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Intercreditor Agreement Revolving Credit Cap Clauses

Description: In an ABL facility, the outstanding principal amount of loans may inadvertently exceed the maximum permitted amount of first lien debt and might result in loans which were deemed appropriate at the time of extension being denied first lien priority under the intercreditor agreement. First lien lenders will not want to be penalized if the amount of the loans would be in excess of the maximum permitted amount due to a circumstance out of their control. These sample clauses protect the first lien lenders under such circumstances.
Form Type: Clauses
Practice Area: Corporate & Securities

Date: May 2014
PLI Item #: 133535
Keywords: "intercreditor agreement"; "lien subordination"; "first lien obligations"; "second lien obligations"; "first lien claimholders"; "second lien claimholders"; "revolving credit"; "debt cap"; "refinancing"; "amendment"; "restatement"; "maximum first priority lien amount"
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