Exhibit T3C-4
[Exhibit C to the Indenture]
SRZ Draft
03/10/00
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INTERCREDITOR AND SUBORDINATION AGREEMENT
dated as of March __, 2000
among
THE CIT GROUP/BUSINESS CREDIT, INC.,
THE SENIOR AGENT ON BEHALF OF THE CR SENIOR LENDERS,
WILMINGTON TRUST COMPANY, AS AGENT
FOR LENDERS [IDENTIFIED ON EXHIBIT A]
UNITED STATES TRUST COMPANY OF NEW YORK,
THE JUNIOR SUBORDINATED TRUSTEE
CONSENTED TO BY THE NOTEHOLDERS APPEARING ON
SIGNATURE PAGE
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TABLE OF CONTENTS
PAGE
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ARTICLE I DEFINITIONS.....................................................2
Section 1.1 Certain Definitions.......................................2
Section 1.1 A BH/PIK Lenders Lien Subordination.........................6
Section 1.1 B CR/Junior Subordinated Trustee Lien Subordination.........7
Section 1.1 C Junior Subordinated Noteholders Debt Subordination........9
Section 1.1 D BH Deficiency Claim Subordination........................10
Section 1.1 E Junior Subordinated Deficiency Claim Subordination.......10
Section 1.2 No Payment Upon Insolvency Event..........................7
Section 1.3 No Payment When CR Senior Obligations in Default..........8
Section 1.4 Remedies Standstill.......................................8
Section 1.5 Waiver of Certain Rights.................................11
Section 1.6 [Intentionally Left ▇▇▇▇▇................................12
Section 1.7 [Intentionally Left Blank]................................9
Section 1.8 Provisions Solely To Define Relative Rights...............9
Section 1.9 No Waiver of Subordination Provisions.....................9
Section 1.10 Amendments, etc..........................................10
Section 1.11 Specific Enforcement.....................................10
ARTICLE II COLLATERAL ISSUES, ETC........................................10
Section 2.1 Representations and Warranties as to this Agreement......10
Section 2.2 CR First Priority Collateral Rights......................10
Section 2.3 A BH First Priority Collateral Rights......................11
Section 2.3 B BH First Priority Collateral Sale Proceeds Shortfall.....16
Section 2.4 Guaranty and Subordination Action........................11
Section 2.5 [Intentionally Left Blank]...............................12
Section 2.6 Exclusive Enforcement Rights.............................12
ARTICLE III OTHER AGREEMENTS.............................................13
Section 3.1 Releases................................................13
Section 3.2 Insurance and Condemnation Awards.......................14
Section 3.3 No Additional Obligations...............................14
Section 3.4 Waivers.................................................15
Section 3.5 Information Concerning PHI, etc.........................16
Section 3.6 Application of Payments.................................16
Section 3.7 Independent Decisions...................................16
Section 3.8 Turnover of Prohibited Transfers........................17
Section 3.9 Effectiveness During Insolvency Proceeding..............17
Section 3.10 Amendments..............................................17
Section 3.11 Limitation on Declaring Defaults........................17
Section 3.12 Duration and Termination; Payment Invalidated...........17
Section 3.13 Notice of BH/PIK Lenders Interests......................18
Section 3.14 Credit Documents........................................19
Section 3.15 Bailee for Perfection...................................19
Section 3.16 Legend..................................................19
Section 3.17 Junior Subordinated Lenders: Power of Attorney;
Agreement to Cooperate..................................19
Section 3.18 BH Senior Lenders: Power of Attorney; Agreement
to Cooperate............................................20
Section 3.19 CR Senior Lenders/Junior Subordinated Lenders:
Power of Attorney; Agreement to Cooperate...............28
ARTICLE IV MISCELLANEOUS.................................................20
Section 4.1 Conflict................................................20
Section 4.2 No Third Party Benefit, etc.............................20
Section 4.3 Amendments and Waivers..................................21
Section 4.4 Successors and Assigns..................................21
Section 4.5 Partial Invalidity......................................21
Section 4.6 Communications..........................................21
Section 4.7 Governing Law; Consent to Jurisdiction..................22
Section 4.8 Forum Selection and Consent to Jurisdiction.............22
Section 4.9 Waiver of Jury Trial, etc...............................23
Section 4.10 Counterparts............................................23
Section 4.11 Further Assurances......................................23
Section 4.12 Specific Enforcement....................................23
Section 4.13 Acknowledgement by PHI..................................23
SCHEDULES
Schedule 1 - List of Borrowers
Schedule 2 - CR First Priority Collateral
Schedule 3 - BH First Priority Collateral
Annex I - CR Senior Security Agreements
Annex II - BH Senior Security Agreements
Annex III - Junior Subordinated Security Agreements
Annex IV - BH Revolver Participation
INTERCREDITOR AND SUBORDINATION AGREEMENT
THIS INTERCREDITOR AND SUBORDINATION AGREEMENT, dated as of March __,
2000 (as amended, restated or otherwise modified from time to time, this
"AGREEMENT"), among THE CIT GROUP/BUSINESS CREDIT, INC., ("CIT") as agent for
CIT ROTHSCHILD RECOVERY FUND, L.P. ("Rothschild") and the other lenders party
to the CR Senior Credit Agreement from time to time (together with its
successors and assigns, in such capacity, the "CR Senior Agent") pursuant to the
CR Senior Credit Agreement (as hereinafter defined), WILMINGTON TRUST COMPANY,
as agent (the "BH Senior Agent") for each BH Senior Lender identified in Exhibit
A annexed hereto (together with any and all successors and assigns,
collectively, the "BH Senior Lenders") under the BH Note Purchase Agreement (as
hereinafter defined), UNITED STATES TRUST COMPANY OF NEW YORK as trustee under
the Junior Subordinated Indenture (as hereinafter defined) (together with its
successors and assigns in such capacity, the "Junior Subordinated Trustee")
consented to by the Junior Subordinated Noteholders appearing on the signature
page hereto.
RECITALS:
WHEREAS, Planet Hollywood International, Inc. ("PHI"), and the other
entities listed on Schedule 1 hereto (herein being referred to collectively as
the "COMPANY"), CIT, Rothschild and various financial institutions as may from
time to time become parties thereto (collectively, the "CR SENIOR LENDERS") and
the CR Senior Agent are entering into a Revolving Credit Agreement, dated as of
the date hereof (as amended, restated, supplemented, replaced or otherwise
modified from time to time in accordance with SECTION 3.10 hereof, the "CR
SENIOR CREDIT AGREEMENT") and the CR Guaranties (as hereinafter defined);
WHEREAS, the CR Senior Obligations as hereinafter defined are secured
by (a) first priority perfected liens on and security interests in substantially
all of the assets (excluding the BH First Priority Collateral) of the Company
and the Subsidiary Guarantors (as hereinafter defined) as more fully described
on Schedule 2 hereto (collectively, the "CR FIRST PRIORITY COLLATERAL"), and (b)
second priority perfected liens on and security interest in all real property of
the Company located at ▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ and the other
collateral listed on and as more fully described on Schedule 3 (the "BH FIRST
PRIORITY COLLATERAL"), in each case pursuant to the CR Senior Security
Agreements;
WHEREAS, the Company and the BH Senior Agent and the BH Senior Lenders
are entering into a SENIOR NOTE PURCHASE AGREEMENT, dated as of the date hereof
(as amended, restated, supplemented, replaced or otherwise modified from time to
time in accordance with SECTION 3.10, the "BH NOTE PURCHASE AGREEMENT") and the
BH Guaranties (as hereinafter defined);
WHEREAS, the BH Senior Obligations (as hereinafter defined) are
secured by (a) second priority perfected liens on and security interests in
substantially all of the CR First Priority Collateral and (b) first priority
perfected liens on all of the BH First Priority Collateral, in each case
pursuant to the BH Senior Security Agreements; and
WHEREAS, the Company, and the Junior Subordinated Trustee, are
entering into a Junior Subordinated Indenture dated, as of the date hereof (as
amended, restated, supplemented, replaced or otherwise modified from time to
time in accordance with SECTION 3.10 hereof, the "JUNIOR SUBORDINATED
INDENTURE");
WHEREAS, the Junior Subordinated Obligations (as hereinafter defined)
are secured by third priority perfected liens on and security interests in all
the Intercreditor Collateral (as hereinafter defined) pursuant to the Junior
Subordinated Credit Documents (as hereinafter defined);
WHEREAS, the Junior Subordinated Obligations are junior and
subordinate in right of payment in full in cash of the CR Senior Obligations and
the BH Senior Obligations;
WHEREAS, this Agreement, (a) confirms (i) the first priority perfected
security interests and liens of the CR Senior Agent in the CR First Priority
Collateral, (ii) the second priority perfected security interests and liens of
the CR Senior Agent in the BH First Priority Collateral, (iii) the second
priority perfected security interests and liens of the BH Senior Agent in the CR
First Priority Collateral, (iv) the first priority perfected security interests
and liens of the BH Senior Agent in the BH First Priority Collateral (the "CR
First Priority Collateral" and the "BH First Priority Collateral" being
collectively referred to as the "INTERCREDITOR COLLATERAL"), and (v) the third
priority security interests and liens of the Junior subordinated Trustee in the
CR First Priority Collateral and the BH First Priority Collateral, and (b)
provides for the relative rights of the Intercreditor Parties, in connection
with, among other things, the enforcement of their respective security interests
and liens in the Intercreditor Collateral.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants herein contained, and for other good and valuable consideration, each
of the CR Senior Agent, the BH Senior Agent, and the Junior Subordinated Trustee
hereby agrees as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 CERTAIN DEFINITIONS. The following terms when used in this
Agreement shall have the following meanings:
"AGREEMENT" is defined in the PREAMBLE hereto.
"APPLICABLE LAW" means any law of the United States or any other
jurisdiction where any Intercreditor Collateral is located or any Obligor
operates, including, without limitation, the UCC.
"BANKRUPTCY CODE" means Title 11 of the United States Bankruptcy Code
(11 U.S.C. ss. 101 et seq.), as amended from time to time and any successor
statute.
"BH DEFICIENCY CLAIM" means the amount, if any, of BH Senior
Obligations remaining unpaid and/or not satisfied after all of the Intercreditor
has been sold, transferred, liquidated or otherwise disposed of on account of
any Remedial action or otherwise.
"BH FIRST PRIORITY COLLATERAL" is defined in SECOND RECITAL hereto.
"BH FIRST PRIORITY COLLATERAL PROCEEDS" is defined in Section 1.2(a)
hereof.
"BH FIRST PRIORITY COLLATERAL SALE" means any sale, lease, transfer or
other disposition of all or any portion of any BH first Priority Collateral that
is not a Permitted Enforcement Action.
"BH GUARANTIES" means that certain or those certain guaranties of
payment of BH Senior Obligations executed by any BH Guarantor.
"BH GUARANTOR" means Planet Hollywood (Region III), Inc., Planet
Hollywood Hospitality, Inc. and any other Subsidiary Guarantor that owns any
interest in any of the BH First Priority Collateral.
"BH NOTE PURCHASE AGREEMENT" shall mean that certain Note Purchase
Agreement, dated March __, 2000, pursuant to which BH Senior Lenders acquired
certain secured senior notes, as amended, modified, supplemented or restated
from time to time.
"BH REVOLVER PARTICIPATIONS" means the junior participations, if any,
in the CR Credit Documents and CR Senior Obligations, substantially in
conformance with the form of participation annexed hereto as Exhibit C, that the
BH Senior Agent and/or the BH Senior Lenders may be required to purchase
pursuant to Section 2.3(b) hereof.
"BH SCHEDULED PAYMENTS" means (a) interest payable in respect of the
BH Senior Obligations at the Initial Note Rate (as such term is defined in the
BH Note Purchase Agreement) from time to time and (b) expenses payable and/or
reimbursable pursuant to the BH Note Purchase Agreement in an amount not to
exceed in the aggregate $150,000 (the "BH Scheduled Expenses").
"BH SENIOR AGENT" is defined in the PREAMBLE hereto.
"BH SENIOR LENDERS" is defined in the PREAMBLE hereto.
"BH SENIOR NOTE DOCUMENTS" collectively means the BH Note Purchase
Agreement, the BH Senior Security Agreements and all other documents,
instruments and agreements now or hereafter executed and/or delivered in
connection therewith, as the same may be amended, restated, supplemented,
replaced or otherwise modified from time to time in accordance with SECTION 3.10
hereof.
"BH SENIOR OBLIGATIONS" means the original aggregate principal amount
of $22,000,000 plus premium, if any, payable on redemption or prepayment of, and
interest on, all indebtedness and all other obligations now existing or
hereafter incurred under the BH Senior Note Documents, including without
limitation, all fees, expenses, claims, charges and indemnity obligations and
the Origination Fee (as defined in the BH Note Purchase Agreement).
"BH SENIOR SECURITY AGREEMENTS" collectively means all of the
agreements specified on ANNEX II hereto and each other guaranty, security
agreement, mortgage, deed of trust or other collateral agreement now or
hereafter entered into in connection with the BH Senior Obligations, each as may
be as amended, restated, supplemented, replaced or otherwise modified from time
to time in accordance with SECTION 3.10 hereof.
"BH/PIK CREDIT DOCUMENTS" collectively means the BH Senior Note
Documents and the Junior Subordinated Credit Documents.
"BH/PIK GUARANTIES" collectively means all the guaranties forming a
part of the BH Senior Note Documents or the Junior Subordinated Credit
Documents.
"BH/PIK LENDERS" collectively means the BH Senior Lenders, the BH
Senior Agent, the Junior Subordinated Trustee and the Junior Subordinated
Noteholders.
"BH/PIK OBLIGATIONS" collectively means the BH Senior Obligations and
the Junior Subordinated Obligations.
"BH/PIK SECURITY AGREEMENTS" collectively means the BH Senior Security
Agreements and the Junior Subordinated Security Agreements.
"COMPANY" is defined in the FIRST RECITAL hereto.
"CR COLLATERAL PROCEEDS" is defined in SECTION 3.18 hereof.
"CR CREDIT DOCUMENTS" collectively means the CR Senior Credit
Agreement, the CR Senior Security Agreements and all other documents,
instruments and agreements now or hereafter executed and/or delivered in
connection therewith, each as may be amended, restated, supplemented, replaced
or otherwise modified from time to time in accordance with SECTION 3.10 hereof.
"CR DEFICIENCY CLAIM" means the amount, if any, of CR Senior
Obligations remaining unpaid and/or not satisfied after all of the Intercreditor
Collateral has been sold, transferred, liquidated or otherwise disposed of on
account of any Remedial Action or otherwise.
"CR FIRST PRIORITY COLLATERAL" is defined in the SECOND RECITAL
hereto.
"CR GUARANTIES" means the guaranties forming a part of the CR Credit
Documents.
"CR SENIOR AGENT" is defined in the PREAMBLE hereto.
"CR SENIOR CREDIT AGREEMENT" is defined in the FIRST RECITAL hereto.
"CR SENIOR DEFAULT" is defined in SECTION 1.3 hereof.
"CR SENIOR LENDERS" is defined in the FIRST RECITAL hereto.
"CR SENIOR OBLIGATIONS" means the principal of, and premium, if any,
payable on redemption or prepayment of, and interest on, all indebtedness and
all other obligations now existing or hereafter incurred or owing under the CR
Credit Documents up to a maximum amount of $16,500,000 plus, all fees, expenses,
claims, charges and indemnity obligations.
"CR SENIOR SECURITY AGREEMENTS" collectively means all of the
agreements specified on ANNEX I hereto and each other guaranty, security
agreement, pledge agreement, mortgage, deed of trust or other collateral
agreement now or hereafter entered into in connection with the CR Senior
Obligations, each as may be as amended, restated, supplemented, replaced or
otherwise modified from time to time in accordance with SECTION 3.10 hereof.
"CREDIT DOCUMENTS" collectively means the CR Credit Documents and the
BH/PIK Credit Documents.
"GUARANTIES" collectively means the CR Senior Guaranties and the
BH/PIK Guaranties.
"GUARANTY ACTION" means any claim, demand, proceeding, action or act
against any guarantor pursuant to affecting or otherwise in connection with any
Credit Documents.
"INSOLVENCY PROCEEDING" means (a) any insolvency or bankruptcy case or
proceeding, or any receivership, liquidation, reorganization or other similar
case or proceeding relative to PHI, any Obligor or any of their property or
assets, (b) any liquidation, dissolution, reorganization or winding up of PHI or
any Obligor, whether voluntary or involuntary and whether or not involving
insolvency or bankruptcy, or (c) any assignment for the benefit of creditors or
any other marshalling of assets and liabilities of PHI or any Obligor.
"INTERCREDITOR COLLATERAL" is defined in the EIGHT RECITAL hereto,
together with all Proceeds therefrom.
"INTERCREDITOR PARTIES" collectively means the CR Senior Agent, the CR
Senior Lenders and the BH/PIK Lenders.
"JUNIOR SUBORDINATED CREDIT DOCUMENTS" means the Junior Subordinated
Indenture, the Junior Subordinated Notes the Subordinated Notes, the Junior
Subordinated Security Agreements and all other documents, instruments and
agreements executed and/or delivered in connection therewith, each as may be
amended, restated, supplemented, replaced or otherwise modified from time to
time in accordance with SECTION 3.10 hereof.
"JUNIOR SUBORDINATED DEFICIENCY CLAIM" means the amount, if any, of
Junior Subordinated Obligations remaining unpaid and/or not satisfied after all
of the Intercreditor Collateral has been sold, transferred, liquidated or
otherwise disposed of on account of any Remedial Action or otherwise.
"JUNIOR SUBORDINATED INDENTURE" is defined in the FIFTH RECITAL
hereto.
"JUNIOR SUBORDINATED NOTES" means the notes issued pursuant to the
Junior Subordinated Indenture.
"JUNIOR SUBORDINATED NOTEHOLDERS" means the holders of the Junior
Subordinated Notes.
"JUNIOR SUBORDINATED NOTEHOLDER PERMITTED ACTION" means any lawsuit
permitted by Section 316(b) of the Trust Indenture Act to be commenced and
prosecuted by any Junior Subordinated Noteholder on account of non-payment of
principal and/or interest due and payable in accordance with the terms and
conditions of the Junior Subordinated Indenture.
"JUNIOR SUBORDINATED OBLIGATIONS" means the principal of, and premium,
if any, payable on redemption or prepayment of, and interest on, all
indebtedness and all other obligations now existing or hereafter incurred or
owing under, the Junior Subordinated Credit Documents, including without
limitation, all fees, expenses, claims, charges and indemnity obligations.
"JUNIOR SUBORDINATED SCHEDULED PAYMENTS" means, at such time when
interest in respect of the Junior Subordinated Notes is required to be
paid in cash under the terms of the Junior Subordinated Indenture, interest
payable at the non-default rate pursuant to Section __ of the Junior
Subordinated Indenture.
"JUNIOR SUBORDINATED SECURITY AGREEMENTS" collectively means all of
the agreements specified on ANNEX III hereto and each other guaranty, security
agreement, pledge agreement, mortgage, deed of trust or other collateral
agreement now or hereafter entered into in connection with the Junior
Subordinated Obligations, each as may be as amended, restated, supplemented,
replaced or otherwise modified from time to time in accordance with SECTION 3.10
hereof.
"JUNIOR SUBORDINATED TRUSTEE" is defined in the PREAMBLE hereto.
"LEGEND" is defined in SECTION 3.16 hereof.
"LIEN" means, with respect to any property or asset, any mortgage,
lien, pledge, charge, security interest or encumbrance of any kind in respect of
such property or asset.
"NET PROCEEDS" means, for any BH First Priority Collateral Sale or any
Permitted Enforcement Action, the amount of cash and other payments received by
the Company or the BH Senior Lenders net of the (i) amount, if any, of BH
Scheduled expenses previously paid by the Company (which amount shall be
retained by the Company from such Net Proceeds) and (ii) repayment of
Indebtedness secured by a Permitted Lien on the subject asset having a higher
priority than the priority of the Lien in favor of the BH Senior Agent on the
subject asset (as such terms are defined in the BH Note Purchase Agreement).
"OBLIGOR" means PHI and each of its subsidiaries that is obligated
under any CR Credit Document or BH/PIK Credit Document.
"PARTICIPATION PERIOD" is defined in Section 2.3(b) hereof.
"PERMITTED ENFORCEMENT ACTION" means any Remedial Action taken by the
BH Senior Agent and/or any BH Senior Lenders solely with respect to BH First
Priority Collateral or any BH Guarantor that then owns any interest in any BH
First Priority Collateral.
"PHI" is defined in the FIRST RECITAL hereto.
"PROCEEDS" means "proceeds," as such term is defined in Section
9-306(1) of the UCC and, in any event, shall include without limitation, (a) any
and all proceeds of any insurance, indemnity, warranty or guaranty payable to
any Obligor from time to time with respect to any of the Intercreditor
Collateral, (b) any and all payments (in any form whatsoever) made or due and
payable to any Obligor from time to time in connection with any requisition,
confiscation, condemnation, seizure or forfeiture of all or any part of the
Intercreditor Collateral by any governmental authority, (c) any and all other
amounts from time to time paid or payable under or in connection with any of the
Intercreditor Collateral on account of any Guaranty Action or Remedial Action
and (d) the following types of property acquired with cash Proceeds: accounts,
chattel paper, contracts, documents, general intangibles, equipment, investment
property and inventory, as such terms are defined in the UCC.
"REMEDIAL ACTION" means any claim, action, proceeding, order, judgment
or agreement (whether by judicial action, self help or otherwise) to foreclose
upon, take possession or control of, sell, lease, dispose of or otherwise
realize upon or protect (including, without limitation, any treatment of, or
distribution with respect to, the BH Senior Obligations or CR Senior Obligations
pursuant to any plan of reorganization or liquidation of any entity comprising a
part of the Company) any Intercreditor Collateral or other property of the
Company or any Guarantor, whether pursuant to the UCC or other Applicable Law.
"SECURITY AGREEMENTS" collectively means the CR Senior Security
Agreements and the BH/PIK Security Agreements.
"SENIOR DEFAULT" is defined in SECTION 1.3 hereof.
"SUBSIDIARY GUARANTORS" collectively means [_______________].
"UCC" means the Uniform Commercial Code as in effect from time to time
in the State of New York.
SECTION 1.1 A BH/PIK LENDERS LIEN SUBORDINATION. Notwithstanding
anything contained in the BH/PIK Credit Documents or any other document or
instrument evidencing or in any way relating to the BH/PIK Obligations, the
security interests and liens of the BH/PIK Lenders in the CR First Priority
Collateral are expressly "subordinate and junior" to the lien of the CR Senior
Lenders in the CR First Priority Collateral. Except for (i) the BH First
Priority Collateral Proceeds paid at any time to the BH Senior Agent or to the
BH Senior Lenders or (ii) the Junior Subordinated Scheduled Payments and the BH
Scheduled Payments made by the Company to the BH Senior Agent, the BH Senior
Lenders, or to the Junior Subordinated Trustee or the Junior Subordinated
Noteholders at such times as are required under the BH/PIK Credit Documents (in
effect on the date hereof), "subordinate and junior" shall mean that until the
CR Senior Obligations shall have been paid in full and satisfied as more fully
described herein, the BH/PIK Lenders shall not, without the express prior
written consent of the CR Senior Lenders, (A) demand, require or accept any
payments or prepayment of the BH/PIK Obligations, except for or on account of
any Permitted Enforcement Action, (B) enforce or take any action to (x) enforce
or collect the BH/PIK Obligations or any portion thereof (other than, in the
case of the BH Senior Agent or any BH Senior Lender, any Permitted Enforcement
Action) or any BH First Priority Collateral Sale or, in the case of any Junior
Subordinated Noteholder, any Junior Subordinated Noteholder Permitted Action),
or (y) enforce any rights or remedies with respect to, or to realize upon, the
CR First Priority Collateral or (C) exercise any remedies with respect thereto
under the BH/PIK Credit Documents except, in the case of the BH Senior Agent or
any BH Senior Lender, for any Permitted Enforcement Action or any BH First
Priority Collateral Sale.
SECTION 1.1 B CR/JUNIOR SUBORDINATED TRUSTEE LIEN SUBORDINATION.
Notwithstanding anything contained in the CR Credit Documents, the Junior
Subordinated Creditor Documents or any other document or instrument evidencing
or in any way relating to the CR Senior Obligations and/or the Junior
Subordinated Obligations, the security interest and liens of the CR Senior
Agent, the CR Senior Lenders and the Junior Subordinated trustee in the BH First
Priority Collateral are expressly "subordinate and junior" to the security
interests and liens of the BH Senior Agent in the BH First Priority Collateral.
"Subordinate and junior" shall mean that until the BH Senior Obligations shall
have been paid in full and satisfied as more fully described herein (i) the CR
Senior Agent, the CR Senior Lenders and the Junior Subordinated Trustee shall
not, without the express prior written consent of the BH Senior Agent, (i)
enforce or take any action to enforce any rights or remedies with respect to, or
to realize upon, the BH First Priority Collateral, or any BH Guaranty, or (2)
exercise any remedies with respect thereto under the CR Credit Documents and/or
the Junior Subordinated Credit Documents, and (B) in addition, except for the
Junior Subordinated Scheduled Payments, the Junior Subordinated Trustee also
shall not, without the express prior written consent of the BH Senior Agent (1)
demand, require or accept any payment or prepayment of the Junior Subordinated
Obligations, or (2) enforce or take any action to enforce or collect the Junior
Subordinated Obligations or any portion thereof.
SECTION 1.1 C JUNIOR SUBORDINATED NOTEHOLDERS DEBT SUBORDINATION. To
the extent and in the manner hereinafter set forth, the payment of the Junior
Subordinated Obligations is hereby expressly made subordinate and subject in
right of payment to the prior payment in full in cash of all the CR Senior
Obligations (first) and the BH Senior Obligations (second) pursuant to the terms
of this Agreement unless and until the CR Senior Obligations and the BH Senior
Obligations shall have been indefeasibly paid in full and satisfied. The Junior
Subordinated Trustee and the Junior Subordinated Noteholders will not, without
the express prior written consent of the CR Senior Agent, with respect to the CR
First Priority Collateral, and the BH Senior Agent with respect to the BH First
Priority Collateral, take, demand or receive, and the Company or any Subsidiary
Guarantor will not make, give or permit, directly or indirectly, by setoff,
redemption, purchase or in any other manner, any payment on or security for the
whole or any part of the Junior Subordinated Obligations, and, without the
express prior written consent of the CR Senior Agent and the BH Senior Agent,
the Junior Subordinated Trustee and each of the Junior Subordinated Noteholders
will not accelerate the scheduled maturities of any amounts owing under the
Junior Subordinated Obligations; PROVIDED, HOWEVER, that the Company may make,
and the Junior Subordinated Trustee and each of the Junior Subordinated
Noteholders may demand and receive, the Junior Subordinated Scheduled Payments
so long as no Event of Default under and as defined in the CR Credit Documents
or the BH Note Documents shall have occurred and then be continuing, or would
occur as a result of such payment.
SECTION 1.1 D BH DEFICIENCY CLAIM SUBORDINATION. To the extent and in
the manner hereinafter set forth, the payment of the BH Deficiency Claim is
hereby expressly made subordinate and subject in right of payment to the prior
payment in full in cash of all the CR Deficiency Claims, and until such time,
the BH Senior Agent and each BH Senior Lender will not, without the express
prior written consent of the CR Senior Agent take, demand or receive, and the
Company or any Subsidiary Guarantor will not make, give or permit, directly or
indirectly, by setoff, redemption, purchase or in any other manner, any payment
for the whole or any part of the BH Deficiency Claim without the express written
consent of the CR Senior Agent.
SECTION 1.1 E JUNIOR SUBORDINATED DEFICIENCY CLAIM SUBORDINATION. To
the extent and in the manner hereinafter set forth, the payment of the Junior
Subordinated Deficiency Claim is hereby expressly made subordinate and subject
in right of payment to the prior payment in full in cash of all the CR
Deficiency Claims and all of the BH Deficiency Claims, and until such time, the
Junior Subordinated Trustee and each of the Junior Subordinated Noteholders will
not, without the express prior written consent of the CR Senior Agent and the BH
Senior Agent, take, demand or receive, and the Company or any Guarantor will not
make, give or permit, directly or indirectly, by setoff, redemption, purchase or
in any manner, any payment for the whole or any part of the Junior Subordinated
Deficiency Claim without the express written consent of the CR Senior Agent and
the BH Senior Agent.
SECTION 1.2 NO PAYMENT UPON INSOLVENCY EVENT. During any Insolvency
Proceeding:
(a) the CR Senior Lenders shall receive payment in full in cash of all
amounts due on or to become due on or in respect of all CR Senior Obligations
(including, without limitation, any fees, costs and interest accruing thereon at
the rate provided in the CR Senior Credit Agreement after the commencement of
any such Insolvency Proceeding, whether or not such fees, costs and interests
are allowed as a claim against the Company and/or any Guaranty in such
Insolvency Proceeding) before the BH/PIK Senior Lenders receive or accept any
payment or distribution, whether by setoff, exercising contractual or statutory
rights or otherwise, and whether in the form of cash, stock, property or
otherwise, on account of the BH/PIK Obligations; PROVIDED, HOWEVER, that subject
to Section 2.3B hereof, nothing set forth in this clause shall be deemed to
restrict or limit in any way, the rights of the BH Senior Lenders to receive Net
Proceeds of the BH First Priority Collateral received pursuant to any Permitted
Enforcement Action and/or any BH First Priority Collateral Sale (collectively,
the "BH FIRST PRIORITY COLLATERAL PROCEEDS");
(b) any payment, transfer or other distribution of assets of the
Company (or of any Subsidiary Guarantor other than a BH Guarantor in respect of
BH First Priority Collateral) of any kind or character, whether in the form of
cash, property, securities or otherwise, by setoff, exercising contractual or
statutory rights or otherwise (other than BH First Priority Collateral Proceeds
to the BH Senior Agent), to which the BH/PIK Senior Lenders would be entitled
but for the provisions of this SECTION 1.2, shall be paid by the Company, the
Subsidiary Guarantor or the liquidating trustee or agent or other person making
such payment or distribution, whether a trustee in bankruptcy, a receiver or
liquidating trustee, or otherwise, directly to the CR Senior Agent on behalf of
the CR Senior Lenders; and
(c) to the extent any portion of (or payment in respect of) the CR
Senior Obligations, the BH Senior Obligations, or the Junior Subordinated
Obligations (whether by or on behalf of the Company, as proceeds of security or
enforcement of any right of setoff or otherwise) is declared to be fraudulent or
preferential, set aside or required to be paid to any receiver, trustee in
bankruptcy, liquidating trustee, agent or other similar person under any
Insolvency Proceeding or in connection with any fraudulent conveyance or similar
law, then if such payment or incurrence of such obligation is recovered by, or
paid over to, such receiver, trustee in bankruptcy, liquidating trustee, agent,
or other similar person, the CR Senior Obligations originally the BH Senior
Obligations, and/or the Junior Subordinated Obligations (or any part of any of
these respective obligations intended to be satisfied) shall be deemed to be
reinstated and outstanding as if such payment had not occurred.
Notwithstanding the foregoing provisions of this Section 1.2, (a) in
the event that the BH/PIK Lenders shall receive any payment, transfer or
distribution of assets of the Company (or of any Subsidiary Guarantor other than
a BH Guarantor in respect of BH First Priority Collateral) of any kind or
character, whether in the form of cash, property, securities or otherwise (other
than (x) the Junior Subordinated Scheduled Payments and the BH Scheduled
Payments previously paid by the Company to the extent paid in accordance with
the terms hereof, and (y) payments received by the BH Senior Agent of BH First
Priority Collateral Proceeds), before all the CR Senior Obligations have been
paid in full in cash and all commitments of the CR Senior Lenders to make
extensions of credit available to the Company have been irrevocably terminated,
then such payment or distribution shall be held in trust for the benefit of, and
be immediately paid over to, the CR Senior Agent on behalf of the CR Senior
Lender; (b) in the event that the CR Senior Agent or any CR Senior Lender shall
receive any payment, transfer or distribution of assets of the Company (or any
Guarantor) of any kind or character, whether in the form of cash, property,
securities or otherwise after all CR Senior Obligations have been paid in full
and after all commitments of the CR Senior Lenders to make extensions of credit
available to the Company have terminated, then such payment or distribution
shall be held in trust for the benefit of, and be immediately paid over to, the
BH Senior Agent on behalf of the BH Senior Lenders until BH Senior Obligations
have been paid in full and then to Junior Subordinated Trustee; (c) in the event
that the CR Senior Agent, any CR Senior Lender or the Junior Subordinated
Trustee, prior to payment in full of all BH Senior Obligations, shall receive
any Proceeds in respect of the BH First Priority Collateral, then such proceeds
shall, subject to Section 2.3 B hereof, be held in trust for the benefit of,
and be immediately paid over to, the BH Senior Agent on behalf of the BH Senior
Lenders until all BH Senior Obligations have been paid in full and then to the
CR Senior Agent; and (d) in the event that the BH Senior Agent or any BH Senior
Lender shall receive any payment, transfer or distribution of assets of the
Company (or any Guarantor) or any kind or character, whether in the form of
cash, property, securities or otherwise after all BH Senior Obligations have
been paid in full and after all commitments of the BH Senior Lenders to make
extensions of credit available to the Company have irrevocably terminated, then
such payment or distribution shall be held in trust for the benefit of and be
immediately paid over to, the Junior Subordinated Trustee until all the
Obligations under the Junior Subordinated Indenture have been paid in full.
SECTION 1.3 NO PAYMENT WHEN CR SENIOR OBLIGATIONS IN DEFAULT. In the
event that any Event of Default has occurred and is continuing under the CR
Senior Credit Agreement (a "CR Senior Default"), the BH/PIK Lenders shall not
receive or accept any BH Scheduled Payments or any Junior Subordinated Scheduled
Payments or any other payment, transfer, or distribution (other than payments
received by the BH Senior Agent or BH Senior Lenders of BH First Priority
Collateral Proceeds), whether by setoff, exercising contractual or statutory
rights or otherwise and whether in the form of cash, stock, property or
otherwise, on account of the BH Senior Obligations until the earlier to occur of
(a) such CR Senior Default having been waived in writing by the CR Senior Agent
or (b)(i) the CR Senior Obligations (including, without limitation, amounts that
have become and remain due by acceleration, together with all costs, fees and
any interest accruing thereon at the rate provided in the CR Senior Credit
Agreement) having been paid in full in cash, and (ii) all the commitments by the
CR Senior Lenders to make credit extensions available to the Company having been
terminated. Notwithstanding the foregoing, in the event that the Company shall
have made, or the BH/PIK Lenders shall have received, any payment or
distribution of assets of PHI or any of its subsidiaries of any kind or
character, whether in the form of cash, property, securities or otherwise, at
any time when prohibited by the foregoing provisions of this Section 1.3 (other
than payments received by the BH Senior Agent or BH Senior Lenders of BH First
Priority Collateral Proceeds), then in such event such payment shall be held in
trust for the benefit of, and be immediately paid over to, the CR Senior Agent
on behalf of the CR Senior Lenders.
SECTION 1.4 REMEDIES STANDSTILL. At any time while the BH/PIK Senior
Lenders are prohibited from obtaining or receiving any payment on the BH/PIK
Obligations, the BH/PIK Lenders shall not take, demand, ▇▇▇ for, accelerate or
commence any remedial proceeding with respect to any amount that is payable on
account of the BH/PIK Obligations until (a) all of the CR Senior Obligations
have been paid in full in cash and (b) all the commitments by the CR Senior
Lenders to make credit extensions available to the Company have been terminated;
PROVIDED, HOWEVER, that (x) the BH Senior Agent may accelerate the BH Senior
Obligations and take any Permitted Enforcement Action and receive BH First
Priority Collateral Sale Proceeds and (y) any Junior Subordinated Noteholder
may take any Junior Subordinated Noteholder Permitted Action.
SECTION 1.5 WAIVER OF CERTAIN RIGHTS. No BH/PIK Lender shall (a)
require the CR Senior Agent or the CR Senior Lenders to marshal any property or
assets of the Company or of any Subsidiary Guarantor, (b) require the CR Senior
Lenders or the CR Senior Agent to enforce any guaranty or any security interest
or lien given by any Guarantor or other person to secure the payment of any or
all of the CR Senior Obligations, (c) oppose, interfere or otherwise attempt to
prevent or impair the CR Senior Lenders or the CR Senior Agent from enforcing
the security interests and liens on any CR First Priority Collateral securing
the repayment of the CR Senior Obligations, or (d) take, or permit to be taken
on its behalf, any action that is inconsistent with the terms and conditions set
forth herein. Neither the CR Senior Agent, the CR Senior Lenders, the Junior
Subordinated Trustee nor any of the Junior Subordinated Noteholders shall (i)
require the BH Senior agent or the BH Senior Lenders to marshal any property or
assets of the Company or of any Guarantor, (ii) require the BH Senior Agent or
BH Senior Lenders to enforce any guaranty or any security interest or lien given
by any BH Guarantor or other person to secure the payment of any or all of the
BH Senior Obligations, (iii) oppose, interfere or otherwise attempt to prevent
or impair the BH Senior Agent and/or the BH Senior Lenders from enforcing the
security interests on any BH First Priority Collateral securing the repayment of
the BH Senior Obligations, or (iv) take, or permit to be taken on its behalf,
any action that is inconsistent with the terms and conditions set forth herein.
Notwithstanding anything to the contrary contained in this Section 1.5, any
Junior Subordinated Noteholder may take a Junior Subordinated Permitted Action.
SECTION 1.6 [Intentionally Left Blank]
SECTION 1.7 [Intentionally Left Blank]
SECTION 1.8 PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS. The
provisions of this Agreement are and are intended solely for the purpose of
defining the relative rights of the BH Senior Agent, BH Senior Lenders, the
Junior Subordinated Noteholders, the Junior Subordinated Trustee, the CR Senior
Lenders and the CR Senior Agent. Nothing contained in this Agreement, in the
BH/PIK Credit Documents, or the CR Credit Documents or elsewhere shall impair,
as among the Company (or any Subsidiary Guarantor), or its creditors other than
the CR Senior Lenders, CR Senior Agent and the BH/PIK Lenders, the obligations
of the Company or any Subsidiary Guarantor, which are absolute and
unconditional, to pay the principal of, premium, if any, and, interest on the CR
Senior Obligations and the BH/PIK Obligations, in each case in accordance with
their respective terms.
SECTION 1.9 NO WAIVER OF SUBORDINATION PROVISIONS. No right of any
present or future CR Senior Lender or the CR Senior Agent to enforce the
provisions provided herein shall at any time be prejudiced or impaired in any
manner by (a) any act or failure to act on the part of the Company (or any
Subsidiary Guarantor) or the BH/PIK Lenders, (b) any act or failure to act by
the CR Senior Lenders or the CR Senior Agent, or (c) any noncompliance by the
Company, any Subsidiary Guarantor or the BH/PIK Lenders with the terms,
provisions and covenants of this Agreement, regardless, in each case, of any
knowledge thereof any CR Senior Lender may have or otherwise be charged with.
No right of any present or future BH Senior Lender or the BH Senior Agent to
enforce the provisions provided herein shall at any time be prejudiced or
impaired in any manner by (i) any act or failure to act on the part of the
Company (or any Subsidiary Guarantor), the Junior Subordinated Trustee, any
Junior Subordinated Noteholder, any CR Senior Lender or the CR Senior Agent,
(ii) any act or failure to act by the BH Senior Lenders or the BH Senior Agent,
or (iii) any noncompliance by the Company, any BH Guarantor, the Junior
Subordinated Trustee, any Junior Subordinated Noteholder, any CR Senior Lender
or the CR Senior Agent with the terms, provisions and covenants of this
Agreement, regardless, in each case, of any knowledge thereof the BH Senior
Agent or any BH Senior Lender may have or otherwise be charged with.
SECTION 1.10 AMENDMENTS, ETC. No provision of this Agreement may be
amended, supplemented or otherwise modified in any respect without the consent
of each party hereto affected thereby.
SECTION 1.11 SPECIFIC ENFORCEMENT.
(a) The provisions of this Agreement are intended for the benefit of,
and shall be enforceable directly by, the CR Senior Agent and the CR Senior
Lenders. The terms of this Agreement are a material inducement to the CR Senior
Lenders to make the CR Senior Obligations available to the Company. The CR
Senior Lenders would not have made the CR Senior Obligations available to the
Company without the benefit of the provisions contained in this Agreement. The
BH/PIK Lenders are receiving substantial benefits as a result of the CR Senior
Lenders making the CR Senior Obligations available to the Company.
(b) Each CR Senior Lender and the CR Senior Agent is hereby authorized
to demand specific performance of the provisions of this Agreement, whether or
not the Company shall have complied with any of the provisions hereof applicable
to it, at any time when any of the BH/PIK Lenders shall have failed to comply
with any of such provisions applicable to it. The BH/PIK Lenders may not assert
any defense based on the adequacy of a remedy at law that might be asserted as a
bar to such remedy of specific performance, it being understood that the CR
Senior Lenders will suffer irreparable harm if the terms of this Agreement are
not strictly enforced in accordance with its terms.
(c) The provisions of this Agreement are also intended for the benefit
of, and shall be enforceable directly by, the BH Senior Agent and the BH Senior
Lenders. The terms of this Agreement are a material inducement to the BH Senior
Lenders to make the BH Senior Obligations available to the Company. The BH
Senior Lenders would not have made the BH Senior Obligations available to the
Company without the benefit of the provisions contained in this Agreement. The
CR Senior Lenders and the Junior Subordinated Noteholders are receiving
substantial benefits as a result of the BH Senior Lenders making the BH Senior
Obligations available to the Company.
(d) Each BH Senior Lender and the BH Senior Agent is entitled to
specific performance of the provisions of this Agreement, whether or not the
Company shall have complied with any of the provisions hereof applicable to it,
at any time when the Junior Subordinated Trustee, any Junior Subordinated
Noteholder, the CR Senior Agent or any CR Senior Lenders shall have failed to
comply with any of such provisions applicable to it. The Junior Subordinated
Trustee, the Junior Subordinated Noteholders, the CR Senior Agent and the CR
Senior Lenders may not interpose any defense based on the adequacy of a remedy
at law that might be asserted as a bar to such remedy of specific performance,
it being understood that the BH Senior Lenders will suffer irreparable harm if
the terms of this Agreement are not strictly enforced in accordance with its
terms.
ARTICLE II
COLLATERAL ISSUES, ETC.
SECTION 2.1 REPRESENTATIONS AND WARRANTIES AS TO THIS AGREEMENT. Each
signatory to this Agreement hereby represents and warrants for itself to the
other signatories hereto that (a) it has all requisite power and authority to
execute, deliver and perform this Agreement, (b) the execution, delivery and
performance by it of this Agreement has been duly authorized by all requisite
corporate or other action, (c) no consent or approval of any other person and no
consent, license, approval or authorization of any governmental authority is
required in connection with the execution, delivery and performance by it of
this Agreement, (d) the execution, delivery and performance by it of this
Agreement does not violate the CR Senior Credit Documents, the BH/PIK Credit
Documents, the Plan, and/or the confirmation order to which it is a party, and
(e) this Agreement constitutes its legal, valid and binding obligation
enforceable against each such Intercreditor Party in accordance with its terms.
SECTION 2.2 CR FIRST PRIORITY COLLATERAL RIGHTS. Irrespective of (a)
the time, order, manner or method of creation, attachment or perfection of the
respective Liens granted by the Company to any Intercreditor Party in any or all
of the CR First Priority Collateral, (b) the time, manner or place of the filing
of the respective UCC financing statements or other applicable filings of any
Intercreditor Party with respect to any or all of the CR First Priority
Collateral, (c) any statement contained in any Credit Document, (d) any other
event, circumstance, occurrence or otherwise, or (e) any provision of any
Applicable Law to the contrary, (i) the Liens granted by the Company to the CR
Senior Agent (for and on behalf of itself and the CR Senior Lenders) in and to
the CR First Priority Collateral shall be superior and prior to any Liens
granted by the Company therein to the BH Senior Agent or the Junior Subordinated
Trustee, and (ii) the Liens granted by the Company to the BH Senior Agent for
and on behalf of the BH Senior Lenders in and to the CR First Priority
Collateral shall be superior and prior to any Liens granted by the Company
therein to the Junior Subordinated Trustee.
SECTION 2.3 A BH FIRST PRIORITY COLLATERAL RIGHTS. Irrespective of (a)
the time, order, manner or method of creation, attachment or perfection of the
Liens granted by the Company to any Intercreditor Party with respect in any or
all of the BH First Priority Collateral, (b) the time, manner or place of filing
of any mortgages or UCC financing statements or other applicable filings by any
Intercreditor Party with respect to any or all of the BH First Priority
Collateral, (c) any statement contained in any Credit Document, (d) any other
event, circumstance, occurrence or otherwise or (e) any provision of any
Applicable Law to the contrary, (i) the Liens granted by the Company to the BH
Senior Agent for and on behalf of the BH Senior Lenders in and to the BH First
Priority Collateral shall be superior and prior to any Liens granted by the
Company therein to the CR Senior Agent for and on behalf of, the CR Senior
Lenders, or to the Junior Subordinated Trustee and (ii) the Liens granted by the
Company to the CR Senior Agent (for and on behalf of itself and the CR Senior
Lenders) in and to the BH First Priority Collateral shall be superior and prior
to any Liens granted by the Company therein to the Junior Subordinated Trustee.
SECTION 2.3 B BH FIRST PRIORITY COLLATERAL SALE PROCEEDS SHORTFALL.
During the Participation Period (as defined below), upon the receipt by the BH
Senior Lenders of BH First Priority Collateral Proceeds, the BH Senior Lenders
shall concurrently purchase BH Revolver Participations in an aggregate face
amount equal to the amount of such BH First Priority Collateral Proceeds, up to
an aggregate face amount of the BH Revolver Participations not to exceed
$3,000,000. The "Participation Period" means the period of time from and after
(a) such time as the BH Senior Lenders have received BH First Priority
Collateral Proceeds equal to the sum of $22,000,000.00, plus all interest
accrued thereon under the BH Note Purchase Agreement at the [Initial Note Rate]
(as such term is defined on the BH Note Purchase Agreement), plus expenses until
(b) such time as the sum of (x) the aggregate amount of the BH First Priority
Collateral Proceeds received or retained by the Company (exclusive of any BH
Scheduled Expenses) and (y) the aggregate face amount of BH Revolver
Participations purchased by the BH Senior Lenders and/or the BH Senior Agent
equals $3,000,000. From and after the end of the Participation Period, the BH
Senior Agent and/or the BH Senior Lenders shall have no further obligation to
purchase any BH Revolver Participations.
SECTION 2.4 GUARANTY AND SUBORDINATION ACTION. (a) So long as the CR
Senior Obligations have not been paid in full or the commitments under the CR
Credit Documents have not been terminated, the CR Senior Agent shall have the
sole and exclusive right to take or fail to take any Guaranty Action with
respect to each Guaranty in any manner deemed appropriate by the CR Senior Agent
or the CR Senior Lenders in its or their sole discretion that is consistent with
the terms of each such Guaranty, and the BH/PIK Lenders shall not take any
Guaranty Action with respect to any Subsidiary Guarantor or seek to hinder,
delay, impede or seek judicial review of or jurisdiction over the method, manner
or actions of the CR Senior Agent or any CR Senior Lender in its pursuit of any
Guaranty Action with respect to each Guaranty; PROVIDED, HOWEVER, that (x) such
prohibitions and limitations shall in no way prohibit or limit or otherwise
restrict a Permitted Enforcement Action or a Junior Subordinated Noteholder
Permitted Action, and (y) until the BH Senior Obligations have been paid in
full, neither the CR Senior Agent nor any CR Senior Lender shall take any
Remedial Action against any BH Guarantor with respect to the BH First Priority
Collateral.
(b) So long as the CR Senior Obligations have not been paid in full or
the commitments under the CR Credit Documents have not been terminated, the CR
Senior Agent shall have the sole and exclusive right to take or fail to take any
Remedial Action with respect to the CR First Priority Collateral in any manner
deemed appropriate by the CR Senior Agent or the CR Senior Lenders in its or
their sole discretion (without regard to the BH/PIK Senior Lenders) that is
consistent with the terms hereof, and the BH/PIK Senior Lenders shall not take
any Remedial Action with respect to the CR First Priority Collateral or seek to
hinder, delay, impede or seek judicial review of or jurisdiction over the
method, manner or actions of the CR Senior Agent or any CR Senior Lender in its
pursuit of any Remedial Action with respect to the CR First Priority Collateral
PROVIDED, HOWEVER, that (x) such prohibitions and limitations shall in no way
prohibit or limit or otherwise restrict a Permitted Enforcement Action or a
Junior Subordinated Noteholder Permitted Action, and (y) until the BH Senior
Obligations have been paid in full, the CR Senior Agent nor any CR Senior Lender
shall take any Remedial Action against any BH Guarantor with respect to the BH
First Priority Collateral.
(c) So long as the BH Senior Obligations have not been paid in full,
the BH Senior Agent shall have the sole and exclusive right to take or fail to
take any Remedial Action with respect to the BH First Priority Collateral in any
manner deemed appropriate by the BH Senior Agent or the BH Senior Lenders in its
or their sole discretion (without regard to the CR Senior Lenders, the CR Senior
Agent, the Junior Subordinated Trustee or the Junior Subordinated Noteholders)
that is consistent with the terms hereof, and the CR Senior Lenders, the Junior
Subordinated Trustee and the Junior Subordinated Noteholders shall not take any
Remedial Action with respect to the BH First Priority Collateral, or seek to
hinder, delay, impede or seek judicial review of or jurisdiction over the
method, manner or actions of the BH Senior Agent or any BH Senior Lender in its
pursuit of any Remedial Action with respect to the BH First Priority Collateral.
SECTION 2.5 [INTENTIONALLY LEFT BLANK]
SECTION 2.6 EXCLUSIVE ENFORCEMENT RIGHTS. (a) The CR Agent and each CR
Senior Lender shall have the exclusive right to carry out, or not to carry out,
the provisions of each CR Senior Security Agreement (as each such agreement
relates to the CR First Priority Collateral, but not the BH First Priority
Collateral) and Guaranty (but not any Guaranty from a BH Guarantor), and to take
or commence any Guaranty Action or Remedial Action in connection therewith (but
not with respect to a BH Guarantor, with respect to the BH First Priority
Collateral), all in the CR Senior Agent's and each CR Senior Lender's sole
discretion and in the exercise of its and their sole business judgment (without
regard to the rights of the BH/PIK Lenders under any BH/PIK Credit Document with
respect to the CR First Priority Collateral). Such exclusive rights shall
include, specifically (but not by way of limitation) (i) the right to sell or
otherwise dispose of (or not take any such action) any or all of the CR First
Priority Collateral and to incur expenses in connection therewith, or (ii) the
right to commence or take or not commence or take any Guaranty Action (but not
with respect to a BH Guarantor, with respect to the BH First Priority
Collateral), all as may be desirable in the CR Senior Agent's and each CR Senior
Lender's sole discretion to the extent provided in the relevant CR Senior
Security Agreements (only to the extent related to the CR First Priority
Collateral) and Guaranties (but not any guaranty from a BH Guarantor), as the
case may be. In exercising its rights as aforesaid, the CR Senior Agent and each
CR Senior Lender shall not have any duties, obligations or liabilities to the
BH/PIK Lenders.
(b) The BH/PIK Lenders shall not, either directly or indirectly,
assert or exercise any Remedial Action in respect of all or any part of the CR
First Priority Collateral or any Lien thereon held by the BH/PIK Lenders or
exercise any Guaranty Action (other than with respect to a BH Guarantor with
respect to the BH First Priority Collateral) with respect to the CR First
Collateral. The BH/PIK Lenders shall not take or receive from or on behalf of
the Company, directly or indirectly, in cash or other property or by setoff or
in any other manner (whether pursuant to any enforcement, collection, execution,
levy or foreclosure proceeding or otherwise) any portion of the CR First
Priority Collateral or Proceeds thereof, except as provided in SECTION 3.6
hereof. Without limiting the generality of the foregoing, until the CR Senior
Obligations have been paid in full, the sole right of the BH/PIK Lenders (i)
with respect to the CR First Priority Collateral is to hold a Lien thereon
granted pursuant to the BH/PIK Security Agreements and not take, exercise or
commence any Remedial Action with respect thereto and (ii) with respect to each
Subordinated Guaranty (other than from a BH Guarantor), to hold the same and not
take, exercise or commence any Guaranty Action with respect thereto except as
provided in SECTION 3.6 hereof.
(c) The BH Senior Agent and each BH Senior Lender shall have the
exclusive right to carry out, or not to carry out, the provisions of each BH
Senior Security Agreement (as each such agreement relates to the BH First
Priority Collateral but not the CR First Priority Collateral) and to take or
commence or any Permitted Enforcement Action in connection therewith, all in the
BH Senior Agent's sole discretion and in the exercise of its sole business
judgment (without regard to the rights of the CR Senior Agent, the CR Senior
Lenders, the Junior Subordinated Trustee or the Junior Subordinated Lenders
under any of their respective Credit Documents). Such exclusive rights shall
include, specifically (but not by way of limitation) the right to sell or
otherwise dispose of (or not take any such action), any or all of the BH First
Priority Collateral and to incur expenses in connection therewith, all as may be
desirable in the BH Senior Agent's sole discretion to the extent provided in the
BH Senior Security Agreements (only to the extent related to the BH First
Priority Collateral). In exercising its rights as aforesaid, the BH Senior Agent
and the BH Senior Lenders shall not have any duties, obligations or liabilities
to any of the CR Senior Agent, the CR Senior Lenders and the Junior Subordinated
Trustee.
(d) None of the CR Senior Agent, the CR Senior Lenders, the Junior
Subordinated Trustee and the Junior Subordinated Noteholders shall, either
directly or indirectly, assert or exercise any Remedial Action in respect of all
or any part of the BH First Priority Collateral or any Lien thereon held by such
party or exercise any Guaranty Action with respect to a BH Guarantor in
connection therewith. Each of the CR Senior Agent, the CR Senior Lenders, the
Junior Subordinated Trustee and the Junior Subordinated Noteholders agrees not
to take or receive from or on behalf of the Company, directly or indirectly, in
cash or other property or by setoff or in any other manner (whether pursuant to
any enforcement, collection, execution, levy or foreclosure proceeding or
otherwise) any portion of the BH First Priority Collateral or proceeds thereof,
except as provided in SECTIONS 2.3 B and 3.6 hereof. Without limiting the
generality of the foregoing, the sole right of each of the CR Senior Agent, the
CR Senior Lenders and the Junior Subordinated Trustee with respect to the BH
First Priority Collateral is to hold a Lien thereon granted pursuant to the CR
Senior Security Agreements or the Junior Subordinated Security Agreements, as
the case may be, and not exercise any Remedial Action with respect thereto or
exercise any Guaranty Action with respect to a BH Guarantor.
ARTICLE III
OTHER AGREEMENTS
[SECTION 3.1 RELEASES].
(a) If the CR Senior Agent or any CR Senior Lender releases any Lien
on any part of the CR First Priority Collateral in connection with any sale,
lease, exchange, transfer or other disposition thereof in accordance with the
terms of the CR Credit Documents (not involving any Remedial Action or Guaranty
Action), the Liens of the BH Senior Agent shall be automatically and
unconditionally and simultaneously released and the Liens of the Junior
Subordinated trustee shall be released upon satisfaction of the applicable
conditions of Article 10 of the Junior Subordinated Indenture. The BH/PIK
Lenders shall execute and deliver to PHI and the CR Senior Agent such
termination statements, releases and other documents as the CR Senior Agent, the
CR Senior Lenders or the Company may reasonably request to effectively confirm
such release. All such disposition proceeds shall be applied as provided in the
CR Senior Credit Agreement. Notwithstanding the foregoing, the CR Senior Agent
shall notify the BH Senior Agent and the Junior Subordinated Trustee at least
three (3) business days before entry of such proposed sale, lease, exchange,
transfer or other disposition.
(b) Subject to the provisions of Section 2.3 B hereof, if the BH
Senior Lender releases any Lien on any part of the BH First Priority Collateral
in connection with any sale, lease, exchange, transfer or other disposition
thereof in accordance with the terms of the BH Note Purchase Documents (not
involving any Remedial Action or Guaranty Action), the Liens of the CR Senior
Agent, and the CR Senior Lenders, and the Junior Subordinated Trustee shall be
automatically and unconditionally and simultaneously released and the CR Senior
Agent, the CR Senior Lenders, the Junior Subordinated Trustee shall execute and
deliver to the Company and the BH Senior Agent such termination statements,
releases and other documents as the BH Senior Agent or the Company may
reasonably request to effectively confirm such release. Subject to the
provisions of Sections 2.3 B hereof, all such disposition proceeds shall be
applied as provided in the BH Note Purchase Agreement. Notwithstanding the
foregoing, the BH Senior Lenders shall notify the CR Senior Agent and the Junior
Subordinated Trustee at least three (3) business days before entry of such
proposed sale, lease, exchange, transfer or other disposition, and the CR Senior
Agent shall have been provided the opportunity to purchase the Collateral to be
sold, leased, exchanged, transferred or otherwise disposed of on terms more
favorable to PHI than those offered as aforesaid.
SECTION 3.2 INSURANCE AND CONDEMNATION AWARDS.
(a) The CR Senior Agent and the CR Senior Lenders shall have the sole
and exclusive right as among the Intercreditor Parties to adjust, settle, direct
or otherwise deal with any insurance Proceeds with respect to the CR First
Priority Collateral in the event of any loss thereunder and to approve any award
granted in any condemnation or similar proceeding in respect of the CR First
Priority Collateral.
(b) Nothwithstanding the designation of any Person as an additional
insured or a loss payee on any policy of insurance with respect to any
Intercreditor Collateral, all the Proceeds of any insurance policies and any
awards relating to the CR First Priority Collateral shall (i) first, be paid
exclusively to the CR Senior Agent and applied as provided in the CR Senior
Credit Agreement, and the BH/PIK Lenders shall have no right, title or interest
therein and (ii) second, after all amounts owing under the CR Credit Documents
have been paid in full and the obligations of the CR Senior Agent and the CR
Senior Lenders have been terminated, as provided in SECTION 3.6, and if a party
that is not entitled to receive the same under this provision shall nonetheless
receive any of the same, such party shall hold the same in trust for, and shall
immediately pay the same over to the party that is entitled to the same.
(c) The BH Senior Agent shall have the sole and exclusive right as
among the Intercreditor Parties to adjust, settle, direct or otherwise deal with
any insurance Proceeds with respect to the BH First Priority Collateral in the
event of any loss thereunder and to approve any award granted in any
condemnation or similar proceeding in respect of the BH First Priority
Collateral.
(d) Notwithstanding the designation of any Person as an additional
insured or a loss payee on any policy of insurance with respect to any
Intercreditor Collateral, subject to the provisions of SECTION 2.3 B hereof, all
the Proceeds of any insurance policies and any awards relating to the BH First
Priority Collateral shall (i) first, be paid exclusively to the BH Senior Lender
and applied as provided in the BH Note Purchase Agreement, and none of the CR
Senior Agent, the CR Senior Lenders, the Junior Subordinated Trustee and the
Junior Subordinated Noteholders shall have any right, title or interest therein
and (y) second, after all amounts owing under the BH Senior Note Documents have
been paid in full and the obligations of the BH Senior Agent and the BH Senior
Lenders have been terminated, as provided in SECTION 3.6 hereof, and if a party
that is not entitled to receive the same under this provision shall nonetheless
receive any of the same, such party shall hold the same in trust for, and shall
immediately pay the same over to the party that is entitled to the same.
SECTION 3.3 NO ADDITIONAL OBLIGATIONS.
(a) The CR Senior Agent and the CR Senior Lenders will be entitled to
manage and supervise the CR Senior Obligations and the CR Credit Documents in
accordance with their sole and absolute discretion, without regard to any of the
rights or interests of the BH/PIK Lenders (but subject to the terms and
conditions of this Agreement).
(b) The BH Senior Agent and the BH Senior Lenders will be entitled to
manage and supervise the BH Senior Obligations and the BH Senior Note Documents
in accordance with their sole and absolute discretion, without regard to any of
the rights or interest of the CR Senior Agent, the CR Senior Lenders, the Junior
Subordinated Trustee (but subject to the terms and conditions of this
Agreement).
(c) (i) The CR Senior Agent and the CR Senior Lenders shall have no
obligation whatsoever to the BH/PIK Lenders to assure the ownership, existence
or genuineness of any CR First Priority Collateral. The CR Senior Agent and the
CR Senior Lenders shall have no obligation whatsoever to the BH/PIK Lenders to
preserve their rights or benefits in any of the CR First Priority Collateral,
and (ii) the BH Senior Agent and the BH Senior Lenders shall have no obligation
whatsoever to any of the CR Senior Agent, the CR Senior Lenders, the Junior
Subordinated Trustee or the Junior Subordinated Noteholders to assure the
ownership, existence or genuineness of any BH First Priority Collateral. The BH
Senior Agent and the BH Senior Lenders shall have no obligation whatsoever to
the CR Senior Agent, the Cr Senior Lenders, the Junior Subordinated Trustee or
the Junior Subordinated Noteholders to preserve their rights or benefits in any
of the BH First Priority Collateral.
SECTION 3.4 WAIVERS.
(a) (i) No right of the CR Senior Agent or any CR Senior Lender to
enforce the subordination with respect to any CR First Priority Collateral or
take Remedial Action in connection with the CR First Priority Collateral,
exercise any Guaranty Action in respect of the Guaranties, in each case as
provided in this Agreement, shall in any manner be prejudiced or impaired by any
act or failure to act on the part of the Company, or the CR Senior Agent or any
CR Senior Lender, or by any noncompliance by any person with the terms,
provisions and covenants of this Agreement, any of the CR Credit Documents or
any of the BH/PIK Credit Documents, regardless of any knowledge thereof which
the CR Senior Agent or any CR Senior Lender may have or be otherwise charged
with, and (ii) no right of the BH Senior Agent and the BH Senior Lenders to
enforce the subordination with respect to any BH First Priority Collateral or
take Remedial Action in connection with the BH First Priority Collateral or
exercise any Guaranty Action with respect to a BH Guarantor as provided in this
Agreement, shall in any manner be prejudiced or impaired by any act or failure
to act on the part of the Company, or the BH Senior Agent or any BH Senior
Lender, or by any noncompliance by any person with the terms, provisions and
covenants of this Agreement or any of the BH/PIK Credit Documents or CR Credit
Documents, regardless of any knowledge thereof which the BH Senior Agent or any
BH Senior Lender may have or be otherwise charged with.
(b) (i) To the fullest extent permitted by law, none of the BH/PIK
Lenders shall have any claim it may have against the CR Senior Agent or any CR
Senior Lender (including, without limitation, any such claims under Sections
9-207, 9-506 and 9-507 of the UCC) arising out of or with respect to any action
which the CR Senior Agent or any CR Senior Lender may take or permit or omit to
take with respect to the Intercreditor Collateral pursuant to, and in accordance
with the terms of, this Agreement and (ii) to the fullest extent permitted by
law, none of the CR Senior Agent, the CR Senior Lenders, the Junior Subordinated
Trustee, and the Junior Subordinated Noteholders shall have any claim against
the BH Senior Agent and any BH Senior Lender (including, without limitation, any
such claims under Sections 9-207, 9-506 and 9-507 of the UCC) arising out of or
with respect to any action which the BH Senior Agent or any BH Senior Lender may
take or permit or omit to take with respect to the Intercreditor Collateral
pursuant to, and in accordance with the terms of, this Agreement.
(c) (i) With respect to the CR First Priority Collateral, to the
fullest extent permitted by law, the BH/PIK Lenders shall not assert any right
to demand, request, plead or otherwise assert or otherwise claim the benefit of,
any marshalling, appraisement, valuation or other similar right that may
otherwise be available under any Applicable Law or any other similar rights a
junior secured creditor may have under any Applicable Law, and (ii) to the
fullest extent permitted by law, with respect to the BH First Priority
Collateral, the CR Senior Agent, the CR Senior Lenders, the Junior Subordinated
Trustee and the Junior Subordinated Noteholders shall not assert, any right to
demand, request, plead or otherwise assert or otherwise claim the benefit of,
any marshalling, appraisement, valuation or other similar right that may
otherwise be available under any Applicable Law or any other similar rights a
junior secured creditor may have under any Applicable Law.
SECTION 3.5 INFORMATION CONCERNING PHI, ETC. Each Intercreditor Party
shall be responsible for keeping itself informed of (a) the financial condition
of PHI, the Obligors and all endorsers and/or Guarantors of the BH/PIK
Obligations or the CR Senior Obligations, as the case may be, and (b) all other
circumstances bearing upon the risk of nonpayment of the BH/PIK Obligations or
the CR Senior Obligations, as the case may be. No Intercreditor Party shall have
any present or future duty or responsibility to any other Intercreditor Party to
advise them of information known to it regarding the financial condition of PHI
or any other Obligor or of any circumstances bearing upon the risk of nonpayment
of the BH/PIK Obligations or the CR Senior Obligations, as the case may be.
SECTION 3.6 APPLICATION OF PAYMENTS.
(a) All proceeds arising from any Remedial Action with respect to any
CR First Priority Collateral or any Guaranty Action with respect to any CR First
Priority Collateral shall be applied, FIRST, to the payment of the CR Senior
Obligations until they have been paid in full in cash, SECOND, to the payment of
the BH Senior Obligations until they have been paid in full in cash, and THIRD,
to the payment of the Junior Subordinated Obligations until this Agreement is
terminated.
(b) Except as otherwise provided in SECTION 2.3 B hereof, all Proceeds
arising from any Remedial Action with respect to any BH First Priority
Collateral shall be applied, FIRST, to the payment of the BH Senior Obligations
until they have been paid in full in cash, SECOND, to the payment of the CR
Senior Obligations until they have been paid in full in cash, and THIRD, to the
payment of the Junior Subordinated Obligations until this Agreement is
terminated.
SECTION 3.7 INDEPENDENT DECISIONS. Each Intercreditor Party has,
independently and without reliance on any other Intercreditor Party, and in
reliance upon information supplied to it by the Company and upon such other
information as it has deemed appropriate, has made its own independent decision
to enter into the Credit Documents and to make the extensions of credit
contemplated thereunder; and each Intercreditor Party shall, independently and
without reliance upon any other Intercreditor Party, continue to make its own
independent analysis and decisions in acting or not acting under such Credit
Documents and this Agreement.
SECTION 3.8 TURNOVER OF PROHIBITED TRANSFERS. If any amount is
received by any signatory to this Agreement in violation of the terms of this
Agreement, such amount shall, without the necessity of demand or request by any
other Intercreditor Party, be delivered forthwith by such signatory to the
applicable Intercreditor Party entitled to receive the same for application to
payment of the CR Senior Obligations or BH/PIK Obligations, as the case may be,
in the form received, except for the addition of any endorsement or assignment
necessary to effect a transfer of all rights therein to such other party. Until
so delivered, any such amount shall be deemed received and held by the relevant
signatory in trust for the Intercreditor Party entitled to receive the same and
shall not be commingled with other funds or property of such Intercreditor
Party. Notwithstanding anything to the contrary in the prior two sentences of
this Section 3.8, the Junior Subordinated Trustee shall not be charged with
knowledge of the existence of any facts (other than the terms and conditions of
this Agreement) which would prohibit the making of any payment to or by the
Junior subordinated Trustee unless and until the Junior Subordinated Trustee
shall have received, no later than [2] business days prior to any such payment,
written notice from an Intercreditor Party of an Event of Default under either
the CR Credit Documents or the BH Senior Note Documents or such other notice
(i.e. of a Remedial Action) as may be reasonable to place the Junior
Subordinated Trustee on notice of any such prohibited payment; unless the Junior
subordinated Trustee shall have received such notice, it shall have full power
and authority to receive such payment and to apply the same as required by the
Junior Subordinated Indenture.
SECTION 3.9 EFFECTIVENESS DURING INSOLVENCY PROCEEDING. This Agreement
shall continue in full force and effect notwithstanding any Insolvency
Proceeding.
SECTION 3.10 AMENDMENTS. The Company shall not, and shall not permit
any subsidiary or Guarantor to, and no Intercreditor Party shall amend,
supplement or otherwise modify, without the consent of each other Intercreditor
Party, the terms of any of the Credit Documents to which it is a party, or enter
into any other agreement having the effect of doing so, in a manner that (a) is
inconsistent in any respect with the terms of this Agreement, or (b) increases
or expands the scope of the Intercreditor Collateral. Other than the CR Senior
Lenders or the CR Senior Agent, no Intercreditor Party shall be entitled to a
first priority Lien on any now or hereafter acquired property of the Company or
any its subsidiaries (except for the first priority Liens of the BH Senior Agent
and the BH Senior Lenders with respect to the BH First Priority Collateral). In
addition, the Legend shall not be amended or modified in any respect.
SECTION 3.11 LIMITATION ON DECLARING DEFAULTS. Notwithstanding the
occurrence of any fact or circumstance that may result in any default or event
of default under any Junior Subordinated Credit Document, the Junior
Subordinated Trustee shall not declare any default or event of default
thereunder. In addition, neither the Junior Subordinated Trustee nor any of the
Junior Subordinated Noteholders shall join in any involuntary Insolvency
Proceeding against PHI or any Obligor.
SECTION 3.12 DURATION AND TERMINATION; PAYMENT INVALIDATED.
(a) This Agreement shall constitute a continuing agreement and shall
terminate with respect to the CR Senior Agent and the CR Senior Lenders only
upon written notice by the CR Senior Agent to PHI, the BH Senior Agent, and the
Junior Subordinated Trustee of the indefeasible payment in full in cash of all
of the CR Senior Obligations and the termination of the CR Credit Documents
(such written notice the CR Senior Agent agrees to give promptly, and, in any
event, within three (3) business days, after the occurrence of the foregoing).
The termination of this Agreement with respect to the CR Senior Agent and the CR
Senior Lenders shall, subject to CLAUSE (C) of this Section 3.12, release fully
and irrevocably such persons from any and all liabilities, duties and
responsibilities hereunder to the same extent as if this Agreement had been
fully terminated by all the parties hereto, PROVIDED, HOWEVER, that the
foregoing shall not release any of the parties with respect to any obligations
arising prior to such termination.
(b) This Agreement shall constitute a continuing agreement and shall
terminate with respect to the BH Senior Agent and the BH Senior Lenders only
upon written notice by the BH Senior agent to PHI, the CR Senior Agent and the
Junior Subordinated Trustee of the payment in full in cash of all of the BH
Senior Obligations and the termination of the BH Credit Documents (such written
notice the BH Senior Agent agrees to give promptly, and, in any event, within
three (3) business days after the occurrence of the foregoing). The termination
of this Agreement with respect to the BH Senior Agent and the BH Senior Lenders
shall, subject to clause (c) of this Section 3.12, release fully and irrevocably
such persons from any and all liabilities, duties, responsibilities hereunder to
the same extent as if this Agreement had been fully terminated by all parties
hereto; PROVIDED, HOWEVER, that the foregoing shall not release any of the
parties with respect to any obligations arising prior to such termination.
(c) In the event that this Agreement is terminated with respect to (i)
the CR Senior Agent and the CR Senior Lenders, as provided in CLAUSE (a), (ii)
the BH Senior Agent and the BH Senior Lenders, as provided in clause (b), of
this Section 3.12, and the CR Senior Agent, any CR Senior Lender, the BH Senior
Agent or any BH Senior Lender shall be required by a court or other tribunal of
competent jurisdiction to disgorge, refund, rebate or otherwise return any
amount received with respect to any of the Intercreditor Collateral, any
Guaranty to any debtor-in-possession or trustee in respect of any Insolvency
Proceeding, or any other person (whether as the result of such payment
constituting, or being alleged to constitute, a preference, a fraudulent
conveyance or any other payment required to be disgorged pursuant to any such
Insolvency Proceeding) then, in any such event, (i) the terms and conditions of
this Agreement shall be reinstated, notwithstanding any prior termination of
this Agreement pursuant to this Section 3.12, and (ii) all provisions of this
Agreement shall once again be operative until all such CR Senior Obligations
and/or BH Senior Obligations, as the case may be, are again paid in full in
cash.
(d) If both the BH Senior Obligations and Junior Subordinated
Obligations are outstanding at the time this Agreement is terminated with
respect to the CR Senior Agent and the CR Senior Lenders, the BH/PIK Lenders
shall continue to be subject to this Agreement with respect to the Intercreditor
Collateral on the same terms as provided in this Agreement immediately prior to
such termination with respect to the CR Senior Agent and the CR Senior Lenders,
except that (i) all references to the CR Senior Agent, the CR Senior Lenders and
the BH Senior Agent and BH Senior Lenders shall refer to the BH Senior Agent and
the BH Senior Lenders, and (ii) this Agreement shall be interpreted as if there
were two classes of Intercreditor Parties, with the CR Senior Agent, CR Senior
Lenders, the BH Senior Agent and the BH Senior Lenders being, collectively, the
senior class, and the Junior Subordinated Trustee and the Junior Subordinated
Noteholders being the junior class (it being understood and agreed that, to the
extent the BH Senior Agent or BH Senior Lenders are prohibited from taking any
action hereunder as it relates to the CR Senior Agent and the CR Senior Lenders,
such provisions shall be null and void as it relates to the BH Senior Agent and
BH Senior Lenders).
(e) In connection with the termination of this Agreement with respect
to the CR Senior Agent and the CR Senior Lenders, the CR Senior Agent shall
transfer the possession to the BH Senior Agent (if the BH Senior Obligations are
outstanding) or the Junior Subordinated Trustee (if the Junior Subordinated
Obligations are outstanding but no BH Senior Obligations are outstanding) any
Intercreditor Collateral it holds as bailee for the BH/PIK Lenders under Section
3.15 hereof. No such transfer shall be taken in violation of any applicable law,
rule or regulation or court order, and shall be taken at the sole cost and
expense of the Company. All such transfers shall be done without any
representation or warranty by the CR Senior Agent or the CR Senior Lenders and
on an "as is, where is" basis, and none of the CR Senior Agent and the CR Senior
Lenders shall have any liability with respect thereto.
SECTION 3.13 NOTICE OF BH/PIK LENDERS INTERESTS. This Agreement
constitutes a written notification of demand to the CR Senior Agent by the
BH/PIK Lenders for the satisfaction of the indebtedness outstanding under the
BH/PIK Credit Documents that are secured by the Intercreditor Collateral for the
purposes of Section 9-504(1)(c) of the UCC, and the CR Senior Agent hereby
waives any rights that it might otherwise have under said Section to require the
BH/PIK Lenders to file any proof of their interest in the Intercreditor
Collateral.
SECTION 3.14 CREDIT DOCUMENTS. Each signatory to this Agreement hereby
confirms that it has delivered to the other signatories true and complete copies
of its Credit Documents, in each case as in effect on the date hereof, and all
UCC financing statements and other filings to perfect its security interest in
the Intercreditor Collateral.
SECTION 3.15 BAILEE FOR PERFECTION. For purposes of the UCC, each
BH/PIK Lender hereby appoints the CR Senior Agent as bailee for the BH/PIK
Lenders (and by its execution hereof the CR Senior Agent accepts such
appointment) to hold on their behalf all the instruments, certificates and
Proceeds forming a part of the Intercreditor Collateral solely for the purpose
of perfecting its Liens in the same pursuant to the BH/PIK Security Agreements,
subject to the terms and conditions of this Agreement. Neither the CR Senior
Agent nor any CR Senior Lender shall have by reason of this Agreement or any
other document a fiduciary relationship in respect of the BH/PIK Lenders, nor
shall the CR Senior Agent or any CR Senior Lender incur any liabilities of any
kind whatsoever to the BH/PIK Lenders by virtue of it acting as bailee on behalf
of the BH/PIK Lenders, other than to use commercially reasonable efforts to
maintain and keep secure such Intercreditor Collateral and to pay or deliver the
same to the parties entitled thereto in accordance herewith.
SECTION 3.16 LEGEND. Each of the CR Senior Credit Agreement, the BH
Note Purchase Agreement, the Junior Subordinated Indenture, and each Security
Agreement and any notes or other evidences of indebtedness in connection
therewith shall contain a legend which shall read as follows:
THIS AGREEMENT IS SUBJECT TO AN INTERCREDITOR AND SUBORDINATION
AGREEMENT DATED AS OF MARCH __, 2000 BY AND AMONG THE CIT
GROUP/BUSINESS CREDIT, INC., AS AGENT, WILMINGTON TRUST COMPANY, AS
AGENT, AND THE UNITED STATES TRUST COMPANY OF NEW YORK, AS JUNIOR
SUBORDINATED TRUSTEE (THE "INTERCREDITOR AGREEMENT", WHICH MATERIALLY
AFFECTS CERTAIN PAYMENT RIGHTS, SUBORDINATES CERTAIN OBLIGATIONS AND
CERTAIN SECURITY INTERESTS AND LIENS, AND LIMITS RIGHTS TO
ENFORCEMENT OF THE PARTIES TO THIS AGREEMENT. ALL PERSONS OR OTHER
ENTITIES WHICH AT ANY TIME HOLD INDEBTEDNESS HEREUNDER OR WHICH IS
SECURED HEREBY ARE BOUND BY THE TERMS OF THE INTERCREDITOR
AGREEMENT, WHICH WILL BE MADE AVAILABLE UPON REQUEST.
SECTION 3.17 JUNIOR SUBORDINATED TRUSTEE: POWER OF ATTORNEY; AGREEMENT
TO COOPERATE. The CR Senior Agent and the CR Senior Lenders (or any and all
representatives thereof) are hereby irrevocably appointed and empowered to
demand, ▇▇▇ for, collect and receive every such payment or distribution to which
such Junior Subordinated Noteholders are entitled and give acquittance therefor,
and to file claims and proofs of claim in any statutory or non-statutory
proceeding, to vote such claim in any such proceeding, and to take any and all
such other actions, in their own name as the CR Senior Agent or CR Senior
Lenders, or in the name of such Junior Subordinated Noteholders or otherwise, as
the CR Senior Agent and the CR Senior Lenders (or their respective
representatives) may deem necessary or advisable in its sole discretion for the
enforcement of the provisions of this Agreement and for the satisfaction and
payment in full of the CR Senior Obligations. The Junior Subordinated
Noteholders shall, duly and promptly take such action as may be requested at any
time and from time to time by the CR Senior Agent and the CR Senior Lenders (or
their respective representatives), to file appropriate proofs of claim in
respect of the Junior Subordinated Obligations, and to execute and deliver such
powers of attorney, assignments of proofs of claim or other instruments as may
be requested by the CR Senior Agent and the CR Senior Lenders (or their
respective representatives), in order to enable the CR Senior Lender to enforce
any and all claims upon or in respect of the Junior Subordinated Obligations and
to collect and receive any and all payments or distributions which may be
payable or deliverable at any time upon or in respect of the Junior Subordinated
Obligations.
SECTION 3.18 BH SENIOR LENDERS: POWER OF ATTORNEY; AGREEMENT TO
COOPERATE. The BH Senior Agent and each of the BH Senior Lenders irrevocably
authorizes and empowers the CR Senior Agent and the CR Senior Lenders (or their
respective representatives) to demand, ▇▇▇ for, collect and receive every such
payment or distribution to which the BH Senior Lender is entitled from the
proceeds of the CR First Priority Collateral (the "CR COLLATERAL PROCEEDS") and
give acquittance therefor, and to file claims and proofs of claim in any
statutory or non-statutory proceeding, to vote such claim in any such
proceeding, and to take such other actions, in their own name as the CR Senior
Agent or the CR Senior Lenders, or in the name of the BH Senior Lender or
otherwise, as the CR Senior Agent and the CR Senior Lenders (or their respective
representatives) may deem necessary or advisable for the enforcement of the
provisions of this Agreement. The BH Senior Agent and the BH Senior Lenders
hereby agree, duly and promptly to take such action as may be requested at any
time and from time to time by the CR Senior Agent and CR Senior Lenders (or
their respective representatives), to file appropriate proofs of claim in
respect of the BH Senior Obligations, and to execute and deliver such powers of
attorney, assignments of proofs of claim or other instruments as may be
requested by the CR Senior Agent and the CR Senior Lenders (or their respective
representatives), in order to enable the CR Senior Lenders to enforce any and
all claims upon or in respect of the CR Senior Obligations and to collect and
receive any and all payments or distributions which may be payable or
deliverable at any time upon or in respect of the CR Senior Obligations from the
CR Collateral Proceeds.
SECTION 3.19 CR SENIOR LENDERS/JUNIOR SUBORDINATED LENDERS: POWER OF
ATTORNEY; AGREEMENT TO COOPERATE. BH Senior Agent and the BH Senior Lenders (or
their respective representatives) are hereby irrevocably appointed and empowered
to demand, ▇▇▇ for, collect and receive every such payment or distribution to
which the CR Senior Lenders, the CR Senior Agent, the Junior Subordinated
Noteholders or the Junior Subordinated Trustee are entitled from the BH First
Priority Collateral Proceeds and give acquittance therefor, and to file claims
and proofs of claim in any statutory or non-statutory proceeding, to vote such
claim in any such proceeding, and to take such other actions, in their own name
as the BH Senior Agent or the BH Senior Lenders, or in the name of the CR Senior
Lenders, the CR Senior Agent, the Junior Subordinated Trustee or any Junior
Subordinated Lender or otherwise, as the BH Senior Agent and the BH Senior
Lenders (or their respective representatives) may deem necessary or advisable
for the enforcement of the provisions of this Agreement, in each case, solely,
with respect to BH First Priority Collateral Proceeds. The CR Senior Agent, the
CR Senior lenders, the Junior Subordinated Trustee and the Junior Subordinated
Noteholders shall, duly and promptly to take such action as may be requested at
any time and from time to time by the BH Senior Agent and BH Senior Lender (or
their respective representatives), to file appropriate proofs of claim in
respect of the CR Senior Obligations and/or the Junior Subordinated Obligations,
and to execute and deliver such powers of attorney, assignments of proofs of
claims or other instruments as may be requested by the BH Senior Agent and the
BH Senior Lenders (or their respective representatives), in order to enable the
BH Senior Lender to enforce any and all claims upon or in respect of the BH
Senior Obligations and to collect and receive any and all payments or
distributions which may be payable or deliverable at any time upon or in respect
of the BH Senior Obligations from the BH First Priority Collateral Proceeds.
ARTICLE IV
MISCELLANEOUS
SECTION 4.1 CONFLICT. In the event of any conflict between the terms
of any Credit Document and the terms of this Agreement, the terms of this
Agreement shall control.
SECTION 4.2 NO THIRD PARTY BENEFIT, ETC. This Agreement is entered
into for the benefit of the parties hereto and their respective successors and
assigns only and no benefit shall accrue or is intended with respect to any
third party, including, without limitation, any trustee in bankruptcy for PHI or
any other Obligor.
SECTION 4.3 AMENDMENTS AND WAIVERS. All modifications, amendments or
waivers of any of the terms or provisions of this Agreement shall be in writing
and duly executed by a duly authorized officer of each of the parties to this
Agreement.
SECTION 4.4 SUCCESSORS AND ASSIGNS. All the covenants, terms and
agreements in this Agreement shall bind and inure to the benefit of the
respective successors and assigns of PHI, the other Obligors, the Noteholders
and the Intercreditor Parties.
SECTION 4.5 PARTIAL INVALIDITY. The unenforceability or invalidity of
any provision or provisions of this Agreement shall not render any other
provision or provisions herein contained unenforceable or invalid.
SECTION 4.6 COMMUNICATIONS. All communications between or among the
Intercreditor Parties provided for herein shall be in writing and via overnight
delivery or telecopier, and shall be deemed to have been given: (a) when
delivered, if delivered personally or by overnight delivery service; (b) when
delivered, if delivered by the United States mail, postage prepaid, with return
receipt requested; or (c) if delivered by telecopier transmissions, upon receipt
of confirmation of transmission thereof by the sender thereof, addressed, in
each case, at the address of each party set forth below or such other address as
such party may designate by notice duly given in accordance with this SECTION
4.6 to the other parties hereto:
IF TO THE CR SENIOR AGENT:
--------------------------
CIT Group/Business Group, Inc., as Agent for the Lenders to
Planet Hollywood
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Rothschild Recovery Fund, L.P.
1251 Avenue of the ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
IF TO THE BH SENIOR AGENT:
Wilmington Trust Company
▇▇▇▇▇▇ Square North
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: Corporate Trust Administration
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Bay Harbour Management L.C.
---------------------------
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
IF TO THE JUNIOR SUBORDINATED TRUSTEE
United States Trust Company of New York
Corporate Trust & Agency Division
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
Attention: Corporate Trust Administration
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
SECTION 4.7 GOVERNING LAW; CONSENT TO JURISDICTION. THIS AGREEMENT
SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE INTERNAL LAWS OF THE
STATE OF NEW YORK (WITHOUT REGARD TO ANY CONFLICTS-OF-LAW PRINCIPLES).
SECTION 4.8 FORUM SELECTION AND CONSENT TO JURISDICTION. ANY
LITIGATION BASED ON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS
AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL
OR WRITTEN) OR ACTIONS OF ANY PARTY TO THIS AGREEMENT, SHALL BE BROUGHT AND
MAINTAINED EXCLUSIVELY IN THE FEDERAL OR STATE COURTS OF NEW YORK LOCATED IN THE
BOROUGH OF MANHATTAN; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT
AGAINST ANY INTERCREDITOR COLLATERAL MAY BE BROUGHT IN THE COURTS OF ANY
JURISDICTION WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND. EACH
SIGNATORY HERETO HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO THE JURISDICTION OF
SUCH COURTS FOR THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH ABOVE AND
IRREVOCABLY AGREES TO BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION
WITH SUCH LITIGATION. EACH SIGNATORY HERETO FURTHER IRREVOCABLY CONSENTS TO THE
SERVICE OF PROCESS BY REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE
WITHIN OR WITHOUT THE STATE OF NEW YORK. EACH SIGNATORY HERETO HEREBY EXPRESSLY
AND IRREVOCABLY WAIVES, TO THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION
WHICH IT MAY HAVE OR HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH
LITIGATION BROUGHT IN ANY SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY
SUCH LITIGATION HAS BEEN BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT
ANY SIGNATORY HERETO HAS OR HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION
OF ANY COURT OF FROM ANY LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE,
ATTACHMENT PRIOR TO JUDGMENT, ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH
RESPECT TO ITSELF OR ITS PROPERTY, SUCH SIGNATORY HEREBY IRREVOCABLY WAIVES SUCH
IMMUNITY IN RESPECT OF ITS OBLIGATIONS UNDER THIS AGREEMENT.
SECTION 4.9 WAIVER OF JURY TRIAL, ETC. EACH SIGNATORY HERETO HEREBY
KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHTS IT MAY HAVE TO A
TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF,
UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF ANY PARTY HERETO.
EACH SIGNATORY HERETO ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND
SUFFICIENT CONSIDERATION FOR THIS PROVISION AND THAT THIS PROVISION IS A
MATERIAL INDUCEMENT FOR EACH SIGNATORY HERETO ENTERING INTO THIS AGREEMENT.
SECTION 4.10 COUNTERPARTS. This Agreement may be executed and
delivered in any number of counterparts, each of such counterparts constituting
an original but altogether only one Agreement.
SECTION 4.11 FURTHER ASSURANCES. Each Intercreditor Party agrees to
execute such further documents and agreements as may be reasonably requested by
the other to give effect to the purposes of this Agreement.
SECTION 4.12 SPECIFIC ENFORCEMENT. EACH SIGNATORY TO THIS AGREEMENT
ACKNOWLEDGES AND AGREES THAT THE TERMS OF THIS AGREEMENT ARE A MATERIAL
INDUCEMENT TO ITS ENTERING INTO THE CREDIT DOCUMENTS IT IS A PARTY TO.
ACCORDINGLY, EACH SIGNATORY HERETO IS HEREBY AUTHORIZED TO DEMAND SPECIFIC
PERFORMANCE OF THE PROVISIONS OF THIS AGREEMENT AT ANY TIME WHEN ANY OTHER
SIGNATORY HERETO SHALL HAVE FAILED TO COMPLY WITH ANY OF THE PROVISIONS THAT ARE
APPLICABLE TO IT. EACH SIGNATORY HERETO HEREBY IRREVOCABLY WAIVES ANY DEFENSE
BASED ON THE ADEQUACY OF A REMEDY AT LAW THAT MIGHT BE ASSERTED AS A BAR TO SUCH
REMEDY OF SPECIFIC PERFORMANCE.
SECTION 4.13 ACKNOWLEDGEMENT BY PHI. By executing the acknowledgement
to this Agreement, PHI agrees, for and on behalf of itself and the other
Obligors, to all the terms hereof and shall not, either directly or indirectly,
take any action to challenge or otherwise impair in any respect the operation of
this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
THE CIT GROUP/BUSINESS CREDIT, INC.,
as CR Senior Agent
By:
----------------------------
Name:
Title:
ROTHSCHILD RECOVERY FUND, L.P.
By:
----------------------------
Name:
Title:
THE CIT GROUP/BUSINESS CREDIT, INC.
By:
----------------------------
Name:
Title:
WILMINGTON TRUST COMPANY,
as BH Senior Agent
By:
----------------------------
Name:
Title:
UNITED STATES TRUST COMPANY OF
NEW YORK, as Junior Subordinated Trustee
By:
----------------------------
Name:
Title:
[OTHER BONDHOLDERS]
ACKNOWLEDGED AND AGREED:
PLANET HOLLYWOOD INTERNATIONAL, INC.
By:
----------------------------
Name:
Title:
[SUBSIDIARY BORROWERS/SUBSIDIARY GUARANTORS]
By:
----------------------------
Name:
Title:
CONSENTED AND AGREED TO BY:
BH SENIOR LENDERS
By:
----------------------------
By:
----------------------------
CONSENTED AND AGREED TO BY:
JUNIOR SUBORDINATED NOTEHOLDERS
By:
----------------------------
SCHEDULE 1
LIST OF BORROWERS
SCHEDULE 2
CR FIRST PRIORITY COLLATERAL
SCHEDULE 3
BH FIRST PRIORITY COLLATERAL
Annex I
CR SENIOR SECURITY AGREEMENTS
Annex II
BH SENIOR SECURITY AGREEMENTS
Annex III
JUNIOR SUBORDINATED SECURITY AGREEMENTS
Annex IV
BH REVOLVER PARTICIPATION