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INTERCREDITOR AGREEMENT (PENHALL)

Intercreditor Agreement

INTERCREDITOR AGREEMENT   (PENHALL) | Document Parties: PENHALL INTERNATIONAL CORP | PENHALL COMPANY | PENHALL LEASING, L.L.C | CAPITOL DRILLING SUPPLIES, INC | BOB MACK CO., INC You are currently viewing:
This Intercreditor Agreement involves

PENHALL INTERNATIONAL CORP | PENHALL COMPANY | PENHALL LEASING, L.L.C | CAPITOL DRILLING SUPPLIES, INC | BOB MACK CO., INC

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Title: INTERCREDITOR AGREEMENT (PENHALL)
Governing Law: New York     Date: 11/4/2005
Law Firm: General Electric Capital Corporation; King & Spalding LLP; Cahill Gordon & Reindel LLP    

INTERCREDITOR AGREEMENT   (PENHALL), Parties: penhall international corp , penhall company , penhall leasing  l.l.c , capitol drilling supplies  inc , bob mack co.  inc
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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


 
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