SUBORDINATION OF NOTES. 4.1 The Company, for itself, its successors and assigns, covenants and agrees, and each holder of Notes by its acceptance thereof likewise covenants and agrees, that the payment of the principal of and interest on each and all of the Notes shall be subordinate and subject, to the extent and in the manner hereinafter set forth, in right of payment to the prior payment in full of all Senior Indebtedness. 4.2 Upon any distribution of assets of the Company upon any dissolution, winding up, liquidation or reorganization of the Company, whether in bankruptcy, insolvency or receivership proceedings or upon an assignment for the benefit of creditors or any other dissolution, winding up, liquidation or reorganization of the Company: (1) Any Senior Indebtedness shall first be paid in full, or provision made for such payment in full of the principal thereof, and premium, if any, and interest thereon, before any payment is made on account of the principal of, or interest on, the Notes; (2) Any payment or distribution of assets of the company of any kind or character, whether in cash, property or securities (other than stock of the Company as reorganized or readjusted or securities of the Company or any other corporation provided for by a plan of reorganization or readjustment the payment of which is subordinate, at least to the extent provided in this Section 4 with respect to the Notes, to the payment of all Senior Indebtedness at the time outstanding and to any securities issued in respect thereof under any such plan or reorganization or readjustment), to which the holders of the Notes would be entitled except for the provisions of this Section 4 shall be paid by the liquidating trustee or agent or other person making such payment or distribution, whether a trustee in bankruptcy, a receiver or liquidating trustee or other trustee or agent, directly to the holders of senior Indebtedness or their representative or representatives or to the trustee or trustees under any indenture under which any instruments evidencing any of such Senior Indebtedness may have been issued, ratably according to the aggregate amounts remaining unpaid on account of the principal of, and premium, if any, and interest on, the Senior Indebtedness held or represented by each, to the extent necessary to make payment in full of all Senior Indebtedness remaining unpaid, after giving effect to any concurrent payment or distribution, or provision therefor, to the holders of such Senior Indebtedness; and (3) In the event that, notwithstanding the foregoing, any payment or distribution of assets of the Company of any kind or character, whether in cash, property or securities (other than stock of the Company as reorganized or readjusted or securities of the Company or any other corporation provided for by a plan of reorganization or readjustment the payment of which is subordinate, at least to the extent provided in this Section 4 with respect to the Notes, to the payment of all Senior Indebtedness at the time outstanding and to any securities issued in respect thereof under any such plan of reorganization or readjustment), shall be received by the holders of the Notes before all Senior Indebtedness is paid in full, or provision made for its payment, such payment or distribution shall be paid over to the holders of Senior Indebtedness remaining unpaid or unprovided for or their representative or representatives or to the trustee or trustees under any indenture under which any instruments evidencing any of such Senior Indebtedness may have been issued, as provided in the foregoing paragraph (2), for application to the payment of such Senior Indebtedness until all such Senior Indebtedness shall have been paid in full, after giving effect to any concurrent payment or distribution, or provision therefor, to the holders of such Senior Indebtedness. 4.3 Subject to the payment in full of all Senior Indebtedness, the holders of the Notes shall be subrogated to the rights of the holders of Senior Indebtedness to receive payments or distributions of cash, property or securities of the Company applicable to the Senior Indebtedness until the principal of and interest on the Notes shall be paid in full, and no such payments or distributions in respect of the Notes of cash, property or securities distributable to the Senior Indebtedness under the provisions hereof shall, as between the Company, its creditors other than the holders of senior Indebtedness, and the Holders of the Notes, be deemed to be a payment by the Company to or on account of Notes. It is understood that the provisions of this Section 4 are and are intended solely for the purposes of defining the relative rights of the holders of the Notes, on the one hand, and the holders of the Senior Indebtedness, on the other hand. Nothing contained in this Section 4 is intended to or shall impair, as between the Company, its creditors other than the holders of Senior Indebtedness, and the holders of the Notes, the absolute and unconditional obligation of the Company to pay to the holders of the Notes the principal of and interest on the Notes as and when the same shall become due and payable in accordance with their terms, or is intended to or shall affect the relative rights of the holders of the Notes and creditors of the Company other than the holders of the Senior Indebtedness; nor shall anything herein or therein prevent the holder of any Note from exercising all remedies otherwise permitted by applicable law upon default under the Notes, subject to the rights, if any, under this Section 4 of the holders of Senior Indebtedness in respect of cash, property or securities of the Company received upon the exercise of any such remedy. 4.4 Upon any distribution of assets of the Company referred to in this Section 4, the holders of the Notes shall be entitled to rely upon a certificate of the liquidating trustee or agent or other person making any distribution to such holders for the purpose of ascertaining the persons entitled to participate in such distribution, the holders of the Senior Indebtedness and other indebtedness of the Company, the amount thereof or payable thereon and all other fact pertinent thereto or to this Section 4. 4.5 If there shall have occurred a default in the payment of the principal of (or premium, if any) or interest on any Senior Indebtedness, then, unless and until such default shall have been cured or waived, or payment of principal or interest shall be made by the Company on the Notes, and no holder of Notes shall be entitled to receive any such payment. Nothing contained in this Section 4 shall, however (1) affect the obligation of the Company to make, or prevent the Company from making, at any time, except during the pendency of any dissolution, winding up, liquidation or reorganization proceedings or except as provided in the first sentence of this Section 4.5, payments of principal of or interest on the Notes, or (2) prevent the application by any paying agent of any moneys deposited with it by the Company to the payment of or on account of the principal of, or interest on, the Notes, if, at the time of such deposit, the paying agent did not have written notice of any event prohibiting the making of such payment or deposit by the Company, or (3) be construed as preventing the occurrence of any Event of Default hereunder. 4.6 No right of any present or future holder of any Senior Indebtedness of the Company to enforce subordination as herein provided shall at any time or in any way be prejudiced or impaired by any act or failure to act on the part of the Company or by any act or failure to act, in good faith, by any such holder, or by any noncompliance by the Company with the terms, provisions and covenants of this Note, regardless of any knowledge thereof any such holder may have or be otherwise charged with. 4.7 Any renewal or extension of the time of payment of any Senior Indebtedness or the exercise by the holders of Senior Indebtedness of any of their rights under the Senior Indebtedness, including without limitation the waiver of default thereunder or the release of any security therefor, may be made or done all without notice to or assent from the holders of the Notes. No compromise, alteration, amendment, modification, extension, renewal or other change of, or waiver, consent or other action in respect of, any liability or obligations under or in respect of, or of any of the terms, covenants or conditions of any indenture or other instrument under which any Senior Indebtedness is outstanding or of such Senior Indebtedness, and no release of property securing any Senior Indebtedness, whether or not such release is in accordance with the provisions of any applicable documents, shall in any way alter or affect any of the provisions of this Section 4.
Appears in 2 contracts
Sources: Asset Purchase Agreement (Morton Industrial Group Inc), Asset Purchase Agreement (Morton Industrial Group Inc)
SUBORDINATION OF NOTES. 4.1 (a) The Company, for itself, its successors and assigns, covenants and agrees, and each holder of Notes by its acceptance thereof likewise covenants and agrees, that the payment of the principal of and interest on each and all of the Notes shall be subordinate and subjectNote is hereby expressly subordinated, to the extent and in the manner hereinafter in this Article 19 set forth, in to the right of payment to of the prior payment of Senior Debt in full full. Attached as SCHEDULE 19(A) is a list of all Company indebtedness and a delineation as to which of such debt is Senior IndebtednessDebt.
4.2 (b) Upon any distribution of the Company's assets of the Company upon any its dissolution, winding up, liquidation liquidation, or reorganization of the Companyreorganization, whether in bankruptcy, insolvency insolvency, reorganization or receivership proceedings proceedings, or upon an assignment for the benefit of creditors or any other dissolution, winding up, liquidation or reorganization marshalling of the Company's assets and liabilities or otherwise:
(1) Any All principal, premium, if any, and interest due upon all Senior Indebtedness Debt shall first be paid in full, or provision made payment thereof provided for such payment in full money or money's worth, before the holders of the Notes are entitled to receive any payment upon the principal thereofof, and premium, if any, and interest thereon, before any payment is made on account of the principal of, or interest on, on the Notes;
(2) Any payment or distribution of the Company's assets of the company of any kind or character, whether in cash, property or securities (other than stock shares of the Company Company's stock as reorganized or readjusted or securities of the Company or any other corporation provided for by a plan of reorganization or readjustment readjustment, the payment of which is subordinate, at least to the extent provided in this Section 4 with respect to the Notes, subordinated to the payment of all Senior Indebtedness Debt which may at the time be outstanding and on terms not less favorable to any securities issued in respect the holders thereof under any such plan or reorganization or readjustment), than those of this Article 19) to which the holders of the Notes would be entitled except for the provisions of this Section 4 Article 19 shall be paid by the liquidating trustee or agent or other person making such payment or distribution, whether a trustee in bankruptcy, a receiver or liquidating trustee or other trustee or agentotherwise, directly to the holders of senior Indebtedness or their representative or representatives or Senior Debt (pro rata to each such holder on the trustee or trustees under any indenture under which any instruments evidencing any of such Senior Indebtedness may have been issued, ratably according to the aggregate amounts remaining unpaid on account basis of the principal of, and premium, if any, and interest on, the respective amounts of Senior Indebtedness Debt held or represented by eacheach such holder), to the extent necessary to make payment pay in full of all Senior Indebtedness Debt remaining unpaid, after giving effect to any prior or concurrent payment or distribution, or provision therefor, to the holders of such Senior Indebtedness; andDebt on the Senior Debt;
(3) In the event thatIf, notwithstanding the foregoing, any payment or distribution of the Company's assets of the Company of any kind or character, whether in cash, property property, or securities (other than stock shares of the Company Company's stock as reorganized or readjusted or securities of the Company or any other corporation provided for by a plan of reorganization or readjustment readjustment, the payment of which is subordinate, at least to the extent provided in this Section 4 with respect to the Notes, subordinated to the payment of all Senior Indebtedness Debt which may at the time be outstanding and on terms not less favorable to any securities issued in respect the holders thereof under any such plan than those of reorganization or readjustment), shall be this Article 19) is received by the holders of the Notes before all Senior Indebtedness Debt is paid in full, or provision made for its payment, such payment or distribution shall be paid over to the holders of Senior Indebtedness remaining unpaid or unprovided for or their representative or representatives or Debt (pro rata to each such holder on the trustee or trustees under any indenture under which any instruments evidencing any basis of the respective amounts of Senior Debt held by such Senior Indebtedness may have been issued, as provided in the foregoing paragraph (2holder), for application to the payment of such all Senior Indebtedness Debt remaining unpaid until all such Senior Indebtedness shall have Debt has been paid in full, or provision made for its payment, after giving effect to any prior or concurrent payment or distribution, or provision therefor, distribution to the holders of such the Senior IndebtednessDebt on the Senior Debt; and
(4) Each holder of the Notes agrees, in the event of any proceeding described in this paragraph (b) of this Article 19, to proceed promptly and with due diligence to enforce its claim, or to notify the Company and the other holders of the Notes in writing of its intention not to so enforce its claim, as a holder of the Notes against the Company.
4.3 (c) In the event and during the continuance of any default by the Company in the payment of any Senior Debt when due (whether at a stated maturity date, upon acceleration or otherwise), no payment of principal of, premium, if any, or interest on the Notes shall be made by the Company.
(d) Subject to the payment in full of all Senior IndebtednessDebt, the holders of the Notes shall be subrogated to the rights of the holders of the Senior Indebtedness Debt to receive payments or distributions of cash, property or securities of the Company Company's assets applicable to the Senior Indebtedness Debt until the principal of of, premium, if any, and interest on the Notes shall be is paid in full, and no . No such payments or distributions in respect of the Notes of cash, property or securities distributable applicable to the Senior Indebtedness under the provisions hereof Debt shall, as between the Company, its creditors other than the holders of senior Indebtedness, and the Holders of the Notes, be deemed to be a payment by the Company to or on account of Notes. It is understood that the provisions of this Section 4 are and are intended solely for the purposes of defining the relative rights of the holders of the Notes, on the one hand, and the holders of the Senior Indebtedness, on the other hand. Nothing contained in this Section 4 is intended to or shall impair, as between the Company, its creditors other than the holders of Senior Indebtedness, and the holders of the Notes, the absolute and unconditional obligation of the Company to pay to the holders of the Notes the principal of and interest on the Notes as and when the same shall become due and payable in accordance with their terms, or is intended to or shall affect the relative rights of the holders of the Notes and creditors of the Company other than the holders of the Senior Indebtedness; nor shall anything herein or therein prevent the holder of any Note from exercising all remedies otherwise permitted by applicable law upon default under the Notes, subject to the rights, if any, under this Section 4 of the holders of Senior Indebtedness in respect of cash, property or securities of the Company received upon the exercise of any such remedy.
4.4 Upon any distribution of assets of the Company referred to in this Section 4, the holders of the Notes shall be entitled to rely upon a certificate of the liquidating trustee or agent or other person making any distribution to such holders for the purpose of ascertaining the persons entitled to participate in such distribution, the holders of the Senior Indebtedness and other indebtedness of the Company, the amount thereof or payable thereon and all other fact pertinent thereto or to this Section 4.
4.5 If there shall have occurred a default in the payment of the principal of (or premium, if any) or interest on any Senior Indebtedness, then, unless and until such default shall have been cured or waived, or payment of principal or interest shall be made by the Company on the Notes, and no holder of Notes shall be entitled to receive any such payment. Nothing contained in this Section 4 shall, however (1) affect the obligation of the Company to make, or prevent the Company from making, at any time, except during the pendency of any dissolution, winding up, liquidation or reorganization proceedings or except as provided in the first sentence of this Section 4.5, payments of principal of or interest on the Notes, or (2) prevent the application by any paying agent of any moneys deposited with it by the Company to the payment of or on account of the principal of, or interest on, the Notes, if, at the time of such deposit, the paying agent did not have written notice of any event prohibiting the making of such payment or deposit by the Company, or (3) be construed as preventing the occurrence of any Event of Default hereunder.
4.6 No right of any present or future holder of any Senior Indebtedness of the Company to enforce subordination as herein provided shall at any time or in any way be prejudiced or impaired by any act or failure to act on the part of the Company or by any act or failure to act, in good faith, by any such holder, or by any noncompliance by the Company with the terms, provisions and covenants of this Note, regardless of any knowledge thereof any such holder may have or be otherwise charged with.
4.7 Any renewal or extension of the time of payment of any Senior Indebtedness or the exercise by the holders of Senior Indebtedness of any of their rights under the Senior Indebtedness, including without limitation the waiver of default thereunder or the release of any security therefor, may be made or done all without notice to or assent from the holders of the Notes. No compromise, alteration, amendment, modification, extension, renewal or other change of, or waiver, consent or other action in respect of, any liability or obligations under or in respect of, or of any of the terms, covenants or conditions of any indenture or other instrument under which any Senior Indebtedness is outstanding or of such Senior Indebtedness, and no release of property securing any Senior Indebtedness, whether or not such release is in accordance with the provisions of any applicable documents, shall in any way alter or affect any of the provisions of this Section 4.as
Appears in 1 contract
SUBORDINATION OF NOTES. 4.1 7.1 The Company, for itself, its successors and assigns, covenants and agrees, and each holder of Notes by its acceptance thereof likewise covenants and agrees, that the payment claims of the principal Trustee, the Holders and the Couponholders against the Issuer in respect of Subordinated Notes and interest on each and all any relative Coupons shall, in the event of the Notes shall winding up of the Issuer, be subordinate subordinated to the claims of all Senior Creditors and subject, to the extent and required under the Capital Regulations as in effect on the Issue Date of such Subordinated Notes, but will rank, in the manner hereinafter set forth, in right of payment to the prior payment in full of all Senior Indebtedness.
4.2 Upon any distribution of assets event of the Company upon any dissolution, winding up, liquidation or reorganization winding-up of the CompanyIssuer, whether in bankruptcy, insolvency or receivership proceedings or upon an assignment for (subject as aforesaid and to such exception as are from time to time applicable under the benefit of creditors or any other dissolution, winding up, liquidation or reorganization laws of the CompanyUnited Kingdom)
(i) at least pari passu with:
(1A) Any Senior Indebtedness shall first be paid in fullthe Legacy Tier 2 Notes; and
(B) all other obligations, or provision made for such payment in full present and future, of the principal thereofIssuer which constitute or would but for any applicable limitation on the amount of such capital, and premium, if any, and interest thereon, before any payment is made on account of constitute Subordinated Tier 2 Capital: and
(ii) in priority to:
(A) the principal of, or interest on, the Legacy Tier 1 Notes;
(2B) Any payment or distribution of assets all other obligations of the company of Issuer which constitute or would, but for any kind or character, whether in cash, property or securities (other than stock of applicable limitation on the Company as reorganized or readjusted or securities of the Company or any other corporation provided for by a plan of reorganization or readjustment the payment of which is subordinate, at least to the extent provided in this Section 4 with respect to the Notes, to the payment of all Senior Indebtedness at the time outstanding and to any securities issued in respect thereof under any such plan or reorganization or readjustment), to which the holders of the Notes would be entitled except for the provisions of this Section 4 shall be paid by the liquidating trustee or agent or other person making such payment or distribution, whether a trustee in bankruptcy, a receiver or liquidating trustee or other trustee or agent, directly to the holders of senior Indebtedness or their representative or representatives or to the trustee or trustees under any indenture under which any instruments evidencing any amount of such Senior Indebtedness may have been issued, ratably according to the aggregate amounts remaining unpaid on account of the principal of, and premium, if any, and interest on, the Senior Indebtedness held or represented by each, to the extent necessary to make payment in full of all Senior Indebtedness remaining unpaid, after giving effect to any concurrent payment or distribution, or provision therefor, to the holders of such Senior Indebtednesscapital constitute Tier 1 Capital; and
(3C) In the event that, notwithstanding claims of holders of all classes of share capital of the foregoing, Issuer.
7.2 Any amount in respect of the Subordinated Notes and any relative Coupons paid to the Trustee pari passu with the amounts payable to other creditors of the Issuer in the winding-up shall be held by the Trustee upon trust:
(a) FIRST for application in payment or distribution satisfaction of assets all amounts then due and unpaid under Clauses 15 and/or 16(j) to the Trustee and/or any Appointee;
(b) SECONDLY for payment of the Company claims of any kind or character, whether in cash, property or securities (other than stock of the Company as reorganized or readjusted or securities of the Company or any other corporation provided for by a plan of reorganization or readjustment the payment of which is subordinate, at least all Senior Creditors to the extent provided that such claims are admitted to proof in this Section 4 with the winding-up of the Issuer (not having been satisfied out of the other resources of the Issuer) excluding interest accruing after commencement of the winding up;
(c) THIRDLY as of the balance (if any) in or towards payment pari passu and rateably of all moneys due in respect of Legacy Tier 2 Notes and Subordinated Notes and Coupons; and
(d) FOURTHLY as of the balance (if any) to the liquidator for the time being of the Issuer, PROVIDED that (subject to the provisions of paragraph 7.6 below), only if the Solvency Condition is specified as being applicable in the Final Terms, all payments under or arising from any Notes, the Coupons or these presents relating to them or arising therefrom, other than payments to the payment of all Senior Indebtedness Trustee made in accordance with these presents in respect of, inter alia, the Trustee's fees, and remuneration and expenses and liabilities incurred by the Trustee in carrying out its duties under these presents, shall be conditional upon the Issuer satisfying the Solvency Condition both at the time outstanding of, and to any securities issued in respect thereof under immediately after, any such plan payment. The Issuer will not make any payment and any such payment shall not be payable under or arising from such Notes, the Coupons or these presents relating to them or arising therefrom unless the Issuer satisfies the Solvency Condition both at the time of, and immediately after, any such payment. For this purpose, the Issuer shall satisfy the Solvency Condition if:
(i) it is able to pay its debts to all Senior Creditors, the Holders of reorganization or readjustment), shall be received by the Notes and the holders of any Parity Securities as they fall due; and
(ii) its total Assets exceed total Liabilities, other than Liabilities to persons who are neither Senior Creditors, the Holders of the Notes before all Senior Indebtedness is paid in full, or provision made for its payment, such payment or distribution shall be paid over to nor the holders of Senior Indebtedness remaining unpaid or unprovided for or their representative or representatives or any Parity Securities: PROVIDED further that (subject to the trustee or trustees under any indenture under which any instruments evidencing any provisions of such Senior Indebtedness may have been issued, paragraph 7.6 below):
(i) only if Regulatory Capital Requirement (Principal) is specified as provided being applicable in the foregoing paragraph (2)Final Terms, for application to the payment all payments of such Senior Indebtedness until all such Senior Indebtedness shall have been paid in full, after giving effect to any concurrent payment or distribution, or provision therefor, to the holders of such Senior Indebtedness.
4.3 Subject to the payment in full of all Senior Indebtedness, the holders of the Notes shall be subrogated to the rights of the holders of Senior Indebtedness to receive payments or distributions of cash, property or securities of the Company applicable to the Senior Indebtedness until the principal of and interest on the Notes shall be paid in full, and no such payments or distributions in respect of the Notes shall, unless otherwise permitted by the Relevant Regulator, be conditional upon the Regulatory Capital Requirements being met both at the time of, and immediately after, any such payment. Unless otherwise permitted by the Relevant Regulator, the Issuer will not make any payment of cashprincipal and any such payment shall not be payable unless the Regulatory Capital Requirement is met both at the time of, property and immediately after, any such payment; and
(ii) only if Regulatory Capital Requirement (All Amounts) is specified as being applicable in the Final Terms, all payments under or securities distributable arising from any Notes, the Coupons or these presents, other than payments to the Senior Indebtedness Trustee made in accordance with these presents in respect of, inter alia, the Trustee's fees, and remuneration and expenses and liabilities incurred by it in carrying out its duties under the provisions hereof these presents, shall, unless otherwise permitted by the Relevant Regulator, be conditional upon the Regulatory Capital Requirement being met both at the time of, and immediately after, any such payment. Unless otherwise permitted by the Relevant Regulator, the Issuer will not make any payment and any such payment shall not be payable under or arising from the Notes, the Coupons or these presents relating to them or arising therefrom, unless the Regulatory Capital Requirement is met both at the time of, and immediately after, any such payment.
7.3 The Issuer may at any time and shall whenever requested by the Trustee procure a report as between to whether the CompanyIssuer satisfies the Solvency Condition for the purposes of subparagraph 7.1 above by two Directors of the Issuer or, if the Issuer is in winding up in England and Wales, its creditors other than liquidator and, in the holders absence of senior Indebtednessmanifest error any such report shall be treated and accepted by the Issuer, and the Trustee, the Holders of the Notes, Notes and the Couponholders as correct and sufficient evidence thereof and may be deemed to be a payment relied upon by the Company Trustee without further enquiry. In the absence of any such report to or on account the contrary, it shall for the purposes hereof be assumed (unless the contrary is proved prior to the date of Notes. It is understood that the provisions of this Section 4 are and are intended solely payment or, for the purposes of defining the relative rights second and fourth trusts of Clause 10, within 30 days after receipt by the Trustee of any moneys in respect of such Notes) that the Issuer is and will after any payment hereunder satisfy the Solvency Condition for the purposes of subparagraph 7.1 above. In the event of the holders delivery of a report of two Directors of the NotesIssuer that the Issuer will not satisfy the Solvency Condition, on the one hand, and Issuer shall procure that the holders Auditors shall provide within 30 days of the Senior Indebtedness, on the other hand. Nothing contained in this Section 4 is intended to or shall impair, as between the Company, its creditors other than the holders date of Senior Indebtedness, and the holders such report of two Directors of the NotesIssuer, a report of the Auditors as to whether or not the Issuer satisfies the Solvency Condition for the purposes of subparagraph 7.1 above and such report of the Auditors shall supersede the report of two Directors of the Issuer for all purposes of these presents.
7.4 The Issuer may at any time and shall whenever requested by the Trustee procure a report as to the Issuer's compliance with the Regulatory Capital Requirement for the purposes of subparagraph 7.1 above signed by two Directors of the Issuer or, if there is a winding-up of the Issuer in England and Wales, the absolute and unconditional obligation liquidator of the Company to pay to Issuer and any such report shall, in the holders absence of manifest error, be treated and accepted by the Notes Issuer, the principal of and interest on Trustee, the Notes as and when the same shall become due and payable in accordance with their terms, or is intended to or shall affect the relative rights of the holders Holders of the Notes and creditors the Couponholders as correct and sufficient evidence thereof and may be relied upon by the Trustee without further enquiry. In the absence of any such report to the contrary, it shall for the purposes hereof be assumed (unless the contrary is proved prior to the date of payment or, for the purposes of the Company other than second and fourth trusts of Clause 10, within 30 days after receipt by the holders of the Senior Indebtedness; nor shall anything herein or therein prevent the holder Trustee of any Note from exercising all remedies otherwise permitted by applicable law upon default under the Notes, subject to the rights, if any, under this Section 4 of the holders of Senior Indebtedness moneys in respect of cashsuch Notes) that the Issuer is and will after any payment hereunder satisfy the Regulatory Capital Requirement for the purposes of subparagraph 7.2. Without prejudice to the rest of these presents, property amounts representing payments of (i) only if Regulatory Capital Requirement (All Amounts) is specified as applicable in the Final Terms, any amount or securities (ii) only if Regulatory Capital Requirement (Principal) is specified as applicable in the Final Terms, any payment of principal, under or arising from the Subordinated Notes, any relative Coupon and these presents relating to them in respect of which the Solvency Condition, or the Regulatory Capital Requirement is not met, both at the time of, and immediately after, the time at which the same would otherwise be due and payable (Solvency Claims), will be payable by the Issuer in a winding-up of the Company received upon Issuer as provided in Condition 3.1 and this Clause 7. A Solvency Claim shall not bear interest, except in the exercise of any such remedy.
4.4 Upon any distribution of assets of the Company limited circumstances referred to in this Section 4, Condition 5.7.
7.5 The trust secondly mentioned in paragraph 7.1 above may be performed by the holders Trustee repaying to the liquidator for the time being of the Notes Issuer (the Liquidator) the amount so to be distributed on terms that the Liquidator shall distribute the same accordingly and in that event the Trustee shall not be bound to supervise such distribution and the receipt of the Liquidator for any moneys so paid by the Trustee to him shall be a good discharge to the Trustee for the performance by the Trustee of the trust secondly mentioned in paragraph 7.1 above.
7.6 The Trustee shall be entitled and it is hereby authorised to rely upon call for and to accept as conclusive evidence thereof a certificate from the Liquidator as to:
(a) the amounts of the liquidating trustee or agent or other person making any distribution claims of all Senior Creditors referred to such holders for the purpose of ascertaining in paragraph 7.1 above; and/or
(b) the persons entitled to participate in such distribution, the holders of the Senior Indebtedness thereto and other indebtedness of the Company, the amount thereof or payable thereon and all other fact pertinent thereto or to this Section 4their respective entitlements.
4.5 If there shall have occurred a default in the payment of the principal of (or premium, if any) or interest on any Senior Indebtedness, then, unless and until such default shall have been cured or waived, or payment of principal or interest shall be made by the Company on the Notes, and no holder of Notes shall be entitled to receive any such payment. Nothing contained in this Section 4 shall, however (1) affect the obligation of the Company to make, or prevent the Company from making, at any time, except during the pendency of any dissolution, winding up, liquidation or reorganization proceedings or except as provided in the first sentence of this Section 4.5, payments of principal of or interest on the Notes, or (2) prevent the application by any paying agent of any moneys deposited with it by the Company to the payment of or on account of the principal of, or interest on, the Notes, if, at the time of such deposit, the paying agent did not have written notice of any event prohibiting the making of such payment or deposit by the Company, or (3) be construed as preventing the occurrence of any Event of Default hereunder.
4.6 No right of any present or future holder of any Senior Indebtedness of the Company to enforce subordination as herein provided shall at any time or in any way be prejudiced or impaired by any act or failure to act on the part of the Company or by any act or failure to act, in good faith, by any such holder, or by any noncompliance by the Company with the terms, provisions and covenants of this Note, regardless of any knowledge thereof any such holder may have or be otherwise charged with.
4.7 Any renewal or extension of the time of payment of any Senior Indebtedness or the exercise by the holders of Senior Indebtedness of any of their rights under the Senior Indebtedness, including without limitation the waiver of default thereunder or the release of any security therefor, may be made or done all without notice to or assent from the holders of the Notes. No compromise, alteration, amendment, modification, extension, renewal or other change of, or waiver, consent or other action in respect of, any liability or obligations under or in respect of, or of any of the terms, covenants or conditions of any indenture or other instrument under which any Senior Indebtedness is outstanding or of such Senior Indebtedness, and no release of property securing any Senior Indebtedness, whether or not such release is in accordance with the provisions of any applicable documents, shall in any way alter or affect any of the provisions of this Section 4.
Appears in 1 contract
Sources: Trust Deed
SUBORDINATION OF NOTES. 4.1 (a) The CompanyNotes including, for itselfwithout limitation, its successors and assignsall debt and/or payments on account of thereof, covenants and agreesshall be subject, subordinate, and each holder junior, in right of Notes by its acceptance thereof likewise covenants payment and agrees, that the payment exercise of the principal of and interest on each and all of the Notes shall be subordinate and subjectremedies, to the extent and in the manner hereinafter set forthforth herein, in right of payment to the prior payment in full of all Indebtedness under the Senior IndebtednessSecured Loan. Except as permitted by this Indenture, the Noteholders will not ask, demand, ▇▇▇ for, take or receive, directly or indirectly, from Issuer in cash or other property, by set-off, or in any other manner, payment of, or security for, any or all of the Indebtedness owing under the Notes unless and until all Indebtedness under the Senior Secured Loan has been paid in full. Each Noteholder, Guarantor and the Trustee hereby acknowledge and agree that the Senior Secured Lenders will have relied upon and will continue to rely upon the subordination provisions provided for herein and the other provisions hereof in entering into the Loan Documents.
4.2 Upon (b) In the event of any payment or distribution of assets of Issuer, the Company upon Guarantors, their successors and assigns, of any kind or character, whether in cash, property, or securities, through a dissolution, winding up, liquidation liquidation, arrangement or reorganization of the Companyrelating to Issuer, its successors and/or assigns, whether in any bankruptcy, insolvency proceeding, arrangement, reorganization or receivership proceedings or upon an assignment for the benefit of creditors or any other dissolution, winding up, liquidation or reorganization marshalling of the Company:
(1) Any assets and liabilities of Issuer, its successors and/or assigns, whether voluntary or involuntary, all Indebtedness on account of the Senior Indebtedness Secured Loan shall first be paid in full, or provision made for such payment in full of the principal thereof, and premium, if any, and interest thereon, before any payment is made on account the Notes are made. In any proceeding referred to in this paragraph of this commenced by or against the Issuer:
(i) Noteholders shall assign their respective claims to Senior Secured Lenders for all purposes.
(ii) Noteholders shall not object or otherwise interfere with any motion to sell, use or otherwise dispose the Senior Secured Lenders’ collateral and shall not file any such motion.
(iii) Noteholders shall not oppose or otherwise interfere with any motion filed by Senior Secured Lenders for relief from automatic stay with respect to their collateral and shall not file any such motion.
(iv) Noteholders shall not oppose or otherwise interfere with the confirmation of any plan filed by Senior Secured Lenders and shall not propose any plan.
(v) Noteholders shall not oppose or otherwise interfere with any motion by Senior Secured Lenders to convert or dismiss the bankruptcy case and shall not file any such motion.
(vi) Noteholders shall not oppose or otherwise interfere with any motion by Senior Secured Lenders to appoint a trustee or an examiner and shall not file any such motion.
(vii) Noteholders shall not oppose any motion to seek post-petition financing from the Senior Secured Lenders under section 364 of the principal of, or interest on, the Notes;Code.
(2viii) Noteholders shall not object to the allowance of Senior Secured Lenders’ claim.
(ix) Noteholders shall not seek to subordinate or recharacterize the Senior Secured Lenders’ claim.
(x) Noteholders shall not commence any avoidance action against the Senior Secured Lenders.
(xi) Any payment or distribution of assets of the company of any kind or character, whether in cash, property or securities (other than stock of the Company as reorganized or readjusted or securities of the Company or any other corporation provided for by a plan of reorganization or readjustment the payment of which is subordinate, at least to the extent provided in this Section 4 with respect to the Notes, to the payment of all Senior Indebtedness at the time outstanding and to any securities issued in respect thereof under any such plan or reorganization or readjustment), to which the holders of the Notes Noteholders would be entitled except (but for the provisions of this Section 4 hereof) shall be paid or delivered by the liquidating trustee or in bankruptcy, receiver, assignee for the benefit of creditors, debtor in possession, disbursing agent or other person liquidating agent making such payment or distribution, whether a trustee in bankruptcy, a receiver or liquidating trustee or other trustee or agent, distribution directly to the holders of senior Indebtedness or their representative or representatives or to the trustee or trustees under any indenture under which any instruments evidencing any of such Senior Indebtedness may have been issued, ratably according to the aggregate amounts remaining unpaid on account of the principal of, and premium, if any, and interest on, the Senior Indebtedness held or represented by each, to the extent necessary to make payment in full of all Senior Indebtedness remaining unpaid, after giving effect to any concurrent payment or distribution, or provision therefor, to the holders of such Senior Indebtedness; and
(3) In the event that, notwithstanding the foregoing, any payment or distribution of assets of the Company of any kind or character, whether in cash, property or securities (other than stock of the Company as reorganized or readjusted or securities of the Company or any other corporation provided for by a plan of reorganization or readjustment the payment of which is subordinate, at least to the extent provided in this Section 4 with respect to the Notes, to the payment of all Senior Indebtedness at the time outstanding and to any securities issued in respect thereof under any such plan of reorganization or readjustment), shall be received by the holders of the Notes before all Senior Indebtedness is paid in full, or provision made for its payment, such payment or distribution shall be paid over to the holders of Senior Indebtedness remaining unpaid or unprovided for or their representative or representatives or to the trustee or trustees under any indenture under which any instruments evidencing any of such Senior Indebtedness may have been issued, as provided in the foregoing paragraph (2), Secured Lenders for application to the payment of the Senior Secured Loan all Indebtedness thereunder has been paid in full.
(xii) Noteholders shall designate the Senior Secured Lenders as their assignee to receive any distributions payable to the Noteholders in connection with a subsequent bankruptcy.
(xiii) Noteholders shall not serve on any official or un-official committee.
(xiv) Noteholders shall not permit any of its professionals to seek compensation from the bankruptcy estate.
(c) In any proceeding referred to in subsection (b) of this Section 4.01 commenced by or against, the Issuer, Guarantors, their subsidiaries, affiliates, successors and/or assigns,
(i) Each of the Senior Secured Lenders may, and is irrevocably authorized and empowered (in its own name or in the name of the Noteholder or otherwise), but shall have no obligation, to, (A) demand, ▇▇▇ for, collect and receive every payment or distribution referred to in subsection (b) of this Section 4.01 and give acquittance therefor and (B) file claims and proofs of claim in respect of the Notes and take such other action (including, without limitation, voting the Indebtedness on account of the Notes) as the Senior Secured Lenders may deem necessary or advisable for the exercise or enforcement of any of the rights or interests of the Senior Secured Lenders hereunder; and
(ii) the Noteholders shall duly and promptly take such action as the Senior Secured Lenders may request (A) to file appropriate claims or proofs of claim with respect thereto, and (B) to execute and deliver to the Senior Secured Lenders such powers of attorney, assignments or other instruments as the Senior Secured Lenders may request in order to enable it to enforce any and all claims with respect to, and any security interests and other liens securing payment of, the Indebtedness due and owing under the Notes.
(d) So long as any of the Indebtedness under the Senior Secured Loan Documents shall remain outstanding, the Noteholders will not, without the prior written consent of the Senior Secured Lenders:
(i) obtain or otherwise receive the benefit of any security interest or other lien securing any Indebtedness;
(ii) sell, assign, pledge, encumber or otherwise dispose of any Indebtedness under the Notes unless such sale, assignment, pledge, encumbrance or disposition is made expressly subject to these subordination provisions;
(iii) declare any or all of the Indebtedness under the Notes due and payable prior to the date fixed therefor other than subsequent to the declaration by the Senior Secured Lenders that any or all Indebtedness under the Senior Secured Loan is due and payable prior to the date fixed therefor; or
(iv) commence, or join with any creditor other than the Senior Secured Lenders in commencing, any proceeding referred to in Section 4.01(b).
(e) All payments or distributions upon or with respect to the Notes or any Indebtedness thereunder which are received by any Noteholder contrary to these subordination provisions or in violation of the Financing Agreement as in effect on the Effective Date, shall be received in trust for the benefit of the Senior Secured Lenders, shall be segregated from other funds and property held by such Noteholder and shall be forthwith paid over to the Senior Secured Lenders in the same form as so received (with any necessary endorsement) to be applied (in the case of cash) to or held as collateral (in the case of securities or other non-cash property) for the payment or prepayment of the Indebtedness under the Senior Secured Loan Documents until all such Senior Indebtedness shall have been paid in full, after giving effect to any concurrent payment or distribution, or provision therefor, to the holders of such Senior Indebtedness.
4.3 Subject to (f) These subordination provisions constitute a continuing agreement of subordination and shall continue in effect and be binding upon each Noteholder and upon the Trustee until payment in full of all Senior Indebtedness, the holders of the Notes shall be subrogated to the rights of the holders of Senior Indebtedness to receive payments or distributions of cash, property or securities of the Company applicable to the Senior Indebtedness until the principal of and interest on the Notes shall be paid in full, and no such payments or distributions in respect of the Notes of cash, property or securities distributable to the Senior Indebtedness under the provisions hereof shallSenior Secured Loan Documents. The subordinations, as between the Company, its creditors other than the holders of senior Indebtednessagreements, and priorities set forth herein shall remain in full force and effect regardless of whether any party hereto in the Holders of the Notesfuture seeks to rescind, be deemed to be a payment by the Company to or on account of Notes. It is understood that the provisions of this Section 4 are and are intended solely for the purposes of defining the relative rights of the holders of the Notesamend, on the one hand, and the holders of the Senior Indebtedness, on the other hand. Nothing contained in this Section 4 is intended to or shall impair, as between the Company, its creditors other than the holders of Senior Indebtedness, and the holders of the Notes, the absolute and unconditional obligation of the Company to pay to the holders of the Notes the principal of and interest on the Notes as and when the same shall become due and payable in accordance with their termsterminate, or is intended to or shall affect reform the relative rights of the holders of the Notes and creditors of the Company other than the holders of the Senior Indebtedness; nor shall anything herein or therein prevent the holder of agreements set forth herein, in any Note from exercising all remedies otherwise permitted or other document relating to any Indebtedness thereunder, by applicable law upon default under the Notes, subject to the rights, if any, under this Section 4 of the holders of Senior Indebtedness in respect of cash, property litigation or securities of the Company received upon the exercise of any such remedyotherwise.
4.4 Upon any distribution of assets of the Company referred to in this Section 4, the holders of the Notes shall be entitled to rely upon a certificate of the liquidating trustee or agent or other person making any distribution to such holders for the purpose of ascertaining the persons entitled to participate in such distribution, the holders of the Senior Indebtedness and other indebtedness of the Company, the amount thereof or payable thereon and all other fact pertinent thereto or to this Section 4.
4.5 If there shall have occurred a default in the payment of the principal of (or premium, if anyg) or interest on any Senior Indebtedness, then, unless and until such default shall have been cured or waived, or payment of principal or interest shall be made by the Company on the Notes, and no holder of Notes shall be entitled to receive any such payment. Nothing contained in this Section 4 shall, however (1) affect the obligation of the Company to make, or prevent the Company from making, at any time, except during the pendency of any dissolution, winding up, liquidation or reorganization proceedings or except as provided in the first sentence of this Section 4.5, payments of principal of or interest on the Notes, or (2) prevent the application by any paying agent of any moneys deposited with it by the Company to the payment of or on account of the principal of, or interest on, the Notes, if, at the time of such deposit, the paying agent did not have written notice of any event prohibiting the making of such payment or deposit by the Company, or (3) be construed as preventing the occurrence of any Event of Default hereunder.
4.6 No right of any present or future holder of any Senior Indebtedness of the Company to enforce subordination as herein provided shall at any time or in any way be prejudiced or impaired by any act or failure to act on the part of the Company Senior Secured Lenders to exercise, and no delay in exercising, any right, remedy, power, or by privilege shall operate as a waiver thereof, nor shall any act single or failure to act, in good faith, by partial exercise of any such holderright, remedy, power, or by privilege preclude any noncompliance by the Company with the terms, provisions and covenants of this Note, regardless of any knowledge other or further exercise thereof any such holder may have or be otherwise charged with.
4.7 Any renewal or extension of the time of payment of any Senior Indebtedness or the exercise by the holders of Senior Indebtedness of any other right, remedy, power, or privilege. The rights and remedies under this Agreement are cumulative and not exclusive of their rights under any rights, remedies, powers, and privileges that may otherwise be available to the Senior Indebtedness, including without limitation Secured Lenders.
(h) The Senior Secured Lenders shall be authorized to demand specific performance of these subordination provisions at any time when the waiver of default thereunder or the release of any security therefor, may be made or done all without notice Noteholders shall have failed to or assent from the holders of the Notes. No compromise, alteration, amendment, modification, extension, renewal or other change of, or waiver, consent or other action in respect of, any liability or obligations under or in respect of, or of comply with any of the terms, covenants or conditions of subordination provisions applicable to any indenture or other instrument under which any Senior Indebtedness is outstanding or of such Senior Indebtedness, and no release of property securing any Senior Indebtedness, Noteholder whether or not such release is in accordance the Issuer shall have complied with the provisions of any applicable documents, shall in any way alter or affect any of the subordination provisions applicable to the Issuer, and the Noteholders irrevocably waive any defenses based on the adequacy of a remedy at law which might be asserted as a bar to such remedy of specific performance.
(i) Notwithstanding anything to the contrary contained herein, this Indenture may not be amend, waived or supplemented to change, supplement or impair any of this Section 4Article 11 without the express written consent of the Senior Secured Lenders.
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Sources: Indenture (Elk Horn Coal Co LLC)