No Payment on Notes. if Senior Indebtedness in Default. In addition to the restrictions set forth in Section 2.03 hereof, no payment on account of the principal of, or interest on, the Notes shall be made if, at the time of such payment or immediately after giving effect thereto, (a) there shall exist a default in the payment of principal, premium, if any, sinking funds, or interest with respect to any Senior Indebtedness, or (b) there shall have occurred any other event of default (of which the Company shall have received notice from any holder or trustee with respect to any Senior Indebtedness) relating to any Senior Indebtedness, as defined therein or in the instrument under which the same is outstanding, permitting the holders thereof to accelerate the maturity thereof, and such event of default shall not have been cured or waived or shall not have ceased to exist. In the event that the Notes are declared due and payable before their expressed maturity because of the occurrence of an Event of Default, the holders of Senior Indebtedness shall be entitled to receive payment in full of all principal (and premium, if any) and interest with respect to such indebtedness before the holders of the Notes shall be entitled to receive any payment on account of principal or otherwise.
Appears in 2 contracts
Sources: Subordinated Note Agreement (Family Bargain Corp), Junior Subordinated Note Agreement (Family Bargain Corp)