Subordination Clause Example from Business Contracts

Subordination. Any indebtedness of Borrower to Guarantor, now or hereafter existing, including but not limited to any indebtedness to Guarantor as subrogee of Lender or resulting from Guarantor's performance under this Guaranty, are hereby subordinated to the Indebtedness. In addition to Guarantor's waiver of any right of subrogation as set forth in this Guaranty with respect to any indebtedness of Borrower to Guarantor as subrogee of Lender, Guarantor agrees that, if Lender so requests at any time when an Eve...nt of Default has occurred and is continuing, Guarantor shall not demand, take, or receive from Borrower, by setoff or in any other manner, payment of any other indebtedness of Borrower to Guarantor until the Indebtedness has been paid in full and any commitments of Lender or facilities provided by Lender with respect to the Indebtedness have been terminated. If any payments are received by Guarantor in violation of such waiver or agreement, such payments shall be received by Guarantor as trustee for Lender and shall be paid over to Lender on account of the Indebtedness, but without reducing or affecting in any manner the liability of Guarantor under the other provisions of this Guaranty. Any security interest, lien, or other encumbrance that Guarantor may now or hereafter have on any property of Borrower is hereby subordinated to any security interest, lien, or other encumbrance that Lender may have on any such property. View More