Analyzing Intercreditor Agreements

Evaluates intercreditor and subordination provisions with lien priority, payment waterfall, and enforcement rights analysis.

When To Use

• Reviewing an intercreditor agreement (ICA) between first-lien and second-lien lenders in a leveraged financing
• Evaluating subordination mechanics in a unitranche with an Agreement Among Lenders (AAL)
• Assessing enforcement standstill periods, purchase option rights, or turnover obligations before a new deal closes
• Comparing intercreditor terms against market standards for a credit committee memo
• Analyzing split-collateral or cross-collateral structures in multi-tranche facilities

Inputs To Gather

• Intercreditor agreement or AAL — full executed document (including all exhibits and schedules)
• Related credit agreements — first-lien and second-lien (or senior/mezzanine) facility agreements to cross-reference definitions and covenants
• Collateral descriptions — security agreements, pledge agreements, and any collateral allocation schedules
• Structural diagram (if available) — organizational chart showing borrower/guarantor entities and lien attachment points
• Deal context — transaction type (LBO, recap, add-on), approximate leverage levels, and whether the ICA is being negotiated or reviewed post-execution