Exhibit T3C-4
INTERCREDITOR AND SUBORDINATION AGREEMENT
THIS INTERCREDITOR AND SUBORDINATION AGREEMENT, dated as of February
__, 2000 (as amended, restated or otherwise modified from time to time, this
"AGREEMENT"), among THE CIT GROUP/BUSINESS CREDIT, INC., as agent (together with
its successors and assigns in such capacity, the "SENIOR AGENT") pursuant to the
CR Senior Credit Agreement (as hereinafter defined), BAY HARBOUR MANAGEMENT
L.C., as lender (together with its successors and assigns, the "BH SENIOR
LENDER") under the BH Senior Credit Agreement (as hereinafter defined), UNITED
STATES TRUST COMPANY OF NEW YORK as trustee under the Junior Subordinated
Indenture (as hereinafter defined) acting on behalf of the noteholders
thereunder (together with its successors and assigns in such capacity, the
"JUNIOR SUBORDINATED TRUSTEE") and [LIST PRINCIPAL PIK NOTEHOLDERS] (together
with their successors and assigns, collectively, the "JUNIOR SUBORDINATED
PRINCIPAL LENDERS") under the Junior Subordinated Indenture (as hereinafter
defined).
RECITALS:
WHEREAS, Planet Hollywood International, Inc. ("PHI"), and the other
entities listed on Schedule 1 hereto (herein being referred to collectively as
the "COMPANY"), CIT, Rothschild Recovery Fund, L.P. and various financial
institutions as may from time to time become parties thereto (collectively, the
"CR SENIOR LENDERS") and the Senior Agent are entering into a Revolving Credit
Agreement, dated as of the date hereof and the Guaranties (as hereinafter
defined) (in each case as amended, restated, supplemented, replaced or otherwise
modified from time to time in accordance with SECTION 3.10 hereof, the "CR
SENIOR CREDIT AGREEMENT");
WHEREAS, the CR Senior Obligations are secured by (a) first priority
liens on and security interests in substantially all of the assets (excluding
the BH First Priority Collateral) of the Company and the Subsidiary Guarantors
as more fully described on Schedule 2 (collectively, the "CR FIRST PRIORITY
COLLATERAL"), and (b) second priority liens on all real property of the Company
located at 0000 Xxxxxxxx, Xxx Xxxx, Xxx Xxxx and the other collateral listed on
and as more fully described on Schedule 3 (the "BH FIRST PRIORITY COLLATERAL"),
in each case pursuant to the CR Senior Security Agreements;
WHEREAS, the Company and the BH Senior Lender are entering into a
SENIOR NOTE CREDIT AGREEMENT, dated as of the date hereof (as amended, restated,
supplemented, replaced or otherwise modified from time to time in accordance
with SECTION 3.10, the "BH SENIOR CREDIT AGREEMENT");
WHEREAS, the BH Senior Obligations are secured by (a) second priority
liens on and security interests in substantially all of the CR First Priority
Collateral and (b) first priority liens on all of the BH First Priority
Collateral, in each case pursuant to the BH Senior Security Agreements; and
WHEREAS, the Company, the Junior Subordinated Trustee, the Junior
Subordinated Principal Lenders and certain other persons (the Junior
Subordinated Principal Lenders and such other persons, together with their
successors and assigns, collectively the "JUNIOR SUBORDINATED LENDERS") are
entering into a Junior Subordinated Indenture dated the date hereof (as amended,
restated, supplemented, replaced or otherwise modified from time to time in
accordance with SECTION 3.10 hereof, the "JUNIOR SUBORDINATED INDENTURE");
WHEREAS, the Junior Subordinated Obligations are secured by third
priority liens and security interests in all the Intercreditor Collateral (as
hereinafter defined) pursuant to the Junior Subordinated Credit Documents (as
hereinafter defined);
WHEREAS, the Junior Subordinated Obligations are junior and
subordinate in right of payment in full of the CR Senior Obligations and the BH
Senior Obligations;
WHEREAS, the Intercreditor Parties are entering into this Agreement in
order to, among other things, (a) confirm (i) the first priority security
interests and liens of the Senior Agent in the CR First Priority Collateral,
(ii) the second priority security interests and liens of the Senior Agent in the
BH First Priority Collateral, (iii) the second priority security interest of the
BH Senior Lender in the CR First Priority Collateral and (iv) the first priority
security interest of the BH Senior Lender in the BH First Priority Collateral
(the "CR First Priority Collateral" and the "BH First Priority Collateral" being
collectively referred to as the "INTERCREDITOR COLLATERAL") and (b) provide for
the relative rights of the Intercreditor Parties, in connection with the
enforcement of their security interests in the Intercreditor Collateral.
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants herein contained, and for other good and valuable consideration, each
of the Senior Agent, the BH Senior Lender, the Junior Subordinated Trustee and
the Junior Subordinated Lenders hereby agree as follows:
ARTICLE I
DEFINITIONS
SECTION 1.1 CERTAIN DEFINITIONS. The following terms when used in this
Agreement shall have the following meanings:
"AGREEMENT" is defined in the PREAMBLE hereto.
"APPLICABLE LAW" means any law of the United States or any other
jurisdiction where any Intercreditor Collateral is located or any Obligor
operates, including, without limitation, the UCC.
"BANKRUPTCY CODE" means Title 11 of the United States Bankruptcy Code
(11 U.S.C. 101 et seq), as amended from time to time and any successor statute.
"BH COLLATERAL" means the assets of the Company and the Guarantors
listed on Schedules 2 and 3.
"BH COLLATERAL PROCEEDS" is defined in SECTION 1.2(A) hereof.
"BH FIRST PRIORITY COLLATERAL" is defined in SECOND RECITAL hereto.
"BH SCHEDULED PAYMENTS" [to come]
"BH SENIOR CREDIT DOCUMENTS" collectively means the BH Senior Credit
Agreement, the BH Senior Security Agreements and all documents, instruments and
agreements now or hereafter executed and/or delivered in connection therewith,
as the same may be amended, restated, supplemented, replaced or otherwise
modified from time to time in accordance with SECTION 3.10 hereof.
"BH SENIOR LENDERS" is defined in the PREAMBLE hereto.
"BH SENIOR OBLIGATIONS" means the principal of, and premium, if any,
payable on redemption or prepayment of, and interest on, all indebtedness and
all other obligations now existing or hereafter incurred under the BH Senior
Credit Documents, up to $22,000,000 including without limitation, all fees,
expenses, claims, charges and indemnity obligations (on an aggregate basis not
to exceed $____________).
"BH SENIOR SECURITY AGREEMENTS" collectively means all of the
agreements specified on ANNEX II hereto and each other guaranty, security
agreement, mortgage, deed of trust or other collateral agreement now or
hereafter entered into in connection with the BH Senior Obligations, the same
may be as amended, restated, supplemented, replaced or otherwise modified from
time to time in accordance with SECTION 3.10 hereof.
"BH/PIK CREDIT DOCUMENTS" collectively means the BH Senior Credit
Documents and the Junior Subordinated Credit Documents.
"BH/PIK GUARANTIES" collectively means all the guaranties forming a
part of the BH Senior Credit Documents or the Junior Subordinated Credit
Documents.
"BH/PIK LENDERS" collectively means the BH Senior Lenders, the Junior
Subordinated Trustee on behalf of the noteholders under the Junior Subordinated
Indenture and each of the Junior Subordinated Lenders.
"BH/PIK OBLIGATIONS" collectively means the BH Senior Obligations and
the Junior Subordinated Obligations.
"BH/PIK SECURITY AGREEMENTS" collectively means the BH Senior Security
Agreements and the Junior Subordinated Security Agreements.
"COMPANY" is defined in the FIRST RECITAL hereto.
"CR COLLATERAL" means the assets of the Company and the Guarantors
listed on Schedules 2 and 3.
"CR COLLATERAL PROCEEDS" is defined in SECTION 3.18 hereof.
"CR CREDIT DOCUMENTS" collectively means the CR Senior Credit
Agreement, the CR Senior Security Agreements and all documents, instruments and
agreements now or hereafter executed and/or delivered in connection therewith,
as the same may be amended, restated, supplemented, replaced or otherwise
modified from time to time in accordance with SECTION 3.10 hereof.
"CR FIRST PRIORITY COLLATERAL" is defined in the SECOND RECITAL
hereto.
"CR SENIOR CREDIT AGREEMENT" is defined in the FIRST RECITAL hereto.
"CR SENIOR LENDERS" is defined in the FIRST RECITAL hereto.
"CR SENIOR OBLIGATIONS" means the principal of, and premium, if any,
payable on redemption or prepayment of, and interest on, all indebtedness and
all other obligations now existing or hereafter incurred or owing under the CR
Credit Documents up to $16,500,000 plus, all fees, expenses, claims, charges and
indemnity obligations.
"CR SENIOR SECURITY AGREEMENTS" collectively means all of the
agreements specified on ANNEX I hereto and each other guaranty, security
agreement, pledge agreement, mortgage, deed of trust or other collateral
agreement now or hereafter entered into in connection with the CR Senior
Obligations, as the same may be as amended, restated, supplemented, replaced or
otherwise modified from time to time in accordance with SECTION 3.10 hereof.
"CREDIT DOCUMENTS" collectively means the CR Credit Documents and the
BH/PIK Credit Documents.
"GUARANTIES" collectively means the Senior Guaranties and the BH/PIK
Guaranties.
"GUARANTY ACTION" means any claim, demand, proceeding, action or act
against any guarantor pursuant to affecting or otherwise in connection with any
CR Senior Security Agreement.
"INSOLVENCY PROCEEDING" means (a) any insolvency or bankruptcy case or
proceeding, or any receivership, liquidation, reorganization or other similar
case or proceeding relative to PHI, any Obligor or any of their property or
assets, (b) any liquidation, dissolution, reorganization or winding up of PHI or
any Obligor, whether voluntary or involuntary and whether or not involving
insolvency or bankruptcy, or (c) any assignment for the benefit of creditors or
any other marshalling of assets and liabilities of PHI or any Obligor.
"INTERCREDITOR COLLATERAL" is defined in the SEVENTH RECITAL hereto,
together with all Proceeds therefrom.
"INTERCREDITOR PARTIES" collectively means the Senior Agent and the
BH/PIK Lenders.
"JUNIOR SCHEDULED PAYMENTS" mean [to come]
"JUNIOR SUBORDINATED CREDIT DOCUMENTS" means the Junior Subordinated
Indenture, the Junior Subordinated Security Agreements and all documents,
instruments and agreements executed and/or delivered in connection therewith, as
the same may be amended, restated, supplemented, replaced or otherwise modified
from time to time in accordance with SECTION 3.10 hereof.
"JUNIOR SUBORDINATED INDENTURE" is defined in the FIFTH RECITAL
hereto.
"JUNIOR SUBORDINATED LENDERS" is defined in the FIFTH RECITAL hereto.
"JUNIOR SUBORDINATED OBLIGATIONS" means the principal of, and premium,
if any, payable on redemption or prepayment of, and interest on, all
indebtedness and all other obligations now existing or hereafter incurred or
owing under, the Junior Subordinated Credit Documents, including without
limitation, all fees, expenses, claims, charges and indemnity obligations.
"JUNIOR SUBORDINATED PRINCIPAL LENDERS" is defined in the PREAMBLE
hereto.
"JUNIOR SUBORDINATED TRUSTEE" is defined in the PREAMBLE hereto.
"JUNIOR SUBORDINATED SECURITY AGREEMENTS" collectively means all of
the agreements specified on ANNEX III hereto and each other guaranty, security
agreement, pledge agreement, mortgage, deed of trust or other collateral
agreement now or hereafter entered into in connection with the Junior
Subordinated Obligations, as the same may be as amended, restated, supplemented,
replaced or otherwise modified from time to time in accordance with SECTION 3.10
hereof.
"LEGEND" is defined in SECTION 3.16 hereof.
"LIEN" means, with respect to any property or asset, any mortgage,
lien, pledge, charge, security interest or encumbrance of any kind in respect of
such property or asset.
"NOTEHOLDERS" means the holders of the Junior Subordinated
Obligations.
"OBLIGOR" means PHI and each of its subsidiaries that is obligated
under any CR Credit Documents or BH/PIK Credit Documents.
"PERMITTED ENFORCEMENT ACTION" means any Remedial Action taken by the
BH Senior Lenders with respect to the BH Collateral only.
"PHI" is defined in the FIRST RECITAL hereto.
"PROCEEDS" means "proceeds," as such term is defined in Section
9-306(1) of the UCC and, in any event, shall include without limitation, (a) any
and all proceeds of any insurance, indemnity, warranty or guaranty payable to
any Obligor from time to time with respect to any of the Intercreditor
Collateral, (b) any and all payments (in any form whatsoever) made or due and
payable to any Obligor from time to time in connection with any requisition,
confiscation, condemnation, seizure or forfeiture of all or any part of the
Intercreditor Collateral by any governmental authority, (c) any and all other
amounts from time to time paid or payable under or in connection with any of the
Intercreditor Collateral on account of any Guaranty Action or on account of any
Remedial Action and (d) the following types of property acquired with cash
Proceeds: accounts, chattel paper, contracts, documents, general intangibles,
equipment, investment property and inventory, as such terms are defined in the
UCC.
"REMEDIAL ACTION" means any claim, action, proceeding or agreement
(whether by judicial action, self help or otherwise) to foreclose upon, take
possession or control of, sell, lease, dispose of or otherwise realize or
protect upon any property or asset of the Company or any Guarantor, whether
pursuant to the UCC or other Applicable Law.
"SECURITY AGREEMENTS" collectively means the CR Senior Security
Agreements and the BH/PIK Security Agreements.
"SENIOR AGENT" is defined in the PREAMBLE hereto.
"SENIOR DEFAULT" is defined in SECTION 1.3 hereof.
"SENIOR GUARANTIES" means the guarantees forming a part of the CR
Credit Documents.
"SUBSIDIARY GUARANTORS" collectively means [_______________]. [PHI TO
PROVIDE A LIST OF GUARANTORS WHICH WILL EXCLUDE ONLY SHELL OR OTHER
NON-OPERATING ENTITIES WITH DI MINIMUS ASSETS.]
"UCC" means the Uniform Commercial Code as in effect from time to time
in the State of New York.
SECTION 1.1 A BH/PIK LENDERS LIEN SUBORDINATION. The BH/PIK Lenders
each hereby severally agrees that notwithstanding anything contained in the
BH/PIK Credit Documents or any other document or instrument evidencing or in any
way relating to the BH/PIK Obligations, the security interests and liens of the
BH/PIK Lenders in the CR First Priority Collateral is expressly "subordinate and
junior" to the lien of the CR Senior Lenders in the CR First Priority
Collateral. Except for the (x) BH Collateral Proceeds paid to the BH Senior
Lender or (y) payments of the Junior Scheduled Payments and the BH Scheduled
Payments made by the Company to the BH Senior Lender or to the Junior
Subordinated Trustee at such times required under the BH/PIK Credit Documents
(in effect on the date hereof), in each case, to the extent no Senior Default
under the CR Senior Credit Agreement shall have occurred and then be continuing
or would occur as a result of such payment, "subordinate and junior" shall mean
that until the CR Senior Obligations shall have been paid in full and satisfied
as more fully described herein, the BH/PIK Lenders shall not without the express
prior written consent of the CR Senior Lenders (A) demand, require or accept any
payments or prepayment of the BH/PIK Obligations, (B) enforce or take any action
to (x) enforce or collect the BH/PIK Obligations or any portion thereof (other
than, in the case of the BH Senior Lender, the Permitted Enforcement Action) or
(y) enforce any rights or remedies with respect to, or to realize upon, the CR
First Priority Collateral or (C) declare an event of default, accelerate or
exercise any remedies with respect thereto under the BH/PIK Credit Documents
except, in the case of the BH Senior Lender, for the Permitted Enforcement
Action.
SECTION 1.1 B JUNIOR SUBORDINATED LENDERS DEBT SUBORDINATION. On
behalf of the Noteholders, the Trustee hereby covenants and agrees that, to the
extent and in the manner hereinafter set forth, the payment of the Junior
Subordinated Obligations is hereby expressly made subordinate and subject in
right of payment to the prior payment in full in cash of all the CR Senior
Obligations (first) and the BH Senior Obligations (second) pursuant to the terms
of this Agreement unless and until the CR Senior Obligations and the BH Senior
Obligations shall have been indefeasibly paid in full and satisfied. The Junior
Subordinated Lenders will not, without the express prior written consent of the
Senior Agent (or the BH Senior Lenders when the CR Senior Lenders have been
indefeasibly paid in full), take demand or receive, and the Company or any
Guarantor will not make, give or permit, directly or indirectly, by set-off,
redemption, purchase or in any other manner, any payment on or security for the
whole or any part of the Junior Subordinated Obligations, and, without the
express prior written consent of the Senior Agent (or the BH Senior Lender when
the CR Senior Lenders have been indefeaibly paid in full), the Junior
Subordinated Lenders will not accelerate the scheduled maturities of any amounts
owing under the Junior Subordinated Obligations, PROVIDED, that the Company may
make, and the Junior Subordinated Lenders may demand and receive the Junior
Scheduled Payments so long as no Senior Default under the CR Credit Documents
shall have occurred and then be continuing, or would occur as a result of such
payment.
SECTION 1.2 NO PAYMENT UPON INSOLVENCY EVENT. During any Insolvency
Proceeding:
(a) the CR Senior Lenders shall receive payment in full in cash of all
amounts due on or to become due on or in respect of all CR Senior Obligations
(including any fees, costs and interest accruing thereon at the rate provided in
the CR Senior Credit Agreement after the commencement of any such Insolvency
Proceeding, whether or not such fees, costs and interests are allowed as a claim
against the Company and/or any Guaranty in such Insolvency Proceeding) before
the BH/PIK Senior Lenders receive or accept any payment or distribution, whether
by setoff, exercising contractual or statutory rights or otherwise and whether
in the form of cash, stock, property or otherwise, on account of the BH/PIK
Obligations; PROVIDED, HOWEVER, nothing set forth herein shall be deemed to
restrict or limit in any way, the rights of the BH Senior Lenders to receive
proceeds of the BH First Priority Collateral received pursuant to a Permitted
Enforcement Action (the "BH COLLATERAL PROCEEDS");
(b) any payment, transfer or other distribution of assets of the
Company (or of any Guarantor) of any kind or character, whether in the form of
cash, property, securities or otherwise, by set-off, exercising contractual or
statutory rights or otherwise (other than BH Collateral Proceeds to the BH
Senior Lender), to which the BH/PIK Senior Lenders would be entitled but for the
provisions of this SECTION 1.2, shall be paid by the Company, the Guarantor or
the liquidating trustee or agent or other person making such payment or
distribution, whether a trustee in bankruptcy, a receiver or liquidating trustee
or otherwise, directly to the Senior Agent on behalf of the CR Senior Lenders;
and
(c) to the extent any portion of (or payment in respect of) the CR
Senior Obligations (whether by or on behalf of the Company, as proceeds of
security or enforcement of any right of setoff or otherwise) is declared to be
fraudulent or preferential, set aside or required to be paid to any receiver,
trustee in bankruptcy, liquidating trustee, agent or other similar person under
any Insolvency Proceeding or in connection with any fraudulent conveyance or
similar law, then if such payment or incurrence of such obligation is recovered
by, or paid over to, such receiver, trustee in bankruptcy, liquidating trustee,
agent or other similar person, the CR Senior Obligations 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 provisions of this Section 1.2, in the event that
the BH/PIK Lenders shall receive any payment, transfer or distribution of assets
of the Company (or any Guarantor) of any kind or character, whether in the form
of cash, property, securities or otherwise (other than (x) the Junior Scheduled
Payments and the BH Scheduled Payments previously paid by the Company to the
extent paid in accordance with the terms hereof and (y) payments received by the
BH Senior Lender of BH Collateral Proceeds), before all the CR Senior
Obligations have been paid in full in cash and all commitments of the CR Senior
Lenders to make extensions of credit available to the Company have irrevocably
terminated, then such payment or distribution shall be held in trust for the
benefit of, and be immediately paid over to, the Senior Agent on behalf of the
CR Senior Lenders.
SECTION 1.3 NO PAYMENT WHEN CR SENIOR OBLIGATIONS IN DEFAULT. In the
event that any default or event of default (collectively, a "SENIOR DEFAULT")
has occurred under the Senior Credit Agreement, the BH/PIK Lenders shall not
receive or accept any BH Scheduled Payments or any Junior Scheduled Payments or
any other payment, transfer or distribution (other than payments received by the
BH Senior Lender of BH Collateral Proceeds), whether by setoff, exercising
contractual or statutory rights or otherwise and whether in the form of cash,
stock, property or otherwise, on account of the BH Senior Obligations until the
earlier to occur of (a) such Senior Default having been waived in writing by the
CR Senior Lenders or (b)(i) the CR Senior Obligations (including, without
limitation, amounts that have become and remain due by acceleration, together
with all costs, fees and any interest accruing thereon at the rate provided in
the Senior Credit Agreement) having been paid in full in cash and (ii) all the
commitments by the CR Senior Lenders to make credit extensions available to the
Company having been irrevocably terminated. Notwithstanding the foregoing, in
the event that the Company shall have made, or the BH/PIK Lenders shall have
received, any payment or distribution of assets of PHI or any of its
subsidiaries of any kind or character, whether in the form of cash, property,
securities or otherwise, at any time when prohibited by the foregoing provisions
of this Section 1.3 (other than payments received by the BH Senior Lender of BH
Collateral Proceeds), then in such event such payment shall be held in trust for
the benefit of, and be immediately paid over to, the Senior Agent on behalf of
the CR Senior Lenders.
SECTION 1.4 REMEDIES STANDSTILL. At any time while the BH/PIK Senior
Lenders are prohibited from obtaining or receiving any payment on the BH/PIK
Obligations, the BH/PIK Lenders shall not take, demand, xxx for, accelerate or
commence any remedial proceeding with respect to any amount that is payable on
account of the BH/PIK Obligations until (a) all of the CR Senior Obligations
have been paid in full in cash and (b) all the commitments by the CR Senior
Lenders to make credit extensions available to the Company have irrevocably
terminated; PROVIDED, HOWEVER, that (x) if the CR Senior Lenders have commenced
Remedial Action with respect to any material portion of the CR First Priority
Collateral, the BH/PIK Lenders shall immediately have the right to accelerate
the BH/PIK Obligations but shall be limited as to Remedial Action by the terms
hereof and (y) the BH Senior Lenders may pursue a Permitted Enforcement Action.
SECTION 1.5 WAIVER OF CERTAIN RIGHTS. Each of the BH/PIK Lenders (a)
hereby severally waives any and all rights to require the CR Senior Lenders (i)
to marshal any property or assets of the Company or of any Guarantor or (ii)
enforce any guaranty or any security interest or lien given by any guarantor or
other person to secure the payment of any or all of the CR Senior Obligations,
(b) shall not oppose, interfere or otherwise attempt to prevent or impair the CR
Senior Lenders from enforcing the security interests on any collateral securing
the repayment of the CR Senior Obligations and (c) shall not take, or permit to
be taken on its behalf, any action that is inconsistent with the terms hereof.
SECTION 1.6 NO AUTHORITY TO ACT DURING INSOLVENCY PROCEEDINGS. During
the pendency of any Insolvency Proceeding, the BH/PIK Lenders agree to take no
action unless such action is expressly permitted hereunder.
SECTION 1.7 [INTENTIONALLY LEFT BLANK]
SECTION 1.8 PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS. The
provisions of this Agreement are and are intended solely for the purpose of
defining the relative rights of the BH Senior Lenders, the Junior Subordinated
Lenders and the CR Senior Lenders. Nothing contained in this Agreement, in the
BH/PIK Credit Documents or elsewhere shall impair, as among the Company (or any
Guarantor), its creditors other than the CR Senior Lenders and the BH/PIK
Lenders, the obligations of the Company and any Guarantor, which are absolute
and unconditional, to pay the principal of, premium, if any, and, interest on
the CR Senior Obligations and the BH/PIK Obligations, in each case in accordance
with their respective terms.
SECTION 1.9 NO WAIVER OF SUBORDINATION PROVISIONS. No right of any
present or future CR Senior Lender or the Senior Agent to enforce the
subordination provisions provided herein shall at any time be prejudiced or
impaired in any manner by (x) any act or failure to act on the part of the
Company (or any Guarantor) or the BH/PIK Lenders, (y) any act or failure to act
by the CR Senior Lenders or the Senior Agent or (z) any noncompliance by the
Company or the BH/PIK Lenders with the terms, provisions and covenants of this
Agreement, regardless, in each case, of any knowledge thereof any CR Senior
Lender may have or be otherwise charged with.
SECTION 1.10 AMENDMENTS, ETC. No provision of this Agreement may be
amended, supplemented or otherwise modified in any respect without the consent
of all the CR Senior Lenders.
SECTION 1.11 SPECIFIC ENFORCEMENT.
(a) The provisions of this Agreement are intended for the benefit of,
and shall be enforceable directly by, the Senior Agent and the CR Senior Lender.
The BH/PIK Lenders acknowledge and agree that the terms of this Agreement are a
material inducement to the CR Senior Lenders to make the CR Senior Obligations
available to the Company, that the CR Senior Lenders would not have made the CR
Senior Obligations available to the Company without the benefit of the
provisions contained in this Agreement, and that the BH/PIK Lenders are
receiving substantial benefits as a result of the CR Senior Lenders making the
CR Senior Obligations available to the Company.
(b) Each CR Senior Lender and the Senior Agent is hereby authorized to
demand specific performance of the provisions of this Agreement, whether or not
the Company shall have complied with any of the provisions hereof applicable to
it, at any time when the BH/PIK Lenders shall have failed to comply with any of
such provisions applicable to it. The BH/PIK Lenders hereby irrevocably waive
any defense based on the adequacy of a remedy at law that might be asserted as a
bar to such remedy of specific performance, it being agreed that the CR Senior
Lenders will suffer irreparable harm if the terms of this Agreement are not
strictly enforced in accordance with its terms.
ARTICLE II
COLLATERAL ISSUES, ETC.
SECTION 2.1 REPRESENTATIONS AND WARRANTIES AS TO THIS AGREEMENT. Each
Intercreditor Party hereby represents and warrants for itself to the other
Intercreditor Parties hereto that (a) it has all requisite power and authority
to execute, deliver and perform this Agreement; (b) the execution, delivery and
performance by it of this Agreement has been duly authorized by all requisite
corporate or other action; (c) no consent or approval of any other person and no
consent, license, approval or authorization of any governmental authority is
required in connection with the execution, delivery and performance by it of
this Agreement; (d) the execution, delivery and performance by it of this
Agreement does not violate the CR Senior Credit Documents, the BH/PIK Credit
Documents, the [Plan, the Confirmation Order]; and (e) this Agreement
constitutes its legal, valid and binding obligation enforceable against each
such Intercreditor Party in accordance with its terms.
SECTION 2.2 CR FIRST PRIORITY COLLATERAL RIGHTS. Irrespective of (a)
the time, order, manner or method of creation, attachment or perfection of the
respective Liens granted by PHI or any Obligor to any Intercreditor Party in any
or all of the CR First Priority Collateral, (b) the time, manner or place of the
filing of the respective UCC financing statements or other applicable filings of
any Intercreditor Party with respect to any or all of the CR First Priority
Collateral, (c) any statement contained in any Credit Document, (d) any other
event, circumstance, occurrence or otherwise or (e) any provision of any
Applicable Law to the contrary, (i) the Liens granted by PHI or any Obligor to
the Senior Agent (for and on behalf of itself and the CR Senior Lenders) in and
to the CR First Priority Collateral shall be superior and prior to any Liens
granted by PHI or any other Obligor therein to the BH Senior Lenders and (ii)
the Liens granted by PHI or any Obligor to the BH Senior Lender in and to the CR
First Priority Collateral shall be superior and prior to any Liens granted by
PHI or any other Obligor therein to the Junior Subordinated Trustee or the
Junior Subordinated Lenders.
SECTION 2.3 BH FIRST PRIORITY COLLATERAL RIGHTS. Irrespective of (a)
the time, order, manner or method of creation, attachment or perfection of the
Liens granted by PHI or any other Obligor to any Intercreditor Party with
respect in any or all of the BH First Priority Collateral, (b) the time, manner
or place of filing of any mortgages or UCC financing statements or other
applicable filings by any Intercreditor Party with respect to any or all of the
BH First Priority Collateral, (c) any statement contained in any Credit
Document, (d) any other event, circumstance, occurrence or otherwise or (e) any
provision of any Applicable Law to the contrary, (i) the Liens granted by PHI
and the other Obligors to the BH Senior Lender in and to the BH First Priority
Collateral shall be superior and prior to any Liens granted by PHI or any other
Obligor therein to the Senior Agent, the CR Senior Lenders or the Junior
Subordinated Lenders and (ii) the Liens granted by PHI and the other Obligors to
the Senior Agent (for and on behalf of itself and the CR Senior Lenders) in and
to the BH First Priority Collateral shall be superior and prior to any Liens
granted by PHI or any other Obligor therein to the Junior Subordinated Trustee
or the Junior Subordinated Lenders.
SECTION 2.4 GUARANTY AND SUBORDINATION ACTION. (a) So long as the CR
Senior Obligations have not been paid in full or the commitments under the
Senior Credit Documents have not been terminated, the Senior Agent shall have
the sole and exclusive right to take or fail to take any Guaranty Action with
respect to each Guaranty in any manner deemed appropriate by the Senior Agent or
the CR Senior Lenders in its or their sole discretion (without regard to the
rights of the BH/PIK Lenders in any Subordinated Guaranty) that is consistent
with the terms of each such Guaranty, and the BH/PIK Lenders shall not take any
Guaranty Action with respect to any Subordinated Guaranty or seek to hinder,
delay, impede or seek judicial review of or jurisdiction over the method, manner
or actions of the Senior Agent or any CR Senior Lender in its pursuit of any
Guaranty Action with respect to each Guaranty.
(b) So long as the CR Senior Obligations have not been paid in full or
the commitments under the Senior Credit Documents have not been terminated, the
Senior Agent shall have the sole and exclusive right to take or fail to take any
Remedial Action in any manner deemed appropriate by the Senior Agent or the CR
Senior Lenders in its or their sole discretion (without regard to the BH Senior
Lenders) that is consistent with the terms hereof, and the BH Senior Lender
shall not take any Remedial Action or seek to hinder, delay, impede or seek
judicial review of or jurisdiction over the method, manner or actions of the
Senior Agent or any CR Senior Lender in its pursuit of any Remedial Action.
SECTION 2.5 [INTENTIONALLY LEFT BLANK]
SECTION 2.6 EXCLUSIVE ENFORCEMENT RIGHTS. (a) (i) The Senior Agent and
each CR Senior Lender shall have the exclusive right to carry out, or not to
carry out, the provisions of each CR Senior Security Agreement (as each such
agreement relates to the CR Collateral but not the BH Collateral) and Guaranty
and to exercise or not to exercise any Guaranty Action or Remedial Action in
connection therewith, all in the Senior Agent's and each CR Senior Lender's sole
discretion and in the exercise of its and their sole business judgment (without
regard to the rights of the BH/PIK Lenders under any Subordinated Credit
Document). Such exclusive rights shall include, specifically (but not by way of
limitation) (i) the right to sell or otherwise dispose of (or not take any such
action) any or all of the CR First Priority Collateral and to incur expenses in
connection therewith or (ii) the right to take or not take any Guaranty Action
with respect to any Guaranty, all as may be desirable in the Senior Agent's and
each CR Senior Lender's sole discretion to the extent provided in the relevant
CR Senior Security Agreements (only to the extent related to the CR Collateral)
and Guaranties, as the case may be. In exercising its rights as aforesaid, the
Senior Agent and each CR Senior Lender shall not have any duties, obligations or
liabilities to the BH/PIK Lenders.
(ii) The BH/PIK Lenders shall not, either directly or indirectly,
assert or exercise any Remedial Action in respect of all or any part of the CR
First Priority Collateral or any Lien thereon held by the BH/PIK Lenders or
exercise any Guaranty Action with respect to any Guaranty. The BH/PIK Lenders
agree not to take or receive from or on behalf of PHI or any other Obligor,
directly or indirectly, in cash or other property or by set-off or in any other
manner (whether pursuant to any enforcement, collection, execution, levy or
foreclosure proceeding or otherwise) any portion of the CR First Priority
Collateral or proceeds thereof, except as provided in SECTION 3.6 hereof.
Without limiting the generality of the foregoing, the sole right of the BH/PIK
Lenders (i) with respect to the CR First Priority Collateral is to hold a Lien
thereon granted pursuant to the BH/PIK Security Agreements and not exercise any
Remedial Action with respect thereto and (ii) with respect to each Subordinated
Guaranty to hold the same and not take any Guaranty Action with respect thereto
except as provided in SECTION 3.6 hereof.
(b) (i) The BH Senior Lender shall have the exclusive right to carry
out, or not to carry out, the provisions of each BH Senior Security Agreement
(as each such agreement relates to the BH First Priority Collateral but not the
CR Collateral) and to exercise or not to exercise any Remedial Action in
connection therewith, all in the BH Senior Lender's sole discretion and in the
exercise of its sole business judgment (without regard to the rights of the
Senior Agent, the CR Senior Lenders, the Junior Subordinated Trustee or the
Junior Subordinated Lenders under any of their respective Credit Documents).
Such exclusive rights shall include, specifically (but not by way of limitation)
the right to sell or otherwise dispose of (or not take any such action), any or
all of the BH First Priority Collateral and to incur expenses in connection
therewith, all as may be desirable in the BH Senior Lender's sole discretion to
the extent provided in the BH Senior Security Agreements (only those evidencing
BH First Priority Collateral). In exercising its rights as aforesaid, the BH
Senior Lender shall not have any duties, obligations or liabilities to any of
the Senior Agent, the CR Senior Lenders, the Junior Subordinated Trustee and the
Junior Subordinated Lenders, except as provided herein.
(ii) None of the Senior Agent, the CR Senior Lenders, the Junior
Subordinated Trustee and the Junior Subordinated Lenders shall, either directly
or indirectly, assert or exercise any Remedial Action in respect of all or any
part of the BH First Priority Collateral or any Lien thereon held by such party.
Each of the Senior Agent, the CR Senior Lenders, the Junior Subordinated Trustee
and the Junior Subordinated Lenders agrees not to take or receive from or on
behalf of PHI or any Obligor, directly or indirectly, in cash or other property
or by set-off or in any other manner (whether pursuant to any enforcement,
collection, execution, levy or foreclosure proceeding or otherwise) any portion
of the BH First Priority Collateral or proceeds thereof, except as provided in
SECTION 3.6 hereof. Without limiting the generality of the foregoing, the sole
right of each of the Senior Agent, the CR Senior Lenders, the Junior
Subordinated Trustee and the Junior Subordinated Lenders with respect to the BH
First Priority Collateral is to hold a Lien thereon granted pursuant to the CR
Senior Security Agreements or the Junior Subordinated Security Agreements, as
the case may be, and not exercise any Remedial Action with respect thereto.
ARTICLE III
OTHER AGREEMENTS
SECTION 3.1 RELEASES. (a) If the Senior Agent or any CR Senior Lender
releases any Lien on any part of the CR First Priority Collateral in connection
with any sale, lease, exchange, transfer or other disposition thereof in
accordance with the terms of the CR Credit Documents (not involving any Remedial
Action or Guaranty Action), the Liens of the BH/PIK Lenders shall be
automatically and unconditionally and simultaneously released [HANDLE TIA ISSUE]
and the BH/PIK Lenders shall execute and deliver to PHI and the Senior Agent
such termination statements, releases and other documents as the Senior Agent,
the CR Senior Lenders or PHI may reasonably request to effectively confirm such
release. All such disposition proceeds shall be applied as provided in the CR
Senior Credit Agreement. Notwithstanding the foregoing, the Senior Agent shall
endeavor to notify the Junior Subordinated Trustee of such proposed sale, lease,
exchange, transfer or other disposition and shall have been provided the
opportunity to purchase the Collateral to be sold, leased, exchanged,
transferred or otherwise disposed of on terms more favorable to PHI than those
offered as aforesaid; PROVIDED, HOWEVER, that neither the Senior Agent nor the
CR Senior Lender shall have any liability for a failure to provide such notice
and opportunity to purchase.
(b) If the BH Senior Lender releases any Lien on any part of the BH
First Priority Collateral in connection with any sale, lease, exchange, transfer
or other disposition thereof in accordance with the terms of the BH Senior
Credit Documents (not involving any Remedial Action or Guaranty Action), the
Liens of the Senior Agent, the CR Senior Lenders, the Junior Subordinated
Trustee and the Junior Subordinated Lenders shall be automatically and
unconditionally and simultaneously released and the Senior Agent, the CR Senior
Lenders, the Junior Subordinated Trustee and the Junior Subordinated Lenders
shall execute and deliver to PHI and the BH Senior Lender such termination
statements, releases and other documents as the BH Senior Lender or PHI may
reasonably request to effectively confirm such release. All such disposition
proceeds shall be applied as provided in the BH Senior Credit Agreement.
Notwithstanding the foregoing, the BH Senior Lenders shall endeavor to notify
the CR Senior Lenders and the Junior Subordinated Trustee of such proposed sale,
lease, exchange, transfer or other disposition and shall have been provided the
opportunity to purchase the Collateral to be sold, leased, exchanged,
transferred or otherwise disposed of on terms more favorable to PHI than those
offered as aforesaid; PROVIDED, HOWEVER, that the BH Senior Lenders shall have
no liability for a failure to provide such notice and opportunity to purchase.
SECTION 3.2 INSURANCE AND CONDEMNATION AWARDS. (a)(i) The Senior Agent
and the CR Senior Lenders shall have the sole and exclusive right as among the
Intercreditor Parties to adjust, settle, direct or otherwise deal with any
insurance policy or proceeds therefrom covering the CR First Priority Collateral
in the event of any loss thereunder and to approve any award granted in any
condemnation or similar proceeding affecting the CR First Priority Collateral.
(ii) All the proceeds of any insurance policies and any awards
relating to the CR Collateral shall (x) first, be paid exclusively to the Senior
Agent and applied as provided in the CR Senior Credit Agreement, and the BH/PIK
Lenders shall have no right, title or interest therein and (y) second, after all
amounts owing under the CR Credit Documents have been paid in full and the same
have been terminated, be paid as provided in SECTION 3.6.
(b) (i) The BH Senior Lender shall have the sole and exclusive right
as among the Intercreditor Parties to adjust, settle, direct or otherwise deal
with any insurance policy or proceeds therefrom covering the BH First Priority
Collateral in the event of any loss thereunder and to approve any award granted
in any condemnation or similar proceeding affecting the BH First Priority
Collateral.
(ii) All the proceeds of any insurance policies and any awards
relating to the BH First Priority Collateral shall (x) first, be paid
exclusively to the BH Senior Lender and applied as provided in the BH Senior
Credit Agreement, and none of the Senior Agent, the CR Senior Lenders, the
Junior Subordinated Trustee and the Junior Subordinate Lenders shall have any
right, title or interest therein and (y) second, after all amounts owing under
the BH Senior Credit Documents have been paid in full and the same have been
terminated, be paid as provided in SECTION 3.6 hereof.
SECTION 3.3 NO ADDITIONAL OBLIGATIONS. (a) The Senior Agent and the CR
Senior Lenders will be entitled to manage and supervise the CR Senior
Obligations and the CR Credit Documents in accordance with their sole and
absolute discretion, without regard to any of the rights or interests of the
BH/PIK Lenders (but subject to the terms of this Agreement).
(b) (i) The Senior Agent and the CR Senior Lenders shall have no
obligation whatsoever to the BH/PIK Lenders to assure the ownership, existence
or genuineness of any CR Collateral. The Senior Agent and the CR Senior Lenders
shall have no obligation whatsoever to the BH/PIK Lenders to preserve their
rights or benefits in any of the CR Collateral.
(ii) The BH Senior Lender shall have no obligation whatsoever to
any of the Senior Agent, the CR Senior Lenders, the Junior Subordinated Trustee
and the Junior Subordinated Lenders to assure the ownership, existence or
genuineness of any BH Collateral. The BH Senior Lenders shall have no obligation
whatsoever to the Senior Agent, the CR Senior Lenders, the Junior Subordinated
Trustee and the Junior Subordinated Lenders to preserve their rights or benefits
in any of the BH Collateral.
SECTION 3.4 WAIVERS. (a)(i) No right of the Senior Agent or any CR
Senior Lender to enforce the subordination with respect to any CR First Priority
Collateral or take Remedial Action in connection with the CR First Priority
Collateral, exercise any Guaranty Action in respect of the Guaranties or
exercise any Remedial Action, in each case as provided in this Agreement, shall
in any manner be prejudiced or impaired by any act or failure to act on the part
of PHI, any other Obligor or the Senior Agent or any CR Senior Lender, or by
any noncompliance by any person with the terms, provisions and covenants of this
Agreement, any of the CR Credit Documents or any of the BH/PIK Credit Documents,
regardless of any knowledge thereof which the Senior Agent or any CR Senior
Lender may have or be otherwise charged with.
(ii) No right of the BH Senior Lender to enforce the
subordination with respect to any BH First Priority Collateral or take Remedial
Action in connection with the BH First Priority Collateral as provided in this
Agreement, shall in any manner be prejudiced or impaired by any act or failure
to act on the part of PHI, any other Obligor or the BH Senior Lender, or by any
noncompliance by any person with the terms, provisions and covenants of this
Agreement or any of the BH/PIK Credit Documents, regardless of any knowledge
thereof which the BH Senior Lender may have or be otherwise charged with.
(b) (i) Each of the BH/PIK Lenders hereby waives, to the fullest
extent permitted by law, any claim it may have against the Senior Agent or any
CR Senior Lender (including, without limitation, any such claims under Sections
9-207, 9-506 and 9-507 of the UCC) arising out of or with respect to any action
which the Senior Agent or any CR Senior Lender may take or permit or omit to
take with respect to the CR Collateral pursuant to, and in accordance with the
terms of, this Agreement.
(ii) Each of the Senior Agent, the CR Senior Lenders, the Junior
Subordinated Lenders hereby waives, to the fullest extent permitted by law, any
claim it may have against the BH Senior Lender (including, without limitation,
any such claims under Sections 9-207, 9-506 and 9-507 of the UCC) arising out of
or with respect to any action which the BH Senior Lender may take or permit or
omit to take with respect to the BH Collateral pursuant to, and in accordance
with the terms of, this Agreement.
(c) (i) With respect to the CR First Priority Collateral, the BH/PIK
Lenders agree not to assert and hereby waive, to the fullest extent permitted by
law, any right to demand, request, plead or otherwise assert or otherwise claim
the benefit of, any marshalling, appraisement, valuation or other similar right
that may otherwise be available under any Applicable Law or any other similar
rights a junior secured creditor it may have under any Applicable Law.
(ii) With respect to the BH First Priority Collateral, each of
the Senior Agent, the CR Senior Lenders, the Junior Subordinated Trustee and the
Junior Subordinated Lenders agrees not to assert and hereby waives, to the
fullest extent permitted by law, any right to demand, request, plead or
otherwise assert or otherwise claim the benefit of, any marshalling,
appraisement, valuation or other similar right that may otherwise be available
under any Applicable Law or any other similar rights a junior secured creditor
it may have under any Applicable Law.
SECTION 3.5 INFORMATION CONCERNING PHI, ETC. Each Intercreditor Party
shall be responsible for keeping itself informed of (a) the financial condition
of PHI, the Obligors and all endorsers and/or guarantors of the BH/PIK
Obligations or the CR Senior Obligations, as the case may be, and (b) all other
circumstances bearing upon the risk of nonpayment of the BH/PIK Obligations or
the CR Senior Obligations, as the case may be. No Intercreditor Party shall have
any present or future duty or responsibility to any other Intercreditor Party to
advise them of information known to it regarding the financial condition of PHI
or any other Obligor or of any circumstances bearing upon the risk of nonpayment
of the BH/PIK Obligations or the CR Senior Obligations, as the case may be.
SECTION 3.6 APPLICATION OF PAYMENTS. (a) All proceeds arising from any
Remedial Action with respect to any CR First Priority Collateral or any Guaranty
Action shall be applied, FIRST, to the payment of the CR Senior Obligations
until they have been paid in full in cash SECOND, to the payment of the BH
Senior Obligations until they have been paid in full in cash, and THIRD, to the
payment of the Junior Subordinated Obligations until this Agreement is
terminated.
(b) All proceeds arising from any Remedial Action with respect to any
BH First Priority Collateral shall be applied, FIRST, to the payment of the BH
Senior Obligations until they have been paid in full in cash, SECOND, to the
payment of the CR Senior Obligations until they have been paid in full in cash,
and THIRD, to the payment of the Junior Subordinated Obligations until this
Agreement is terminated.
SECTION 3.7 INDEPENDENT DECISIONS. Each Intercreditor Party has,
independently and without reliance on any other Intercreditor Party, and in
reliance upon information supplied to it by PHI and the Obligors and upon such
other information as it has deemed appropriate, has made its own independent
decision to enter into its Credit Documents and to make the extensions of credit
contemplated thereunder; and each Intercreditor Party shall, independently and
without reliance upon any other Intercreditor Party, continue to make its own
independent analysis and decisions in acting or not acting under its Credit
Documents and this Agreement.
SECTION 3.8 TURNOVER OF PROHIBITED TRANSFERS. If any amount is
received by any Intercreditor Party in violation of the terms of this Agreement,
such amount shall, without the necessity of demand or request by any other
Intercreditor Party, be delivered forthwith by such Intercreditor Party to the
applicable Intercreditor Party entitled to receive the same for application to
payment of the CR Senior Obligations or BH/PIK Obligations, as the case may be,
in the form received, except for the addition of any endorsement or assignment
necessary to effect a transfer of all rights therein to such other party. Until
so delivered, any such amount shall be deemed received and held by the relevant
Intercreditor Party in trust for the Intercreditor Party entitled to receive the
same and shall not be commingled with other funds or property of such
Intercreditor Party.
SECTION 3.9 EFFECTIVENESS DURING INSOLVENCY PROCEEDING. This Agreement
shall continue in full force and effect notwithstanding any Insolvency
Proceeding.
SECTION 3.10 AMENDMENTS. No Intercreditor Party shall amend,
supplement or otherwise modify, without the consent of each other Intercreditor
Party, the terms of any of its Credit Documents, or enter into any other
agreement having the effect of doing so, in a manner that (a) is inconsistent in
any respect with the terms of this Agreement, (b) modifies the scope of the
Intercreditor Collateral. Other than the CR Senior Lender or the Senior Agent,
no Intercreditor Party shall be entitled to a first lien on any now or hereafter
acquired property of the Company or any its subsidiaries (except for the BH
Senior Lender with respect to the BH First Priority Collateral). In addition,
the Legend shall not be amended or modified in any respect.
SECTION 3.11 LIMITATION ON DECLARING DEFAULTS. Notwithstanding the
occurrence of any fact or circumstance that may result in any default or event
of default under any BH/PIK Credit Document, no BH/PIK Lender shall declare any
default or event of default thereunder. In addition, no BH/PIK Lender shall join
in any involuntary Insolvency Proceeding against PHI or any Obligor.
SECTION 3.12 DURATION AND TERMINATION; PAYMENT INVALIDATED. (a) This
Agreement shall constitute a continuing agreement and shall terminate with
respect to the Senior Agent and the CR Senior Lenders only upon written notice
by the Senior Agent to PHI, the BH Senior Lender and the Junior Subordinated
Trustee of the final and indefeasible payment in full in cash of all of the CR
Senior Obligations and the termination of the CR Credit Documents (such written
notice the Senior Agent agrees to give promptly (and, in any event, within three
(3) business days) after the occurrence of the foregoing). The termination of
this Agreement with respect to the Senior Agent and the CR Senior Lenders shall,
subject to CLAUSE (B), release fully and irrevocably such persons from any and
all liabilities, duties and responsibilities hereunder to the same extent as if
this Agreement had been fully terminated by all the parties hereto, PROVIDED
that the foregoing shall not release any of the parties with respect to any
obligations arising prior to such termination.
(b) In the event that this Agreement is terminated with respect to the
Senior Agent and the CR Senior Lenders, as provided in CLAUSE (A), and the
Senior Agent or any CR Senior Lender shall be required by a court or other
tribunal of competent jurisdiction to disgorge, refund, rebate or otherwise
return any amount received with respect to any of the Intercreditor Collateral,
any Senior Guaranty to any debtor-in-possession or trustee in respect of any
Insolvency Proceeding or any other person (whether as the result of such payment
constituting, or being alleged to constitute, a preference, a fraudulent
conveyance or any other payment required to be disgorged pursuant to any such
Insolvency Proceeding) then, in any such event, (i) the terms and conditions of
this Agreement shall be reinstated, notwithstanding any prior termination of
this Agreement pursuant to this Section, and (ii) all provisions of this
Agreement shall once again be operative until all such CR Senior Obligations are
again paid in full in cash.
(c) If both the BH Senior Obligations and Junior Subordinated
Obligations are outstanding at the time this Agreement is terminated with
respect to the Senior Agent and the CR Senior Lenders, the BH Senior Lender and
the Junior Subordinated Lenders shall continue to be subject to this Agreement
with respect to the Intercreditor Collateral on the same terms as provided in
this Agreement immediately prior to such termination with respect to the Senior
Agent and the CR Senior Lenders, except that (i) all references to the Senior
Agent, the CR Senior Lenders and the BH Senior Lender shall refer to the BH
Senior Lender and (ii) this Agreement shall be interpreted as if there were two
classes of Intercreditor Parties, with the Senior Agent, CR Senior Lenders and
the BH Senior Lender being, collectively, the senior class, and the Junior
Subordinated Trustee and the Junior Subordinated Lenders being be the junior
class (it being understood and agreed that, to the extent the BH Senior Lender
is prohibited from taking any action hereunder as it relates to the Senior Agent
and the CR Senior Lenders, such provisions shall be null and void as it relates
to the BH Senior Lender). Notwithstanding the foregoing sentence, with respect
to Guaranties and any Guaranty Action, the BH Senior Lender shall not have any
rights hereunder that are senior to those of the Junior Subordinated Trustee and
references to the Senior Agent and the Senior Lenders in respect of the
Guaranties and any Guaranty Action shall not refer to the BH Senior Lender.
[THIS PARAGRAPH TO BE MARKED UP BY WF&G TO REFLECT DISCUSSIONS.]
(d) In connection with the termination of this Agreement with respect
to the Senior Agent and the CR Senior Lenders, the Senior Agent shall transfer
the possession to the BH Senior Lender (if the BH Senior Obligations are
outstanding) or the Junior Subordinated Trustee (if the Junior Subordinated
Obligations are outstanding but no BH Senior Obligations are outstanding) any
Intercreditor Collateral it holds as bailee for the BH/PIK Lenders. No such
transfer shall be taken in violation of any applicable law, rule or regulation
or court order, and shall be taken at the sole cost and expense of the Company.
All such transfers shall be done without any representation or warranty by the
Senior Agent or the CR Senior Lenders and on an "as is, where is" basis, and
none of the CR Senior Lenders shall have any liability with respect thereto.
SECTION 3.13 NOTICE OF BH/PIK LENDERS INTERESTS. This Agreement
constitutes a written notification of demand to the Senior Agent by the BH/PIK
Lenders for the satisfaction of the indebtedness outstanding under the BH/PIK
Credit Documents that are secured by the Intercreditor Collateral for the
purposes of Section 9-504(1)(c) of the UCC, and the Senior Agent hereby waives
any rights that it might otherwise have under said Section to require the BH/PIK
Lenders to file any proof of their interest in the Intercreditor Collateral.
SECTION 3.14 CREDIT DOCUMENTS. Each Intercreditor Party confirms that
it has delivered to each other Intercreditor Party true and correct copies of
its Credit Documents, in each case as in effect on the date hereof, and all UCC
financing statements and other filings to perfect its security interest in the
Intercreditor Collateral.
SECTION 3.15 BAILEE FOR PERFECTION. For purposes of the UCC, each
BH/PIK Lender hereby appoints the Senior Agent as its bailee (and by its
execution hereof the Senior Agent accepts such appointment) to hold on its
behalf all the instruments and certificates forming a part of the Intercreditor
Collateral solely for the purpose of perfecting its Liens in the same pursuant
to the BH/PIK Security Agreements, subject to the terms and conditions of this
Agreement and otherwise on terms and conditions satisfactory to the Senior
Agent. Neither the Senior Agent nor any CR Senior Lender shall have by reason of
this Agreement or any other document a fiduciary relationship in respect of the
BH/PIK Lenders, nor shall the Senior Agent or any CR Senior Lender incur any
liabilities of any kind whatsoever to the BH/PIK Lenders by virtue of it acting
as bailee on behalf of the BH/PIK Lenders.
SECTION 3.16 LEGEND. The BH Senior Credit Agreement and any notes or
other evidences of indebtedness in connection therewith and the Junior
Subordinated Indenture and any notes or other evidence of indebtedness in
connection therewith shall contain a legend which shall read as follows:
THIS AGREEMENT IS SUBJECT TO AN INTERCREDITOR AND SUBORDINATION
AGREEMENT DATED AS OF FEBRUARY __, 2000 BY AND AMONG THE CIT
GROUP/BUSINESS CREDIT, INC., BAY HARBOUR MANAGEMENT L.C., AND UNITED
STATES TRUST COMPANY OF NEW YORK WHICH MATERIALLY AFFECTS CERTAIN
PAYMENT RIGHTS, SUBORDINATES CERTAIN SECURITY INTERESTS AND LIMITS
RIGHTS TO ENFORCEMENT. ALL PERSONS OR OTHER ENTITIES WHICH AT ANY TIME
HOLD INDEBTEDNESS HEREUNDER ARE BOUND BY THE TERMS OF THE INTECREDITOR
AGREEMENT WHICH WILL BE MADE AVAILABLE UPON REQUEST.
SECTION 3.17 JUNIOR SUBORDINATED LENDERS: POWER OF ATTORNEY; AGREEMENT
TO COOPERATE. The Junior Subordinated Lenders irrevocably authorize and empower
the Senior Agent and the CR Senior Lender (or any and all representatives
thereof) to demand, xxx for, collect and receive every such payment or
distribution to which such Junior Subordinated Lenders are entitled and give
acquittance therefor, and to file claims and proofs of claim in any statutory or
non-statutory proceeding, to vote such claim in any such proceeding, and to take
any and all such other actions, in its own name as the CR Senior Lender, or in
the name of such Junior Subordinated Lenders or otherwise, as the Senior Agent
and the CR Senior Lender (or their respective representatives) may deem
necessary or advisable in its sole discretion for the enforcement of the
provisions of this Agreement and for the satisfaction and payment in full of the
CR Senior Obligations. The Junior Subordinated Lenders hereby agree, duly and
promptly to take such action as may be requested at any time and from time to
time by the Senior Agent and the CR Senior Lender (or their respective
representatives), to file appropriate proofs of claim in respect of the Junior
Subordinated Obligations, and to execute and deliver such powers of attorney,
assignments of proofs of claim or other instruments as may be requested by the
Senior Agent and the CR Senior Lender (or their respective representatives), in
order to enable the CR Senior Lender to enforce any and all claims upon or in
respect of the Junior Subordinated Obligations and to collect and receive any
and all payments or distributions which may be payable or deliverable at any
time upon or in respect of the Junior Subordinated Obligations.
SECTION 3.18 BH SENIOR LENDERS: POWER OF ATTORNEY; AGREEMENT TO
COOPERATE. In the event the BH Senior Lender has taken Remedial Action with
respect to the BH First Priority Collateral [exclusive of any related equity
interest] and has received all or substantially all of the BH Collateral
Proceeds such BH Senior Lender is reasonably likely to receive therefrom at a
time when the CR Senior Obligations shall not have been paid in full and the CR
Senior Lender has commenced Remedial Action with respect to the CR First
Priority Collateral, the BH Senior Lender irrevocably authorizes and empowers
Senior Agent and the CR Senior Lender (or their respective representatives) to
demand, xxx for, collect and receive every such payment or distribution to which
the BH Senior Lender is entitled from the proceeds of the CR First Priority
Collateral (the "CR COLLATERAL PROCEEDS") and give acquittance therefor, and to
file claims and proofs of claim in any statutory or non-statutory proceeding, to
vote such claim in any such proceeding, and to take such other actions, in its
own name as the CR Senior Lender, or in the name of the BH Senior Lender or
otherwise, as the Senior Agent and CR Senior Lender (or their respective
representatives) may deem necessary or advisable for the enforcement of the
provisions of this Agreement. The BH Senior Lender hereby agrees, duly and
promptly to take such action as may be requested at any time and from time to
time by the Senior Agent and CR Senior Lender (or their respective
representatives), to file appropriate proofs of claim in respect of the BH
Senior Obligations, and to execute and deliver such powers of attorney,
assignments of proofs of claim or other instruments as may be requested by the
Senior Agent and CR Senior Lender (or their respective representatives), in
order to enable the CR Senior Lender to enforce any and all claims upon or in
respect of the CR Senior Obligations and to collect and receive any and all
payments or distributions which may be payable or deliverable at any time upon
or in respect of the CR Senior Obligations from the CR Collateral Proceeds.
ARTICLE IV
MISCELLANEOUS
SECTION 4.1 CONFLICT. In the event of any conflict between the terms
of any Credit Document and the terms of this Agreement, the terms of this
Agreement shall control.
SECTION 4.2 NO THIRD PARTY BENEFIT, ETC. This Agreement is entered
into for the benefit of the parties hereto and their respective successors and
assigns only and no benefit shall accrue or is intended with respect to any
third party, including, without limitation, any trustee in bankruptcy for PHI or
any other Obligor.
SECTION 4.3 AMENDMENTS AND WAIVERS. All modifications, amendments or
waivers of any of the terms or provisions of this Agreement shall be in writing
and duly executed by a duly authorized officer of each of the parties to this
Agreement.
SECTION 4.4 SUCCESSORS AND ASSIGNS. All the covenants, terms and
agreements in this Agreement shall bind and inure to the benefit of the
respective successors and assigns of PHI, the other Obligors, the Noteholders
and the Intercreditor Parties.
SECTION 4.5 PARTIAL INVALIDITY. The unenforceability or invalidity of
any provision or provisions of this Agreement shall not render any other
provision or provisions herein contained unenforceable or invalid.
SECTION 4.6 COMMUNICATIONS. All communications between or among the
Intercreditor Parties provided for herein shall be in writing and via overnight
delivery or telecopier, and shall be deemed to have been given:
(a) when delivered, if delivered personally or by overnight delivery
service;
(b) when delivered, if delivered by the United States mail, postage
prepaid, with return receipt requested; or
(c) if delivered by telecopier transmissions, upon receipt of
confirmation of transmission thereof by the sender thereof, addressed, in each
case, at the address of each party set forth below or such other address as such
party may designate by notice duly given in accordance with this Section to the
other parties hereto:
IF TO THE SENIOR AGENT:
----------------------
CIT Group/Business Group, Inc., as Senior Agent
0000 Xxxxxx xx xxx Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Telecopier No.: (000) 000-0000
Attention: Xxxxxxxx Xxxxxxx
with a copy to:
Rothschild Recovery Fund, L.P.
1251 Avenue of the Xxxxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxxx Xxxx
IF TO THE BH SENIOR LENDER:
Bay Harbour Management L.C.
---------------------------
Attention:
IF TO THE JUNIOR SUBORDINATED TRUSTEE
OR THE JUNIOR SUBORDINATED PRINCIPAL LENDERS:
United States Trust Company of New York
Corporate Trust & Agency Division
000 Xxxx 00xx Xxxxxx, 00xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Corporate Trust Administration
Facsimile: (000) 000-0000
SECTION 4.7 GOVERNING LAW; CONSENT TO JURISDICTION. THIS AGREEMENT
SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE INTERNAL LAWS OF THE
STATE OF NEW YORK (WITHOUT REGARD TO ANY CONFLICTS-OF-LAW PRINCIPLES).
SECTION 4.8 FORUM SELECTION AND CONSENT TO JURISDICTION. ANY
LITIGATION BASED ON, OR ARISING OUT OF, UNDER, OR IN CONNECTION WITH, THIS
AGREEMENT, OR ANY COURSE OF CONDUCT, COURSE OF DEALING, STATEMENTS (WHETHER ORAL
OR WRITTEN) OR ACTIONS OF ANY PARTY TO THIS AGREEMENT, SHALL BE BROUGHT AND
MAINTAINED EXCLUSIVELY IN THE FEDERAL OR STATE COURTS OF NEW YORK LOCATED IN THE
BOROUGH OF MANHATTAN; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING ENFORCEMENT
AGAINST ANY INTERCREDITOR COLLATERAL MAY BE BROUGHT IN THE COURTS OF ANY
JURISDICTION WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND. EACH PARTY
HEREBY EXPRESSLY AND IRREVOCABLY SUBMITS TO THE JURISDICTION OF SUCH COURTS FOR
THE PURPOSE OF ANY SUCH LITIGATION AS SET FORTH ABOVE AND IRREVOCABLY AGREES TO
BE BOUND BY ANY JUDGMENT RENDERED THEREBY IN CONNECTION WITH SUCH LITIGATION.
EACH PARTY HERETO FURTHER IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS BY
REGISTERED MAIL, POSTAGE PREPAID, OR BY PERSONAL SERVICE WITHIN OR WITHOUT THE
STATE OF NEW YORK. EACH PARTY HERETO HEREBY EXPRESSLY AND IRREVOCABLY WAIVES, TO
THE FULLEST EXTENT PERMITTED BY LAW, ANY OBJECTION WHICH IT MAY HAVE OR
HEREAFTER MAY HAVE TO THE LAYING OF VENUE OF ANY SUCH LITIGATION BROUGHT IN ANY
SUCH COURT REFERRED TO ABOVE AND ANY CLAIM THAT ANY SUCH LITIGATION HAS BEEN
BROUGHT IN AN INCONVENIENT FORUM. TO THE EXTENT THAT ANY PARTY HERETO HAS OR
HEREAFTER MAY ACQUIRE ANY IMMUNITY FROM JURISDICTION OF ANY COURT OF FROM ANY
LEGAL PROCESS (WHETHER THROUGH SERVICE OR NOTICE, ATTACHMENT PRIOR TO JUDGMENT,
ATTACHMENT IN AID OF EXECUTION OR OTHERWISE) WITH RESPECT TO ITSELF OR ITS
PROPERTY, SUCH PARTY HEREBY IRREVOCABLY WAIVES SUCH IMMUNITY IN RESPECT OF ITS
OBLIGATIONS UNDER THIS AGREEMENT.
SECTION 4.9 WAIVER OF JURY TRIAL, ETC. EACH PARTY TO THIS AGREEMENT
HEREBY KNOWINGLY, VOLUNTARILY AND INTENTIONALLY WAIVES ANY RIGHTS IT MAY HAVE TO
A TRIAL BY JURY IN RESPECT OF ANY LITIGATION BASED HEREON, OR ARISING OUT OF,
UNDER, OR IN CONNECTION WITH, THIS AGREEMENT OR ANY COURSE OF CONDUCT, COURSE OF
DEALING, STATEMENTS (WHETHER ORAL OR WRITTEN) OR ACTIONS OF ANY PARTY HERETO.
EACH PARTY HERETO ACKNOWLEDGES AND AGREES THAT IT HAS RECEIVED FULL AND
SUFFICIENT CONSIDERATION FOR THIS PROVISION AND THAT THIS PROVISION IS A
MATERIAL INDUCEMENT FOR EACH OF THE PARTIES HERETO ENTERING INTO THIS AGREEMENT.
SECTION 4.10 COUNTERPARTS. This Agreement may be executed and
delivered in any number of counterparts, each of such counterparts constituting
an original but altogether only one Agreement.
SECTION 4.11 FURTHER ASSURANCES. Each Intercreditor Party agrees to
execute such further documents and agreements as may be reasonably requested by
the other to give effect to the purposes of this Agreement.
SECTION 4.12 SPECIFIC ENFORCEMENT. EACH PARTY TO THIS AGREEMENT
ACKNOWLEDGES AND AGREES THAT THE TERMS OF THIS AGREEMENT ARE A MATERIAL
INDUCEMENT TO ITS ENTERING INTO ITS RESPECTIVE CREDIT DOCUMENTS. ACCORDINGLY,
EACH INTERCREDITOR PARTY IS HEREBY AUTHORIZED TO DEMAND SPECIFIC PERFORMANCE OF
THE PROVISIONS OF THIS AGREEMENT AT ANY TIME WHEN ANY OTHER INTERCREDITOR PARTY
SHALL HAVE FAILED TO COMPLY WITH ANY OF THE PROVISIONS THAT ARE APPLICABLE TO
IT. EACH INTERCREDITOR PARTY HEREBY IRREVOCABLY WAIVES ANY DEFENSE BASED ON THE
ADEQUACY OF A REMEDY AT LAW THAT MIGHT BE ASSERTED AS A BAR TO SUCH REMEDY OF
SPECIFIC PERFORMANCE.
SECTION 4.13 ACKNOWLEDGEMENT BY PHI. By executing the acknowledgement
to this Agreement, PHI agrees, for and on behalf of itself and the other
Obligors, to all the terms hereof and shall not, either directly or indirectly,
take any action to challenge or otherwise impair in any respect the operation of
this Agreement.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the day and year first above written.
THE CIT GROUP/BUSINESS CREDIT, INC.,
as Senior Agent
By:
----------------------------
Name:
Title:
BAY HARBOUR MANAGEMENT L.C.
By:
----------------------------
Name:
Title:
UNITED STATES TRUST COMPANY OF NEW YORK
By:
----------------------------
Name:
Title:
[OTHER BONDHOLDERS]
ACKNOWLEDGED AND AGREED:
PLANET HOLLYWOOD INTERNATIONAL, INC.
By:
----------------------------
Name:
Title:
[SPV AND SUBSIDIARY BORROWERS]
By:
----------------------------
Name:
Title:
SCHEDULE 1
LIST OF BORROWERS
SCHEDULE 2
CR FIRST PRIORITY COLLATERAL
SCHEDULE 3
BH FIRST PRIORITY COLLATERAL
Annex I
CR SENIOR SECURITY AGREEMENTS
Annex II
BH SENIOR SECURITY AGREEMENTS
Annex III
JUNIOR SUBORDINATED SECURITY AGREEMENTS
===============================================================================
INTERCREDITOR AND SUBORDINATION AGREEMENT
dated as of February __, 2000
among
THE CIT GROUP/BUSINESS CREDIT, INC.,
THE SENIOR AGENT ON BEHALF OF THE CR SENIOR LENDERS,
BAY HARBOUR MANAGEMENT L.C.,
THE BH SENIOR LENDER,
UNITED STATES TRUST COMPANY OF NEW YORK,
THE JUNIOR SUBORDINATED TRUSTEE
ON BEHALF OF THE NOTEHOLDERS
and
[LIST INSTITUTIONAL PIK NOTEHOLDERS]
===============================================================================
TABLE OF CONTENTS
PAGE
-----
ARTICLE I DEFINITIONS.....................................................2
Section 1.1 Certain Definitions.......................................2
Section 1.1 A BH/PIK Lenders Lien Subordination.........................6
Section 1.1 B Junior Subordinated Lenders Debt Subordination............7
Section 1.2 No Payment Upon Insolvency Event..........................7
Section 1.3 No Payment When CR Senior Obligations in Default..........8
Section 1.4 Remedies Standstill.......................................8
Section 1.5 Waiver of Certain Rights..................................9
Section 1.6 No Authority to Act During Insolvency Proceedings.........9
Section 1.7 [Intentionally Left Blank]................................9
Section 1.8 Provisions Solely To Define Relative Rights...............9
Section 1.9 No Waiver of Subordination Provisions.....................9
Section 1.10 Amendments, etc..........................................10
Section 1.11 Specific Enforcement.....................................10
ARTICLE II COLLATERAL ISSUES, ETC........................................10
Section 2.1 Representations and Warranties as to this Agreement......10
Section 2.2 CR First Priority Collateral Rights......................10
Section 2.3 BH First Priority Collateral Rights......................11
Section 2.4 Guaranty and Subordination Action........................11
Section 2.5 [Intentionally Left Blank]...............................12
Section 2.6 Exclusive Enforcement Rights.............................12
ARTICLE III OTHER AGREEMENTS.............................................13
Section 3.1 Releases................................................13
Section 3.2 Insurance and Condemnation Awards.......................14
Section 3.3 No Additional Obligations...............................14
Section 3.4 Waivers.................................................15
Section 3.5 Information Concerning PHI, etc.........................16
Section 3.6 Application of Payments.................................16
Section 3.7 Independent Decisions...................................16
Section 3.8 Turnover of Prohibited Transfers........................17
Section 3.9 Effectiveness During Insolvency Proceeding..............17
Section 3.10 Amendments..............................................17
Section 3.11 Limitation on Declaring Defaults........................17
Section 3.12 Duration and Termination; Payment Invalidated...........17
Section 3.13 Notice of BH/PIK Lenders Interests......................18
Section 3.14 Credit Documents........................................19
Section 3.15 Bailee for Perfection...................................19
Section 3.16 Legend..................................................19
Section 3.17 Junior Subordinated Lenders: Power of Attorney;
Agreement to Cooperate..................................19
Section 3.18 BH Senior Lenders: Power of Attorney; Agreement
to Cooperate............................................20
ARTICLE IV MISCELLANEOUS.................................................20
Section 4.1 Conflict................................................20
Section 4.2 No Third Party Benefit, etc.............................20
Section 4.3 Amendments and Waivers..................................21
Section 4.4 Successors and Assigns..................................21
Section 4.5 Partial Invalidity......................................21
Section 4.6 Communications..........................................21
Section 4.7 Governing Law; Consent to Jurisdiction..................22
Section 4.8 Forum Selection and Consent to Jurisdiction.............22
Section 4.9 Waiver of Jury Trial, etc...............................23
Section 4.10 Counterparts............................................23
Section 4.11 Further Assurances......................................23
Section 4.12 Specific Enforcement....................................23
Section 4.13 Acknowledgement by PHI..................................23
SCHEDULES
Schedule 1 - List of Borrowers
Schedule 2 - CR First Priority Collateral
Schedule 3 - BH First Priority Collateral
Annex I - CR Senior Security Agreements
Annex II - BH Senior Security Agreements
Annex III - Junior Subordinated Security Agreements
ANNEX __
SUBORDINATION PROVISIONS TO THE SENIOR
SUBORDINATED CREDIT AGREEMENT
SECTION 1.01 SUBORDINATION TO SENIOR DEBT. Planet Hollywood
International, Inc. ("PHI"), certain subsidiaries of PHI (PHI and such
subsidiaries, together with their respective successors and assigns, being
collectively, the "COMPANY"), and Bay Harbour Management L.C., (together with
its successors and assigns, the "SENIOR SUBORDINATED LENDER"), each a party to
the Senior Subordinated Credit Agreement, dated as of February __, 2000 (as
amended, restated, supplemented or otherwise modified from time to time, the
"SENIOR SUBORDINATED CREDIT AGREEMENT"), covenant and agree that, to the extent
and in the manner hereinafter set forth, the payment of the principal of,
premium, if any, interest on and all other amounts owing on or in respect of
(including, without limitation, claims for rescission, damages, indemnification
and costs and expenses) the Senior Subordinated Credit Agreement and the other
Senior Subordinated Credit Documents (such capitalized term and all other
capitalized terms used herein without being defined shall have the meanings
provided for in the Intercreditor Agreement referenced in SECTION 1.12)
(collectively, the "SENIOR SUBORDINATED OBLIGATIONS") is hereby expressly made
subordinate and subject in right of payment to the prior payment in full in cash
of all the Senior Obligations in the manner set forth in this ANNEX I. Each
Senior Lender shall be deemed to have acquired the Senior Obligations in
reliance upon the covenants and provisions contained herein.
SECTION 1.02 NO PAYMENT UPON INSOLVENCY EVENT. During any Insolvency
Proceeding:
(a) the Senior Lenders shall receive payment in full in cash of all
amounts due on or to become due on or in respect of all Senior Obligations
(including any interest accruing thereon at the rate provided in the Senior
Credit Agreement after the commencement of any such Insolvency Proceeding,
whether or not allowed as a claim against the Company in such Insolvency
Proceeding) before the Senior Subordinated Lender receives or accepts any
payment or distribution, whether by setoff, exercising contractual or statutory
rights or otherwise and whether in the form of cash, stock, property or
otherwise, on account of the Senior Subordinated Obligations;
(b) any payment or distribution of assets of the Company of any kind
or character, whether in the form of cash, property, securities or otherwise, by
set-off, exercising contractual or statutory rights or otherwise, to which the
Senior Subordinated Lender would be entitled but for the provisions of this
SECTION 1.02, shall be paid by the Company or the liquidating trustee or agent
or other person making such payment or distribution, whether a trustee in
bankruptcy, a receiver or liquidating trustee or otherwise, directly to the
Senior Agent on behalf of the Senior Lenders; and
(c) to the extent any payment of Senior Obligations (whether by or on
behalf of the Company, as proceeds of security or enforcement of any right of
setoff or otherwise) is declared to be fraudulent or preferential, set aside or
required to be paid to any receiver, trustee in bankruptcy, liquidating trustee,
agent or other similar person under any Insolvency Proceeding or in connection
with any fraudulent conveyance or similar law, then if such payment is recovered
by, or paid over to, such receiver, trustee in bankruptcy, liquidating trustee,
agent or other similar person, the Senior Obligations or part thereof originally
intended to be satisfied shall be deemed to be reinstated and outstanding as if
such payment had not occurred.
In the event that, notwithstanding the foregoing provisions of this
Section the Senior Subordinated Lender shall receive any payment or distribution
of assets of the Company of any kind or character, whether in the form of cash,
property, securities or otherwise, before all the Senior Obligations have been
paid in full in cash and all commitments of the Senior Lenders to make
extensions of credit available to the Company have irrevocably terminated, then
such payment or distribution shall be held in trust for the benefit of, and be
immediately paid over to, the Senior Agent on behalf of the Senior Lenders.
SECTION 1.03 NO PAYMENT WHEN SENIOR OBLIGATIONS IN DEFAULT. In the
event that any default or event of default (collectively, a "SENIOR DEFAULT")
has occurred under the Senior Credit Agreement, the Senior Subordinated Lender
shall not receive or accept any payment or distribution, whether by setoff,
exercising contractual or statutory rights or otherwise and whether in the form
of cash, stock, property or otherwise, on account of the Senior Subordinated
Obligations until the earlier to occur of (a) such Senior Default having been
waived in writing by the Senior Lenders or (b)(i) the Senior Obligations
(including, without limitation, amounts that have become and remain due by
acceleration, together with any interest accruing thereon at the rate provided
in the Senior Credit Agreement) having been paid in full in cash and (ii) all
the commitments by the Senior Lenders to make credit extensions available to the
Company having been irrevocably terminated. In the event that, notwithstanding
the foregoing, the Company shall have made, or the Senior Subordinated Lender
shall have received, any payment or distribution of assets of PHI or any of its
subsidiaries of any kind or character, whether in the form of cash, property,
securities or otherwise, at any time when prohibited by the foregoing provisions
of this Section, then in such event such payment shall be held in trust for the
benefit of, and be immediately paid over to, the Senior Agent on behalf of the
Senior Lenders.
SECTION 1.04 REMEDIES STANDSTILL. During any period of time in which
the Senior Subordinated Lenders are prohibited from obtaining or receiving any
payment on the Subordinated Obligations as provide in SECTIONS 1.02 and 1.03,
the Senior Subordinated Lender shall not take, demand, xxx for, accelerate or
commence any remedial proceeding with respect to any amount that is payable on
account of the Subordinated Obligations until (a) all of the Senior Obligations
have been paid in full in cash and (b) all the commitments by the Senior Lenders
to make credit extensions available to the Company have irrevocably terminated.
SECTION 1.05 WAIVER OF CERTAIN RIGHTS. The Senior Subordinated Lender
(a) hereby waives any and all rights that it otherwise might have to require the
Senior Lenders (i) to marshal any property or assets of the Company or (ii)
enforce any guaranty or any security interest or lien given by any guarantor or
other person to secure the payment of any or all of the Senior Obligations, in
each case as a condition precedent to enforcing their rights hereunder, (b)
shall not oppose, interfere or otherwise attempt to prevent or impair the Senior
Lenders from enforcing the security interests on any collateral securing the
repayment of the Senior Obligations and (c) shall not take, or permit to be
taken on its behalf, any action that is inconsistent with the terms of this
ANNEX I.
SECTION 1.06 NO AUTHORITY TO ACT DURING INSOLVENCY PROCEEDINGS. During
the pendency of any Insolvency Proceeding, the Senior Subordinated Lender agrees
not to take any action which it is not permitted to take under this ANNEX I.
SECTION 1.07 SUBROGATION TO RIGHTS OF SENIOR LENDERS. Subject to (a)
the payment in full in cash of the Senior Obligations and (b) the irrevocable
termination of all commitments of the Senior Lenders to make further credit
extensions of credit available to the Company, the Senior Subordinated Lender
shall be subrogated to the rights of the Senior Lenders to receive payments and
distributions of cash, property and securities applicable to the Senior
Obligations until the principal of, premium, if any, and interest on the Senior
Obligations shall be paid in full. For purposes of such subrogation, no payments
or distributions to the Senior Lenders of any cash, property or securities to
which the Senior Subordinated Lender would be entitled except for the provisions
of this ANNEX I, and no payments pursuant to the provisions of this ANNEX I to
the Senior Lenders by the Senior Subordinated Lender, shall, as among the
Company, its creditors other than Senior Lenders and the Senior Subordinated
Lender, be deemed to be a payment or distribution by the Company to or on
account of the Senior Obligations.
SECTION 1.08 PROVISIONS SOLELY TO DEFINE RELATIVE RIGHTS. The
provisions of this ANNEX I are and are intended solely for the purpose of
defining the relative rights of the Senior Subordinated Lender, on the one hand,
and the Senior Lenders, on the other hand. Nothing contained in this ANNEX I or
elsewhere or in the Senior Subordinated Credit Agreement shall impair, as among
the Company, its creditors other than the Senior Lenders and the Senior
Subordinated Lender, the obligation of the Company, which is absolute and
unconditional, to pay the principal of, premium, if any, and, interest on the
Senior Obligations and the Senior Subordinated Obligations, in each case in
accordance with its terms.
SECTION 1.09 NO WAIVER OF SUBORDINATION PROVISIONS. No right of any
present or future Senior Lender to enforce the subordination provisions provided
herein shall at any time be prejudiced or impaired in any manner by any act or
failure to act on the part of the Company or the Senior Subordinated Lender, by
any act or failure to act by the Senior Lenders or by any noncompliance by the
Company or the Senior Subordinated Lender with the terms, provisions and
covenants of this ANNEX I, regardless of any knowledge thereof any Senior Lender
may have or be otherwise charged with.
SECTION 1.10 AMENDMENTS, ETC. No provision of this ANNEX I may be
amended, supplemented or otherwise modified in any respect without the consent
of all the Senior Lenders.
SECTION 1.11 THIRD PARTY BENEFICIARIES; SPECIFIC ENFORCEMENT.
(a) The provisions of this ANNEX I are intended for the benefit of,
and shall be enforceable directly by, each Senior Lender. The Senior
Subordinated Lender acknowledges and agrees that the terms of this ANNEX I are a
material inducement to the Senior Lenders to make the Senior Obligations
available to the Company, that the Senior Lenders would not have made the Senior
Obligations available to the Company without the benefit of the provisions
contained in this ANNEX I, and that the Senior Subordinated Lender is receiving
substantial benefits as a result of the Senior Lenders making the Senior
Obligations available to the Company. Accordingly, the Senior Subordinated
Lender agrees that the Senior Agent and the Senior Lenders are third party
beneficiaries of this ANNEX I and may enforce all of its terms directly against
the Senior Subordinated Lender.
(b) Each Senior Lender is hereby authorized to demand specific
performance of the provisions of this ANNEX I, whether or not the Company shall
have complied with any of the provisions hereof applicable to it, at any time
when the Senior Subordinated Lender shall have failed to comply with any of such
provisions applicable to it. The Senior Subordinated Lender hereby irrevocably
waives any defense based on the adequacy of a remedy at law that might be
asserted as a bar to such remedy of specific performance, it being agreed that
the Senior Lenders will suffer irreparable harm if the terms of this ANNEX I are
not strictly enforced in accordance with its terms.
SECTION 1.12 DEFINITIONS. For purposes of this Annex capitalized terms
not defined herein have the meanings ascribed thereto in the Intercreditor
Agreement, dated February __, 2000 among the Senior Agent, the Senior Lenders,
the Senior Subordinated Lender, the Junior Subordinated Trustee and the Junior
Subordinated Lenders, as amended, restated or otherwise modified from time to
time (the "INTERCREDITOR AGREEMENT").
The provisions of this Annex should be construed to supplement the
provisions of the Intercreditor Agreement and should not be interpreted to
restrict or modify the provisions of the Intercreditor Agreement in any manner.
IN WITNESS WHEREOF, the parties have executed this Annex as of the day
and year first above written:
PLANET HOLLYWOOD INTERNATIONAL, INC.
By:
---------------------------------
Name:
Title:
BAY HARBOUR MANAGEMENT L.C.
By:
---------------------------------
Name:
Title:
