STATUS OF COLLATERAL IN EVENT OF DEFAULT. Notwithstanding the terms of any Mortgage or other security instrument securing repayment of the Obligations by which Borrower assigns to Administrative Agent for the ratable benefit of Lenders the proceeds from the sale of production accruing to the Mortgaged Properties, so long as no Default or Event of Default has occurred that is continuing, Borrower shall be permitted to continue to receive from the purchasers of production all proceeds from the sale of production, and Administrative Agent shall not request that such proceeds be paid to Administrative Agent. Upon the occurrence and continuation of any Event of Default, Administrative Agent, at the request of Required Lenders, may direct the Persons
STATUS OF COLLATERAL IN EVENT OF DEFAULT. (a) Notwithstanding the terms of any Mortgage or other security instrument securing repayment of the Obligations by which the Borrowers assign to Agent for the ratable benefit of the Banks the "proceeds of runs" accruing to the Mortgaged Properties, so long as no Event of Default has occurred which is continuing, the Borrowers shall be permitted to continue to receive from the purchasers of production all of such "proceeds of runs", and Agent shall not request payment of such "proceeds of runs". Upon the occurrence and continuation of any Event of Default, Agent, at the request of the Majority Banks, may exercise all rights granted it under the various Mortgages to direct the Persons purchasing the production from the Borrowers' oil and gas properties to pay the proceeds of sale directly to Agent. Upon the occurrence and continuation of any Event of Default, Agent, after giving written notice to the Borrowers and to the Banks of the action to be taken, also may at any time or times thereafter sell, assign, and deliver all or any part of the Collateral, or any substitution therefor or any additions thereto as provided hereafter. Any sale or assignment may be at any public or private sale at the option of Agent, without advertisement or any notice to the Borrowers or any other Person except those required by applicable law (the Borrowers hereby agreeing that 10 days' notice constitutes "reasonable notice"); and each Bank may bid and become a purchaser at any such sale. Sales hereunder may be at such time or times, place or places, for cash or credit, and upon such terms and conditions as Agent may determine in its sole discretion. Upon the completion of any sale, Agent shall execute all instruments of transfer necessary to vest in the purchaser title to the property sold, and shall deliver to the purchaser any of the property so sold which may be in the possession of Agent.
(b) In the case of any sale of all or part of the Collateral, the purchase money proceeds and all other proceeds which then may be held or recovered by Agent for the benefit of the Banks, shall be applied in the following order:
(i) First, to the payment of the reasonable costs and expenses of the sale and of the collection or enforcement of the collateral, and reasonable compensation to Agent, its agents and attorneys, and of all reasonable expenses and liabilities incurred and advances made by Agent in connection therewith;
(ii) Second, to the payment of expenses of the Banks which the ...
STATUS OF COLLATERAL IN EVENT OF DEFAULT. Irrespective of the time, order or method of attachment, perfection or filing of liens or security interests in the Collateral granted to either of Secured Parties for either of the Notes, the net proceeds of any sale, enforcement or other disposition of any of the Collateral, following the occurrence of an Event of Default or the net proceeds of any distributions or credits received by a Secured Party following any marshaling of the assets of Borrower or a Subsidiary (whether in bankruptcy, reorganization, winding-up proceedings or similar proceedings, or otherwise), or following confirmation of a plan of arrangement or plan of reorganization of Borrower or a Subsidiary, shall be applied by Secured Parties or any of their respective agents, nominees or assigns, as follows:
(i) First, to the payment, of all costs and expenses incurred by a Secured Party including reasonable compensation to its agents and counsel;
(ii) Second, to the payment of the amounts due for principal of and interest on the Notes then outstanding, without preference or priority of such indebtedness owing to one Secured Party over another, or of principal over interest, or of interest over principal to the extent described in Section 1 hereof in accordance with the respective Percentage Interests of the Secured Parties;
(iii) Third, to the satisfaction of any subordinate lien or security interest in the Collateral to the extent required by law; and
(v) Fourth, to the payment to Borrower or a Subsidiary, its successors or assigns, or as a court of competent jurisdiction may direct, or otherwise as required by law, if any surplus is then remaining from such proceeds.
