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The Intercreditor and Subordination Agreement is essential in complex financing transactions where multiple creditors hold different ranks of debt against the same borrower(s). This document, governed by German law, is typically used in leveraged finance transactions, project financings, and restructurings where there are multiple layers of debt (such as senior debt, mezzanine finance, and shareholder loans). It establishes the hierarchy of payments, enforcement rights, and subordination arrangements between creditors, ensuring clarity in both regular payment scenarios and enforcement situations. The agreement must comply with German civil law principles, particularly regarding security interests (Sicherungsrechte) and insolvency regulations (Insolvenzordnung). It includes specific provisions for payment blockage, turnover of receipts, and enforcement standstills, tailored to the German legal framework.

1. Parties: Identification of all creditor groups, borrower(s), and any security trustees

2. Background: Context of the financing arrangement and purpose of the intercreditor agreement

3. Definitions and Interpretation: Definitions of key terms, including different debt categories, creditor classes, and interpretation rules

4. Ranking and Priority: Establishes the ranking of different classes of debt and security interests

5. Payment Subordination: Rules governing the order of payments and payment restrictions

6. Turnover Provisions: Obligations to turn over unauthorized payments received in breach of subordination

7. Payment Blockage: Circumstances and procedures for blocking payments to subordinated creditors

8. Enforcement: Rights and limitations regarding enforcement actions by different creditor classes

9. Application of Proceeds: Waterfall provisions for the application of enforcement proceeds and payments

10. Security and Guarantees: Provisions regarding shared security and guarantee arrangements

11. Bankruptcy and Insolvency: Rights and obligations in case of insolvency proceedings

12. Representations and Warranties: Standard representations by the parties

13. Accession, Transfer and Assignment: Rules for new creditors joining and existing creditors transferring rights

14. Notices and Communications: Communication procedures between parties

15. Governing Law and Jurisdiction: Choice of German law and jurisdiction provisions