be sent to Robert J. Pallé, as Agent, c/o Blonder Tongue Laboratories, Inc., One Jake Brown Road, Old Bridge, New Jersey 08857, Telecopy No: 732 679 3259, or at such other address as Agent shall from time to time designate. Any payment by Guarantor shall not reduce Guarantor’s maximum obligation hereunder unless written notice to that effect is actually received by Lenders at or prior to the time of such payment. The obligations of Guarantor under this Guaranty shall be in addition to any obligations of Guarantor under any other guaranties of any liabilities or obligations of Borrower or other persons that may be given to Agent and Lenders at any time, unless the other guaranties are expressly modified or revoked in writing; and this Guaranty shall not, unless expressly provided for in this Guaranty, affect or invalidate any such other guaranties.

3. SEPARATE ACTIONS; WAIVER OF STATUTE OF LIMITATIONS; REINSTATEMENT OF LIABILITY. Guarantor acknowledges that this Guaranty is absolute and unconditional, that there are no conditions precedent to the effectiveness of this Guaranty, and that this Guaranty is in full force and effect and binding on Guarantor as of the date written below, regardless of whether Agent or Lenders obtain collateral or any guaranties from others or takes any other action contemplated by Guarantor. Guarantor waives the benefit of any statute of limitations affecting the enforcement or Guarantor’s liability under this Guaranty, and Guarantor agrees that any payment of any Indebtedness or other act which shall toll any applicable statute of limitations shall similarly toll the statute of limitations applicable to Guarantor’s liability under this Guaranty. The liability of Guarantor hereunder shall be reinstated and revived and the rights of Agent and Lenders shall continue if and to the extent for any reason any amount at any time paid on account of any Indebtedness guaranteed hereby is rescinded or must otherwise be restored by Agent or Lenders, whether as a result of any proceedings in bankruptcy or reorganization or otherwise, all as though such amount had not been paid. The determination as to whether any amount so paid must be rescinded or restored shall be made by Agent, on behalf of Lenders, in its sole discretion; provided however, that if Agent chooses to contest any such matter at the request of Guarantor, Guarantor agrees to indemnify and hold Agent, on behalf of Lenders, harmless from and against all costs and expenses, including reasonable attorneys’ fees, expended or incurred by Agent or Lenders in connection therewith, including without limitation, in any litigation with respect thereto.

4. AUTHORIZATIONS TO AGENT. Guarantor authorizes Agent, on behalf of Lenders, either before or after revocation hereof, without notice to or demand on Guarantor, and without affecting Guarantor’s liability hereunder, from time to time to: (a) alter, compromise, renew, extend, accelerate or otherwise change the time for payment of, or otherwise change the terms of the Indebtedness or any portion thereof, including increase or decrease of the rate of interest thereon; (b) take and hold security for the payment of this Guaranty or the Indebtedness or any portion thereof, and exchange, enforce, waive, subordinate or release any such security; (c) apply such security and direct the order or manner of sale thereof, including without limitation, a non-judicial sale permitted by the terms of the controlling security agreement, mortgage or deed of trust, as Agent, on behalf of Lenders, in its discretion may determine; (d) release or substitute any one or more of the endorsers or any other guarantors of the Indebtedness, or any portion thereof, or any other party thereto; and (e) apply payments received by Agent, on behalf of Lenders, from Borrower to any portion of the Indebtedness, in such order as Agent shall determine in its sole discretion, whether or not such Indebtedness is covered by this Guaranty, and Guarantor hereby waives any provision of law regarding application of payments which specifies otherwise. Agent may without notice assign this Guaranty in whole or in part. Until Guarantor is other than a disregarded entity not engaged in any material business, upon Agent’s request, Guarantor agrees to provide to Agent copies of Guarantor’s financial statements.

5. REPRESENTATIONS AND WARRANTIES. Guarantor represents and warrants to Agent and Lenders that: (a) this Guaranty is executed at Borrower’s request; (b) Guarantor shall not, without Agent’s prior written consent, sell, lease, assign, encumber, hypothecate, transfer or otherwise dispose of all or a substantial or material part of Guarantor’s assets other than in the ordinary course of Guarantor’s business; (c) Agent has made no representation to Guarantor as to the creditworthiness of Borrower; and (d) Guarantor has established adequate means of obtaining from Borrower on a continuing basis financial and other information pertaining to Borrower’s financial condition. Guarantor agrees to keep adequately informed of any facts, events or circumstances which might in any way affect Guarantor’s liability under this Guaranty, and Guarantor further agrees that Agent and Lenders shall have no obligation to disclose to Guarantor any information or material about Borrower which is acquired by Agent or Lenders in any manner.

6. GUARANTOR’S COVENANTS. Guarantor covenants and agrees from the date hereof until payment and performance in full of all Indebtedness, and until the termination of the Loan Agreement, unless Agent, on behalf of Lenders, otherwise consents in writing, Guarantor shall deliver or cause to be delivered to Agent promptly upon Agent’s written request, such information about the financial condition and operations of Guarantor as Agent may, from time to time, reasonably request.

7. GUARANTOR’S WAIVERS.

(a) Guarantor waives any right to require Agent, on behalf of Lenders, to: (i) proceed against Borrower or any other person; (ii) marshal assets or proceed against or exhaust any security granted by Borrower or any other person; (iii) give notice of the terms, time and place of any public or private sale or other disposition of personal property security granted by Borrower or any other person; (iv) take any other action or pursue any other remedy in Agent’s power; or (v) make any presentment or demand for performance, or give any notice of nonperformance, protest, notice of protest or notice of dishonor hereunder or in connection with any obligations or evidences of indebtedness held by Agent, on behalf of Lenders, as security for or which constitute in whole or in part the Indebtedness guaranteed hereunder, or in connection with the creation of new or additional Indebtedness.

(b) Guarantor waives any defense to its obligations hereunder based upon or arising by reason of: (i) any disability or other defense of Borrower or any other person; (ii) the cessation or limitation from any cause whatsoever, other than payment in full, of the Indebtedness or the indebtedness of any other person; (iii) any lack of authority of any officer, director, partner, agent or any other person acting or purporting to act on behalf of Borrower, if it is a corporation, partnership or other type of entity, or any defect in the formation of Borrower; (iv) the application by Borrower of the proceeds of any Indebtedness for purposes other than the purposes represented by Borrower to, or intended or understood by, Agent or Guarantor; (v) any act or omission by Agent or Lenders which directly or indirectly results in or aids the discharge of Borrower or any portion of the Indebtedness by operation of law or otherwise, or which in any way impairs or suspends any rights or remedies of Agent and Lenders against Borrower; (vi) any impairment of the value of any interest in any security for the Indebtedness or any portion thereof, including without limitation, the failure to obtain or maintain perfection or recordation of any interest in any such security, the release of any such security without substitution, and/or the failure to preserve the value of, or to comply with applicable law in disposing of, any such security; (vii) any modification of the Indebtedness, in any form whatsoever, including any modification made after revocation hereof to any Indebtedness incurred prior to such revocation, and including without limitation the renewal, extension, acceleration or other change in time for payment of, or other change in the terms of, the Indebtedness or any portion thereof, including increase or decrease of the rate of interest thereon; or (viii) any requirement that Agent or Lenders give any notice of acceptance of this Guaranty. Until all Indebtedness has been paid in full, Guarantor shall have no right of subrogation, and Guarantor waives any right to enforce any remedy which Agent, on behalf of Lenders, now has or may hereafter have against Borrower or any other person, and waives any benefit of, or any right to participate in, any security now or hereafter held by Agent and Lenders. Guarantor further waives all rights and defenses Guarantor may have arising out of (A) any election of remedies by Agent, on behalf of Lenders, even though that election of remedies, such as a non-judicial foreclosure with respect to any security for any portion of the Indebtedness, destroys Guarantor’s rights of subrogation or Guarantor’s rights to proceed against Borrower for reimbursement, or (B) any loss of rights Guarantor may suffer by reason of any rights, powers or remedies of Borrower in connection with any anti-deficiency laws or any other laws limiting, qualifying or discharging Borrower’s Indebtedness, whether by operation of law or otherwise, including any rights Guarantor may have to a fair market value hearing to determine the size of a deficiency following any foreclosure sale or other disposition of any real property security for any portion of the Indebtedness.

8. AGENT’S AND LENDERS’ RIGHTS WITH RESPECT TO GUARANTOR’S PROPERTY IN ITS POSSESSION; WAIVER. In addition to all liens upon and rights of setoff against the monies, securities or other property of Guarantor given to Agent, on behalf of Lenders, by law, Guarantor hereby grants to Agent, on behalf of Lenders, a lien, security interest and right of setoff as security for all liabilities and Indebtedness to Agent and Lenders, whether now existing or hereafter arising, upon and against all deposits, credits, collateral and property, now or hereafter in the possession, custody, safekeeping or control of Agent and Lenders. At any time, without demand or notice, Agent, on behalf of Lenders, may set off the same or any part thereof and apply the same to any liability or Obligation of Guarantor even though unmatured and regardless of the adequacy of any other collateral securing the Indebtedness. No lien or right of setoff shall be deemed to have been waived by any act or conduct on the part of Agent, on behalf of Lenders, or by any neglect to exercise such right of setoff or to enforce such lien, or by any delay in so doing, and every right of setoff and lien shall continue in full force and effect until such right of setoff or lien is specifically waived or released by Agent, on behalf of Lenders, in writing. ANY AND ALL RIGHTS TO REQUIRE MIDCAP TO EXERCISE ITS RIGHTS OR REMEDIES WITH RESPECT TO ANY OTHER COLLATERAL OF WHICH SECURES THE INDEBTEDNESS, PRIOR TO EXERCISING ITS RIGHT OF SETOFF WITH RESPECT TO SUCH DEPOSITS, CREDITS OR OTHER PROPERTY OF GUARANTOR, ARE HEREBY KNOWINGLY, VOLUNTARILY AND IRREVOCABLY WAIVED.

9. SUBORDINATION. Any indebtedness of Borrower or any other Loan Party now or hereafter held by Guarantor is hereby subordinated to the Indebtedness. Such indebtedness of Borrower or any other Loan Party to Guarantor is assigned to Agent, on behalf of Lenders, as security for this Guaranty and the Indebtedness and, if Agent requests, shall be collected and received by Guarantor as trustee for Agent, on behalf of Lenders, and paid over to Agent, on behalf of Lenders, on account of the Indebtedness but without reducing or affecting in any manner the liability of Guarantor under the other provisions of this Guaranty. Any notes or other instruments now or hereafter evidencing such indebtedness of Borrower or any other Loan Party to Guarantor shall be marked with a legend that indicates that the notes or other instruments are subject to this Guaranty and, if Agent so requests, such notes and instruments shall be delivered to Agent. Agent, on behalf of Lenders, is hereby authorized in the name of Guarantor from time to time to file financing statements and continuation statements and execute such other documents and take such other action as Agent deems necessary or appropriate to perfect, preserve and enforce its rights hereunder.

10. REMEDIES; NO WAIVER. All rights, powers and remedies of Agent, on behalf of Lenders, hereunder are cumulative. No delay, failure or discontinuance of Agent in exercising any right, power or remedy hereunder shall affect or operate as a waiver of such right, power or remedy; nor shall any single or partial exercise of any such right, power or remedy preclude, waive or otherwise affect any other or further exercise thereof or the exercise of any other right, power or remedy. Any waiver, permit, consent or approval of any kind by Agent of any breach of this Guaranty, or any such waiver of any provisions or conditions hereof, must be in writing and shall be effective only to the extent set forth in writing.

11. COSTS, EXPENSES AND ATTORNEYS’ FEES. Guarantor shall pay to Agent, on behalf of Lenders, promptly upon demand the full amount of all payments, advances, charges, costs and expenses, including reasonable attorneys’ fees (to include outside counsel fees), expended or incurred by Agent, or Lenders in connection with the enforcement of any of Agent’s or Lenders’ rights, powers or remedies and/or the collection of any amounts which become due to Agent and Lenders under this Guaranty, and the prosecution or defense of any action in any way related to this Guaranty, whether incurred at the trial or appellate level, in an arbitration proceeding or otherwise, and including any of the foregoing incurred in connection with any bankruptcy proceeding (including without limitation, any adversary proceeding, contested matter or motion brought by Agent or Lenders or any other person) relating to Guarantor or any other person or entity.

12. SUCCESSORS; ASSIGNMENT. This Guaranty shall be binding upon and inure to the benefit of the successors and assigns of the parties; provided however, that Guarantor may not assign or transfer any of its interests or rights hereunder without Agent’s prior written consent and any prohibited assignment shall be absolutely void. Guarantor acknowledges that Agent, on behalf of Lenders, has the right to sell, assign, transfer, negotiate or grant participations in all or any part of, or any interest in, the Indebtedness and any obligations with respect thereto, including this Guaranty. In connection therewith, Agent may disclose all documents and information which Agent now has or hereafter acquires relating to Guarantor and/or this Guaranty, whether furnished by Borrower, Guarantor or otherwise. Guarantor further agrees that Agent may disclose such documents and information to Borrower.

13. AMENDMENT. This Guaranty may be amended or modified only in writing signed by Agent, on behalf of Lenders, and Guarantor.

14. APPLICATION OF SINGULAR AND PLURAL. In all cases where there is more than one Borrower named in this instrument, then the term “Borrower” shall be deemed to have been used in the plural where context and construction so require; and when this Guaranty is executed by more than one Guarantor, the word “Guarantor” shall mean all or any one or more of them as the context requires.

15. UNDERSTANDING WITH RESPECT TO WAIVERS; SEVERABILITY OF PROVISIONS. Guarantor warrants and agrees that each of the waivers set forth herein is made with Guarantor’s full knowledge of its significance and consequences, and that under the circumstances, the waivers are reasonable and not contrary to public policy or law. If any waiver or other provision of this Guaranty shall be held to be prohibited by or invalid under applicable public policy or law, such waiver or other provision shall be ineffective only to the extent of such prohibition or invalidity, without invalidating the remainder of such waiver or other provision or any remaining provisions of this Guaranty.

16. GOVERNING LAW AND CONSENT TO JURISDICTION. This Guaranty shall be governed by and construed in accordance with the laws of the State of Delaware. Guarantor agrees that any suit for the enforcement of this Guaranty may be brought in any state or federal court in the State of New Jersey and consents to the non-exclusive jurisdiction of such court and to service of process in any such suit being made upon Guarantor by mail at the address specified on the signature pager hereof. Guarantor hereby waives any objection that it may now or hereafter have to the venue of any such suit or any such court or that such suit was brought in an inconvenient court.

17. Waiver of Jury Trial. GUARANTOR IRREVOCABLY WAIVES ALL RIGHTS TO TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF, BASED ON OR PERTAINING TO THIS GUARANTY. 

IN WITNESS WHEREOF, the undersigned Guarantor has executed this Guaranty as of the date first written above.

Address:

One Jake Brown Road

Old Bridge, New Jersey 08857

6

Exhibit 10.5

Execution Copy

PATENT AND TRADEMARK SECURITY AGREEMENT

This Patent and Trademark Security Agreement (this “Agreement”), dated as of April 8, 2020, is made by and between BLONDER TONGUE LABORATORIES, INC., a Delaware corporation (together with its successors and permitted assigns, “Parent”), R. L. DRAKE HOLDINGS, LLC, a Delaware limited liability company (together with its permitted successors and assigns, “Drake”), and Robert J. Pallé, an individual, as agent for the Lenders (as defined in the Loan Agreement (as hereinafter defined)) (in such capacity, “Agent”; and together with the Lenders, collectively, the “Secured Party”). Each of Parent and Drake are individually and collectively referred to herein as “Debtor”.

Recitals

Parent, the Secured Party and certain other parties are parties to a Senior Subordinated Convertible Loan and Security Agreement, dated as of even date herewith (as the same may hereafter be amended, supplemented or restated from time to time, the “Loan Agreement”) setting forth the terms on which the Secured Party may now or hereafter extend credit to or for the account of Debtor.

As a condition to extending credit to or for the account of Debtor, the Secured Party has required the execution and delivery of this Agreement by Debtor.

ACCORDINGLY, in consideration of the mutual covenants contained in the Loan Documents and herein, the parties hereby agree as follows:

1. Definitions. All capitalized terms used herein and not otherwise defined shall have the meanings ascribed thereto in the Loan Agreement. In addition, the following terms have the meanings set forth below:

“Lien” means, with respect to any Collateral, any lien, encumbrance, adverse right or claim or deemed trust, or security interest of any kind.

“Obligations” means each and every debt, liability and obligation of every type and description arising under or in connection with any Loan Document (as defined in the Loan Agreement) which Debtor may now or at any time hereafter owe to the Secured Party, whether such debt, liability or obligation now exists or is hereafter created or incurred and whether it is or may be direct or indirect, due or to become due, absolute or contingent, primary or secondary, liquidated or unliquidated, independent, joint, several or joint and several, and including specifically, but not limited to, the Lender Indebtedness (as defined in the Loan Agreement).

“Patents” means all of Debtor’s right, title and interest in and to patents or applications for patents, fees or royalties with respect to each, and including without limitation the right to sue for past infringement and damages therefor, and licenses thereunder, all as presently existing or hereafter arising or acquired, including without limitation the patents listed on Exhibit A.

“Permitted Liens” means as applicable to the particular Collateral, (i) “Permitted Liens”, as defined in the MidCap Credit Agreement, and (ii) Liens in favor of MidCap.

“Security Interest” has the meaning given in Section 2.

“Trademarks” means all of Debtor’s right, title and interest in and to: (i) trademarks, service marks, collective membership marks, registrations and applications for registration for each, and the respective goodwill associated with each, (ii) licenses, fees or royalties with respect to each, (iii) the right to sue for past, present and future infringement, dilution and damages therefor, (iv) and licenses thereunder, all as presently existing or hereafter arising or acquired, including, without limitation, the marks listed on Exhibit B.

2. Security Interest. Debtor hereby irrevocably pledges and assigns to, and grants to Agent, on behalf of Lenders, a security interest (the “Security Interest”) with power of sale to the extent permitted by law, in the Patents and in the Trademarks to secure payment of the Obligations. As set forth in the Loan Agreement, the Security Interest is coupled with a security interest in substantially all of the personal property of Debtor. This Agreement grants only the Security Interest herein described, is not intended to and does not affect any present transfer of title of any trademark registration or application and makes no assignment and grants no right to assign or perform any other action with respect to any intent to use trademark application, unless such action is permitted under 15 U.S.C. § 1060.

3. Representations, Warranties and Agreements. Debtor represents, warrants and agrees as follows:

(a) Existence; Authority. Debtor is a limited liability company or corporation, as applicable, duly organized, validly existing and in good standing under the laws of its state of formation or incorporation, and this Agreement has been duly and validly authorized by all necessary organizational action on the part of Debtor.

(b) Patents. Exhibit A accurately lists all Patents owned or controlled by Debtor as of the date hereof, or to which Debtor has a right as of the date hereof to have assigned to it, and accurately reflects the existence and status of applications and letters patent pertaining to the Patents as of the date hereof. If after the date hereof, Debtor owns, controls or has a right to have assigned to it any Patents not listed on Exhibit A, or if Exhibit A ceases to accurately reflect the existence and status of applications and letters patent pertaining to the Patents, then Debtor shall within 60 days provide written notice to Agent, on behalf of Lenders, with a replacement Exhibit A, which upon acceptance by Agent shall become part of this Agreement.

(c) Trademarks. Exhibit B accurately lists all Trademarks owned or controlled by Debtor as of the date hereof and accurately reflects the existence and status of Trademarks and all applications and registrations pertaining thereto as of the date hereof; provided, however, that Exhibit B need not list common law marks (i.e., Trademarks for which there are no applications or registrations) which are not material to the business(es) of Debtor or any affiliate (as such term is defined in the Loan Agreement and hereinafter referred to as “Affiliate”). If after the date hereof, Debtor owns or controls any Trademarks not listed on Exhibit B (other than common law marks which are not material to Debtor’s or any Affiliate’s business(es)), or if Exhibit B ceases to accurately reflect the existence and status of applications and registrations pertaining to the Trademarks, then Debtor shall promptly provide written notice to Agent, on behalf of Lenders, with a replacement Exhibit B, which upon acceptance by Agent shall become part of this Agreement.

(d) Affiliates. As of the date hereof, no Affiliate owns, controls, or has a right to have assigned to it any items that would, if such item were owned by Debtor, constitute Patents or Trademarks. If after the date hereof any Affiliate owns, controls, or has a right to have assigned to it any such items, then Debtor shall promptly either: (i) cause such Affiliate to assign all of its rights in such item(s) to Debtor; or (ii) notify Agent, on behalf of Lenders, of such item(s) and cause such Affiliate to execute and deliver to Agent a patent and trademark security agreement substantially in the form of this Agreement.

(e) Title. Debtor has absolute title to each Patent and each Trademark listed on Exhibits A and B, free and clear of all Liens except Permitted Liens. Debtor (i) will have, at the time Debtor acquires any rights in Patents or Trademarks hereafter arising, absolute title to each such Patent or Trademark free and clear of all Liens except Permitted Liens, and (ii) will keep all Patents and Trademarks free and clear of all Liens except Permitted Liens.

(f) No Sale. Except as permitted in the Loan Agreement, Debtor will not assign, transfer, encumber or otherwise dispose of the Patents or Trademarks, or any interest therein, without Agent’s prior written consent.

(g) Defense. Debtor will, at its own expense and using commercially reasonable efforts, protect and defend the Patents and Trademarks against all claims or demands of all Persons other than those holding Permitted Liens.

(h) Maintenance. Debtor will at its own expense maintain the Patents and the Trademarks to the extent reasonably advisable in its business including, but not limited to, filing all applications to obtain letters patent or trademark registrations and all affidavits, maintenance fees, annuities, and renewals possible with respect to letters patent, trademark registrations and applications therefor. Debtor covenants that it will not abandon nor fail to pay any maintenance fee or annuity due and payable on any Patent or Trademark, nor fail to file any required affidavit or renewal in support thereof, without first providing Agent, on behalf of Lenders: (i) sufficient written notice, of at least 30 days, to allow Agent, on behalf of Lenders, to timely pay any such maintenance fees or annuities which may become due on any Patents or Trademarks, or to file any affidavit or renewal with respect thereto, and (ii) a separate written power of attorney or other authorization to pay such maintenance fees or annuities, or to file such affidavit or renewal, should such be necessary or desirable.

(i) Agent’s Right to Take Action. If Debtor fails to perform or observe any of its covenants or agreements set forth in this Section 3, and if such failure continues for a period of ten (10) calendar days after Agent gives Debtor written notice thereof (or, in the case of the agreements contained in subsection (h), immediately upon the occurrence of such failure, without notice or lapse of time), or if Debtor notifies Agent that it intends to abandon a Patent or Trademark, Agent may (but need not) perform or observe such covenant or agreement or take steps to prevent such intended abandonment on behalf and in the name, place and stead of Debtor (or, at Agent’s option, in Agent’s own name on behalf of Lenders) and may (but need not) take any and all other actions which Agent, on behalf of Lenders, may reasonably deem necessary to cure or correct such failure or prevent such intended abandonment.

(j) Costs and Expenses. Except to the extent that the effect of such payment would be to render any loan or forbearance of money usurious or otherwise illegal under any applicable law, Debtor shall pay Agent, for the benefit of Lenders, on demand the amount of all moneys expended and all costs and expenses (including reasonable attorneys’ fees and disbursements) incurred by the Secured Party in connection with or as a result of Agent’s taking action under subsection (i) or exercising its rights under Section 6, together with interest thereon from the date expended or incurred by the Secured Party at the Default Rate.

(k) Power of Attorney. To facilitate Agent’s taking action under subsection (i) and exercising its rights under Section 6, Debtor hereby irrevocably appoints (which appointment is coupled with an interest) Agent, on behalf of Lenders, or its delegate, as the attorney-in-fact of Debtor with the right (but not the duty) from time to time to create, prepare, complete, execute, deliver, endorse or file, in the name and on behalf of Debtor, any and all instruments, documents, applications, financing statements, and other agreements and writings required to be obtained, executed, delivered or endorsed by Debtor under this Section 3, or, necessary for Agent, on behalf of Lenders, after an Event of Default, to enforce or use the Patents or Trademarks or to grant or issue any exclusive or non-exclusive license under the Patents or Trademarks to any third party, or to sell, assign, transfer, pledge, encumber or otherwise transfer title in or dispose of the Patents or Trademarks to any third party. Debtor hereby ratifies all that such attorney shall lawfully do or cause to be done by virtue hereof. The power of attorney granted herein shall terminate upon the termination of the Loan Agreement as provided therein and the payment and performance of all Obligations.

4. Debtor’s Use of the Patents and Trademarks. Debtor shall be permitted to control and manage the Patents and Trademarks, including the right to exclude others from making, using or selling items covered by the Patents and Trademarks and any licenses thereunder, in the same manner and with the same effect as if this Agreement had not been entered into, so long as no Event of Default exists.

5. Events of Default. Each of the following occurrences shall constitute an event of default under this Agreement (herein called “Event of Default”): (a) an Event of Default, as defined in the Loan Agreement, shall exist; or (b) Debtor shall fail promptly to observe or perform any covenant or agreement herein binding on it; or (c) any of the representations or warranties contained in Section 3 shall prove to have been incorrect in any material respect when made.

6. Remedies. While an Event of Default exists, subject to the terms of Section 3(i) to the extent applicable, Agent, on behalf of Lenders, may, at its option, take any or all of the following actions:

(a) Agent may exercise any or all remedies available under the Loan Agreement.

(b) Agent may sell, assign, transfer, pledge, encumber or otherwise dispose of the Patents and Trademarks.

(c) Agent may enforce the Patents and Trademarks and any licenses thereunder, and if Agent shall commence any suit for such enforcement, Debtor shall, at the request of Agent, do any and all lawful acts and execute any and all proper documents required by Agent in aid of such enforcement.

7. Miscellaneous. This Agreement can be waived, modified, amended, terminated or discharged, and the Security Interest can be released, only explicitly in a writing signed by the Secured Party. A waiver signed by the Secured Party shall be effective only in the specific instance and for the specific purpose given. Mere delay or failure to act shall not preclude the exercise or enforcement of any of the Secured Party’s rights or remedies. All rights and remedies of Agent, on behalf of Lenders, shall be cumulative and may be exercised singularly or concurrently, at Agent’s option, and the exercise or enforcement of any one such right or remedy shall neither be a condition to nor bar the exercise or enforcement of any other. All notices to be given to Debtor under this Agreement shall be given in the manner and with the effect provided in the Loan Agreement. Agent shall not be obligated to preserve any rights Debtor may have against prior parties, to realize on the Patents and Trademarks at all or in any particular manner or order, or to apply any cash proceeds of Patents and Trademarks in any particular order of application. This Agreement shall be binding upon and inure to the benefit of Debtor and the Secured Party and their respective participants, successors and assigns and shall take effect when signed by Debtor and delivered to Agent, and Debtor waives notice of the Agent’s acceptance hereof. Agent may execute this Agreement if appropriate for the purpose of filing, but the failure of Agent to execute this Agreement shall not affect or impair the validity or effectiveness of this Agreement. This Agreement or any financing statement signed by Debtor may be transmitted by facsimile machine or by electronic mail in portable document format (“pdf”) and signatures appearing on faxed instruments and/or electronic mail instruments shall be treated as original signatures. Any party delivering an executed counterpart of this Agreement or any financing statement signed by Debtor by telefacsimile or other electronic method of transmission 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 or binding effect hereof. This Agreement shall be governed by the internal law of the State of Delaware without regard to conflicts of law provisions. The Debtor hereby consents to the exclusive jurisdiction of any state or federal court located within the State of New Jersey, and irrevocably agrees that subject to Agent’s election, all actions or proceedings relating to the Loan Documents or the transactions contemplated hereunder shall be litigated in such courts and Debtor waives any objection which it may have based on lack of personal jurisdiction, improper venue or forum non-conveniens to the conduct of any proceeding in any such court and waives personal service of any and all process upon them and consent that all such service of process be made by mail or messenger directed to it as the address set forth in the Loan Agreement. If any provision or application of this Agreement is held unlawful or unenforceable in any respect, such illegality or unenforceability shall not affect other provisions or applications which can be given effect and this Agreement shall be construed as if the unlawful or unenforceable provision or application had never been contained herein or prescribed hereby. All representations and warranties contained in this Agreement shall survive the execution, delivery and performance of this Agreement and the creation and payment of the Obligations.

[CONTINUED ON THE FOLLOWING PAGE]

THE PARTIES WAIVE ANY RIGHT TO TRIAL BY JURY IN ANY ACTION OR PROCEEDING BASED ON OR PERTAINING TO THIS AGREEMENT.

IN WITNESS WHEREOF, the parties have executed this Patent and Trademark Security Agreement as of the date written above.

 [Signature Page to Patent and Trademark Security Agreement]

 [Signature Page to Patent and Trademark Security Agreement]

EXHIBIT A

ISSUED PATENTS

None.

Miscellaneous shrink wrap software licenses

The Company also from time to time licenses technology from third parties that may not be subject to an underlying patent, but rather constitutes trade secret information of the licensor.

The following are the patent licenses which R. L. Drake Holdings, LLC (“Drake”) is a party:

ATSC Patent Portfolio License dated April 30, 2008 by and between MPEG LA, LLC (as licensor) and Drake (as licensee) and the ATSC non-assert document offered on behalf of Zenith Electronics dated April 13, 2010.

AVC Patent Portfolio License dated April 30, 2008 by and between MPEG LA, LLC (as licensor) and Drake (as licensee).

MPEG-2 Patent Portfolio License dated September 14, 2009 by and between MPEG LA, LLC (as licensor) and Drake (as licensee).

DFAST Technology License Agreement for Non-Portable (Cable Operator-Purchased) Devices) dated July 20, 2009 by and between Cable Television Laboratories, Inc. (as licensor) and Drake (as licensee).

Dolby Laboratories System License Agreement dated May 28, 2009 by and between Dolby Laboratories Licensing Corporation (as licensor) and Drake (as licensee).

EXHIBIT B

UNITED STATES ISSUED TRADEMARKS, SERVICE MARKS

AND COLLECTIVE MEMBERSHIP MARKS

REGISTRATIONS

None.

APPLICATIONS

None.

COLLECTIVE MEMBERSHIP MARKS

None.