Exhibit 10.3
INTERCREDITOR
AGREEMENT
(PENHALL)
INTERCREDITOR AGREEMENT (this
“ Agreement ”) dated as of November 1,
2005, by and among the First Lien Agent and the Second Lien Agent
(each as defined below).
W I T N E S S E T H:
WHEREAS, PENHALL INTERNATIONAL
CORP., an Arizona corporation (“ Holdings ”),
PENHALL COMPANY, a California corporation (“ Penhall
”), PENHALL LEASING, L.L.C., a California limited liability
company (“ Penhall Leasing ”), CAPITOL DRILLING
SUPPLIES, INC., an Indiana corporation (“ Capitol
Drilling ”) and BOB MACK CO., INC., a California
corporation (“ Bob Mack ” and together
with Holdings, Penhall, Penhall Leasing and Capitol Drilling,
together with their successors and assigns, including any receiver,
trustee or debtor-in-possession, individually a “
Borrower ” and collectively and jointly and severally,
the “ Borrowers ”), the Credit Parties (as
defined therein), the Lenders (as defined therein), and General
Electric Capital Corporation, as agent, are parties to an Amended
and Restated Credit Agreement, dated as of November 1, 2005
(as amended or otherwise modified from time to time, in accordance
with the terms of this Agreement, the “ GE Credit
Agreement ”), pursuant to which such Lenders have made
and will from time to time make loans and provide other financial
accommodations to the Borrowers;
WHEREAS, Holdings, the Lenders (as
defined therein) (together with their successors and assigns, the
“ Second Lien Lenders ”) and Deutsche Bank Trust
Company Americas, as agent (the “ Second Lien Agent
”), are parties to a Second Lien Credit Agreement dated
November 1, 2005 (as amended, restated, supplemented or
otherwise modified from time to time, in accordance with the terms
of this Agreement the “ Second Lien Loan Agreement
”) pursuant to which the Second Lien Lenders have made or
will make certain loans to Holdings;
WHEREAS, the Borrowers and the other
Obligors (as hereinafter defined) have granted to the First Lien
Agent, a lien on, and security interest in, substantially all of
their assets and properties, all as more particularly described in
the First Lien Loan Documents;
WHEREAS, the Borrowers and the other
Obligors have granted to the Second Lien Creditors a lien on, and
security interest in, substantially all of their assets and
properties, all as more particularly described in the Second Lien
Loan Documents;
WHEREAS, the Second Lien Creditors
and the First Lien Creditors wish to set forth their agreement as
to certain of their respective rights and obligations with respect
to the assets and properties of the Borrowers and the other
Obligors and their understanding relative to their respective
positions in certain assets and properties of the Borrowers and the
other Obligors; and
NOW, THEREFORE, in consideration of
the premises and the mutual covenants herein contained, the parties
hereto agree as follows:
Section 1.
Definitions.
1.1
General
Terms . As used in this
Agreement, the following terms shall have the respective meanings
indicated below, such meanings to be applicable equally to both the
singular and the plural forms of the terms defined:
“ Bankruptcy Code
” means the provisions of Title 11 of the United States Code,
11 U.S.C. §§101 et seq .
“ Borrower ”
shall have the meaning set forth in the recitals hereof.
“ Business Day ”
shall mean any day that is not a Saturday, a Sunday or a day on
which banks are required or permitted to be closed in the State of
New York.
“ Collateral ”
means all assets and properties of any kind whatsoever, real or
personal, tangible or intangible and wherever located, of any
Obligor, whether now owned or hereafter acquired, upon which a Lien
is now or hereafter granted or purported to be granted by such
Person in favor of a Secured Creditor, as security for all or any
part of the Obligations.
“ Distribution ”
means, with respect to any indebtedness or obligation, (a) any
payment or distribution by any Person of cash, securities or other
property, by set-off or otherwise, on account of such indebtedness
or obligation or (b) any redemption, purchase or other
acquisition of such indebtedness or obligation by any
Person.
“ Documents ”
means the First Lien Loan Documents and the Second Lien Loan
Documents, collectively.
“ Enforcement Action
” means (i) any action by any Secured Creditor to
foreclose on the Lien of such Person in any Collateral,
(ii) any action by any Secured Creditor to take possession of,
or sell or otherwise realize upon, or to exercise any other rights
or remedies with respect to, any Collateral, including a sale or
other disposition after the occurrence of an Event of Default of
any Collateral by an Obligor with the consent of, or at the
direction of, a Secured Creditor, (iii) the exercise of any
right of setoff with respect to, any Collateral of any Obligor or
the sale or other disposition of such Collateral and/or
(iv) the commencement by any Secured Creditor of any legal
proceedings or actions against or with respect to any Collateral of
any Obligor to facilitate the actions described in clauses (i),
(ii) and (iii) above, including any action to have the
automatic stay with respect to any Collateral lifted in any
Insolvency Proceeding of an Obligor; provided that the
filing of any notice of claim in any Insolvency Proceeding
involving an Obligor shall not be deemed to be an Enforcement
Action.
“ Event of Default
” means each “Event of Default” or similar term,
as such term is defined in any First Lien Loan Document or any
Second Lien Loan Document.
“ First Lien Agent
” means General Electric Capital Corporation in its capacity
as agent for the First Lien Creditors under the First Lien Loan
Documents, and its successors and assigns in such capacity
(including one or more other agents or similar contractual
representatives for one or more lenders that at any time succeeds
to or refinances, replaces or substitutes for any or all of the
First Lien Loan Obligations at any time and from time to
time).
“ First Lien Creditors
” means the First Lien Agent and the First Lien Lenders,
collectively.
“ First Lien Default
” shall mean any “Event of Default” under
the First Lien Loan Documents , or any condition or event that,
after notice or lapse of time or both, would constitute such an
Event of Default if that condition or event were not cured or
removed within any applicable grace or cure period set forth
therein.
“ First Lien Lenders
” means all lenders from time to time party to the First Lien
Loan Documents.
“ First Lien Letter of
Credit Obligations ” means all outstanding obligations
incurred by or owing to the First Lien Creditors, whether direct or
indirect, contingent or otherwise, due or not due, in connection
with the issuance of letters of credit by a First Lien Creditor or
another issuer pursuant to the First Lien Loan Documents or the
purchase of a participation with respect to any letter of credit,
including any unpaid reimbursement obligations in respect
thereof. The amount of such Letter of Credit Obligations
shall equal the maximum amount that may be payable at such time or
at any time thereafter by the First Lien Creditors thereupon or
pursuant thereto plus the amount thereof that are reimbursable to
the First Lien Creditors in respect of drawings under such letters
of credit.
“ First Lien Loan
Agreement ” means (i) the GE Credit Agreement and
(ii) each loan or credit agreement evidencing any replacement,
substitution, renewal, or refinancing for the Obligations under the
GE Credit Agreement which purports to be secured by the Collateral,
in each case as the same may from time to time be amended,
restated, supplemented, modified, replaced, substituted, renewed or
refinanced. in accordance with the terms of this
Agreement.
“ First Lien Loan
Documents ” means the First Lien Loan Agreement, all Loan
Documents (as such term is defined in the First Lien Loan
Agreement) and all other agreements, documents and instruments at
any time executed and/or delivered by any Obligor or any other
Person with, to or in favor of the First Lien Agent or any First
Lien Lender in connection therewith or related thereto, in each
case, as amended or otherwise modified from time to time in
accordance with the terms of this Agreement.
“ First Lien Loans
” means any loans or advances outstanding under the First
Lien Loan Documents.
“ First Lien Loan
Obligations ” means all obligations, liabilities and
indebtedness of every kind, nature and description owing by one or
more Borrowers or any other Obligor to the First Lien Creditors
evidenced by or arising under the First Lien Loan Documents
(including any First Lien Loans and First Lien Letter of Credit
Obligations), whether direct or indirect, absolute or contingent,
joint or several, due or not due, primary or secondary, liquidated
or unliquidated, including principal, interest, charges, fees,
costs, indemnities and reasonable expenses, however evidenced, and
whether as principal, surety, endorser, guarantor or otherwise,
whether now existing or hereafter arising, whether arising before,
during or after the initial or any renewal term of the First Lien
Loan Agreement whether arising before, during or after the
commencement of any Insolvency Proceeding with respect to one or
more of the Borrowers or any Obligor (and including the payment of
any principal, interest, fees, cost, expenses and other amounts
which would accrue and become due but for the commencement of such
Insolvency Proceeding whether or not such amounts are allowed or
allowable in whole or in part in any such Insolvency
Proceeding).
“ First Lien Loan
Termination Date ” means the date on which all First Lien
Loan Obligations have been Paid in Full.
“ GE Credit Agreement
” shall have the meaning set forth in the recitals
hereto.
“ Insolvency Proceeding
” means, as to any Obligor, any of the following:
(i) any case or proceeding with respect to such Person under
the Bankruptcy Code or any other Federal or State bankruptcy,
insolvency, reorganization or other law affecting creditors’
rights or any other or similar proceedings seeking any stay,
reorganization, arrangement, composition or readjustment of the
obligations and indebtedness of such Obligor, (ii) any
proceeding seeking the appointment of any trustee, receiver,
liquidator, custodian or other insolvency official with similar
powers with respect to such Obligor or any of its assets,
(iii) any proceeding for liquidation, dissolution or other
winding up of the business of such Obligor or (iv) any
assignment for the benefit of creditors or any marshalling of
assets of such Obligor.
“ Lien ” means
any mortgage, deed of trust, pledge, lien (statutory or otherwise),
security interest, charge or other encumbrance or security or
preferential arrangement of any nature, including any conditional
sale or title retention arrangement, any capitalized lease and any
assignment, deposit arrangement or financing lease intended as, or
having the effect of, security.
“ Maximum First Lien
Principal Amount ” means as of any date of determination
(x) $61,000,000 minus (y) the sum of all permanent reductions of
revolving loan commitments under the First Lien Loan Documents
after the date hereof (other than in connection with a refinancing
of a like amount of such commitments), provided that each advance
of a loan under the First Lien Loan Document and each letter of
credit issued under a First Lien Loan Document shall be within the
Maximum First Lien Principal Amount if, as of the date of the
making of such loan or of such issuance, and immediately after
giving effect thereto, the aggregate outstanding principal amount
of the First Lien Loan Obligations, including First Lien Letter of
Credit Obligations, does not exceed the Maximum First Lien
Principal Amount as of the date such loan was made or Letter of
Credit was issued.
“ Obligations ”
means the First Lien Loan Obligations and the Second Lien Loan
Obligations, collectively.
“ Obligor ” means
each Borrower and each other Person liable on or in respect of the
Obligations or that has granted a Lien on any property or assets as
collateral for the Obligations, together with such Person’s
successors and assigns, including a receiver, trustee or
debtor-in-possession on behalf of such Person.
“ Paid in Full ”
shall mean, with respect to any Obligations, that:
(a) all of such Obligations (other than contingent
indemnification obligations not yet due and payable) have been
indefeasibly paid, performed or discharged in full (with all such
Obligations consisting of monetary or payment obligations having
been paid in full in cash or cash equivalents acceptable to the
First Lien Lenders), (b) no Person has any further right to
obtain any loans, letters of credit, bankers’ acceptances, or
other extensions of credit under the documents relating to such
Obligations, and (c) any and all letters of credit,
bankers’ acceptances or similar instrument issued under such
documents have been cancelled and returned (or, to the extent
permitted by the applicable First Lien Loan Documents, backed by
stand-by guarantees or cash collateralized) in accordance with the
terms of such documents.
“ Permitted Collateral
Sale ” means (i) any sale or other disposition of
Collateral permitted under the First Lien Loan Agreement as in
effect on the date hereof and (ii) any other sale or other
disposition of Collateral permitted by the First Lien Creditors
having a sales price not exceeding $1,000,000 in the aggregate in
any fiscal year.
“ Person ” means
an individual, corporation, partnership, limited liability company,
limited liability partnership, association, joint-stock company,
trust, unincorporated organization, joint venture, governmental
authority or other regulatory body.
“ Purchase Notice
” shall have the meaning set forth in Section 6.1
.
“ Release Documents
” shall have the meaning set forth in Section 3.5
.
“ Release Event ”
means, with respect to any Collateral, the occurrence and
continuance of an Event of Default and the taking of any
Enforcement Action by the First Lien Creditors against such
Collateral or, after the occurrence and during the continuance of
an Insolvency Proceeding by or against any Obligor, the entry of an
order of the Bankruptcy Court pursuant to Section 363 of the
Bankruptcy Code authorizing the sale of such Collateral.
“Second Lien
Agent” shall have
the meaning set forth in the recitals hereto and shall include its
successors and assigns (including one or more other agents or
similar contractual representatives for one or more lenders that at
any time succeeds to or refinances, replaces or substitutes for any
or all of the Obligations under the Second Lien Loan Agreement at
any time and from time to time).
“Second Lien
Creditors” means
the Second Lien Agent and the Second Lien Lenders.
“ Second Lien Lenders
” shall have the meaning set forth in the recitals hereto and
shall include all lenders from time to time party to the Second
Lien Loan Documents.
“ Second Lien Loan
Agreement ” shall have the meaning set forth in the
recitals hereto and shall include each loan or credit agreement
evidencing any replacement, substitution, renewal, or refinancing
for the Obligations under the Second Loan Agreement in accordance
with the terms of this Agreement which purports to be secured by
the Collateral, in each case as the same may from time to time be
amended, restated, supplemented, modified, replaced, substituted,
renewed or refinanced. in accordance with the terms of this
Agreement.
“ Second Lien Loan Default
Notice ” means with respect to any Event of Default under
the Second Lien Loan Documents, a written notice from the Second
Lien Creditors to the First Lien Agent describing such Event of
Default in reasonable detail.
“ Second Lien Loan
Documents ” means the Second Lien Loan Agreement, all
Loan Documents (as such term is defined in the Second Lien Loan
Agreement) and all other agreements, documents and instruments at
any time executed and/or delivered by any Obligor or any other
Person with, to or in favor of the Second Lien Creditors in
connection therewith or related thereto, in each case, as amended
or otherwise modified from time to time in accordance with the
terms of this Agreement.
“ Second Lien Loan
Obligations ” means all obligations, liabilities and
indebtedness of every kind, nature and description owing by one or
more Borrowers or any other Obligor to one or more of Second Lien
Creditors evidenced by or arising under one or more of the Second
Lien Loan Documents, whether direct or indirect, absolute or
contingent, joint or several, due or not due, primary or secondary,
liquidated or un-liquidated, including principal, interest,
charges, fees, costs, indemnities and reasonable expenses, however
evidenced, whether as principal, surety, endorser, guarantor or
otherwise, whether now existing or hereafter arising, whether
arising before, during or after the initial or any renewal term of
the Second Lien Loan Agreement, whether arising before, during or
after the commencement of any Insolvency Proceeding with respect to
any Obligor (and including the payment of interest which would
accrue and become due but for the commencement of such Insolvency
Proceeding, whether or not such interest is allowed or allowable in
whole or in part in any such Insolvency Proceeding).
“ Secured
Creditors ” means the First Lien Creditors and the Second
Lien Creditors, collectively.
“ Standstill Period
” means the period during which the Second Lien Creditors are
not permitted to take Enforcement Action under
Section 4.1 commencing on the date of the occurrence of
an Event of Default under the Second Lien Loan Agreement and ending
(subject to the final proviso to Section 4.1 ), upon
the date which is 120 days after the First Lien Agent has received
a Second Lien Loan Default Notice with respect to such Event of
Default.
“ Uniform Commercial
Code ” means the Uniform Commercial Code as in effect
from time to time in the State of New York; provided ,
however , that, at any time, if by reason of mandatory
provisions of law, any or all of the perfection or priority of any
Secured Creditors’ security interest in any item or portion
of the Collateral is governed by the Uniform Commercial Code as in
effect in a jurisdiction other than the State of New York, the term
“Uniform Commercial Code” shall mean the Uniform
Commercial Code as in effect, at such time, in such other
jurisdiction for purposes of the provisions hereof relating to such
perfection or priority and for purposes of definitions relating to
such provisions.
1.2
Certain
Matters of Construction . The words
“hereof”, “herein” and
“hereunder” and words of similar import when used in
this Agreement shall refer to this Agreement as a whole and not to
any particular provision of this Agreement and
section references are to this Agreement unless otherwise
specified. For purposes of this Agreement, the following
additional rules of construction shall apply:
(i) wherever from the context it appears appropriate, each
term stated in either the singular or plural shall include the
singular and the plural, and pronouns stated in the masculine,
feminine or neuter gender shall include the masculine, the feminine
and the neuter; (ii) the term “including” shall
not be limiting or exclusive, unless specifically indicated to the
contrary; (iii) all references to statutes and related
regulations shall include any amendments of same and any successor
statutes and regulations; and (iv) unless otherwise specified,
all references to any instruments or agreements, including
references to any of this Agreement and the Documents, shall
include any and all modifications or amendments thereto and any and
all extensions or renewals thereof, in each case, made in
accordance with the terms hereof.
Section 2.
No New Liens
.
2.1
So long as the
First Lien Loan Obligations have not been Paid in Full, the
Borrowers agree that no Obligor shall (i) grant or permit any
additional Liens on any asset or property to secure any Second Lien
Loan Obligation unless (and the Second Lien Agent and each Second
Lien Lender shall not accept any such Lien unless) such Obligor has
granted a Lien on such asset or property to secure the First Lien
Loan Obligations and (ii) grant or permit any additional Liens
on any asset or property to secure any First Lien Loan Obligation
unless (and the First Lien Agent and each First Lien Lender shall
not accept any such Lien unless) such Obligor has granted a Lien on
such asset or property to secure the Second Lien Loan
Obligations. To the extent that the foregoing provisions of
this Section 2.1 are not complied with for any reason, without
limiting any other rights and remedies available to the First Lien
Agent and/or First Lien Lenders, Second Lien Agent on behalf of
itself and the Second Lien Lenders, agrees that any amounts
received by or distributed to any of them pursuant to or as a
result of Liens granted to any of them in contravention of this
Section 2.1 shall be subject to Section 3.4.
2.2
Similar Liens
and Agreements . The parties hereto
agree that it is their intention that the Collateral securing the
First Lien Loan Obligations and the Collateral securing the Second
Lien Loan Obligations be identical. In furtherance of the
foregoing, the parties hereto agree, subject to the other
provisions of this Agreement:
(a) upon request by the First
Lien Agent or the Second Lien Agent, 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
Collateral securing the First Lien Loan Obligations or Collateral
securing the Second Lien Loan Obligations and the steps taken to
perfect their respective Liens thereon and the identity of the
respective parties obligated under the First Lien Loan Credit
Documents and the Second Lien Loan Documents; and
(b) that
the documents and agreements creating or evidencing the Collateral
securing the First Lien Loan Obligations and the Collateral
securing the Second Lien Loan Obligations shall be in all material
respects the same forms of documents other than with respect to the
respective priorities thereof and the nature of the Obligations
thereunder, it being understood that the First Lien Agent shall
have exclusive control over all lockbox accounts, deposit accounts
and securities entitlements until the First Lien Loan Obligations
have been Paid in Full.
Section 3.
Security Interests;
Priorities.
3.1
Priorities
. Each
Secured Creditor hereby acknowledges that other Secured Creditors
have been granted Liens upon the Collateral to secure their
respective Obligations. The Liens of the First Lien Agent on
the Collateral, to the extent that such Liens secure the First Lien
Loan Obligations, have and shall be senior and prior in right to
the Liens of the Second Lien Creditors on the Collateral, and such
Liens of the Second Lien Creditors on the Collateral are and shall
be junior and subordinate to the Liens of the First Lien Agent, to
the extent that such Liens secure the First Lien Loan
Obligations. The priorities of the Liens provided in this
Section 3.1 shall not be altered or otherwise affected
by any amendment, modification, supplement, extension, renewal,
restatement, replacement or refinancing of any of the Obligations,
nor by any action or inaction which any of the Secured Creditors
may take or fail to take in respect of the Collateral.
3.2
No Alteration
of Priority. The priorities set
forth in this Agreement are applicable irrespective of the order or
time of attachment, or the order, time or manner of perfection, or
the order or time of filing or recordation of any document or
instrument, or other method of perfecting a Lien in favor of each
Secured Creditor in any Collateral, and notwithstanding any
conflicting terms or conditions which may be contained in any of
the Documents. Each First Lien Creditor agrees not to enter
in any agreement with another creditor of any Borrower or any
Obligor to subordinate the Lien of First Lien Creditors in any
Collateral under the First Lien Loan Documents to the Lien of such
other creditor in the Collateral, or to subordinate the right of
the First Lien Creditors to the payment of the First Lien Loan
Obligations to the payment of the indebtedness or claim of any
other creditor of any Borrower or any Obligor, in each case without
the prior written consent of Second Lien Creditors other than in
connection with bailee, landlord, control, consignment and similar
third parties letters that do not involve subordination to liens
securing indebtedness for borrowed money.
3.3
Perfection.
Subject to
Section 4.4, each Secured Creditor shall be solely responsible
for perfecting and maintaining the perfection of its Lien in and to
each item constituting the Collateral in which such Secured
Creditor has been granted a Lien. The foregoing provisions of
this Agreement are intended solely to govern the respective Lien
priorities as among the Secured Creditors and shall not impose on
any Secured Creditor any obligations in respect of the disposition
of proceeds of any Collateral that would conflict with prior
perfected claims therein in favor of any other Person or any order
or decree of any court or governmental authority or any applicable
law. Whether or not an Insolvency Proceeding is continuing,
each Secured Creditor agrees not to initiate, prosecute or
participate in any claim, action or other proceeding challenging
the enforceability, validity, perfection or priority of any or all
of the First Lien Loan Obligations or Second Lien Loan Obligations
or any Liens securing the First Lien Loan Obligations or Second
Lien Loan Obligations.
3.4
Proceeds of
Collateral. Subject to
Section 3.1 , all proceeds of the Collateral received
by any Second Lien Creditor in connection with or pursuant to an
Enforcement Action shall be forthwith paid over, in the funds and
currency received, to the First Lien Agent for application to the
First Lien Loan Obligations (except as otherwise required by law or
court order). Subject to Section 3.1 ,all
proceeds of the Collateral received by any First Lien Creditor
after the First Lien Loan Termination Date shall be forthwith paid
over, in the funds and currency received, to the Second Lien
Creditors for application to the Second Lien Loan
Obligations.
3.5
Release of
Collateral Upon Permitted Collateral Sale . The Second Lien
Creditors shall at any time in connection with any Permitted
Collateral Sale: (i) upon the request of the First Lien
Agent with respect to the Collateral subject to such Permitted
Collateral Sale, release or otherwise terminate its Liens on such
Collateral; (ii) deliver such terminations of financing
statements, partial lien releases, mortgage satisfactions and
discharges, endorsements, assignments or other instruments of
transfer, termination or release (collectively, “ Release
Documents ”) and take such further actions as the First
Lien Agent shall reasonably require in order to release and/or
terminate such Second Lien Creditor’s Liens on the Collateral
subject to such Permitted Collateral Sale; provided that if
the closing of the sale or disposition of the Collateral is not
consummated, the First Lien Agent shall promptly return all Release
Documents to such Second Lien Creditor; and (iii) be deemed to
have consented under the Second Lien Loan Documents to such sale or
other disposition free and clear of such Second Lien
Creditor’s security interest, it being understood that such
Second Lien Creditor still, but subject to this Agreement, has
rights with respect to the proceeds of such Collateral (and waived
any provision of the Second Lien Loan Documents to the extent such
transaction would be otherwise prohibited under such
provision).
3.6
Release of
Collateral Upon Release Event . Each Second Lien
Creditor shall, at any time in connection with a Release Event with
respect to any Collateral: (i) upon the request of the
First Lien Agent with respect to the Collateral subject to such
Release Event (which request will specify the proposed terms of the
sale and the type and amount of consideration expected to be
received in connection therewith), release or otherwise terminate
its Liens on such Collateral, to the extent such Collateral is to
be sold or otherwise disposed of either by (A) the First Lien
Agent or its agents or representatives, or (B) any Obligor
with the consent of the First Lien Creditors; (ii) be deemed
to have consented under the Second Lien Loan Documents to such sale
or other disposition free and clear of such Second Lien
Creditor’s security interest, it being understood that such
Second Lien Creditor still, but subject to this Agreement, has
rights with respect to the proceeds of such Collateral (and waived
the provisions of the Second Lien Loan Documents to the extent
necessary to permit such transaction); and (iii) deliver such
Release Documents and take such further actions as First Lien Agent
may reasonably require in connection therewith; provided
that, (A) such release by the Second Lien Creditors shall not
extend to or otherwise affect any of the rights of the Second Lien
Creditors to the proceeds from any such sale or other disposition
of Collateral, (B) the First Lien Creditors shall promptly
apply such proceeds to permanently repay the First Lien Loan
Obligations until the same have been Paid in Full, (C) after
such application, the First Lien Agent shall, subject to
Section 3.1 , promptly deliver any excess
proceeds from such sale or disposition of such Collateral to the
Second Lien Agent for application to the Second Lien Loan
Obligations or as otherwise required under applicable law or as a
court of competent jurisdiction may direct and (D) no such
release and/or authorization documents shall be delivered
(1) to any Obligor or (2) less than two or more than 10
Business Days prior to the date of the closing of the sale or
disposition of such Collateral, provided further that
if the closing of the sale or disposition of the Collateral subject
to such Release Event is not consummated, the First Lien Agent
shall promptly return all Release Documents to such Second Lien
Creditor.
3.7
Power of
Attorney . The Second Lien
Agent, on behalf of each Second Lien Creditor, hereby irrevocably
constitutes and appoints the First Lien Agent and any officer of
First Lien Agent, with full power of substitution, as its true and
lawful attorney-in-fact with full irrevocable power and
authority
in the place and stead of
the Second Lien Agent and in the name of the Second Lien Agent or
in the First Lien Agent’s own name, from time to time in the
First Lien Agent’s discretion, for the purpose of carrying
out the terms of Sections 3.5 and 3.6 hereof, to take any and all
appropriate action and to execute any and all documents and
instruments which may be necessary or desirable to accomplish the
purposes of such Section, including any Release Documents, and, in
addition, to take any and all other appropriate and commercially
reasonable action for the purpose of carrying out the terms of such
Sections. Each Second Lien Creditor hereby ratifies all that
said attorneys shall lawfully do or cause to be done pursuant to
the power of attorney granted in this Section 3.7. No
Person to whom this power of attorney is presented, as authority
for First Lien Agent to take any action or actions contemplated
hereby, shall be required to inquire into or seek confirmation from
any Second Lien Creditor as to the authority of First Lien Agent to
take any action described herein, or as to the existence of or
fulfillment of any condition to this power of attorney, which is
intended to grant to First Lien Agent unconditionally the authority
to take and perform th