Klöckner Pentaplast
Priming AmendmentsSenior Facilities Agreement
Priming Amendments / Pro Rata Sharing / Waterfall Protection
SFA
Without the consent of each Lender, no amendment or waiver shall have "the effect of changing or which relates to":
"the order of priority in the Intercreditor Agreement in a manner adverse to the interests of the Lenders (in their capacity as such), provided that, for the avoidance of doubt, any Permitted Structural Adjustment or the introduction of an Additional Facility or any other **Permitted I
"Clause 34 (Sharing among the Finance Parties) to the extent such change would adversely affect the interests of the Lenders (in their capacity as such), provided that, for the avoidance of doubt, any Permitted Structural Adjustment or the introduction of an Additional Facility or any ot
"in each case [of the above] other than as required to implement or reflect":
"any Permitted Structural Adjustment"
"any Additional Facility pursuant to Clause 2.2 (Additional Facilities)" or
"any other Permitted Indebtedness"
Overview
Consent of each Lender required for amendments to the ICA waterfall order of priority and the pro rata sharing provision (Clause 34)
Such sacred rights expressly apply to other amendments that (x) relate to such provisions or (y) have the effect of changing such provisions
Such sacred rights expressly exclude Permitted Structural Adjustments, Additional Facilities, and Permitted Indebtedness — such transactions are per se deemed not adverse to the interests of the Lenders
Broad ability with Majority Lender consent to incur Additional Facility debt or other Permitted Indebtedness on a priming or super-senior basis without triggering all-lender sacred rights; corresponding ICA waterfall and Clause 34 amendments are expressly carved out
Notably, the manner in which enforcement proceeds are distributed requires only Super Majority (not all-lender) consent to amend — a significant vulnerability relative to more creditor-protective intercreditor structures
Consent of only the Super Majority Lenders is required for amendments to the "nature or scope" of the Charged Property and release of Transaction Security
“Structural Adjustments”
The Senior Facilities Agreement allows "Permitted Structural Adjustments" with only the consent of the participating Lenders and the Obligors' Agent (no consent of any other Lender required), to make certain changes, including:
re-designation or transfer of all or any part of a Commitment and/or participation in any Utilisation to a new tranche or facility established as an Additional Facility or pursuant to a Structural Adjustment — requires only the individual consenting Lender and the Obligors' Agent, no other person's
introduction of a new Additional Facility tranche — relevant Additional Facility Lenders only, with no requirement to offer participation rateably to existing Lenders; and
with the consent of the Majority Lenders (in addition to participating Lenders): any Structural Adjustment that increases the Commitments or reduces the tenor of any Facility; any amendment required to implement or reflect a Permitted Structural Adjustment or Additional Facility is **bin
The Structural Adjustments / Additional Facility framework could move favored lenders into a separate tranche without the consent of non-participating lenders
Such features could be used to execute a non-pro-rata uptier: (i) coordinated lenders satisfying the dual Majority Lenders threshold (>50% EUR pool and >50% USD pool) agree to a Structural Adjustment or Additional Facility creating a new super-senior tranche; (ii) their existing participations are r