INTERCREDITOR AGREEMENT
This INTERCREDITOR AGREEMENT, dated as of
November 16, 2004, is among LASALLE BANK NATIONAL ASSOCIATION, in
its capacity as the Administrative Agent under the Credit Agreement
(as defined below) (in such capacity, the " Administrative
Agent "), WELLS FARGO BANK, N.A., as collateral agent and
trustee under the Indenture referred to below (in its capacity as
collateral agent, the " Trustee "), and INTEGRATED ALARM
SERVICES GROUP, INC., a Delaware corporation (the " Borrower
").
W I T N E S S E T H
:
WHEREAS, the Borrower, Criticom International
Corporation, Monital Signal Corporation, Payne Security Group,
L.L.C., American Home Security, Inc., various financial
institutions from time to time parties thereto (the "
Lenders ") and the Administrative Agent are entering into a
Credit Agreement, dated as of November 16, 2004 (as amended,
supplemented, amended and restated or otherwise modified from time
to time, the " Credit Agreement ");
WHEREAS, the Obligors (as hereinafter defined)
will grant to the Administrative Agent, for the benefit of the
Lenders, security interests in the First Priority Collateral (as
hereinafter defined) as security for payment and performance of the
First Priority Claims (as hereinafter defined);
WHEREAS, the Borrower and the Trustee are
entering into an Indenture, dated as of November 16, 2004 (as
amended, supplemented, amended and restated or otherwise modified
from time to time, the " Indenture "), governing the rights
and duties of the Borrower under its 12% Senior Secured Notes due
2011 in the original aggregate principal amount of $125,000,000
(together with any additional notes issued under the Indenture, the
" Notes "); and
WHEREAS, the Obligors will grant to the Trustee,
for the benefit of the Noteholders (as hereinafter defined),
security interests in the Noteholder Collateral (as hereinafter
defined) as security for payment and performance of the Noteholder
Claims (as hereinafter defined);
NOW, THEREFORE, in consideration of the
foregoing, the mutual covenants and obligations herein set forth
and for other good and valuable consideration, the adequacy and
receipt of which are hereby acknowledged, and in reliance upon the
representations, warranties and covenants herein contained, the
parties hereto, intending to be legally bound, hereby agree as
follows:
Section 1.
Definitions
.
1.1
Defined Terms
. As used in this Agreement, the following terms
shall have the following meanings (such meanings to be equally
applicable to both the singular and the plural forms of the terms
indicated):
" Administrative Agent " means, in
addition to the Administrative Agent defined in the preamble
, the then acting agent for the Lenders under the Loan Documents
and any successor thereto exercising substantially the same rights
and powers.
" Agreement " means this
Intercreditor Agreement, as amended, supplemented, amended and
restated or otherwise modified from time to time in accordance with
the terms hereof.
" Bankruptcy Code " means Title 11 of the
United States Code (11 U.S.C. 101 et seq. ).
" Borrower " is defined in the
preamble .
" Business Day " means any day other than
a Saturday, Sunday or other day on which commercial banks are
required or authorized to be closed in New York, New
York.
" Cash Management Obligations " means all
obligations of the Borrower or any other Obligor to any Lender
under or in connection with any arrangement in respect of overdraft
protection, Automated Clearing House services and other treasury,
depositary and cash management services, including reimbursement
obligations relating thereto, overdraft liabilities, liabilities in
respect of returned items, fees, expenses and indemnities
(including interest accruing thereon after the filing of a petition
in bankruptcy or the commencement of any Insolvency Proceeding,
regardless of whether the same is allowed as a claim in such
proceeding).
" Common Collateral " means all of the
assets and property of the Obligors, whether real, personal or
mixed, constituting both First Priority Collateral and Noteholder
Collateral.
" Comparable Noteholder Collateral
Document " means, in relation to any Common Collateral subject
to any Lien created under any First Priority Collateral Document,
that Noteholder Collateral Document which creates a Lien in the
same Common Collateral, granted by the same Obligor, as
applicable.
" Credit Agreement " is defined in the
first recital ; provided that (i) the
term "Credit" Agreement shall (x) also include any renewal,
extension, refunding, restructuring, replacement or refinancing
thereof (whether with the original administrative agent and lenders
or another administrative agent or agents or other lenders, whether
provided under the original Credit Agreement or any other credit or
other agreement or indenture and whether entered into concurrently
with or subsequent to the termination of the prior Credit
Agreement), provided that any such renewal, extension,
refunding, restructuring, replacement or refinancing does not
increase the principal amount thereof beyond the limit set forth in
the Indenture or any other Noteholder Document and (y) exclude the
Notes and other Noteholder Documents and (ii) if at any time a
Discharge of First Priority Claims occurs with respect to the
Credit Agreement (without giving effect to Section 5.6 ),
then, to the extent provided in Section 5.6 , the term
"Credit Agreement" shall mean the Future First Lien Credit Facility
designated by the Borrower in accordance with the terms of such
section.
" Credit Agreement Obligations " means
all Obligations under or pursuant to the Credit
Agreement.
" DIP Financing " is defined in
Section 6.1 .
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" Discharge of First Priority Claims "
means, except to the extent otherwise provided in Sections
5.6 and 6.5 , payment in full in cash of (a) the
principal of and interest (including interest accruing on or after
the commencement of any Insolvency Proceeding, whether or not such
interest would be allowed in such Insolvency Proceeding) and
premium, if any, on all Indebtedness outstanding under the First
Lien Credit Facilities and, with respect to letters of credit
outstanding thereunder, termination thereof or delivery of cash
collateral or backstop letters of credit in respect thereof and for
the full amount thereof in compliance with such First Lien Credit
Facilities, as applicable, in each case after or concurrently with
termination of all commitments to extend credit thereunder and (b)
any other First Priority Claims that are due and payable or
otherwise accrued and owing at or prior to the time such principal
and interest are paid, in each case other than obligations that
constitute Unasserted Contingent Obligations at the time such
principal and interest is paid.
" First Lien Credit Facilities " means
(a) the credit facilities provided pursuant to the Credit Agreement
and (b) any other credit facility permitted by Section 4.07(b)(i)
of the Indenture, that, in the case of both clauses (a) and
(b) , is secured by a Lien permitted pursuant to clause (5)
of the definition of "Permitted Liens" in Section 1.01 of the
Indenture.
" First Priority Cash Management
Obligations " means any Cash Management Obligations secured by
any Common Collateral under the same First Priority Collateral
Documents that secure Obligations under any First Lien Credit
Facility.
" First Priority Claims " means (a) all
Credit Agreement Obligations, (b) all Obligations under one or more
other First Lien Credit Facilities, the Indebtedness under each of
which is designated by the Borrower as "First Priority Claims" for
purposes of the Indenture, (c) all other Obligations of the
Borrower or any other Obligor under the First Priority Documents,
including all First Priority Hedging Obligations and First Priority
Cash Management Obligations and (d) all Future Other First Lien
Obligations. First Priority Claims shall include all interest
accrued or accruing (or which would, absent the commencement of an
Insolvency Proceeding, accrue) after the commencement of an
Insolvency Proceeding in accordance with and at the rate specified
in the relevant First Priority Document whether or not the claim
for such interest is allowed as a claim in such Insolvency
Proceeding. To the extent any payment with respect to the First
Priority Claims (whether by or on behalf of any Obligor, as
proceeds of security, enforcement of any right of set-off or
otherwise) is declared to be fraudulent or preferential in any
respect, set aside or required to be paid to a debtor in
possession, trustee, receiver or similar Person, then the
obligation or part thereof originally intended to be satisfied
shall be deemed to be reinstated and outstanding as if such payment
had not occurred. Notwithstanding the foregoing the Notes and
related Obligations will not constitute First Priority Claims and
collateral therefor will not constitute First Priority Collateral
even if any proceeds of the Notes are used to repay Obligations
under the Credit Agreement. Notwithstanding anything to the
contrary contained in this definition, any Obligation under a First
Priority Document (including any Cash Management Obligation or
Hedging Obligation) shall constitute a "First Priority Claim" if
the Administrative Agent or the relevant First Priority Lender or
First Priority Lenders under such First Priority Document shall
have received a written representation from the Borrower in or in
connection with such First Priority Document that such Obligation
constitutes a "First Priority Claim" under and as defined in the
Indenture (whether or not such Obligation is at any time determined
not to have been permitted to be incurred under the
Indenture).
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" First Priority Collateral " means all
of the property or assets of any Obligor, whether real, personal or
mixed, with respect to which a Lien is granted or held as security
for any First Priority Claim.
" First Priority Collateral Documents "
means any agreement, document or instrument pursuant to which a
Lien is granted securing any First Priority Claim or under which
rights or remedies with respect to such Liens are
governed.
" First Priority Documents " means the
Credit Agreement, the Loan Documents, the First Priority Collateral
Documents and each of the other agreements, documents and
instruments (including each agreement, document or instrument
providing for or evidencing a First Priority Hedging Obligation or
First Priority Cash Management Obligation) providing for or
evidencing any other Obligation under the Credit Agreement or any
other First Lien Credit Facility or any Future Other First Lien
Obligation, and any other related document or instrument executed
or delivered pursuant to any First Priority Document at any time or
otherwise evidencing any First Priority Claim.
" First Priority Hedging Obligations "
means any Hedging Obligations secured by any Common Collateral
under the same First Priority Collateral Documents that secure
Obligations under a First Priority Credit Facility.
" First Priority Lenders " means the
Persons holding First Priority Claims, including the Administrative
Agent.
" First Priority Liens " means all Liens
that secure the First Priority Claims.
" Future First Lien Credit Facility "
shall mean the Credit Agreement and any other First Lien Credit
Facility that is designated by the Borrower as a "First Lien Credit
Facility" for purposes of the Indenture or any other Noteholder
Document; provided that the lenders under any Credit
Agreement then in effect have consented to such
designation.
" Future Other First Lien Obligations "
means all Obligations of the Borrower or any other Obligor in
respect of Cash Management Obligations or Hedging Obligations that
are designated by the Borrower as "First Priority Claims" as
permitted by the Indenture (other than any First Priority Cash
Management Obligations and First Priority Hedging Obligations);
provided that the required lenders (however denominated)
under any First Lien Credit Facility then in effect have consented
to such designation.
" Hedging Obligations " has the meaning
assigned thereto in the Indenture.
" Indebtedness " has the meaning assigned
thereto in the Indenture.
" Indenture " is defined in the
third recital .
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" Insolvency Proceeding " means (a) any
voluntary or involuntary case or proceeding under the Bankruptcy
Code with respect to any Obligor as a debtor, (b) any other
voluntary or involuntary insolvency, reorganization or bankruptcy
case or proceeding, or any receivership, liquidation,
reorganization or other similar case or proceeding with respect to
any Obligor as a debtor or with respect to any substantial part of
their respective assets, (c) any liquidation, dissolution,
reorganization or winding up of any Obligor, whether voluntary or
involuntary and whether or not involving insolvency or bankruptcy,
or (d) any assignment for the benefit of creditors or any other
marshaling of assets and liabilities of any Obligor.
" Lenders " is defined in the
first recital .
" Lien " means, when used with respect to
any Person, any interest in any property, asset or other right
owned or being purchased or acquired by such Person which secures
payment or performance of any obligation, and shall include any
mortgage, lien, encumbrance, charge or other security interest of
any kind, whether arising by contract, as a matter of law, by
judicial process or otherwise.
" Loan Documents " means the Credit
Agreement, the Loan Documents (as defined in the Credit Agreement),
and all documents and instruments evidencing any obligation under
any Future First Lien Credit Facility, and any other related
document or instrument executed or delivered pursuant to any Loan
Document or Future First Lien Credit Facility at any time or
otherwise evidencing any First Priority Claim, as any such document
or instrument may from time to time be amended, supplemented,
amended and restated or otherwise modified from time to time;
provided that any such modification does not increase the
principal amount thereof beyond the limit set forth in the
Indenture or any other Noteholder Document.
" Noteholder Claims " means all
Indebtedness, Obligations and other liabilities (contingent or
otherwise) arising under or with respect to the Noteholder
Documents or any of them.
" Noteholder Collateral " means any of
the property or assets of the Obligors, whether real, personal or
mixed, in which the Noteholders or the Trustee or any of them now
or hereafter holds a Lien as security for any Noteholder Claim
(regardless of the effect of the application of any laws relating
to fraudulent transfers or conveyances).
" Noteholder Collateral Documents "
means, collectively, the Noteholder Security Agreements and any
document or instrument executed and delivered pursuant to any
Noteholder Document at any time or otherwise pursuant to which a
Lien is granted by an Obligor to secure the Noteholder Claims or
under which rights or remedies with respect to any such Lien are
governed, as the same may be amended, supplemented, amended and
restated or otherwise modified from time to time.
" Noteholder Documents " means,
collectively, the Indenture, the Notes, the Noteholder Collateral
Documents, and any other related document or instrument executed
and delivered pursuant to any Noteholder Document at any time or
otherwise evidencing any Noteholder Claims, as the same may be
amended, supplemented, amended and restated or otherwise modified
from time to time.
" Noteholders " means the Persons holding
Noteholder Claims, including the Trustee.
" Noteholder Security Agreements " means
(i) the Security Agreement, dated as of November 16, 2004, among
the Borrower, its Subsidiaries and the Trustee and (ii) the Pledge
Agreement dated as of November 16, 2004 between the Borrower and
the Trustee, in each case as the same may be amended, supplemented,
amended and restated or otherwise modified from time to
time.
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" Notes " is defined in the third
recital .
" Obligations " means any and all
obligations with respect to the payment of (a) any principal of or
interest (including interest accruing on or after the commencement
of any Insolvency Proceeding, whether or not a claim for
post-filing interest is allowed in such proceeding) or premium on
any Indebtedness, including any reimbursement obligation in respect
of any letter of credit, (b) any fees, indemnification obligations,
damages, expense reimbursement obligations or other liabilities
payable under the documentation governing any Indebtedness, (c) any
obligation to post cash collateral in respect of letters of credit
and any other obligations and (d) any Cash Management Obligations
or Hedging Obligations.
" Obligors " means the Borrower and each
of its Subsidiaries that is party from time to time to any First
Priority Document or Noteholder Document.
" Person " means any natural person,
corporation, partnership, limited liability company, trust,
association, governmental authority or unit, or any other entity,
whether acting in an individual, fiduciary or other
capacity.
" Recovery " is defined in Section
6.5 .
" Standstill Period " is defined in
Section 3.1 .
" Subsidiary " means, with respect to any
Person, a corporation, partnership, limited liability company or
other entity of which such Person and/or its other Subsidiaries
own, directly or indirectly, such number of outstanding shares or
other ownership interests as have more than 50% of the ordinary
voting power for the election of directors or other managers of
such corporation, partnership, limited liability company or other
entity.
" Trustee " shall include, in addition to
the Trustee defined in the preamble , the then acting
collateral agent under the Indenture and any successor thereto
exercising substantially the same rights and powers.
" Unasserted Contingent Obligations "
shall mean, at any time, Obligations for taxes, costs,
indemnifications, reimbursements, damages and other liabilities
(except for (i) the principal of and interest and premium (if any)
on, and fees relating to, any Indebtedness and (ii) contingent
reimbursement obligations in respect of amounts that may be drawn
under letters of credit) in respect of which no claim or demand for
payment has been made (or, in the case of Obligations for
indemnification, no notice for indemnification has been issued by
the indemnitee) at such time.
" Uniform Commercial Code " or "
UCC " means the Uniform Commercial Code (or any similar or
equivalent legislation) as in effect in any applicable
jurisdiction.
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1.2
Terms
Generally . The
definitions of terms herein shall apply equally to the singular and
plural forms of the terms defined. Whenever the context may
require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words " include ", "
includes " and " including " shall be deemed to be
followed by the phrase " without limitation ." The word
"will" shall be construed to have the same meaning and effect as
the word "shall". Unless the context requires otherwise (a) any
definition of or reference to any agreement, document or other
writing herein shall be construed as referring to such agreement,
document or other writing as from time to time amended,
supplemented or otherwise modified, (b) any reference herein to any
Person shall be construed to include such Person's successors and
assigns to the extent that such successors and assigns are
permitted pursuant to the applicable agreement, (c) the words "
herein ", " hereof " and " hereunder ", and
words of similar import, shall be construed to refer to this
Agreement in its entirety and not to any particular provision
hereof, (d) all references herein to Exhibits or Sections shall be
construed to refer to Exhibits or Sections of this Agreement, (e)
the words " asset " and " property " shall be
construed to have the same meaning and effect and to refer to any
and all tangible and intangible assets and properties, including
cash, securities, accounts and general intangibles, (f) terms
defined in the UCC but not otherwise defined herein shall have the
same meanings herein as are assigned thereto in the UCC, (g)
reference to any law means such law as amended, modified, codified,
replaced or re-enacted, in whole or in part, and in effect on the
date hereof, including rules, regulations, enforcement procedures
and any interpretation promulgated thereunder and (h) underscored
references to Sections or clauses shall refer to those portions of
this Agreement, and any underscored references to a clause shall,
unless otherwise identified, refer to the appropriate clause within
the same Section in which such reference occurs.
Section 2.
Lien
Priorities .
2.1
Relative
Priorities . Notwithstanding the date, manner or order of
grant, attachment or perfection of any Lien granted to the Trustee
or the Noteholders on the Common Collateral or of any Lien granted
to the First Priority Lenders on the Common Collateral and
notwithstanding any provision of the UCC or any other applicable
law to the contrary, the fact that any First Priority Lien may have
been subordinated, voided, avoided, invalidated or lapsed, or any
other circumstance whatsoever, the Trustee, on behalf of itself and
the Noteholders, hereby agrees that: (i) any Lien on the Common
Collateral securing the First Priority Claims now or hereafter held
by the First Priority Lenders shall be first in priority to any
Lien on the Common Collateral securing the Noteholder Claims; and
(ii) any Lien on the Common Collateral now or hereafter held by the
Trustee or the Noteholders regardless of how acquired, whether by
grant, statute, operation of law, subrogation or otherwise, shall
be second in priority in all respects to all Liens on the Common
Collateral securing the First Priority Claims. All Liens on the
Common Collateral securing the First Priority Claims shall be and
remain first in priority to all Liens on the Common Collateral
securing the Noteholder Claims for all purposes, whether or not
such First Priority Liens are subordinated to any Lien securing any
other obligation of any Obligor.
2.2
Prohibition on Contesting
Liens . Each of the Trustee, for itself and on behalf of
each Noteholder, and the Administrative Agent, for itself and on
behalf of each other First Priority Lender, agrees that it shall
not (and hereby waives any right to) contest or support any other
Person in contesting, in any proceeding (including any Insolvency
Proceeding), the priority, validity or enforceability of a Lien
held by the First Priority Lenders in the Common Collateral or by
the Noteholders in the Common Collateral, as the case may
be.
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2.3
No New Liens
. So long as the Discharge of First Lien
Obligations has not occurred, the parties hereto agree that the
Obligors shall not (i) grant or permit any additional Lien on any
asset or property to secure any Noteholder Claim unless it has
granted a Lien on such asset or property to secure the First
Priority Claims, and (ii) grant or permit any additional Lien on
any asset to secure any First Priority Claim unless it has granted
a Lien on such asset to secure the Noteholder Claims. To the extent
that the foregoing provisions are not complied with for any reason,
without limiting any other rights and remedies available to the
Administrative Agent and/or the First Priority Lenders, the
Trustee, on behalf of the Noteholders, agrees that any amounts
received by or distributed to any of them pursuant to or as a
result of Liens granted in contravention of this Section 2.3
shall be subject to Section 4.2 .
2.4
Similar Liens and
Agreements . The
parties hereto agree that it is their intention that the First
Priority Collateral and the Noteholder Collateral be identical. In
furtherance of the foregoing and of Section 8.10 , the
parties hereto agree, subject to the other provisions of this
Agreement:
(a)
upon request by the Administrative
Agent or the Trustee, to cooperate in good faith (and to direct
their counsel to cooperate in good faith) from time to time in
order to determine the specific items included in the First
Priority Collateral and the Noteholder Collateral and the steps
taken to perfect their respective Liens thereon and the identity of
the respective parties obligated under the First Priority
Collateral Documents and the Noteholder Collateral Documents;
and
(b)
that the documents and agreements
creating or evidencing the First Priority Collateral and the
Noteholder Collateral and guarantees for the First Priority Claims
and the Noteholder Claims shall be in all material respects the
same forms of documents other than with respect to the first lien
and the second lien nature of the Obligations
thereunder.
Section 3.
Enforcement
.
3.1
Exercise of
Remedies . (a)
So long as the Discharge of First Priority Claims has not occurred,
whether or not any Insolvency Proceeding has been commenced by or
against any Obligor, (i) the Trustee and the Noteholders will not
exercise or seek to exercise any rights or remedies (including the
exercise of any right of setoff or any right under any lockbox
agreement, account control agreement, landlord waiver or bailee's
letter or similar agreement or arrangement to which the Trustee or
any Noteholder is a party) with respect to
8
any Common
Collateral (and hereby waives any right to), institute any action
or proceeding with respect to such rights or remedies, including
any action of foreclosure, or contest, protest or object to any
foreclosure proceeding or action brought by the Administrative
Agent or any other First Priority Lender, any exercise of any right
under any control agreement in respect of a deposit account or
securities entitlement constituting Common Collateral, or any
bailee's letter or similar agreement or arrangement to which the
Trustee or any Noteholder is a party, or any other exercise by any
such party, of any rights and remedies relating to the Common
Collateral under the Noteholder Documents or otherwise, or object
to the forbearance by the Administrative Agent from bringing or
pursuing any foreclosure proceeding or action or any other exercise
of any right or remedy relating to the Common Collateral, in each
case so long as the respective interests of the Noteholders attach
to the proceeds thereof subject to the relative priorities
described in Section 2 and (ii) the Administrative Agent and
the other First Priority Lenders shall have the exclusive right to
enforce rights, exercise remedies (including the exercise of any
right of setoff or any right under any lockbox agreement, account
control agreement, landlord waiver or bailee's letter or similar
agreement or arrangement to which the Trustee or any Noteholder is
a party), refrain from enforcing or exercising remedies, and make
determinations regarding release or disposition of the Common
Collateral without the consent of or any consultation with the
Trustee or any Noteholder; provided that (A) in any
Insolvency Proceeding commenced by or against any Obligor, the
Trustee or any Noteholder may file a claim or statement of interest
with respect to the Noteholder Claims, (B) the Trustee or any
Noteholder may take any action not adverse to the Liens on the
Common Collateral securing the First Priority Claims or the rights
of the Administrative Agent or any other First Priority Lender to
exercise remedies in respect thereof in order to establish,
preserve, perfect or protect its rights in the Common Collateral
and (C) the Trustee and the Noteholders shall be entitled to (i)
file any necessary responsive or defensive pleading in opposition
to any motion, claim, adversary proceeding or other pleading made
by any person objecting to or otherwise seeking the disallowance of
the claims of the Noteholders, including without limitation any
claim secured by the Common Collateral, if any, in each case in
accordance with the terms of this Agreement, (ii) file any
pleadings, objections, motions or agreements which assert rights or
interests available to unsecured creditors of the Obligors arising
under the Bankruptcy Code, any similar law or any applicable
non-bankruptcy law, in each case in accordance with the terms of
this Agreement (iii) exercise any rights and remedies as an
unsecured creditor against the Borrower or any other Obligor in
accordance with the Noteholder Documents and applicable law, (iv)
bid (cash) for or purchase (for cash) Common Collateral at any
private or judicial foreclosure upon such Common Collateral
initiated by any secured party in respect thereof, (v) file any
notice of or vote any claim in any Insolvency Proceeding of any
Obligor in accordance with this Agreement and (vi) file any proof
of claim and other filings, appear and be heard on any matter in
connection therewith and make any arguments and motions that are,
in each case, in accordance with the terms of this Agreement, with
respect to the Noteholder Claims and the Noteholder Collateral, (D)
nothing herein shall be construed to limit or impair in any way the
right of the Trustee or the Noteholders to receive any remaining
Common Collateral and proceeds of Common Collateral after the
Discharge of First Priority Claims has occurred and (E)
notwithstanding anything to the contrary in this Section
3.1(a) , the Trustee and the Noteholders may exercise any or
all such rights and remedies and take or institute all such other
actions in respect of the Common Collateral and make such
determinations after the passage of a period of 180 days (the "
Standstill Period ") from the date of delivery of a notice
in writing to the Administrative Agent of their intention
to
9
exercise their
right to take such actions in respect of such Common Collateral;
provided further , however , that notwithstanding
anything herein to the contrary, in no event shall the Trustee or
any Noteholder exercise any rights or remedies or take such other
actions with respect to the Common Collateral as aforesaid if,
notwithstanding the expiration of the Standstill Period, the
Administrative Agent or any other First Priority Lender shall have
commenced and shall be diligently pursuing the exercise of any of
their rights or remedies with respect to the Common Collateral
(prompt notice of such exercise to be given to the Trustee). In
exercising rights and remedies with respect to the Common
Collateral, the Administrative Agent or any other First Priority
Lender may enforce the provisions of the Loan Documents and
exercise remedies thereunder, all in such order and in such manner
as they may determine in the exercise of their sole discretion.
Such exercise and enforcement shall include the rights of an agent
appointed by the Administrative Agent and the other First Priority
Lenders to sell or otherwise dispose of Common Collateral upon
foreclosure, to incur expenses in connection with such sale or
disposition, and to exercise all the rights and remedies of a
secured party under the UCC of any applicable jurisdiction and of a
secured creditor under bankruptcy or similar laws of any applicable
jurisdiction.
(b) The Trustee, on behalf of itself and the
Noteholders, agrees that it will not, in connection with the
exercise of any right or remedy (including the exercise of any
right of setoff or any right under any lockbox agreement, account
control agreement, landlord waiver or bailee's letter or similar
agreement or arrangement to which the Trustee or any Noteholder is
a party) with respect to any Common Collateral, take or receive any
Common Collateral or any proceeds of Common Collateral unless and
until the Discharge of First Priority Claims has occurred. Without
limiting the generality of the foregoing, unless and until the
Discharge of First Priority Claims has occurred, except as
expressly provided in the proviso in clause (a)(ii)
of Section 3.1 , the sole right of the Trustee and the
Noteholders as secured parties with respect to the Common
Collateral is to hold a perfected Lien on the Common Collateral
pursuant to the Noteholder Documents for the period and to the
extent granted therein and to receive a share of the proceeds
thereof, if any, after the Discharge of the First Priority Claims
has occurred.
(c) The Borrower agrees that it will not, and will
not permit any other Obligor to, in connection with the exercise of
any right or remedy with respect to any Common Collateral by the
Trustee or the Noteholders, transfer, deliver or pay, as
applicable, to the Trustee or any Noteholder any Common Collateral
or any proceeds of Common Collateral unless and until the Discharge
of First Priority Claims has occurred.
(d) Subject to the proviso in clause
(a)(ii) of Section 3.1 , (i) the Trustee, for itself and
on behalf of the Noteholders, agrees that the Trustee and the
Noteholders will not take any action that would hinder or cause to
delay any exercise of remedies undertaken by the Administrative
Agent or any other First Priority Lender under the Loan Documents
as secured parties in respect of any Common Collateral, including
any sale, lease, exchange, transfer or other disposition of the
Common Collateral, whether by foreclosure or otherwise, and (ii)
the Trustee, for itself and on behalf of the Noteholders, hereby
waives any and all rights it or the Noteholders may have as a
junior lien creditor or otherwise (whether arising under the UCC or
any other law) to ob
