Workout Loans. During (and, in the case of Contributions and Interest Proceeds after) the Reinvestment Period the Issuer may use Contributions, Interest Proceeds or Principal Proceeds on deposit in the Collection Account to acquire a Workout Loan; provided, that (1) Interest Proceeds may only be used to acquire a Workout Loan if the Collateral Manager believes that such acquisition will not render insufficient the available Interest Proceeds remaining on the next Payment Date to pay in full all amounts due and payable through and including Section 11.1(a)(i)(E), (2) if Principal Proceeds are used to acquire a Workout Loan, (w) such Workout Loan must rank senior to or pari passu with the Collateral Obligation subject to the applicable workout or restructuring, (x) after giving effect to such acquisition (i) Principal Proceeds (other than Principal Proceeds applied to the acquisition of Uptier Priming Debt) used to acquire Workout Loans and Equity Securities that are held by the Issuer on such date of determination may not exceed 5.0% of the Collateral Principal Amount and (ii) Principal Proceeds (other than Principal Proceeds applied to the acquisition of Uptier Priming Debt) used to acquire Workout Loans and Equity Securities at any time since the Closing Date shall not exceed 7.5% of the Target Initial Par Amount and (y) each Overcollateralization Ratio Test must be satisfied after giving effect to such acquisition; (3) if such Workout Loan is a Second Lien Loan, the Workout Payment Condition is satisfied with respect to such Workout Loan, (4) in the case of any Non-Qualified Workout Loan and after giving effect to such acquisition, the Collateral Principal Amount plus the S&P Collateral Value of any Defaulted Obligations will be greater than or equal to the Reinvestment Target Par Balance and (5) in the Collateral Manager’s judgment exercised in accordance with the Collateral Management Agreement, the acquisition of such Workout Loan is advisable to increase the recovery value with respect to the related Collateral Obligation or the failure to acquire such Workout Loan is reasonably likely to result in a reduced overall recovery with respect to the related Collateral Obligation. Any such acquisition of a Workout Loan shall not be subject to the Investment Criteria. For the avoidance of doubt, Contributions may be used to acquire Workout Loans without any restrictions under this paragraph so long as in the Collateral Manager’s judgment exercised in accordance with the Collateral Management Agreement, the acquisition of such Workout Loan is advisable to increase the recovery value with respect to the related Collateral Obligation, or the failure to acquire such Workout Loan is reasonably likely to result in a reduced overall recovery with respect to the related Collateral Obligation. Notwithstanding anything in this Indenture or the Collateral Management Agreement to the contrary, the Collateral Manager may enter into commitments to acquire Collateral Obligations on the basis of Principal Proceeds which have not yet been received, but (x) which will be received by the Issuer from the sale of Collateral Obligations for which the trade date has already occurred but the settlement date has not yet occurred or (y) with respect to which the Collateral Manager reasonably expects to receive such Principal Proceeds or has received written notice from the Obligor, administrative agent or other similar Person in writing that such Principal Proceeds are scheduled to be paid (including, without limitation, by the dissemination or posting to an internet site of a report stating or indicating that such payment is scheduled to be paid).
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Workout Loans. During (and, in the case of Contributions and Interest Proceeds after) the Reinvestment Period the Issuer may use Contributions, Interest Proceeds or Principal Proceeds on deposit in the Collection Account to acquire a Workout Loan; provided, that (1) Interest Proceeds may only be used to acquire a Workout Loan if the Collateral Manager believes that such acquisition will not render insufficient the available Interest Proceeds remaining on the next Payment Date to pay in full all amounts due and payable through and including Section 11.1(a)(i)(E), (2) if Principal Proceeds are used to acquire a Workout Loan, (w) such Workout Loan must rank senior to or pari passu with the Collateral Obligation subject to the applicable workout or restructuring, (x) after giving effect to such acquisition (i) Principal Proceeds (other than Principal Proceeds applied to the acquisition of Uptier Priming Debt) used to acquire Workout Loans and Equity Securities that are held by the Issuer on such date of determination may not exceed 5.07.5% of the Collateral Principal Amount and (ii) Principal Proceeds (other than Principal Proceeds applied to the acquisition of Uptier Priming Debt) used to acquire Workout Loans and Equity Securities at any time since the Closing Date shall not exceed 7.510.0% of the Target Initial Par Amount and (y) each Overcollateralization Ratio Test must be satisfied after giving effect to such acquisition; (3) if such Workout Loan is a Second Lien Loan, the Workout Payment Condition is satisfied with respect to such Workout Loan, (4) in the case of any Non-Qualified Workout Loan and after giving effect to such acquisition, the Collateral Principal Amount plus the S&P Collateral Value of any Defaulted Obligations will be greater than or equal to the Reinvestment Target Par Balance and (5) in the Collateral Manager’s judgment exercised in accordance with the Collateral Management Agreement, the acquisition of such Workout Loan is advisable to increase the recovery value with respect to the related Collateral Obligation or the failure to acquire such Workout Loan is reasonably likely to result in a reduced overall recovery with respect to the related Collateral Obligation. Any such acquisition of a Workout Loan shall not be subject to the Investment Criteria. For the avoidance of doubt, Contributions may be used to acquire Workout Loans without any restrictions under this paragraph so long as in the Collateral Manager’s judgment exercised in accordance with the Collateral Management Agreement, the acquisition of such Workout Loan is advisable to increase the recovery value with respect to the related Collateral Obligation, or the failure to acquire such Workout Loan is reasonably likely to result in a reduced overall recovery with respect to the related Collateral Obligation. Notwithstanding anything in this Indenture or the Collateral Management Agreement to the contrary, the Collateral Manager may enter into commitments to acquire Collateral Obligations on the basis of Principal Proceeds which have not yet been received, but (x) which will be received by the Issuer from the sale of Collateral Obligations for which the trade date has already occurred but the settlement date has not yet occurred or (y) with respect to which the Collateral Manager reasonably expects to receive such Principal Proceeds or has received written notice from the Obligor, administrative agent or other similar Person in writing that such Principal Proceeds are scheduled to be paid (including, without limitation, by the dissemination or posting to an internet site of a report stating or indicating that such payment is scheduled to be paid).
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