Application of Payments After Exercise of Rights Under Section 10 Sample Clauses
The "Application of Payments After Exercise of Rights Under Section 10" clause defines how any payments received are to be allocated following the enforcement of rights or remedies specified in Section 10, which typically relates to default or enforcement actions. In practice, this clause outlines the order in which outstanding amounts—such as principal, interest, fees, or costs—are to be paid from any funds recovered after a default event. For example, payments might first be applied to cover enforcement expenses, then accrued interest, and finally the principal balance. The core function of this clause is to ensure a clear and predetermined hierarchy for distributing recovered funds, thereby reducing disputes and providing certainty to all parties involved.
Application of Payments After Exercise of Rights Under Section 10. All payments made by or on behalf of the Obligors after the exercise of any rights arising under Section 10.2 shall be paid to and distributed pro rata among, as applicable, (i) the Lenders in accordance with their Rateable Portions, or (ii) as the case may be, to or among the Agent, the Lender or the Lenders to whom those payments are owing, in each instance in the following order:
Application of Payments After Exercise of Rights Under Section 10. 2
(a) firstly, in payment of agency fees and the reasonable costs and expenses of any realization against the Credit Parties or their property and assets, including the out-of-pocket expenses of the Administrative Agent and the reasonable fees and out-of-pocket expenses of counsel, consultants and other advisers employed in connection therewith and in payment of all costs and expenses incurred by the Administrative Agent in connection with the administration and enforcement of this Agreement or the other Documents, to the extent that those funds, costs and expenses shall not have been reimbursed to the Administrative Agent;
(b) secondly, in payment of any other unpaid fees payable hereunder by the Credit Parties;
(c) thirdly, in payment or prepayment of principal under any Swing Line Loans, then in payment or prepayment of other principal amounts owing hereunder, and then to the payment of any other Obligations (other than on account of interest or Hedging Liabilities) outstanding under this Agreement and under any other agreements applicable to outstanding Advances by the Borrower and then to the payment of accrued and unpaid interest in respect of Swing Line Loans hereunder and then to the payment of accrued and unpaid interest in respect of amounts other than Swing Line Loans;
(d) fourthly, in payment or prepayment of outstanding Hedging Liabilities owing to the Lenders on a pro-rata basis; and
(e) fifthly, in payment of the balance, if any, to the Borrower or such other person or persons who may be entitled at law or, in each case, their respective successors or assigns, or as a court of competent jurisdiction may otherwise direct.