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EXHIBIT 10.50
INTERCREDITOR AND
COLLATERAL SHARING AGREEMENT
This INTERCREDITOR AND COLLATERAL SHARING AGREEMENT, dated
April 13, 2006 (as amended, modified or supplemented, this
"AGREEMENT"), is by
and among HUDSON UNITED CAPITAL, A DIVISION OF TD BANKNORTH, N.A.,
a national
banking association ("HUDSON UNITED CAPITAL"), as the agent
pursuant to the
Construction and Term Loan Agreement, dated the date hereof (the
"SENIOR LOAN
AGREEMENT"), among Pacific Ethanol Madera LLC, a Delaware limited
liability
company ("BORROWER"), the lenders from time to time party thereto
(the "SENIOR
LENDERS"), and Hudson United Capital, as administrative agent for
the Senior
Lenders (in such capacity, together with its successors and
assigns, the "SENIOR
AGENT"), LYLES DIVERSIFIED, INC., a California corporation, as
lender (in such
capacity, together with its permitted successors and assigns, the
"JUNIOR
LENDER" and, together with the Senior Lenders, the "LENDERS"),
pursuant to the
Amended and Restated Term Loan Agreement, dated as of April 13,
2006 (the
"JUNIOR LOAN AGREEMENT"), by and between the Junior Lender and
Borrower, and
PACIFIC ETHANOL MADERA LLC, a Delaware limited liability
company.
RECITALS
WHEREAS, pursuant to the Senior Loan Agreement, the Senior
Lenders have agreed to make certain construction and term loans
(the "SENIOR
LOANS") to Borrower;
WHEREAS, the Senior Loans are and will be secured by first
priority pledges of, mortgages on and security interests in the
Collateral (as
defined below);
WHEREAS, pursuant to the Junior Loan Agreement, Junior Lender
has made one or more loans to Borrower in the aggregate original
principal
amount of $5,100,000 (such loans and all other obligations of
Borrower to Junior
Lender pursuant to the Junior Loan Agreement, the "JUNIOR
LOAN");
WHEREAS, the obligations of Borrower in respect of the Junior
Loan have been secured by liens on a portion of the Collateral,
which liens are
intended to be junior to the liens securing the Senior Loans;
and
WHEREAS, the Senior Agent and the Junior Lender desire by
entering into this Agreement to define the rights and
responsibilities as
between them concerning the Collateral;
NOW, THEREFORE, in consideration of the premises and the
mutual agreements contained herein, and other good and valuable
consideration,
the receipt and adequacy of which are hereby acknowledged, the
parties hereto
agree as follows:
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ARTICLE I
DEFINITIONS
Section 1.1 DEFINITIONS. Capitalized terms used and not
otherwise defined in this Agreement have the meanings given to
those terms in
Schedule X hereto.
ARTICLE II
SENIOR AGENT'S RIGHT TO FORECLOSE
Section 2.1 SENIOR AGENT'S RIGHT TO FORECLOSE. Junior Lender
hereby agrees that nothing in the Junior Loan Agreement or the
related security
documents or this Agreement will restrict any right of the Senior
Agent or the
Senior Lenders to foreclose on or exercise any other right or
remedy with
respect to the Senior Agent's and the Senior Lenders' security
interests in the
Collateral, and the Senior Agent or any Senior Lender may foreclose
on or
exercise any other right or remedy with respect to the Collateral,
to the
exclusion of any similar right or remedy that the Junior Lender
many have, in
any manner or order and at any time.
ARTICLE III
RIGHTS OF THE LENDERS
Section 3.1 LIEN PRIORITY. The Junior Lender acknowledges and
agrees that (x) it does not have, and will not assert, any Lien
against any
asset of Borrower other than the Junior Lender Collateral and (y)
the Liens on
the Collateral granted to the Senior Agent for the benefit of the
Senior Lenders
pursuant to the security documents executed in connection with the
Senior Loan
Agreement will at all times be superior in priority to any Lien on
the
Collateral, including the Junior Lender Collateral, granted to the
Junior Lender
pursuant to the security documents executed in connection with the
Junior Loan
Agreement, regardless of the order or time of the granting of any
Lien, the
order or time as to which any Lien attached to any or all of the
Collateral or
the order or time of any UCC filing or other filing or
recording.
Section 3.2 SUBORDINATION.
(a) The Junior Lender may not commence any action or
proceeding against Borrower to exercise remedies under the
documents relating to
the Junior Obligations with respect to any Collateral, or receive
any proceeds
from the sale or disposition thereof, unless and until the Senior
Obligations
have been paid in full.
(b) The Senior Agent and the Senior Lenders may, at any time
and from time to time, without the consent of or notice to the
Junior Lender,
without incurring responsibility or liability to the Junior Lender
and without
impairing or releasing any right or obligation of the Senior Agent
or the Senior
Lenders hereunder:
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(i) amend the Senior Loan Agreement in any manner or
enter into or amend in any manner any other agreement relating to
the
Senior Obligations;
(ii) sell, exchange, release or otherwise deal with
any property by whomsoever at any time pledged or mortgaged to
secure,
or howsoever securing, the Senior Obligations;
(iii) release any Person liable in any manner for the
payment or collection of the Senior Obligations, including
without
limitation Borrower;
(iv) exercise or refrain from exercising any right
against Borrower or any other Person; and
(v) apply any sum by whomsoever paid or however
realized to the Senior Obligations.
(c) Subject to the payment in full of the Senior Obligations
in cash, the Junior Lender will be subrogated to the Senior Agent's
and the
Senior Lenders' rights to receive payments or distributions in cash
or property
applicable to the Senior Obligations and, as among Borrower and its
creditors
other than the Senior Agent, the Senior Lenders and the Junior
Lender, no such
payment or distribution made to the Senior Agent or the Senior
Lenders by virtue
of this Agreement that otherwise would have been made to the Junior
Lender will
be deemed to be a payment by Borrower on account of the Junior
Obligations, it
being understood that the provisions of this Section 3.2(c) are
intended solely
for the purpose of defining the relative rights of the Junior
Lender, the Senior
Agent and the Senior Lenders.
(d) The Junior Lender will not sell, assign, transfer or
otherwise dispose of the Junior Obligations to any Person that is
not an
Affiliate of the Junior Lender without the prior written consent of
the Senior
Agent, which consent will not be unreasonably withheld or
delayed.
Section 3.3 NOTICES. The Junior Lender agrees that it will
provide the Senior Agent with prompt notice of any default under
the Junior Loan
Agreement of which the Junior Lender has knowledge.
ARTICLE IV
APPLICATION OF COLLATERAL
Section 4.1 PAYMENTS. Except as otherwise expressly provided
in this Agreement, all amounts received by or available to the
Senior Agent, the
Senior Lenders or the Junior Lender in respect of proceeds from the
disposition
of any Collateral on which the Junior Lender has a lien will be
applied as
follows:
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FIRST: Payment of all fees, costs and expenses of the Senior
Agent in accordance with the
