Exhibit 99.13
Execution Version
AMENDED AND RESTATED
INTERCREDITOR AGREEMENT
This
AMENDED AND RESTATED INTERCREDITOR AGREEMENT (this “
Agreement ”), dated as of October 1, 2007 and
effective as of the Effective Date (as defined below) is made by
and between SILVER POINT FINANCE, LLC, a Delaware limited liability
company, as the co-agent, syndication agent, and documentation
agent under and pursuant to the First Lien Credit Agreement (as
hereinafter defined) (in such capacity, and as further defined in
Section 1, below, the “ First Lien Co-Agent
”), and WELLS FARGO FOOTHILL, INC., a California corporation,
as administrative agent and collateral agent under and pursuant to
the First Lien Credit Agreement (in such capacity, and as further
defined in Section 1, below, the “ First Lien
Agent ”), HARBINGER CAPITAL PARTNERS MASTER FUND I, LTD.,
an exempted company incorporated with limited liability in the
Cayman Islands, as agent under and pursuant to the New Second Lien
Credit Agreement (as hereinafter defined) (in such capacity, and as
further defined in Section 1, below, the “ New Second
Lien Agent ”) and THE BANK OF NEW YORK, a national
banking association, as agent under and pursuant to the Existing
Second Lien Credit Agreement (as hereinafter defined) (in such
capacity, and as further defined in Section 1, below, the
“ Existing Second Lien Agent ”), and is
acknowledged by Salton, Inc., a Delaware corporation (“
Parent ”), each of Parent’s Subsidiaries
identified on the signature pages of the First Lien Credit
Agreement or otherwise made a party thereto, as Borrowers
(collectively with Parent, the “ Borrowers ”)
and each of Parent’s Subsidiaries identified on the signature
pages of the First Lien Credit Agreement, or otherwise made a party
thereto, as Guarantors (collectively, the “ Guarantors
”).
RECITALS
A.
Parent, the Borrowers, the Guarantors, the First Lien Co-Agent, the
First Lien Agent, and the lenders party thereto (such lenders, and
as further defined in Section 1, below, the “ First
Lien Lenders ”) have entered into that certain Credit
Agreement dated as of May 9, 2003 and amended and restated as
of June 15, 2004 (as amended as of August 30, 2004,
May 11, 2005, July 8, 2005, September 22, 2005,
October 7, 2005, November 9, 2005, February 8, 2006,
May 10, 2006, August 15, 2006, February 12, 2007,
April 13, 2007, June 28, 2007, July 30, 2007,
July 31, 2007, August 6, 2007 and August 8, 2007 and
as further defined in Section 1, below, the “ First
Lien Credit Agreement ”). The repayment of the
Obligations (as that term is defined in the First Lien Credit
Agreement) is secured by security interests in and liens on
substantially all of the assets of the Borrowers and the Guarantors
pursuant to certain collateral documents in favor of the First Lien
Agent (such documents as further defined in Section 1, below,
together with the other collateral and loan documents executed and
delivered in connection with the First Lien Credit Agreement, each
as in effect on the date hereof, are referred to herein as the
“ First Lien Loan Documents ”).
B.
Parent, the Borrowers, the Guarantors, the Existing Second Lien
Agent, and the lenders party thereto (such lenders, and as further
defined in Section 1,
1
below,
the “ Existing Second Lien Lenders ”) have
entered into a Credit Agreement dated as of August 26, 2005
(such agreement as in effect on the date hereof, and as further
defined in Section 1, below, the “ Existing Second
Lien Credit Agreement ”). The repayment of the
Obligations (as that term is defined in the Existing Second Lien
Credit Agreement) is secured by security interests in and liens on
substantially all of the assets of the Borrowers and the Guarantors
pursuant to certain collateral documents in favor of the Existing
Second Lien Agent, (such documents, and as further defined in
Section 1, below, the “ Existing Second Lien Loan
Documents ”).
C. Each
of Harbinger Capital Partners Master Fund I, Ltd. and Harbinger
Capital Partners Special Situations Fund, L.P. has agreed to
purchase certain Indebtedness under the First Lien Credit Agreement
pursuant to, and subject to the terms and conditions of, the Loan
Purchase Agreement dated as of the date hereof among them and
certain of the First Lien Lenders (the “ Put Agreement
”) and upon such purchase the Indebtedness so purchased shall
be discharged under the First Lien Credit Agreement and
automatically converted into loans under the Reimbursement and
Senior Secured Credit Agreement dated as of October 1, 2007
(such agreement as in effect on such date, and as further defined
in Section 1, below, the “ New Second Lien Credit
Agreement ”) among the Borrowers, the Guarantors, the New
Second Lien Agent, and Harbinger Capital Partners Master Fund I,
Ltd. and Harbinger Capital Partners Special Situations Fund, L.P.,
as lenders party thereto (such lenders, and as further defined in
Section 1, below, the “ New Second Lien Lenders
”). The repayment of the Obligations (as that term is defined
in the New Second Lien Credit Agreement) is secured by security
interests in and liens on substantially all of the assets of the
Borrowers and the Guarantors pursuant to certain collateral
documents in favor of the New Second Lien Agent, (such documents,
and as further defined in Section 1, below, the “ New
Second Lien Loan Documents ”).
D. The
First Lien Agent and the First Lien Co-Agent, for and on behalf of
themselves and the First Lien Lenders and the Existing Second Lien
Agent, for and on behalf of itself and the Existing Second Lien
Lenders entered into an Intercreditor Agreement dated as of
August 26, 2005, which Intercreditor Agreement was
acknowledged by the Borrowers and certain of the Guarantors
(“ Original Intercreditor Agreement ”).
E. The
New Second Lien Agent, for and on behalf of itself and the New
Second Lien Lenders and the Existing Second Lien Agent, for and on
behalf of itself and the Existing Second Lien Lenders have entered
into an Intercreditor Agreement dated as of the date hereof, which
Intercreditor Agreement was acknowledged by the Borrowers and
certain of the Guarantors (such Intercreditor Agreement as in
effect on the date hereof, “ Junior Intercreditor
Agreement ”).
F. The
First Lien Agent and the First Lien Co-Agent, for and on behalf of
themselves and the First Lien Lenders, on the one hand and the New
Second Lien Agent, for and on behalf of itself and the New Second
Lien Lenders and the Existing Second Lien Agent, for and on behalf
of itself and the Existing Second Lien Lenders, on the other
2
hand,
wish to enter into this Agreement to add the Existing Second Lien
Agent as a party hereto and to amend and restate in its entirety
the Original Intercreditor Agreement.
NOW, THEREFORE, for valuable consideration, the receipt and
adequacy of which is hereby acknowledged, the First Lien Agent,
First Lien Co-Agent, New Second Lien Agent and Existing Second Lien
Agent hereby agree, effective as of and only from and after the
Effective Date, as follows:
1.
Definitions; Rules of Construction .
a.
Definitions . As used in this Agreement, the following terms
shall have the following meanings:
“
Adequate Protection Lien ” has the meaning set forth
in Section 5.d .
“
Agreement ” means this Agreement as it may be amended,
modified or supplemented from time to time.
“
Application of Proceeds Blockage Event ” has the
meaning set forth in Section 4.a .
“
Application of Proceeds Blockage Period ” has the
meaning set forth in Section 4.a .
“
Bank Product Obligations ” has the meaning set forth
in the First Lien Credit Agreement.
“
Bankruptcy Code ” shall mean Title 11 of the United
States Code, as in effect from time to time.
“
Borrowers ” means Parent and the Subsidiaries of
Parent from time to time party to the First Lien Credit Agreement
as borrowers.
“
Borrowing Base ” has the meaning set forth in the
First Lien Credit Agreement.
“
Borrowing Base Certificate ” has the meaning set forth
in the First Lien Credit Agreement.
“
Capital Stock ” means (a) in the case of a
corporation, corporate stock, (b) in the case of an
association or business entity, any and all shares, interests,
participations, rights or other equivalents (however designated) of
corporate stock, (c) in the case of a partnership or limited
liability company, partnership or membership interests (whether
general or limited) and (d) any other interest or participation
that confers on a Person the right to receive a share of the
profits and losses of, or distributions of property of, the issuing
Person.
3
“
Cash Collateral ” means any Collateral consisting of
money or cash equivalents, any security entitlement (as defined in
the UCC) and any financial assets (as defined in the UCC).
“
Collateral ” means all assets and properties upon
which either First Lien Agent or First Lien Co-Agent, on the one
hand, or any of the Junior Lien Agents, on the other hand, now has
or hereafter acquires a Lien, whether now owned or hereafter
acquired by the Borrowers, any Guarantor or any other Person,
together with all rents, issues, profits, products, and Proceeds
thereof.
“
Control Collateral ” means any Collateral consisting
of a certificated security (as defined in the UCC), investment
property (as defined in the UCC), a deposit account (as defined in
the UCC) and any other Collateral as to which a Lien may be
perfected through physical possession or control by the secured
party or any agent therefor.
“
Credit Support ” has the meaning set forth in the
First Lien Credit Agreement.
“
DIP Financing ” has the meaning set forth in
Section 5.d .
“
Discharge of First Lien Indebtedness ” means payment
in full in cash (or in the case of letters of credit or Bank
Product Obligations, the cash collateralization as required by the
First Lien Loan Documents) of the First Lien Indebtedness (other
than First Lien Indebtedness consisting solely of contingent
indemnification obligations under the First Lien Loan Documents for
which no claim has been asserted in writing) after or concurrently
with termination of all commitments to extend credit under any
First Lien Credit Agreement.
“
Discharge of Junior Lien Indebtedness ” means payment
in full in cash of the Junior Lien Indebtedness (other than Junior
Lien Indebtedness consisting solely of contingent indemnification
obligations under the Junior Lien Loan Documents for which no claim
has been asserted in writing) after or concurrently with
termination of all commitments to extend credit under any Junior
Lien Credit Agreement.
“
Effective Date ” means the date on which the initial
purchase of all or any portion of the Stretch Loans (as defined in
the Put Agreement) is consummated pursuant to a “Stretch Loan
Put Notice” as defined in and delivered pursuant to the Put
Agreement.
“
Eligible Junior Agent ” means, prior to receipt by the
First Lien Agent and the First Lien Co-Agent of written notice that
all New Second Lien Indebtedness has been satisfied in full, the
New Second Lien Agent and, after such receipt of such notice, the
Existing Second Lien Agent.
4
“
Equity Interests ” means Capital Stock and all
warrants, options, or other rights to acquire Capital Stock (but
excluding any debt security that is convertible into, or
exchangeable for, Capital Stock).
“
Event of Default ” means “Event of
Default” as defined in the First Lien Credit Agreement and/or
“Event of Default” as defined any Junior Lien Credit
Agreement.
“
Exercise Any Secured Creditor Remedies ” or “
Exercise of Secured Creditor Remedies ” means
(a) the taking of any action to enforce or realize upon any
Lien, including the institution of any foreclosure proceedings or
the noticing of any public or private sale or other disposition
pursuant to Article 9 of the UCC, (b) the exercise of any
right or remedy provided to a secured creditor or otherwise on
account of a Lien under the First Lien Loan Documents, the Junior
Lien Loan Documents, applicable law, in an Insolvency Proceeding or
otherwise, including the election to retain Collateral in
satisfaction of a Lien, (c) the taking of any action or the
exercise of any right or remedy in respect of the collection on,
set off against, marshaling of, or foreclosure on the Collateral or
the Proceeds of Collateral, (d) the sale, lease, license, or
other disposition of all or any portion of the Collateral, by
private or public sale, other disposition or any other means
permissible under applicable law, (e) the solicitation of bids
from third parties to conduct the liquidation of all or a material
portion of Collateral to the extent undertaken and being diligently
pursued in good faith to consummate the sale of such Collateral
within a commercially reasonable time, (f) the engagement or
retention of sales brokers, marketing agents, investment bankers,
accountants, appraisers, auctioneers or other third parties for the
purposes of valuing, marketing, promoting and selling the
Collateral to the extent undertaken and being diligently pursued in
good faith to consummate the sale of such Collateral within a
commercially reasonable time, and (g) the exercise of any
other enforcement right relating to the Collateral (including the
exercise of any voting rights relating to any Capital Stock and
including any right of recoupment or set-off) whether under the
First Lien Loan Documents, the Junior Lien Loan Documents,
applicable law, in an Insolvency Proceeding or otherwise.
“
Existing Second Lien Agent ” means the Existing Second
Lien Agent as defined in the Recitals, together with its successors
and assigns.
“
Existing Second Lien Credit Agreement ” means the
Existing Second Lien Credit Agreement as defined in the Recitals
and as amended, modified, or supplemented from time to time in
accordance with the terms of this Agreement.
“
Existing Second Lien Indebtedness ” means all
obligations and all other amounts owing, due or secured under the
terms of the Existing Second Lien Credit Agreement or any other
Existing Second Lien Loan Document, including any and all amounts
payable to Existing Second Lien Agent or to any Existing Second
Lien Lender, all principal, premium, interest, fees, attorneys
fees, costs, charges, expenses, reimbursement obligations,
indemnities, guarantees, any prepayment or early termination
premium, and all other amounts payable under any Existing Second
Lien Loan Document
5
or in
respect thereof (including, in each case, all amounts accruing on
or after the commencement of any Insolvency Proceeding relating to
any Obligor, or that would have accrued or become due under the
terms of the Existing Second Lien Loan Documents but for the effect
of the Insolvency Proceeding or other applicable law, and
irrespective of whether a claim for all or any portion of such
amounts is allowable or allowed in such Insolvency
Proceeding).
“
Existing Second Lien Lenders ” means the Existing
Second Lien Lenders as defined in the Recitals.
“
Existing Second Lien Loan Documents ” means the
Existing Second Lien Credit Agreement and the other Loan Documents
(as such term is defined in the Existing Second Lien Credit
Agreement), or any other security, collateral, ancillary or other
document entered into in connection with or related to any
agreement that is a Existing Second Lien Credit Agreement.
“
First Lien Agent ” means the First Lien Agent as
defined in the Recitals , together with its successors, assigns and
transferees under any First Lien Credit Agreement.
“
First Lien Amount ” means, at any date of
determination, the aggregate principal amount of In Formula First
Lien Loans outstanding on such date.
“
First Lien Co-Agent ” means the First Lien Co-Agent as
defined in the Recitals, together with its successors, assigns and
transferees under any First Lien Credit Agreement.
“
First Lien Credit Agreement ” means the First Lien
Credit Agreement as defined in the Recitals and as amended,
restated, modified, renewed, refunded, replaced, or refinanced in
whole or in part from time to time, and any other agreement
extending the maturity of, consolidating, otherwise restructuring
(including adding Subsidiaries or affiliates of any Obligor or any
other Persons as parties thereto), renewing, replacing or
refinancing all or any portion of the Obligations or Commitments as
those terms are defined in the First Lien Credit Agreement or all
or any portion of the amounts owed under any other agreement that
itself is a First Lien Credit Agreement hereunder and whether by
the same or any other agent, lender, or group of lenders and
whether or not increasing the amount of First Lien Indebtedness
that may be incurred thereunder, in each case, to the extent that
any such amendment, restatement, modification, renewal, refunding,
replacement, or refinancing is permitted under this
Agreement.
“
First Lien Default ” means any Event of Default under
the First Lien Credit Agreement.
“
First Lien Indebtedness ” means the principal amount
of all In Formula First Lien Loans outstanding under the First Lien
Loan Documents and all other obligations and amounts owing (other
than the principal amount of First Lien Loans), due
6
or
secured under the terms of the First Lien Credit Agreement, any
other First Lien Loan Document or any DIP Financing provided by a
First Lien Lender, including any and all amounts payable to any
First Lien Lender, all premium, interest, fees, attorneys fees,
costs, charges, expenses, reimbursement obligations, indemnities,
guarantees, the Make-Whole Amount, Bank Product Obligations, Ledger
Product Obligations and all other amounts payable under any First
Lien Loan Document or in respect thereof (including, in each case,
all amounts accruing on or after the commencement of any Insolvency
Proceeding relating to any Obligor, or that would have accrued or
become due under the terms of the First Lien Loan Documents but for
the effect of the Insolvency Proceeding or other applicable law,
and irrespective of whether a claim for all or any portion of such
amounts is allowable or allowed in such Insolvency
Proceeding).
“
First Lien Lender Sale ” has the meaning set forth in
Section 2.c(1) .
“
First Lien Lenders ” means the lenders under any First
Lien Credit Agreement or First Lien Loan Documents.
“
First Lien Loan ” means (i) any Loan (as that
term is defined in the First Lien Credit Agreement) and
(ii) any obligation of the Borrowers to reimburse the First
Lien Lenders for the face amount of drawings under Letters of
Credit or for payments pursuant to any Credit Support.
“
First Lien Loan Documents ” means the First Lien
Credit Agreement and the other Loan Documents (as such term is
defined in the First Lien Credit Agreement), or any other security,
collateral, ancillary or other document entered into in connection
with or related to any agreement that is a First Lien Credit
Agreement, as such documents may be amended, restated, modified,
renewed, refunded, replaced, or refinanced in whole or in part from
time to time, in accordance with this Agreement.
“
First Lien Modification ” has the meaning set forth in
Section 6.a .
“
Forced Obligor Sale ” has the meaning set forth in
Section 2.c(2) .
“
Guarantors ” means the Subsidiaries of Parent from
time to time party to the First Lien Credit Agreement as
guarantors.
“
Harbinger Entities ” means Harbinger Capital Partners
Master Fund I, Ltd., Harbinger Capital Partners Special Situations
Fund, L.P. and any of their respective affiliates.
“
In Formula First Lien Loan ” means any First Lien
Loan; provided that on the date of (and after giving effect to) the
incurrence of such First Lien Loan, the aggregate principal amount
of all outstanding First Lien Loans did not exceed, the lesser of:
(a) $187,500,000 minus the principal amount of Purchased Loans plus
$5,000,000 and (b) the Borrowing Base (as set forth in the
Borrowing Base Certificate then in effect pursuant to the First
Lien Credit Agreement) plus $5,000,000.
7
“
Insolvency Proceeding ” means any proceeding commenced
by or against any Person under any provision of the Bankruptcy Code
or under any other state, federal or foreign bankruptcy or
insolvency law, assignments for the benefit of creditors, formal or
informal moratoria, compositions, extensions generally with
creditors, or proceedings seeking reorganization, arrangement, or
other similar relief.
“
Junior Lien Agents ” means the New Second Lien Agent
and the Existing Second Lien Agent.
“
Junior Lien Credit Agreements ” means the New Second
Lien Credit Agreement and the Existing Second Lien Credit
Agreement.
“
Junior Lien Indebtedness ” means the New Second Lien
Indebtedness and the Existing Second Lien Indebtedness.
“
Junior Lien Lenders ” means the New Second Lien
Lenders and the Existing Second Lien Lenders.
“
Junior Lien Loan Documents ” means the New Second Lien
Loan Documents and the Existing Second Lien Loan Documents.
“
Ledger Product Obligations ” has the meaning set forth
in the First Lien Credit Agreement.
“
Lender ” means a First Lien Lender and/or a Junior
Lien Lender, as the context may require.
“
Letter of Credit ” has the meaning set forth in the
First Lien Credit Agreement.
“
Lien ” means any interest in an asset securing an
obligation owed to, or a claim by, any Person other than the owner
of the asset, irrespective of whether (a) such interest is
based on the common law, statute, or contract, (b) such
interest is recorded or perfected, and (c) such interest is
contingent upon the occurrence of some future event or events or
the existence of some future circumstance or circumstances. Without
limiting the generality of the foregoing, the term
“Lien” includes the lien or security interest arising
from a mortgage, deed of trust, encumbrance, pledge, hypothecation,
assignment, deposit arrangement, security agreement, conditional
sale or trust receipt, or from a lease, consignment, or bailment
for security purposes and also includes reservations, exceptions,
encroachments, easements, rights-of-way, covenants, conditions,
restrictions, leases, and other title exceptions and encumbrances
affecting real property.
“
New Second Lien Agent ” means the New Second Lien
Agent as defined in the Recitals.
8
“
New Second Lien Credit Agreement ” means the New
Second Lien Credit Agreement as defined in the Recitals and as
amended, restated or supplemented in accordance with the terms of
this Agreement.
“
New Second Lien Indebtedness ” means all obligations
and all other amounts owing, due or secured under the terms of the
New Second Lien Credit Agreement, any other New Second Lien Loan
Document or any DIP Financing provided by any New Second Lien
Lender, including any and all amounts payable to New Second Lien
Agent or to any New Second Lien Lender, all principal, premium,
interest, fees, attorneys fees, costs, charges, expenses,
reimbursement obligations, indemnities, guarantees, any prepayment
or early termination premium, and all other amounts payable under
any New Second Lien Loan Document or in respect thereof (including,
in each case, all amounts accruing on or after the commencement of
any Insolvency Proceeding relating to any Obligor, or that would
have accrued or become due under the terms of the New Second Lien
Loan Documents but for the effect of the Insolvency Proceeding or
other applicable law, and irrespective of whether a claim for all
or any portion of such amounts is allowable or allowed in such
Insolvency Proceeding).
“
New Second Lien Lenders ” means the New Second Lien
Lenders as defined in the Recitals.
“
New Second Lien Loan Documents ” means the New Second
Lien Credit Agreement and the other Loan Documents (as such term is
defined in the New Second Lien Credit Agreement), or any other
security, collateral, ancillary or other document entered into in
connection with or related to any agreement that is a New Second
Lien Credit Agreement.
“
Notice of Intent to Exercise ” means a written notice
from or on behalf of any Junior Lien Agent to First Lien Agent and
First Lien Co-Agent (a) stating that such Junior Lien Agent
intends to Exercise Secured Creditor Remedies, (b) stating
that it is a “Notice of Intent to Exercise Secured Creditor
Remedies” and (c) describing the Event(s) of Default
under the relevant Junior Lien Credit Agreement that is(are) the
basis for delivering such notice.
“
Obligor ” means the Borrowers, each Guarantor and any
other Person that now or hereafter is, or whose assets now or
hereafter are, liable for all or any portion of the First Lien
Indebtedness or the Junior Lien Indebtedness, as applicable.
“
Payment Collateral ” means all accounts, instruments,
chattel paper, letters of credit, deposit accounts, securities
accounts, and payment intangibles, together with all supporting
obligations (as those terms are defined in the UCC), in each case
composing a portion of the Collateral.
“
Permitted Application of Proceeds of Collateral ” has
the meaning set forth in Section 3 .
9
“
Permitted Replacement Lien ” has the meaning set forth
in Section 5.i .
“
Person ” means any natural person, corporation,
limited liability company, limited partnership, general
partnership, limited liability partnership, joint venture, trust,
land trust, business trust, or other organization, irrespective of
whether such organization is a legal entity, and shall include a
government and any agency or political subdivision thereof.
“
Proceeds ” means (a) all “proceeds”
as defined in Article 9 of the UCC with respect to the
Collateral, and (b) whatever is recoverable or recovered when
Collateral is sold, exchanged, collected, or disposed of, whether
voluntarily or involuntarily.
“
Parent ” has the meaning set forth in the
Recitals.
“
Purchase Notice ” has the meaning set forth in
Section 10.a .
“
Purchased Loans ” has the meaning set forth in the Put
Agreement.
“
Put Agreement ” has the meaning set forth in Recital
C.
“
Recovery ” has the meaning set forth in
Section 5.c .
“
Reorganization Debt Securities ” has the meaning set
forth in Section 5.a .
“
Standstill Notice ” means a written notice from First
Lien Agent or First Lien Co-Agent to the Junior Lien Agents stating
that a First Lien Default has occurred and is continuing and
stating that it is a “Standstill Notice”.
“
Standstill Period ” means the period beginning on the
date that a Standstill Notice is received by the Junior Lien Agents
through and including the first to occur of (a) the date upon
which the Discharge of First Lien Indebtedness shall have occurred,
(b) the date upon which First Lien Agent or First Lien
Co-Agent shall have waived or acknowledged in writing the
termination of the First Lien Default that gave rise to such
Standstill Period, or (c) the date that is 270 days after
the receipt of such Standstill Notice by Junior Lien Agents.
“
Trigger Event ” has the meaning set forth in
Section 10.a .
“
Trigger Notice ” has the meaning set forth in
Section 10.a .
“
UCC ” means the Uniform Commercial Code as enacted and
in effect from time to time in the State of New York;
provided , however , that in the event that, by
reason of mandatory provisions of law, any or all of the
attachment, perfection, priority, or remedies with respect to
Agent’s Lien on any Collateral is governed by the Uniform
Commercial Code as enacted and in effect in a jurisdiction other
than the State of New York, the term “UCC” shall mean
the Uniform Commercial Code as enacted and in effect
10
in such
other jurisdiction solely for purposes of the provisions thereof
relating to such attachment, perfection, priority, or
remedies.
b.
Terms Defined in the First Lien Credit Agreement . Unless
otherwise defined in this Agreement, any and all initially
capitalized terms set forth in this Agreement shall have the
meaning ascribed thereto in the First Lien Credit Agreement.
c.
Rules of Construction . Unless the context of this Agreement
clearly requires otherwise, references to the plural include the
singular, references to the singular include the plural, the term
“including” is not limiting, and the term
“or” has, except where otherwise indicated, the
inclusive meaning represented by the phrase “and/or.”
The words “hereof,” “herein,”
“hereby,” “hereunder,” and similar terms in
this Agreement refer to this Agreement as a whole and not to any
particular provision of this Agreement. Article, section,
subsection, clause, schedule, and exhibit references herein are to
this Agreement unless otherwise specified. Any reference herein to
any Person shall be construed to include such Person’s
successors and assigns.
2.
Subordination and Standstill .
a.
Lien Subordination . Notwithstanding (i) the date,
time, method, manner or order of grant, attachment, or perfection
of any Liens granted to First Lien Agent (or First Lien Co-Agent or
any First Lien Lender) or any Junior Lien Agent (or any Junior Lien
Lender) in respect of all or any portion of the Collateral,
(ii) the order or time of filing or recordation of any
document or instrument for perfecting the Liens in favor of First
Lien Agent (or First Lien Co-Agent or any First Lien Lender) or any
Junior Lien Agent (or any Junior Lien Lender) in any Collateral,
(iii) any provision of the UCC, any other applicable law, any of
the First Lien Loan Documents or the Junior Lien Loan Documents,
(iv) irrespective of whether the Liens securing the First Lien
Loan Documents are valid, perfected, enforceable, void, avoidable,
subordinated, disputed or allowed, or (v) any other
circumstance whatsoever, each of First Lien Agent and First Lien
Co-Agent, on behalf of itself and the First Lien Lenders, New
Second Lien Agent, on behalf of itself and the Second Lien Lenders
and Existing Second Lien Agent, on behalf of itself and the
Existing Second Lien Lenders hereby agrees that:
(1) any
Lien in respect of all or any portion of the Collateral now or
hereafter held by or on behalf of any Junior Lien Agent or any
Junior Lien Lender that secures all or any portion of the Junior
Lien Indebtedness, shall in all respects be junior and subordinate
to all Liens granted to First Lien Agent, First Lien Co-Agent and
the First Lien Lenders in the Collateral to secure all or any
portion of the First Lien Indebtedness,
(2) any
Lien in respect of all or any portion of the Collateral now or
hereafter held by or on behalf of First Lien Agent, First Lien
Co-Agent or any First Lien Lender that secures all or any portion
of the First Lien Indebtedness shall in all respects be senior and
prior to all Liens granted to any Junior Lien Agent and any of the
Junior
11
Lien
Lenders in the Collateral to secure all or any portion of the
Junior Lien Indebtedness,
(3) any
Lien in respect of all or any portion of the Collateral now or
hereafter held by or on behalf of Existing Second Lien Agent or any
Existing Second Lien Lender that secures all or any portion of the
Existing Second Lien Indebtedness, shall in all respects be junior
and subordinate to all Liens granted to New Second Lien Agent and
any of the New Second Lien Lenders in the Collateral to secure all
or any portion of the New Second Lien Indebtedness as provided in
the Junior Intercreditor Agreement, and
(4) any
Lien in respect of all or any portion of the Collateral now or
hereafter held by or on behalf of New Second Lien Agent or any New
Second Lien Lender that secures all or any portion of the New
Second Lien Indebtedness shall in all respects be senior and prior
to all Liens granted to the Existing Second Lien Agent and any of
the Existing Second Lien Lenders in the Collateral to secure all or
any portion of the Existing Second Lien Indebtedness as provided in
the Junior Intercreditor Agreement.
b.
Remedies Standstill . At any time that a Standstill Period
is in effect, none of the Junior Lien Agent and none of the Junior
Lien Lenders shall, without the prior written consent of First Lien
Co-Agent (acting upon the direction of the requisite First Lien
Lenders):
(1) commence,
prosecute, or participate in any lawsuit, action, or proceeding,
whether private, judicial, equitable, administrative or otherwise
(including any Insolvency Proceeding with respect to any Obligor or
any Obligor’s assets) to the extent that any such action
could reasonably be expected, in any material respect, to restrain,
hinder, limit, delay for any material period or otherwise interfere
with the Exercise of Secured Creditor Remedies by First Lien
Co-Agent, First Lien Agent or First Lien Lenders; provided
that (A) to the extent that commencing, prosecuting, or
participating in any such lawsuit, action, or proceeding could not
reasonably be expected, in any material respect, to restrain,
hinder, limit, delay for any material period or otherwise interfere
with the Exercise of Secured Creditor Remedies by First Lien
Co-Agent, First Lien Agent or First Lien Lenders and a Junior Lien
Agent does, in fact, commence, prosecute, or participate in any
such lawsuit, action, or proceeding, then such Junior Lien Agent
shall give First Lien Co-Agent and First Lien Agent prompt written
notice of any such action, and (B) as more fully set forth in
Section 5 , Junior Lien Agents and the Junior Lien
Lenders may file, prosecute and defend a proof of claim (such proof
of claim to indicate the subordination set forth herein) in any
Insolvency Proceeding involving any Obligor;
(2) Exercise
Any Secured Creditor Remedies;
(3) send
any notice to or otherwise seek to obtain payment directly from any
account debtor of any Obligor, sue for an attachment, an injunction
to enjoin any Exercise of Secured Creditor Remedies by First Lien
Co-Agent, First Lien Agent or First
12
Lien
Lenders, a keeper, a receiver or any other similar legal or
equitable remedy, exercise any rights of set off or recoupment as
against any Obligor; or
(4) commence
or cause to be commenced or join with any creditor in commencing
any Insolvency Proceeding against any Obligor or any
Obligor’s assets.
Notwithstanding
any other provision hereof, no Junior Lien Agent and no Junior Lien
Lender may: (i) Exercise Any Secured Creditor Remedies with
respect to any Payment Collateral at any time unless and until the
Discharge of First Lien Indebtedness shall have occurred;
(ii) exercise any of the remedies described in clauses
(1) through (4) above (other than filing, prosecuting or
defending a proof of claim permitted under such clause (4)) so long
as (A) First Lien Co-Agent or First Lien Agent at such time
has commenced and diligently is pursuing in good faith any Exercise
of Secured Creditor Remedies with respect to all or a material
portion of the Collateral or (B) First Lien Co-Agent, First Lien
Agent and Junior Lien Agents are enjoined from the Exercise of
Secured Creditor Remedies, in each case, unless and until the
Discharge of First Lien Indebtedness shall have occurred; or
(iii) exercise any of the remedies described in clauses
(1) through (4), above without first providing First Lien
Co-Agent and First Lien Agent at least 10 days prior written
notice in the form of a Notice of Intent to Exercise (it being
understood that (x) notwithstanding anything to the contrary
contained herein, such Notice of Intent to Exercise may only be
delivered by the Existing Second Lien Agent if there is an Event of
Default under Section 9.1(a) ,
Section 9.1(c) (solely with respect to a default under
Section 7.23 of the Existing Second Lien Credit Agreement as
in effect on the date hereof), or Section 9.1(d)
(solely with respect to a default in the payment when due of
interest or principal on the Senior Notes under the Indentures) of
the Existing Second Lien Credit Agreement as in effect on the date
hereof or by the New Second Lien Agent if there is an Event of
Default under Section 9.1(a) , or
Section 9.1(d) (solely with respect to a default in the
payment when due of interest or principal on the Senior Notes under
the Indentures) of the New Second Lien Credit Agreement as in
effect on the date hereof and (y) if First Lien Co-Agent or
First Lien Agent does not deliver a Standstill Notice to a Junior
Lien Agent by the end of such 10 day period, such Junior Lien
Agent may proceed with the exercise of such remedies, and if such
Junior Lien Agent elects to exercise such remedies, neither First
Lien Agent nor First Lien Co-Agent may exercise any of the remedies
of the type described in clauses (1) through (4) above so
long as such Junior Lien Agent at such time has commenced and
diligently is pursuing in good faith any Exercise of Secured
Creditor Remedies with respect to all or a material portion of the
Collateral, unless and until the Discharge of Junior Lien
Indebtedness shall have occurred); provided , that such
Junior Lien Agent shall not be required to provide a Notice of
Intent to Exercise to First Lien Agent and First Lien Co-Agent in
connection with a permitted Exercise of Secured Creditor Remedies
upon the termination of any Standstill Period.
c.
Limitation on Standstill Periods . Subject to clause
(ii) in the last paragraph of Section 2.b , in no
event shall a Standstill Period extend beyond 270 days from
the date of receipt by Junior Lien Agents from First Lien Agent or
First Lien Co-Agent of a Standstill Notice initiating such
Standstill Period. Any number of notices of a
13
First
Lien Default may be given during a Standstill Period, but no such
notice shall extend such Standstill Period. Only 2 Standstill
Periods may be commenced within any 360 day period, and no
subsequent Standstill Period may be commenced within 60 days
after the termination of the immediately preceding Standstill
Period. No First Lien Default that existed or was continuing on the
date of the commencement of any Standstill Period and that was
known to First Lien Agent, First Lien Co-Agent or any First Lien
Lender will be, or can be, made the basis for the commencement of a
second Standstill Period, whether or not within a period of 360
consecutive days, unless such First Lien Default has been cured or
waived for a period of not less than 60 consecutive days.
d.
Release of Liens .
(1) In
the event of any private or public sale or other disposition of all
or any portion of the Collateral by First Lien Agent or First Lien
Co-Agent after the occurrence and during the continuance of a First
Lien Default (and prior to the date upon which the Discharge of
First Lien Indebtedness shall have occurred) in connection with the
liquidation by First Lien Agent or First Lien Co-Agent of all or
any material portion of the Collateral and the collection by First
Lien Agent or First Lien Co-Agent of the First Lien Indebtedness
through the sale or other disposition of such Collateral (whether
prior to or after the occurrence of an Insolvency Proceeding) (any
such sale or other disposition, a “ First Lien Lender
Sale ”), then each of the New Second Lien Agent, on
behalf of itself and the New Second Lien Lenders, and the Existing
Second Lien Agent, on behalf of itself and the Existing Second Lien
Lenders, agrees that such First Lien Lender Sale will be free and
clear of the Liens securing the Junior Lien Indebtedness (and, if
the First Lien Lender Sale includes Equity Interests in any
Obligor, each of the New Second Lien Agent, on behalf of itself and
the New Second Lien Lenders, and the Existing Second Lien Agent, on
behalf of itself and the Existing Second Lien Lenders, further
agrees to release the entities whose Equity Interests are sold from
all New Second Lien Indebtedness and Existing Second Lien
Indebtedness, as applicable); provided that (x) First
Lien Agent, First Lien Co-Agent and the First Lien Lenders also
release their Liens on such Collateral (and, if the First Lien
Lender Sale includes Equity Interests in any Obligor, the entities
whose Equity Interests are sold from all First Lien Indebtedness),
(y) the Proceeds of any such First Lien Lender Sale are
applied in accordance with Section 9 , and
(z) First Lien Agent or First Lien Co-Agent shall have
conducted such First Lien Lender Sale in a commercially reasonable
manner and in accordance with the UCC.
(2) In
the event of any private or public sale or other disposition of all
or substantially all of the Collateral by any Obligor with the
consent of First Lien Co-Agent and/or First Lien Agent after the
occurrence and during the continuance of a First Lien Default (and
prior to the date upon which the Discharge of First Lien
Indebtedness shall have occurred), which sale or other disposition
is conducted by such Obligor with the consent of First Lien
Co-Agent and/or First Lien Agent (any such sale or other
disposition, a “ Forced Obligor Sale ”), then
each of the New Second Lien Agent, on behalf of itself and the New
Second Lien Lenders and the Existing Second Lien Agent, on behalf
of itself and the Existing Second Lien Lenders, agrees that such
Forced Obligor
14
Sale
will be free and clear of the Liens securing the New Second Lien
Indebtedness and the Existing Second Lien Indebtedness, as
applicable (and, if the Forced Obligor Sale includes Equity
Interests in any Obligor, each of the New Second Lien Agent, on
behalf of itself and the New Second Lien Lenders and the Existing
Second Lien Agent, on behalf of itself and the Existing Second Lien
Lenders, further agrees to release the entities whose Equity
Interests are sold from all New Second Lien Indebtedness and
Existing Second Lien Indebtedness, as applicable); provided
that (x) First Lien Agent, First Lien Co-Agent and the First Lien
Lenders also release their Liens on such Collateral (and, if the
Forced Obligor Sale includes Equity Interests in any Obligor, the
entities whose Equity Interests are sold from all First Lien
Indebtedness), (y) the Proceeds of any such Forced Obligor
Sale are applied in accordance with Section 9 (as if it
were Proceeds received in connection with any Exercise of Secured
Creditor Remedies), and (z) the Obligor conducting such Forced
Obligor Sale shall have conducted such Forced Obligor Sale in a
commercially reasonable manner as if such Forced Obligor Sale were
being conducted by a secured creditor in accordance with the
UCC.
(3) Each
Junior Lien Agent agrees that, in connection with any First Lien
Lender Sale or Forced Obligor Sale, upon the prior written request
of First Lien Co-Agent or First Lien Agent (which request shall
specify the proposed terms of the sale and the type and amount of
consideration to be received in connection therewith), it will
execute and/or file any and all Lien releases or other documents
reasonably requested by First Lien Co-Agent or First Lien Agent in
connection therewith (copies of which are provided to such Junior
Lien Agent) without recourse, representation or warranty and at the
sole expense of the Obligors; provided , that (w) in
the case of a First Lien Lender Sale, no such release documents
shall be delivered to any Obligor, (x) in the case of a Forced
Obligor Sale, no such release documents shall be delivered to any
Obligor unless First Lien Co-Agent or First Lien Agent has
delivered its release documents to such Obligor, (y) no such
release documents shall be delivered to a Junior Lien Agent for
execution more than 5 days prior to the anticipated closing
date of such sale or disposition, and (z) the effectiveness of
any such release or termination by such Junior Lien Agent shall be
subject to the sale or other disposition of the Collateral
described in such request and on the terms described in such
request or on substantially similar terms and shall lapse in the
event such sale or other disposition does not occur within
10 days of the anticipated closing date (at which time First
Lien Co-Agent, First Lien Agent or the Obligors, as the case may
be, shall promptly return all release documents to such Junior Lien
Agent). Subject to the proviso in the immediately preceding
sentence, in the event that a Junior Lien Agent fails to so execute
or file any such Lien releases or other documents within 5 Business
Days after receipt of written request from First Lien Agent or
First Lien Co-Agent, each of First Lien Co-Agent and First Lien
Agent is hereby irrevocably authorized to execute and/or file such
Lien releases and other documents (provided that such Lien releases
and other documents shall not be filed or recorded except
substantially contemporaneous with such sale or disposition or
until such sale or disposition has been consummated).
15
e.
Waiver of Right to Contest First Lien Indebtedness . Each
Junior Lien Agent agrees that it and the Junior Lien Lenders for
which it is agent shall not, and hereby waive any right to, take
any action to contest or challenge (or assist or support any other
Person in contesting or challenging), directly or indirectly,
whether or not in any proceeding (including in any Insolvency
Proceeding), the validity, priority, enforceability, or perfection
of the Liens of First Lien Agent (on behalf of itself, the First
Lien Co-Agent and the First Lien Lenders) in any Collateral, the
validity, priority, enforceability or allowance of the First Lien
Indebtedness or any of the claims of First Lien Agent or any holder
of First Lien Indebtedness against any Obligor or the validity or
enforceability of this Agreement or any of the provisions hereof.
Each Junior Lien Agent agrees that neither it nor the Junior Lien
Lenders for which it is agent will take any action that would
interfere with any Exercise of Secured Creditor Remedies undertaken
by First Lien Co-Agent or First Lien Agent under the First Lien
Loan Documents, including any public or private sale, lease,
exchange, transfer, or other disposition of any Collateral, whether
by foreclosure or otherwise, in any case so long as First Lien
Co-Agent or First Lien Agent does not act in contravention of this
Agreement or applicable law. Each Junior Lien Agent hereby waives
any and all rights it and the Junior Lien Lenders for which it is
agent may have as a junior lien creditor or otherwise to contest,
protest, object to, interfere with the manner in which First Lien
Co-Agent or First Lien Agent seeks to enforce the Liens in any
Collateral so long as First Lien Co-Agent or First Lien Agent does
not act in contravention of this Agreement or applicable law.
f.
Waiver of Right to Contest Junior Lien Indebtedness . Each
of First Lien Agent and First Lien Co-Agent agrees that it and the
First Lien Lenders shall not, and hereby waives any right to, take
any action to contest or challenge (or assist or support any other
Person in contesting or challenging), directly or indirectly,
whether or not in any proceeding (including in any Insolvency
Proceeding), the validity, priority (except to the extent expressly
provided by this Agreement), enforceability, or perfection of the
Liens of Junior Lien Agents (on behalf of themselves and the Junior
Lien Lenders) in any Collateral, the validity, priority (except to
the extent expressly provided by this Agreement), enforceability or
allowance of any of the claims of any Junior Lien Agent or any
holder of Junior Lien Indebtedness against any Obligor or the
validity or enforceability of this Agreement or any of the
provisions hereof. Solely to the extent that a Junior Lien Agent is
permitted to Exercise Secured Creditor Remedies under this
Agreement, each of First Lien Agent and First Lien Co-Agent agrees
that neither it nor the First Lien Lenders will take any action
that would interfere with any Exercise of Secured Creditor Remedies
undertaken by such Junior Lien Agent under the Junior Lien Loan
Documents, including any public or private sale, lease, exchange,
transfer, or other disposition of any Collateral, whether by
foreclosure or otherwise, in any case so long as such Junior Lien
Agent does not act in contravention of this Agreement or applicable
law.
g.
Acknowledgement of Liens . Each Junior Lien Agent
acknowledges and agrees, for itself and on behalf of the Junior
Lien Lenders for which it is agent, that the First Lien Agent, for
the benefit of itself, the First Lien Co-Agent and
16
the
First Lien Lenders, has been and may be granted Liens upon all of
the Collateral in which such Junior Lien Agent has been granted
Liens and each Junior Lien Agent hereby consents thereto. Each of
First Lien Agent and First Lien Co-Agent acknowledges and agrees
that the Junior Lien Agents, for the benefit of themselves and the
Junior Lien Lenders, has been or, subject to the terms of this
Agreement, may be granted Liens upon all of the Collateral in which
the First Lien Agent and First Lien Co-Agent has been granted Liens
and each of the First Lien Agent and First Lien Co-Agent hereby
consents thereto. Each Junior Lien Agent agrees that neither it nor
any Junior Lien Lender for which it is agent shall obtain a Lien on
any asset or Collateral to secure all or any portion of the Junior
Lien Indebtedness unless concurrently therewith, the First Lien
Agent (on behalf of itself, the First Lien Co-Agent and the First
Lien Lenders) obtains a Lien on such asset or Collateral and the
parties hereby agree that all such Liens are and will be subject to
this Agreement. The subordination of Liens by the Junior Lien
Agents in favor of the First Lien Agent, the First Lien Co-Agent
and the First Lien Lenders shall not be deemed to subordinate the
Junior Lien Agent’s Liens to the Liens of any other Person
that is not a holder of First Lien Indebtedness.
h.
Agent for Perfection . First Lien Agent and First Lien
Co-Agent, on the one hand, and each Junior Lien Agent, on the other
hand, each agree to hold all Control Collateral and Cash
Collateral, as applicable, in their respective possession, custody,
or control (or in the possession, custody, or control of
agent
|
