Priority of Liens. (a) Notwithstanding anything else contained herein or in any other Security Document, it is the intent of the parties hereto that: (1) this Agreement and the Security Documents create four separate and distinct Trust Estates and Liens: the First Priority Trust Estate and Lien securing the payment and performance of the First Priority Lien Obligations, the Second Priority Trust Estate and Lien securing the payment and performance of the Second Priority Lien Obligations, the Third Priority Lien Trust Estate and Lien securing the payment and performance of the Third Priority Lien, and the Other Junior Lien Trust Estate and Lien securing the payment and performance of the Other Junior Lien Obligations; (2) (w) the Liens securing the First Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, (x) the Liens securing the Second Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations and the Liens securing the First Priority Lien Obligations, (y) the Liens securing the Third Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations and the Liens securing the Second Priority Lien Obligations and (z) the Liens securing the Other Junior Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations, the Liens securing the Second Priority Lien Obligations and the Liens securing the Third Priority Lien Obligations; and (3) subject to the provisions of this Agreement relating to the rights to proceeds of the sale of property subject to the Liens described herein and, if applicable, the Priming Liens, any sale of property pursuant to a Lien described hereunder or, if applicable, a Priming Lien, will extinguish all Liens junior to the Lien pursuant to which such sale was made, and any property so sold will be sold free and clear of all such junior Liens. (b) The parties hereto agree that, in no event will: (1) with respect to Collateral that is subject to a Lien in favor of any Priming Lien Secured Parties, the First Priority Debt Representatives or any First Priority Secured Parties have a Lien on or security interest in such Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties; (2) the Second Priority Debt Representatives or any Second Priority Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties and the First Priority Lien of the First Priority Secured Parties; (3) the Third Priority Debt Representatives or any Third Priority Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien of the First Priority Secured Parties and the Second Priority Lien of the Second Priority Secured Parties; or (4) the Other Junior Debt Representatives or any Other Junior Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien of the First Priority Secured Parties, the Second Priority Lien of the Second Priority Secured Parties and the Third Priority Lien of the Third Priority Secured Parties. (c) Whether or not any Insolvency Proceeding has been commenced by or against any Obligor: (1) the Junior Priority Secured Parties will not: (A) request judicial relief, in an Insolvency Proceeding or in any other court, that would hinder, delay, limit or prohibit the lawful exercise or enforcement of any right or remedy otherwise available to the Senior Priority Secured Parties in respect of the Collateral or that would limit, invalidate, avoid or set aside any Senior Priority Lien or subordinate any Senior Priority Liens to any Junior Priority Liens or grant Junior Priority Liens equal ranking to any Senior Priority Liens; (B) oppose or otherwise contest any motion for relief from the automatic stay or for any injunction against foreclosure or enforcement of Senior Priority Liens made by any Senior Priority Secured Parties in any Insolvency Proceedings; (C) oppose or otherwise contest any lawful exercise by any Senior Priority Secured Parties of the right to credit bid Senior Priority Lien Debt at any sale in foreclosure of Senior Priority Liens; or (D) oppose or otherwise contest any other request for judicial relief made in any court by any Senior Priority Secured Party relating to the lawful enforcement of any Senior Priority Lien against the Collateral; provided, however, that notwithstanding the foregoing, both before and during an Insolvency Proceeding, the Junior Priority Secured Parties may take any actions and exercise any and all rights that would otherwise be available to a holder of unsecured claims, including, without limitation, the commencement of Insolvency Proceedings against any Obligor in accordance with applicable law; provided further, however, that the Junior Priority Secured Parties may not challenge the validity, enforceability, perfection or priority of the Senior Priority Liens; and (2) prior to the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the First Priority Secured Parties will have the exclusive right to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Trust Estate, regardless of whether such Collateral may also be part of the Second Priority Trust Estate, the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the Second Priority Secured Parties may enforce rights, exercise remedies and take actions: (A) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations; (B) subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, to instruct the Collateral Agent to foreclose upon and otherwise enforce Second Priority Liens at any time after the Remedy Bar Lift Trigger Date; (C) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien; (D) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Second Priority Liens upon any Collateral; or (E) as necessary to create, prove, preserve or protect (but not enforce) the Second Priority Liens upon any Collateral. (3) after the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, and further subject to the Collateral Agent's obligations to comply with the Act of Required Debtholders, the First Priority Secured Parties and the Second Priority Secured Parties will have the exclusive right to instruct the Collateral Agent to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Trust Estate or the Second Priority Trust Estate, regardless of whether such Collateral may also be part of the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties: (A) the Third Priority Secured Parties may enforce rights, exercise remedies and take actions: (a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations; (b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien; (c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Third Priority Liens upon any Collateral; or (d) as necessary to create, prove, preserve or protect (but not enforce) the Third Priority Liens upon any Collateral. (B) the Other Junior Secured Parties may enforce rights, exercise remedies and take actions: (a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations, the Discharge of the Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations; (b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien; (c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Other Junior Liens upon any Collateral; or (d) as necessary to create, prove, preserve or protect (but not enforce) the Other Junior Liens upon any Collateral. (d) In exercising rights and remedies with respect to the Collateral, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the First Priority Secured Parties and, after the Remedy Bar Lift Trigger Date, but subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, the Second Priority Secured Parties, may enforce (or refrain from enforcing) the provisions of the Security Documents and exercise (or refrain from exercising) remedies thereunder or any such rights and remedies available at law or in equity, all in such order and in such manner as they may determine in the exercise of their sole and exclusive discretion, including: (1) the exercise or forbearance from exercise of all rights and remedies in respect of the Collateral and/or the applicable Liens; (2) the enforcement or forbearance from enforcement of any Lien in respect of the Collateral; (3) the exercise or forbearance from exercise of rights and powers of a holder of shares of stock included in the Collateral to the extent provided in the Security Documents; (4) the acceptance of the Collateral in full or partial satisfaction of the applicable Obligations; and (5) the exercise or forbearance from exercise of all rights and remedies of a secured lender under the UCC or any similar law of any applicable jurisdiction or in equity. (e) The parties hereto agree that: (1) Prior to the Discharge of First Priority Lien Obligations, the Second Priority Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties (in their capacity as priority lienholders), under equitable principles. (2) Prior to the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations, the Third Priority Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties or the Second Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles. (3) Prior to the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations, the Other Junior Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties, the Second Priority Secured Parties or the Third Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles. (f) Except for payments received free from the Senior Priority Liens as provided in Section 2.5(g), subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, (i) all proceeds of Collateral received by any Junior Priority Debt Representative, the Collateral Agent or any holder of Junior Priority Liens at any time prior to the Discharge of Senior Priority Lien Obligations, will be held by such Junior Priority Debt Representative, the Collateral Agent or such holder, as the case may be, for the account of the holders of Senior Priority Liens and remitted to the applicable Senior Priority Debt Representative in accordance with the terms of the Senior Priority Debt Documents. (g) Except for payments that are made from or constitute proceeds of property subject to Senior Priority Liens and that are received by any Junior Priority Debt Representative 44 or the Collateral Agent or any holder of Junior Priority Lien Obligations at any time prior to the Discharge of Senior Priority Lien Obligations and after (i) the commencement of any Insolvency Proceeding in respect of the Company or any other Obligor or (ii) any Junior Priority Debt Representative and the Collateral Agent have received written notice from any Senior Priority Debt Representative stating that (A) any Senior Priority Lien Debt has become due and payable in full (whether at maturity, upon acceleration or otherwise) or (B) the holders of Senior Priority Liens have become entitled to and desire to enforce any or all of the Priority Liens by reason of a default under any Senior Priority Debt Document: (1) no payment of money (or the equivalent of money) made by the Company or any other Obligor to any Junior Priority Debt Representative, the Collateral Agent or any other holder of Junior Priority Lien Obligations (including, without limitation, payments and prepayments made for application to Junior Priority Lien Obligations and all other payments and deposits made pursuant to any provision of the Junior Priority Debt Document) will in any event be the subject to the foregoing provisions of this Section 2.5; and (2) all payments permitted to be received under this Section 2.5(g) will be received by the applicable Junior Priority Debt Representative, the Collateral Agent and other holders of Junior Priority Lien Obligations free from the Senior Priority Liens and all other Liens except the Junior Priority Liens.
Appears in 1 contract
Sources: Collateral Trust and Intercreditor Agreement (Delta Energy Center, LLC)
Priority of Liens. (a) Notwithstanding anything else contained herein or in any other Security Collateral Document, it is the intent of the parties hereto Parties that:
(1i) this Agreement and the Security other Collateral Documents create four two separate and distinct Trust Estates and Liens: (A) the First Priority Senior Trust Estate and Lien securing the payment and performance of the First Priority Lien Obligations, Obligations and (B) the Second Priority Junior Trust Estate and Lien securing the payment and performance of the Second Priority Parity Lien Obligations, the Third Priority Lien Trust Estate and Lien securing the payment and performance of the Third Priority Lien, and the Other Junior Lien Trust Estate and Lien securing the payment and performance of the Other Junior Lien Obligations;; and
(2) (wii) the Liens securing the First Priority Parity Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, (x) the Liens securing the Second Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations and the Liens securing the First Priority Lien Obligations, (y) the Liens securing the Third Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations and the Liens securing the Second Priority Lien Obligations and (z) the Liens securing the Other Junior Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations, the Liens securing the Second Priority Lien Obligations and the Liens securing the Third Priority Lien Obligations; and
(3) subject to the provisions of this Agreement relating to the rights to proceeds of the sale of property subject to the Liens described herein and, if applicable, the Priming Liens, any sale of property pursuant to a Lien described hereunder or, if applicable, a Priming Lien, will extinguish all Liens junior to the Lien pursuant to which such sale was made, and any property so sold will be sold free and clear of all such junior Liens.
(b) The parties hereto Parties agree that, pursuant to the Indenture, the Borrower and each Secured Obligations Guarantor may grant Liens on portions of the Collateral that will be senior to the Liens securing the Secured Obligations. If the Borrower and each Secured Obligations Guarantor satisfies the conditions in the Indenture and any requirements of Priority Lien Debt for the granting of such Liens, certified to the Collateral Agent in an Officer’s Certificate, the Collateral Agent will execute such agreements, certificates, filings and other documents as are reasonably requested by the Borrower in order to recognize or establish the ranking of such Liens.
(c) The Parties agree that, after the date hereof and prior to the Discharge of Priority Lien Obligations, in no event will:
(1) with respect to Collateral that is subject to a Lien in favor of any Priming Lien Secured Parties, will the First Priority Parity Debt Representatives or any First Priority Parity Lien Secured Parties have a Lien on or security interest in such Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties;
(2) the Second Priority Debt Representatives or any Second Priority Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties and the First Priority senior Lien of the First Priority Secured Parties;
(3) the Third Priority Debt Representatives or any Third Priority Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien of the First Priority Secured Parties and the Second Priority Lien of the Second Priority Secured Parties; or
(4) the Other Junior Debt Representatives or any Other Junior Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien of the First Priority Secured Parties, the Second Priority Lien of the Second Priority Secured Parties and the Third Priority Lien of the Third Priority Secured Parties.
(cd) Whether or not any Both before and during an Insolvency Proceeding has been commenced by or against any ObligorProceeding, until the Discharge of Priority Lien Obligations:
(1i) the Junior Priority Parity Lien Secured Parties will not:
(A) request judicial relief, in an Insolvency Proceeding or in any other court, that would hinder, delay, limit or prohibit the lawful exercise or enforcement of any right or remedy otherwise available to the Senior Priority Lien Secured Parties in respect of the Collateral or that would limit, invalidate, avoid or set aside any Senior Priority Lien or subordinate any Senior the Priority Liens to any Junior Priority the Parity Liens or grant Junior Priority the Parity Liens equal ranking to any Senior the Priority Liens;
(B) oppose or otherwise contest any motion for relief from the automatic stay or for any injunction against foreclosure or enforcement of Senior Priority Liens made by any Senior Priority Lien Secured Parties Party in any Insolvency Proceedings;
(C) oppose or otherwise contest any lawful exercise by any Senior Priority Lien Secured Parties Party of the right to credit bid Senior Priority Lien Debt at any sale in foreclosure of Senior Priority Liens; or
(D) oppose or otherwise contest any other request for judicial relief made in any court by any Senior Priority Lien Secured Party relating to the lawful enforcement of any Senior Priority Lien against the CollateralLien; providedprovided that, however, that notwithstanding the foregoing, both before and during an Insolvency Proceeding, the Junior Priority Parity Lien Secured Parties may take any actions and exercise any and all rights that would otherwise be available to a holder of unsecured claims, including, without limitation, including the commencement of Insolvency Proceedings against the Borrower or any other Obligor in accordance with applicable law; provided further, howeverexcept, that the Junior Priority Parity Lien Secured Parties may not challenge the validity, enforceability, perfection or priority of the Senior Priority Liens; and
(2ii) prior to the Remedy Bar Lift Trigger Date, subject to the rights of any holders the holder of Permitted Prior Liens, including any Priming the Priority Lien Secured Parties, the First Priority Secured Parties will have the exclusive right to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Senior Trust Estate, regardless of whether such Collateral may also be part of the Second Priority Junior Trust EstateEstate (including, without limitation, the Third Priority Trust Estate exclusive right to authorize or direct the Other Junior Collateral Agent to enforce, collect or realize on any Collateral or exercise any other right or remedy with respect to the Collateral) and neither the Indenture Trustee nor the holders of Notes or other Parity Lien Trust EstateObligations may authorize or direct the Collateral Agent with respect to such matters. Notwithstanding the foregoing, the Parity Lien Secured Parties may, subject to the rights of any the holders of other Permitted Prior Liens, including any Priming Lien Secured Parties, the Second Priority Secured Parties may enforce rights, exercise remedies and take actions:
(A) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations;
(B) subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, to instruct the Collateral Agent to foreclose upon and otherwise enforce Second Priority Liens at any time after the Remedy Bar Lift Trigger Date;
(C) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations) any Collateral in a creditor's ’s redemption permitted by law or to deliver any notice or demand necessary to enforce (subject to the prior Discharge of Priority Lien Obligations) any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(DC) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Second Priority Parity Liens upon any Collateral, except through possession or control; or
(ED) as necessary to create, prove, preserve or protect (but not enforce) the Second Priority Parity Liens upon any Collateral.
(3) after the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, and further subject to the Collateral Agent's obligations to comply with the Act of Required Debtholders, the First Priority Secured Parties and the Second Priority Secured Parties will have the exclusive right to instruct the Collateral Agent to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Trust Estate or the Second Priority Trust Estate, regardless of whether such Collateral may also be part of the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties:
(A) the Third Priority Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Third Priority Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Third Priority Liens upon any Collateral.
(B) the Other Junior Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations, the Discharge of the Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Other Junior Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Other Junior Liens upon any Collateral.
(de) In exercising rights and remedies with respect to the Collateral, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the First Priority Secured Parties and, after the Remedy Bar Lift Trigger Date, but subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, the Second Priority Secured Parties, Debt Representatives may enforce (or refrain from enforcing) the provisions of the Security Priority Lien Documents and exercise (or refrain from exercising) remedies thereunder or any such rights and remedies available at law or in equityremedies, all in such order and in such manner as they may determine in the exercise of their sole and exclusive discretion, including:
(1i) the exercise or forbearance from exercise of all rights and remedies in respect of the Collateral and/or the applicable LiensPriority Lien Obligations;
(2ii) the enforcement or forbearance from enforcement of any Lien in respect of the Collateral;
(3iii) the exercise or forbearance from exercise of rights and powers of a holder of shares of stock included in the Collateral Senior Trust Estate to the extent provided in the Security Collateral Documents;
(4iv) the acceptance of the Collateral in full or partial satisfaction of the applicable Priority Lien Obligations; and
(5v) the exercise or forbearance from exercise of all rights and remedies of a secured lender under the UCC PPSA or any similar law of any applicable jurisdiction or in equity.
(ef) The parties hereto agree thatWithout in any way limiting the generality of the foregoing paragraphs, the Priority Lien Secured Parties may, at any time and from time to time, without the consent of or notice to the Parity Lien Secured Parties, without incurring responsibility to the Parity Lien Secured Parties and without impairing or releasing the subordination provided in this Agreement or the obligations hereunder of the Parity Lien Secured Parties, do any one or more of the following:
(1i) release any Person liable in any manner for the collection of the Priority Lien Obligations;
(ii) release the Lien on any Collateral securing the Priority Lien Obligations; and
(iii) exercise or refrain from exercising any rights against any Obligor.
(g) Prior to the Discharge of First Priority Lien Obligations, the Second Priority Parity Lien Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholderslienholder, as against the First Priority Lien Secured Parties (in their capacity as priority lienholdersholders of Priority Liens), under equitable principles.
(2) Prior to the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations, the Third Priority Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties or the Second Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles.
(3) Prior to the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations, the Other Junior Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties, the Second Priority Secured Parties or the Third Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles.
(f) Except for payments received free from the Senior Priority Liens as provided in Section 2.5(g), subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, (i) all proceeds of Collateral received by any Junior Priority Debt Representative, the Collateral Agent or any holder of Junior Priority Liens at any time prior to the Discharge of Senior Priority Lien Obligations, will be held by such Junior Priority Debt Representative, the Collateral Agent or such holder, as the case may be, for the account of the holders of Senior Priority Liens and remitted to the applicable Senior Priority Debt Representative in accordance with the terms of the Senior Priority Debt Documents.
(g) Except for payments that are made from or constitute proceeds of property subject to Senior Priority Liens and that are received by any Junior Priority Debt Representative 44 or the Collateral Agent or any holder of Junior Priority Lien Obligations at any time prior to the Discharge of Senior Priority Lien Obligations and after (i) the commencement of any Insolvency Proceeding in respect of the Company or any other Obligor or (ii) any Junior Priority Debt Representative and the Collateral Agent have received written notice from any Senior Priority Debt Representative stating that (A) any Senior Priority Lien Debt has become due and payable in full (whether at maturity, upon acceleration or otherwise) or (B) the holders of Senior Priority Liens have become entitled to and desire to enforce any or all of the Priority Liens by reason of a default under any Senior Priority Debt Document:
(1) no payment of money (or the equivalent of money) made by the Company or any other Obligor to any Junior Priority Debt Representative, the Collateral Agent or any other holder of Junior Priority Lien Obligations (including, without limitation, payments and prepayments made for application to Junior Priority Lien Obligations and all other payments and deposits made pursuant to any provision of the Junior Priority Debt Document) will in any event be the subject to the foregoing provisions of this Section 2.5; and
(2) all payments permitted to be received under this Section 2.5(g) will be received by the applicable Junior Priority Debt Representative, the Collateral Agent and other holders of Junior Priority Lien Obligations free from the Senior Priority Liens and all other Liens except the Junior Priority Liens.
Appears in 1 contract
Priority of Liens. (a) Notwithstanding anything else contained herein or in any other Security Document, it It is the intent of the parties hereto that:
(1i) this Agreement and the Security Documents create four three separate and distinct Trust Estates and Liens: the First Priority Trust Estate and Lien securing the payment and performance of the First Priority Lien Obligations, the Second Priority Trust Estate and Lien securing the payment and performance of the Second Priority Lien Obligations, the Third Priority Lien Trust Estate and Lien securing the payment and performance of the Third Priority Lien, Obligations and the Other Junior Lien Trust Estate and Lien securing the payment and performance of the Other Junior Lien Obligations;
(2ii) (w) the Liens securing the First Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, (x) the Liens securing the Second Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations Permitted Prior Liens and the Liens securing the First Priority Lien Obligations, and (y) the Liens securing the Third Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations and the Liens securing the Second Priority Lien Obligations and (z) the Liens securing the Other Junior Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Permitted Prior Liens securing and the First Priority Lien Obligations, the Liens securing the Second Priority Lien Obligations and the Liens securing the Third Second Priority Lien Obligations; and
(3iii) subject to the provisions of this Agreement relating to the rights to proceeds of the sale of property subject to the Liens described herein and, if applicable, the Priming Liensherein, any sale of property pursuant to a Lien described hereunder or, if applicable, a Priming Lien, permitted under the applicable Secured Debt Document or under Section 2.7(a)(iv) hereof will extinguish all Liens junior subordinate to the Lien pursuant to which such sale was made, and any property so sold will be sold free and clear of all such junior subordinate Liens.
(b) The parties hereto agree that, in no event will:
will (1) other than with respect to Collateral that is subject to a Lien in favor of any Priming Lien Secured Parties, the Escrowed Interest):
(i) The First Priority Debt Representatives Representative or any First Priority Secured Parties have a Lien on or security interest in such any Pledged Collateral that is not subject and subordinate to the Priming Second Priority Lien of any Priming Lien the Second Priority Secured Parties;
(2ii) the Second Priority Debt Representatives or any Second Priority Secured Parties have a Lien on or security interest in any Pledged Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties and the First Priority Lien of the First Priority Secured Parties;; and
(3iii) the Third Priority Other Junior Debt Representatives or any Third Priority Other Junior Secured Parties have a Lien on or security interest in any Pledged Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien of the First Priority Secured Parties and the Second Priority Lien of the Second Priority Secured Parties; or
(4) the Other Junior Debt Representatives or any Other Junior Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien of the First Priority Secured Parties, the Second Priority Lien of the Second Priority Secured Parties and the Third Priority Lien of the Third Priority Secured Parties.
(c) Whether or not any Insolvency Proceeding has been commenced by or against any Obligor:
(1) the Junior Priority Secured Parties will not:
(A) request judicial relief, in an Insolvency Proceeding or in any other court, that would hinder, delay, limit or prohibit the lawful exercise or enforcement of any right or remedy otherwise available to the Senior Priority Secured Parties in respect of the Collateral or that would limit, invalidate, avoid or set aside any Senior Priority Lien or subordinate any Senior Priority Liens to any Junior Priority Liens or grant Junior Priority Liens equal ranking to any Senior Priority Liens;
(B) oppose or otherwise contest any motion for relief from the automatic stay or for any injunction against foreclosure or enforcement of Senior Priority Liens made by any Senior Priority Secured Parties in any Insolvency Proceedings;
(C) oppose or otherwise contest any lawful exercise by any Senior Priority Secured Parties of the right to credit bid Senior Priority Lien Debt at any sale in foreclosure of Senior Priority Liens; or
(D) oppose or otherwise contest any other request for judicial relief made in any court by any Senior Priority Secured Party relating to the lawful enforcement of any Senior Priority Lien against the Collateral; provided, however, that notwithstanding the foregoing, both before and during an Insolvency Proceeding, the Junior Priority Secured Parties may take any actions and exercise any and all rights that would otherwise be available to a holder of unsecured claims, including, without limitation, the commencement of Insolvency Proceedings against any Obligor in accordance with applicable law; provided further, however, that the Junior Priority Secured Parties may not challenge the validity, enforceability, perfection or priority of the Senior Priority Liens; and
(2) prior to the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the First Priority Secured Parties will have the exclusive right to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Trust Estate, regardless of whether such Collateral may also be part of the Second Priority Trust Estate, the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the Second Priority Secured Parties may enforce rights, exercise remedies and take actions:
(A) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations;
(B) subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, to instruct the Collateral Agent to foreclose upon and otherwise enforce Second Priority Liens at any time after the Remedy Bar Lift Trigger Date;
(C) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(D) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Second Priority Liens upon any Collateral; or
(E) as necessary to create, prove, preserve or protect (but not enforce) the Second Priority Liens upon any Collateral.
(3) after the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, and further subject to the Collateral Agent's obligations to comply with the Act of Required Debtholders, the First Priority Secured Parties and the Second Priority Secured Parties will have the exclusive right to instruct the Collateral Agent to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Trust Estate or the Second Priority Trust Estate, regardless of whether such Collateral may also be part of the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties:
(A) the Third Priority Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Third Priority Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Third Priority Liens upon any Collateral.
(B) the Other Junior Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations, the Discharge of the Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Other Junior Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Other Junior Liens upon any Collateral.
(d) In exercising rights and remedies with respect to the Collateral, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the First Priority Secured Parties and, after the Remedy Bar Lift Trigger Date, but subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, the Second Priority Secured Parties, may enforce (or refrain from enforcing) the provisions of the Security Documents and exercise (or refrain from exercising) remedies thereunder or any such rights and remedies available at law or in equity, all in such order and in such manner as they may determine in the exercise of their sole and exclusive discretion, including:
(1) the exercise or forbearance from exercise of all rights and remedies in respect of the Collateral and/or the applicable Liens;
(2) the enforcement or forbearance from enforcement of any Lien in respect of the Collateral;
(3) the exercise or forbearance from exercise of rights and powers of a holder of shares of stock included in the Collateral to the extent provided in the Security Documents;
(4) the acceptance of the Collateral in full or partial satisfaction of the applicable Obligations; and
(5) the exercise or forbearance from exercise of all rights and remedies of a secured lender under the UCC or any similar law of any applicable jurisdiction or in equity.
(e) The parties hereto agree that:
(1) Prior to the Discharge of First Priority Lien Obligations, the Second Priority Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties (in their capacity as priority lienholders), under equitable principles.
(2) Prior to the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations, the Third Priority Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties or the Second Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles.
(3) Prior to the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations, the Other Junior Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties, the Second Priority Secured Parties or the Third Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles.
(f) Except for payments received free from the Senior Priority Liens as provided in Section 2.5(g), subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, (i) all proceeds of Collateral received by any Junior Priority Debt Representative, the Collateral Agent or any holder of Junior Priority Liens at any time prior to the Discharge of Senior Priority Lien Obligations, will be held by such Junior Priority Debt Representative, the Collateral Agent or such holder, as the case may be, for the account of the holders of Senior Priority Liens and remitted to the applicable Senior Priority Debt Representative in accordance with the terms of the Senior Priority Debt Documents.
(g) Except for payments that are made from or constitute proceeds of property subject to Senior Priority Liens and that are received by any Junior Priority Debt Representative 44 or the Collateral Agent or any holder of Junior Priority Lien Obligations at any time prior to the Discharge of Senior Priority Lien Obligations and after (i) the commencement of any Insolvency Proceeding in respect of the Company or any other Obligor or (ii) any Junior Priority Debt Representative and the Collateral Agent have received written notice from any Senior Priority Debt Representative stating that (A) any Senior Priority Lien Debt has become due and payable in full (whether at maturity, upon acceleration or otherwise) or (B) the holders of Senior Priority Liens have become entitled to and desire to enforce any or all of the Priority Liens by reason of a default under any Senior Priority Debt Document:
(1) no payment of money (or the equivalent of money) made by the Company or any other Obligor to any Junior Priority Debt Representative, the Collateral Agent or any other holder of Junior Priority Lien Obligations (including, without limitation, payments and prepayments made for application to Junior Priority Lien Obligations and all other payments and deposits made pursuant to any provision of the Junior Priority Debt Document) will in any event be the subject to the foregoing provisions of this Section 2.5; and
(2) all payments permitted to be received under this Section 2.5(g) will be received by the applicable Junior Priority Debt Representative, the Collateral Agent and other holders of Junior Priority Lien Obligations free from the Senior Priority Liens and all other Liens except the Junior Priority Liens.
Appears in 1 contract
Sources: Collateral Trust Agreement (ICO Global Communications (Holdings) LTD)
Priority of Liens. (a) Notwithstanding anything else contained herein or in any other Security Collateral Document, it is the intent of the parties hereto Parties that:
(1i) this Agreement and the Security other Collateral Documents create four two separate and distinct Trust Estates and Liens: (A) the First Priority Senior Trust Estate and Lien securing the payment and performance of the First Priority Lien Obligations, Obligations and (B) the Second Priority Junior Trust Estate and Lien securing the payment and performance of the Second Priority Parity Lien Obligations, the Third Priority Lien Trust Estate and Lien securing the payment and performance of the Third Priority Lien, and the Other Junior Lien Trust Estate and Lien securing the payment and performance of the Other Junior Lien Obligations;; and
(2) (wii) the Liens securing the First Priority Parity Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, (x) the Liens securing the Second Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations and the Liens securing the First Priority Lien Obligations, (y) the Liens securing the Third Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations and the Liens securing the Second Priority Lien Obligations and (z) the Liens securing the Other Junior Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations, the Liens securing the Second Priority Lien Obligations and the Liens securing the Third Priority Lien Obligations; and
(3) subject to the provisions of this Agreement relating to the rights to proceeds of the sale of property subject to the Liens described herein and, if applicable, the Priming Liens, any sale of property pursuant to a Lien described hereunder or, if applicable, a Priming Lien, will extinguish all Liens junior to the Lien pursuant to which such sale was made, and any property so sold will be sold free and clear of all such junior Liens.
(b) The parties hereto Parties agree that, pursuant to the Secured Debt Documents, the Obligors may grant Liens on portions of the Collateral that will be senior to the Liens securing the Secured Obligations. If the Obligor satisfies the conditions in the Secured Debt Document and any requirements of Priority Lien Debt for the granting of such Liens, certified to the Collateral Agent in an Officer’s Certificate, the Collateral Agent will execute such agreements, certificates, filings and other documents as are reasonably requested by such Obligor in order to recognize or establish the ranking of such Liens.
(c) The Parties agree that, after the date hereof and prior to the Discharge of Priority Lien Obligations, in no event will:
(1) with respect to Collateral that is subject to a Lien in favor of any Priming Lien Secured Parties, will the First Priority Parity Debt Representatives or any First Priority Parity Lien Secured Parties have a Lien on or security interest in such Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties;
(2) the Second Priority Debt Representatives or any Second Priority Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties and the First Priority senior Lien of the First Priority Secured Parties;
(3) the Third Priority Debt Representatives or any Third Priority Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien of the First Priority Secured Parties and the Second Priority Lien of the Second Priority Secured Parties; or
(4) the Other Junior Debt Representatives or any Other Junior Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien of the First Priority Secured Parties, the Second Priority Lien of the Second Priority Secured Parties and the Third Priority Lien of the Third Priority Secured Parties.
(cd) Whether or not any Both before and during an Insolvency Proceeding has been commenced by or against any ObligorProceeding, until the Discharge of Priority Lien Obligations:
(1i) the Junior Priority Parity Lien Secured Parties will not:
(A) request judicial relief, in an Insolvency Proceeding or in any other court, that would hinder, delay, limit or prohibit the lawful exercise or enforcement of any right or remedy otherwise available to the Senior Priority Lien Secured Parties in respect of the Collateral or that would limit, invalidate, avoid or set aside any Senior Priority Lien or subordinate any Senior the Priority Liens to any Junior Priority the Parity Liens or grant Junior Priority the Parity Liens equal ranking to any Senior the Priority Liens;
(B) oppose or otherwise contest any motion for relief from the automatic stay or for any injunction against foreclosure or enforcement of Senior Priority Liens made by any Senior Priority Lien Secured Parties Party in any Insolvency Proceedings;
(C) oppose or otherwise contest any lawful exercise by any Senior Priority Lien Secured Parties Party of the right to credit bid Senior Priority Lien Debt at any sale in foreclosure of Senior Priority Liens; or
(D) oppose or otherwise contest any other request for judicial relief made in any court by any Senior Priority Lien Secured Party relating to the lawful enforcement of any Senior Priority Lien against the CollateralLien; providedprovided that, however, that notwithstanding the foregoing, both before and during an Insolvency Proceeding, the Junior Priority Parity Lien Secured Parties may take any actions and exercise any and all rights that would otherwise be available to a holder of unsecured claims, including, without limitation, including the commencement of Insolvency Proceedings against the Company or any other Obligor in accordance with applicable law; provided further, howeverexcept, that the Junior Priority Parity Lien Secured Parties may not challenge the validity, enforceability, perfection or priority of the Senior Priority Liens; and
(2ii) prior to the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Priority Lien Secured Parties, the First Priority Secured Parties will have the exclusive right to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Senior Trust Estate, regardless of whether such Collateral may also be part of the Second Priority Junior Trust EstateEstate (including, without limitation, the Third Priority Trust Estate exclusive right to authorize or direct the Other Junior Collateral Agent to enforce, collect or realize on any Collateral or exercise any other right or remedy with respect to the Collateral) and neither the Indenture Trustees nor the holders of Notes or other Parity Lien Trust EstateObligations may authorize or direct the Collateral Agent with respect to such matters. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Parity Lien Secured PartiesParties may, the Second Priority Secured Parties may enforce rights, exercise remedies and take actions:
(A) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations;
(B) subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, to instruct the Collateral Agent to foreclose upon and otherwise enforce Second Priority Liens at any time after the Remedy Bar Lift Trigger Date;
(C) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations) any Collateral in a creditor's ’s redemption permitted by law or to deliver any notice or demand necessary to enforce (subject to the prior Discharge of Priority Lien Obligations) any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(DC) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Second Priority Parity Liens upon any Collateral, except through possession or control; or
(ED) as necessary to create, prove, preserve or protect (but not enforce) the Second Priority Parity Liens upon any Collateral.
(3) after the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, and further subject to the Collateral Agent's obligations to comply with the Act of Required Debtholders, the First Priority Secured Parties and the Second Priority Secured Parties will have the exclusive right to instruct the Collateral Agent to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Trust Estate or the Second Priority Trust Estate, regardless of whether such Collateral may also be part of the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties:
(A) the Third Priority Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Third Priority Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Third Priority Liens upon any Collateral.
(B) the Other Junior Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations, the Discharge of the Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Other Junior Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Other Junior Liens upon any Collateral.
(de) In exercising rights and remedies with respect to the Collateral, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the First Priority Secured Parties and, after the Remedy Bar Lift Trigger Date, but subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, the Second Priority Secured Parties, Debt Representatives may enforce (or refrain from enforcing) the provisions of the Security Priority Lien Documents and exercise (or refrain from exercising) remedies thereunder or any such rights and remedies available at law or in equityremedies, all in such order and in such manner as they may determine in the exercise of their sole and exclusive discretion, including:
(1i) the exercise or forbearance from exercise of all rights and remedies in respect of the Collateral and/or the applicable LiensPriority Lien Obligations;
(2ii) the enforcement or forbearance from enforcement of any Lien in respect of the Collateral;
(3iii) the exercise or forbearance from exercise of rights and powers of a holder of shares of stock included in the Collateral Senior Trust Estate to the extent provided in the Security Collateral Documents;
(4iv) the acceptance of the Collateral in full or partial satisfaction of the applicable Priority Lien Obligations; and
(5v) the exercise or forbearance from exercise of all rights and remedies of a secured lender under the UCC PPSA or any similar law of any applicable jurisdiction or in equity.
(ef) The parties hereto agree thatWithout in any way limiting the generality of the foregoing paragraphs, the Priority Lien Secured Parties may, at any time and from time to time, without the consent of or notice to the Parity Lien Secured Parties, without incurring responsibility to the Parity Lien Secured Parties and without impairing or releasing the subordination provided in this Agreement or the obligations hereunder of the Parity Lien Secured Parties, do any one or more of the following:
(1i) release any Person liable in any manner for the collection of the Priority Lien Obligations;
(ii) release the Lien on any Collateral securing the Priority Lien Obligations; and
(iii) exercise or refrain from exercising any rights against any Obligor.
(g) Prior to the Discharge of First Priority Lien Obligations, the Second Priority Parity Lien Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholderslienholder, as against the First Priority Lien Secured Parties (in their capacity as priority lienholdersholders of Priority Liens), under equitable principles.
(2) Prior to the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations, the Third Priority Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties or the Second Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles.
(3) Prior to the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations, the Other Junior Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties, the Second Priority Secured Parties or the Third Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles.
(f) Except for payments received free from the Senior Priority Liens as provided in Section 2.5(g), subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, (i) all proceeds of Collateral received by any Junior Priority Debt Representative, the Collateral Agent or any holder of Junior Priority Liens at any time prior to the Discharge of Senior Priority Lien Obligations, will be held by such Junior Priority Debt Representative, the Collateral Agent or such holder, as the case may be, for the account of the holders of Senior Priority Liens and remitted to the applicable Senior Priority Debt Representative in accordance with the terms of the Senior Priority Debt Documents.
(g) Except for payments that are made from or constitute proceeds of property subject to Senior Priority Liens and that are received by any Junior Priority Debt Representative 44 or the Collateral Agent or any holder of Junior Priority Lien Obligations at any time prior to the Discharge of Senior Priority Lien Obligations and after (i) the commencement of any Insolvency Proceeding in respect of the Company or any other Obligor or (ii) any Junior Priority Debt Representative and the Collateral Agent have received written notice from any Senior Priority Debt Representative stating that (A) any Senior Priority Lien Debt has become due and payable in full (whether at maturity, upon acceleration or otherwise) or (B) the holders of Senior Priority Liens have become entitled to and desire to enforce any or all of the Priority Liens by reason of a default under any Senior Priority Debt Document:
(1) no payment of money (or the equivalent of money) made by the Company or any other Obligor to any Junior Priority Debt Representative, the Collateral Agent or any other holder of Junior Priority Lien Obligations (including, without limitation, payments and prepayments made for application to Junior Priority Lien Obligations and all other payments and deposits made pursuant to any provision of the Junior Priority Debt Document) will in any event be the subject to the foregoing provisions of this Section 2.5; and
(2) all payments permitted to be received under this Section 2.5(g) will be received by the applicable Junior Priority Debt Representative, the Collateral Agent and other holders of Junior Priority Lien Obligations free from the Senior Priority Liens and all other Liens except the Junior Priority Liens.
Appears in 1 contract
Priority of Liens. The Bank, the Trust and Charter agree that at all times, whether before, after or during the pendency of any bankruptcy, reorganization or other insolvency proceeding involving Borrower, and notwithstanding the priorities which would ordinarily result from the order or the granting of any Lien, or the order of filing of any financing statements or mortgages, the priorities of the Liens in favor of the Bank, the Trust and Charter shall be as follows:
(a) Notwithstanding anything else contained herein or in any other Security Document, it is the intent The Lien of the parties hereto that:
(1) this Agreement Bank with respect to the Bank Senior Collateral arising pursuant to the Bank Agreements shall constitute, vis-a-vis Charter and the Security Documents create four separate and distinct Trust Estates and Liens: the First Priority Trust Estate and Lien securing the payment and performance of the First Priority Lien Obligations, the Second Priority Trust Estate and Lien securing the payment and performance of the Second Priority Lien Obligations, the Third Priority Lien Trust Estate and Lien securing the payment and performance of the Third Priority Lien, and the Other Junior Lien Trust Estate and Lien securing the payment and performance of the Other Junior Lien Obligations;
(2) (w) the Liens securing the First Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, (x) the Liens securing the Second Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations and the Liens securing the First Priority Lien Obligations, (y) the Liens securing the Third Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations and the Liens securing the Second Priority Lien Obligations and (z) the Liens securing the Other Junior Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations, the Liens securing the Second Priority Lien Obligations and the Liens securing the Third Priority Lien Obligations; and
(3) subject to the provisions of this Agreement relating to the rights to proceeds of the sale of property subject to the Liens described herein and, if applicable, the Priming Liens, any sale of property pursuant to a Lien described hereunder or, if applicableTrust, a Priming Lien, will extinguish all Liens junior to first priority Lien on the Lien pursuant to which such sale was made, and any property so sold will be sold free and clear of all such junior LiensBank Senior Collateral as security for the Bank Debt.
(b) The parties hereto agree that, in no event will:
(1) Lien of Charter with respect to the Bank Senior Collateral that is subject and arising pursuant to the Charter Agreements shall constitute, vis-a-vis the Bank and the Trust, a Lien in favor of any Priming Lien Secured Parties, the First Priority Debt Representatives or any First Priority Secured Parties have a second priority Lien on or the Bank Senior Collateral as security interest in such Collateral that is not subject and subordinate to for the Priming Lien of any Priming Lien Secured Parties;
(2) the Second Priority Debt Representatives or any Second Priority Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties and the First Priority Lien of the First Priority Secured Parties;
(3) the Third Priority Debt Representatives or any Third Priority Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien of the First Priority Secured Parties and the Second Priority Lien of the Second Priority Secured Parties; or
(4) the Other Junior Debt Representatives or any Other Junior Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien of the First Priority Secured Parties, the Second Priority Lien of the Second Priority Secured Parties and the Third Priority Lien of the Third Priority Secured PartiesCharter Debt.
(c) Whether or not any Insolvency Proceeding has been commenced by or against any Obligor:
(1) the Junior Priority Secured Parties will not:
(A) request judicial relief, in an Insolvency Proceeding or in any other court, that would hinder, delay, limit or prohibit the lawful exercise or enforcement of any right or remedy otherwise available to the Senior Priority Secured Parties in respect The Lien of the Collateral or that would limit, invalidate, avoid or set aside any Senior Priority Lien or subordinate any Senior Priority Liens to any Junior Priority Liens or grant Junior Priority Liens equal ranking to any Senior Priority Liens;
(B) oppose or otherwise contest any motion for relief from the automatic stay or for any injunction against foreclosure or enforcement of Senior Priority Liens made by any Senior Priority Secured Parties in any Insolvency Proceedings;
(C) oppose or otherwise contest any lawful exercise by any Senior Priority Secured Parties of the right to credit bid Senior Priority Lien Debt at any sale in foreclosure of Senior Priority Liens; or
(D) oppose or otherwise contest any other request for judicial relief made in any court by any Senior Priority Secured Party relating to the lawful enforcement of any Senior Priority Lien against the Collateral; provided, however, that notwithstanding the foregoing, both before and during an Insolvency Proceeding, the Junior Priority Secured Parties may take any actions and exercise any and all rights that would otherwise be available to a holder of unsecured claims, including, without limitation, the commencement of Insolvency Proceedings against any Obligor in accordance with applicable law; provided further, however, that the Junior Priority Secured Parties may not challenge the validity, enforceability, perfection or priority of the Senior Priority Liens; and
(2) prior to the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the First Priority Secured Parties will have the exclusive right to enforce rights and exercise remedies Trust with respect to any the Bank Senior Collateral that is part of the First Priority Trust Estate, regardless of whether such Collateral may also be part of the Second Priority Trust Estate, the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject and arising pursuant to the rights of any holders of Permitted Prior LiensTrust Agreements shall constitute, including any Priming Lien Secured Parties, the Second Priority Secured Parties may enforce rights, exercise remedies and take actions:
(A) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations;
(B) subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, to instruct the Collateral Agent to foreclose upon and otherwise enforce Second Priority Liens at any time after the Remedy Bar Lift Trigger Date;
(C) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(D) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Second Priority Liens upon any Collateral; or
(E) as necessary to create, prove, preserve or protect (but not enforce) the Second Priority Liens upon any Collateral.
(3) after the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, and further subject to the Collateral Agent's obligations to comply with the Act of Required Debtholders, the First Priority Secured Parties vis-a-vis Charter and the Second Priority Secured Parties will have Bank, a third priority Lien on the exclusive right to instruct Bank Senior Collateral as security for the Collateral Agent to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Trust Estate or the Second Priority Trust Estate, regardless of whether such Collateral may also be part of the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties:
(A) the Third Priority Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Third Priority Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Third Priority Liens upon any Collateral.
(B) the Other Junior Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations, the Discharge of the Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Other Junior Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Other Junior Liens upon any CollateralDebt.
(d) In exercising rights and remedies The Lien of Charter with respect to the Collateral, subject Charter Senior Collateral arising pursuant to the rights of any holders of Permitted Prior LiensCharter Agreements shall constitute, including any Priming vis-a-vis the Bank and the Trust, a first priority Lien Secured Parties, on the First Priority Secured Parties and, after Charter Senior Collateral as security for the Remedy Bar Lift Trigger Date, but subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, the Second Priority Secured Parties, may enforce (or refrain from enforcing) the provisions of the Security Documents and exercise (or refrain from exercising) remedies thereunder or any such rights and remedies available at law or in equity, all in such order and in such manner as they may determine in the exercise of their sole and exclusive discretion, including:
(1) the exercise or forbearance from exercise of all rights and remedies in respect of the Collateral and/or the applicable Liens;
(2) the enforcement or forbearance from enforcement of any Lien in respect of the Collateral;
(3) the exercise or forbearance from exercise of rights and powers of a holder of shares of stock included in the Collateral to the extent provided in the Security Documents;
(4) the acceptance of the Collateral in full or partial satisfaction of the applicable Obligations; and
(5) the exercise or forbearance from exercise of all rights and remedies of a secured lender under the UCC or any similar law of any applicable jurisdiction or in equityCharter Debt.
(e) The parties hereto agree that:
(1) Prior Lien of the Bank with respect to the Discharge of First Priority Lien ObligationsCharter Senior Collateral arising pursuant to the Bank Agreements shall constitute, the Second Priority Secured Parties vis-a-vis Charter and the Trust, a second priority Lien on the Charter Senior Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against security for the First Priority Secured Parties (in their capacity as priority lienholders), under equitable principles.
(2) Prior to the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations, the Third Priority Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties or the Second Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles.
(3) Prior to the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations, the Other Junior Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties, the Second Priority Secured Parties or the Third Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principlesBank Debt.
(f) Except for payments received free from The Lien of the Senior Priority Liens as provided in Section 2.5(g), subject Trust with respect to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, (i) all proceeds of Charter Senior Collateral received by any Junior Priority Debt Representative, the Collateral Agent or any holder of Junior Priority Liens at any time prior arising pursuant to the Discharge of Trust Agreements shall constitute, vis-a-vis Charter and the Bank, a third priority Lien on the Charter Senior Priority Lien Obligations, will be held by such Junior Priority Debt Representative, the Collateral Agent or such holder, as the case may be, security for the account of the holders of Senior Priority Liens and remitted to the applicable Senior Priority Debt Representative in accordance with the terms of the Senior Priority Debt DocumentsTrust Debt.
(g) Except for payments that are made from or constitute proceeds as otherwise provided herein, the priority of property subject to Senior Priority the Liens of the Bank, the Trust, and that are received by any Junior Priority Debt Representative 44 or Charter in the Collateral Agent or any holder of Junior Priority Lien Obligations at any time prior to shall be in accordance with the Discharge of Senior Priority Lien Obligations and after (i) the commencement of any Insolvency Proceeding in respect of the Company or any other Obligor or (ii) any Junior Priority Debt Representative and the Collateral Agent have received written notice from any Senior Priority Debt Representative stating that (A) any Senior Priority Lien Debt has become due and payable in full (whether at maturity, upon acceleration or otherwise) or (B) the holders of Senior Priority Liens have become entitled to and desire to enforce any or all of the Priority Liens by reason of a default under any Senior Priority Debt Document:
(1) no payment of money (or the equivalent of money) made by the Company or any other Obligor to any Junior Priority Debt Representative, the Collateral Agent or any other holder of Junior Priority Lien Obligations (including, without limitation, payments and prepayments made for application to Junior Priority Lien Obligations and all other payments and deposits made pursuant to any provision of the Junior Priority Debt Document) will in any event be the subject to the foregoing provisions of this Section 2.5; and
(2) all payments permitted to be received under this Section 2.5(g) will be received by the applicable Junior Priority Debt Representative, the Collateral Agent and other holders of Junior Priority Lien Obligations free from the Senior Priority Liens and all other Liens except the Junior Priority LiensUniform Commercial Code.
Appears in 1 contract
Priority of Liens. Agent has a valid, enforceable, perfected, first ----------------- priority Lien and security interest for the benefit of Lenders in (ai) Notwithstanding anything else contained herein each Mortgage Loan heretofore identified on a Collateral Pledge Certificate delivered to Agent and not subsequently released by Agent pursuant to the Original Loan Agreement or in any the Existing Loan Agreement, or this agreement, (ii) the Agency Servicing Rights of Borrower and the Servicing Rights of Borrower other than Agency Servicing Rights heretofore granted by Borrower to Agent pursuant to the Security DocumentAgreement and not subsequently released by Agent pursuant to the Original Loan Agreement, it is or the intent Existing Loan Agreement, or this agreement, and (iii) each Take-Out Commitment of Borrower. Upon delivery to Agent of a Collateral Pledge Certificate identifying a New Wet Mortgage Loan and the funding by Lenders of the parties hereto that:
Warehouse Advances (1or by Agent of the Swing Advance) this Agreement requested in connection therewith, Agent will have valid, enforceable, perfected, first priority Liens and security interests for the benefit of Lenders in such New Wet Mortgage Loan and in all Mortgage Documents related thereto. Upon delivery to Agent of each Collateral Pledge Certificate and the Security Mortgage Notes which evidence the Mortgage Loans (other than New Wet Mortgage Loans) identified therein, Agent will have valid, enforceable, perfected, first priority Liens and security interests for the benefit of Lenders in such Mortgage Loans and in all Mortgage Documents create four separate related thereto. Upon the creation of any Agency Servicing Rights relevant to FNMA on or after the Agreement Date, Agent will have a valid, enforceable, perfected first priority Lien and distinct Trust Estates and Liens: the First Priority Trust Estate and Lien securing the payment and performance of the First Priority Lien Obligationssecurity interest in such Agency Servicing Rights, the Second Priority Trust Estate and Lien securing the payment and performance of the Second Priority Lien Obligations, the Third Priority Lien Trust Estate and Lien securing the payment and performance of the Third Priority Lien, and the Other Junior Lien Trust Estate and Lien securing the payment and performance of the Other Junior Lien Obligations;
(2) (w) the Liens securing the First Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, (x) the Liens securing the Second Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations and the Liens securing the First Priority Lien Obligations, (y) the Liens securing the Third Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations and the Liens securing the Second Priority Lien Obligations and (z) the Liens securing the Other Junior Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations, the Liens securing the Second Priority Lien Obligations and the Liens securing the Third Priority Lien Obligations; and
(3) subject to the provisions of this Agreement relating only to the rights of FNMA under the applicable Agency Servicing Agreements (including the FNMA Guide). Upon the creation of any Agency Servicing Rights relevant to proceeds of FHLMC on or after the sale of property Agreement Date, Agent will have a valid, enforceable, perfected, first priority Lien and security interest in such Agency Servicing Rights, subject only to the Liens described herein andrights of FHLMC under the applicable Agency Servicing Agreements (including the FHLMC Guide). Upon the creation of any Servicing Rights other than Servicing Rights relevant to FNMA or FHLMC on or after the Agreement Date, Agent will have a valid, enforceable, perfected, first priority Lien and security interest in all such Servicing Rights other than Servicing Rights relevant to FNMA or FHLMC, subject only to the rights of Persons counterparty under the applicable Servicing Agreements (including, if applicable, the Priming Liens, any sale of property pursuant to a Lien described hereunder or, if applicable, a Priming Lien, will extinguish all Liens junior to the Lien pursuant to which such sale was made, and any property so sold will be sold free and clear of all such junior LiensGNMA Guide).
(b) The parties hereto agree that, in no event will:
(1) with respect to Collateral that is subject to a Lien in favor of any Priming Lien Secured Parties, the First Priority Debt Representatives or any First Priority Secured Parties have a Lien on or security interest in such Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties;
(2) the Second Priority Debt Representatives or any Second Priority Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties and the First Priority Lien of the First Priority Secured Parties;
(3) the Third Priority Debt Representatives or any Third Priority Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien of the First Priority Secured Parties and the Second Priority Lien of the Second Priority Secured Parties; or
(4) the Other Junior Debt Representatives or any Other Junior Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien of the First Priority Secured Parties, the Second Priority Lien of the Second Priority Secured Parties and the Third Priority Lien of the Third Priority Secured Parties.
(c) Whether or not any Insolvency Proceeding has been commenced by or against any Obligor:
(1) the Junior Priority Secured Parties will not:
(A) request judicial relief, in an Insolvency Proceeding or in any other court, that would hinder, delay, limit or prohibit the lawful exercise or enforcement of any right or remedy otherwise available to the Senior Priority Secured Parties in respect of the Collateral or that would limit, invalidate, avoid or set aside any Senior Priority Lien or subordinate any Senior Priority Liens to any Junior Priority Liens or grant Junior Priority Liens equal ranking to any Senior Priority Liens;
(B) oppose or otherwise contest any motion for relief from the automatic stay or for any injunction against foreclosure or enforcement of Senior Priority Liens made by any Senior Priority Secured Parties in any Insolvency Proceedings;
(C) oppose or otherwise contest any lawful exercise by any Senior Priority Secured Parties of the right to credit bid Senior Priority Lien Debt at any sale in foreclosure of Senior Priority Liens; or
(D) oppose or otherwise contest any other request for judicial relief made in any court by any Senior Priority Secured Party relating to the lawful enforcement of any Senior Priority Lien against the Collateral; provided, however, that notwithstanding the foregoing, both before and during an Insolvency Proceeding, the Junior Priority Secured Parties may take any actions and exercise any and all rights that would otherwise be available to a holder of unsecured claims, including, without limitation, the commencement of Insolvency Proceedings against any Obligor in accordance with applicable law; provided further, however, that the Junior Priority Secured Parties may not challenge the validity, enforceability, perfection or priority of the Senior Priority Liens; and
(2) prior to the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the First Priority Secured Parties will have the exclusive right to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Trust Estate, regardless of whether such Collateral may also be part of the Second Priority Trust Estate, the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the Second Priority Secured Parties may enforce rights, exercise remedies and take actions:
(A) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations;
(B) subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, to instruct the Collateral Agent to foreclose upon and otherwise enforce Second Priority Liens at any time after the Remedy Bar Lift Trigger Date;
(C) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(D) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Second Priority Liens upon any Collateral; or
(E) as necessary to create, prove, preserve or protect (but not enforce) the Second Priority Liens upon any Collateral.
(3) after the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, and further subject to the Collateral Agent's obligations to comply with the Act of Required Debtholders, the First Priority Secured Parties and the Second Priority Secured Parties will have the exclusive right to instruct the Collateral Agent to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Trust Estate or the Second Priority Trust Estate, regardless of whether such Collateral may also be part of the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties:
(A) the Third Priority Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Third Priority Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Third Priority Liens upon any Collateral.
(B) the Other Junior Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations, the Discharge of the Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Other Junior Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Other Junior Liens upon any Collateral.
(d) In exercising rights and remedies with respect to the Collateral, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the First Priority Secured Parties and, after the Remedy Bar Lift Trigger Date, but subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, the Second Priority Secured Parties, may enforce (or refrain from enforcing) the provisions of the Security Documents and exercise (or refrain from exercising) remedies thereunder or any such rights and remedies available at law or in equity, all in such order and in such manner as they may determine in the exercise of their sole and exclusive discretion, including:
(1) the exercise or forbearance from exercise of all rights and remedies in respect of the Collateral and/or the applicable Liens;
(2) the enforcement or forbearance from enforcement of any Lien in respect of the Collateral;
(3) the exercise or forbearance from exercise of rights and powers of a holder of shares of stock included in the Collateral to the extent provided in the Security Documents;
(4) the acceptance of the Collateral in full or partial satisfaction of the applicable Obligations; and
(5) the exercise or forbearance from exercise of all rights and remedies of a secured lender under the UCC or any similar law of any applicable jurisdiction or in equity.
(e) The parties hereto agree that:
(1) Prior to the Discharge of First Priority Lien Obligations, the Second Priority Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties (in their capacity as priority lienholders), under equitable principles.
(2) Prior to the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations, the Third Priority Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties or the Second Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles.
(3) Prior to the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations, the Other Junior Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties, the Second Priority Secured Parties or the Third Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles.
(f) Except for payments received free from the Senior Priority Liens as provided in Section 2.5(g), subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, (i) all proceeds of Collateral received by any Junior Priority Debt Representative, the Collateral Agent or any holder of Junior Priority Liens at any time prior to the Discharge of Senior Priority Lien Obligations, will be held by such Junior Priority Debt Representative, the Collateral Agent or such holder, as the case may be, for the account of the holders of Senior Priority Liens and remitted to the applicable Senior Priority Debt Representative in accordance with the terms of the Senior Priority Debt Documents.
(g) Except for payments that are made from or constitute proceeds of property subject to Senior Priority Liens and that are received by any Junior Priority Debt Representative 44 or the Collateral Agent or any holder of Junior Priority Lien Obligations at any time prior to the Discharge of Senior Priority Lien Obligations and after (i) the commencement of any Insolvency Proceeding in respect of the Company or any other Obligor or (ii) any Junior Priority Debt Representative and the Collateral Agent have received written notice from any Senior Priority Debt Representative stating that (A) any Senior Priority Lien Debt has become due and payable in full (whether at maturity, upon acceleration or otherwise) or (B) the holders of Senior Priority Liens have become entitled to and desire to enforce any or all of the Priority Liens by reason of a default under any Senior Priority Debt Document:
(1) no payment of money (or the equivalent of money) made by the Company or any other Obligor to any Junior Priority Debt Representative, the Collateral Agent or any other holder of Junior Priority Lien Obligations (including, without limitation, payments and prepayments made for application to Junior Priority Lien Obligations and all other payments and deposits made pursuant to any provision of the Junior Priority Debt Document) will in any event be the subject to the foregoing provisions of this Section 2.5; and
(2) all payments permitted to be received under this Section 2.5(g) will be received by the applicable Junior Priority Debt Representative, the Collateral Agent and other holders of Junior Priority Lien Obligations free from the Senior Priority Liens and all other Liens except the Junior Priority Liens.
Appears in 1 contract
Sources: Loan Agreement (NVR Inc)
Priority of Liens. (a) Notwithstanding anything else contained herein or in any other Security DocumentCollateral Document or in the Secured Debt Documents, it is the intent of the parties hereto Parties that:
(1i) this Agreement and the Security Collateral Documents create four three separate and distinct Trust Estates and classes of Liens: (A) the First Priority Trust Estate and Lien ABL Liens securing the payment and performance of the First ABL Obligations (B) the Priority Lien Obligations, Liens securing the payment and performance of the Priority Indebtedness Obligations and (C) the Second Priority Trust Estate and Lien Liens securing the payment and performance of the Second Priority Lien Obligations, the Third Priority Lien Trust Estate and Lien securing the payment and performance of the Third Priority Lien, and the Other Junior Lien Trust Estate and Lien securing the payment and performance of the Other Junior Lien Obligations;
(2) (wii) the ABL Liens securing shall rank first on the First ABL Collateral and the Priority Lien Obligations Liens and Second Liens on the ABL Collateral are subject and subordinate to the ABL Liens securing the Priming Lien Obligations, thereon;
(xiii) the Priority Liens securing shall rank second on the ABL Collateral and the Second Priority Lien Obligations Liens on the ABL Collateral are subject and subordinate to the Priority Liens securing the Priming Lien Obligations and the Liens securing the First Priority Lien Obligations, thereon;
(yiv) the Second Liens securing shall rank third on the Third Priority Lien Obligations ABL Collateral and are subject and subordinate to the ABL Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations and the Priority Liens securing thereon;
(v) the Priority Liens shall rank first on the Notes Collateral and the Second Priority Lien Obligations Liens and (z) ABL Liens on the Liens securing the Other Junior Lien Obligations Notes Collateral are subject and subordinate to the Priority Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations, the Liens securing thereon;
(vi) the Second Priority Lien Obligations Liens shall rank second on the Notes Collateral and the ABL Liens securing on the Third Priority Lien Obligations; and
(3) subject to the provisions of this Agreement relating to the rights to proceeds of the sale of property subject to the Liens described herein and, if applicable, the Priming Liens, any sale of property pursuant to a Lien described hereunder or, if applicable, a Priming Lien, will extinguish all Liens junior to the Lien pursuant to which such sale was made, and any property so sold will be sold free and clear of all such junior Liens.
(b) The parties hereto agree that, in no event will:
(1) with respect to Notes Collateral that is subject to a Lien in favor of any Priming Lien Secured Parties, the First Priority Debt Representatives or any First Priority Secured Parties have a Lien on or security interest in such Collateral that is not are subject and subordinate to the Priming Lien of any Priming Lien Secured Parties;Second Liens thereon; and
(2vii) the Second Priority Debt Representatives or any Second Priority Secured Parties have a Lien ABL Liens shall rank third on or security interest in any the Notes Collateral that is not and are subject and subordinate to the Priming Lien of any Priming Lien Secured Parties and the First Priority Lien of the First Priority Secured Parties;
(3) the Third Priority Debt Representatives or any Third Priority Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien of the First Priority Secured Parties Liens and the Second Priority Lien of the Second Priority Secured Parties; or
(4) the Other Junior Debt Representatives or any Other Junior Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien of the First Priority Secured Parties, the Second Priority Lien of the Second Priority Secured Parties and the Third Priority Lien of the Third Priority Secured PartiesLiens thereon.
(c) Whether or not any Insolvency Proceeding has been commenced by or against any Obligor:
(1) the Junior Priority Secured Parties will not:
(A) request judicial relief, in an Insolvency Proceeding or in any other court, that would hinder, delay, limit or prohibit the lawful exercise or enforcement of any right or remedy otherwise available to the Senior Priority Secured Parties in respect of the Collateral or that would limit, invalidate, avoid or set aside any Senior Priority Lien or subordinate any Senior Priority Liens to any Junior Priority Liens or grant Junior Priority Liens equal ranking to any Senior Priority Liens;
(B) oppose or otherwise contest any motion for relief from the automatic stay or for any injunction against foreclosure or enforcement of Senior Priority Liens made by any Senior Priority Secured Parties in any Insolvency Proceedings;
(C) oppose or otherwise contest any lawful exercise by any Senior Priority Secured Parties of the right to credit bid Senior Priority Lien Debt at any sale in foreclosure of Senior Priority Liens; or
(D) oppose or otherwise contest any other request for judicial relief made in any court by any Senior Priority Secured Party relating to the lawful enforcement of any Senior Priority Lien against the Collateral; provided, however, that notwithstanding the foregoing, both before and during an Insolvency Proceeding, the Junior Priority Secured Parties may take any actions and exercise any and all rights that would otherwise be available to a holder of unsecured claims, including, without limitation, the commencement of Insolvency Proceedings against any Obligor in accordance with applicable law; provided further, however, that the Junior Priority Secured Parties may not challenge the validity, enforceability, perfection or priority of the Senior Priority Liens; and
(2) prior to the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the First Priority Secured Parties will have the exclusive right to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Trust Estate, regardless of whether such Collateral may also be part of the Second Priority Trust Estate, the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the Second Priority Secured Parties may enforce rights, exercise remedies and take actions:
(A) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations;
(B) subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, to instruct the Collateral Agent to foreclose upon and otherwise enforce Second Priority Liens at any time after the Remedy Bar Lift Trigger Date;
(C) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(D) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Second Priority Liens upon any Collateral; or
(E) as necessary to create, prove, preserve or protect (but not enforce) the Second Priority Liens upon any Collateral.
(3) after the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, and further subject to the Collateral Agent's obligations to comply with the Act of Required Debtholders, the First Priority Secured Parties and the Second Priority Secured Parties will have the exclusive right to instruct the Collateral Agent to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Trust Estate or the Second Priority Trust Estate, regardless of whether such Collateral may also be part of the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties:
(A) the Third Priority Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Third Priority Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Third Priority Liens upon any Collateral.
(B) the Other Junior Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations, the Discharge of the Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Other Junior Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Other Junior Liens upon any Collateral.
(d) In exercising rights and remedies with respect to the Collateral, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the First Priority Secured Parties and, after the Remedy Bar Lift Trigger Date, but subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, the Second Priority Secured Parties, may enforce (or refrain from enforcing) the provisions of the Security Documents and exercise (or refrain from exercising) remedies thereunder or any such rights and remedies available at law or in equity, all in such order and in such manner as they may determine in the exercise of their sole and exclusive discretion, including:
(1) the exercise or forbearance from exercise of all rights and remedies in respect of the Collateral and/or the applicable Liens;
(2) the enforcement or forbearance from enforcement of any Lien in respect of the Collateral;
(3) the exercise or forbearance from exercise of rights and powers of a holder of shares of stock included in the Collateral to the extent provided in the Security Documents;
(4) the acceptance of the Collateral in full or partial satisfaction of the applicable Obligations; and
(5) the exercise or forbearance from exercise of all rights and remedies of a secured lender under the UCC or any similar law of any applicable jurisdiction or in equity.
(e) The parties hereto agree that:
(1) Prior to the Discharge of First Priority Lien Obligations, the Second Priority Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties (in their capacity as priority lienholders), under equitable principles.
(2) Prior to the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations, the Third Priority Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties or the Second Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles.
(3) Prior to the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations, the Other Junior Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties, the Second Priority Secured Parties or the Third Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles.
(f) Except for payments received free from the Senior Priority Liens as provided in Section 2.5(g), subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, (i) all proceeds of Collateral received by any Junior Priority Debt Representative, the Collateral Agent or any holder of Junior Priority Liens at any time prior to the Discharge of Senior Priority Lien Obligations, will be held by such Junior Priority Debt Representative, the Collateral Agent or such holder, as the case may be, for the account of the holders of Senior Priority Liens and remitted to the applicable Senior Priority Debt Representative in accordance with the terms of the Senior Priority Debt Documents.
(g) Except for payments that are made from or constitute proceeds of property subject to Senior Priority Liens and that are received by any Junior Priority Debt Representative 44 or the Collateral Agent or any holder of Junior Priority Lien Obligations at any time prior to the Discharge of Senior Priority Lien Obligations and after (i) the commencement of any Insolvency Proceeding in respect of the Company or any other Obligor or (ii) any Junior Priority Debt Representative and the Collateral Agent have received written notice from any Senior Priority Debt Representative stating that (A) any Senior Priority Lien Debt has become due and payable in full (whether at maturity, upon acceleration or otherwise) or (B) the holders of Senior Priority Liens have become entitled to and desire to enforce any or all of the Priority Liens by reason of a default under any Senior Priority Debt Document:
(1) no payment of money (or the equivalent of money) made by the Company or any other Obligor to any Junior Priority Debt Representative, the Collateral Agent or any other holder of Junior Priority Lien Obligations (including, without limitation, payments and prepayments made for application to Junior Priority Lien Obligations and all other payments and deposits made pursuant to any provision of the Junior Priority Debt Document) will in any event be the subject to the foregoing provisions of this Section 2.5; and
(2) all payments permitted to be received under this Section 2.5(g) will be received by the applicable Junior Priority Debt Representative, the Collateral Agent and other holders of Junior Priority Lien Obligations free from the Senior Priority Liens and all other Liens except the Junior Priority Liens.
Appears in 1 contract
Sources: Collateral Trust and Agency Agreement (Postmedia Network Canada Corp.)
Priority of Liens. (a) Notwithstanding anything else contained herein or in any other that the Security DocumentDocuments provide for the grant by the Grantors of Liens on the Collateral to the Administrative Agent to secure all the Obligations for the ratable benefit of the Secured Parties, it is the intent each of the parties hereto that:
(1) and, by acceptance of the benefits of this Agreement and the Security Documents, each Secured Party agrees that (i) the parties intend that the Security Documents create four separate and distinct Trust Estates and Liens: the First Priority Trust Estate and Lien securing the payment and performance of the First Priority Lien Obligations, the Second Priority Trust Estate and Lien securing the payment and performance of the Second Priority Lien Obligations, the Third Priority Lien Trust Estate and Lien securing the payment and performance of the Third Priority Lienshall be construed to create, and shall be deemed to create as between the Other Junior Lien Trust Estate and Lien securing the payment and performance of the Other Junior Lien Obligations;
(2) (w) the Lenders, first-priority Liens securing the First Priority Lien Secured Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, (x) the second-priority Liens securing the Second Priority Lien Obligations are subject and subordinate to Secured Obligations, and, accordingly, (ii) all Liens on the Liens securing the Priming Lien Obligations and the Liens Collateral (A) securing the First Priority Lien ObligationsSecured Obligations shall be and remain first-priority Liens, (y) senior in all respects and prior to all Liens on the Liens Collateral securing the Third Second Priority Lien Secured Obligations are subject and subordinate to the Liens (B) securing the Priming Lien ObligationsSecond Priority Secured Obligations shall be and remain second-priority Liens, junior in all respects to all Liens on the Liens Collateral securing the First Priority Secured Obligations, in each case whether or not any such Liens are subordinated to any other Lien securing any obligation of the Parent Borrower or any Subsidiary Guarantor. In that connection, and notwithstanding the date, manner or order of grant, attachment or perfection of any financing statement or any Liens granted to the Administrative Agent or the Secured Parties under, or any other provision of, the Security Documents or the Existing Credit Agreement (or any actual or alleged defect or deficiency in any of the foregoing) and notwithstanding any provision of the Uniform Commercial Code as enacted by any state or any applicable law or any other circumstance whatsoever, each Second Priority Secured Party hereby agrees that (x) any Lien on the Collateral securing any First Priority Secured Obligations now or hereafter held by or on behalf of the Administrative Agent or any First Priority Secured Party shall be senior in all respects and shall be a first-priority Lien, prior to any Lien on the Liens Collateral securing any of the Second Priority Lien Obligations Secured Obligations, and (zy) any Lien on the Liens Collateral securing any Second Priority Secured Obligations now or hereafter held by or on behalf of the Other Junior Lien Obligations are subject and subordinate Administrative Agent or any Second Priority Secured Party shall be junior in all respects to the Liens securing on the Priming Lien Obligations, the Liens Collateral securing the First Priority Lien Obligations, the Liens securing the Second Priority Lien Secured Obligations and the Liens securing the Third Priority Lien Obligations; and
(3) subject to the provisions of this Agreement relating to the rights to proceeds of the sale of property subject to the Liens described herein and, if applicable, the Priming Liens, any sale of property pursuant to shall be a Lien described hereunder or, if applicable, a Priming second-priority Lien, will extinguish all Liens junior to the Lien pursuant to which such sale was made, and any property so sold will be sold free and clear of all such junior Liens.
(b) The parties hereto agree that, in no event will:
(1) with respect to Collateral that is subject to a Lien in favor of any Priming Lien Secured Parties, the First Priority Debt Representatives or any First Priority Secured Parties have a Lien on or security interest in such Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties;
(2) the Second Priority Debt Representatives or any Second Priority Secured Parties have acknowledge that a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties and the First Priority Lien portion of the First Priority Secured Parties;
(3) the Third Priority Debt Representatives or any Third Priority Secured Parties have a Lien on or security interest in any Collateral Obligations represent Indebtedness that is not subject revolving in nature and subordinate that the amount thereof that may be outstanding at any time or from time to time may be increased or reduced and subsequently reborrowed, and that the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien terms of the First Priority Secured Parties Obligations may be modified, extended or amended from time to time, and the Second Priority Lien of the Second Priority Secured Parties; or
(4) the Other Junior Debt Representatives or any Other Junior Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien aggregate amount of the First Priority Secured PartiesObligations may be increased, the Second Priority Lien of replaced or refinanced, all without notice to or consent by the Second Priority Secured Parties (other than as expressly provided in the Existing Credit Agreement) and without affecting the Third Priority Lien of the Third Priority Secured Parties.
(cprovisions hereof. The priorities provided in Section 1(a) Whether or shall not any Insolvency Proceeding has been commenced by or against any Obligor:
(1) the Junior Priority Secured Parties will not:
(A) request judicial relief, in an Insolvency Proceeding or in any other court, that would hinder, delay, limit or prohibit the lawful exercise or enforcement of any right or remedy otherwise available to the Senior Priority Secured Parties in respect of the Collateral or that would limit, invalidate, avoid or set aside any Senior Priority Lien or subordinate any Senior Priority Liens to any Junior Priority Liens or grant Junior Priority Liens equal ranking to any Senior Priority Liens;
(B) oppose be altered or otherwise contest any motion for relief from the automatic stay or for any injunction against foreclosure or enforcement of Senior Priority Liens made affected by any Senior Priority Secured Parties in any Insolvency Proceedings;
(C) oppose amendment, modification, supplement, extension, increase, replacement, renewal, restatement or otherwise contest any lawful exercise by any Senior Priority Secured Parties refinancing of the right to credit bid Senior Priority Lien Debt at any sale in foreclosure of Senior Priority Liens; or
(D) oppose or otherwise contest any other request for judicial relief made in any court by any Senior Priority Secured Party relating to the lawful enforcement of any Senior Priority Lien against the Collateral; provided, however, that notwithstanding the foregoing, both before and during an Insolvency Proceeding, the Junior Priority Secured Parties may take any actions and exercise any and all rights that would otherwise be available to a holder of unsecured claims, including, without limitation, the commencement of Insolvency Proceedings against any Obligor in accordance with applicable law; provided further, however, that the Junior Priority Secured Parties may not challenge the validity, enforceability, perfection or priority of the Senior Priority Liens; and
(2) prior to the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, either the First Priority Secured Parties will have the exclusive right to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Trust Estate, regardless of whether such Collateral may also be part of the Second Priority Trust Estate, the Third Priority Trust Estate Obligations or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the Second Priority Secured Parties may enforce rights, exercise remedies and take actions:
(A) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations;
(B) subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, to instruct the Collateral Agent to foreclose upon and otherwise enforce Second Priority Liens at any time after the Remedy Bar Lift Trigger Date;
(C) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(D) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Second Priority Liens upon any Collateral; or
(E) as necessary to create, prove, preserve or protect (but not enforce) the Second Priority Liens upon any Collateral.
(3) after the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, and further subject to the Collateral Agent's obligations to comply with the Act of Required Debtholders, the First Priority Secured Parties and the Second Priority Secured Parties will have the exclusive right to instruct the Collateral Agent to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Trust Estate or the Second Priority Trust Estate, regardless of whether such Collateral may also be part of the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties:
(A) the Third Priority Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Third Priority Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Third Priority Liens upon any Collateral.
(B) the Other Junior Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations, the Discharge of the Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Other Junior Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Other Junior Liens upon any Collateral.
(d) In exercising rights and remedies with respect to the Collateral, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the First Priority Secured Parties and, after the Remedy Bar Lift Trigger Date, but subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, the Second Priority Secured Parties, may enforce (or refrain from enforcing) the provisions of the Security Documents and exercise (or refrain from exercising) remedies thereunder or any such rights and remedies available at law or in equityportion thereof, all in such order and in such manner as they may determine in the exercise of their sole and exclusive discretion, including:
(1) the exercise or forbearance from exercise of all rights and remedies in respect of the Collateral and/or the applicable Liens;
(2) the enforcement or forbearance from enforcement of nor by any Lien in respect of the Collateral;
(3) the exercise or forbearance from exercise of rights and powers of a holder of shares of stock included in the Collateral to the extent provided in the Security Documents;
(4) the acceptance of the Collateral in full or partial satisfaction of the applicable Obligations; and
(5) the exercise or forbearance from exercise of all rights and remedies of a secured lender under the UCC or any similar law of any applicable jurisdiction or in equity.
(e) The parties hereto agree that:
(1) Prior to the Discharge of First Priority Lien Obligations, the Second Priority Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties (in their capacity as priority lienholders), under equitable principles.
(2) Prior to the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations, the Third Priority Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against action that the First Priority Secured Parties or the Second Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles.
(3) Prior may take or fail to the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations, the Other Junior Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties, the Second Priority Secured Parties or the Third Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles.
(f) Except for payments received free from the Senior Priority Liens as provided in Section 2.5(g), subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, (i) all proceeds of Collateral received by any Junior Priority Debt Representative, the Collateral Agent or any holder of Junior Priority Liens at any time prior to the Discharge of Senior Priority Lien Obligations, will be held by such Junior Priority Debt Representative, the Collateral Agent or such holder, as the case may be, for the account of the holders of Senior Priority Liens and remitted to the applicable Senior Priority Debt Representative in accordance with the terms of the Senior Priority Debt Documents.
(g) Except for payments that are made from or constitute proceeds of property subject to Senior Priority Liens and that are received by any Junior Priority Debt Representative 44 or the Collateral Agent or any holder of Junior Priority Lien Obligations at any time prior to the Discharge of Senior Priority Lien Obligations and after (i) the commencement of any Insolvency Proceeding take in respect of the Company or any other Obligor or (ii) any Junior Priority Debt Representative and the Collateral Agent have received written notice from any Senior Priority Debt Representative stating that (A) any Senior Priority Lien Debt has become due and payable in full (whether at maturity, upon acceleration or otherwise) or (B) the holders of Senior Priority Liens have become entitled to and desire to enforce any or all of the Priority Liens by reason of a default under any Senior Priority Debt Document:
(1) no payment of money (or the equivalent of money) made by the Company or any other Obligor to any Junior Priority Debt Representative, the Collateral Agent or any other holder of Junior Priority Lien Obligations (including, without limitation, payments and prepayments made for application to Junior Priority Lien Obligations and all other payments and deposits made pursuant to any provision of the Junior Priority Debt Document) will in any event be the subject to the foregoing provisions of this Section 2.5; and
(2) all payments permitted to be received under this Section 2.5(g) will be received by the applicable Junior Priority Debt Representative, the Collateral Agent and other holders of Junior Priority Lien Obligations free from the Senior Priority Liens and all other Liens except the Junior Priority LiensCollateral.
Appears in 1 contract
Sources: Credit Agreement (Knowles Electronics Holdings Inc)
Priority of Liens. (a) Notwithstanding anything else contained herein or in any other Security Document, it is the intent of the parties hereto that:
: (1i) this Agreement and the Security Documents create four two separate and distinct Trust Estates and Liens: the First Priority Senior Trust Estate and Lien securing the payment and performance of the First Priority Lien Obligations, Obligations and the Second Priority Junior Trust Estate and Lien securing the payment and performance of the Second Priority Lien Obligations, the Third Priority Lien Trust Estate Obligations and Lien securing the payment and performance of the Third Priority Lien, and the Other Junior Lien Trust Estate and Lien securing the payment and performance of the Other Junior Lien Obligations;
(2) (wii) the Liens securing the First Priority Second Lien Obligations are subject and subordinate (in accordance with the terms hereof and of the other Security Documents) to the Liens securing the Priming Lien Obligations, (x) the Liens securing the Second Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations and the Liens securing the First Priority Lien Obligations, (y) the Liens securing the Third Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations and the Liens securing the Second Priority Lien Obligations and (z) the Liens securing the Other Junior Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations, the Liens securing the Second Priority Lien Obligations and the Liens securing the Third Priority Lien Obligations; and
(3) subject to the provisions of this Agreement relating to the rights to proceeds of the sale of property subject to the Liens described herein and, if applicable, the Priming Liens, any sale of property pursuant to a Lien described hereunder or, if applicable, a Priming Lien, will extinguish all Liens junior to the Lien pursuant to which such sale was made, and any property so sold will be sold free and clear of all such junior Liens.
(b) The parties hereto agree that, prior to the Discharge of Priority Lien Obligations, in no event will:
(1) with respect to Collateral that is subject to a Lien in favor of any Priming Lien Secured Parties, the First Priority Debt Representatives or any First Priority Secured Parties have a Lien on or security interest in such Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties;
(2) shall the Second Priority Lien Debt Representatives or any Second Priority Lien Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming first priority lien of the Priority Lien Secured Parties. Notwithstanding (i) anything to the contrary contained in any Second Lien Document and irrespective of the time, order or method of attachment or perfection of the security interests created by the Priority Lien Documents or the Second Lien Documents, (ii) anything contained in any Priming filing or agreement to which the Priority Lien Secured Parties or Second Lien Secured Parties or any other party hereto may be a party and the First Priority Lien of the First Priority Secured Parties;
(3iii) the Third Priority Debt Representatives rules for determining priority under the UCC or any Third Priority Secured Parties have a Lien on or other law governing the relative priorities of secured creditors, any security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien part of the First Priority Secured Parties Senior Trust Estate has and the Second Priority Lien of the Second Priority Secured Parties; or
(4) the Other Junior Debt Representatives or shall have priority over any Other Junior Secured Parties have a Lien on or security interest in any such Collateral that is not part of the Junior Trust Estate. For the avoidance of doubt, in the event that any holder of Second Lien Obligations becomes a judgment lien creditor as a result of its enforcement of its rights as an unsecured creditor, such judgment lien shall be subject and subordinate to the Priming Lien terms of any Priming Lien Secured Parties, this Agreement for all purposes hereof (including the First Priority Lien priority of the First Priority Secured Parties, the Second Priority Lien of the Second Priority Secured Parties and the Third Priority Lien of the Third Priority Secured PartiesLiens).
(c) Whether or not any Bankruptcy Case or Insolvency Proceeding has been commenced by or against any Obligor:
, until the Discharge of Priority Lien Obligations, (1i) the Junior Priority Second Lien Secured Parties will not:
not (A) request judicial reliefexercise or seek to exercise any rights or exercise any remedies with respect to any Collateral that is subject to the Senior Trust Estate, in an Insolvency Proceeding (B) institute any action or in proceeding with respect to such rights or remedies with respect to any Collateral, including any action of foreclosure, or take any other courtaction, that would hinder, delay, delay limit or prohibit the lawful exercise or enforcement of any right or remedy otherwise available to the Senior Priority Lien Secured Parties, (C) contest, protest or object to any foreclosure proceeding or action brought by the Priority Lien Secured Parties or any other exercise by the Priority Lien Secured Parties of any rights and remedies under any Priority Lien Documents relating to the Collateral that is subject to the Senior Trust Estate, (D) object to the forbearance by the Priority Lien Secured Parties to the bringing or pursuing of any foreclosure proceeding or action or any other exercise of any rights or remedies relating to the Collateral that is subject to the Senior Trust Estate, (E) take or receive from the Obligors, directly or indirectly, in respect of cash or other property or by setoff or in any other manner, the Collateral or that would limitany part thereof or proceeds therefrom in satisfaction of the Second Lien Obligations, invalidate, avoid (F) contest or set aside seek to invalidate any Senior Liens or security interests securing the Priority Lien Obligations, or subordinate the perfection thereof, or the validity or enforceability of this Agreement or the amount, nature or extent of the Priority Lien Obligations, (G) take or permit any action prejudicial to or inconsistent with the priority position of the Senior Priority Liens Trust Estate over the Junior Trust Estate, (H) object to any Junior adequate protection or similar relief requested and obtained by the Priority Liens or grant Junior Priority Liens equal ranking to any Senior Priority Liens;
(B) oppose or otherwise contest any motion for relief from the automatic stay or for any injunction against foreclosure or enforcement of Senior Priority Liens made by any Senior Priority Lien Secured Parties in any Insolvency Proceedings;
Proceeding or Bankruptcy Case with respect to any Obligor or (CI) oppose object to any consent or otherwise contest any lawful exercise approval by any Senior the Priority Lien Secured Parties to the use of cash or other Collateral, or any similar relief, in any Insolvency Proceeding or Bankruptcy Case with respect to any Obligor, and (ii) the right to credit bid Senior Priority Lien Debt at any sale in foreclosure of Senior Priority Liens; or
(D) oppose or otherwise contest any other request for judicial relief made in any court by any Senior Priority Secured Party relating to the lawful enforcement of any Senior Priority Lien against the Collateral; provided, however, that notwithstanding the foregoing, both before and during an Insolvency Proceeding, the Junior Priority Secured Parties may take any actions and exercise any and all rights that would otherwise be available to a holder of unsecured claims, including, without limitation, the commencement of Insolvency Proceedings against any Obligor in accordance with applicable law; provided further, however, that the Junior Priority Secured Parties may not challenge the validity, enforceability, perfection or priority of the Senior Priority Liens; and
(2) prior to the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the First Priority Secured Parties will shall have the exclusive right to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Senior Trust Estate, regardless of whether such Collateral may also be part of the Second Priority Trust Estate, the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, the Second Lien Secured Parties may, subject to the rights of any holders of Permitted Prior LiensSection 8.2, including any Priming Lien Secured Parties, the Second Priority Secured Parties may enforce rights, exercise remedies and take actions:
actions (Ax) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations;
, (B) subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, to instruct the Collateral Agent to foreclose upon and otherwise enforce Second Priority Liens at any time after the Remedy Bar Lift Trigger Date;
(C) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(Dy) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the a Second Priority Liens Lien upon any Collateral; or
Collateral by any method of perfection except through possession or control or (Ez) as necessary to create, prove, preserve or protect (but not enforce) the Liens securing the Second Priority Liens upon Lien Obligations. Nothing in this Agreement will be deemed to prohibit or restrict the ability of the Secured Parties to accept proceeds pursuant to any Collateral.
Hedging Agreement in the ordinary course of business and in accordance with the terms of each Secured Debt Document (3) after and, for the Remedy Bar Lift Trigger Dateavoidance of doubt, subject to not in connection with the rights exercise of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, and further subject to the Collateral Agent's obligations to comply with the Act of Required Debtholders, the First Priority Secured Parties and the Second Priority Secured Parties will have the exclusive right to instruct the Collateral Agent to enforce rights and exercise remedies with respect remedies) prior to any Collateral that is part of the First Priority Trust Estate or the Second Priority Trust Estate, regardless of whether such Collateral may also be part of the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties:
(A) the Third Priority Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations in the an event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish default under the priority (subject to Senior Priority Liens) of the Third Priority Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Third Priority Liens upon any Collateral.
(B) the Other Junior applicable Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations, the Discharge of the Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Other Junior Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Other Junior Liens upon any CollateralDebt Document.
(d) In exercising rights and remedies with respect to the Collateral, subject to the rights of any holders of Permitted Prior LiensPriority Debt Representatives shall have, including any Priming Lien Secured Parties, the First Priority Secured Parties and, after the Remedy Bar Lift Trigger Date, but subject to the Collateral Agent's obligation to comply by or with the consent of an Act of Required Instructing Debtholders, the Second Priority Secured Parties, may exclusive right to direct the Collateral Trustee to enforce (or refrain from enforcing) the provisions of the Security Priority Lien Documents and to exercise (or refrain from exercising) remedies thereunder or any such rights and remedies available at law or in equityremedies, all in such order and in such manner as they may determine in the exercise of their sole and exclusive discretion, including:
including (1i) the exercise or forbearance from exercise of all rights and remedies in respect of the Collateral and/or the applicable Liens;
Priority Lien Obligations, (2ii) the enforcement or forbearance from enforcement of any Lien in respect of the Collateral;
, (3iii) the release (or subordination), with or without consideration, of the Collateral (or Collateral Trustee’s Lien) from the Senior Trust Estate, and, in connection with any such release (or subordination), the concurrent release (or subordination) subject to Article IV, with or without consideration (as determined by the Priority Lien Secured Parties), of such collateral (or Collateral Trustee’s Lien) from the Junior Trust Estate, (iv) the exercise or forbearance from exercise of rights and powers of a holder of shares of stock included in the Collateral Senior Trust Estate to the extent provided in the Security Documents;
, (4v) the acceptance of the Collateral in full or partial satisfaction of the applicable Obligations; and
Priority Lien Obligations and (5vi) the exercise or forbearance from exercise of all rights and remedies of a secured lender under the UCC or any similar law of any applicable jurisdiction or in equityequity and no Second Lien Secured Party shall contest, protest or object to any of the foregoing actions.
(e) The parties hereto agree that:
(1) Prior Without in any way limiting the generality of the foregoing paragraphs, the Priority Lien Secured Parties of any Series of Priority Lien Debt may, at any time and from time to time, without the consent of or notice to the Discharge Second Lien Secured Parties, without incurring responsibility to the Second Lien Secured Parties and without impairing or releasing the subordination provided in this Agreement or the obligations hereunder of First the Second Lien Secured Parties, do any one or more of the following with respect to such Series of Priority Lien Debt: (i) change the manner, place or terms of payment or extend the time of payment of, or renew or alter, such Priority Lien Obligations, or otherwise amend, restate, supplement, replace or refinance in any manner such Priority Lien Obligations, or any instrument evidencing such Priority Lien Obligations or any agreement under which such Priority Lien Obligations are outstanding, (ii) release any Person or entity liable in any manner for the Second collection of such Priority Secured Parties and Lien Obligations, (iii) release or subordinate the Lien on any Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties (in their capacity as priority lienholders), under equitable principles.
(2) Prior to the Discharge of First securing such Priority Lien Obligations and the Discharge of Second Priority Lien Obligations, the Third Priority Secured Parties and the Collateral Agent may not assert (iv) exercise or enforce refrain from exercising any right of marshalling accorded to a junior lienholders, as rights against the First Priority Secured Parties or the Second Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles.
(3) Prior to the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations, the Other Junior Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties, the Second Priority Secured Parties or the Third Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principlesObligor.
(f) Except The doctrine of marshalling of assets or collateral or any other legal or equitable principle or doctrine which could otherwise, in any way, constrain, limit or affect the order or manner of the enforcement against any Person obligated for payments received free from the Priority Lien Obligations or the liquidation of the Senior Priority Liens as provided in Section 2.5(g), subject Trust Estate shall not be applicable to the Senior Trust Estate or to the rights of any holders of Permitted Prior Liens, including any Priming the Priority Lien Secured Parties, Parties under this Agreement. The Collateral Trustee on behalf of itself and each Second Lien Secured Party hereby waives any right to require marshalling of any assets securing the Priority Lien Obligations whether or not such assets are part of the Senior Trust Estate.
(ig) all proceeds of Collateral received by any Junior Priority Debt Representative, the Collateral Agent or any holder of Junior Priority Liens at At any time prior to the Discharge of Senior Priority Lien Obligations, will be held by such Junior Priority Debt Representative, the Collateral Agent or such holder, as the case may be, for the account of the holders of Senior Priority Liens and remitted to the applicable Senior Priority Debt Representative in accordance with the terms of the Senior Priority Debt Documents.
(g) Except for payments that are made from or constitute proceeds of property subject to Senior Priority Liens and that are received by any Junior Priority Debt Representative 44 or the Collateral Agent or any holder of Junior Priority Lien Obligations at any time prior to the Discharge of Senior Priority Lien Obligations and after (i1) the commencement of any Bankruptcy Case or Insolvency Proceeding in respect of the Company any Borrower or any other Obligor or (ii2) any Junior Priority the Collateral Trustee and each Second Lien Debt Representative and the Collateral Agent have received written notice from any Senior Priority Debt Representative at the direction of an Act of Instructing Debtholders stating that (A) any Senior Series of Priority Lien Debt has become due and payable in full (whether at maturity, upon acceleration or otherwise) or (B) the holders of Senior Priority Liens securing one or more Series of Priority Lien Debt have become entitled under any Priority Lien Documents to and desire to enforce any or all of the Priority Liens by reason of a an event of default under any Senior such Priority Debt Document:
(1) Lien Documents, no payment of money (or the equivalent of money) shall be made from the proceeds of Collateral by the Company any Borrower or any other Obligor to any Junior Priority Debt Representative, the Collateral Agent Trustee (other than payments to the Collateral Trustee for the benefit of the Priority Lien Secured Parties) or any other holder of Junior Priority Second Lien Obligations Secured Party (including, without limitation, payments and prepayments made for application to Junior Priority Second Lien Obligations and all other payments and deposits made pursuant to any provision of any Second Lien Document).
(h) All proceeds of Collateral received by the Junior Collateral Trustee, any Second Lien Debt Representative or any holder of Second Lien Obligations in violation of Section 2.3(g) will be held by the Collateral Trustee, the applicable Second Lien Debt Representative or the applicable holder of Second Lien Obligations for the account of the holders of Priority Liens and remitted to the Collateral Trustee upon demand by any Priority Debt Document) Representative for application in accordance with Section 3.4. The Second Liens will in any event be the remain attached to and enforceable against all proceeds so held or remitted, subject to the foregoing provisions terms of this Agreement. All proceeds of Collateral received by the Collateral Trustee, holders of Second Lien Obligations and Second Lien Debt Representatives not in violation of Section 2.5; and
(2) all payments permitted to be received under this Section 2.5(g2.3(g) will be received by the applicable Junior Priority Debt RepresentativeCollateral Trustee, the Collateral Agent and other holders of Junior Priority Second Lien Obligations and the Second Lien Debt Representatives free from the Senior Priority Liens and all other Liens except the Junior Priority Liens.
Appears in 1 contract
Priority of Liens. (a) Notwithstanding anything else contained herein 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 or instrument, or other method of perfecting a security interest in favor of each Creditor in any other Security DocumentLender Priority Collateral, it is the intent and notwithstanding any conflicting terms or conditions which may be contained in any of the parties hereto thatAgreements the following Lien priorities shall strictly apply in defining the respective Lien priorities of each Creditor in the Lender Priority Collateral:
(1i) this Agreement and the Security Documents create four separate and distinct Trust Estates and Liensfirst: the First Liens upon such Lender Priority Trust Estate and Lien securing Collateral of Revolving Loan Agent to the payment and performance full extent of the First Priority Lien Obligations, the Second Priority Trust Estate and Lien securing the payment and performance of the Second Priority Lien Obligations, the Third Priority Lien Trust Estate and Lien securing the payment and performance of the Third Priority Lien, and the Other Junior Lien Trust Estate and Lien securing the payment and performance of the Other Junior Lien ObligationsRevolving Loan Debt;
(2ii) (w) second: the Liens securing the First upon such Lender Priority Lien Obligations are subject and subordinate Collateral of Cleveland to the Liens securing the Priming Lien Obligations, (x) the Liens securing the Second Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations and the Liens securing the First Priority Lien Obligations, (y) the Liens securing the Third Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations and the Liens securing the Second Priority Lien Obligations and (z) the Liens securing the Other Junior Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations, the Liens securing the Second Priority Lien Obligations and the Liens securing the Third Priority Lien Obligations; and
(3) subject to the provisions of this Agreement relating to the rights to proceeds full extent of the sale of property subject to the Liens described herein and, if applicable, the Priming Liens, any sale of property pursuant to a Lien described hereunder or, if applicable, a Priming Lien, will extinguish all Liens junior to the Lien pursuant to which such sale was made, and any property so sold will be sold free and clear of all such junior Liens.
(b) The parties hereto agree that, in no event will:
(1) with respect to Collateral that is subject to a Lien in favor of any Priming Lien Secured Parties, the First Priority Debt Representatives or any First Priority Secured Parties have a Lien on or security interest in such Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured PartiesCleveland Debt;
(2iii) third: the Second Liens upon such Lender Priority Debt Representatives or any Second Priority Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate of Ford to the Priming Lien of any Priming Lien Secured Parties and the First Priority Lien full extent of the First Priority Secured PartiesFord Debt;
(3iv) fourth: the Third Liens upon such Lender Priority Debt Representatives or any Third Priority Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate of Cleveland Subsidiary to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien full extent of the First Priority Secured Parties and the Second Priority Lien Cleveland Subsidiary Debt consisting of the Second Priority Secured Parties; or
(4) the Other Junior Debt Representatives or any Other Junior Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien of the First Priority Secured Parties, the Second Priority Lien of the Second Priority Secured Parties and the Third Priority Lien of the Third Priority Secured Parties.
(c) Whether or not any Insolvency Proceeding has been commenced by or against any Obligor:
(1) the Junior Priority Secured Parties will not:
(A) request judicial relief, in an Insolvency Proceeding or in any other court, that would hinder, delay, limit or prohibit the lawful exercise or enforcement of any right or remedy otherwise available to the Senior Priority Secured Parties in respect of the Collateral or that would limit, invalidate, avoid or set aside any Senior Priority Lien or subordinate any Senior Priority Liens to any Junior Priority Liens or grant Junior Priority Liens equal ranking to any Senior Priority Liens;
(B) oppose or otherwise contest any motion for relief from the automatic stay or for any injunction against foreclosure or enforcement of Senior Priority Liens made by any Senior Priority Secured Parties in any Insolvency Proceedings;
(C) oppose or otherwise contest any lawful exercise by any Senior Priority Secured Parties of the right to credit bid Senior Priority Lien Debt at any sale in foreclosure of Senior Priority Liens; or
(D) oppose or otherwise contest any other request for judicial relief made in any court by any Senior Priority Secured Party relating to the lawful enforcement of any Senior Priority Lien against the Collateral; provided, however, that notwithstanding the foregoing, both before and during an Insolvency Proceeding, the Junior Priority Secured Parties may take any actions and exercise any and all rights that would otherwise be available to a holder of unsecured claims, including, without limitation, the commencement of Insolvency Proceedings against any Obligor in accordance with applicable law; provided further, however, that the Junior Priority Secured Parties may not challenge the validity, enforceability, perfection or priority of the Senior Priority Liens; and
(2) prior to the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the First Priority Secured Parties will have the exclusive right to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Trust Estate, regardless of whether such Collateral may also be part of the Second Priority Trust Estate, the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the Second Priority Secured Parties may enforce rights, exercise remedies and take actions:
(A) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations;
(B) subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, to instruct the Collateral Agent to foreclose upon and otherwise enforce Second Priority Liens at any time after the Remedy Bar Lift Trigger Date;
(C) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(D) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Second Priority Liens upon any Collateral; or
(E) as necessary to create, prove, preserve or protect (but not enforce) the Second Priority Liens upon any Collateral.
(3) after the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, and further subject to the Collateral Agent's obligations to comply with the Act of Required Debtholders, the First Priority Secured Parties and the Second Priority Secured Parties will have the exclusive right to instruct the Collateral Agent to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Trust Estate or the Second Priority Trust Estate, regardless of whether such Collateral may also be part of the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties:
(A) the Third Priority Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien ObligationsCleveland Subsidiary Inventory Payable;
(b) as necessary to redeem 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 or instrument, or other method of perfecting a security interest in favor of each Creditor in any Cleveland Subsidiary Priority Collateral, and notwithstanding any conflicting terms or conditions which may be contained in any of the Agreements the following Lien priorities shall strictly apply in defining the respective Lien priorities of each Creditor in the Cleveland Subsidiary Priority Collateral:
(subject i) first: the Liens upon such Cleveland Subsidiary Priority Collateral of Cleveland Subsidiary to the prior Discharge full extent of First Priority Lien Obligations and Discharge the Cleveland Subsidiary Debt consisting of Second Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations in the event of foreclosure or other enforcement of any prior LienCleveland Subsidiary Inventory Payable;
(cii) as necessary second: the Liens upon such Cleveland Subsidiary Priority Collateral of Revolving Loan Agent to perfect or establish the priority (subject to Senior Priority Liens) full extent of the Third Priority Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Third Priority Liens upon any Collateral.
(B) the Other Junior Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations, the Discharge of the Second Priority Lien Obligations and the Discharge of Third Priority Lien ObligationsRevolving Loan Debt;
(biii) as necessary to redeem (subject third: the Liens upon such Cleveland Subsidiary Priority Collateral of Cleveland to the prior Discharge full extent of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations in the event of foreclosure or other enforcement of any prior LienCleveland Debt;
(civ) as necessary fourth: the Liens upon such Cleveland Subsidiary Priority Collateral of Ford to perfect or establish the priority (subject to Senior Priority Liens) full extent of the Other Junior Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Other Junior Liens upon any CollateralFord Debt.
(d) In exercising rights and remedies with respect to the Collateral, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the First Priority Secured Parties and, after the Remedy Bar Lift Trigger Date, but subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, the Second Priority Secured Parties, may enforce (or refrain from enforcing) the provisions of the Security Documents and exercise (or refrain from exercising) remedies thereunder or any such rights and remedies available at law or in equity, all in such order and in such manner as they may determine in the exercise of their sole and exclusive discretion, including:
(1) the exercise or forbearance from exercise of all rights and remedies in respect of the Collateral and/or the applicable Liens;
(2) the enforcement or forbearance from enforcement of any Lien in respect of the Collateral;
(3) the exercise or forbearance from exercise of rights and powers of a holder of shares of stock included in the Collateral to the extent provided in the Security Documents;
(4) the acceptance of the Collateral in full or partial satisfaction of the applicable Obligations; and
(5) the exercise or forbearance from exercise of all rights and remedies of a secured lender under the UCC or any similar law of any applicable jurisdiction or in equity.
(e) The parties hereto agree that:
(1) Prior to the Discharge of First Priority Lien Obligations, the Second Priority Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties (in their capacity as priority lienholders), under equitable principles.
(2) Prior to the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations, the Third Priority Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties or the Second Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles.
(3) Prior to the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations, the Other Junior Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties, the Second Priority Secured Parties or the Third Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles.
(f) Except for payments received free from the Senior Priority Liens as provided in Section 2.5(g), subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, (i) all proceeds of Collateral received by any Junior Priority Debt Representative, the Collateral Agent or any holder of Junior Priority Liens at any time prior to the Discharge of Senior Priority Lien Obligations, will be held by such Junior Priority Debt Representative, the Collateral Agent or such holder, as the case may be, for the account of the holders of Senior Priority Liens and remitted to the applicable Senior Priority Debt Representative in accordance with the terms of the Senior Priority Debt Documents.
(g) Except for payments that are made from or constitute proceeds of property subject to Senior Priority Liens and that are received by any Junior Priority Debt Representative 44 or the Collateral Agent or any holder of Junior Priority Lien Obligations at any time prior to the Discharge of Senior Priority Lien Obligations and after (i) the commencement of any Insolvency Proceeding in respect of the Company or any other Obligor or (ii) any Junior Priority Debt Representative and the Collateral Agent have received written notice from any Senior Priority Debt Representative stating that (A) any Senior Priority Lien Debt has become due and payable in full (whether at maturity, upon acceleration or otherwise) or (B) the holders of Senior Priority Liens have become entitled to and desire to enforce any or all of the Priority Liens by reason of a default under any Senior Priority Debt Document:
(1) no payment of money (or the equivalent of money) made by the Company or any other Obligor to any Junior Priority Debt Representative, the Collateral Agent or any other holder of Junior Priority Lien Obligations (including, without limitation, payments and prepayments made for application to Junior Priority Lien Obligations and all other payments and deposits made pursuant to any provision of the Junior Priority Debt Document) will in any event be the subject to the foregoing provisions of this Section 2.5; and
(2) all payments permitted to be received under this Section 2.5(g) will be received by the applicable Junior Priority Debt Representative, the Collateral Agent and other holders of Junior Priority Lien Obligations free from the Senior Priority Liens and all other Liens except the Junior Priority Liens.
Appears in 1 contract
Sources: Intercreditor and Subordination Agreement (Rouge Industries Inc)
Priority of Liens. (a) Notwithstanding anything else contained herein or in any other Security Document, it is the intent of the parties hereto that:
: (1i) this Agreement and the Security Documents create four two separate and distinct Trust Estates and Liens: the First Priority Senior Trust Estate and Lien securing the payment and performance of the First Priority Lien Obligations, Obligations and the Second Priority Junior Trust Estate and Lien securing the payment and performance of the Second Priority Parity Lien Obligations, the Third Priority Lien Trust Estate Obligations and Lien securing the payment and performance of the Third Priority Lien, and the Other Junior Lien Trust Estate and Lien securing the payment and performance of the Other Junior Lien Obligations;
(2) (wii) the Liens securing the First Priority Parity Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, (x) the Liens securing the Second Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations and the Liens securing the First Priority Lien Obligations, (y) the Liens securing the Third Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations and the Liens securing the Second Priority Lien Obligations and (z) the Liens securing the Other Junior Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations, the Liens securing the Second Priority Lien Obligations and the Liens securing the Third Priority Lien Obligations; and
(3) subject to the provisions of this Agreement relating to the rights to proceeds of the sale of property subject to the Liens described herein and, if applicable, the Priming Liens, any sale of property pursuant to a Lien described hereunder or, if applicable, a Priming Lien, will extinguish all Liens junior to the Lien pursuant to which such sale was made, and any property so sold will be sold free and clear of all such junior Liens.
(b) The parties hereto agree that, after the date hereof and prior to the Discharge of Priority Lien Obligations, in no event will:
(1) with respect to Collateral that is subject to a Lien in favor of any Priming Lien Secured Parties, shall the First Priority Parity Debt Representatives or any First Priority Secured Parties have a Parity Lien on or security interest in such Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties;
(2) the Second Priority Debt Representatives or any Second Priority Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming first priority lien of the Priority Lien Secured Parties. Notwithstanding (i) anything to the contrary contained in any Parity Lien Document and irrespective of the time, order or method of attachment or perfection of the security interests created by the Priority Lien Documents or the Parity Lien Documents, (ii) anything contained in any Priming filing or agreement to which the Priority Lien Secured Parties or Parity Lien Secured Parties or any other party hereto may be a party and the First Priority Lien of the First Priority Secured Parties;
(3iii) the Third Priority Debt Representatives rules for determining priority under the UCC or any Third Priority Secured Parties have a Lien on or other law governing the relative priorities of secured creditors, any security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien part of the First Priority Secured Parties Senior Trust Estate has and the Second Priority Lien of the Second Priority Secured Parties; or
(4) the Other Junior Debt Representatives or shall have priority over any Other Junior Secured Parties have a Lien on or security interest in any such Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien part of the First Priority Secured Parties, the Second Priority Lien of the Second Priority Secured Parties and the Third Priority Lien of the Third Priority Secured PartiesJunior Trust Estate.
(c) Whether or not any Bankruptcy Case or Insolvency Proceeding has been commenced by or against any Obligor:
, until the Discharge of Priority Lien Obligations, (1i) the Junior Priority Parity Lien Secured Parties will not:
not (A) request judicial reliefexercise or seek to exercise any rights or exercise any remedies with respect to any Collateral that is subject to the Senior Trust Estate, (B) institute any action or proceeding with respect to such rights or remedies with respect to any Collateral, including any action of foreclosure, (C) contest, protest or object to any foreclosure proceeding or action brought by the Priority Lien Secured Parties or any other exercise by the Priority Lien Secured Parties of any rights and remedies under any Priority Lien Documents relating to the Collateral that is subject to the Senior Trust Estate, (D) object to the forbearance by the Priority Lien Secured Parties to the bringing or pursuing of any foreclosure proceeding or action or any other exercise of any rights or remedies relating to the Collateral that is subject to the Senior Trust Estate, (E) take or receive from the Obligors, directly or indirectly, in an Insolvency Proceeding cash or other property or by set off or in any other courtmanner, that would hinder, delay, limit or prohibit the lawful exercise or enforcement of any right or remedy otherwise available to the Senior Priority Secured Parties in respect of the Collateral or that would limitany part thereof or proceeds therefrom in satisfaction of the Parity Lien Obligations, invalidate(F) contest or seek to invalidate any Liens or security interests securing the Priority Debt Obligations, avoid or set aside the perfection thereof, or the validity or enforceability of this Agreement, (G) take or permit any action prejudicial to or inconsistent with the priority position of the Senior Trust Estate over the Junior Trust Estate, (H) object to any adequate protection or similar relief requested and obtained by the Priority Lien or subordinate any Senior Priority Liens to any Junior Priority Liens or grant Junior Priority Liens equal ranking to any Senior Priority Liens;
(B) oppose or otherwise contest any motion for relief from the automatic stay or for any injunction against foreclosure or enforcement of Senior Priority Liens made by any Senior Priority Secured Parties in any Insolvency Proceedings;
Proceeding or Bankruptcy Case with respect to any Obligor or (CI) oppose object to any consent or otherwise contest any lawful exercise approval by any Senior the Priority Lien Secured Parties to the use of cash or other Collateral, or any similar relief, in any Insolvency Proceeding or Bankruptcy Case with respect to any Obligor, and (ii) the right to credit bid Senior Priority Lien Debt at any sale in foreclosure of Senior Priority Liens; or
(D) oppose or otherwise contest any other request for judicial relief made in any court by any Senior Priority Secured Party relating to the lawful enforcement of any Senior Priority Lien against the Collateral; provided, however, that notwithstanding the foregoing, both before and during an Insolvency Proceeding, the Junior Priority Secured Parties may take any actions and exercise any and all rights that would otherwise be available to a holder of unsecured claims, including, without limitation, the commencement of Insolvency Proceedings against any Obligor in accordance with applicable law; provided further, however, that the Junior Priority Secured Parties may not challenge the validity, enforceability, perfection or priority of the Senior Priority Liens; and
(2) prior to the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the First Priority Secured Parties will shall have the exclusive right to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Senior Trust Estate, regardless of whether such Collateral may also be part of the Second Priority Trust Estate, the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Parity Lien Secured Parties, the Second Priority Secured Parties may enforce rights, exercise remedies and take actions:
actions (A) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations;
, (B) subject as necessary to the perfect a Lien upon any Collateral Agent's obligation to comply with the Act by any method of Required Debtholders, to instruct the Collateral Agent to foreclose upon and otherwise enforce Second Priority Liens at any time after the Remedy Bar Lift Trigger Date;
perfection except through possession or control or (C) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(D) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Second Priority Liens upon any Collateral; or
(E) as necessary to create, prove, preserve or protect (but not enforce) the Second Priority Liens upon any Collateral.
(3) after securing the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, and further subject to the Collateral Agent's obligations to comply with the Act of Required Debtholders, the First Priority Secured Parties and the Second Priority Secured Parties will have the exclusive right to instruct the Collateral Agent to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Trust Estate or the Second Priority Trust Estate, regardless of whether such Collateral may also be part of the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties:
(A) the Third Priority Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Parity Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Third Priority Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Third Priority Liens upon any Collateral.
(B) the Other Junior Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations, the Discharge of the Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Other Junior Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Other Junior Liens upon any Collateral.
(d) In exercising rights and remedies with respect to the Collateral, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the First Priority Secured Parties and, after the Remedy Bar Lift Trigger Date, but subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, the Second Priority Secured Parties, Debt Representatives may enforce (or refrain from enforcing) the provisions of the Security Priority Lien Documents and exercise (or refrain from exercising) remedies thereunder or any such rights and remedies available at law or in equityremedies, all in such order and in such manner as they may determine in the exercise of their sole and exclusive discretion, including:
including (1i) the exercise or forbearance forebearance from exercise of all rights and remedies in respect of the Collateral and/or the applicable Liens;
Priority Lien Obligations, (2ii) the enforcement or forbearance from enforcement of any Lien in respect of the Collateral;
, (3iii) the release, with or without consideration, of the Collateral from the Senior Trust Estate, and, in connection with any such release, the concurrent release, with or without consideration (as determined by the Priority Lien Secured Parties), of such collateral from the Junior Trust Estate, (iv) the exercise or forbearance forebearance from exercise of rights and powers of a holder of shares of stock included in the Collateral Senior Trust Estate to the extent provided in the Security Documents;
, (4v) the acceptance of the Collateral in full or partial satisfaction of the applicable Obligations; and
Priority Lien Obligations and (5vi) the exercise or forbearance forebearance from exercise of all rights and remedies of a secured lender under the UCC or any similar law of any applicable jurisdiction or in equity.
(e) The parties hereto agree that:
(1) Prior Without in any way limiting the generality of the foregoing paragraphs, the Priority Lien Secured Parties may, at any time and from time to time, without the consent of or notice to the Discharge Parity Lien Secured Parties, without incurring responsibility to the Parity Lien Secured Parties and without impairing or releasing the subordination provided in this Agreement or the obligations hereunder of First the Parity Lien Secured Parties, do any one or more of the following: (i) change the manner, place or terms of payment or extend the time of payment of, or renew or alter, the Priority Lien Obligations, or otherwise amend or supplement in any manner the Second Priority Secured Parties and Lien Obligations, or any instrument evidencing the Priority Lien Obligations or any agreement under which the Priority Lien Obligations are outstanding, (ii) release any person or entity liable in any manner for the collection of the Priority Lien Obligations, (iii) release the Lien on any Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against securing the First Priority Secured Parties (in their capacity as priority lienholders), under equitable principles.
(2) Prior to the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations, the Third Priority Secured Parties and the Collateral Agent may not assert (iv) exercise or enforce refrain from exercising any right of marshalling accorded to a junior lienholders, as rights against the First Priority Secured Parties or the Second Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles.
(3) Prior to the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations, the Other Junior Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties, the Second Priority Secured Parties or the Third Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principlesObligor.
(f) Except The doctrine of marshalling of assets or collateral or any other legal or equitable principle or doctrine which could otherwise, in any way, constrain, limit or affect the order or manner of the enforcement against any person obligated for payments received free from the Priority Lien Obligations or the liquidation of the Senior Priority Liens as provided in Section 2.5(g), subject Trust Estate shall not be applicable to the Senior Trust Estate or to the rights of any holders of Permitted Prior Liens, including any Priming the Priority Lien Secured Parties, (i) all proceeds of Collateral received by any Junior Priority Debt Representative, the Collateral Agent or any holder of Junior Priority Liens at any time prior to the Discharge of Senior Priority Lien Obligations, will be held by such Junior Priority Debt Representative, the Collateral Agent or such holder, as the case may be, for the account of the holders of Senior Priority Liens and remitted to the applicable Senior Priority Debt Representative in accordance with the terms of the Senior Priority Debt Documents.
(g) Except for payments that are made from or constitute proceeds of property subject to Senior Priority Liens and that are received by any Junior Priority Debt Representative 44 or the Collateral Agent or any holder of Junior Priority Lien Obligations at any time prior to the Discharge of Senior Priority Lien Obligations and after (i) the commencement of any Insolvency Proceeding in respect of the Company or any other Obligor or (ii) any Junior Priority Debt Representative and the Collateral Agent have received written notice from any Senior Priority Debt Representative stating that (A) any Senior Priority Lien Debt has become due and payable in full (whether at maturity, upon acceleration or otherwise) or (B) the holders of Senior Priority Liens have become entitled to and desire to enforce any or all of the Priority Liens by reason of a default under any Senior Priority Debt Document:
(1) no payment of money (or the equivalent of money) made by the Company or any other Obligor to any Junior Priority Debt Representative, the Collateral Agent or any other holder of Junior Priority Lien Obligations (including, without limitation, payments and prepayments made for application to Junior Priority Lien Obligations and all other payments and deposits made pursuant to any provision of the Junior Priority Debt Document) will in any event be the subject to the foregoing provisions of this Section 2.5; and
(2) all payments permitted to be received Parties under this Section 2.5(g) will be received by the applicable Junior Priority Debt Representative, the Collateral Agent and other holders of Junior Priority Lien Obligations free from the Senior Priority Liens and all other Liens except the Junior Priority LiensAgreement.
Appears in 1 contract
Priority of Liens. (a) Notwithstanding anything else contained herein or in any other Security Document, it is the intent of the parties hereto that:
: (1i) this Agreement and the Security Documents create four two separate and distinct Trust Estates and Liens: the First Priority Senior Trust Estate and Lien securing the payment and performance of the First Priority Lien Obligations, Obligations and the Second Priority Junior Trust Estate and Lien securing the payment and performance of the Second Priority Parity Lien Obligations, the Third Priority Lien Trust Estate Obligations and Lien securing the payment and performance of the Third Priority Lien, and the Other Junior Lien Trust Estate and Lien securing the payment and performance of the Other Junior Lien Obligations;
(2) (wii) the Liens securing the First Priority Parity Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, (x) the Liens securing the Second Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations and the Liens securing the First Priority Lien Obligations, (y) the Liens securing the Third Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations and the Liens securing the Second Priority Lien Obligations and (z) the Liens securing the Other Junior Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations, the Liens securing the Second Priority Lien Obligations and the Liens securing the Third Priority Lien Obligations; and
(3) subject to the provisions of this Agreement relating to the rights to proceeds of the sale of property subject to the Liens described herein and, if applicable, the Priming Liens, any sale of property pursuant to a Lien described hereunder or, if applicable, a Priming Lien, will extinguish all Liens junior to the Lien pursuant to which such sale was made, and any property so sold will be sold free and clear of all such junior Liens.
(b) The parties hereto agree that, after the date hereof and prior to the Discharge of Priority Lien Obligations, in no event will:
(1) with respect to Collateral that is subject to a Lien in favor of any Priming Lien Secured Parties, shall the First Priority Parity Debt Representatives or any First Priority Secured Parties have a Parity Lien on or security interest in such Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties;
(2) the Second Priority Debt Representatives or any Second Priority Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming first priority lien of the Priority Lien Secured Parties. Notwithstanding (i) anything to the contrary contained in any Parity Lien Document and irrespective of the time, order or method of attachment or perfection of the security interests created by the Priority Lien Documents or the Parity Lien Documents, (ii) anything contained in any Priming filing or agreement to which the Priority Lien Secured Parties or Parity Lien Secured Parties or any other party hereto may be a party and the First Priority Lien of the First Priority Secured Parties;
(3iii) the Third Priority Debt Representatives rules for determining priority under the UCC or any Third Priority Secured Parties have a Lien on or other law governing the relative priorities of secured creditors, any security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien part of the First Priority Secured Parties Senior Trust Estate has and the Second Priority Lien of the Second Priority Secured Parties; or
(4) the Other Junior Debt Representatives or shall have priority over any Other Junior Secured Parties have a Lien on or security interest in any such Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien part of the First Priority Secured Parties, the Second Priority Lien of the Second Priority Secured Parties and the Third Priority Lien of the Third Priority Secured PartiesJunior Trust Estate.
(c) Whether or not any Bankruptcy Case or Insolvency Proceeding has been commenced by or against any Obligor:
, until the Discharge of Priority Lien Obligations, (1i) the Junior Priority Parity Lien Secured Parties will not:
not (A) request judicial reliefexercise or seek to exercise any rights or exercise any remedies with respect to any Collateral that is subject to the Senior Trust Estate, (B) institute any action or proceeding with respect to such rights or remedies with respect to any Collateral, including any action of foreclosure, (C) contest, protest or object to any foreclosure proceeding or action brought by the Priority Lien Secured Parties or any other exercise by the Priority Lien Secured Parties of any rights and remedies under any Priority Lien Documents relating to the Collateral that is subject to the Senior Trust Estate, (D) object to the forbearance by the Priority Lien Secured Parties to the bringing or pursuing of any foreclosure proceeding or action or any other exercise of any rights or remedies relating to the Collateral that is subject to the Senior Trust Estate, (E) take or receive from the Obligors, directly or indirectly, in an Insolvency Proceeding cash or other property or by set off or in any other courtmanner, that would hinder, delay, limit or prohibit the lawful exercise or enforcement of any right or remedy otherwise available to the Senior Priority Secured Parties in respect of the Collateral or that would limitany part thereof or proceeds therefrom in satisfaction of the Parity Lien Obligations, invalidate(F) contest or seek to invalidate any Liens or security interests securing the Priority Debt Obligations, avoid or set aside the perfection thereof, or the validity or enforceability of this Agreement, (G) take or permit any action prejudicial to or inconsistent with the priority position of the Senior Trust Estate over the Junior Trust Estate, (H) object to any adequate protection or similar relief requested and obtained by the Priority Lien or subordinate any Senior Priority Liens to any Junior Priority Liens or grant Junior Priority Liens equal ranking to any Senior Priority Liens;
(B) oppose or otherwise contest any motion for relief from the automatic stay or for any injunction against foreclosure or enforcement of Senior Priority Liens made by any Senior Priority Secured Parties in any Insolvency Proceedings;
Proceeding or Bankruptcy Case with respect to any Obligor or (CI) oppose object to any consent or otherwise contest any lawful exercise approval by any Senior the Priority Lien Secured Parties to the use of cash or other Collateral, or any similar relief, in any Insolvency Proceeding or Bankruptcy Case with respect to any Obligor, and (ii) the right to credit bid Senior Priority Lien Debt at any sale in foreclosure of Senior Priority Liens; or
(D) oppose or otherwise contest any other request for judicial relief made in any court by any Senior Priority Secured Party relating to the lawful enforcement of any Senior Priority Lien against the Collateral; provided, however, that notwithstanding the foregoing, both before and during an Insolvency Proceeding, the Junior Priority Secured Parties may take any actions and exercise any and all rights that would otherwise be available to a holder of unsecured claims, including, without limitation, the commencement of Insolvency Proceedings against any Obligor in accordance with applicable law; provided further, however, that the Junior Priority Secured Parties may not challenge the validity, enforceability, perfection or priority of the Senior Priority Liens; and
(2) prior to the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the First Priority Secured Parties will shall have the exclusive right to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Senior Trust Estate, regardless of whether such Collateral may also be part of the Second Priority Trust Estate, the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Parity Lien Secured Parties, the Second Priority Secured Parties may enforce rights, exercise remedies and take actions:
actions (A) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations;
, (B) subject as necessary to the perfect a Lien upon any Collateral Agent's obligation to comply with the Act by any method of Required Debtholders, to instruct the Collateral Agent to foreclose upon and otherwise enforce Second Priority Liens at any time after the Remedy Bar Lift Trigger Date;
perfection except through possession or control or (C) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(D) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Second Priority Liens upon any Collateral; or
(E) as necessary to create, prove, preserve or protect (but not enforce) the Second Priority Liens upon any Collateral.
(3) after securing the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, and further subject to the Collateral Agent's obligations to comply with the Act of Required Debtholders, the First Priority Secured Parties and the Second Priority Secured Parties will have the exclusive right to instruct the Collateral Agent to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Trust Estate or the Second Priority Trust Estate, regardless of whether such Collateral may also be part of the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties:
(A) the Third Priority Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Parity Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Third Priority Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Third Priority Liens upon any Collateral.
(B) the Other Junior Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations, the Discharge of the Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Other Junior Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Other Junior Liens upon any Collateral.
(d) In exercising rights and remedies with respect to the Collateral, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the First Priority Secured Parties and, after the Remedy Bar Lift Trigger Date, but subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, the Second Priority Secured Parties, Debt Representatives may enforce (or refrain from enforcing) the provisions of the Security Priority Lien Documents and exercise (or refrain from exercising) remedies thereunder or any such rights and remedies available at law or in equityremedies, all in such order and in such manner as they may determine in the exercise of their sole and exclusive discretion, including:
including (1i) the exercise or forbearance forebearance from exercise of all rights and remedies in respect of the Collateral and/or the applicable Liens;
Priority Lien Obligations, (2ii) the enforcement or forbearance from enforcement of any Lien in respect of the Collateral;
, (3iii) the release, with or without consideration, of the Collateral from the Senior Trust Estate, and, in connection with any such release, the concurrent release, with or without consideration (as determined by the Priority Lien Secured Parties), of such collateral from the Junior Trust Estate, (iv) the exercise or forbearance forebearance from exercise of rights and powers of a holder of shares of stock included in the Collateral Senior Trust Estate to the extent provided in the Security Documents;
, (4v) the acceptance of the Collateral in full or partial satisfaction of the applicable Obligations; and
Priority Lien Obligations and (5vi) the exercise or forbearance forebearance from exercise of all rights and remedies of a secured lender under the UCC or any similar law of any applicable jurisdiction or in equity.
(e) The parties hereto agree that:
(1) Prior Without in any way limiting the generality of the foregoing paragraphs, the Priority Lien Secured Parties may, at any time and from time to time, without the consent of or notice to the Discharge Parity Lien Secured Parties, without incurring responsibility to the Parity Lien Secured Parties and without impairing or releasing the subordination provided in this Agreement or the obligations hereunder of First the Parity Lien Secured Parties, do any one or more of the following: (i) change the manner, place or terms of payment or extend the time of payment of, or renew or alter, the Priority Lien Obligations, or otherwise amend or supplement in any manner the Second Priority Secured Parties and Lien Obligations, or any instrument evidencing the Priority Lien Obligations or any agreement under which the Priority Lien Obligations are outstanding, (ii) release any Person or entity liable in any manner for the collection of the Priority Lien Obligations, (iii) release the Lien on any Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against securing the First Priority Secured Parties (in their capacity as priority lienholders), under equitable principles.
(2) Prior to the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations, the Third Priority Secured Parties and the Collateral Agent may not assert (iv) exercise or enforce refrain from exercising any right of marshalling accorded to a junior lienholders, as rights against the First Priority Secured Parties or the Second Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles.
(3) Prior to the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations, the Other Junior Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties, the Second Priority Secured Parties or the Third Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principlesObligor.
(f) Except The doctrine of marshalling of assets or collateral or any other legal or equitable principle or doctrine which could otherwise, in any way, constrain, limit or affect the order or manner of the enforcement against any Person obligated for payments received free from the Priority Lien Obligations or the liquidation of the Senior Priority Liens as provided in Section 2.5(g), subject Trust Estate shall not be applicable to the Senior Trust Estate or to the rights of any holders of Permitted Prior Liens, including any Priming the Priority Lien Secured Parties, (i) all proceeds of Collateral received by any Junior Priority Debt Representative, the Collateral Agent or any holder of Junior Priority Liens at any time prior to the Discharge of Senior Priority Lien Obligations, will be held by such Junior Priority Debt Representative, the Collateral Agent or such holder, as the case may be, for the account of the holders of Senior Priority Liens and remitted to the applicable Senior Priority Debt Representative in accordance with the terms of the Senior Priority Debt Documents.
(g) Except for payments that are made from or constitute proceeds of property subject to Senior Priority Liens and that are received by any Junior Priority Debt Representative 44 or the Collateral Agent or any holder of Junior Priority Lien Obligations at any time prior to the Discharge of Senior Priority Lien Obligations and after (i) the commencement of any Insolvency Proceeding in respect of the Company or any other Obligor or (ii) any Junior Priority Debt Representative and the Collateral Agent have received written notice from any Senior Priority Debt Representative stating that (A) any Senior Priority Lien Debt has become due and payable in full (whether at maturity, upon acceleration or otherwise) or (B) the holders of Senior Priority Liens have become entitled to and desire to enforce any or all of the Priority Liens by reason of a default under any Senior Priority Debt Document:
(1) no payment of money (or the equivalent of money) made by the Company or any other Obligor to any Junior Priority Debt Representative, the Collateral Agent or any other holder of Junior Priority Lien Obligations (including, without limitation, payments and prepayments made for application to Junior Priority Lien Obligations and all other payments and deposits made pursuant to any provision of the Junior Priority Debt Document) will in any event be the subject to the foregoing provisions of this Section 2.5; and
(2) all payments permitted to be received Parties under this Section 2.5(g) will be received by the applicable Junior Priority Debt Representative, the Collateral Agent and other holders of Junior Priority Lien Obligations free from the Senior Priority Liens and all other Liens except the Junior Priority LiensAgreement.
Appears in 1 contract
Priority of Liens. Notwithstanding the time of incurrence of any Secured Debt, the order or method of attachment or perfection of any Liens securing any Secured Debt, the time or order of filing or recording of financing statements or other documents filed or recorded to perfect any Lien upon any Collateral, the rules for determining priority under any law governing relative priorities of Liens on the Collateral or any conflicting terms or conditions which may be contained in any of the Agreements:
(a) Notwithstanding anything else contained herein or The following Lien priorities shall strictly apply in any defining the respective Lien priorities of each Creditor in the Revolving Loan Collateral (other Security Document, it is than the intent Noteholder First Priority Real Property Collateral):
(i) first: the Liens upon such Collateral of Revolving Agent and Revolving Loan Lenders to the full extent of the parties hereto that:Revolving Loan Debt;
(1ii) this Agreement and the Security Documents create four separate and distinct Trust Estates and Lienssecond: the First Priority Trust Estate Liens upon such Collateral of Noteholder Collateral Agent, Trustee and Lien securing Noteholders to the payment and performance full extent of the First Priority Lien Obligations, Noteholder Debt; and
(iii) third: the Second Priority Trust Estate and Lien securing the payment and performance Liens upon such Collateral of the Second Priority Lien Obligations, the Third Priority Lien Trust Estate Collateral Agent and Lien securing Third Priority Noteholders to the payment and performance full extent of the Third Priority Lien, and the Other Junior Lien Trust Estate and Lien securing the payment and performance of the Other Junior Lien Obligations;
(2) (w) the Liens securing the First Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, (x) the Liens securing the Second Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations and the Liens securing the First Priority Lien Obligations, (y) the Liens securing the Third Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations and the Liens securing the Second Priority Lien Obligations and (z) the Liens securing the Other Junior Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations, the Liens securing the Second Priority Lien Obligations and the Liens securing the Third Priority Lien Obligations; and
(3) subject to the provisions of this Agreement relating to the rights to proceeds of the sale of property subject to the Liens described herein and, if applicable, the Priming Liens, any sale of property pursuant to a Lien described hereunder or, if applicable, a Priming Lien, will extinguish all Liens junior to the Lien pursuant to which such sale was made, and any property so sold will be sold free and clear of all such junior LiensDebt.
(b) The parties hereto agree that, following Lien priorities shall strictly apply in no event willdefining the respective Lien priorities of each Creditor in the Noteholder First Priority Real Property Collateral:
(1i) with respect to Collateral that is subject to a Lien in favor of any Priming Lien Secured Parties, first: the First Priority Debt Representatives or any First Priority Secured Parties have a Lien on or security interest in Liens upon such Collateral that is not subject of Noteholder Collateral Agent, Trustee and subordinate Noteholders to the Priming Lien full extent of any Priming Lien Secured Partiesthe Noteholder Debt;
(2ii) second: the Second Priority Debt Representatives or any Second Priority Secured Parties have a Lien on or security interest in any Liens upon such Collateral that is not subject of Revolving Loan Agent and subordinate Revolving Loan Lenders to the Priming Lien of any Priming Lien Secured Parties and the First Priority Lien full extent of the First Priority Secured Parties;Revolving Loan Debt; and
(3iii) third: the Liens upon such Collateral of Third Priority Debt Representatives or any Collateral Agent and Third Priority Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate Noteholders to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien of the First Priority Secured Parties and the Second Priority Lien of the Second Priority Secured Parties; or
(4) the Other Junior Debt Representatives or any Other Junior Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien of the First Priority Secured Parties, the Second Priority Lien of the Second Priority Secured Parties and the Third Priority Lien full extent of the Third Priority Secured PartiesDebt.
(c) Whether or not any Insolvency Proceeding has been commenced by or against any Obligor:
(1) the Junior Priority Secured Parties will not:
(A) request judicial relief, in an Insolvency Proceeding or in any other court, that would hinder, delay, limit or prohibit the lawful exercise or enforcement of any right or remedy otherwise available to the Senior Priority Secured Parties in respect of the Collateral or that would limit, invalidate, avoid or set aside any Senior Priority Lien or subordinate any Senior Priority Liens to any Junior Priority Liens or grant Junior Priority Liens equal ranking to any Senior Priority Liens;
(B) oppose or otherwise contest any motion for relief from the automatic stay or for any injunction against foreclosure or enforcement of Senior Priority Liens made by any Senior Priority Secured Parties in any Insolvency Proceedings;
(C) oppose or otherwise contest any lawful exercise by any Senior Priority Secured Parties of the right to credit bid Senior Priority Lien Debt at any sale in foreclosure of Senior Priority Liens; or
(D) oppose or otherwise contest any other request for judicial relief made in any court by any Senior Priority Secured Party relating to the lawful enforcement of any Senior Priority Lien against the Collateral; provided, however, that notwithstanding the foregoing, both before and during an Insolvency Proceeding, the Junior Priority Secured Parties may take any actions and exercise any and all rights that would otherwise be available to a holder of unsecured claims, including, without limitation, the commencement of Insolvency Proceedings against any Obligor in accordance with applicable law; provided further, however, that the Junior Priority Secured Parties may not challenge the validity, enforceability, perfection or priority of the Senior Priority Liens; and
(2) prior to the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the First Priority Secured Parties will have the exclusive right to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Trust Estate, regardless of whether such Collateral may also be part of the Second Priority Trust Estate, the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the Second Priority Secured Parties may enforce rights, exercise remedies and take actions:
(A) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations;
(B) subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, to instruct the Only Noteholder Collateral Agent to foreclose upon and otherwise enforce Second Priority Liens at any time after has a Lien on the Remedy Bar Lift Trigger Date;
(C) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(D) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Second Priority Liens upon any Collateral; or
(E) as necessary to create, prove, preserve or protect (but not enforce) the Second Priority Liens upon any Collateral.
(3) after the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, and further subject to the Collateral Agent's obligations to comply with the Act of Required Debtholders, the First Priority Secured Parties and the Second Priority Secured Parties will have the exclusive right to instruct the Collateral Agent to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Trust Estate or the Second Priority Trust Estate, regardless of whether such Collateral may also be part of the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties:
(A) the Third Priority Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Third Priority Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Third Priority Liens upon any Collateral.
(B) the Other Junior Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations, the Discharge of the Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Other Junior Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Other Junior Liens upon any CollateralMotor Vehicles.
(d) In exercising rights and remedies with respect Notwithstanding anything to the Collateralcontrary contained herein, subject the principal amount of the Revolving Loan Debt in excess of Revolving Loan Priority Amount shall not be entitled to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the First Priority Secured Parties and, after the Remedy Bar Lift Trigger Date, but subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, the Second Priority Secured Parties, may enforce (or refrain from enforcing) the provisions benefit of the Security Documents and exercise (or refrain from exercising) remedies thereunder or any such rights and remedies available at law or in equity, all in such order and in such manner as they may determine in the exercise of their sole and exclusive discretion, including:
(1) the exercise or forbearance from exercise of all rights and remedies in respect priority of the Collateral and/or the applicable Liens;
(2) the enforcement or forbearance from enforcement Liens of any Lien Revolving Loan Agent provided for in respect of the Collateral;
(3) the exercise or forbearance from exercise of rights and powers of a holder of shares of stock included in the Collateral to the extent provided in the Security Documents;
(4) the acceptance of the Collateral in full or partial satisfaction of the applicable Obligations; and
(5) the exercise or forbearance from exercise of all rights and remedies of a secured lender under the UCC or any similar law of any applicable jurisdiction or in equity.
(e) The parties hereto agree that:
(1) Prior to the Discharge of First Priority Lien Obligations, the Second Priority Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties (in their capacity as priority lienholders), under equitable principles.
(2) Prior to the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations, the Third Priority Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties or the Second Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles.
(3) Prior to the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations, the Other Junior Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties, the Second Priority Secured Parties or the Third Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles.
(f) Except for payments received free from the Senior Priority Liens as provided in Section 2.5(g), subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, (i) all proceeds of Collateral received by any Junior Priority Debt Representative, the Collateral Agent or any holder of Junior Priority Liens at any time prior to the Discharge of Senior Priority Lien Obligations, will be held by such Junior Priority Debt Representative, the Collateral Agent or such holder, as the case may be, for the account of the holders of Senior Priority Liens and remitted to the applicable Senior Priority Debt Representative in accordance with the terms of the Senior Priority Debt Documents.
(g) Except for payments that are made from or constitute proceeds of property subject to Senior Priority Liens and that are received by any Junior Priority Debt Representative 44 or the Collateral Agent or any holder of Junior Priority Lien Obligations at any time prior to the Discharge of Senior Priority Lien Obligations and after (i) the commencement of any Insolvency Proceeding in respect of the Company or any other Obligor or (ii) any Junior Priority Debt Representative and the Collateral Agent have received written notice from any Senior Priority Debt Representative stating that (A) any Senior Priority Lien Debt has become due and payable in full (whether at maturity, upon acceleration or otherwise) or (B) the holders of Senior Priority Liens have become entitled to and desire to enforce any or all of the Priority Liens by reason of a default under any Senior Priority Debt Document:
(1) no payment of money (or the equivalent of money) made by the Company or any other Obligor to any Junior Priority Debt Representative, the Collateral Agent or any other holder of Junior Priority Lien Obligations (including, without limitation, payments and prepayments made for application to Junior Priority Lien Obligations and all other payments and deposits made pursuant to any provision of the Junior Priority Debt Document) will in any event be the subject to the foregoing provisions of this Section 2.5; and
(2) all payments permitted to be received under this Section 2.5(g) will be received by the applicable Junior Priority Debt Representative, the Collateral Agent and other holders of Junior Priority Lien Obligations free from the Senior Priority Liens and all other Liens except the Junior Priority Liens2.2.
Appears in 1 contract
Sources: Intercreditor Agreement (Atlantic Express Transportation Corp)
Priority of Liens. (1) Subject to the terms of this Agreement, each of the Secured Parties expressly and irrevocably agrees that the Secured Parties Liens in the ABL Priority Collateral shall, as between the Secured Parties, have the following priorities:
(a) Notwithstanding anything else contained herein or in any other Security DocumentUntil the ABL Obligations Payment Date has occurred, it is (A) the intent of ABL Liens shall be first priority Liens and shall have full and absolute priority over the parties hereto that:
(1) this Agreement Term Credit Liens and the Security Documents create four separate and distinct Trust Estates and Liens: the First Priority Trust Estate and Lien securing the payment and performance of the First Priority Lien Obligations, the Second Priority Trust Estate and Lien securing the payment and performance of the Second Priority Lien Obligations, the Third Priority Lien Trust Estate and Lien securing the payment and performance of the Third Priority Lien, and the Other Junior Lien Trust Estate and Lien securing the payment and performance of the Other Junior Lien Obligations;
(2) (w) the Liens securing the First Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, (x) the Liens securing the Second Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations and the Liens securing the First Priority Lien Obligations, (y) the Liens securing the Third Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations and the Liens securing the Second Priority Lien Obligations and (z) the Liens securing the Other Junior Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations, the Liens securing the Second Priority Lien Obligations and the Liens securing the Third Priority Lien Obligations; and
(3) subject to the provisions of this Agreement relating to the rights to proceeds of the sale of property subject to the Liens described herein and, if applicable, the Priming Secured Notes Liens, any sale each of property pursuant to a Lien described hereunder or, if applicable, a Priming Lien, will extinguish which shall in all Liens respects and for all purposes be subordinated and postponed and rank junior to the Lien pursuant ABL Liens, (B) the Term Credit Liens shall be second priority Liens and shall have full and absolute priority over the Secured Notes Liens, which shall in all respects and for all purposes be subordinated and postponed and rank junior to which such sale was madethe Term Credit Liens, and any property so sold will (C) the Secured Notes Liens shall be sold free and clear of all such junior third priority Liens.;
(b) The parties hereto agree thatProvided the ABL Obligations Payment Date has occurred and until the Term Credit Obligations Payment Date has occurred, in no event will:
(1) with respect to Collateral that is subject to a Lien in favor of any Priming Lien Secured Parties, the First Priority Debt Representatives or any First Priority Secured Parties have a Lien on or security interest in such Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties;
(2) the Second Priority Debt Representatives or any Second Priority Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties and the First Priority Lien of the First Priority Secured Parties;
(3) the Third Priority Debt Representatives or any Third Priority Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien of the First Priority Secured Parties and the Second Priority Lien of the Second Priority Secured Parties; or
(4) the Other Junior Debt Representatives or any Other Junior Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien of the First Priority Secured Parties, the Second Priority Lien of the Second Priority Secured Parties and the Third Priority Lien of the Third Priority Secured Parties.
(c) Whether or not any Insolvency Proceeding has been commenced by or against any Obligor:
(1) the Junior Priority Secured Parties will not:
(A) request judicial relief, the Term Credit Liens shall be first priority Liens and shall have full and absolute priority over the Secured Notes Liens which shall in an Insolvency Proceeding or in any other court, that would hinder, delay, limit or prohibit the lawful exercise or enforcement of any right or remedy otherwise available all respects and for all purposes be subordinated and postponed and rank junior to the Senior Priority Secured Parties in respect of the Collateral or that would limitTerm Credit Liens, invalidate, avoid or set aside any Senior Priority Lien or subordinate any Senior Priority Liens to any Junior Priority Liens or grant Junior Priority Liens equal ranking to any Senior Priority Liens;
and (B) oppose or otherwise contest any motion for relief from the automatic stay or for any injunction against foreclosure or enforcement of Senior Priority Secured Notes Liens made by any Senior Priority Secured Parties in any Insolvency Proceedings;
(C) oppose or otherwise contest any lawful exercise by any Senior Priority Secured Parties of the right to credit bid Senior Priority Lien Debt at any sale in foreclosure of Senior Priority Liens; or
(D) oppose or otherwise contest any other request for judicial relief made in any court by any Senior Priority Secured Party relating to the lawful enforcement of any Senior Priority Lien against the Collateral; provided, however, that notwithstanding the foregoing, both before and during an Insolvency Proceeding, the Junior Priority Secured Parties may take any actions and exercise any and all rights that would otherwise shall be available to a holder of unsecured claims, including, without limitation, the commencement of Insolvency Proceedings against any Obligor in accordance with applicable law; provided further, however, that the Junior Priority Secured Parties may not challenge the validity, enforceability, perfection or second priority of the Senior Priority Liens; and
(c) Provided each of the ABL Obligations Payment Date and the Term Credit Obligations Payment Date has occurred, the Secured Notes Liens shall be first priority Liens and shall have full and absolute priority over the ABL Priority Collateral until the Secured Notes Obligations Payment Date has occurred.
(2) prior Subject to the Remedy Bar Lift Trigger Dateterms of this Agreement, subject to each of the rights of any holders of Permitted Prior LiensSecured Parties expressly and irrevocably agrees that the Secured Parties Liens in the Term Priority Collateral shall, including any Priming Lien as between the Secured Parties, the First Priority Secured Parties will have the exclusive right to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Trust Estate, regardless of whether such Collateral may also be part of the Second Priority Trust Estate, the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the Second Priority Secured Parties may enforce rights, exercise remedies and take actions:
(A) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations;
(B) subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, to instruct the Collateral Agent to foreclose upon and otherwise enforce Second Priority Liens at any time after the Remedy Bar Lift Trigger Date;
(C) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(D) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Second Priority Liens upon any Collateral; or
(E) as necessary to create, prove, preserve or protect (but not enforce) the Second Priority Liens upon any Collateral.
(3) after the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, and further subject to the Collateral Agent's obligations to comply with the Act of Required Debtholders, the First Priority Secured Parties and the Second Priority Secured Parties will have the exclusive right to instruct the Collateral Agent to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Trust Estate or the Second Priority Trust Estate, regardless of whether such Collateral may also be part of the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties:
(A) the Third Priority Secured Parties may enforce rights, exercise remedies and take actionsfollowing priorities:
(a) without any condition or restriction whatsoeverUntil the Term Credit Obligations Payment Date has occurred, at any time after (A) the Discharge of First Priority Lien Obligations Term Credit Liens shall be first priority Liens and shall have full and absolute priority over the ABL Liens and the Discharge Secured Notes Liens, each of Second which shall in all respects and for all purposes be subordinated and postponed and rank junior to the Term Credit Liens, (B) the ABL Liens shall be second priority Liens and shall have full and absolute priority over the Secured Notes Liens up to, the ABL Term Priority Lien ObligationsCollateral Capped Amount, and the Secured Notes Liens shall be subordinated and postponed and rank junior to the ABL Liens to such extent, and (C) the Secured Notes Liens shall be third priority Liens and shall have full and absolute priority over the ABL Liens in excess of the ABL Term Priority Collateral Capped Amount, and the ABL Liens shall be subordinated and postponed and rank junior to the Secured Notes Liens to such extent until the Secured Notes Obligations Payment Date has occurred. Thereafter the ABL Liens in excess of the ABL Term Priority Collateral Capped Amount shall be first priority Liens;
(b) as necessary to redeem Provided the Term Credit Obligations Payment Date has occurred and until the ABL Obligations Payment Date has occurred, (subject A) the ABL Liens shall be first priority Liens and shall have full and absolute priority over the Secured Notes Liens up to the prior Discharge ABL Term Priority Collateral Capped Amount, and the Secured Notes Liens shall be subordinated and postponed and rank junior to the ABL Liens to such extent, (B) the Secured Notes Liens shall be second priority Liens and shall have full and absolute priority over the ABL Liens in excess of First the ABL Term Priority Lien Collateral Capped Amount, and the ABL Liens shall be subordinated and postponed and rank junior to the Secured Notes Liens to such extent until the Secured Notes Obligations and Discharge Payment Date has occurred. Thereafter the ABL Liens in excess of Second the ABL Term Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;Capped Amount shall be first priority Liens; and
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) Provided each of the Third Priority Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Third Priority Liens upon any Collateral.
(B) the Other Junior Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations, the Discharge of the Second Priority Lien Term Credit Obligations Payment Date and the Discharge earlier to occur of Third Priority Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Other Junior Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Other Junior Liens upon any Collateral.
(d) In exercising rights and remedies with respect to the Collateral, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the First Priority Secured Parties and, after the Remedy Bar Lift Trigger Date, but subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, the Second Priority Secured Parties, may enforce (or refrain from enforcing) the provisions of the Security Documents and exercise (or refrain from exercising) remedies thereunder or any such rights and remedies available at law or in equity, all in such order and in such manner as they may determine in the exercise of their sole and exclusive discretion, including:
(1) the exercise or forbearance from exercise of all rights and remedies in respect of the Collateral and/or the applicable Liens;
(2) the enforcement or forbearance from enforcement of any Lien in respect of the Collateral;
(3) the exercise or forbearance from exercise of rights and powers of a holder of shares of stock included in the Collateral to the extent provided in the Security Documents;
(4) the acceptance of the Collateral in full or partial satisfaction of the applicable Obligations; and
(5) the exercise or forbearance from exercise of all rights and remedies of a secured lender under the UCC or any similar law of any applicable jurisdiction or in equity.
(e) The parties hereto agree that:
(1) Prior to the Discharge of First Priority Lien Obligations, the Second Priority Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties (in their capacity as priority lienholders), under equitable principles.
(2) Prior to the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations, the Third Priority Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties or the Second Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles.
(3) Prior to the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations, the Other Junior Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties, the Second Priority Secured Parties or the Third Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles.
(f) Except for payments received free from the Senior Priority Liens as provided in Section 2.5(g), subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, (i) all proceeds of Collateral received by any Junior Priority Debt Representative, the Collateral Agent or any holder of Junior Priority Liens at any time prior to the Discharge of Senior Priority Lien Obligations, will be held by such Junior Priority Debt Representative, the Collateral Agent or such holder, as the case may be, for the account of the holders of Senior Priority Liens and remitted to the applicable Senior Priority Debt Representative in accordance with the terms of the Senior Priority Debt Documents.
(g) Except for payments that are made from or constitute proceeds of property subject to Senior Priority Liens and that are received by any Junior Priority Debt Representative 44 or the Collateral Agent or any holder of Junior Priority Lien Obligations at any time prior to the Discharge of Senior Priority Lien Obligations and after (i) the commencement of any Insolvency Proceeding in respect of the Company or any other Obligor or (ii) any Junior Priority Debt Representative and the Collateral Agent have received written notice from any Senior Priority Debt Representative stating that (A) any Senior Priority Lien Debt ABL Obligations Payment Date has become due and payable in full (whether at maturity, upon acceleration or otherwise) or (B) the holders of Senior Priority Liens have become entitled to and desire to enforce any or all of the Priority Liens by reason of a default under any Senior Priority Debt Document:
(1) no payment of money (or the equivalent of money) made by the Company or any other Obligor to any Junior Priority Debt Representative, the Collateral Agent or any other holder of Junior Priority Lien Obligations (including, without limitation, payments and prepayments made for application to Junior Priority Lien Obligations and all other payments and deposits made pursuant to any provision of the Junior Priority Debt Document) will in any event be the subject to the foregoing provisions of this Section 2.5; and
(2) all payments permitted to be received under this Section 2.5(g) will be received by the applicable Junior Priority Debt Representative, the Collateral Agent and other holders of Junior Priority Lien Obligations free from the Senior Priority Liens and all other Liens except the Junior Priority Liens.occurred or
Appears in 1 contract
Sources: Inter Creditor Agreement
Priority of Liens. (a) Notwithstanding anything else contained herein or in any other Security Document, and notwithstanding the date, time, method, manner or order of grant, attachment or perfection of any Liens securing the Parity Lien Obligations granted on the Collateral or of any Liens securing the Priority Lien Obligations granted on the Collateral and notwithstanding any provision of the UCC, the time of incurrence of any Series of Priority Lien Debt or Series of Parity Lien Debt or the time of incurrence of any other Priority Lien Obligation or Parity Lien Obligation or any other applicable law or any defect or deficiencies in, or failure to perfect or lapse in perfection of, or avoidance as a fraudulent conveyance or otherwise of, the Liens securing the Priority Lien Obligations, the subordination of such Liens to any other Liens, or any other circumstance whatsoever, whether or not any Insolvency or Liquidation Proceeding has been commenced against the Borrower or any Guarantor, it is the intent of the parties that, and the parties hereto agree for themselves and the Parity Lien Secured Parties and Priority Lien Secured Parties represented by them that:
(1) this Agreement and the other Security Documents create four two separate and distinct Trust Estates and Liens: the First Priority Senior Trust Estate and Priority Lien securing the payment and performance of the First Priority Lien Obligations, Obligations and the Second Priority Junior Trust Estate and Parity Lien securing the payment and performance of the Second Priority Lien Obligations, the Third Priority Lien Trust Estate and Lien securing the payment and performance of the Third Priority Lien, and the Other Junior Lien Trust Estate and Lien securing the payment and performance of the Other Junior Lien Obligations;
(2) (w) the Liens securing the First Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, (x) the Liens securing the Second Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations and the Liens securing the First Priority Lien Obligations, (y) the Liens securing the Third Priority Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations and the Liens securing the Second Priority Lien Obligations and (z) the Liens securing the Other Junior Lien Obligations are subject and subordinate to the Liens securing the Priming Lien Obligations, the Liens securing the First Priority Lien Obligations, the Liens securing the Second Priority Lien Obligations and the Liens securing the Third Priority Parity Lien Obligations; and
(32) subject to any Liens on Collateral securing the provisions of this Agreement relating to Parity Lien Obligations now or hereafter held by the rights to proceeds Collateral Trustee for the benefit of the sale of property subject to the Liens described herein and, if applicable, the Priming Liens, Parity Lien Secured Parties or held by any sale of property pursuant to a Parity Lien described hereunder or, if applicable, a Priming Lien, will extinguish all Liens junior to the Lien pursuant to which such sale was made, and any property so sold will be sold free and clear of all such junior Liens.
(b) The parties hereto agree thatSecured Party, in no event will:
(1) with respect to Collateral that is subject to a Lien in favor each case, whether by grant, possession, statute, operation of any Priming Lien Secured Partieslaw, the First Priority Debt Representatives subrogation or any First Priority Secured Parties have a Lien on or security interest in such Collateral that is not otherwise, are subject and subordinate to any Liens on Collateral securing the Priming Priority Lien Obligations. For the avoidance of doubt, in the event that any Priming Parity Lien Secured Parties;
(2) the Second Priority Debt Representatives or any Second Priority Secured Parties have Party becomes a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien judgment lien creditor as a result of any Priming Lien Secured Parties and the First Priority Lien of the First Priority Secured Parties;
(3) the Third Priority Debt Representatives or any Third Priority Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien of the First Priority Secured Parties and the Second Priority Lien of the Second Priority Secured Parties; or
(4) the Other Junior Debt Representatives or any Other Junior Secured Parties have a Lien on or security interest in any Collateral that is not subject and subordinate to the Priming Lien of any Priming Lien Secured Parties, the First Priority Lien of the First Priority Secured Parties, the Second Priority Lien of the Second Priority Secured Parties and the Third Priority Lien of the Third Priority Secured Parties.
(c) Whether or not any Insolvency Proceeding has been commenced by or against any Obligor:
(1) the Junior Priority Secured Parties will not:
(A) request judicial relief, in an Insolvency Proceeding or in any other court, that would hinder, delay, limit or prohibit the lawful exercise or its enforcement of any right or remedy otherwise available to the Senior Priority Secured Parties in respect of the Collateral or that would limitits rights as an unsecured creditor, invalidate, avoid or set aside any Senior Priority Lien or subordinate any Senior Priority Liens to any Junior Priority Liens or grant Junior Priority Liens equal ranking to any Senior Priority Liens;
(B) oppose or otherwise contest any motion for relief from the automatic stay or for any injunction against foreclosure or enforcement of Senior Priority Liens made by any Senior Priority Secured Parties in any Insolvency Proceedings;
(C) oppose or otherwise contest any lawful exercise by any Senior Priority Secured Parties of the right to credit bid Senior Priority Lien Debt at any sale in foreclosure of Senior Priority Liens; or
(D) oppose or otherwise contest any other request for judicial relief made in any court by any Senior Priority Secured Party relating to the lawful enforcement of any Senior Priority Lien against the Collateral; provided, however, that notwithstanding the foregoing, both before and during an Insolvency Proceeding, the Junior Priority Secured Parties may take any actions and exercise any and all rights that would otherwise such judgment lien shall be available to a holder of unsecured claims, including, without limitation, the commencement of Insolvency Proceedings against any Obligor in accordance with applicable law; provided further, however, that the Junior Priority Secured Parties may not challenge the validity, enforceability, perfection or priority of the Senior Priority Liens; and
(2) prior to the Remedy Bar Lift Trigger Date, subject to the rights terms of any holders of Permitted Prior Liens, this Agreement for all purposes hereof (including any Priming Lien Secured Parties, the First Priority Secured Parties will have the exclusive right to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Trust Estate, regardless of whether such Collateral may also be part of the Second Priority Trust Estate, the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the Second Priority Secured Parties may enforce rights, exercise remedies and take actions:
(A) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations;
(B) subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, to instruct the Collateral Agent to foreclose upon and otherwise enforce Second Priority Liens at any time after the Remedy Bar Lift Trigger Date;
(C) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(D) as necessary to perfect or establish the priority (subject to Senior Priority of Liens) of the Second Priority Liens upon any Collateral; or
(E) as necessary to create, prove, preserve or protect (but not enforce) the Second Priority Liens upon any Collateral).
(3) after the Remedy Bar Lift Trigger Date, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, and further subject to the Collateral Agent's obligations to comply with the Act of Required Debtholders, the First Priority Secured Parties and the Second Priority Secured Parties will have the exclusive right to instruct the Collateral Agent to enforce rights and exercise remedies with respect to any Collateral that is part of the First Priority Trust Estate or the Second Priority Trust Estate, regardless of whether such Collateral may also be part of the Third Priority Trust Estate or the Other Junior Lien Trust Estate. Notwithstanding the foregoing, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties:
(A) the Third Priority Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations and Discharge of Second Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Third Priority Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Third Priority Liens upon any Collateral.
(B) the Other Junior Secured Parties may enforce rights, exercise remedies and take actions:
(a) without any condition or restriction whatsoever, at any time after the Discharge of First Priority Lien Obligations, the Discharge of the Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations;
(b) as necessary to redeem (subject to the prior Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations) any Collateral in a creditor's redemption permitted by law or to deliver any notice or demand necessary to enforce any right to claim, take or receive proceeds of Collateral remaining after the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations in the event of foreclosure or other enforcement of any prior Lien;
(c) as necessary to perfect or establish the priority (subject to Senior Priority Liens) of the Other Junior Liens upon any Collateral; or
(d) as necessary to create, prove, preserve or protect (but not enforce) the Other Junior Liens upon any Collateral.
(d) In exercising rights and remedies with respect to the Collateral, subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, the First Priority Secured Parties and, after the Remedy Bar Lift Trigger Date, but subject to the Collateral Agent's obligation to comply with the Act of Required Debtholders, the Second Priority Secured Parties, may enforce (or refrain from enforcing) the provisions of the Security Documents and exercise (or refrain from exercising) remedies thereunder or any such rights and remedies available at law or in equity, all in such order and in such manner as they may determine in the exercise of their sole and exclusive discretion, including:
(1) the exercise or forbearance from exercise of all rights and remedies in respect of the Collateral and/or the applicable Liens;
(2) the enforcement or forbearance from enforcement of any Lien in respect of the Collateral;
(3) the exercise or forbearance from exercise of rights and powers of a holder of shares of stock included in the Collateral to the extent provided in the Security Documents;
(4) the acceptance of the Collateral in full or partial satisfaction of the applicable Obligations; and
(5) the exercise or forbearance from exercise of all rights and remedies of a secured lender under the UCC or any similar law of any applicable jurisdiction or in equity.
(e) The parties hereto agree that:
(1) Prior to the Discharge of First Priority Lien Obligations, the Second Priority Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties (in their capacity as priority lienholders), under equitable principles.
(2) Prior to the Discharge of First Priority Lien Obligations and the Discharge of Second Priority Lien Obligations, the Third Priority Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties or the Second Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles.
(3) Prior to the Discharge of First Priority Lien Obligations, the Discharge of Second Priority Lien Obligations and the Discharge of Third Priority Lien Obligations, the Other Junior Secured Parties and the Collateral Agent may not assert or enforce any right of marshalling accorded to a junior lienholders, as against the First Priority Secured Parties, the Second Priority Secured Parties or the Third Priority Secured Parties (each, in their capacity as priority lienholders), under equitable principles.
(f) Except for payments received free from the Senior Priority Liens as provided in Section 2.5(g), subject to the rights of any holders of Permitted Prior Liens, including any Priming Lien Secured Parties, (i) all proceeds of Collateral received by any Junior Priority Debt Representative, the Collateral Agent or any holder of Junior Priority Liens at any time prior to the Discharge of Senior Priority Lien Obligations, will be held by such Junior Priority Debt Representative, the Collateral Agent or such holder, as the case may be, for the account of the holders of Senior Priority Liens and remitted to the applicable Senior Priority Debt Representative in accordance with the terms of the Senior Priority Debt Documents.
(g) Except for payments that are made from or constitute proceeds of property subject to Senior Priority Liens and that are received by any Junior Priority Debt Representative 44 or the Collateral Agent or any holder of Junior Priority Lien Obligations at any time prior to the Discharge of Senior Priority Lien Obligations and after (i) the commencement of any Insolvency Proceeding in respect of the Company or any other Obligor or (ii) any Junior Priority Debt Representative and the Collateral Agent have received written notice from any Senior Priority Debt Representative stating that (A) any Senior Priority Lien Debt has become due and payable in full (whether at maturity, upon acceleration or otherwise) or (B) the holders of Senior Priority Liens have become entitled to and desire to enforce any or all of the Priority Liens by reason of a default under any Senior Priority Debt Document:
(1) no payment of money (or the equivalent of money) made by the Company or any other Obligor to any Junior Priority Debt Representative, the Collateral Agent or any other holder of Junior Priority Lien Obligations (including, without limitation, payments and prepayments made for application to Junior Priority Lien Obligations and all other payments and deposits made pursuant to any provision of the Junior Priority Debt Document) will in any event be the subject to the foregoing provisions of this Section 2.5; and
(2) all payments permitted to be received under this Section 2.5(g) will be received by the applicable Junior Priority Debt Representative, the Collateral Agent and other holders of Junior Priority Lien Obligations free from the Senior Priority Liens and all other Liens except the Junior Priority Liens.
Appears in 1 contract
Sources: Collateral Trust Agreement