Subordination of rights of Borrower Clause Samples
The Subordination of Rights of Borrower clause establishes that the borrower's rights in relation to certain assets or claims are ranked below the rights of another party, typically the lender or a senior creditor. In practice, this means that if the borrower has any claims to payments or proceeds from collateral or other sources, those claims will only be satisfied after the senior party's claims have been fully met. For example, if the borrower is entitled to receive funds from a third party, the lender's right to those funds will take precedence. This clause is essential for protecting the lender's interests by ensuring their claims are prioritized, thereby reducing their risk in the event of default or insolvency.
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Subordination of rights of Borrower. All rights which the Borrower at any time has (whether in respect of the Loan or any other transaction) against any Owner or its assets shall be fully subordinated to the rights of the Creditor Parties under the Finance Documents; and in particular, the Borrower shall not during the Security Period:
(a) claim, or in a bankruptcy of any Owner or prove for any amount payable to the Borrower by an Owner, whether in respect of the Loan or any other transaction;
(b) take or enforce any Security Interest for any such amount; or
(c) claim to set-off any such amount against any amount payable by the Borrower to any Owner.
Subordination of rights of Borrower. All rights which the Borrower at any time has against any Guarantor or its assets shall be fully subordinated to the rights of the Lender under the Finance Documents; and in particular, the Borrower shall not during the Security Period:
(a) claim, or in a bankruptcy of any Guarantor prove for, any amount payable to the Borrower by a Guarantor, whether in respect of this or any other transaction;
(b) take or enforce any Security Interest for any such amount; or
(c) claim to set-off any such amount against any amount payable by the Borrower to any Guarantor.
Subordination of rights of Borrower. From and after the Drawdown Date, all rights which the Borrower at any time has (whether in respect of the on-lending of the Loan or any other transaction) against any Owner or the Shareholder Guarantor or any of their assets shall be fully subordinated to the rights of the Creditor Parties under the Finance Documents and Master Agreements; and in particular, the Borrower shall not during the Security Period:
(a) claim, or in a bankruptcy of any Owner of the Shareholder Guarantor prove for, any amount payable to the Borrower by any Owner or the Shareholder Guarantor, whether in respect of the on-lending of the Loan or any other transaction;
(b) take or enforce any Security Interest for any such amount;
(c) claim to set-off any such amount against any amount payable by the Borrower to any Owner or the Shareholder Guarantor; or
(d) claim any subrogation or other right in respect of any Finance Document or any Master Agreement or any sum received or recovered by any Creditor Party under a Finance Document or any Master Agreement, Provided that this Clause 12.4 shall not prohibit the Borrower from receiving payment or performance in respect of any such right in the absence of any continuing Event of Default or Potential Event of Default.