Exhibit 10.1

EXECUTION VERSION

 

 

 

 

LOGO [g796283g0827091420358.jpg]

CREDIT AGREEMENT

dated as of

August 26, 2019

among

GOGO INTERMEDIATE HOLDINGS LLC

and

GOGO FINANCE CO. INC.,

as the Borrowers

The Other Loan Parties Party Hereto

The Lenders Party Hereto

JPMORGAN CHASE BANK, N.A.,

as Administrative Agent

and

MORGAN STANLEY SENIOR FUNDING, INC.,

as Syndication Agent

 

 

JPMORGAN CHASE BANK, N.A. and

MORGAN STANLEY SENIOR FUNDING, INC.,

as Joint Bookrunners and Joint Lead Arrangers

ASSET BASED LENDING

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TABLE OF CONTENTS

 

     Page  

ARTICLE I Definitions

     5  

SECTION 1.01. Defined Terms

     5  

SECTION 1.02. Classification of Loans and Borrowings

     48  

SECTION 1.03. Terms Generally

     49  

SECTION 1.04. Accounting Terms; GAAP

     49  

SECTION 1.05. Interest Rates; LIBOR Notifications

     50  

SECTION 1.06. Pro Forma Calculations

     51  

SECTION 1.07. Status of Obligations

     52  

SECTION 1.08. Divisions

     52  

SECTION 1.09. Exchange Rates; Currency Equivalents

     52  

ARTICLE II The Credits

     53  

SECTION 2.01. Commitments

     53  

SECTION 2.02. Loans and Borrowings

     53  

SECTION 2.03. Requests for Borrowings

     53  

SECTION 2.04. Protective Advances

     54  

SECTION 2.05. Swingline Loans and Overadvances

     55  

SECTION 2.06. Letters of Credit

     56  

SECTION 2.07. Funding of Borrowings

     61  

SECTION 2.08. Interest Elections

     62  

SECTION 2.09. Termination and Reduction of Commitments; Increase in Revolving
Commitments

     63  

SECTION 2.10. Repayment and Amortization of Loans; Evidence of Debt

     64  

SECTION 2.11. Prepayment of Loans

     65  

SECTION 2.12. Fees

     66  

SECTION 2.13. Interest

     67  

SECTION 2.14. Alternate Rate of Interest; Illegality

     68  

SECTION 2.15. Increased Costs

     69  

SECTION 2.16. Break Funding Payments

     70  

SECTION 2.17. Withholding of Taxes; Gross-Up

     70  

SECTION 2.18. Payments Generally; Allocation of Proceeds; Sharing of Setoffs

     74  

SECTION 2.19. Mitigation Obligations; Replacement of Lenders or Issuing Banks

     76  

SECTION 2.20. Defaulting Lenders

     77  

SECTION 2.21. Returned Payments

     79  

SECTION 2.22. Banking Services and Swap Agreements

     79  

ARTICLE III Representations and Warranties

     80  

SECTION 3.01. Organization; Powers

     80  

SECTION 3.02. Authorization; Enforceability

     80  

SECTION 3.03. Governmental Approvals; No Conflicts

     80  

SECTION 3.04. Financial Condition; No Material Adverse Change

     80  

SECTION 3.05. Properties

     81  

SECTION 3.06. Litigation and Environmental Matters

     81  

SECTION 3.07. Compliance with Laws and Agreements; No Default

     81  

SECTION 3.08. Investment Company Status

     81  

SECTION 3.09. Taxes

     81  

SECTION 3.10. Pension Plans

     82  

SECTION 3.11. Disclosure

     82  

 

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SECTION 3.12. Solvency

     82  

SECTION 3.13. Insurance

     83  

SECTION 3.14. Capitalization and Subsidiaries

     83  

SECTION 3.15. Security Interest in Collateral

     83  

SECTION 3.16. Employment Matters

     83  

SECTION 3.17. Margin Regulations

     84  

SECTION 3.18. Anti-Corruption Laws and Sanctions

     84  

SECTION 3.19. Use of Proceeds

     84  

SECTION 3.20. Common Enterprise

     84  

SECTION 3.21. EEA Financial Institutions

     84  

SECTION 3.22. Plan Assets; Prohibited Transactions

     84  

SECTION 3.23. Regulatory Matters

     85  

ARTICLE IV Conditions

     85  

SECTION 4.01. Effective Date

     85  

SECTION 4.02. Each Credit Event

     87  

ARTICLE V Affirmative Covenants

     88  

SECTION 5.01. Financial Statements; Borrowing Base and Other Information

     88  

SECTION 5.02. Notices of Material Events

     91  

SECTION 5.03. Existence; Conduct of Business

     92  

SECTION 5.04. Payment of Obligations

     92  

SECTION 5.05. Maintenance of Properties

     92  

SECTION 5.06. Books and Records; Inspection Rights

     93  

SECTION 5.07. Compliance with Laws and Material Contractual Obligations

     93  

SECTION 5.08. Use of Proceeds

     93  

SECTION 5.09. [Reserved]

     94  

SECTION 5.10. Insurance

     94  

SECTION 5.11. Casualty and Condemnation

     94  

SECTION 5.12. [Reserved]

     94  

SECTION 5.13. Additional Collateral; Further Assurances; Additional Loan Parties

     94  

ARTICLE VI Negative Covenants

     95  

SECTION 6.01. Indebtedness

     95  

SECTION 6.02. Liens

     98  

SECTION 6.03. Fundamental Changes

     100  

SECTION 6.04. Investments, Loans, Advances, Guarantees and Acquisitions

     101  

SECTION 6.05. Asset Sales

     102  

SECTION 6.06. Sale and Leaseback Transactions

     103  

SECTION 6.07. Swap Agreements

     103  

SECTION 6.08. Restricted Payments; Certain Payments of Indebtedness

     103  

SECTION 6.09. Transactions with Affiliates

     104  

SECTION 6.10. Restrictive Agreements

     105  

SECTION 6.11. Amendment of Material Documents

     105  

SECTION 6.12. Regulatory Matters

     106  

SECTION 6.13. Fixed Charge Coverage Ratio

     106  

SECTION 6.14. Canadian Pension Plans

     106  

ARTICLE VII Events of Default

     107  

ARTICLE VIII The Administrative Agent

     109  

SECTION 8.01. Authorization and Action

     109  

SECTION 8.02. Administrative Agent’s Reliance, Indemnification, Etc.

     112  

SECTION 8.03. Posting of Communications

     113  

SECTION 8.04. The Administrative Agent Individually

     115  

SECTION 8.05. Successor Administrative Agent

     115  

 

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SECTION 8.06. Acknowledgements of Lenders and Issuing Bank

     116  

SECTION 8.07. Collateral Matters

     117  

SECTION 8.08. Credit Bidding

     117  

SECTION 8.09. Certain ERISA Matters

     118  

SECTION 8.10. Flood Laws

     120  

SECTION 8.11. Intercreditor Agreement

     120  

ARTICLE IX Miscellaneous

     120  

SECTION 9.01. Notices

     120  

SECTION 9.02. Waivers; Amendments

     121  

SECTION 9.03. Expenses; Indemnity; Damage Waiver

     124  

SECTION 9.04. Successors and Assigns

     126  

SECTION 9.05. Survival

     130  

SECTION 9.06. Counterparts; Integration; Effectiveness; Electronic Execution

     130  

SECTION 9.07. Severability

     130  

SECTION 9.08. Right of Setoff

     130  

SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of Process

     131  

SECTION 9.10. WAIVER OF JURY TRIAL

     132  

SECTION 9.11. Headings

     132  

SECTION 9.12. Confidentiality

     132  

SECTION 9.13. Several Obligations; Nonreliance; Violation of Law

     133  

SECTION 9.14. USA PATRIOT Act

     133  

SECTION 9.15. Disclosure

     133  

SECTION 9.16. Appointment for Perfection

     133  

SECTION 9.17. Interest Rate Limitation

     134  

SECTION 9.18. Marketing Consent

     134  

SECTION 9.19. Acknowledgement and Consent to Bail-In of EEA Financial
Institutions

     134  

SECTION 9.20. No Fiduciary Duty, etc.

     134  

SECTION 9.21. Acknowledgement Regarding Any Supported QFCs

     135  

SECTION 9.22. Canadian Anti-Money Laundering Legislation

     136  

SECTION 9.23. Judgment Currency

     136  

ARTICLE X Loan Guaranty

     137  

SECTION 10.01. Guaranty

     137  

SECTION 10.02. Guaranty of Payment

     137  

SECTION 10.03. No Discharge or Diminishment of Loan Guaranty

     137  

SECTION 10.04. Defenses Waived

     138  

SECTION 10.05. Rights of Subrogation

     138  

SECTION 10.06. Reinstatement; Stay of Acceleration

     138  

SECTION 10.07. Information

     138  

SECTION 10.08. Termination

     139  

SECTION 10.09. Taxes

     139  

SECTION 10.10. Maximum Liability

     139  

SECTION 10.11. Contribution

     139  

SECTION 10.12. Liability Cumulative

     140  

SECTION 10.13. Keepwell

     140  

SECTION 10.14. Releases

     140  

ARTICLE XI The Borrower Representative

     141  

SECTION 11.01. Appointment; Nature of Relationship

     141  

SECTION 11.02. Powers

     142  

SECTION 11.03. Employment of Agents

     142  

SECTION 11.04. Notices

     142  

SECTION 11.05. Successor Borrower Representative

     142  

SECTION 11.06. Execution of Loan Documents; Borrowing Base Certificate

     142  

 

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SCHEDULES:

 

Schedule 1.01    —    Commitments Schedule 3.06    —    Disclosed Matters
Schedule 3.13    —    Insurance Schedule 3.14    —    Capitalization and
Subsidiaries Schedule 6.01    —    Existing Indebtedness Schedule 6.02    —   
Existing Liens Schedule 6.04    —    Existing Investments Schedule 6.10    —   
Existing Restrictions

EXHIBITS:

 

Exhibit A

   —   

Form of Assignment and Assumption

Exhibit B

   —   

Form of Borrowing Request

Exhibit C

   —   

Form of Borrowing Base Certificate

Exhibit D

   —   

Form of Compliance Certificate

Exhibit E

   —   

Joinder Agreement

Exhibit F-1

   —   

U.S. Tax Certificate (For Foreign Lenders that are not Partnerships for U.S.
Federal Income Tax Purposes)

Exhibit F-2

   —   

U.S. Tax Certificate (For Foreign Participants that are not Partnerships for
U.S. Federal Income Tax Purposes)

Exhibit F-3

   —   

U.S. Tax Certificate (For Foreign Participants that are Partnerships for U.S.
Federal Income Tax Purposes)

Exhibit F-4

   —   

U.S. Tax Certificate (For Foreign Lenders that are Partnerships for U.S. Federal
Income Tax Purposes)

Exhibit G

   —   

Form of Interest Election Request

Exhibit H

   —    Form of Intercompany Note

 

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CREDIT AGREEMENT dated as of August 26, 2019 (as it may be amended or modified
from time to time, this “Agreement”) among GOGO INTERMEDIATE HOLDINGS LLC, a
Delaware limited liability company, and GOGO FINANCE CO. INC., a Delaware
corporation, as Borrowers, the other Loan Parties party hereto, the Lenders
party hereto, and JPMORGAN CHASE BANK, N.A., as Administrative Agent.

The parties hereto agree as follows:

ARTICLE I

Definitions

SECTION 1.01. Defined Terms. As used in this Agreement, the following terms have
the meanings specified below:

“ABR”, when used in reference to (a) a rate of interest, refers to the Alternate
Base Rate, and (b) any Loan or Borrowing, refers to whether such Loan, or the
Loans comprising such Borrowing, bear interest at a rate determined by reference
to the Alternate Base Rate.

“ABL Priority Collateral” shall have the meaning assigned to such term in the
Senior Secured Notes Intercreditor Agreement but, for the avoidance of doubt,
shall mean all Collateral consisting of the following:

(1) all Accounts (other than Accounts which constitute identifiable Proceeds of
Cash Flow Priority Collateral);

(2) (x) all Deposit Accounts and Money and all cash, checks, other negotiable
instruments, funds and other evidences of payments held therein and (y) all
Securities, Security Entitlements, and Securities Accounts, in each case, to the
extent constituting cash or Cash Equivalents or representing a claim to Cash
Equivalents, in each case other than (i) the Asset Sales Proceeds Account and
all cash, checks and other property held therein or credited thereto,
(ii) Capital Stock of the Company and its direct and indirect Subsidiaries and
(iii) identifiable Proceeds of Cash Flow Priority Collateral;

(3) all Inventory;

(4) to the extent evidencing or governing any of the items referred to in the
preceding clauses (1) through (3), all Chattel Paper (including Tangible Chattel
Paper and Electronic Chattel Paper), all Documents, General Intangibles
(including data processing software and excluding Intellectual Property and
Capital Stock of the Company and its direct and indirect Subsidiaries),
Instruments (including, without limitation, Promissory Notes), Letter-of-Credit
Rights and Commercial Tort Claims, provided that to the extent any of the
foregoing also relates to Cash Flow Priority Collateral, only that portion
related to the items referred to in the preceding clauses (1) through (3) shall
be included in the ABL Priority Collateral;

(5) to the extent evidencing or governing any of the items referred to in the
preceding clauses (1) through (4), all Supporting Obligations; provided that to
the extent any of the foregoing also relates to Cash Flow Priority Collateral
only that portion related to the items referred to in the preceding clauses
(1) through (4) shall be included in the ABL Priority Collateral;

 

5

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(6) all books and Records relating to the foregoing (including without
limitation all books, databases, customer lists, and Records, whether tangible
or electronic, which contain any information relating to any of the foregoing);
and

(7) all collateral security and guarantees with respect to any of the foregoing
and all cash, Money, instruments, securities (other than Capital Stock of the
Company and its direct and indirect Subsidiaries), financial assets, Investment
Property (other than Capital Stock of the Company and its direct and indirect
Subsidiaries), insurance proceeds and deposit accounts directly received as
Proceeds of any ABL Priority Collateral described in the preceding clauses
(1) through (5) (such Proceeds, “ABL Priority Proceeds”); provided, however,
that no Proceeds of ABL Priority Proceeds will constitute ABL Priority
Collateral unless such Proceeds of ABL Priority Proceeds would otherwise
constitute ABL Priority Collateral.

For purposes of this definition, capitalized terms used but not defined in this
Agreement shall have the meaning set forth in the Senior Secured Notes
Intercreditor Agreement.

“Account” has the meaning assigned to such term in the U.S. Security Agreement
or the Canadian Security Agreement, as applicable. For the avoidance of doubt,
Accounts shall include Credit Card Receivables.

“Account Debtor” means any Person obligated on an Account.

“Acquisition” means any transaction, or any series of related transactions,
consummated on or after the Effective Date, by which any Loan Party or any
Subsidiary (a) acquires any going business or all or substantially all of the
assets of any Person, whether through purchase of assets, merger, amalgamation
or otherwise or (b) directly or indirectly acquires (in one transaction or as
the most recent transaction in a series of transactions) at least a majority (in
number of votes) of the Equity Interests of a Person which has ordinary voting
power for the election of directors or other similar management personnel of a
Person (other than Equity Interests having such power only by reason of the
happening of a contingency) or a majority of the outstanding Equity Interests of
a Person.

“Additional Secured Indebtedness” means Indebtedness of the Loan Parties
permitted to be incurred under Section 6.01(j).

“Additional Secured Indebtedness Documents” means, collectively, all agreements,
instruments, documents and certificates executed and/or delivered in connection
with any Additional Secured Indebtedness (including any and all collateral
documents), as the same may be amended, restated, supplemented or otherwise
modified from time to time in accordance with the terms hereof and of the
applicable Intercreditor Agreement.

“Additional Secured Indebtedness Intercreditor Agreement” means any “crossing
liens” or “junior liens” intercreditor agreement in form and substance
reasonably satisfactory to the Administrative Agent between the Administrative
Agent and one or more representatives for holders of Additional Secured
Indebtedness subordinating such holders’ Liens on the ABL Priority Collateral
and all or any portion of any other Collateral to the Liens granted in favor of
the Administrative Agent and the Secured Parties to secure the Secured
Obligations to the reasonable satisfaction of the Administrative Agent, as the
same may be amended, restated, supplemented or otherwise modified in accordance
with the terms thereof.

“Additional Secured Indebtedness Obligations” means the Indebtedness and other
obligations of the Parent and its Subsidiaries under any Additional Secured
Indebtedness Documents.

 

6

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“Adjusted LIBO Rate” means, with respect to any Eurodollar Borrowing for any
Interest Period or for any ABR Borrowing, an interest rate per annum (rounded
upwards, if necessary, to the next 1/16 of 1%) equal to (a) the LIBO Rate for
such Interest Period multiplied by (b) the Statutory Reserve Rate.

“Administrative Agent” means JPMorgan Chase Bank, N.A., in its capacity as
administrative agent for the Lenders hereunder.

“Administrative Questionnaire” means an Administrative Questionnaire in a form
supplied by the Administrative Agent.

“Affiliate” means, with respect to a specified Person, another Person that
directly, or indirectly through one or more intermediaries, Controls or is
Controlled by or is under common Control with the specified Person.

“Agent Indemnitee” has the meaning assigned to it in Section 9.03(c).

“Aggregate Revolving Commitment” means, at any time, the aggregate of the
Revolving Commitments of all of the Lenders, as increased or reduced from time
to time pursuant to the terms and conditions hereof. As of the Effective Date,
the Aggregate Revolving Commitment is Thirty Million Dollars ($30,000,000).

“Aggregate Revolving Exposure” means, at any time, the aggregate Revolving
Exposure of all the Lenders at such time.

“Alternate Base Rate” means, for any day, a rate per annum equal to the greatest
of (a) the Prime Rate in effect on such day, (b) the NYFRB Rate in effect on
such day plus 1⁄2 of 1% and (c) the Adjusted LIBO Rate for a one month Interest
Period on such day (or if such day is not a Business Day, the immediately
preceding Business Day) plus 1%, provided that, for the purpose of this
definition, the Adjusted LIBO Rate for any day shall be based on the LIBO Screen
Rate (or if the LIBO Screen Rate is not available for such one month Interest
Period, the Interpolated Rate) at approximately 11:00 a.m. London time on such
day. Any change in the Alternate Base Rate due to a change in the Prime Rate,
the NYFRB Rate or the Adjusted LIBO Rate shall be effective from and including
the effective date of such change in the Prime Rate, the NYFRB Rate or the
Adjusted LIBO Rate, respectively. If the Alternate Base Rate is being used as an
alternate rate of interest pursuant to Section 2.14, then the Alternate Base
Rate shall be the greater of clause (a) and (b) above and shall be determined
without reference to clause (c) above. For the avoidance of doubt, if the
Alternate Base Rate as determined pursuant to the foregoing would be less than
1.00%, such rate shall be deemed to be 1.00% for purposes of this Agreement.

“Anti-Corruption Laws” means the U.S. Foreign Corrupt Practices Act of 1977, as
amended, and similar laws, rules, and regulations of any jurisdiction applicable
to the Parent or any of its Subsidiaries from time to time concerning or
relating to bribery or corruption (including Canadian Anti-Money Laundering &
Anti-Terrorism Legislation), and to which they are lawfully subject.

“Applicable Ancillary Obligations Reserve” means, as of any date of
determination, the aggregate amount of Banking Services Obligations and Swap
Agreement Obligations at such time.

“Applicable Parties” has the meaning assigned to it in Section 8.03(c).

“Applicable Percentage” means, with respect to any Lender, with respect to
Revolving Loans, LC Exposure, Protective Advances, Overadvances or Swingline
Loans, a percentage equal to a fraction the numerator of which is such Lender’s
Revolving Commitment and the denominator of which is the

 

7

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Aggregate Revolving Commitment (provided that, if the Revolving Commitments have
terminated or expired, the Applicable Percentages shall be determined based upon
such Lender’s share of the Aggregate Revolving Exposure at that time); provided
that, in accordance with Section 2.20, so long as any Lender shall be a
Defaulting Lender, such Defaulting Lender’s Commitment shall be disregarded in
the foregoing calculation.

“Applicable Rate” means the following:

(a) For any day, with respect to any Loan, the applicable rate per annum set
forth below under the caption “Revolver ABR Spread” or “Revolver Eurodollar
Spread”, as the case may be, based upon the Fixed Charge Coverage Ratio as of
the most recent determination date, provided that the “Applicable Rate” shall be
the applicable rates per annum set forth below in Category 3 during the period
from the Effective Date to, and including, the last day of the first full fiscal
quarter of the Parent ending after the Effective Date:

 

Fixed Charge Coverage

Ratio

   Revolver ABR
Spread     Revolver Eurodollar
Spread  

Category 1 > 1.50 to 1.00

     0.50 %      1.50 % 

Category 2 £ 1.50 to 1.00 but > 1.00 to 1.00

     0.75 %      1.75 % 

Category 3 £ 1.00 to 1.00

     1.00 %      2.00 % 

For purposes of the foregoing table in this clause (a), (i) the Applicable Rate
shall be determined as of the end of each fiscal quarter of the Parent based
upon the Parent’s annual or quarterly consolidated financial statements
delivered pursuant to Section 5.01 and (ii) each change in the Applicable Rate
resulting from a change in the Fixed Charge Coverage Ratio shall be effective
during the period commencing on and including the date of delivery to the
Administrative Agent of such consolidated financial statements indicating such
change and ending on the date immediately preceding the effective date of the
next such change, provided that the Fixed Charge Coverage Ratio shall be deemed
to be in Category 3 at the option of the Administrative Agent or at the request
of the Required Lenders if the Parent fails to deliver the annual or quarterly
consolidated financial statements required to be delivered by it pursuant to
Section 5.01, during the period from the expiration of the time for delivery
thereof until such consolidated financial statements are delivered.

(b) For any day, with respect to the commitment fees payable pursuant to
Section 2.12(a) hereunder, the applicable rate per annum set forth below under
the caption “Commitment Fee Rate”, based upon the Average Quarterly Usage during
the most recently ended fiscal quarter of the Parent; provided that the
“Applicable Rate” shall be the applicable rates per annum set forth below in
Category 2 during the period from the Effective Date to, and including, the last
day of the first full fiscal quarter of the Parent ending after the Effective
Date:

 

Average Quarterly Usage

   Commitment
Fee Rate  

Category 1 ³ 50% of the Aggregate Revolving Commitment

     0.25 % 

Category 2 < 50% of the Aggregate Revolving Commitment

     0.375 % 

 

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For purposes of the foregoing table in this clause (b), the Applicable Rate
shall be determined as of the last day of any fiscal quarter of the Parent and
shall be effective during the quarterly period commencing on the first day of
the subsequent fiscal quarter of the Parent.

“Approved Electronic Platform” has the meaning assigned to it in
Section 8.03(a).

“Approved Fund” has the meaning assigned to such term in Section 9.04.

“Arrangers” means JPMorgan Chase Bank, N.A. and Morgan Stanley Senior Funding,
Inc., each in their capacity as joint bookrunners and joint lead arrangers
hereunder.

“Assignment and Assumption” means an assignment and assumption agreement entered
into by a Lender and an assignee (with the consent of any party whose consent is
required by Section 9.04), and accepted by the Administrative Agent, in the form
of Exhibit A or any other form (including electronic records generated by the
use of an electronic platform) approved by the Administrative Agent.

“Attributable Debt” in respect of a sale-leaseback transaction means, at the
time of determination, the present value of the obligation of the lessee for net
rental payments during the remaining term of the lease included in such
sale-leaseback transaction including any period for which such lease has been
extended or may, at the option of the lessor, be extended. Such present value
shall be calculated using a discount rate equal to the rate of interest implicit
in such transaction, determined in accordance with GAAP; provided, however, that
if such sale-leaseback transaction results in a Capital Lease Obligation, the
amount of Indebtedness represented thereby will be determined in accordance with
the definition of “Capital Lease Obligations.”

“Availability” means, at any time, an amount equal to (a) the lesser of (i) the
Aggregate Revolving Commitment minus the Applicable Ancillary Obligations
Reserve and (ii) the Borrowing Base minus (b) the Aggregate Revolving Exposure
(calculated, with respect to any Defaulting Lender, as if such Defaulting Lender
had funded its Applicable Percentage of all outstanding Borrowings).

“Availability Period” means the period from and including the Effective Date to
but excluding the earlier of the Maturity Date and the date of termination of
the Commitments.

“Available Revolving Commitment” means, at any time, the Aggregate Revolving
Commitment minus the Aggregate Revolving Exposure (calculated, with respect to
any Defaulting Lender, as if such Defaulting Lender had funded its Applicable
Percentage of all outstanding Borrowings).

“Average Quarterly Usage” means, in determining the Available Revolving
Commitment for purposes of computing the commitment fee described in
Section 2.12(a) for any fiscal quarter of the Parent, an amount equal to the
average daily Aggregate Revolving Exposure during such quarter (calculated, with
respect to any Defaulting Lender, as if such Defaulting Lender had funded its
Applicable Percentage of all outstanding Borrowings).

 

9

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“Bail-In Action” means the exercise of any Write-Down and Conversion Powers by
the applicable EEA Resolution Authority in respect of any liability of an EEA
Financial Institution.

“Bail-In Legislation” means, with respect to any EEA Member Country implementing
Article 55 of Directive 2014/59/EU of the European Parliament and of the Council
of the European Union, the implementing law for such EEA Member Country from
time to time which is described in the EU Bail-In Legislation Schedule.

“Banking Services” means each and any of the following bank services provided to
any Loan Party by the Administrative Agent any Lender or any of their
Affiliates: treasury, investment, depository, clearing house, wire transfer,
cash management or automated clearing house transfers of funds services or any
related services.

“Banking Services Obligations” means any and all obligations of the Loan Parties
(other than Parent), whether absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor) in connection with Banking
Services; provided, that the Administrative Agent has been notified of such
obligations pursuant to Section 2.22(a).

“Banking Services Reserves” means all Reserves which the Administrative Agent
from time to time establishes in its Permitted Discretion for Banking Services
then provided or outstanding.

“Bankruptcy Code” means Title 11 of the United States Code entitled
“Bankruptcy”, as now and hereafter in effect, or any successor statute.

“Bankruptcy Event” means, with respect to any Person, when such Person becomes
the subject of a voluntary or involuntary bankruptcy or insolvency proceeding,
or has had a receiver, conservator, trustee, administrator, custodian, assignee
for the benefit of creditors or similar Person charged with the reorganization
or liquidation of its business, appointed for it, or, in the good faith
determination of the Administrative Agent, has taken any action in furtherance
of, or indicating its consent to, approval of, or acquiescence in, any such
proceeding or appointment or has had any order for relief in such proceeding
entered in respect thereof, provided that a Bankruptcy Event shall not result
solely by virtue of any ownership interest, or the acquisition of any ownership
interest, in such Person by a Governmental Authority or instrumentality thereof,
unless such ownership interest results in or provides such Person with immunity
from the jurisdiction of courts within the U.S. or from the enforcement of
judgments or writs of attachment on its assets or permits such Person (or such
Governmental Authority or instrumentality), to reject, repudiate, disavow or
disaffirm any contracts or agreements made by such Person.

“Beneficial Ownership Certification” means a certification regarding beneficial
ownership or control as required by the Beneficial Ownership Regulation.

“Beneficial Ownership Regulation” means 31 C.F.R. § 1010.230.

“Benefit Plan” means any of (a) an “employee benefit plan” (as defined in
Section 3(3) of ERISA) that is subject to Title I of ERISA, (b) a “plan” as
defined in Section 4975 of the Code to which Section 4975 of the Code applies,
and (c) any Person whose assets include (for purposes of the Plan Asset
Regulations or otherwise for purposes of Title I of ERISA or Section 4975 of the
Code) the assets of any such “employee benefit plan” or “plan”.

 

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“BHC Act Affiliate” of a party means an “affiliate” (as such term is defined
under, and interpreted in accordance with, 12 U.S.C. 1841(k)) of such party.

“Billed Account” means an Account in respect of which an invoice has been issued
to the related Account Debtor.

“Borrower” or “Borrowers” means, individually or collectively, the Company and
Gogo Finance Co., Inc., a Delaware corporation.

“Borrower Representative” has the meaning assigned to such term in
Section 11.01.

“Borrowing” means Revolving Loans of the same Type, made, converted or continued
on the same date and, in the case of Eurodollar Loans, as to which a single
Interest Period is in effect, (b) a Swingline Loan, (c) a Protective Advance and
(d) an Overadvance.

“Borrowing Base” means, at any time, the sum of (a) 85% of the Loan Parties’
Eligible Accounts that are Billed Accounts at such time, plus (b) 90% of the
Loan Parties’ Eligible Credit Card Receivables, plus (c) 75% of the Loan
Parties’ Eligible Accounts that are Unbilled Accounts at such time (in an
aggregate amount not to exceed 33% of the Borrowing Base), minus (d) Reserves
established by the Administrative Agent in its Permitted Discretion.

The Administrative Agent may, in its Permitted Discretion, add or adjust
Reserves, including reserves with respect to sums that the Loan Parties are or
will be required to pay (such as sales, excise or similar taxes) and have not
yet paid; provided, that, the Administrative Agent shall have provided the
Borrower Representative five (5) Business Days (or, during any Cash Dominion
Period, one (1) Business Day) prior written notice thereof, setting forth in
reasonable detail the basis therefor; and provided, further, that (A) if
Borrowings are requested at any time after the Administrative Agent has provided
such notice, the Borrowing Base shall be adjusted to give effect to such
Reserves prior to any such Borrowing; (B) any new or increased reserves
established by the Administrative Agent shall have a reasonable relationship to
the event, condition, circumstance or fact that is the basis therefor; and
(C) any such establishment or increase in reserves shall be removed if the
Administrative Agent has determined in its Permitted Discretion that the event,
condition or other matter that is the basis for such establishment or increase
in reserves no longer exists. The Borrowing Base shall be determined by
reference to the Borrowing Base Certificate most recently delivered to the
Administrative Agent pursuant to Section 5.01(g), subject to adjustments and
changes made by the Administrative Agent in its Permitted Discretion as provided
above or otherwise in accordance with this Agreement, and adjusted by the
Administrative Agent in accordance with this Agreement based upon additional
information, if any, received after the date of delivery of any such Borrowing
Base Certificate.

Notwithstanding the foregoing, for purposes of this definition, no Accounts
being acquired pursuant to a Permitted Acquisition or permitted Investment will
be included in the Borrowing Base unless (i) the Administrative Agent, in its
Permitted Discretion, confirms that such Accounts conform to standards of
eligibility in accordance with this Agreement, and (ii) to the extent required
by the Administrative Agent, a field examination of such Accounts is conducted
and then only so long as such Accounts would otherwise satisfy the eligibility
criteria (it being understood that any such field examination, to the extent
required by the Administrative Agent, shall be conducted at the Borrower’s
expense).

The Administrative Agent shall use commercially reasonable efforts, at the
expense of the Loan Parties, to cause a field examination in respect of Accounts
acquired pursuant to any Permitted Acquisition or permitted Investment
reasonably promptly following a request of the Borrower Representative.

 

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“Borrowing Base Certificate” means a certificate, signed and certified as
accurate and complete by a Financial Officer of the Parent, in substantially the
form of Exhibit C or another form which is acceptable to the Administrative
Agent in its reasonable discretion.

“Borrowing Base Party” means each Loan Party; provided that Gogo Canada shall
only become a Borrowing Base Party from and after the Borrowing Base Party
Joinder Date.

“Borrowing Base Party Joinder Date” means the first date after the Effective
Date on which the following conditions have been satisfied with respect to Gogo
Canada:

(a) Gogo Canada shall constitute a Loan Party;

(b) The Administrative Agent (or its counsel) shall have received (i) either (A)
a counterpart of the Canadian Security Agreement reasonably required by the
Administrative Agent in connection therewith signed on behalf of each party
thereto or (B) written evidence satisfactory to the Administrative Agent (which
may include facsimile or other electronic transmission of a signed signature
page thereof) that each such party has signed a counterpart of such Loan
Document and (ii) such other certificates, documents, instruments and agreements
as the Administrative Agent shall reasonably request in connection with the
addition of Gogo Canada as a Borrowing Base Party, including written opinions of
Gogo Canada’s counsel, addressed to the Administrative Agent, the Issuing Bank
and the Lenders in form and substance reasonably satisfactory to the
Administrative Agent and its counsel;

(c) The Administrative Agent shall have received the results of a recent lien
search in each jurisdiction reasonably required by the Administrative Agent, and
such searches shall reveal no Liens on any of the assets of Gogo Canada except
for Liens permitted by Section 6.02 or discharged on or prior to the Borrowing
Base Party Joinder Date pursuant to a pay-off letter or other documentation
reasonably satisfactory to the Administrative Agent (it being understood that
certain Liens permitted by Section 6.02 may prevent the Accounts of Gogo Canada
from being Eligible Accounts or Eligible Credit Card Receivables);

(d) The Administrative Agent shall have received a true and complete customer
list for Gogo Canada, which list shall state the customer’s name, mailing
address and phone number;

(e) The Administrative Agent shall have received each Deposit Account Control
Agreement required to be provided pursuant to the Canadian Security Agreement;

(f) Each document (including any Uniform Commercial Code financing statement,
PPSA financing statement, RDPRM (Quebec) recordings or other notices in respect
thereof) required by the Collateral Documents or under law or reasonably
requested by the Administrative Agent to be filed, registered or recorded in
order to create in favor of the Administrative Agent, for the benefit of itself,
the Lenders and the other Secured Parties, a perfected Lien on the Collateral
described therein under Canadian law, prior and superior in right to any other
Person (other than with respect to Liens expressly permitted by Section 6.02),
shall be in proper form for filing, registration or recordation;

(g) The Administrative Agent shall have received evidence of insurance coverage
in form, scope, and substance reasonably satisfactory to the Administrative
Agent and otherwise in compliance with the terms of Section 5.10 hereof and the
Canadian Security Agreement;

 

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(h) The Administrative Agent or its designee shall have conducted a field
examination of Gogo Canada’s Accounts and related working capital matters and of
Gogo Canada’s related data processing and other systems, the results of which
shall be reasonably satisfactory to the Administrative Agent in its sole
discretion; and

(i) The Administrative Agent shall have received such other documents as the
Administrative Agent, the Issuing Bank, any Lender or their respective counsel
may have reasonably requested.

“Borrowing Request” means a request by the Borrower Representative for a
Borrowing in accordance with Section 2.03.

“Business Day” means any day that is not a Saturday, Sunday or other day on
which commercial banks in New York City are authorized or required by law to
remain closed; provided that, when used in connection with a Eurodollar Loan,
the term “Business Day” shall also exclude any day on which banks are not open
for general business in London.

“Canadian Anti-Money Laundering & Anti-Terrorism Legislation” means,
collectively, the Criminal Code, R.S.C. 1985, c. C-46, the Proceeds of Crime
(Money Laundering) and Terrorist Financing Act, S.C. 2000, c. 17 and the United
Nations Act, R.S.C. 1985, c. U-2 or any similar Canadian legislation, together
with all rules, regulations and interpretations thereunder or related thereto
including, without limitation, the Regulations Implementing the United Nations
Resolutions on the Suppression of Terrorism and the United Nations Al Qaida and
Taliban Regulations promulgated under the United Nations Act.

“Canadian Blocked Person” means any Person that is a “designated person”,
“politically exposed foreign person” or “terrorist group” as described in any
Canadian Economic Sanctions and Export Control Laws.

“Canadian Defined Benefit Plan” means a pension plan for the purposes of any
applicable pension benefits standards statute or regulation in Canada, which
contains a “defined benefit provision,” as defined in subsection 147.1(1) of the
Income Tax Act, R.S.C. 1985, c.1 (5th Supp.).

“Canadian Dollars” means dollars in the lawful currency of Canada.

“Canadian Economic Sanctions and Export Control Laws” means any Canadian laws,
regulations or orders governing transactions in controlled goods or technologies
or dealings with countries, entities, organizations, or individuals subject to
economic sanctions and similar measures, including the Special Economic Measures
Act, S.C. 1992, c. 17, the United Nations Act, R.S.C. 1985, c. U-2, the Freezing
Assets of Corrupt Foreign Officials Act, S.C. 2011, c. 10, Part II.1 of the
Criminal Code, R.S.C. 1985, c. C-46, and the Export and Import Permits Act,
R.S.C. 1985, c. E-19, and any related regulations.

“Canadian Guarantor” means Gogo Canada and each other Canadian Subsidiary who
has guaranteed the Secured Obligations.

“Canadian Pension Event” means (a) the whole or partial withdrawal of the
Canadian Guarantor or another Loan Party from a Canadian Pension Plan during a
plan year; or (b) the filing of a notice of intent to terminate in whole or in
part a Canadian Pension Plan or the treatment of a Canadian Pension Plan
amendment as a termination or partial termination; or (c) the institution of
proceedings by any Governmental Authority to terminate in whole or in part or
have a trustee appointed to administer a Canadian Pension Plan; or (d) any other
event or condition which might constitute grounds for the termination of,
winding up or partial termination of winding up or the appointment of trustee to
administer, any Canadian Pension Plan.

 

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“Canadian Pension Plan” means a pension plan that is covered by the applicable
pension standards laws of any jurisdiction in Canada including the Pension
Benefits Act, R.S.O. 1990, c. P.8, and the Income Tax Act, R.S.C. 1985, c.1 (5th
Supp.) and that is either (a) maintained or sponsored by the Canadian Guarantor
or any other Canadian Subsidiary for employees or (b) maintained pursuant to a
collective bargaining agreement, or other arrangement under which more than one
employer makes contributions and to which the Canadian Guarantor or any other
Canadian Subsidiary is making or accruing an obligation to make contributions or
has within the preceding five years made or accrued such contributions.

“Canadian Priority Payable Reserve” means the reserves established in the good
faith credit discretion of the Administrative Agent for amounts secured by any
Liens, choate or inchoate, which rank or are capable of ranking in priority to
the Administrative Agent’s Liens and/or for amounts which may represent costs
relating to the enforcement of the Administrative Agent’s Liens including,
without limitation, in the good faith credit discretion of the Administrative
Agent, any such amounts due and not paid for wages, salaries, commission or
compensation, including vacation pay (including, as provided for, under the Wage
Earners Protection Program Act, S.C. 2005, c. 47, s.1, amounts due and not paid
under any legislation relating to workers’ compensation or to employment
insurance, all amounts deducted or withheld and not paid and remitted when due
under the Income Tax Act, R.S.C. 1985, c.1 (5th Supp.), amounts currently or
past due and not paid for realty, municipal or similar taxes, any and and all
unfunded wind-up or solvency deficiency amounts under, and all amounts currently
or past due and not contributed, remitted or paid to or under any Canadian
Pension Plans or under the Canada Pension Plan, R.S.C. 1985, c. C-8), the
Pension Benefits Standards Act, S.B.C. 2012 c. 30, or any similar legislation.

“Canadian Security Agreement” means, if applicable, a Canadian ABL Collateral
Agreement (including any and all supplements thereto), dated as of the Borrowing
Base Party Joinder Date, among Gogo Canada, the other grantors from time to time
party thereto and the Administrative Agent for the benefit of the Administrative
Agent and the other Secured Parties, as the same may be amended, restated,
supplemented or otherwise modified from time to time.

“Capital Expenditures” means, without duplication, the aggregate of all
expenditures for any purchase or other acquisition of any asset which would be
classified as a fixed or capital asset on a consolidated statement of cash flows
of the Parent and its Subsidiaries prepared in accordance with GAAP; provided
that the term “Capital Expenditures” shall not include (i) expenditures made in
connection with the replacement, substitution, restoration or repair of assets
to the extent financed with (x) insurance proceeds paid on account of the loss
of or damage to the assets being replaced, substituted, restored or repaired or
(y) awards of compensation arising from the taking by eminent domain or
condemnation or expropriation of the assets being replaced, (ii) the portion of
the purchase price of property, plant and equipment that is purchased
substantially concurrently with the trade-in of existing property, plant or
equipment in an amount equal to the amount that the gross amount of such
purchase price is reduced by the credit granted by the seller of such property,
plant and equipment for the property, plant or equipment being traded in at such
time, (iii) the purchase of plant, property or equipment to the extent financed
with the proceeds of dispositions, (iv) expenditures that are accounted for as
capital expenditures by Parent or any Subsidiary and that actually are paid for
by a Person other than Parent or any Subsidiary and for which none of Parent or
any Subsidiary has provided or is required to provide or incur, directly or
indirectly, any consideration or obligation to such Person or any other Person
(whether before, during or after such period) other than rent and similar or
related obligations and (v) expenditures that constitute Permitted Acquisitions
or other Investments permitted hereunder.

 

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“Capital Lease Obligations” of any Person means the obligations of such Person
to pay rent or other amounts under any lease of (or other arrangement conveying
the right to use) real or personal property, or a combination thereof, which
obligations are required to be classified and accounted for as capital leases or
financing leases on a balance sheet of such Person under GAAP, and the amount of
such obligations shall be the capitalized amount thereof determined in
accordance with GAAP.

“Cash Dominion Period” shall mean any period of time, at the election of the
Administrative Agent or at the direction of the Required Lenders, (i) when an
Event of Default has occurred and is continuing or (ii) commencing with the date
on which Specified Availability is less than the greater of 15.0% of the
Aggregate Revolving Commitment and $4,500,000, and continuing until such
subsequent date as when Specified Availability has exceeded the greater of 15.0%
of the Aggregate Revolving Commitment and $4,500,000 for thirty (30) consecutive
days.

“Change in Control” means the occurrence of any one of the following events:

(a) the acquisition of ownership, directly or indirectly, beneficially or of
record, by any Person or group (within the meaning of the Securities Exchange
Act of 1934 and the rules of the SEC thereunder as in effect on the date
hereof), of Equity Interests representing more than (i) 50% of the aggregate
ordinary voting power represented by the issued and outstanding Equity Interests
of the Parent, in the case of the acquisition of ownership thereof by the
Permitted Holders, or (ii) of 35% of the aggregate ordinary voting power
represented by the issued and outstanding Equity Interests of the Parent, in the
case of the acquisition of ownership thereof by any Person or group other than
the Permitted Holders; or

(b) the Parent and/or its wholly owned Subsidiaries shall cease to own and
Control, 100% of the Equity Interests of the Borrowers.

“Change in Law” means the occurrence after the date of this Agreement (or, with
respect to any Lender, such later date on which such Lender becomes a party to
this Agreement) of any of the following: (a) the adoption of or taking effect of
any law, rule, regulation or treaty; (b) any change in any law, rule, regulation
or treaty or in the administration, interpretation, implementation or
application thereof by any Governmental Authority; or (c) compliance by any
Lender or the Issuing Bank (or, for purposes of Section 2.15(b), by any lending
office of such Lender or by such Lender’s or the Issuing Bank’s holding company,
if any) with any request, guideline, requirement or directive (whether or not
having the force of law) of any Governmental Authority made or issued after the
date of this Agreement; provided that notwithstanding anything herein to the
contrary, (x) the Dodd-Frank Wall Street Reform and Consumer Protection Act and
all requests, rules, guidelines, requirements or directives thereunder or issued
in connection therewith or in the implementation thereof, and (y) all requests,
rules, guidelines, requirements or directives promulgated by the Bank for
International Settlements, the Basel Committee on Banking Supervision (or any
successor or similar authority) or the United States or foreign regulatory
authorities, in each case pursuant to Basel III, shall in each case be deemed to
be a “Change in Law”, regardless of the date enacted, adopted, issued or
implemented.

“Charges” has the meaning assigned to such term in Section 9.17.

“Class”, when used in reference to any Loan or Borrowing, refers to whether such
Loan, or the Loans comprising such Borrowing, are Revolving Loans, Swingline
Loans, Protective Advances or Overadvances.

“Code” means the Internal Revenue Code of 1986, as amended from time to time.

 

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“Collateral” means any and all property owned, leased or operated by a Person
covered by the Collateral Documents and any and all other property of any Loan
Party, now existing or hereafter acquired, that may at any time be, become or be
intended to be, subject to a security interest or Lien in favor of the
Administrative Agent, on behalf of itself and the Lenders and the other Secured
Parties, to secure the Secured Obligations; provided that Collateral shall not
include any Excluded Assets.

“Collateral Account” has the meaning assigned to the term “Collateral Account”
in the U.S. Security Agreement, and any other collection account having a
similar purpose under the Canadian Security Agreement.

“Collateral Documents” means, collectively, the U.S. Security Agreement, the
Canadian Security Agreement and any other agreements, instruments and documents
executed in connection with this Agreement that are intended to create, perfect
or evidence Liens to secure the Secured Obligations.

“Commercial LC Exposure” means, at any time, the sum of (a) the aggregate
undrawn amount of all outstanding commercial Letters of Credit plus (b) the
aggregate amount of all LC Disbursements relating to commercial Letters of
Credit that have not yet been reimbursed by or on behalf of the Borrowers. The
Commercial LC Exposure of any Revolving Lender at any time shall be its
Applicable Percentage of the aggregate Commercial LC Exposure at such time.

“Commitment” means, with respect to each Lender, the sum of such Lender’s
Revolving Commitment, together with the commitment of such Lender to acquire
participations in Protective Advances hereunder. The initial amount of each
Lender’s Commitment is set forth on the Commitment Schedule, or in the
Assignment and Assumption or other documentation or record (as such term is
defined in Section 9-102(a)(70) of the New York Uniform Commercial Code) as
provided in Section 9.04(b)(ii)(C), pursuant to which such Lender shall have
assumed its Commitment, as applicable.

“Commitment Schedule” means the Schedule attached hereto identified as such.

“Commodity Exchange Act” means the Commodity Exchange Act (7 U.S.C. § 1 et
seq.), as amended from time to time, and any successor statute.

“Communications” has the meaning assigned to such term in Section 8.03(c).

“Communications Act” means the Communications Act of 1934, as amended, and any
similar or successor Federal statute, and the rules and regulations of the FCC
or any other similar or successor agency thereunder.

“Communications Laws” means all laws, rules, regulations, codes, ordinances,
orders, decrees, judgments, injunctions, notices or binding agreements issued,
promulgated or entered into by a Governmental Authority (including the FCC)
relating in any way to the use of radio frequency spectrum or the offering or
provision of video, communications, telecommunications or information services
(including the Communications Act).

“Company” means Gogo Intermediate Holdings LLC, a Delaware limited liability
company.

“Compliance Certificate” means a certificate of a Financial Officer of the
Parent in substantially the form of Exhibit D.

“Connection Income Taxes” means Other Connection Taxes that are imposed on or
measured by net income (however denominated) or that are franchise Taxes or
branch profits Taxes.

 

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“Control” means the possession, directly or indirectly, of the power to direct
or cause the direction of the management or policies of a Person, whether
through the ability to exercise voting power, by contract or otherwise.
“Controlling” and “Controlled” have meanings correlative thereto.

“Controlled Disbursement Account” means, collectively, accounts of the Borrowers
maintained with the Administrative Agent as a zero balance, cash management
account pursuant to and under any agreement between a Borrower and the
Administrative Agent, as modified and amended from time to time, and through
which all disbursements of a Borrower, any other Loan Party and any designated
Subsidiary of a Borrower are made and settled on a daily basis with no
uninvested balance remaining overnight.

“Convertible Notes” means the Parent’s 6.00% Convertible Senior Notes due 2022.

“Covered Entity” means any of the following:

 

  (i)

a “covered entity” as that term is defined in, and interpreted in accordance
with, 12 C.F.R. § 252.82(b);

 

  (ii)

a “covered bank” as that term is defined in, and interpreted in accordance with,
12 C.F.R. § 47.3(b); or

 

  (iii)

a “covered FSI” as that term is defined in, and interpreted in accordance with,
12 C.F.R. § 382.2(b).

“Covered Party” has the meaning assigned to it in Section 9.21.

“Credit Card Receivables” means any Accounts due to any Borrowing Base Party
from Paymentech, LLC and/or another affiliate of JPMCB, and any other Credit
Card Processor reasonably acceptable to the Administrative Agent in its
Permitted Discretion, in each case which have been earned by performance by such
Borrowing Base Party but not yet paid to such Borrowing Base Party by the Credit
Card Processor; provided, that Credit Card Receivables shall be calculated net
of fees and chargebacks owed to credit card processors and deposits, holdbacks
or escrows held by credit card processors.

“Credit Card Processor” means a Person that provides credit card processing
services for any merchant.

“Credit Party” means the Administrative Agent, the Issuing Bank, the Swingline
Lender or any other Lender.

“DDA Access Product” means the bank service provided to any Loan Party by JPMCB
in its sole discretion consisting of direct access to schedule payments from the
Funding Account by electronic, internet or other access mechanisms that may be
agreed upon from time to time by JPMCB and the funding of such payments under
the Loan Borrowing Option in the DDA Access Product Agreement.

“DDA Access Product Agreement” means JPMCB’s Treasury Services End of Day
Investment & Loan Sweep Service Terms, as in effect on the date of this
Agreement, as the same may be amended from time to time.

 

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“Debtor Relief Laws” means the Bankruptcy Code of the United States, the
Bankruptcy and Insolvency Act, R.S.C. 1985, c. B-3, the Companies’ Creditors
Arrangement Act, R.S.C. 1985, c. C-36, and all other liquidation,
conservatorship, bankruptcy, assignment for the benefit of creditors,
moratorium, rearrangement, receivership, insolvency, reorganization, or similar
debtor relief laws of the United States, Canada or other applicable
jurisdictions from time to time in effect and affecting the rights of creditors
generally.

“Default” means any event or condition which constitutes an Event of Default or
which upon notice, lapse of time or both would, unless cured or waived, become
an Event of Default.

“Default Right” has the meaning assigned to that term in, and shall be
interpreted in accordance with, 12 C.F.R. §§ 252.81, 47.2 or 382.1, as
applicable.

“Defaulting Lender” means any Lender that (a) has failed, within two Business
Days of the date required to be funded or paid, to (i) fund any portion of its
Loans, (ii) fund any portion of its participations in Letters of Credit or
Swingline Loans or (iii) pay over to any Credit Party any other amount required
to be paid by it hereunder, unless, in the case of clause (i) above, such Lender
notifies the Administrative Agent in writing that such failure is the result of
such Lender’s good faith determination that a condition precedent to funding
(specifically identified and including the particular Default, if any) has not
been satisfied; (b) has notified any Borrower or any Credit Party in writing, or
has made a public statement, to the effect that it does not intend or expect to
comply with any of its funding obligations under this Agreement (unless such
writing or public statement indicates that such position is based on such
Lender’s good faith determination that a condition precedent (specifically
identified and including the particular Default, if any) to funding a Loan under
this Agreement cannot be satisfied) or generally under other agreements in which
it commits to extend credit, (c) has failed, within three Business Days after
request by a Credit Party, acting in good faith, to provide a certification in
writing from an authorized officer of such Lender that it will comply with its
obligations (and is financially able to meet such obligations as of the date of
certification) to fund prospective Loans and participations in then outstanding
Letters of Credit and Swingline Loans under this Agreement, provided that such
Lender shall cease to be a Defaulting Lender pursuant to this clause (c) upon
such Credit Party’s receipt of such certification in form and substance
satisfactory to it and the Administrative Agent, or (d) has, or has a direct or
indirect parent company that has, after the date of this Agreement, become the
subject of (i) a Bankruptcy Event or (ii) a Bail-In Action.

“Disclosed Matters” means the actions, suits, proceedings and environmental
matters disclosed in Schedule 3.06.

“Disposition” or “Dispose” means the sale, transfer, license, lease or other
disposition (in one transaction or in a series of transactions and whether
effected pursuant to a Division or otherwise) of any property by any Person
(including any sale and leaseback transaction and any issuance of Equity
Interests by a Subsidiary of such Person), including any sale, assignment,
transfer or other disposal, with or without recourse, of any notes or accounts
receivable or any rights and claims associated therewith.

“Disqualified Equity Interests” means any Equity Interest that, by its terms (or
by the terms of any security or other Equity Interests into which it is
convertible or for which it is exchangeable), or upon the happening of any event
or condition (a) matures or is mandatorily redeemable (other than solely for
Qualified Equity Interests), pursuant to a sinking fund obligation or otherwise
(except as a result of a change of control or asset sale so long as any rights
of the holders thereof upon the occurrence of a change of control or asset sale
event shall be subject to prior Payment in Full), (b) is redeemable at the
option of the holder thereof (other than solely for Qualified Equity Interests
and other than as a result of a change of control or asset sale so long as any
rights of the holders thereof upon the occurrence of a change of control or
asset sale event shall be subject to the prior Payment in Full), in whole or in
part, (c) provides for the scheduled payments of dividends in cash, or (d) is or
becomes convertible into or

 

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exchangeable for Indebtedness or any other Equity Interests that would
constitute Disqualified Equity Interests, in each case, prior to the date that
is ninety-one (91) days after the Maturity Date; provided, that if such Equity
Interests are issued pursuant to a plan for the benefit of future, current or
former employees, directors, officers, members of management or consultants of
the Parent (or any direct or indirect parent thereof), the Borrowers or their
Subsidiaries or by any such plan to such employees, directors, officers, members
of management or consultants, such Equity Interests shall not constitute
Disqualified Equity Interests solely because they may be permitted to be
repurchased by the Parent, the Borrowers or their Subsidiaries in order to
satisfy applicable statutory or regulatory obligations or as a result of such
employee’s, director’s, officer’s, management member’s or consultant’s
termination of employment or service, as applicable, death or disability.

“Division” has the meaning assigned to such term in Section 1.08.

“Document” has the meaning assigned to such term in the in the U.S. Security
Agreement or the Canadian Security Agreement, as applicable.

“Dollar Equivalent” means for any amount, at the time of determination thereof,
(a) if such amount is expressed in Dollars, such amount, (b) if such amount is
expressed in Canadian Dollars, the equivalent of such amount in Dollars
determined by using the rate of exchange for the purchase of Dollars with
Canadian Dollars last provided (either by publication or otherwise provided to
the Administrative Agent) by the applicable Thompson Reuters Corp. (“Reuters”)
source on the Business Day (New York City time) immediately preceding the date
of determination or if such service ceases to be available or ceases to provide
a rate of exchange for the purchase of Dollars with Canadian Dollars, as
provided by such other publicly available information service which provides
that rate of exchange at such time in place of Reuters chosen by the
Administrative Agent in its sole discretion (or if such service ceases to be
available or ceases to provide such rate of exchange, the equivalent of such
amount in Dollars as determined by the Administrative Agent using any method of
determination it deems appropriate in its sole discretion) (the rate of exchange
set forth in this clause (b), the “Spot Rate”) and (c) if such amount is
denominated in any other currency, the equivalent of such amount in Dollars as
determined by the Administrative Agent using any method of determination it
deems appropriate in its sole discretion.

“dollars” or “$” refers to lawful money of the U.S.

“Domestic Subsidiary” means a Subsidiary organized under the laws of a
jurisdiction located in the U.S.

“EBITDA” means, for any period:

(a) Net Income for such period; plus

(b) without duplication and to the extent deducted in determining Net Income for
such period, the sum of:

(i) Interest Expense for such period;

(ii) income tax expense for such period;

(iii) all amounts attributable to depreciation and amortization expense for such
period (including, but not limited to, amortization of intangible assets and
properties and amortization and write-off of deferred financing fees);

 

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(iv) any non-recurring fees, expenses or charges (other than depreciation or
amortization expense) or gains or losses related to any offering of Equity
Interests of the Parent the proceeds of which are to be contributed to a
Borrower or any other Subsidiary, Investment permitted pursuant to Section 6.04,
asset acquisition, disposition, recapitalization or the incurrence of
Indebtedness permitted to be incurred hereunder (in each case, whether or not
consummated or incurred, as applicable), including, without limitation, any such
fees, expenses or charges related to (a) the Transactions, (b) the offering of
the Senior Secured Notes, (c) any amendment or other modification of this
Agreement or relevant documents relating to the Loans, the Senior Secured Notes,
the Convertible Notes or, in each case, any refinancing or refunding thereof and
(d) the payment or prepayment of any existing Indebtedness;

(v) unusual or non-recurring charges, severance costs, relocation costs,
integration and facilities’ pre-opening and opening costs, signing costs,
retention or completion bonuses, transition costs, costs related to
closure/consolidation of facilities, costs associated with tax projects/audits,
costs associated with any litigation settlement and costs consisting of
professional consulting or other fees relating to any of the foregoing; provided
that the aggregate amount added to Net Income pursuant to this clause (b)(v)
during the applicable period, when aggregated with the amount of any amount
added pursuant to clause (b)(vi) below and any adjustments made to EBITDA
pursuant to Section 1.06(d) for such period, shall not exceed fifteen percent
(15%) of EBITDA for the applicable period (calculated before giving effect to
any amounts added back in reliance on this clause (b)(v), clause (b)(vi) below
or any adjustments under Section 1.06(d));

(vi) the amount of any restructuring charges, accruals or reserves; provided
that the aggregate amount added to Net Income pursuant to this clause (b)(vi)
during the applicable period, when aggregated with the amount of any amount
added pursuant to clause (b)(v) above and any adjustments made to EBITDA
pursuant to Section 1.06(d) for such period, shall not exceed fifteen percent
(15%) of EBITDA for the applicable period (calculated before giving effect to
any amounts added back in reliance on this clause (b)(vi), clause (b)(v) above
or any adjustments under Section 1.06(d));

(vii) any costs or expenses pursuant to any management or employee stock option
or other equity-related plan, program or arrangement, or other benefit plan,
program or arrangement, or any stock subscription or shareholder agreement, to
the extent funded with cash proceeds contributed to the capital of such Person
or net cash proceeds of an issuance of Equity Interests of the Parent (other
than Disqualified Equity Interests);

(viii) any net loss for such period attributable to Swap Agreements or other
derivative instruments; and

(ix) all other non-cash charges, expenses or losses resulting from the
application of accounting adjustments, in each case reducing Net Income (other
than charges, expenses or losses resulting from accounting adjustments that will
require cash payments and for which an accrual or reserve is, or is required by
GAAP to be, made), as determined on a consolidated basis for such Person and its
Subsidiaries in conformity with GAAP, minus

(c) without duplication and to the extent included in Net Income,
(i) amortization of deferred airborne lease incentives; (ii) all non-cash
charges, expenses or gains resulting from the application of accounting
adjustments, in each case increasing Net Income (excluding any non-cash charges,
expenses or gains resulting from the application of accounting adjustments which
represent the reversal of any accrual of, or cash reserve for, anticipated cash
charges or asset valuation adjustments made in any prior period) as determined
on a consolidated basis for the Parent and its Subsidiaries in conformity with
GAAP; and (iii) any net gain for such period attributable to Swap Agreements or
other derivative instruments, all calculated for the Parent and its Subsidiaries
on a consolidated basis in accordance with GAAP.

 

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Notwithstanding anything to the contrary contained herein, for purposes of
determining EBITDA under this Agreement for any period that includes any of the
fiscal quarters ended September 30, 2018, December 31, 2018, March 31, 2019 and
June 30, 2019, EBITDA for such fiscal quarters shall be $21,058,000,
$19,388,000, $38,041,000 and $37,753,000 respectively, subject in each case to
any pro forma adjustments made in accordance with Section 1.06.

“ECP” means an “eligible contract participant” as defined in Section 1(a)(18) of
the Commodity Exchange Act or any regulations promulgated thereunder and the
applicable rules issued by the Commodity Futures Trading Commission and/or the
SEC.

“EEA Financial Institution” means (a) any institution established in any EEA
Member Country which is subject to the supervision of an EEA Resolution
Authority, (b) any entity established in an EEA Member Country which is a parent
of an institution described in clause (a) of this definition, or (c) any
institution established in an EEA Member Country which is a subsidiary of an
institution described in clauses (a) or (b) of this definition and is subject to
consolidated supervision with its parent.

“EEA Member Country” means any of the member states of the European Union,
Iceland, Liechtenstein, and Norway.

“EEA Resolution Authority” means any public administrative authority or any
Person entrusted with public administrative authority of any EEA Member Country
(including any delegee) having responsibility for the resolution of any EEA
Financial Institution.

“Effective Date” means the date on which the conditions specified in
Section 4.01 are satisfied (or waived in accordance with Section 9.02).

“Electronic Signature” means an electronic sound, symbol, or process attached
to, or associated with, a contract or other record and adopted by a Person with
the intent to sign, authenticate or accept such contract or record.

“Electronic System” means any electronic system, including e-mail, e-fax, web
portal access for such Borrower and any other Internet or extranet-based site,
whether such electronic system is owned, operated or hosted by the
Administrative Agent or any Issuing Bank and any of its respective Related
Parties or any other Person, providing for access to data protected by passcodes
or other security system.

“Eligible Accounts” means, at any time, the Accounts owing to either Borrower or
any other Borrowing Base Party; provided, that in no event shall an Account be
an Eligible Account if the Administrative Agent determines in its Permitted
Discretion that such Account:

(a) is not subject to a first priority perfected security interest in favor of
the Administrative Agent (subject to any Liens arising under clause (a) of the
definition of Permitted Encumbrances securing obligations in an aggregate amount
not to exceed 10% of the Borrowing Base; provided that the Administrative Agent
shall have implemented a Reserve in the amount of such obligations);

 

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(b) is subject to any Lien other than (i) a Lien in favor of the Administrative
Agent, (ii) a junior Lien in favor of the Senior Secured Notes Representative
securing the Senior Notes Obligations which is at all times subject to the terms
of the Senior Secured Notes Intercreditor Agreement, (iii) a junior Lien in
favor of any applicable representative for holders of Additional Secured
Indebtedness Obligations securing such Additional Secured Indebtedness
Obligations which is at all times subject to the terms of the applicable
Additional Indebtedness Intercreditor Agreement and (iv) a Permitted Encumbrance
which does not have priority over the Lien in favor of the Administrative Agent;

(c) (i) is unpaid more than ninety (90) days after the date of the original
invoice therefor or more than sixty (60) days after the original due date
therefor (“Overage”) (when calculating the amount under this clause (i), for the
same Account Debtor, the Administrative Agent shall include the net amount of
such Overage and add back any credits, but only to the extent that such credits
do not exceed the total gross receivables from such Account Debtor, or (ii) has
been written off the books of such Borrowing Base Party or otherwise designated
as uncollectible;

(d) is owing by an Account Debtor for which more than 50% of the Accounts owing
from such Account Debtor and its Affiliates are ineligible pursuant to clause
(c) above;

(e) is owing by an Account Debtor to the extent the aggregate amount of Accounts
owing from such Account Debtor and its Affiliates to all Borrowing Base Parties
exceeds (i) 60% (or such higher percentage agreed to by the Required Lenders) of
the aggregate amount of Eligible Accounts of all Borrowing Base Parties in the
case of Delta Air Lines Inc. or (ii) 25% (or such higher percentage agreed to by
the Required Lenders) of the aggregate amount of Eligible Accounts of all
Borrowing Base Parties in the case of any Account Debtor other than Delta Air
Lines Inc., in each case, to the extent of the obligations owing by such Account
Debtor in excess of such percentages;

(f) with respect to which any covenant, representation or warranty contained in
this Agreement, the U.S. Security Agreement or the Canadian Security Agreement
has been breached or is not true in any material respect;

(g) which (i) does not arise from the sale of goods or performance of services
in the ordinary course of business, (ii) is not evidenced by an invoice or other
documentation reasonably satisfactory to the Administrative Agent which has been
sent to the Account Debtor, (iii) represents a progress billing, (iv) is
contingent upon such Borrowing Base Party’s completion of any further
performance, (v) represents a sale on a bill-and-hold, guaranteed sale,
sale-and-return, sale on approval, consignment, cash-on-delivery or any other
repurchase or return basis or (vi) relates to payments of interest; provided,
however, that Unbilled Accounts shall constitute Eligible Accounts if they are
not ineligible pursuant to another clause of this definition and:

(x) the applicable Borrowing Base Party has recognized the associated revenue
for such Account in accordance with GAAP with respect to a completed task order;
and

(y) less than thirty (30) days have passed since the date that such Borrowing
Base Party recognized the associated revenue for such Account in accordance with
GAAP with respect to the applicable completed task order, or less than
forty-five (45) days solely in the case of an Account arising under a contract
(i) that has expired by its terms, (ii) which the applicable Borrowing Base
Party in good faith expects to be renewed and is engaged in active negotiations
with the applicable Account Debtor for such renewal and (iii) under which
services continue to be provided by the applicable Borrowing Base Party pending
such anticipated renewal;

 

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(h) for which the goods giving rise to such Account have not been shipped to the
Account Debtor or for which the services giving rise to such Account have not
been performed by such Borrowing Base Party or if such Account was invoiced more
than once;

(i) with respect to which any check or other instrument of payment has been
returned uncollected for any reason;

(j) which is owed by an Account Debtor which has (i) applied for, suffered, or
consented to the appointment of any receiver, monitor, custodian, trustee, or
liquidator of its assets, (ii) had possession of all or a material part of its
property taken by any receiver, custodian, trustee or liquidator, (iii) filed,
or had filed against it, any assignment, application, request or petition for
liquidation, reorganization, compromise, arrangement, application, adjustment of
debts, stay of proceedings, adjudication as bankrupt, winding-up, or voluntary
or involuntary case or proceeding under any Debtor Relief Laws (other than
post-petition accounts payable of an Account Debtor that is a
debtor-in-possession under the Bankruptcy Code and reasonably acceptable to the
Administrative Agent), (iv) admitted in writing its inability, or is generally
unable to, pay its debts as they become due (provided, that, to the extent such
inability to pay applies to only a portion of the Account, only such portion
shall be excluded from this definition), (v) become insolvent, or (vi) ceased
operation of its business, unless, in the case of clauses (j)(i) through (j)(vi)
above, such Account Debtor has caused the issuance of a letter of credit in
favor of the applicable Borrowing Base Party fully securing the payment of such
Account, which letter of credit is reasonably satisfactory to the Administrative
Agent, and is in the possession of, and is directly drawable by, the
Administrative Agent;

(k) which is owed by any Account Debtor which has sold all or substantially all
of its assets;

(l) which is owed by an Account Debtor which (i) does not maintain its chief
executive office in the U.S. (including any territory thereof) or Canada or
(ii) is not organized under applicable law of the U.S., any state of the U.S.,
or the District of Columbia, Canada, or any province or territory of Canada
unless, in any such case, such Account is backed by a Letter of Credit
acceptable to the Administrative Agent which is in the possession of, and is
directly drawable by, the Administrative Agent;

(m) which is owed in any currency other than U.S. dollars or Canadian Dollars;

(n) which is owed by (i) any government (or any department, agency, public
corporation, or instrumentality thereof) of any country other than the U.S.
unless such Account is backed by a Letter of Credit acceptable to the
Administrative Agent which is in the possession of, and is directly drawable by,
the Administrative Agent, or (ii) any government of the U.S., or any department,
agency, public corporation, or instrumentality thereof, unless the Federal
Assignment of Claims Act of 1940, as amended (31 U.S.C. § 3727 et seq. and 41
U.S.C. § 15 et seq.), and any other steps necessary to perfect the Lien of the
Administrative Agent in such Account have been complied with to the
Administrative Agent’s satisfaction (iii) any Governmental Authority of Canada,
or any province, territory, department, agency, public corporation, or
instrumentality thereof, unless the Financial Administration Act, R.S.C. 1985,
C. F-11 or any other legislation of similar purpose and effect restricting the
assignment of such Account and any other steps necessary to perfect the Lien of
the Administrative Agent in such Account, have been complied with to the
Administrative Agent’s satisfaction;

 

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(o) which is owed by any Affiliate of any Borrowing Base Party or any employee,
officer, director, agent or stockholder of any Borrowing Base Party or any of
its Affiliates;

(p) which is a Credit Card Receivable;

(q) which is owed by an Account Debtor or any Affiliate of such Account Debtor
to which such Borrowing Base Party is indebted, but only to the extent of such
indebtedness, or is subject to any security, deposit, progress payment,
retainage or other similar advance made by or for the benefit of an Account
Debtor, in each case to the extent thereof;

(r) which is subject to any counterclaim, contra account, deduction, defense,
setoff or dispute but only to the extent of any such counterclaim, contra
account, deduction, defense, setoff or dispute, without duplication with any
Reserves;

(s) which is evidenced by “chattel paper” or an “instrument” (each as defined in
the UCC or the PPSA, as applicable) of any kind unless such “chattel paper” or
“instrument” is in the possession of the Administrative Agent, and to the extent
necessary or appropriate, endorsed to the Administrative Agent;

(t) which is owed by an Account Debtor (i) located in any jurisdiction which
requires filing of a “Notice of Business Activities Report” or other similar
report in order to permit such Borrowing Base Party to seek judicial enforcement
in such jurisdiction of payment of such Account, unless such Borrowing Base
Party has filed such report or qualified to do business in such jurisdiction or
(ii) which is a Sanctioned Person;

(u) with respect to which such Borrowing Base Party has made any agreement with
the Account Debtor for any reduction thereof, other than discounts and
adjustments given in the ordinary course of business (but only to the extent of
any such reduction) or any Account which was partially paid and such Borrowing
Base Party created a new receivable for the unpaid portion of such Account;

(v) which does not comply in all material respects with the requirements of all
applicable laws and regulations, whether Federal, state or local, including
without limitation the Federal Consumer Credit Protection Act, the Federal Truth
in Lending Act and Regulation Z of the Board;

(w) which is for goods that have been sold under a purchase order or pursuant to
the terms of a contract or other agreement or understanding (written or oral)
that indicates or purports that any Person other than such Borrowing Base Party
has or has had an ownership interest in such goods, or which indicates any party
other than such Borrowing Base Party as payee or remittance party;

(x) which was created on cash on delivery terms; or

(y) which is subject to any limitation on assignment or other restriction
(whether arising by operation of law, by agreement or otherwise) which would
under the local governing law of the contract have the effect of restricting the
assignment for or by way of security or the creation of security, in each case,
unless the Administrative Agent has determined that such limitation is not
enforceable.

 

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In the event that an Account of a Borrowing Base Party which was previously an
Eligible Account ceases to be an Eligible Account hereunder, such Borrowing Base
Party or the Borrower Representative shall notify the Administrative Agent
thereof on and at the time of submission to the Administrative Agent of the next
Borrowing Base Certificate. In determining the amount of an Eligible Account of
a Borrowing Base Party, the face amount of an Account may, in the Administrative
Agent’s Permitted Discretion, be reduced by, without duplication, to the extent
not reflected in such face amount, (i) the amount of all accrued and actual
discounts, claims, credits or credits pending, promotional program allowances,
price adjustments, finance charges or other allowances (including any amount
that such Borrowing Base Party may be obligated to rebate to an Account Debtor
pursuant to the terms of any agreement or understanding (written or oral)) and
(ii) the aggregate amount of all cash received in respect of such Account but
not yet applied by such Borrowing Base Party to reduce the amount of such
Account.

Notwithstanding the foregoing, the establishment or adjustment of any Reserve
shall be carried out in a manner consistent with the provisions of the
definition of “Borrowing Base”.

“Eligible Credit Card Receivables” means Credit Card Receivables that (i) have
been earned by performance and represent the bona fide amounts due to a
Borrowing Base Party from a Credit Card Processor, and in each case originated
in the ordinary course of business of the applicable Borrowing Base Party and
(ii) are not excluded as Eligible Credit Card Receivables pursuant to any of the
following clauses. Without limiting the foregoing, to qualify as an Eligible
Credit Card Receivable, a Credit Card Receivable shall indicate no Person other
than a Borrowing Base Party as payee or remittance party. Eligible Credit Card
Receivable shall not include any Credit Card Receivable if:

(a) such Credit Card Receivable is not owned by a Borrowing Base Party and such
Borrowing Base Party does not have good or marketable title to such Credit Card
Receivable;

(b) such Credit Card Receivable constitutes neither an “account” (as defined in
the UCC or the PPSA, as applicable) nor a “payment intangible” (as defined in
the UCC or PPSA, as applicable), or such Credit Card Receivable has been
outstanding more than five (5) Business Days;

(c) the Credit Card Processor of the applicable credit card with respect to such
Credit Card Receivable is the subject of any bankruptcy or insolvency
proceedings;

(d) such Credit Card Receivable is not a valid, legally enforceable obligation
of the applicable credit card issuer with respect thereto;

(e) such Credit Card Receivable is not subject to a properly perfected first
priority security interest in favor of the Administrative Agent;

(f) such Credit Card Receivable is subject to any Lien other than (i) a Lien in
favor of the Administrative Agent, (ii) a junior Lien in favor of the Senior
Secured Notes Representative securing the Senior Notes Obligations which is at
all times subject to the terms of the Senior Secured Notes Intercreditor
Agreement, (iii) a junior Lien in favor of any applicable representative for
holders of Additional Secured Indebtedness Obligations securing such Additional
Secured Indebtedness Obligations which is at all times subject to the terms of
the applicable Additional Indebtedness Intercreditor Agreement and (iv) a
Permitted Encumbrance which does not have priority over the Lien in favor of the
Administrative Agent;

 

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(f) such Credit Card Receivable does not conform in all material respects to all
representations, warranties or other provisions in the Loan Documents or in the
credit card agreements relating to such Credit Card Receivable;

(g) such Credit Card Receivable is subject to risk of setoff, non-collection or
not being processed due to unpaid or overdue Credit Card Processor fee balances;

(h) such Credit Card Receivable is evidenced by “chattel paper” or an
“instrument” of (each as defined in the UCC or the PPSA, as applicable) any kind
unless such “chattel paper” or “instrument” is in the possession of the
Administrative Agent, and to the extent necessary or appropriate, endorsed to
the Administrative Agent;

(i) such Credit Card Receivable has been disputed, or with respect to which a
claim, counterclaim, offset or chargeback has been asserted, by the related
Credit Card Processor (but only to the extent of such claim, counterclaim,
offset or chargeback);

(j) from and after the date which is thirty (30) days after the Effective Date
(or such later date as may be agreed to by the Administrative Agent in its
Permitted Discretion), such Credit Card Receivable is due from a Credit Card
Processor with respect to which a Processor Control Agreement has not been
obtained; or

(k) such Credit Card Receivable is due from a Credit Card Processor which is a
Sanctioned Person.

In determining the amount to be so included in the calculation of the value of
an Eligible Credit Card Receivable, the face amount thereof shall be reduced by,
without duplication, to the extent not reflected in such face amount, (i) the
amount of all customary fees and expenses in connection with any credit card
arrangements and (ii) the aggregate amount of all cash received in respect
thereof but not yet applied by the applicable Borrowing Base Party to reduce the
amount of such Eligible Credit Card Receivable.

“Environmental Laws” means all laws, rules, regulations, codes, ordinances,
orders, decrees, judgments, injunctions, notices or binding agreements issued,
promulgated or entered into by any Governmental Authority, relating in any way
to (a) the environment, (b) preservation or reclamation of natural resources,
(c) the management, Release or threatened Release of any Hazardous Material or
(d) health and safety matters.

“Environmental Liability” means any liability, contingent or otherwise
(including any liability for damages, costs of environmental remediation, fines,
penalties or indemnities), of the Parent or any Subsidiary directly or
indirectly resulting from or based upon (a) any violation of any Environmental
Law, (b) the generation, use, handling, transportation, storage, treatment or
disposal of any Hazardous Materials, (c) any exposure to any Hazardous
Materials, (d) the Release or threatened Release of any Hazardous Materials into
the environment or (e) any contract, agreement or other consensual arrangement
pursuant to which liability is assumed or imposed with respect to any of the
foregoing.

“Equity Interests” means shares of capital stock, partnership interests,
membership interests in a limited liability company, beneficial interests in a
trust or other equity ownership interests in a Person, and any warrants, options
or other rights entitling the holder thereof to purchase or acquire any of the
foregoing, but excluding any debt securities convertible into any of the
foregoing.

 

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“ERISA” means the Employee Retirement Income Security Act of 1974, as amended
from time to time, and the rules and regulations promulgated thereunder.

“ERISA Affiliate” means any trade or business (whether or not incorporated)
that, together with the Parent or any Borrower, is treated as a single employer
under Section 414(b) or (c) of the Code or Section 4001(14) of ERISA or, solely
for purposes of Section 302 of ERISA and Section 412 of the Code, is treated as
a single employer under Section 414 of the Code.

“ERISA Event” means (a) any “reportable event”, as defined in Section 4043 of
ERISA or the regulations issued thereunder, with respect to a Plan (other than
an event for which the 30-day notice period is waived); (b) the failure to
satisfy the “minimum funding standard” (as defined in Section 412 of the Code or
Section 302 of ERISA), whether or not waived; (c) the filing pursuant to
Section 412(c) of the Code or Section 302(c) of ERISA of an application for a
waiver of the minimum funding standard with respect to any Plan; (d) the
incurrence by any Borrower or any ERISA Affiliate of any liability under Title
IV of ERISA with respect to the termination of any Plan; (e) the receipt by any
Borrower or any ERISA Affiliate from the PBGC or a plan administrator of any
notice relating to an intention to terminate any Plan or Plans or to appoint a
trustee to administer any Plan; (f) the incurrence by any Borrower or any ERISA
Affiliate of any liability with respect to the withdrawal or partial withdrawal
of any Borrower or any ERISA Affiliate from any Plan or Multiemployer Plan; or
(g) the receipt by any Borrower or any ERISA Affiliate of any notice, or the
receipt by any Multiemployer Plan from any Borrower or any ERISA Affiliate of
any notice, concerning the imposition upon any Borrower or any ERISA Affiliate
of Withdrawal Liability or a determination that a Multiemployer Plan is, or is
expected to be, insolvent or in critical status, within the meaning of Title IV
of ERISA.

“EU Bail-In Legislation Schedule” means the EU Bail-In Legislation Schedule
published by the Loan Market Association (or any successor Person), as in effect
from time to time.

“Eurodollar”, when used in reference to any Loan or Borrowing, refers to whether
such Loan, or the Loans comprising such Borrowing, bears interest at a rate
determined by reference to the Adjusted LIBO Rate.

“Event of Default” has the meaning assigned to such term in Article VII.

“Excluded Assets” has the meaning assigned to such term in the in the U.S.
Security Agreement or the Canadian Security Agreement, as applicable.

“Excluded Subsidiary” means, except as provided in Section 5.13(d), (i) any
Foreign Subsidiary on or before the first anniversary of the acquisition of such
Foreign Subsidiary and (ii) any Foreign Subsidiary, Subsidiary of a Foreign
Subsidiary or Foreign Subsidiary Holdco, in each case, to the extent (x) such
Subsidiary acting as a Loan Party is not practicable (including as a result of
local law in the jurisdiction in which such Subsidiary is organized or other
applicable law, rule or regulation), (y) the burden or cost of providing a
Guarantee therefrom outweigh the benefit of the guaranty or (z) such Subsidiary
acting as a Loan Party would cause materially adverse tax consequences to the
Parent and its Subsidiaries, in each case of clauses (x), (y) and (z) above, as
determined by the Parent in good faith.

“Excluded Swap Obligation” means, with respect to any Loan Guarantor, any Swap
Obligation if, and to the extent that, all or a portion of the Guarantee of such
Loan Guarantor of, or the grant by such Loan Guarantor of a security interest to
secure, such Swap Obligation (or any Guarantee thereof) is or becomes illegal
under the Commodity Exchange Act or any rule, regulation or order of the
Commodity Futures Trading Commission (or the application or official
interpretation of any thereof) by virtue of such Loan Guarantor’s failure for
any reason to constitute an ECP at the time the Guarantee of such Loan

 

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Guarantor or the grant of such security interest becomes or would become
effective with respect to such Swap Obligation. If a Swap Obligation arises
under a master agreement governing more than one swap, such exclusion shall
apply only to the portion of such Swap Obligation that is attributable to swaps
for which such Guarantee or security interest is or becomes illegal.

“Excluded Taxes” means any of the following Taxes imposed on or with respect to
a Recipient or required to be withheld or deducted from a payment to a
Recipient: (a) Taxes imposed on or measured by net income (however denominated),
franchise Taxes, and branch profits Taxes, in each case, (i) imposed as a result
of such Recipient being organized under the laws of, or having its principal
office or, in the case of any Lender, its applicable lending office located in,
the jurisdiction imposing such Tax (or any political subdivision thereof) or
(ii) that are Other Connection Taxes; (b) in the case of a Lender, U.S. Federal
withholding Taxes imposed on amounts payable to or for the account of such
Lender with respect to an applicable interest in a Loan, Letter of Credit or
Commitment pursuant to a law in effect on the date on which (i) such Lender
acquires such interest in the Loan, Letter of Credit or Commitment (other than
pursuant to an assignment request by the Borrowers under Section 2.19(b)) or
(ii) such Lender changes its lending office, except in each case to the extent
that, pursuant to Section 2.17, amounts with respect to such Taxes were payable
either to such Lender’s assignor immediately before such Lender acquired the
applicable interest in a Loan, Letter of Credit or Commitment or to such Lender
immediately before it changed its lending office; (c) Taxes attributable to such
Recipient’s failure to comply with Section 2.17(f); and (d) any withholding
Taxes imposed under FATCA.

“Extenuating Circumstance” means any period during which the Administrative
Agent has determined in its sole discretion (a) that due to unforeseen and/or
nonrecurring circumstances, it is impractical and/or not feasible to submit or
receive a Borrowing Request or Interest Election Request by email or fax or
through Electronic System, and (b) to accept a Borrowing Request or Interest
Election Request telephonically.

“FAA” means the Federal Aviation Administration, and any successor agency of the
United States government exercising substantially equivalent powers.

“FAA Approval” means any governmental certification, authorization or approval
granted by the FAA, or by any other Governmental Authority pursuant to
applicable law, to any Loan Party, or assigned or transferred to any Loan Party
pursuant to applicable law.

“FATCA” means Sections 1471 through 1474 of the Code, as of the date of this
Agreement (or any amended or successor version that is substantively comparable
and not materially more onerous to comply with), any current or future
regulations or official interpretations thereof and any agreement entered into
pursuant to Section 1471(b)(1) of the Code, any intergovernmental agreement
entered into in connection with any of the foregoing and any fiscal or
regulatory legislation, rules or practices adopted pursuant to any
intergovernmental agreement, treaty or convention among Governmental Authorities
and implementing such Sections of the Code.

“FCC” means the Federal Communications Commission, and any successor agency of
the United States government exercising substantially equivalent powers.

“FCC License” means any governmental authorization granted by the FCC pursuant
to the Communications Act, or by any other Governmental Authority pursuant to
Communications Laws, to any Loan Party or assigned or transferred to any Loan
Party pursuant to Communications Laws.

“FCC License Holder” means (a) as of the Effective Date, AC BidCo LLC and
(b) after the Effective Date, any Subsidiary that the Parent designates to hold
FCC Licenses.

 

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“Federal Funds Effective Rate” means, for any day, the rate calculated by the
NYFRB based on such day’s federal funds transactions by depositary institutions
(as determined in such manner as the NYFRB shall set forth on its public website
from time to time) and published on the next succeeding Business Day by the
NYFRB as the effective federal funds rate, provided that, if the Federal Funds
Effective Rate as so determined would be less than zero, such rate shall be
deemed to be zero for the purposes of this Agreement.

“Federal Reserve Board” means the Board of Governors of the Federal Reserve
System of the United States of America.

“Financial Officer” means the chief financial officer, principal accounting
officer, treasurer or controller of the Parent or a Borrower, as the context may
require, it being understood that any such Person shall have been identified on
a properly completed Appointment of Designated Authority Letter that has been
executed and delivered to the Administrative Agent.

“Fixed Charge Coverage Ratio” means, for any period, the ratio of (a) EBITDA
minus Unfinanced Capital Expenditures minus expenditures for any purchase or
other acquisition of any equipment of a type which the Parent or any of its
Subsidiaries, as applicable, has elected to reclassify as inventory minus
expenses for taxes paid in cash to (b) Fixed Charges, all calculated for the
period of twelve consecutive calendar months ended on such date (or, if such
date is not the last day of a calendar month, ended on the last day of the
calendar month most recently ended prior to such date).

“Fixed Charges” means, for any period, without duplication, cash Interest
Expense, plus scheduled principal payments on Indebtedness actually made on
account of Indebtedness for borrowed money (excluding the Obligations), plus
Capital Lease Obligation payments, all calculated for the Parent and its
Subsidiaries on a consolidated basis in accordance with GAAP. Any Restricted
Payment made pursuant to Section 6.08(a)(iii) or any payment or other
distribution on account of the purchase, redemption, retirement, acquisition,
cancellation or termination of any Indebtedness pursuant to Section 6.08(b)(v),
in either case during the applicable period, will also be included as “Fixed
Charges” for purposes of the pro forma calculation of the Fixed Charge Coverage
Ratio set forth in clause (b)(B) of the definition of “Payment Conditions” for
purposes of determining whether Payment Conditions have been satisfied under
such Sections.

“Flood Laws” has the meaning assigned to such term in Section 8.10.

“Foreign Lender” means a Lender that is not a U.S. Person.

“Foreign Subsidiary” means any Subsidiary which is not a Domestic Subsidiary.

“Foreign Subsidiary Holdco” means any Domestic Subsidiary with all or
substantially all of the assets of such Subsidiary consisting of equity or debt
of one of more Foreign Subsidiaries, intellectual property relating to such
Subsidiaries and other assets (including cash or cash equivalents) relating to
an ownership interest in such Subsidiaries.

“Funding Account” has the meaning assigned to such term in Section 4.01(h).

“GAAP” means generally accepted accounting principles in the U.S.

“Governmental Authority” means the government of the U.S., Canada, any other
nation or any political subdivision thereof, whether state, provincial,
territorial, municipal or local, and any agency, authority, instrumentality,
regulatory body, court, central bank or other entity exercising executive,
legislative, judicial, taxing, regulatory or administrative powers or functions
of or pertaining to government.

 

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“Gogo Canada” means Gogo Connectivity Ltd., a British Columbia company.

“Guarantee” of or by any Person (the “guarantor”) means any obligation,
contingent or otherwise, of the guarantor guaranteeing or having the economic
effect of guaranteeing any Indebtedness or other obligation of any other Person
(the “primary obligor”) in any manner, whether directly or indirectly, and
including any obligation of the guarantor, direct or indirect, (a) to purchase
or pay (or advance or supply funds for the purchase or payment of) such
Indebtedness or other obligation or to purchase (or to advance or supply funds
for the purchase of) any security for the payment thereof, (b) to purchase or
lease property, securities or services for the purpose of assuring the owner of
such Indebtedness or other obligation of the payment thereof, (c) to maintain
working capital, equity capital or any other financial statement condition or
liquidity of the primary obligor so as to enable the primary obligor to pay such
Indebtedness or other obligation or (d) as an account party in respect of any
letter of credit or letter of guaranty issued to support such Indebtedness or
obligation; provided, that the term Guarantee shall not include endorsements for
collection or deposit in the ordinary course of business.

“Guaranteed Obligations” has the meaning assigned to such term in Section 10.01.

“Hazardous Materials” means (a) any substance, material, or waste that is
included within the definitions of “hazardous substances,” “hazardous
materials,” “hazardous waste,” “toxic substances,” “toxic materials,” “toxic
waste,” or words of similar import in any Environmental Law; (b) those
substances listed as hazardous substances by the United States Department of
Transportation (and any similar or equivalent agency in Canada or any successor
agency) (49 C.F.R. 172.101 and amendments thereto) or by the Environmental
Protection Agency (and any similar or equivalent agency in Canada or any
successor agency) (40 C.F.R. Part 302 and amendments thereto); and (c) any
substance, material, or waste that is petroleum, petroleum-related, or a
petroleum by-product, asbestos or asbestos-containing material, polychlorinated
biphenyls, flammable, explosive, radioactive, Freon gas, radon, or a pesticide,
herbicide, or any other agricultural chemical.

“IBA” has the meaning assigned to such term in Section 1.05.

“Impacted Interest Period” has the meaning assigned to such term in the
definition of “LIBO Rate”.

“Indebtedness” of any Person means, without duplication, (a) all obligations of
such Person for borrowed money or with respect to deposits or advances of any
kind, (b) all obligations of such Person evidenced by bonds, debentures, notes
or similar instruments, (c) all obligations of such Person upon which interest
charges are customarily paid, (d) all obligations of such Person under
conditional sale or other title retention agreements relating to property
acquired by such Person, (e) all obligations of such Person in respect of the
deferred purchase price of property or services (excluding (i) trade accounts
and accrued expenses payable to trade creditors in the ordinary course of
business, (ii) any earn-out or similar obligation, unless such obligation has
not been paid within thirty (30) days after becoming due and payable and
(iii) accruals for payroll and other liabilities accrued in the ordinary course
of business), (f) all Indebtedness of others secured by (or for which the holder
of such Indebtedness has an existing right, contingent or otherwise, to be
secured by) any Lien on property owned or acquired by such Person, whether or
not the Indebtedness secured thereby has been assumed, (g) all Guarantees by
such Person of Indebtedness of others, (h) all Capital Lease Obligations of such
Person, (i) all obligations, contingent or otherwise, of such Person as an
account party in respect of letters of credit and letters of guaranty, (j) all
obligations, contingent or otherwise, of such Person in respect of bankers’
acceptances, (k) any other Off-

 

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Balance Sheet Liability, (m) net obligations under any and all Swap Agreements,
and (n) Disqualified Equity Interests. The Indebtedness of any Person shall
include the Indebtedness of any other entity (including any partnership in which
such Person is a general partner) to the extent such Person is liable therefor
as a result of such Person’s ownership interest in or other relationship with
such entity, except to the extent the terms of such Indebtedness provide that
such Person is not liable therefor. The amount of any net obligation under any
Swap Agreement on any date shall be deemed to be the Swap Termination Value
thereof as of such date. The amount of Indebtedness of any Person for purposes
of clause (f) shall be deemed to be equal to the lesser of (i) the aggregate
unpaid amount of such Indebtedness and (ii) the fair market value of the
property encumbered thereby.

“Indemnified Taxes” means (a) Taxes, other than Excluded Taxes, imposed on or
with respect to any payment made by, or on account of any obligation of any Loan
Party under any Loan Document and (b) to the extent not otherwise described in
the foregoing clause (a) hereof, Other Taxes.

“Indemnitee” has the meaning assigned to such term in Section 9.03(b).

“Ineligible Institution” has the meaning assigned to such term in
Section 9.04(b).

“Information” has the meaning assigned to such term in Section 9.12.

“Intercompany Note” means a promissory note substantially in the form of Exhibit
H.

“Intercreditor Agreement” means (i) the Senior Secured Notes Intercreditor
Agreement or (ii) any Additional Secured Indebtedness Intercreditor Agreement.

“Interest Election Request” means a request by the Borrower Representative to
convert or continue a Revolving Borrowing in accordance with Section 2.08.

“Interest Expense” means, for any period, the sum, without duplication of
(a) the aggregate amount of interest in respect of Indebtedness of the Parent
and its Subsidiaries for such period, to the extent deducted in calculating Net
Income for such period (including, without limitation, (i) amortization or
accretion of original issue discount on any Indebtedness; (ii) the interest
component of Capital Lease Obligations; (iii) non-cash interest payments;
(iv) the interest portion of any deferred payment obligation, calculated in
accordance with the effective interest method of accounting; (v) commissions,
discounts and other fees and charges owed with respect to letters of credit and
bankers’ acceptance financing; (vi) the net costs associated with interest rate
Swap Agreements; and (vii) interest on Indebtedness that is guaranteed or
secured by the Parent or any of its Subsidiaries, but only to the extent that
such interest is actually paid by such person), and all imputed interest with
respect to Attributable Debt, in each case that is paid, accrued or scheduled to
be paid or to be accrued by the Parent and its Subsidiaries during such period;
plus (b) consolidated capitalized interest of the Parent and its Subsidiaries
for such period, whether paid or accrued; less (c) interest income of the Parent
and its Subsidiaries for such period; excluding, however, amortization of
deferred financing fees, debt issuance costs, commissions, fees and expenses,
expensing of any bridge, commitment or other financing fees, penalties and
interest relating to taxes and any “special interest” or “additional interest”
with respect to securities, and any accretion of accrued interest on discounted
liabilities.

“Interest Payment Date” means (a) with respect to any ABR Loan (other than a
Swingline Loan), the first Business Day of each calendar month and the Maturity
Date, (b) with respect to any Eurodollar Loan, the last day of each Interest
Period applicable to the Borrowing of which such Loan is a part (and, in the
case of a Eurodollar Borrowing with an Interest Period of more than three
months’ duration, each day prior to the last day of such Interest Period that
occurs at intervals of three months’ duration after the first day of such
Interest Period) and the Maturity Date and (c) with respect to any Swingline
Loan, the day that such Loan is required to be repaid.

 

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“Interest Period” means, with respect to any Eurodollar Borrowing, the period
commencing on the date of such Eurodollar Borrowing and ending on the
numerically corresponding day in the calendar month that is one, two, three or
six months thereafter (or twelve months or less than one month if each affected
Lender consents), as the Borrower Representative may elect; provided, that
(a) if any Interest Period would end on a day other than a Business Day, such
Interest Period shall be extended to the next succeeding Business Day unless,
such next succeeding Business Day would fall in the next calendar month, in
which case such Interest Period shall end on the next preceding Business Day and
(b) any Interest Period that commences on the last Business Day of a calendar
month (or on a day for which there is no numerically corresponding day in the
last calendar month of such Interest Period) shall end on the last Business Day
of the last calendar month of such Interest Period. For purposes hereof, the
date of a Borrowing initially shall be the date on which such Borrowing is made
and thereafter shall be the effective date of the most recent conversion or
continuation of such Borrowing.

“Internally Generated Cash” means, with respect to any Person, funds of such
Person and its Subsidiaries not constituting (x) proceeds of the issuance of (or
contributions in respect of) Equity Interests of such Person, (y) proceeds of
the incurrence of Indebtedness (other than the incurrence of Loans or extensions
of credit under any other revolving credit or similar facility) by such Person
or any of its Subsidiaries or (z) proceeds of Dispositions (other than
Dispositions of inventory in the ordinary course of business) and events that
gives rise to the receipt by the Parent or any Subsidiary of any insurance
proceeds or condemnation awards in respect of any equipment, fixed assets or
real property (including any improvements thereon) to replace or repair such
equipment, fixed assets or real property.

“Interpolated Rate” means, at any time, for any Interest Period, the rate per
annum (rounded to the same number of decimal places as the LIBO Screen Rate)
determined by the Administrative Agent (which determination shall be conclusive
and binding absent manifest error) to be equal to the rate that results from
interpolating on a linear basis between: (a) the LIBO Screen Rate for the
longest period (for which the LIBO Screen Rate is available) that is shorter
than the Impacted Interest Period and (b) the LIBO Screen Rate for the shortest
period (for which the LIBO Screen Rate is available) that exceeds the Impacted
Interest Period, in each case, at such time; provided, that if any Interpolated
Rate shall be less than zero, such rate shall be deemed to be zero for purposes
of this Agreement.

“Investment” has the meaning set forth in Section 6.04.

“IP Reorganization Transaction” means (a) the sale or transfer of intellectual
property assets and/or the rights to use such intellectual property assets, by
any Loan Party to a Subsidiary organized under the laws of Switzerland whose
Equity Interests may only be held entirely by a Subsidiary (i) whose Equity
Interests may only be held entirely by a Loan Party (other than the Parent) and
(ii) which has no Indebtedness outstanding owed to any Person other than a Loan
Party (other than the Parent) and (b) any related transactions; provided that,
if such transactions result in a license in favor of any Loan Party to use such
intellectual property assets, the rights of such Loan Party under such license
shall be pledged to the Administrative Agent as Collateral securing the Secured
Obligations; provided further that the Subsidiary to which such intellectual
property assets and/or rights to use such intellectual property assets are sold
or transferred shall not (x) engage in any material business activities other
than in connection with, incidental to, or in support of the acquisition,
development, exploitation, commercialization or licensing of intellectual
property assets and/or rights to use such intellectual property assets (“IP
Entity Permitted Activities”) or (y) incur Indebtedness owed to any party other
than a Loan Party (other than the Parent) (other than (1) accounts payable or
any other Indebtedness or monetary obligation to trade creditors created,
assumed or guaranteed by such Person or any of its Subsidiaries arising in the
ordinary course of business in connection with the acquisition of goods or
services, and (2) other Indebtedness incurred in the ordinary course and in
connection with, incidental to, or in support of IP Entity Permitted Activities)
or issue Equity Interests, other than in favor of or to a Loan Party (other than
the Parent).

 

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“IRS” means the United States Internal Revenue Service.

“Issuing Bank” means, individually and collectively, each of JPMCB, in its
capacity as the issuer of Letters of Credit hereunder, and any other Revolving
Lender from time to time designated by the Borrower Representative as an Issuing
Bank, with the consent of such Revolving Lender and the Administrative Agent,
and their respective successors in such capacity as provided in Section 2.06(i).
Any Issuing Bank may, in its discretion, arrange for one or more Letters of
Credit to be issued by its Affiliates, in which case the term “Issuing Bank”
shall include any such Affiliate with respect to Letters of Credit issued by
such Affiliate (it being agreed that such Issuing Bank shall, or shall cause
such Affiliate to, comply with the requirements of Section 2.06 with respect to
such Letters of Credit). At any time there is more than one Issuing Bank, all
singular references to the Issuing Bank shall mean any Issuing Bank, either
Issuing Bank, each Issuing Bank, the Issuing Bank that has issued the applicable
Letter of Credit, or both (or all) Issuing Banks, as the context may require.

“Joinder Agreement” means a Joinder Agreement in substantially the form of
Exhibit E.

“JPMCB” means JPMorgan Chase Bank, N.A., a national banking association, in its
individual capacity, and its successors.

“LC Collateral Account” has the meaning assigned to such term in
Section 2.06(j).

“LC Disbursement” means any payment made by an Issuing Bank pursuant to a Letter
of Credit.

“LC Exposure” means, at any time, the sum of the Commercial LC Exposure and the
Standby LC Exposure at such time. The LC Exposure of any Revolving Lender at any
time shall be its Applicable Percentage of the aggregate LC Exposure at such
time.

“Lender Parent” means, with respect to any Lender, any Person as to which such
Lender is, directly or indirectly, a subsidiary.

“Lenders” means the Persons listed on the Commitment Schedule and any other
Person that shall have become a Lender hereunder pursuant to Section 2.09 or an
Assignment and Assumption or otherwise, other than any such Person that ceases
to be a Lender hereunder pursuant to an Assignment and Assumption or otherwise.
Unless the context otherwise requires, the term “Lenders” includes the Swingline
Lender and the Issuing Bank.

“Letter of Credit Agreement” has the meaning assigned to it in Section 2.06(b).

“Letters of Credit” means the letters of credit issued pursuant to this
Agreement, and the term “Letter of Credit” means any one of them or each of them
singularly, as the context may require.

“LIBO Rate” means, with respect to any Eurodollar Borrowing for any applicable
Interest Period or for any ABR Borrowing, LIBO Screen Rate at approximately
11:00 a.m., London time, two (2) Business Days prior to the commencement of such
Interest Period; provided that, if the LIBO Screen Rate shall not be available
at such time for such Interest Period (an “Impacted Interest Period”), then the
LIBO Rate shall be the Interpolated Rate, subject to Section 2.14 in the event
that the Administrative Agent shall conclude that it shall not be possible to
determine such Interpolated Rate (which conclusion shall be conclusive and
binding absent manifest error). Notwithstanding the above, to the extent that
“LIBO Rate” or “Adjusted LIBO Rate” is used in connection with an ABR Borrowing,
such rate shall be determined as modified by the definition of Alternate Base
Rate.

 

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“LIBO Screen Rate” means, for any day and time, with respect to any Eurodollar
Borrowing for any Interest Period or for any ABR Borrowing, the London interbank
offered rate as administered by ICE Benchmark Administration (or any other
Person that takes over the administration of such rate for Dollars) for a period
equal in length to such Interest Period as displayed on such day and time on
pages LIBOR01 or LIBOR02 of the Reuters screen that displays such rate (or, in
the event such rate does not appear on a Reuters page or screen, on any
successor or substitute page on such screen that displays such rate, or on the
appropriate page of such other information service that publishes such rate from
time to time as selected by the Administrative Agent in its reasonable
discretion); provided that if the LIBO Screen Rate as so determined would be
less than zero, such rate shall be deemed to zero for the purposes of this
Agreement.

“Lien” means, with respect to any asset, (a) any mortgage, deed of trust, lien,
pledge, hypothecation, encumbrance, charge or security interest in, on or of
such asset, (b) the interest of a vendor or a lessor under any conditional sale
agreement, capital lease or title retention agreement (or any financing lease
having substantially the same economic effect as any of the foregoing) relating
to such asset and (c) in the case of securities, any purchase option, call or
similar right of a third party with respect to such securities; provided that in
no event shall an operating lease or an agreement to sell be deemed to
constitute a Lien.

“Loan Borrowing Option” has the meaning assigned to such term in the DDA Access
Product Agreement.

“Loan Documents” means, collectively, this Agreement, any Joinder Agreement, any
promissory notes issued pursuant to this Agreement, any Letter of Credit
Agreement, the Collateral Documents, the Loan Guaranty, any Intercreditor
Agreement and any other document designated a “Loan Document” by the Borrower
Representative and the Administrative Agent, now or hereafter executed by or on
behalf of any Loan Party, and delivered to the Administrative Agent or any
Lender in connection with this Agreement or the transactions contemplated
hereby. Any reference in this Agreement or any other Loan Document to a Loan
Document shall include all appendices, exhibits or schedules thereto, and all
amendments, restatements, supplements or other modifications thereto, and shall
refer to this Agreement or such Loan Document as the same may be in effect at
any and all times such reference becomes operative.

“Loan Guarantor” means each Loan Party in its capacity as a guarantor of the
Secured Obligations pursuant to its Loan Guaranty.

“Loan Guaranty” means Article X of this Agreement and, if applicable, each
separate Guarantee, in form and substance satisfactory to the Administrative
Agent, delivered by each Loan Guarantor that is a Foreign Subsidiary (which
Guarantee shall be governed by the laws of the country in which such Foreign
Subsidiary is located), as it may be amended or modified and in effect from time
to time.

“Loan Parties” means, collectively, the Parent, the Borrowers, the Parent’s
Subsidiaries (other than Excluded Subsidiaries) and any other Person who becomes
a party to this Agreement pursuant to a Joinder Agreement and their respective
successors and assigns, and the term “Loan Party” shall mean any one of them or
all of them individually, as the context may require.

 

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“Loans” means the loans and advances made by the Lenders pursuant to this
Agreement, including Swingline Loans, Overadvances and Protective Advances.

“Margin Stock” means margin stock within the meaning of Regulations T, U and X,
as applicable.

“Material Adverse Effect” means a material adverse effect on (a) the business,
assets, operations or financial condition of the Parent and its Subsidiaries
taken as a whole, (b) the ability of the Loan Parties, taken as a whole, to
perform their obligations under the Loan Documents or (c) the rights of or
benefits available to the Administrative Agent, the Issuing Bank or the Lenders
under any of the Loan Documents.

“Material Indebtedness” means Indebtedness (other than the Loans and Letters of
Credit), or obligations in respect of one or more Swap Agreements, of any one or
more of the Parent and its Subsidiaries in an aggregate principal amount
exceeding $10,000,000.

“Maturity Date” means (a) August 26, 2022; provided, however, that if the
aggregate outstanding principal amount of the Convertible Notes and all related
obligations have not been repaid in full on or prior to December 15, 2021 or
refinanced with a new maturity date no earlier than February 26, 2023, the date
referred to in this clause (a) shall instead be December 16, 2021, and (b) or
any earlier date on which the Commitments are reduced to zero or otherwise
terminated pursuant to the terms hereof.

“Maximum Rate” has the meaning assigned to such term in Section 9.17.

“Moody’s” means Moody’s Investors Service, Inc. (and any successor to the rating
agency business thereof).

“Mortgage” has the meaning assigned to such term in the U.S. Security Agreement.

“Multiemployer Plan” means a multiemployer plan as defined in Section 4001(a)(3)
of ERISA.

“Net Income” means, for any period, the consolidated net income (or loss) of the
Parent and its Subsidiaries, determined on a consolidated basis in accordance
with GAAP; provided, however that the following items shall be excluded in
computing Net Income (without duplication):

(a) the income (or loss) of any Person accrued prior to the date it becomes a
Subsidiary or is merged into or consolidated with the Parent or any of its
Subsidiaries, except (i) with respect to net income, to the extent of the amount
of dividends or other distributions actually paid to such Person or any of its
Subsidiaries by such other Person during such period and (ii) with respect to
net losses, to the extent of the amount of Investments made by such Person or
any of its Subsidiaries in such other Person during such period;

(b) any gain or loss attributable to sales of assets other than in the ordinary
course of business;

(c) any non-cash charge or expense attributable to application of the purchase
or recapitalization method of accounting (including the total amount of
depreciation and amortization, cost of sales or other non-cash expense resulting
from the write up of assets to the extent resulting from such purchase or
recapitalization accounting adjustments);

(d) any gain or loss for such period attributable to the early extinguishment or
retirement of Swap Agreements or other similar derivative instruments;

 

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(e) any item classified or disclosed as an extraordinary, unusual or
nonrecurring gain, loss or charge;

(f) any compensation expense paid or payable solely with Equity Interests (other
than Disqualified Stock) of such Person or any options, warrants or other rights
to acquire capital stock (other than Disqualified Stock);

(g) any non-cash gain or loss resulting from mark-to-market accounting related
to Swap Agreements or other derivate instruments; and

(h) to the extent otherwise included in Net Income, any unrealized currency
translation gains or losses including those related to currency remeasurements
of Indebtedness (including any loss or gain resulting from any foreign exchange
contracts, currency Swap Agreement or other similar agreement or arrangement or
other derivative instrument).

“Non-Consenting Lender” has the meaning assigned to such term in
Section 9.02(d).

“NYFRB” means the Federal Reserve Bank of New York.

“NYFRB Rate” means, for any day, the greater of (a) the Federal Funds Effective
Rate in effect on such day and (b) the Overnight Bank Funding Rate in effect on
such day(or for any day that is not a Business Day, for the immediately
preceding Business Day); provided that if none of such rates are published for
any day that is a Business Day, the term “NYFRB Rate” means the rate for a
federal funds transaction quoted at 11:00 a.m. on such day received by the
Administrative Agent from a federal funds broker of recognized standing selected
by it; provided, further, that if any of the aforesaid rates as so determined
would be less than zero, such rate shall be deemed to be zero for purposes of
this Agreement.

“Obligated Party” has the meaning assigned to such term in Section 10.02.

“Obligations” means all unpaid principal of and accrued and unpaid interest on
the Loans, all LC Exposure, all accrued and unpaid fees and all expenses,
reimbursements, indemnities and other obligations and indebtedness (including
interest and fees accruing during the pendency of any bankruptcy, insolvency,
receivership or other similar proceeding, regardless of whether allowed or
allowable in such proceeding), obligations and liabilities of any of the Loan
Parties to any of the Lenders, the Administrative Agent, the Issuing Bank or any
indemnified party, individually or collectively, existing on the Effective Date
or arising thereafter, direct or indirect, joint or several, absolute or
contingent, matured or unmatured, liquidated or unliquidated, secured or
unsecured, arising by contract, operation of law or otherwise, arising or
incurred under this Agreement or any of the other Loan Documents or in respect
of any of the Loans made or reimbursement or other obligations incurred or any
of the Letters of Credit or other instruments at any time evidencing any
thereof.

“OFAC” means the Office of Foreign Assets Control of the United States
Department of the Treasury.

“Off-Balance Sheet Liability” of a Person means (a) any repurchase obligation or
liability of such Person with respect to accounts or notes receivable sold by
such Person, (b) any indebtedness, liability or obligation under any so-called
“synthetic lease” transaction entered into by such Person, or (c) any
indebtedness, liability or obligation arising with respect to any other
transaction which is the functional equivalent of or takes the place of
borrowing but which does not constitute a liability on the balance sheet of such
Person (other than operating leases).

 

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“Other Connection Taxes” means, with respect to any Recipient, Taxes imposed as
a result of a present or former connection between such Recipient and the
jurisdiction imposing such Taxes (other than a connection arising from such
Recipient having executed, delivered, become a party to, performed its
obligations under, received payments under, received or perfected a security
interest under, engaged in any other transaction pursuant to, or enforced, any
Loan Document, or sold or assigned an interest in any Loan, Letter of Credit or
any Loan Document).

“Other Taxes” means all present or future stamp, court or documentary,
intangible, recording, filing or similar Taxes that arise from any payment made
under, from the execution, delivery, performance, enforcement or registration
of, from the receipt or perfection of a security interest under, or otherwise
with respect to, any Loan Document, except any such Taxes that are Other
Connection Taxes imposed with respect to an assignment (other than an assignment
made pursuant to Section 2.19).

“Overadvance” has the meaning assigned to such term in Section 2.05(b).

“Overnight Bank Funding Rate” means, for any day, the rate comprised of both
overnight federal funds and overnight Eurodollar borrowings by U.S.-managed
banking offices of depository institutions (as such composite rate shall be
determined by the NYFRB as set forth on its public website from time to time)
and published on the next succeeding Business Day by the NYFRB as an overnight
bank funding rate.

“Paid in Full” or “Payment in Full” means, (a) the indefeasible payment in full
in cash of all outstanding Loans and LC Disbursements, together with accrued and
unpaid interest thereon, (b) the termination, expiration, or cancellation and
return of all outstanding Letters of Credit (or alternatively, with respect to
each such Letter of Credit, the furnishing to the Administrative Agent of a cash
deposit, or at the discretion of the Administrative Agent a backup standby
letter of credit reasonably satisfactory to the Administrative Agent and the
Issuing Bank, in an amount equal to 103% of the LC Exposure as of the date of
such payment), (c) the indefeasible payment in full in cash of the accrued and
unpaid fees, (d) the indefeasible payment in full in cash of all reimbursable
expenses and other Obligations (other than Unliquidated Obligations for which no
claim has been made and other obligations expressly stated to survive such
payment and termination of this Agreement), together with accrued and unpaid
interest thereon, (e) the termination of all Commitments, and (f) the
termination of the Swap Agreement Obligations and the Banking Services
Obligations or entering into other arrangements satisfactory to the Secured
Parties counterparties thereto.

“Parent” means Gogo Inc., a Delaware corporation.

“Participant” has the meaning assigned to such term in Section 9.04(c).

“Participant Register” has the meaning assigned to such term in Section 9.04(c).

“Payment Conditions” shall be deemed to be satisfied in connection with a
proposed designated action if:

(a) no Default has occurred and is continuing or would result immediately after
giving effect to such proposed designated action;

(b) immediately after giving effect to such proposed designated action, the Loan
Parties shall have (i) (A) Specified Availability on the date of, and at all
times during the thirty (30) day period immediately prior to, such proposed
designated action, calculated on a pro forma basis after giving effect to such
proposed designated action of not less than the greater of (1) 20%

 

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of the Revolving Commitment or (2) $6,000,000, and (B) a Fixed Charge Coverage
Ratio for the most recently completed twelve month period for which a Compliance
Certificate has been delivered calculated on a pro forma basis after giving
effect to such proposed designated action of not less than 1.10 to 1.00 or
(ii) Specified Availability on the date of, and at all times during the thirty
(30) day period immediately prior to, such proposed designated action,
calculated on a pro forma basis after giving effect to such proposed designated
action of not less than the greater of (A) 25% of the Revolving Commitment or
(B) $7,500,000; and

(c) the Parent shall have delivered to the Administrative Agent a certificate in
form and substance reasonably satisfactory to the Administrative Agent
certifying as to the items described in (a) and (b) above and attaching
calculations for item (b).

If any proposed designated action involves a Disposition (including by way of an
Investment or a Restricted Payment) of Accounts of a Borrowing Base Party, the
Parent shall deliver to the Administrative Agent an update to the most recently
delivered Borrowing Base Certificate giving pro forma effect to such
Disposition, and the Borrowing Base shall be so adjusted prior to computing
Specified Availability for purposes of this definition.

“PBGC” means the Pension Benefit Guaranty Corporation referred to and defined in
ERISA and any successor entity performing similar functions.

“Permitted Acquisition” means any Acquisition by the Parent or any of its
Subsidiaries in a transaction that satisfies each of the following requirements:

(a) such Acquisition is not a hostile or contested acquisition;

(b) the business acquired in connection with such Acquisition is not engaged,
directly or indirectly, in any line of business other than the businesses in
which the Loan Parties are engaged on the Effective Date and any business
activities that are substantially similar, related, or incidental thereto;

(c) both before and after giving effect to such Acquisition, no Default exists
or would result therefrom;

(d) both before and immediately after giving pro forma effect to such
Acquisition, the Payment Conditions shall be satisfied; and

(e) with respect to each such Acquisition, all actions required to be taken with
respect to any newly acquired or formed wholly owned Subsidiary of a Loan Party
or assets in order to satisfy the requirements under Section 5.13 shall have
been taken (or arrangements for the taking of such actions satisfactory to the
Administrative Agent shall have been made).

“Permitted Discretion” means a determination made in good faith and in the
exercise of reasonable (from the perspective of a secured asset-based lender)
business judgment.

“Permitted Encumbrances” means:

(a) Liens imposed by law for Taxes that are not yet due or are being contested
in compliance with Section 5.04;

 

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(b) carriers’, landlord’s, warehousemen’s, mechanics’, suppliers’,
materialmen’s, repairmen’s and other like Liens imposed by law, arising in the
ordinary course of business and securing obligations that are not overdue by
more than sixty (60) days or are being contested in compliance with Section 5.04
and for which a reserve or other appropriate provision, if any, as shall be
required in conformity with GAAP shall have been made;

(c) pledges or deposits made in the ordinary course of business in compliance
with workers’ compensation, unemployment insurance and other social security
laws or regulations and other similar insurance-related obligations (including,
without limitation, pledges or deposits securing liability to insurance carriers
under insurance or self-insurance arrangements);

(d) deposits to secure the performance of tenders, bids, trade contracts,
leases, statutory obligations, bankers’ acceptances, surety and appeal bonds,
performance bonds, government contracts, performance and return-of-money bonds
and other obligations of a like nature, in each case in the ordinary course of
business (exclusive of obligations for the payment of borrowed money);

(e) judgment Liens in respect of judgments that do not constitute an Event of
Default under clause (k) of Article VII; and

(f) easements, zoning restrictions, rights-of-way and similar encumbrances,
title defects or other irregularities on real property imposed by law or arising
in the ordinary course of business that do not secure any monetary obligations
and do not materially detract from the value of the affected property or
interfere with the ordinary conduct of business of any Borrower or any
Subsidiary;

provided that the term “Permitted Encumbrances” shall not include any Lien
securing Indebtedness, except with respect to clause (e) above.

“Permitted Holder” means Oakleigh Thorne, Thorndale Farm, LLC or any of their
respective Affiliates.

“Permitted Investments” means:

(a) U.S. Dollars, Canadian Dollars, Japanese yen, pounds sterling, euros or the
national currency of any participating member state of the European Union and,
with respect to any Foreign Subsidiary, other currencies held by such Foreign
Subsidiary in the ordinary course of business;

(b) direct obligations of, or obligations the principal of and interest on which
are unconditionally guaranteed by, the U.S. (or by any agency thereof to the
extent such obligations are backed by the full faith and credit of the U.S.) or
any country that is a member of the European Union or any agency or
instrumentality thereof, in each case with maturities not exceeding two years
from the date of acquisition;

(c) investments in commercial paper maturing within 270 days from the date of
acquisition, issued by a corporation (other than the Parent’s Affiliate)
organized and in existence under the laws of the United States of America, any
state thereof or any foreign country recognized by the United States of America
with a rating at the time as of which any Investment therein is made of “P-1”
(or higher) according to Moody’s or “A-1” (or higher) according to S&P;

 

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(d) investments in certificates of deposit, bankers’ acceptances and time
deposits maturing within one year from the date of acquisition thereof issued or
guaranteed by or placed with, and money market deposit accounts issued or
offered by, any domestic office of any commercial bank organized under the laws
of the U.S. or any State thereof or any foreign country recognized by the U.S.,
and which has a combined capital and surplus and undivided profits of not less
than $500,000,000 (or the foreign currency equivalent thereof);

(e) repurchase agreements for underlying securities described in clause (b) and
(d) above and entered into with a financial institution satisfying the criteria
described in clause (d) above;

(f) securities with maturities of six months or less from the date of
acquisition issued or fully and unconditionally guaranteed by any state,
commonwealth or territory of the United States of America, or by any political
subdivision or taxing authority thereof, and rated at least “A” by S&P or
Moody’s;

(g) corporate debt securities with maturities of eighteen months or less from
the date of acquisition and with a rating at the time as of which any Investment
therein is made of “A3” (or higher) according to Moody’s or “A-” (or higher)
according to S&P;

(h) securities with maturities of six months or less from the date of
acquisition backed by standby letters of credit issued by any commercial bank
organized under the laws of the United States or any state thereof and having a
combined capital and surplus of not less than $500.0 million;

(i) direct obligations of a foreign government recognized by the United States
of America with a maturity not more than twelve months from the date of
acquisition and rated at least “A” by S&P;

(j) money market funds sponsored by a registered broker dealer or mutual fund
distributor at least 95% of the assets of which are invested in the foregoing;
and

(k) in the case of Investments by any Foreign Subsidiary, Investments of
comparable tenor and credit quality to those described in the foregoing clauses
(a) through (j) customarily utilized in the countries where such Foreign
Subsidiary is located for short-term cash management purposes.

“Person” means any natural person, corporation, limited liability company,
unlimited liability company, trust, joint venture, association, company,
partnership, Governmental Authority or other entity.

“Plan” means any employee pension benefit plan (other than a Multiemployer Plan)
subject to the provisions of Title IV of ERISA or Section 412 of the Code or
Section 302 of ERISA, and in respect of which any Borrower or any ERISA
Affiliate is (or, if such plan were terminated, would under Section 4069 of
ERISA be deemed to be) an “employer” as defined in Section 3(5) of ERISA.

“Plan Asset Regulations” means 29 CFR § 2510.3-101 et seq., as modified by
Section 3(42) of ERISA, as amended from time to time.

“PPSA” means the Personal Property Security Act (British Columbia), including
the regulations thereto, provided that, if perfection or the effect of
perfection or non-perfection or the priority of any Lien created hereunder on
the Collateral is governed by the personal property security legislation or
other

 

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applicable legislation with respect to personal property security, in effect in
a jurisdiction other than Ontario, “PPSA” means the Personal Property Security
Act or such other applicable legislation (including the Civil Code of Quebec) in
effect from time to time in such other jurisdiction for the purposes of the
provisions hereof relating to such perfection, effect of perfection or
non-perfection or priority.

“Prime Rate” means the rate of interest last quoted by The Wall Street Journal
as the “Prime Rate” in the U.S. or, if The Wall Street Journal ceases to quote
such rate, the highest per annum interest rate published by the Federal Reserve
Board in Federal Reserve Statistical Release H.15 (519) (Selected Interest
Rates) as the “bank prime loan” rate or, if such rate is no longer quoted
therein, any similar rate quoted therein (as determined by the Administrative
Agent) or any similar release by the Federal Reserve Board (as determined by the
Administrative Agent). Each change in the Prime Rate shall be effective from and
including the date such change is publicly announced or quoted as being
effective.

“Proceeds of Crime Act” means the Proceeds of Crime (Money Laundering) and
Terrorist Financing Act, S.C. 2000, c. 17, as amended from time to time, and
including all regulations thereunder.

“Processor Control Agreement” means, with respect to any Credit Card Processor
providing credit card processing services for or on behalf of any Borrowing Base
Party, an agreement in form and substance reasonably satisfactory to the
Administrative Agent in its Permitted Discretion, executed and delivered by the
applicable Borrowing Base Party, such Credit Card Processor and the
Administrative Agent, pursuant to which such Credit Card Processor shall agree,
among other things, to follow instructions originated by the Administrative
Agent regarding amounts payable by such Credit Card Processor to such Borrowing
Base Party pursuant to the applicable credit card processing agreement without
the further consent of such Borrowing Base Party under circumstances specified
therein, as such agreement may be amended, supplemented or otherwise modified
from time to time.

“Projections” has the meaning assigned to such term in Section 5.01(f).

“Protective Advance” has the meaning assigned to such term in Section 2.04.

“PTE” means a prohibited transaction class exemption issued by the U.S.
Department of Labor, as any such exemption may be amended from time to time.

“QFC” has the meaning assigned to the term “qualified financial contract” in,
and shall be interpreted in accordance with, 12 U.S.C. 5390(c)(8)(D).

“QFC Credit Support” has the meaning assigned to it in Section 9.21.

“Qualified ECP Guarantor” means, in respect of any Swap Obligation, each Loan
Party that has total assets exceeding $10,000,000 at the time the relevant Loan
Guaranty or grant of the relevant security interest becomes or would become
effective with respect to such Swap Obligation or such other person as
constitutes an “eligible contract participant” under the Commodity Exchange Act
or any regulations promulgated thereunder and can cause another person to
qualify as an “eligible contract participant” at such time by entering into a
keepwell under Section 1a(18)(A)(v)(II) of the Commodity Exchange Act.

“Qualified Equity Interests” means any Equity Interests that are not
Disqualified Equity Interests.

“Recipient” means, as applicable, (a) the Administrative Agent, (b) any Lender
and (c) any Issuing Bank, or any combination thereof (as the context requires).

“Refinance Indebtedness” has the meaning assigned to such term in
Section 6.01(f).

 

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“Register” has the meaning assigned to such term in Section 9.04(b).

“Regulation D” means Regulation D of the Federal Reserve Board, as in effect
from time to time and all official rulings and interpretations thereunder or
thereof.

“Regulation T” means Regulation T of the Federal Reserve Board, as in effect
from time to time and all official rulings and interpretations thereunder or
thereof.

“Regulation U” means Regulation U of the Federal Reserve Board, as in effect
from time to time and all official rulings and interpretations thereunder or
thereof.

“Regulation X” means Regulation X of the Federal Reserve Board, as in effect
from time to time and all official rulings and interpretations thereunder or
thereof.

“Related Parties” means, with respect to any specified Person, such Person’s
Affiliates and the respective directors, officers, partners, members, trustees,
employees, agents, administrators, managers, representatives and advisors of
such Person and such Person’s Affiliates.

“Release” means any releasing, spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leaching, migrating, disposing or
dumping of any substance into the environment.

“Report” means reports prepared by the Administrative Agent or another Person
showing the results of appraisals, field examinations or audits pertaining to
the assets of the Borrowing Base Parties from information furnished by or on
behalf of the Borrowers, after the Administrative Agent has exercised its rights
of inspection pursuant to this Agreement, which Reports may be distributed to
the Lenders by the Administrative Agent.

“Required Lenders” means, subject to Section 2.20, (a) at any time prior to the
earlier of the Loans becoming due and payable pursuant to Article VII or the
Commitments terminating or expiring, Lenders having Revolving Exposures and
Unfunded Commitments representing more than 50% of the sum of the Aggregate
Revolving Exposure and Unfunded Commitments at such time; provided that, as long
as there are only two (2) or fewer Lenders, Required Lenders shall mean all
Lenders; provided further that, solely for purposes of declaring the Loans to be
due and payable pursuant to Article VII, the Unfunded Commitment of each Lender
shall be deemed to be zero in determining the Required Lenders; and (b) for all
purposes after the Loans become due and payable pursuant to Article VII or the
Commitments expire or terminate, Lenders having Revolving Exposures representing
more than 50% of the sum of the Aggregate Revolving Exposure at such time.

“Requirement of Law” means, with respect to any Person, (a) the charter,
articles or certificate of organization or incorporation and bylaws or
operating, management or partnership agreement, or other organizational or
governing documents of such Person, (b) Payment Card Industry Data Security
Standards and (c) any statute, law (including common law), treaty, rule,
regulation, code, ordinance, order, decree, writ, judgment, injunction or
determination of any arbitrator or court or other Governmental Authority
(including Environmental Laws), in each case applicable to or binding upon such
Person or any of its property or to which such Person or any of its property is
subject.

“Reserves” means, without duplication, any and all reserves which the
Administrative Agent deems necessary, in its Permitted Discretion, to maintain
(including, without limitation, reserves for accrued and unpaid interest on the
Obligations, Banking Services Reserves (without duplication of any Applicable
Ancillary Obligations Reserve), the Canadian Priority Payable Reserve,
volatility reserves,

 

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reserves for dilution of Accounts and/or Credit Card Receivables, reserves for
Swap Agreement Obligations (without duplication of any Applicable Ancillary
Obligations Reserve), reserves for contingent liabilities of any Borrowing Base
Party, reserves for uninsured losses of any Borrowing Base Party, reserves for
uninsured, underinsured, un-indemnified or under-indemnified liabilities or
potential liabilities with respect to any litigation and reserves for taxes,
fees, assessments, and other governmental charges) with respect to the
Collateral consisting of a type that is included in the Borrowing Base or any
Borrowing Base Party.

“Responsible Officer” means the president or Financial Officer of a Borrower, it
being understood that any such Person shall have been identified on a properly
completed Appointment of Designated Authority Letter that has been executed and
delivered to the Administrative Agent.

“Restricted Payment” means any dividend or other distribution (whether in cash,
securities or other property) with respect to any Equity Interests in the Parent
or any Subsidiary, or any payment (whether in cash, securities or other
property), including any sinking fund or similar deposit, on account of the
purchase, redemption, retirement, acquisition, cancellation or termination of
any such Equity Interests or any option, warrant or other right to acquire any
such Equity Interests.

“Revolving Commitment” means, with respect to each Lender, the amount set forth
on the Commitment Schedule opposite such Lender’s name, or in the Assignment and
Assumption or other documentation or record (as such term is defined in
Section 9-102(a)(70) of the New York Uniform Commercial Code) as provided in
Section 9.04(b)(ii)(C) pursuant to which such Lender shall have assumed its
Revolving Commitment, as applicable, as such Revolving Commitment may be reduced
or increased from time to time pursuant to (a) Section 2.09 and (b) assignments
by or to such Lender pursuant to Section 9.04; provided, that at no time shall
the Revolving Exposure of any Lender exceed its Revolving Commitment.

“Revolving Exposure” means, with respect to any Lender at any time, the sum of
(a) the outstanding principal amount of such Lender’s Revolving Loans, its LC
Exposure and its Swingline Exposure at such time, plus (b) an amount equal to
its Applicable Percentage of the aggregate principal amount of Protective
Advances outstanding at such time, plus (c) an amount equal to its Applicable
Percentage of the aggregate principal amount of Overadvances outstanding at such
time.

“Revolving Lender” means, as of any date of determination, a Lender with a
Revolving Commitment or, if the Revolving Commitments have terminated or
expired, a Lender with Revolving Exposure.

“Revolving Loan” means a Loan made pursuant to Section 2.01(a).

“S&P” means Standard & Poor’s Ratings Services, a Standard & Poor’s Financial
Services LLC business.

“Sale and Leaseback Transaction” has the meaning assigned to such term in
Section 6.06.

“Sanctioned Country” means, at any time, a country, region or territory which is
itself the subject or target of any comprehensive Sanctions (at the time of this
Agreement, Crimea, Cuba, Iran, North Korea and Syria).

 

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“Sanctioned Person” means, at any time, (a) any Person listed in any
Sanctions-related list of designated Persons maintained by OFAC, the U.S.
Department of State, the United Nations Security Council, the European Union or
any European Union member state or Her Majesty’s Treasury of the United Kingdom,
(b) any Person operating, organized or resident in a Sanctioned Country,
(c) Canadian Blocked Persons, (d) any Person owned or controlled by any such
Person or Persons described in the foregoing clauses (a), (b), or (c), and
(e) any Person otherwise the target of any Sanctions.

“Sanctions” means all economic or financial sanctions or trade embargoes
imposed, administered or enforced from time to time by (a) the U.S. government,
including those administered by the Office of Foreign Assets Control of the U.S.
Department of the Treasury or the U.S. Department of State, or (b) the United
Nations Security Council, the European Union, any European Union member state or
Her Majesty’s Treasury of the United Kingdom, the federal government of Canada.

“SEC” means the Securities and Exchange Commission of the U.S.

“Secured Obligations” means all Obligations, together with all (a) Banking
Services Obligations and (b) Swap Agreement Obligations owing to one or more
Lenders or their respective Affiliates; provided, however, that the definition
of “Secured Obligations” shall not create any guarantee by any Loan Guarantor of
(or grant of security interest by any Loan Guarantor to support, as applicable)
any Excluded Swap Obligations of such Loan Guarantor for purposes of determining
any obligations of any Loan Guarantor.

“Secured Leverage Ratio” means, as of any date of determination, the ratio of
(a) Indebtedness of the Parent and its Subsidiaries on such date that is secured
by a Lien on property thereof to (b) EBITDA for the period of four
(4) consecutive fiscal quarters for which financial statements have been
delivered pursuant to Section 5.01 ending immediately prior to such date.

“Secured Parties” means (a) the Administrative Agent, (b) the Lenders, (c) each
Issuing Bank, (d) each provider of Banking Services, to the extent the Banking
Services Obligations in respect thereof constitute Secured Obligations, (e) each
counterparty to any Swap Agreement, to the extent the obligations thereunder
constitute Secured Obligations, (f) the beneficiaries of each indemnification
obligation undertaken by any Loan Party under any Loan Document, and (g) the
successors and assigns of each of the foregoing.

“Senior Secured Notes” means the Borrowers’ existing 9.875% Senior Secured Notes
due 2024 and issued pursuant to the Senior Secured Notes Indenture and as may be
replaced or refinanced in whole or in part in accordance with the terms hereof.

“Senior Secured Notes Documents” means, collectively, the Senior Secured Notes,
the Senior Secured Notes Indenture and all other agreements, instruments,
documents and certificates executed and/or delivered in connection therewith
(including any and all collateral documents), as the same may be amended,
restated, supplemented or otherwise modified from time to time in accordance
with the terms hereof and of the Senior Secured Notes Intercreditor Agreement.

“Senior Secured Notes Indenture” means that certain Indenture dated as of
April 25, 2019, among the Borrowers, as the issuers thereunder, the guarantors
party thereto, and U.S. Bank National Association, as trustee and collateral
agent, as the same may be amended, restated, supplemented or otherwise modified
from time to time and as replaced or refinanced in whole or in part in
accordance with the terms hereof and of the Senior Secured Notes Intercreditor
Agreement.

“Senior Secured Notes Intercreditor Agreement” means that certain Crossing Lien
Intercreditor Agreement, dated as of the Effective Date, between the Senior
Secured Note Representative, as the “Cash Flow Representative” thereunder, and
the Administrative Agent, as the “ABL Representative” thereunder, as the same
may be amended, restated, supplemented or otherwise modified form time to time
in accordance with the term hereof.

 

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“Senior Secured Notes Representative” means U.S. Bank, National Association, in
its capacity as collateral agent for the holders of Senior Secured Notes (or any
successor agent thereunder or under any replacement thereof).

“Senior Secured Notes Obligations” means the Indebtedness and other obligations
of the Parent and its Subsidiaries under the Senior Secured Notes Documents.

“Senior Secured Notes Priority Collateral” has the meaning assigned to the term
“Cash Flow Priority Collateral” in the Senior Secured Notes Intercreditor
Agreement.

“Settlement” has the meaning assigned to such term in Section 2.05(d).

“Settlement Date” has the meaning assigned to such term in Section 2.05(d).

“Specified Availability” means, at any time, an amount equal to (a) the lesser
of (i) the Aggregate Revolving Commitment minus the Applicable Ancillary
Obligations Reserve and (ii) the Borrowing Base, plus (b) an amount, if
positive, by which the Borrowing Base exceeds the amount in clause (i) (not to
exceed $1,500,000), minus (c) the Aggregate Revolving Exposure (calculated, with
respect to any Defaulting Lender, as if such Defaulting Lender had funded its
Applicable Percentage of all outstanding Borrowings).

“Specified Transaction” means any (a) Disposition of assets having an aggregate
fair market value equal to or in excess of $15,000,000, or (b) Acquisition for
aggregate consideration equal to or in excess of $15,000,000.

“Spot Rate” has the meaning assigned to such term in the definition of Dollar
Equivalent.

“Standby LC Exposure” means, at any time, the sum of (a) the aggregate undrawn
amount of all standby Letters of Credit outstanding at such time plus (b) the
aggregate amount of all LC Disbursements relating to standby Letters of Credit
that have not yet been reimbursed by or on behalf of the Borrowers at such time.
The Standby LC Exposure of any Revolving Lender at any time shall be its
Applicable Percentage of the aggregate Standby LC Exposure at such time.

“Statements” has the meaning assigned to such term in Section 2.18(f).

“Statutory Reserve Rate” means a fraction (expressed as a decimal), the
numerator of which is the number one and the denominator of which is the number
one minus the aggregate of the maximum reserve percentage (including any
marginal, special, emergency or supplemental reserves) established by the
Federal Reserve Board to which the Administrative Agent is subject with respect
to the Adjusted LIBO Rate, for eurocurrency funding (currently referred to as
“Eurocurrency liabilities” in Regulation D). Such reserve percentages shall
include those imposed pursuant to Regulation D of the Board. Eurodollar Loans
shall be deemed to constitute eurocurrency funding and to be subject to such
reserve requirements without benefit of or credit for proration, exemptions or
offsets that may be available from time to time to any Lender under Regulation D
of the Board or any comparable regulation. The Statutory Reserve Rate shall be
adjusted automatically on and as of the effective date of any change in any
reserve percentage.

“Subordinated Indebtedness” of a Person means any Indebtedness of such Person
the payment of which is contractually subordinated to payment of the Secured
Obligations to the reasonable satisfaction of the Administrative Agent. For the
avoidance of doubt, the Senior Secured Notes Obligations do not constitute
Subordinated Indebtedness pursuant to the terms thereof in effect on the
Effective Date.

 

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“subsidiary” means, with respect to any Person, any corporation, association or
other business entity of which more than 50% of the voting power of the
outstanding voting power is owned, controlled or held directly or indirectly, by
such Person and/or one or more other Subsidiaries of such Person.

“Subsidiary” means any direct or indirect subsidiary of the Parent or another
Loan Party, as applicable.

“Supermajority Lenders” means, subject to Section 2.20, (a) at any time prior to
the earlier of the Loans becoming due and payable pursuant to Article VII or the
Commitments terminating or expiring, Lenders having Revolving Exposures and
Unfunded Commitments representing more than 80% of the sum of the Aggregate
Revolving Exposure and Unfunded Commitments at such time; provided that, solely
for purposes of declaring the Loans to be due and payable pursuant to Article
VII, the Unfunded Commitment of each Lender shall be deemed to be zero in
determining the Required Lenders; and (b) for all purposes after the Loans
become due and payable pursuant to Article VII or the Commitments expire or
terminate, Lenders having Revolving Exposures representing more than 80% of the
sum of the Aggregate Revolving Exposure at such time.

“Supported QFC” has the meaning assigned to it in Section 9.21.

“Swap Agreement” means any agreement with respect to any swap, forward, spot,
future, credit default or derivative transaction or option or similar agreement
involving, or settled by reference to, one or more rates, currencies,
commodities, equity or debt instruments or securities, or economic, financial or
pricing indices or measures of economic, financial or pricing risk or value or
any similar transaction or any combination of these transactions; provided that
no phantom stock or similar plan providing for payments only on account of
services provided by current or former directors, officers, employees or
consultants of the Borrowers or the Subsidiaries shall be a Swap Agreement.

“Swap Agreement Obligations” means any and all obligations of the Loan Parties
(other than Parent), whether absolute or contingent and howsoever and whensoever
created, arising, evidenced or acquired (including all renewals, extensions and
modifications thereof and substitutions therefor), under (a) any and all Swap
Agreements permitted hereunder with the Administrative Agent, a Lender or an
Affiliate of the Administrative Agent or a Lender, and (b) any and all
cancellations, buy backs, reversals, terminations or assignments of any Swap
Agreement transaction permitted hereunder with the Administrative Agent, a
Lender or an Affiliate of the Administrative Agent or a Lender; provided, that,
in the case of clause (a) or (b), the Administrative Agent has been notified of
such obligations pursuant to Section 2.22.

“Swap Obligation” means, with respect to any Loan Guarantor, any obligation to
pay or perform under any agreement, contract or transaction that constitutes a
“swap” within the meaning of section 1a(47) of the Commodity Exchange Act or any
rules or regulations promulgated thereunder.

“Swap Termination Value” means, in respect of any one or more Swap Agreements,
after taking into account the effect of any legally enforceable netting
agreement relating to such Swap Agreements, (a) for any date on or after the
date such Swap Agreements have been closed out and termination value(s)
determined in accordance therewith, such termination value(s), and (b) for any
date prior to the date referenced in clause (a), the amount(s) determined as the
mark-to-market value(s) for such Swap Agreements, as determined based upon one
or more mid-market or other readily available quotations provided by any
recognized dealer in such Swap Agreements (which may include a Lender or any
Affiliate of a Lender).

 

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“Swingline Exposure” means, at any time, the aggregate principal amount of all
Swingline Loans outstanding at such time. The Swingline Exposure of any
Revolving Lender at any time shall be its Applicable Percentage of the total
Swingline Exposure at such time.

“Swingline Lender” means JPMCB, in its capacity as lender of Swingline Loans
hereunder. Any consent required of the Administrative Agent or the Issuing Bank
shall be deemed to be required of the Swingline Lender and any consent given by
JPMCB in its capacity as Administrative Agent or Issuing Bank shall be deemed
given by JPMCB in its capacity as Swingline Lender.

“Swingline Loan” has the meaning assigned to such term in Section 2.05(a).

“Syndication Agent” means Morgan Stanley Senior Funding, Inc.

“Target Balance” has the meaning assigned to such term in the DDA Access Product
Agreement.

“Taxes” means any and all present or future taxes, levies, imposts, duties,
deductions, withholdings (including backup withholding), value added taxes, or
any other goods and services, use or sales taxes, assessments, fees or other
charges imposed by any Governmental Authority, including any interest, additions
to tax or penalties applicable thereto.

“Total Leverage Ratio” means, on any date of determination, the ratio of (a) the
aggregate principal amount of Indebtedness of the Parent and its consolidated
Subsidiaries on such date to (b) EBITDA for the period of four (4) consecutive
fiscal quarters for which financial statements have been delivered pursuant to
Section 5.01 ending immediately prior to such date.

“Transactions” means the execution, delivery and performance by the Loan Parties
of this Agreement and the other Loan Documents, the borrowing of Loans and other
credit extensions, the use of the proceeds thereof and the issuance of Letters
of Credit hereunder.

“Twelve Month Period” has the meaning assigned to such term in Section 1.06(b).

“Type”, when used in reference to any Loan or Borrowing, refers to whether the
rate of interest on such Loan, or on the Loans comprising such Borrowing, is
determined by reference to the Adjusted LIBO Rate or the ABR.

“UCC” means the Uniform Commercial Code as in effect from time to time in the
State of New York or in any other state the laws of which are required to be
applied in connection with the issue of perfection of security interests.

“Unbilled Account” means an Account in respect of which no invoice for such
Account has been issued to the related Account Debtor.

“Unfinanced Capital Expenditures” means, for any period, Capital Expenditures
paid in cash during such period which are financed with Internally Generated
Cash.

“Unfunded Commitment” means, with respect to each Lender, the Revolving
Commitment of such Lender less its Revolving Exposure.

 

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“Unliquidated Obligations” means, at any time, any Secured Obligations (or
portion thereof) that are contingent in nature or unliquidated at such time,
including any Secured Obligation that is: (a) an obligation to reimburse a bank
for drawings not yet made under a letter of credit issued by it; (b) any other
obligation (including any guarantee) that is contingent in nature at such time;
or (c) an obligation to provide collateral to secure any of the foregoing types
of obligations.

“U.S.” means the United States of America.

“U.S. Person” means a “United States person” within the meaning of
Section 7701(a)(30) of the Code.

“U.S. Security Agreement” means that certain ABL Collateral Agreement (including
any and all supplements thereto), dated as of the date hereof, among the Loan
Parties and the Administrative Agent, for the benefit of the Administrative
Agent and the other Secured Parties, and any other pledge or security agreement
governed by the laws of a jurisdiction located within the United States, entered
into, after the date of this Agreement by any other Loan Party (as required by
this Agreement or any other Loan Document) or any other Person for the benefit
of the Administrative Agent and the other Secured Parties, as the same may be
amended, restated, supplemented or otherwise modified from time to time.

“U.S. Special Resolution Regime” has the meaning assigned to it in Section 9.21.

“U.S. Tax Compliance Certificate” has the meaning assigned to such term in
Section 2.17(f)(ii)(B)(3).

“USA PATRIOT Act” means the Uniting and Strengthening America by Providing
Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001.

“Vendor Financing Arrangement” means any supply chain financing arrangement,
structured vendor payable program, payables financing arrangement, reverse
factoring arrangement or any other similar arrangement or program pursuant to
which the Parent or any of its Loan Party Subsidiaries provides a vendor an
option to factor such vendor’s receivables from the Parent or such Loan Party
Subsidiary to a bank or financial institution, in each case, with respect to
property or assets used in the ordinary course of the Parent’s or its Loan Party
Subsidiaries’ business.

“wholly owned” means, with respect to a Subsidiary of a Person, a Subsidiary of
such Person all of the outstanding Equity Interests of which (other than
(x) director’s qualifying shares and (y) shares issued to foreign nationals to
the extent required by applicable Law) are owned by such Person and/or by one or
more wholly owned Subsidiaries of such Person.

“Withdrawal Liability” means liability to a Multiemployer Plan as a result of a
complete or partial withdrawal from such Multiemployer Plan, as such terms are
defined in Part I of Subtitle E of Title IV of ERISA.

“Write-Down and Conversion Powers” means, with respect to any EEA Resolution
Authority, the write-down and conversion powers of such EEA Resolution Authority
from time to time under the Bail-In Legislation for the applicable EEA Member
Country, which write-down and conversion powers are described in the EU Bail-In
Legislation Schedule.

SECTION 1.02. Classification of Loans and Borrowings. For purposes of this
Agreement, Loans may be classified and referred to by Class (e.g., a “Revolving
Loan”) or by Type (e.g., a “Eurodollar Loan”) or by Class and Type (e.g., a
“Eurodollar Revolving Loan”). Borrowings also may be classified and referred to
by Class (e.g., a “Revolving Borrowing”) or by Type (e.g., a “Eurodollar
Borrowing”) or by Class and Type (e.g., a “Eurodollar Revolving Borrowing”).

 

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SECTION 1.03. Terms Generally. The definitions of terms herein shall apply
equally to the singular and plural forms of the terms defined. Whenever the
context may require, any pronoun shall include the corresponding masculine,
feminine and neuter forms. The words “include”, “includes” and “including” shall
be deemed to be followed by the phrase “without limitation”. The word “law”
shall be construed as referring to all statutes, rules, regulations, codes and
other laws (including official rulings and interpretations thereunder having the
force of law or with which affected Persons customarily comply) and all
judgments, orders and decrees of all Governmental Authorities. The word “will”
shall be construed to have the same meaning and effect as the word “shall”.
Unless the context requires otherwise (a) any definition of or reference to any
agreement, instrument or other document herein shall be construed as referring
to such agreement, instrument or other document as from time to time amended,
restated, supplemented or otherwise modified (subject to any restrictions on
such amendments, restatements, supplements or modifications set forth herein),
(b) any definition of or reference to any statute, rule or regulation shall be
construed as referring thereto as from time to time amended, supplemented or
otherwise modified (including by succession of comparable successor laws), (c)
any reference herein to any Person shall be construed to include such Person’s
successors and assigns (subject to any restrictions on assignments set forth
herein) and, in the case of any Governmental Authority, any other Governmental
Authority that shall have succeeded to any or all functions thereof, (d) the
words “herein”, “hereof” and “hereunder”, and words of similar import, shall be
construed to refer to this Agreement in its entirety and not to any particular
provision hereof, (e) all references herein to Articles, Sections, Exhibits and
Schedules shall be construed to refer to Articles and Sections of, and Exhibits
and Schedules to, this Agreement, (f) any reference in any definition to the
phrase “at any time” or “for any period” shall refer to the same time or period
for all calculations or determinations within such definition, (g) the words
“asset” and “property” shall be construed to have the same meaning and effect
and to refer to any and all tangible and intangible assets and properties,
including cash, securities, accounts and contract rights and (h) any reference
to any IRS form shall be construed to include any successor form.

For purposes of any Collateral located in the Province of Quebec or charged by
any deed of hypothec (or any other Loan Document) and for all other purposes
pursuant to which the interpretation or construction of a Loan Document may be
subject to the laws of the Province of Quebec or a court or tribunal exercising
jurisdiction in the Province of Québec, (q) “personal property” shall be deemed
to include “movable property”, (r) “real property” shall be deemed to include
“immovable property”, (s) “tangible property” shall be deemed to include
“corporeal property”, (t) “intangible property” shall be deemed to include
“incorporeal property”, (u) “security interest” and “mortgage” shall be deemed
to include a “hypothec”, (v) all references to filing, registering or recording
under the UCC or the PPSA shall be deemed to include publication under the Civil
Code of Québec, (w) all references to “perfection” of or “perfected” Liens shall
be deemed to include a reference to the “opposability” of such Liens to third
parties, (x) any “right of offset”, “right of setoff” or similar expression
shall be deemed to include a “right of compensation”, (y) “goods” shall be
deemed to include “corporeal movable property” other than chattel paper,
documents of title, instruments, money and securities, and (z) an “agent” shall
be deemed to include a “mandatary”.

SECTION 1.04. Accounting Terms; GAAP. (a) Except as otherwise expressly provided
herein, all terms of an accounting or financial nature shall be construed in
accordance with GAAP, as in effect from time to time; provided that, if after
the date hereof there occurs any change in GAAP or in the application thereof on
the operation of any provision hereof and the Borrower Representative notifies
the Administrative Agent that the Borrowers request an amendment to any
provision hereof to eliminate the effect of such change in GAAP or in the
application thereof (or if the Administrative Agent notifies the Borrower
Representative that the Required Lenders request an amendment to any provision
hereof for

 

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such purpose), regardless of whether any such notice is given before or after
such change in GAAP or in the application thereof, then such provision shall be
interpreted on the basis of GAAP as in effect and applied immediately before
such change shall have become effective until such notice shall have been
withdrawn or such provision amended in accordance herewith. Notwithstanding any
other provision contained herein, all terms of an accounting or financial nature
used herein shall be construed, and all computations of amounts and ratios
referred to herein shall be made (i) without giving effect to any election under
Financial Accounting Standards Board Accounting Standards Codification 825-10-25
(or any other Accounting Standards Codification or Financial Accounting Standard
having a similar result or effect) to value any Indebtedness or other
liabilities of the Parent or any Subsidiary at “fair value”, as defined therein
and (ii) without giving effect to any treatment of Indebtedness in respect of
convertible debt instruments under Financial Accounting Standards Board
Accounting Standards Codification 470-20 (or any other Accounting Standards
Codification or Financial Accounting Standard having a similar result or effect)
to value any such Indebtedness in a reduced or bifurcated manner as described
therein, and such Indebtedness shall at all times be valued at the full stated
principal amount thereof.

(b) Notwithstanding anything to the contrary contained in Section 1.04(a) or in
the definition of “Capital Lease Obligations,” any change in accounting for
leases pursuant to GAAP resulting from the adoption of Financial Accounting
Standards Board Accounting Standards Update No. 2016-02, Leases (Topic 842), to
the extent such adoption would require treating any lease (or similar
arrangement conveying the right to use) as a capital lease where such lease (or
similar arrangement) would not have been required to be so treated under GAAP as
in effect on December 31, 2018, such lease shall not be considered a capital
lease, and all calculations and deliverables under this Agreement or any other
Loan Document shall be made or delivered, as applicable, in accordance
therewith.

SECTION 1.05. Interest Rates; LIBOR Notifications. The interest rate on
Eurodollar Loans is determined by reference to the LIBO Rate, which is derived
from the London interbank offered rate. The London interbank offered rate is
intended to represent the rate at which contributing banks may obtain short-term
borrowings from each other in the London interbank market. In July 2017, the
U.K. Financial Conduct Authority announced that, after the end of 2021, it would
no longer persuade or compel contributing banks to make rate submissions to the
ICE Benchmark Administration (together with any successor to the ICE Benchmark
Administrator, the “IBA”) for purposes of the IBA setting the London interbank
offered rate. As a result, it is possible that commencing in 2022, the London
interbank offered rate may no longer be available or may no longer be deemed an
appropriate reference rate upon which to determine the interest rate on
Eurodollar Loans. In light of this eventuality, public and private sector
industry initiatives are currently underway to identify new or alternative
reference rates to be used in place of the London interbank offered rate. In the
event that the London interbank offered rate is no longer available or in
certain other circumstances as set forth in Section 2.14(c) of this Agreement,
such Section 2.14(c) provides a mechanism for determining an alternative rate of
interest. The Administrative Agent will notify the Borrower Representative,
pursuant to Section 2.14, in advance of any change to the reference rate upon
which the interest rate on Eurodollar Loans is based. However, the
Administrative Agent does not warrant or accept any responsibility for, and
shall not have any liability with respect to, the administration, submission or
any other matter related to the London interbank offered rate or other rates in
the definition of “LIBO Rate” or with respect to any alternative or successor
rate thereto, or replacement rate thereof, including without limitation, whether
the composition or characteristics of any such alternative, successor or
replacement reference rate, as it may or may not be adjusted pursuant to
Section 2.14(c), will be similar to, or produce the same value or economic
equivalence of, the LIBO Rate or have the same volume or liquidity as did the
London interbank offered rate prior to its discontinuance or unavailability.

 

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SECTION 1.06. Pro Forma Calculations. (a) Notwithstanding anything to the
contrary herein, the Fixed Charge Coverage Ratio, Total Leverage Ratio and
Secured Leverage Ratio for purposes of any covenant herein shall be calculated
in the manner prescribed by this Section 1.06.

(b) In the event that since the beginning of the then most recent applicable
twelve fiscal month period ending prior to the date for which such Person’s
financial statements have been delivered (such applicable four fiscal quarter
period being the “Twelve Month Period”) the Parent or any of its Subsidiaries
has incurred any Indebtedness that remains outstanding or repaid, prepaid or
redeemed any Indebtedness (other than ordinary working capital borrowings), or
the transaction giving rise to the need to calculate the Fixed Charge Coverage
Ratio, Total Leverage Ratio or Secured Leverage Ratio is an incurrence or
repayment, prepayment or redemption of Indebtedness, Interest Expense, Total
Indebtedness, Secured Indebtedness and EBITDA for such period shall be
calculated after giving effect on a pro forma basis to such incurrence or
repayment, prepayment or redemption as if such Indebtedness was incurred or
repaid on the first day of such period, provided that, in the event of any such
repayment of Indebtedness, EBITDA for such period shall be calculated as if the
Parent or such Subsidiary had not earned any interest income actually earned
during such period in respect of the funds used to repay such Indebtedness.

(c) In the event that since the beginning of the Twelve Month Period the Parent
are then available (1) a Specified Transaction has occurred, (2) the transaction
giving rise to the need to calculate the Fixed Charge Coverage Ratio, Total
Leverage Ratio or Secured Leverage Ratio is such a Specified Transaction, or
(3) since the beginning of such period any Person (that subsequently became a
Subsidiary or was merged with or into the Parent or any Subsidiary since the
beginning of such period) shall have made such a Specified Transaction, EBITDA
for such period shall be calculated after giving pro forma effect to such
Specified Transactions as if such Specified Transactions occurred on the first
day of such period.

(d) Whenever pro forma effect is to be given to a Specified Transaction, the pro
forma calculations shall be determined in good faith by the Financial Officer of
the Parent and if cost savings and other operating expense reductions and
improvements have been realized with respect to such Specified Transaction or
are reasonably expected to be realized within twelve (12) months of such
Specified Transaction, such savings, reductions and improvements may be included
in the pro forma calculations to the extent permitted to be reflected in pro
forma financial statements under Article 11 of Regulation S-X promulgated by the
SEC, except that any such pro forma calculation may include cost savings and
other operating expense reductions and improvements for such period attributable
to such Specified Transaction (including, without limitation, cost savings and
other operating expense reductions and improvements attributable to execution or
termination of any contract, reduction of costs related to administrative
functions and networks, the termination of any employees or the closing of any
facility) that have been realized or for which all steps necessary for the
realization of which have been taken or are reasonably expected to be taken
within twelve (12) months following such transaction; provided, that (i) a
Financial Officer of the Parent shall deliver an officer’s certificate
certifying the amount of such adjustments and that such adjustments satisfy all
of the requirements set forth in this Section 1.06(d), (ii) the aggregate amount
of any such adjustments in any Twelve Month Period, when aggregated with all
amounts added back to Net Income in reliance on clauses (b)(v) and (b)(vi) of
the definition of EBITDA for such Twelve Month Period, shall not exceed fifteen
percent (15%) of EBITDA for such Twelve Month Period (calculated before giving
effect to any adjustments under this Section 1.06(d) and clauses (b)(v) and
(b)(vi) of the definition of EBITDA) and (iii) such adjustments shall be without
duplication of any costs, expenses or adjustments that are already included in
the calculation of EBITDA.

 

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SECTION 1.07. Status of Obligations.

(a) In the event that the Parent or any other Loan Party shall at any time issue
or have outstanding any Subordinated Indebtedness, the Parent shall take or
cause such other Loan Party to take all such actions as shall be necessary to
cause the Secured Obligations to constitute senior indebtedness (however
denominated) in respect of such Subordinated Indebtedness and to enable the
Administrative Agent and the Lenders to have and exercise any payment blockage
or other remedies available or potentially available to holders of senior
indebtedness under the terms of such Subordinated Indebtedness. Without limiting
the foregoing, the Secured Obligations are hereby designated as “senior
indebtedness” and as “designated senior indebtedness” and words of similar
import under and in respect of any indenture or other agreement or instrument
under which such Subordinated Indebtedness is outstanding and are further given
all such other designations as shall be required under the terms of any such
Subordinated Indebtedness in order that the Lenders may have and exercise any
payment blockage or other remedies available or potentially available to holders
of senior indebtedness under the terms of such Subordinated Indebtedness.

(b) For so long as the Senior Secured Notes Indenture is in effect, (i) the
Secured Obligations shall at all times constitute “ABL Obligations” under and as
defined therein and shall be permitted to exist under Section 4.09(b)(13))
thereof or any successor provision that is no more restrictive than such
Section, and (ii) the Liens on Collateral granted in favor of the Administrative
Agent for the benefit of itself and the Secured Parties pursuant to the
Collateral Documents shall be permitted to exist under clause (a)(1)(i)(B) of
the definition of “Permitted Liens” therein or any successor provisions that are
no more restrictive than such clause.

SECTION 1.08. Divisions. Any reference herein to (i) a transfer, assignment,
sale, conveyance or disposition, or similar term, shall be deemed to apply to a
division of or by a limited liability company, limited partnership or trust, or
an allocation of assets to a series of a limited liability company, limited
partnership or trust (a “Division”), as if it were a transfer, assignment, sale,
conveyance or disposition, or similar term, as applicable, to a separate Person,
and (ii) a merger, amalgamation or consolidation, or similar term, shall be
deemed to apply to a Division, or the unwinding of such a Division, as if it
were a merger, amalgamation or consolidation, or similar term, as applicable,
with a separate Person.

SECTION 1.09. Exchange Rates; Currency Equivalents.

(a) Without limiting the other terms of this Agreement, the calculations and
determinations under this Agreement of any amount in any currency other than
Dollars shall be deemed to refer to the Dollar Equivalent thereof, as the case
may be, and all Borrowing Base Certificates delivered under this Agreement shall
express such calculations or determinations in Dollars or the Dollar Equivalent
thereof, as the case may be. Each requisite currency translation shall be based
on the Spot Rate.

(b) For purposes of this Agreement and the other Loan Documents, the Dollar
Equivalent of the Borrowing Base any Obligations, if relevant, shall be
determined in accordance with the terms of this Agreement. Such Dollar
Equivalent shall become effective as of the revaluation date for the Borrowing
Base or any other Obligations and shall be the Dollar Equivalent employed in
converting any amounts between the applicable currencies until the next
revaluation date to occur for the Borrowing Base or other Obligations.

 

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ARTICLE II

The Credits

SECTION 2.01. Commitments. Subject to the terms and conditions set forth herein,
each Lender severally (and not jointly) agrees to make Revolving Loans in
dollars to the Borrowers from time to time during the Availability Period in an
aggregate principal amount that will not result in (i) such Lender’s Revolving
Exposure exceeding such Lender’s Revolving Commitment or (ii) the Aggregate
Revolving Exposure exceeding the lesser of (x) the Aggregate Revolving
Commitment minus the Applicable Ancillary Obligations Reserve and (y) the
Borrowing Base, subject to the Administrative Agent’s authority, in its sole
discretion, to make Protective Advances and Overadvances pursuant to the terms
of Sections 2.04 and 2.05. Within the foregoing limits and subject to the terms
and conditions set forth herein, the Borrowers may borrow, prepay and reborrow
Revolving Loans.

SECTION 2.02. Loans and Borrowings. (a) Each Loan (other than a Swingline Loan)
shall be made as part of a Borrowing consisting of Loans of the same Class and
Type made by the Lenders ratably in accordance with their respective Commitments
of the applicable Class. The failure of any Lender to make any Loan required to
be made by it shall not relieve any other Lender of its obligations hereunder;
provided that the Commitments of the Lenders are several and no Lender shall be
responsible for any other Lender’s failure to make Loans as required. Any
Protective Advance, any Overadvance and any Swingline Loan shall be made in
accordance with the procedures set forth in Sections 2.04 and 2.05.

(b) Subject to Section 2.14, each Revolving Borrowing shall be comprised
entirely of ABR Loans or Eurodollar Loans as the Borrower Representative may
request in accordance herewith, provided that all Borrowings made on the
Effective Date must be made as ABR Borrowings but may be converted into
Eurodollar Borrowings in accordance with Section 2.08. Each Swingline Loan shall
be an ABR Loan. Each Lender at its option may make any Eurodollar Loan by
causing any domestic or foreign branch or Affiliate of such Lender to make such
Loan (and in the case of an Affiliate, the provisions of Sections 2.14, 2.15,
2.16 and 2.17 shall apply to such Affiliate to the same extent as to such
Lender); provided that any exercise of such option shall not affect the
obligation of the Borrowers to repay such Loan in accordance with the terms of
this Agreement.

(c) At the commencement of each Interest Period for any Eurodollar Borrowing,
such Borrowing shall be in an aggregate amount that is an integral multiple of
$500,000 and not less than $1,000,000. ABR Borrowings may be in any amount.
Borrowings of more than one Type and Class may be outstanding at the same time;
provided that there shall not at any time be more than a total of 6 Eurodollar
Borrowings outstanding.

(d) Notwithstanding any other provision of this Agreement, the Borrower
Representative shall not be entitled to request, or to elect to convert or
continue, any Borrowing if the Interest Period requested with respect thereto
would end after the Maturity Date.

SECTION 2.03. Requests for Borrowings. To request a Borrowing, the Borrower
Representative shall notify the Administrative Agent of such request either in
writing (delivered by hand or fax) by delivering a Borrowing Request in
substantially the form of Exhibit B and signed by a Responsible Officer of the
Borrower Representative or through Electronic System if arrangements for doing
so have been approved by the Administrative Agent (or if an Extenuating
Circumstance shall exist, by telephone) not later than (a) in the case of a
Eurodollar Borrowing, 12:00p.m. Chicago time, three (3) Business Days before the
date of the proposed Borrowing or (b) in the case of an ABR Borrowing, 12:00p.m.
Chicago time, on the date of the proposed Borrowing; provided that any such
notice of an ABR Revolving Borrowing to finance the reimbursement of an LC
Disbursement as contemplated by Section 2.06(e) may be given not later than 9:00
a.m., Chicago time, on the date of such proposed Borrowing. Each such Borrowing
Request shall be irrevocable and each such telephonic Borrowing Request, if
permitted, shall be confirmed immediately upon the cessation of the Extenuating
Circumstance by hand delivery, facsimile or a communication through Electronic
System to the Administrative Agent of a written Borrowing Request substantially
in the form of Exhibit B and signed by a Responsible Officer of the Borrower
Representative. Each such written (or if permitted, telephonic) Borrowing
Request shall specify the following information:

(i) the name of the applicable Borrower(s);

 

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(ii) the aggregate amount of the requested Borrowing and a breakdown of the
separate wires comprising such Borrowing;

(iii) the date of such Borrowing, which shall be a Business Day;

(iv) whether such Borrowing is to be an ABR Borrowing or a Eurodollar Borrowing;
and

(v) in the case of a Eurodollar Borrowing, the initial Interest Period to be
applicable thereto, which shall be a period contemplated by the definition of
the term “Interest Period.”

If no election as to the Type of Borrowing is specified, then the requested
Borrowing shall be an ABR Borrowing. If no Interest Period is specified with
respect to any requested Eurodollar Borrowing, then the applicable Borrower(s)
shall be deemed to have selected an Interest Period of one month’s duration.
Promptly following receipt of a Borrowing Request in accordance with this
Section, the Administrative Agent shall advise each Lender of the details
thereof and of the amount of such Lender’s Loan to be made as part of the
requested Borrowing.

SECTION 2.04. Protective Advances. (a) Subject to the limitations set forth
below, the Administrative Agent is authorized by the Borrowers and the Lenders,
from time to time in the Administrative Agent’s sole discretion (but shall have
absolutely no obligation to), to make Loans to the Borrowers, on behalf of all
Lenders, which the Administrative Agent, in its Permitted Discretion, deems
necessary or desirable (i) to preserve or protect the Collateral, or any portion
thereof, (ii) to enhance the likelihood of, or maximize the amount of, repayment
of the Loans and other Obligations, or (iii) to pay any other amount chargeable
to or required to be paid by the Borrowers pursuant to the terms of this
Agreement, including payments of reimbursable expenses (including costs, fees,
and expenses as described in Section 9.03) and other sums payable under the Loan
Documents (any of such Loans are herein referred to as “Protective Advances”);
provided that, the aggregate amount of Protective Advances outstanding at any
time shall not at any time exceed the greater of (x) $3,000,000 and (y) 10% of
the sum of the Aggregate Revolving Exposure and Unfunded Commitments; provided
further that, the Aggregate Revolving Exposure after giving effect to the
Protective Advances being made shall not exceed the Aggregate Revolving
Commitment minus the Applicable Ancillary Obligations Reserve. Protective
Advances may be made even if the conditions precedent set forth in Section 4.02
have not been satisfied. The Protective Advances shall be secured by the Liens
in favor of the Administrative Agent in and to the Collateral and shall
constitute Obligations hereunder. All Protective Advances shall be ABR
Borrowings. The making of a Protective Advance on any one occasion shall not
obligate the Administrative Agent to make any Protective Advance on any other
occasion. The Administrative Agent’s authorization to make Protective Advances
may be revoked at any time by the Required Lenders. Any such revocation must be
in writing and shall become effective prospectively upon the Administrative
Agent’s receipt thereof. At any time that there is sufficient Availability and
the conditions precedent set forth in Section 4.02 have been satisfied, the
Administrative Agent may request the Revolving Lenders to make a Revolving Loan
to repay a Protective Advance. At any other time the Administrative Agent may
require the Lenders to fund their risk participations described in
Section 2.04(b).

 

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(b) Upon the making of a Protective Advance by the Administrative Agent (whether
before or after the occurrence of a Default), each Lender shall be deemed,
without further action by any party hereto, to have unconditionally and
irrevocably purchased from the Administrative Agent, without recourse or
warranty, an undivided interest and participation in such Protective Advance in
proportion to its Applicable Percentage. From and after the date, if any, on
which any Lender is required to fund its participation in any Protective Advance
purchased hereunder, the Administrative Agent shall promptly distribute to such
Lender, such Lender’s Applicable Percentage of all payments of principal and
interest and all proceeds of Collateral received by the Administrative Agent in
respect of such Protective Advance.

SECTION 2.05. Swingline Loans and Overadvances.

(a) The Administrative Agent, the Swingline Lender and the Revolving Lenders
agree that in order to facilitate the administration of this Agreement and the
other Loan Documents, promptly after the Borrower Representative requests an ABR
Borrowing, the Swingline Lender may elect to have the terms of this
Section 2.05(a) apply to such Borrowing Request by advancing, on behalf of the
Revolving Lenders and in the amount requested, same day funds to the Borrowers,
on the date of the applicable Borrowing to the Funding Account(s) (each such
Loan made solely by the Swingline Lender pursuant to this Section 2.05(a) is
referred to in this Agreement as a “Swingline Loan”), with settlement among them
as to the Swingline Loans to take place on a periodic basis as set forth in
Section 2.05(d). Each Swingline Loan shall be subject to all the terms and
conditions applicable to other ABR Loans funded by the Revolving Lenders, except
that all payments thereon shall be payable to the Swingline Lender solely for
its own account. In addition, the Borrowers hereby authorize the Swingline
Lender to, and the Swingline Lender may, subject to the terms and conditions set
forth herein (but without any further written notice required), not later than
1:00 p.m., Chicago time, on each Business Day, make available to the Borrowers
by means of a credit to the Funding Account(s), the proceeds of a Swingline Loan
to the extent necessary to pay items to be drawn on any Controlled Disbursement
Account that Business Day; provided that, if on any Business Day there is
insufficient borrowing capacity to permit the Swingline Lender to make available
to the Borrowers a Swingline Loan in the amount necessary to pay all items to be
so drawn on any such Controlled Disbursement Account on such Business Day, then
the Borrowers shall be deemed to have requested an ABR Borrowing pursuant to
Section 2.03 in the amount of such deficiency to be made on such Business Day.
In addition, the Borrowers hereby authorize the Swingline Lender to, and the
Swingline Lender shall, subject to the terms and conditions set forth herein
(but without any further written notice required), to the extent that from time
to time on any Business Day funds are required under the DDA Access Product to
reach the Target Balance (a “Deficiency Funding Date”), make available to the
applicable Borrower the proceeds of a Swingline Loan in the amount of such
deficiency up to the Target Balance, by means of a credit to the applicable
Funding Account on or before the start of business on the next succeeding
Business Day, and such Swingline Loan shall be deemed made on such Deficiency
Funding Date. The aggregate amount of Swingline Loans outstanding at any time
shall not exceed $5,000,000. The Swingline Lender shall not make any Swingline
Loan if the requested Swingline Loan exceeds Availability (before or after
giving effect to such Swingline Loan). All Swingline Loans shall be ABR
Borrowings.

(b) Any provision of this Agreement to the contrary notwithstanding, at the
request of the Borrower Representative, the Administrative Agent may in its sole
discretion (but with absolutely no obligation) and with the consent of the
Required Lenders, on behalf of the Revolving Lenders, (x) make Revolving Loans
to the Borrowers in amounts that exceed Availability (any such excess Revolving
Loans are herein referred to collectively as “Overadvances”) or (y) deem the
amount of Revolving Loans outstanding to the Borrowers that are in excess of
Availability to be Overadvances; provided that, no Overadvance shall result in a
Default due to Borrowers’ failure to comply with Section 2.01 for so long as
such Overadvance remains outstanding in accordance with the terms of this
paragraph, but solely with respect to the amount of such Overadvance. In
addition, Overadvances may be made even if the condition precedent set forth in
Section 4.02(c) has not been satisfied. All Overadvances shall constitute

 

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ABR Borrowings. The making of an Overadvance on any one occasion shall not
obligate the Administrative Agent to make any Overadvance on any other occasion.
The authority of the Administrative Agent to make Overadvances is limited to an
aggregate amount not to exceed the greater of $3,000,000 and 10% of the sum of
the Aggregate Revolving Exposure and Unfunded Commitments at such time at any
time, no Overadvance may remain outstanding beyond the date on which the
Administrative Agent makes demand for repayment thereof, and no Overadvance
shall cause any Revolving Lender’s Revolving Exposure to exceed its Revolving
Commitment; provided that, the Required Lenders may at any time revoke the
Administrative Agent’s authorization to make Overadvances. Any such revocation
must be in writing and shall become effective prospectively upon the
Administrative Agent’s receipt thereof.

(c) Upon the making of a Swingline Loan or an Overadvance (whether before or
after the occurrence of a Default and regardless of whether a Settlement has
been requested with respect to such Swingline Loan or Overadvance), each
Revolving Lender shall be deemed, without further action by any party hereto, to
have unconditionally and irrevocably purchased from the Swingline Lender or the
Administrative Agent, as the case may be, without recourse or warranty, an
undivided interest and participation in such Swingline Loan or Overadvance in
proportion to its Applicable Percentage of the Revolving Commitment. The
Swingline Lender or the Administrative Agent, as applicable, may, at any time,
require the Revolving Lenders to fund their participations. From and after the
date, if any, on which any Revolving Lender is required to fund its
participation in any Swingline Loan or Overadvance purchased hereunder, the
Administrative Agent shall promptly distribute to such Lender, such Lender’s
Applicable Percentage of all payments of principal and interest and all proceeds
of Collateral received by the Administrative Agent in respect of such Swingline
Loan or Overadvance.

(d) The Administrative Agent, on behalf of the Swingline Lender, shall request
settlement (a “Settlement”) with the Revolving Lenders on at least a weekly
basis or on any date that the Administrative Agent elects, by notifying the
Revolving Lenders of such requested Settlement by facsimile, telephone, or
e-mail no later than 12:00 noon Chicago time on the date of such requested
Settlement (the “Settlement Date”). Each Revolving Lender (other than the
Swingline Lender, in the case of the Swingline Loans) shall transfer the amount
of such Revolving Lender’s Applicable Percentage of the outstanding principal
amount of the applicable Loan with respect to which Settlement is requested to
the Administrative Agent, to such account of the Administrative Agent as the
Administrative Agent may designate, not later than 2:00 p.m., Chicago time, on
such Settlement Date. Settlements may occur during the existence of a Default
and whether or not the applicable conditions precedent set forth in Section 4.02
have then been satisfied. Such amounts transferred to the Administrative Agent
shall be applied against the amounts of the Swingline Lender’s Swingline Loans
and, together with Swingline Lender’s Applicable Percentage of such Swingline
Loan, shall constitute Revolving Loans of such Revolving Lenders, respectively.
If any such amount is not transferred to the Administrative Agent by any
Revolving Lender on such Settlement Date, the Swingline Lender shall be entitled
to recover from such Lender on demand such amount, together with interest
thereon, as specified in Section 2.07.

SECTION 2.06. Letters of Credit. (a) General. Subject to the terms and
conditions set forth herein, the Borrower Representative may request the
issuance of Letters of Credit for its own account or for the account of another
Borrower denominated in dollars as the applicant thereof for the support of its
or its Subsidiaries’ obligations, in a form reasonably acceptable to the
Administrative Agent and the Issuing Bank, at any time and from time to time
during the Availability Period and the Issuing Bank may, but shall have no
obligation, to issue such requested Letters of Credit pursuant to this
Agreement. In the event of any inconsistency between the terms and conditions of
this Agreement and the terms and conditions of any Letter of Credit Agreement,
the terms and conditions of this Agreement shall control. Notwithstanding
anything herein to the contrary, the Issuing Bank shall have no obligation
hereunder to issue, and shall not issue, any Letter of Credit (i) the proceeds
of which would be made available to any

 

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Person (A) to fund any activity or business of or with any Sanctioned Person, or
in any country or territory that, at the time of such funding, is the subject of
any Sanctions or (B) in any manner that would result in a violation of any
Sanctions by any party to this Agreement, (ii) if any order, judgment or decree
of any Governmental Authority or arbitrator shall by its terms purport to enjoin
or restrain the Issuing Bank from issuing such Letter of Credit, or any
Requirement of Law relating to the Issuing Bank or any request or directive
(whether or not having the force of law) from any Governmental Authority with
jurisdiction over the Issuing Bank shall prohibit, or request that the Issuing
Bank refrain from, the issuance of letters of credit generally or such Letter of
Credit in particular or shall impose upon the Issuing Bank with respect to such
Letter of Credit any restriction, reserve or capital requirement (for which the
Issuing Bank is not otherwise compensated hereunder) not in effect on the
Effective Date, or shall impose upon the Issuing Bank any unreimbursed loss,
cost or expense which was not applicable on the Effective Date and which the
Issuing Bank in good faith deems material to it, or (iii) if the issuance of
such Letter of Credit would violate one or more policies of the Issuing Bank
applicable to letters of credit generally; provided that, notwithstanding
anything herein to the contrary, (x) the Dodd-Frank Wall Street Reform and
Consumer Protection Act and all requests, rules, guidelines, requirements or
directives thereunder or issued in connection therewith or in the implementation
thereof, and (y) all requests, rules, guidelines, requirements or directives
promulgated by the Bank for International Settlements, the Basel Committee on
Banking Supervision (or any successor or similar authority) or the United States
or foreign regulatory authorities, in each case pursuant to Basel III, shall in
each case be deemed not to be in effect on the Effective Date for purposes of
clause (ii) above, regardless of the date enacted, adopted, issued or
implemented.

(b) Notice of Issuance, Amendment, Renewal, Extension; Certain Conditions. To
request the issuance of a Letter of Credit (or the amendment, renewal or
extension of an outstanding Letter of Credit), the Borrower Representative shall
deliver by hand or facsimile (or transmit through Electronic System, if
arrangements for doing so have been approved by the Issuing Bank) to the Issuing
Bank and the Administrative Agent (reasonably in advance of, but in any event no
less than three (3) Business Days prior (or such shorter period as may be agreed
by the Administrative Agent and such Issuing Bank in its reasonable discretion)
to the requested date of issuance, amendment, renewal or extension) a notice
requesting the issuance of a Letter of Credit, or identifying the Letter of
Credit to be amended, renewed or extended, and specifying the date of issuance,
amendment, renewal or extension (which shall be a Business Day), the date on
which such Letter of Credit is to expire (which shall comply with paragraph
(c) of this Section), the amount of such Letter of Credit, the name and address
of the beneficiary thereof and such other information as shall be necessary to
prepare, amend, renew or extend such Letter of Credit. In addition, as a
condition to any such Letter of Credit issuance, the applicable Borrower shall
have entered into a continuing agreement (or other letter of credit agreement)
for the issuance of letters of credit and/or shall submit a letter of credit
application in each case, as required by the Issuing Bank and using such Issuing
Bank’s standard form (each, a “Letter of Credit Agreement”). A Letter of Credit
shall be issued, amended, renewed or extended only if (and upon issuance,
amendment, renewal or extension of each Letter of Credit the Borrowers shall be
deemed to represent and warrant that), after giving effect to such issuance,
amendment, renewal or extension (i) the aggregate LC Exposure shall not exceed
$5,000,000, (ii) no Revolving Lender’s Revolving Exposure shall exceed its
Revolving Commitment and (iii) the Aggregate Revolving Exposure shall not exceed
the lesser of the Aggregate Revolving Commitment and the Borrowing Base.

(c) Expiration Date. Each Letter of Credit shall expire (or be subject to
termination or non-renewal by notice from the Issuing Bank to the beneficiary
thereof) at or prior to the close of business on the earlier of (i) the date one
year after the date of the issuance of such Letter of Credit (or, in the case of
any renewal or extension thereof, including, without limitation, any automatic
renewal provision, one year after such renewal or extension) and (ii) the date
that is five Business Days prior to the Maturity Date.

 

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(d) Participations. By the issuance of a Letter of Credit (or an amendment to a
Letter of Credit increasing the amount thereof) and without any further action
on the part of the Issuing Bank or the Revolving Lenders, the Issuing Bank
hereby grants to each Revolving Lender, and each Revolving Lender hereby
acquires from the Issuing Bank, a participation in such Letter of Credit equal
to such Lender’s Applicable Percentage of the aggregate amount available to be
drawn under such Letter of Credit. In consideration and in furtherance of the
foregoing, each Revolving Lender hereby absolutely and unconditionally agrees to
pay to the Administrative Agent, for the account of the Issuing Bank, such
Lender’s Applicable Percentage of each LC Disbursement made by the Issuing Bank
and not reimbursed by the Borrowers on the date due as provided in paragraph
(e) of this Section, or of any reimbursement payment required to be refunded to
the Borrowers for any reason. Each Revolving Lender acknowledges and agrees that
its obligation to acquire participations pursuant to this paragraph in respect
of Letters of Credit is absolute and unconditional and shall not be affected by
any circumstance whatsoever, including any amendment, renewal or extension of
any Letter of Credit or the occurrence and continuance of a Default or reduction
or termination of the Commitments, and that each such payment shall be made
without any offset, abatement, withholding or reduction whatsoever.

(e) Reimbursement. If the Issuing Bank shall make any LC Disbursement in respect
of a Letter of Credit, the Borrowers shall reimburse such LC Disbursement by
paying to the Administrative Agent an amount equal to such LC Disbursement not
later than 11:00 a.m., Chicago time, on (a) (i) the Business Day that the
Borrower Representative receives notice of such LC Disbursement, if such notice
is received prior to 9:00 a.m., Chicago time, on the day of receipt, or (ii) the
Business Day immediately following the day that the Borrower Representative
receives such notice, if such notice is received after 9:00a.m. Chicago time on
the day of receipt; provided that the Borrowers may, subject to the conditions
to borrowing set forth herein, request in accordance with Section 2.03 or 2.05
that such payment be financed with an ABR Revolving Borrowing or Swingline Loan
in an equivalent amount and, to the extent so financed, the Borrowers’
obligation to make such payment shall be discharged and replaced by the
resulting ABR Revolving Borrowing or Swingline Loan. If the Borrowers fail to
make such payment when due, the Administrative Agent shall notify each Revolving
Lender of the applicable LC Disbursement, the payment then due from the
Borrowers in respect thereof and such Lender’s Applicable Percentage thereof.
Promptly following receipt of such notice, each Revolving Lender shall pay to
the Administrative Agent its Applicable Percentage of the payment then due from
the Borrowers, in the same manner as provided in Section 2.07 with respect to
Loans made by such Lender (and Section 2.07 shall apply, mutatis mutandis, to
the payment obligations of the Revolving Lenders), and the Administrative Agent
shall promptly pay to the Issuing Bank the amounts so received by it from the
Revolving Lenders. Promptly following receipt by the Administrative Agent of any
payment from the Borrowers pursuant to this paragraph, the Administrative Agent
shall distribute such payment to the Issuing Bank or, to the extent that
Revolving Lenders have made payments pursuant to this paragraph to reimburse the
Issuing Bank, then to such Lenders and the Issuing Bank as their interests may
appear. Any payment made by a Revolving Lender pursuant to this paragraph to
reimburse the Issuing Bank for any LC Disbursement (other than the funding of
ABR Revolving Loans or a Swingline Loan as contemplated above) shall not
constitute a Loan and shall not relieve the Borrowers of their obligation to
reimburse such LC Disbursement.

(f) Obligations Absolute. The Borrowers’ joint and several obligation to
reimburse LC Disbursements as provided in paragraph (e) of this Section shall be
absolute, unconditional and irrevocable, and shall be performed strictly in
accordance with the terms of this Agreement under any and all circumstances
whatsoever and irrespective of (i) any lack of validity or enforceability of any
Letter of Credit, any Letter of Credit Agreement or this Agreement, or any term
or provision therein or herein, (ii) any draft or other document presented under
a Letter of Credit proving to be forged, fraudulent or invalid in any respect or
any statement therein being untrue or inaccurate in any respect, (iii) any
payment by the Issuing Bank under a Letter of Credit against presentation of a
draft or other document that does

 

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not comply with the terms of such Letter of Credit, or (iv) any other event or
circumstance whatsoever, whether or not similar to any of the foregoing, that
might, but for the provisions of this Section, constitute a legal or equitable
discharge of, or provide a right of setoff against, the Borrowers’ obligations
hereunder. None of the Administrative Agent, the Revolving Lenders, the Issuing
Bank or any of their respective Related Parties, shall have any liability or
responsibility by reason of or in connection with the issuance or transfer of
any Letter of Credit or any payment or failure to make any payment thereunder
(irrespective of any of the circumstances referred to in the preceding
sentence), or any error, omission, interruption, loss or delay in transmission
or delivery of any draft, notice or other communication under or relating to any
Letter of Credit (including any document required to make a drawing thereunder),
any error in interpretation of technical terms or any consequence arising from
causes beyond the control of the Issuing Bank; provided that the foregoing shall
not be construed to excuse the Issuing Bank from liability to the Borrowers to
the extent of any direct damages (as opposed to special, indirect, consequential
or punitive damages, claims in respect of which are hereby waived by the
Borrowers to the extent permitted by applicable law) suffered by any Borrower
that are caused by the Issuing Bank’s failure to exercise care when determining
whether drafts and other documents presented under a Letter of Credit comply
with the terms thereof. The parties hereto expressly agree that, in the absence
of gross negligence or willful misconduct on the part of the Issuing Bank (as
finally determined by a court of competent jurisdiction), the Issuing Bank shall
be deemed to have exercised care in each such determination. In furtherance of
the foregoing and without limiting the generality thereof, the parties agree
that, with respect to documents presented which appear on their face to be in
substantial compliance with the terms of a Letter of Credit, the Issuing Bank
may, in its sole discretion, either accept and make payment upon such documents
without responsibility for further investigation, regardless of any notice or
information to the contrary, or refuse to accept and make payment upon such
documents if such documents are not in strict compliance with the terms of such
Letter of Credit.

(g) Disbursement Procedures. The Issuing Bank shall, promptly following its
receipt thereof, examine all documents purporting to represent a demand for
payment under a Letter of Credit. The Issuing Bank shall promptly notify the
Administrative Agent and the applicable Borrower by telephone (confirmed by fax
or through Electronic Systems) of such demand for payment and whether the
Issuing Bank has made or will make an LC Disbursement thereunder; provided that
any failure to give or delay in giving such notice shall not relieve the
Borrowers of their obligation to reimburse the Issuing Bank and the Revolving
Lenders with respect to any such LC Disbursement.

(h) Interim Interest. If the Issuing Bank shall make any LC Disbursement, then,
unless the Borrowers shall reimburse such LC Disbursement in full on the date
such LC Disbursement is made, the unpaid amount thereof shall bear interest, for
each day from and including the date such LC Disbursement is made to but
excluding the date that the Borrowers reimburse such LC Disbursement, at the
rate per annum then applicable to ABR Revolving Loans and such interest shall be
payable on the date when such reimbursement is due; provided that, if the
Borrowers fail to reimburse such LC Disbursement when due pursuant to paragraph
(e) of this Section, then Section 2.13(d) shall apply. Interest accrued pursuant
to this paragraph shall be for the account of the Issuing Bank, except that
interest accrued on and after the date of payment by any Revolving Lender
pursuant to paragraph (e) of this Section to reimburse the Issuing Bank shall be
for the account of such Lender to the extent of such payment.

(i) Replacement and Resignation of an Issuing Bank. (i) The Issuing Bank may be
replaced at any time by written agreement among the Borrower Representative, the
Administrative Agent, the replaced Issuing Bank and the successor Issuing Bank.
The Administrative Agent shall notify the Revolving Lenders of any such
replacement of the Issuing Bank. At the time any such replacement shall become
effective, the Borrowers shall pay all unpaid fees accrued for the account of
the replaced Issuing Bank pursuant to Section 2.12(b). From and after the
effective date of any such replacement, (A) the successor Issuing Bank shall
have all the rights and obligations of the Issuing Bank under this Agreement

 

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with respect to Letters of Credit to be issued thereafter and (B) references
herein to the term “Issuing Bank” shall be deemed to refer to such successor or
to any previous Issuing Bank, or to such successor and all previous Issuing
Banks, as the context shall require. After the replacement of an Issuing Bank
hereunder, the replaced Issuing Bank shall remain a party hereto and shall
continue to have all the rights and obligations of an Issuing Bank under this
Agreement with respect to Letters of Credit then outstanding and issued by it
prior to such replacement, but shall not be required to issue additional Letters
of Credit.

(ii) Subject to the appointment and acceptance of a successor Issuing Bank, the
Issuing Bank may resign as an Issuing Bank at any time upon thirty days’ prior
written notice to the Administrative Agent, the Borrower Representative and the
Lenders, in which case, such resigning Issuing Bank shall be replaced in
accordance with clause (i) of Section 2.06(i) above.

(j) Cash Collateralization. If any Event of Default shall occur and be
continuing, on the Business Day that the Borrower Representative receives notice
from the Administrative Agent or the Required Lenders (or, if the maturity of
the Loans has been accelerated, Revolving Lenders with LC Exposure representing
greater than 50% of the aggregate LC Exposure) demanding the deposit of cash
collateral pursuant to this paragraph, the Borrowers shall deposit in an account
with the Administrative Agent, in the name of the Administrative Agent and for
the benefit of the Revolving Lenders (the “LC Collateral Account”), an amount in
cash equal to 103% of the amount of the LC Exposure as of such date plus accrued
and unpaid interest thereon; provided that the obligation to deposit such cash
collateral shall become effective immediately, and such deposit shall become
immediately due and payable, without demand or other notice of any kind, upon
the occurrence of any Event of Default with respect to any Borrower described in
clause (h) or (i) of Article VII. Such Borrower also shall deposit cash
collateral in accordance with this paragraph as and to the extent required by
Sections 2.10(b), 2.11(b) or 2.20. Each such deposit shall be held by the
Administrative Agent as collateral for the payment and performance of the
Secured Obligations. The Administrative Agent shall have exclusive dominion and
control, including the exclusive right of withdrawal, over the LC Collateral
Account and the Borrowers hereby grant the Administrative Agent a security
interest in the LC Collateral Account and all money or other assets on deposit
therein or credited thereto. Other than any interest earned on the investment of
such deposits, which investments shall be made at the option and sole discretion
of the Administrative Agent and at the Borrowers’ risk and expense, such
deposits shall not bear interest. Interest or profits, if any, on such
investments shall accumulate in the LC Collateral Account. Moneys in the LC
Collateral Account shall be applied by the Administrative Agent to reimburse the
Issuing Bank for LC Disbursements for which it has not been reimbursed and, to
the extent not so applied, shall be held for the satisfaction of the
reimbursement obligations of the Borrowers for the LC Exposure at such time or,
if the maturity of the Loans has been accelerated (but subject to the consent of
Revolving Lenders with LC Exposure representing greater than 50% of the
aggregate LC Exposure), be applied to satisfy other Secured Obligations. If the
Borrowers are required to provide an amount of cash collateral hereunder as a
result of the occurrence of an Event of Default or Cash Dominion Period pursuant
to Section 2.10(b), such amount (to the extent not applied as aforesaid) shall
be returned to the Borrowers within three (3) Business Days after all such
Events of Default have been cured or waived or such Cash Dominion Period is no
longer in existence as confirmed in writing by the Administrative Agent.

(k) Issuing Bank Reports to the Administrative Agent. Unless otherwise agreed by
the Administrative Agent, each Issuing Bank shall, in addition to its
notification obligations set forth elsewhere in this Section, report in writing
to the Administrative Agent (i) periodic activity (for such period or recurrent
periods as shall be requested by the Administrative Agent) in respect of Letters
of Credit issued by such Issuing Bank, including all issuances, extensions,
amendments and renewals, all expirations and cancelations and all disbursements
and reimbursements, (ii) reasonably prior to the time that such Issuing Bank
issues, amends, renews or extends any Letter of Credit, the date of such
issuance,

 

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amendment, renewal or extension, and the stated amount of the Letters of Credit
issued, amended, renewed or extended by it and outstanding after giving effect
to such issuance, amendment, renewal or extension (and whether the amounts
thereof shall have changed), (iii) on each Business Day on which such Issuing
Bank makes any LC Disbursement, the date and amount of such LC Disbursement,
(iv) on any Business Day on which any Borrower fails to reimburse an LC
Disbursement required to be reimbursed to such Issuing Bank on such day, the
date of such failure and the amount of such LC Disbursement, and (v) on any
other Business Day, such other information as the Administrative Agent shall
reasonably request as to the Letters of Credit issued by such Issuing Bank.

(l) LC Exposure Determination. For all purposes of this Agreement, the amount of
a Letter of Credit that, by its terms or the terms of any document related
thereto, provides for one or more automatic increases in the stated amount
thereof shall be deemed to be the maximum stated amount of such Letter of Credit
after giving effect to all such increases, whether or not such maximum stated
amount is in effect at the time of determination.

(m) Letters of Credit Issued for Account of Subsidiaries. Notwithstanding that a
Letter of Credit issued or outstanding hereunder supports any obligations of, or
is for the account of, the Parent or a Subsidiary, or states that the Parent or
a Subsidiary is the “account party,” “applicant,” “customer,” “instructing
party,” or the like of or for such Letter of Credit, and without derogating from
any rights of the Issuing Bank (whether arising by contract, at law, in equity
or otherwise) against the Parent or such Subsidiary in respect of such Letter of
Credit, the Borrowers (i) shall reimburse, indemnify and compensate the Issuing
Bank hereunder for such Letter of Credit (including to reimburse any and all
drawings thereunder) as if such Letter of Credit had been issued solely for the
account of a Borrower and (ii) irrevocably waives to the fullest extent
permitted by applicable law any and all defenses that might otherwise be
available to it as a guarantor or surety of any or all of the obligations of the
Parent or such Subsidiary in respect of such Letter of Credit. Each Borrower
hereby acknowledges that the issuance of such Letters of Credit for the Parent
or its Subsidiaries inures to the benefit of the Borrowers, and that each
Borrower’s business derives substantial benefits from the businesses of the
Parent or such Subsidiaries.

SECTION 2.07. Funding of Borrowings. (a) Each Lender shall make each Loan to be
made by such Lender hereunder on the proposed date thereof solely by wire
transfer of immediately available funds by 2:00 p.m., Chicago time, to the
account of the Administrative Agent most recently designated by it for such
purpose by notice to the Lenders in an amount equal to such Lender’s Applicable
Percentage; provided that Swingline Loans shall be made as provided in
Section 2.05. The Administrative Agent will make such Loans available to the
Borrower Representative by promptly crediting the funds so received in the
aforesaid account of the Administrative Agent to the Funding Account; provided
that ABR Revolving Loans made to finance the reimbursement of (i) an LC
Disbursement as provided in Section 2.06(e) shall be remitted by the
Administrative Agent to the Issuing Bank and (ii) a Protective Advance or an
Overadvance shall be retained by the Administrative Agent.

(b) Unless the Administrative Agent shall have received notice from a Lender
prior to the proposed date of any Borrowing that such Lender will not make
available to the Administrative Agent such Lender’s share of such Borrowing, the
Administrative Agent may assume that such Lender has made such share available
on such date in accordance with paragraph (a) of this Section and may, in
reliance upon such assumption, make available to the applicable Borrower a
corresponding amount. In such event, if a Lender has not in fact made its share
of the applicable Borrowing available to the Administrative Agent, then the
applicable Lender and the Borrowers each severally agree to pay to the
Administrative Agent forthwith on demand such corresponding amount with interest
thereon, for each day from and including the date such amount is made available
to the applicable Borrower to but excluding the date of payment to the
Administrative Agent, at (i) in the case of such Lender, the greater of the

 

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NYFRB Rate and a rate determined by the Administrative Agent in accordance with
banking industry rules on interbank compensation and (ii) in the case of the
Borrowers, the interest rate applicable to ABR Loans. If such Lender pays such
amount to the Administrative Agent, then such amount shall constitute such
Lender’s Loan included in such Borrowing, provided, that any interest received
from a Borrower by the Administrative Agent during the period beginning when
Administrative Agent funded the Borrowing until such Lender pays such amount
shall be solely for the account of the Administrative Agent.

SECTION 2.08. Interest Elections. (a) Each Borrowing initially shall be of the
Type specified in the applicable Borrowing Request and, in the case of a
Eurodollar Borrowing, shall have an initial Interest Period as specified in such
Borrowing Request. Thereafter, the Borrower Representative may elect to convert
such Borrowing to a different Type or to continue such Borrowing and, in the
case of a Eurodollar Borrowing, may elect Interest Periods therefor, all as
provided in this Section. The Borrower Representative may elect different
options with respect to different portions of the affected Borrowing, in which
case each such portion shall be allocated ratably among the Lenders holding the
Loans comprising such Borrowing, and the Loans comprising each such portion
shall be considered a separate Borrowing. This Section shall not apply to
Swingline Borrowings, Overadvances or Protective Advances, which may not be
converted or continued.

(b) To make an election pursuant to this Section, the Borrower Representative
shall notify the Administrative Agent of such election either in writing
(delivered by hand or fax) by delivering an Interest Election Request signed by
a Responsible Officer of the Borrower Representative or through Electronic
System if arrangements for doing so have been approved by the Administrative
Agent (or if an Extenuating Circumstance shall exist, by telephone) by the time
that a Borrowing Request would be required under Section 2.03 if the Borrowers
were requesting a Borrowing of the Type resulting from such election to be made
on the effective date of such election. Each such Interest Election Request
shall be irrevocable and each such telephonic Interest Election Request, if
permitted, shall be confirmed immediately upon the cessation of the Extenuating
Circumstance by hand delivery, Electronic System or facsimile to the
Administrative Agent of a written Interest Election Request substantially in the
form of Exhibit G and signed by a Responsible Officer of the Borrower
Representative.

(c) Each written (or if permitted, telephonic) Interest Election Request
(including requests submitted through Electronic System) shall specify the
following information in compliance with Section 2.02:

(i) the name of the applicable Borrower and the Borrowing to which such Interest
Election Request applies and, if different options are being elected with
respect to different portions thereof, the portions thereof to be allocated to
each resulting Borrowing (in which case the information to be specified pursuant
to clauses (iii) and (iv) below shall be specified for each resulting
Borrowing);

(ii) the effective date of the election made pursuant to such Interest Election
Request, which shall be a Business Day;

(iii) whether the resulting Borrowing is to be an ABR Borrowing or a Eurodollar
Borrowing; and

(iv) if the resulting Borrowing is a Eurodollar Borrowing, the Interest Period
to be applicable thereto after giving effect to such election, which shall be a
period contemplated by the definition of the term “Interest Period”.

 

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If any such Interest Election Request requests a Eurodollar Borrowing but does
not specify an Interest Period, then the Borrowers shall be deemed to have
selected an Interest Period of one month’s duration.

(d) Promptly following receipt of an Interest Election Request, the
Administrative Agent shall advise each Lender of the details thereof and of such
Lender’s portion of each resulting Borrowing.

(e) If the Borrower Representative fails to deliver a timely Interest Election
Request with respect to a Eurodollar Borrowing prior to the end of the Interest
Period applicable thereto, then, unless such Borrowing is repaid as provided
herein, at the end of such Interest Period such Borrowing shall be converted to
an ABR Borrowing. Notwithstanding any contrary provision hereof, if an Event of
Default has occurred and is continuing and the Administrative Agent, at the
request of the Required Lenders, so notifies the Borrower Representative, then,
so long as an Event of Default is continuing (i) no outstanding Borrowing may be
converted to or continued as a Eurodollar Borrowing and (ii) unless repaid, each
Eurodollar Borrowing shall be converted to an ABR Borrowing at the end of the
Interest Period applicable thereto.

SECTION 2.09. Termination and Reduction of Commitments; Increase in Revolving
Commitments. (a) The Revolving Commitments shall terminate on the Maturity Date.

(b) The Borrowers may at any time terminate the Revolving Commitments upon the
Payment in Full of the Secured Obligations.

(c) The Borrowers may from time to time reduce the Revolving Commitments;
provided that (i) each reduction of the Revolving Commitments shall be in an
amount that is an integral multiple of $1,000,000 and not less than $5,000,000
and (ii) the Borrowers shall not terminate or reduce the Revolving Commitments
if, after giving effect to any concurrent prepayment of the Revolving Loans in
accordance with Section 2.11, the Aggregate Revolving Exposure would exceed the
lesser of the Aggregate Revolving Commitment and the Borrowing Base.

(d) The Borrower Representative shall notify the Administrative Agent of any
election to terminate or reduce the Commitments under paragraph (b) or (c) of
this Section at least three (3) Business Days prior to the effective date of
such termination or reduction, specifying such election and the effective date
thereof. Promptly following receipt of any notice, the Administrative Agent
shall advise the Lenders of the contents thereof. Each notice delivered by the
Borrower Representative pursuant to this Section shall be irrevocable; provided
that a notice of termination of the Commitments delivered by the Borrower
Representative may state that such notice is conditioned upon the effectiveness
of other credit facilities, in which case such notice may be revoked by the
Borrower Representative (by notice to the Administrative Agent on or prior to
the specified effective date) if such condition is not satisfied. Any
termination or reduction of the Commitments shall be permanent. Each reduction
of the Commitments shall be made ratably among the Lenders in accordance with
their respective Commitments.

(e) The Borrowers shall have the right to increase the Revolving Commitments by
obtaining additional Revolving Commitments, either from one or more of the
Lenders or another lending institution provided that (i) any such request for an
increase shall be in a minimum amount of $5,000,000, (ii) the Borrower
Representative, on behalf of the Borrowers, may make a maximum of 3 such
requests, (iii) after giving effect thereto, the sum of the total of the
additional Commitments does not exceed the lesser of (1) $30,000,000 and (2) the
maximum amount of Indebtedness permitted to be incurred under the Senior Secured
Notes Indenture (or any other Indebtedness by which the Parent and its
Subsidiaries are bound) on the same terms and having the same Collateral and
Lien priority as the then existing Revolving Loans, (iv) the Administrative
Agent and the Issuing Bank have approved the identity of any such new Lender,
such approvals not to be unreasonably withheld, (v) any such new Lender assumes
all of the rights and obligations of a “Lender” hereunder, and (vi) the
procedure described in Section 2.09(f) have been satisfied. Nothing contained in
this Section 2.09 shall constitute, or otherwise be deemed to be, a commitment
on the part of any Lender to increase its Commitment hereunder at any time.

 

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(f) Any amendment hereto for such an increase or addition shall be in form and
substance reasonably satisfactory to the Administrative Agent and shall only
require the written signatures of the Administrative Agent, the Borrowers and
each Lender being added or increasing its Revolving Commitment. As a condition
precedent to such an increase or addition, the Borrowers shall deliver to the
Administrative Agent (i) a certificate of each Loan Party signed by an
authorized officer of such Loan Party (A) certifying and attaching the
resolutions adopted by such Loan Party approving or consenting to such increase,
and (B) in the case of the Borrowers, certifying that, before and after giving
effect to such increase or addition, (1) the representations and warranties
contained in Article III and the other Loan Documents are true and correct in
all material respects (or in all respects in the case of any representation or
warranty which is subject to any materiality qualifier, including Material
Adverse Effect), except to the extent that such representations and warranties
specifically refer to an earlier date, in which case they are true and correct
in all material respects (or all respects, as applicable) as of such earlier
date, (2) no Default exists and (3) the Borrowers are in compliance (on a pro
forma basis) with the covenant contained in Section 6.13 if compliance would be
required at such time after giving pro forma effect to such increased Revolving
Commitments and the actual or intended use of proceeds thereunder, and
(ii) legal opinions and documents consistent with those delivered on the
Effective Date, to the extent requested by the Administrative Agent.

(g) On the effective date of any such increase or addition, (i) any Lender
increasing (or, in the case of any newly added Lender, extending) its Revolving
Commitment shall make available to the Administrative Agent such amounts in
immediately available funds as the Administrative Agent shall determine, for the
benefit of the other Lenders, as being required in order to cause, after giving
effect to such increase or addition and the use of such amounts to make payments
to such other Lenders, each Lender’s portion of the outstanding Revolving Loans
of all the Lenders to equal its revised Applicable Percentage of such
outstanding Revolving Loans, and the Administrative Agent shall make such other
adjustments among the Lenders with respect to the Revolving Loans then
outstanding and amounts of principal, interest, commitment fees and other
amounts paid or payable with respect thereto as shall be necessary, in the
opinion of the Administrative Agent, in order to effect such reallocation and
(ii) the Borrowers shall be deemed to have repaid and reborrowed all outstanding
Revolving Loans as of the date of any increase (or addition) in the Revolving
Commitments (with such reborrowing to consist of the Types of Revolving Loans,
with related Interest Periods if applicable, specified in a notice delivered by
the Borrower Representative, in accordance with the requirements of
Section 2.03). The deemed payments made pursuant to clause (ii) of the
immediately preceding sentence shall be accompanied by payment of all accrued
interest on the amount prepaid and, in respect of each Eurodollar Loan, shall be
subject to indemnification by the Borrowers pursuant to the provisions of
Section 2.16 if the deemed payment occurs other than on the last day of the
related Interest Periods. Within a reasonable time after the effective date of
any increase or addition, the Administrative Agent shall, and is hereby
authorized and directed to, revise the Commitment Schedule to reflect such
increase or addition and shall distribute such revised Commitment Schedule to
each of the Lenders and the Borrower Representative, whereupon such revised
Commitment Schedule shall replace the old Commitment Schedule and become part of
this Agreement.

SECTION 2.10. Repayment and Amortization of Loans; Evidence of Debt. (a) The
Borrowers hereby unconditionally promise to pay (i) to the Administrative Agent
for the account of each Revolving Lender the then unpaid principal amount of
each Revolving Loan on the Maturity Date, (ii) to the Administrative Agent the
then unpaid amount of each Protective Advance on the earlier of the Maturity
Date and demand by the Administrative Agent, and (iii) to the Administrative
Agent the then unpaid principal amount of each Overadvance on the earlier of the
Maturity Date and demand by the Administrative Agent.

 

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(b) At all during the Cash Dominion Period, on each Business Day, the
Administrative Agent shall apply all funds credited to the Collateral Account on
the immediately preceding Business Day (at the discretion of the Administrative
Agent, whether or not immediately available) first to prepay any Protective
Advances and Overadvances that may be outstanding, pro rata, and second to
prepay the Revolving Loans (including Swingline Loans) and to cash collateralize
outstanding LC Exposure.

(c) Each Lender shall maintain in accordance with its usual practice an account
or accounts evidencing the Indebtedness of the Borrowers to such Lender
resulting from each Loan made by such Lender, including the amounts of principal
and interest payable and paid to such Lender from time to time hereunder.

(d) The Administrative Agent shall maintain accounts in which it shall record
(i) the amount of each Loan made hereunder, the Class and Type thereof and the
Interest Period applicable thereto, (ii) the amount of any principal or interest
due and payable or to become due and payable from the Borrowers to each Lender
hereunder and (iii) the amount of any sum received by the Administrative Agent
hereunder for the account of the Lenders and each Lender’s share thereof.

(e) The entries made in the accounts maintained pursuant to paragraph (c) or (d)
of this Section shall be prima facie evidence of the existence and amounts of
the obligations recorded therein; provided that the failure of any Lender or the
Administrative Agent to maintain such accounts or any error therein shall not in
any manner affect the obligation of the Borrowers to repay the Loans in
accordance with the terms of this Agreement.

(f) Any Lender may request that Loans made by it be evidenced by a promissory
note. In such event, the Borrowers shall prepare, execute and deliver to such
Lender a promissory note payable to such Lender (or, if requested by such
Lender, to such Lender and its registered assigns) and in a form approved by the
Administrative Agent and the Borrowers. Thereafter, the Loans evidenced by such
promissory note and interest thereon shall at all times (including after
assignment pursuant to Section 9.04) be represented by one or more promissory
notes in such form.

SECTION 2.11. Prepayment of Loans. (a) The Borrowers shall have the right at any
time and from time to time to prepay any Borrowing in whole or in part, subject
to prior notice in accordance with paragraph (f) of this Section and, if
applicable, payment of any break funding expenses under Section 2.16.

(b) Except for Overadvances permitted under Section 2.05, in the event and on
such occasion that the Aggregate Revolving Exposure exceeds the lesser of
(i) the Aggregate Revolving Commitment and (ii) the Borrowing Base, the
Borrowers shall prepay the Revolving Loans, LC Exposure and/or Swingline Loans
or cash collateralize LC Exposure in an account with the Administrative Agent
pursuant to Section 2.06(j), as applicable, in an aggregate amount equal to such
excess.

(c) The Borrower Representative shall notify the Administrative Agent (and, in
the case of prepayment of a Swingline Loan, the Swingline Lender) by telephone
(confirmed by fax) or through Electronic System, if arrangements for doing so
have been approved by the Administrative Agent, of any prepayment hereunder not
later than 10:00 a.m., Chicago time, (A) in the case of prepayment of a
Eurodollar Revolving Borrowing, three (3) Business Days before the date of
prepayment, or (B) in the case of prepayment of an ABR Revolving Borrowing, on
the date of prepayment. Each such notice shall be irrevocable and shall specify
the prepayment date and the principal amount of each Borrowing or

 

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portion thereof to be prepaid; provided that, if a notice of prepayment is given
in connection with a conditional notice of termination of the Revolving
Commitments as contemplated by Section 2.09, then such notice of prepayment may
be revoked if such notice of termination is revoked in accordance with
Section 2.09. Promptly following receipt of any such notice relating to a
Revolving Borrowing, the Administrative Agent shall advise the Lenders of the
contents thereof. Each partial prepayment of any Revolving Borrowing shall be in
an amount that would be permitted in the case of an advance of a Revolving
Borrowing of the same Type as provided in Section 2.02. Each prepayment of a
Revolving Borrowing shall be applied ratably to the Revolving Loans included in
the prepaid Borrowing. Prepayments shall be accompanied by (i) accrued interest
to the extent required by Section 2.13 and (ii) break funding payments pursuant
to Section 2.16.

(d) Section 2.11(b) above shall be subject to the provisions of any applicable
Intercreditor Agreement with respect to the application of proceeds of any
Collateral other than ABL Priority Collateral.

SECTION 2.12. Fees. (a) The Borrowers agree to pay to the Administrative Agent
for the account of each Lender a commitment fee, which shall accrue at the
Applicable Rate applicable thereto on the average daily amount of the Available
Revolving Commitment of such Lender during the period from and including the
Effective Date to but excluding the date on which the Revolving Commitments
terminate. Accrued commitment fees shall be payable in arrears on the first
Business Day of each calendar month and on the date on which the Revolving
Commitments terminate, commencing on the first such date to occur after the date
hereof. All commitment fees shall be computed on the basis of a year of 360 days
and shall be payable for the actual number of days elapsed (including the first
day but excluding the last day).

(b) The Borrowers agree to pay (i) to the Administrative Agent for the account
of each Revolving Lender a participation fee with respect to its participations
in Letters of Credit, which shall accrue at the same Applicable Rate used to
determine the interest rate applicable to Eurodollar Revolving Loans on the
average daily amount of such Lender’s LC Exposure (excluding any portion thereof
attributable to unreimbursed LC Disbursements) during the period from and
including the Effective Date to but excluding the later of the date on which
such Lender’s Revolving Commitment terminates and the date on which such Lender
ceases to have any LC Exposure, and (ii) to the Issuing Bank a fronting fee,
which shall accrue at the rate of 0.125% per annum on the average daily amount
of the LC Exposure (excluding any portion thereof attributable to unreimbursed
LC Disbursements) attributable to Letters of Credit issued by the Issuing Bank
during the period from and including the Effective Date to but excluding the
later of the date of termination of the Revolving Commitments and the date on
which there ceases to be any LC Exposure, as well as the Issuing Bank’s standard
fees and commissions with respect to the issuance, amendment, cancellation,
negotiation, transfer, presentment, renewal or extension of any Letter of Credit
or processing of drawings thereunder. Participation fees and fronting fees
accrued through and including the last day of each calendar month shall be
payable on the first Business Day of each calendar month following such last
day, commencing on the first such date to occur after the Effective Date;
provided that all such fees shall be payable on the date on which the Revolving
Commitments terminate and any such fees accruing after the date on which the
Revolving Commitments terminate shall be payable on demand. Any other fees
payable to the Issuing Bank pursuant to this paragraph shall be payable within
ten (10) days after demand. All participation fees and fronting fees shall be
computed on the basis of a year of 360 days and shall be payable for the actual
number of days elapsed (including the first day but excluding the last day).

(c) The Borrowers agree to pay to the Administrative Agent, for its own account,
fees payable in the amounts and at the times separately agreed upon between the
Borrowers and the Administrative Agent.

 

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(d) All fees payable hereunder shall be paid on the dates due, in dollars in
immediately available funds, to the Administrative Agent (or to the Issuing
Bank, in the case of fees payable to it) for distribution, in the case of
commitment fees and participation fees, to the Lenders. Fees paid shall not be
refundable under any circumstances.

SECTION 2.13. Interest. (a) The Loans comprising ABR Borrowings (including
Swingline Loans) shall bear interest at the ABR plus the Applicable Rate for
Revolving Loans.

(b) The Loans comprising each Eurodollar Borrowing shall bear interest at the
Adjusted LIBO Rate for the Interest Period in effect for such Borrowing plus the
Applicable Rate for Revolving Loans.

(c) Each Protective Advance and each Overadvance shall bear interest at the ABR
plus the Applicable Rate for Revolving Loans plus 2%.

(d) Notwithstanding the foregoing, if any principal of or interest on any Loan
other than a Protective Advance or any fee or other amount payable by the
Borrowers hereunder is not paid when due, whether at stated maturity, by
mandatory prepayment, upon acceleration or otherwise, such overdue amount shall
bear interest, after as well as before judgment, at a rate per annum equal to
(i) in the case of overdue principal of any Loan, 2% plus the rate otherwise
applicable to such Loan as provided in the preceding paragraphs of this Section
or (ii) in the case of any other amount, 2% plus the rate applicable to ABR
Revolving Loans as provided in paragraph (a) of this Section.

(e) Accrued interest on each Loan (for ABR Loans, accrued through the last day
of the prior calendar month) shall be payable in arrears on each Interest
Payment Date for such Loan and upon termination of the Commitments; provided
that (i) interest accrued pursuant to paragraph (d) of this Section shall be
payable on demand, (ii) in the event of any repayment or prepayment of any Loan
(other than a prepayment of an ABR Revolving Loan prior to the end of the
Availability Period), accrued interest on the principal amount repaid or prepaid
shall be payable on the date of such repayment or prepayment and (iii) in the
event of any conversion of any Eurodollar Loan prior to the end of the current
Interest Period therefor, accrued interest on such Loan shall be payable on the
effective date of such conversion.

(f) All interest hereunder shall be computed on the basis of a year of 360 days,
except that interest computed by reference to the Alternate Base Rate shall be
computed on the basis of a year of 365 days (or 366 days in a leap year), and in
each case shall be payable for the actual number of days elapsed (including the
first day but excluding the last day). The applicable Alternate Base Rate,
Adjusted LIBO Rate or LIBO Rate shall be determined by the Administrative Agent,
and such determination shall be conclusive absent manifest error.

(g) For purposes of disclosure pursuant to the Interest Act, R.S.C. 1985, c.
I-15, the annual rates of interest or fees to which the rates of interest or
fees provided in this Agreement and the other Loan Documents (and stated herein
or therein, as applicable, to be computed on the basis of 360 days or any other
period of time less than a calendar year) are equivalent are the rates so
determined multiplied by the actual number of days in the applicable calendar
year and divided by 360 or such other period of time, respectively.

 

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SECTION 2.14. Alternate Rate of Interest; Illegality.

(a) If prior to the commencement of any Interest Period for a Eurodollar
Borrowing:

(i) the Administrative Agent determines (which determination shall be conclusive
and binding absent manifest error) that adequate and reasonable means do not
exist for ascertaining the Adjusted LIBO Rate or the LIBO Rate, as applicable
(including, without limitation, by means of an Interpolated Rate or because the
LIBO Screen Rate is not available or published on a current basis) for such
Interest Period; or

(ii) the Administrative Agent is advised by the Required Lenders that the
Adjusted LIBO Rate or the LIBO Rate, as applicable, for such Interest Period
will not adequately and fairly reflect the cost to such Lenders (or Lender) of
making or maintaining their Loans (or its Loan) included in such Borrowing for
such Interest Period;

then the Administrative Agent shall give notice thereof to the Borrower
Representative and the Lenders through Electronic System as provided in
Section 9.01 as promptly as practicable thereafter and, until the Administrative
Agent notifies the Borrower Representative and the Lenders that the
circumstances giving rise to such notice no longer exist, (A) any Interest
Election Request that requests the conversion of any Borrowing to, or
continuation of any Borrowing as, a Eurodollar Borrowing shall be ineffective
and any such Eurodollar Borrowing shall be repaid or converted into an ABR
Borrowing on the last day of the then current Interest Period applicable
thereto, and (B) if any Borrowing Request requests a Eurodollar Borrowing, such
Borrowing shall be made as an ABR Borrowing.

(b) If any Lender determines that any Requirement of Law has made it unlawful,
or if any Governmental Authority has asserted that it is unlawful, for any
Lender or its applicable lending office to make, maintain, fund or continue any
Eurodollar Borrowing, or any Governmental Authority has imposed material
restrictions on the authority of such Lender to purchase or sell, or to take
deposits of, dollars in the London interbank market, then, on notice thereof by
such Lender to the Borrower Representative through the Administrative Agent, any
obligations of such Lender to make, maintain, fund or continue Eurodollar Loans
or to convert ABR Borrowings to Eurodollar Borrowings will be suspended until
such Lender notifies the Administrative Agent and the Borrower Representative
that the circumstances giving rise to such determination no longer exist. Upon
receipt of such notice, the Borrowers will upon demand from such Lender (with a
copy to the Administrative Agent), either convert or prepay all Eurodollar
Borrowings of such Lender to ABR Borrowings, either on the last day of the
Interest Period therefor, if such Lender may lawfully continue to maintain such
Eurodollar Borrowings to such day, or immediately, if such Lender may not
lawfully continue to maintain such Loans. Upon any such conversion or
prepayment, the Borrowers will also pay accrued interest on the amount so
converted or prepaid.

(c) If at any time the Administrative Agent determines (which determination
shall be conclusive absent manifest error) that (i) the circumstances set forth
in clause (a)(i) have arisen and such circumstances are unlikely to be temporary
or (ii) the circumstances set forth in clause (a)(i) have not arisen but either
(w) the supervisor for the administrator of the LIBO Screen Rate has made a
public statement that the administrator of the LIBO Screen Rate is insolvent
(and there is no successor administrator that will continue publication of the
LIBO Screen Rate), (x) the administrator of the LIBO Screen Rate has made a
public statement identifying a specific date after which the LIBO Screen Rate
will permanently or indefinitely cease to be published by it (and there is no
successor administrator that will continue publication of the LIBO Screen Rate),
(y) the supervisor for the administrator of the LIBO Screen Rate has made a
public statement identifying a specific date after which the LIBO Screen Rate
will permanently or indefinitely cease to be published or (z) the supervisor for
the administrator of the LIBO Screen Rate or a Governmental Authority having
jurisdiction over the Administrative Agent has made a public statement
identifying a specific date after which the LIBO Screen Rate may no longer be
used for determining interest rates for loans, then the Administrative Agent and
the Borrower Representative shall endeavor to establish an alternate rate of
interest to the LIBO Rate that gives due consideration to the then prevailing
market convention for determining a rate of interest for syndicated

 

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loans in the United States at such time, and shall enter into an amendment to
this Agreement to reflect such alternate rate of interest and such other related
changes to this Agreement as may be applicable (but for the avoidance of doubt,
such related changes shall not include a reduction of the Applicable Rate).
Notwithstanding anything to the contrary in Section 9.02, such amendment shall
become effective without any further action or consent of any other party to
this Agreement so long as the Administrative Agent shall not have received,
within five (5) Business Days of the date notice of such alternate rate of
interest is provided to the Lenders, a written notice from the Required Lenders
stating that such Required Lenders object to such amendment. Until an alternate
rate of interest shall be determined in accordance with this clause (c) (but, in
the case of the circumstances described in clause (ii)(w), clause (ii)(x) or
clause (ii)(y) of the first sentence of this Section 2.14(c), only to the extent
the LIBO Screen Rate for such Interest Period is not available or published at
such time on a current basis), (x) any Interest Election Request that requests
the conversion of any Borrowing to, or continuation of any Borrowing as, a
Eurodollar Borrowing shall be ineffective and any such Eurodollar Borrowing
shall be repaid or converted into an ABR Borrowing on the last day of the then
current Interest Period applicable thereto, and (y) if any Borrowing Request
requests a Eurodollar Borrowing, such Borrowing shall be made as an ABR
Borrowing; provided that, if such alternate rate of interest shall be less than
zero, such rate shall be deemed to be zero for the purposes of this Agreement.

SECTION 2.15. Increased Costs. (a) If any Change in Law shall:

(i) impose, modify or deem applicable any reserve, special deposit, liquidity or
similar requirement (including any compulsory loan requirement, insurance charge
or other assessment) against assets of, deposits with or for the account of, or
credit extended by, any Lender (except any such reserve requirement reflected in
the Adjusted LIBO Rate or any Tax) or the Issuing Bank;

(ii) impose on any Lender or the Issuing Bank or the London interbank market any
other condition, cost or expense (other than Taxes) affecting this Agreement or
Loans made by such Lender or any Letter of Credit or participation therein; or

(iii) subject any Recipient to any Taxes (other than (A) Indemnified Taxes,
(B) Taxes described in clauses (b) through (d) of the definition of Excluded
Taxes and (C) Connection Income Taxes) on its loans, loan principal, letters of
credit, commitments, or other obligations, or its deposits, reserves, other
liabilities or capital attributable thereto;

and the result of any of the foregoing shall be to increase the cost to such
Lender or such other Recipient of making, continuing, converting into or
maintaining any Loan (or of maintaining its obligation to make any such Loan) or
to increase the cost to such Lender, the Issuing Bank or such other Recipient of
participating in, issuing or maintaining any Letter of Credit or to reduce the
amount of any sum received or receivable by such Lender, the Issuing Bank or
such other Recipient hereunder (whether of principal, interest or otherwise),
then the Borrowers will pay to such Lender, the Issuing Bank or such other
Recipient, as the case may be, such additional amount or amounts as will
compensate such Lender, the Issuing Bank or such other Recipient, as the case
may be, for such additional costs incurred or reduction suffered.

(b) If any Lender or the Issuing Bank determines that any Change in Law
regarding capital or liquidity requirements has or would have the effect of
reducing the rate of return on such Lender’s or the Issuing Bank’s capital or on
the capital of such Lender’s or the Issuing Bank’s holding company, if any, as a
consequence of this Agreement, the Commitments of, or the Loans made by, or
participations in Letters of Credit or Swingline Loans held by, such Lender, or
the Letters of Credit issued by the Issuing Bank, to a level below that which
such Lender or the Issuing Bank or such Lender’s or the Issuing Bank’s

 

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holding company could have achieved but for such Change in Law (taking into
consideration such Lender’s or the Issuing Bank’s policies and the policies of
such Lender’s or the Issuing Bank’s holding company with respect to capital
adequacy and liquidity), then from time to time the Borrowers will pay to such
Lender or the Issuing Bank, as the case may be, such additional amount or
amounts as will compensate such Lender or the Issuing Bank or such Lender’s or
the Issuing Bank’s holding company for any such reduction suffered.

(c) A certificate of a Lender or the Issuing Bank setting forth the amount or
amounts necessary to compensate such Lender or the Issuing Bank or its holding
company, as the case may be, as specified in paragraph (a) or (b) of this
Section shall be delivered to the Borrower Representative and shall be
conclusive absent manifest error. The Borrowers shall pay such Lender or the
Issuing Bank, as the case may be, the amount shown as due on any such
certificate within ten (10) days after receipt thereof.

(d) Failure or delay on the part of any Lender or the Issuing Bank to demand
compensation pursuant to this Section shall not constitute a waiver of such
Lender’s or the Issuing Bank’s right to demand such compensation; provided that
the Borrowers shall not be required to compensate a Lender or the Issuing Bank
pursuant to this Section for any increased costs or reductions incurred more
than 270 days prior to the date that such Lender or the Issuing Bank, as the
case may be, notifies the Borrower Representative of the Change in Law giving
rise to such increased costs or reductions and of such Lender’s or the Issuing
Bank’s intention to claim compensation therefor; provided further that, if the
Change in Law giving rise to such increased costs or reductions is retroactive,
then the 270-day period referred to above shall be extended to include the
period of retroactive effect thereof.

SECTION 2.16. Break Funding Payments. In the event of (a) the payment of any
principal of any Eurodollar Loan prior to the last day of an Interest Period
applicable thereto (including as a result of an Event of Default or as a result
of any prepayment pursuant to Section 2.11), (b) the conversion of any
Eurodollar Loan prior to the last day of the Interest Period applicable thereto,
(c) the failure to borrow, convert, continue or prepay any Eurodollar Loan on
the date specified in any notice delivered pursuant hereto (regardless of
whether such notice may be revoked under Section 2.09(d) and is revoked in
accordance therewith), or (d) the assignment of any Eurodollar Loan prior to the
last day of the Interest Period applicable thereto as a result of a request by
the Borrower Representative pursuant to Section 2.19 or 9.02(d), then, in any
such event, the Borrowers shall compensate each Lender for the loss, cost and
expense attributable to such event. In the case of a Eurodollar Loan, such loss,
cost or expense to any Lender shall be deemed to include an amount determined by
such Lender to be the excess, if any, of (i) the amount of interest which would
have accrued on the principal amount of such Eurodollar Loan had such event not
occurred, at the Adjusted LIBO Rate that would have been applicable to such
Eurodollar Loan, for the period from the date of such event to the last day of
the then current Interest Period therefor (or, in the case of a failure to
borrow, convert or continue, for the period that would have been the Interest
Period for such Eurodollar Loan), over (ii) the amount of interest which would
accrue on such principal amount for such period at the interest rate which such
Lender would bid were it to bid, at the commencement of such period, for dollar
deposits of a comparable amount and period from other banks in the eurodollar
market. A certificate of any Lender setting forth any amount or amounts that
such Lender is entitled to receive pursuant to this Section shall be delivered
to the Borrower Representative and shall be conclusive absent manifest error.
The Borrowers shall pay such Lender the amount shown as due on any such
certificate within ten (10) days after receipt thereof.

SECTION 2.17. Withholding of Taxes; Gross-Up. (a) Payments Free of Taxes. Any
and all payments by or on account of any obligation of any Loan Party under any
Loan Document shall be made without deduction or withholding for any Taxes,
except as required by applicable law. If any applicable law (as determined in
the good faith discretion of an applicable withholding agent) requires the
deduction

 

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or withholding of any Tax from any such payment by a withholding agent, then the
applicable withholding agent shall be entitled to make such deduction or
withholding and shall timely pay the full amount deducted or withheld to the
relevant Governmental Authority in accordance with applicable law and, if such
Tax is an Indemnified Tax, then the amount so payable by the applicable Loan
Party shall be increased as necessary so that after such deduction or
withholding has been made (including such deductions and withholdings applicable
to additional amounts payable under this Section 2.17) the applicable Recipient
receives an amount equal to the amount it would have received had no such
deduction or withholding been made.

(b) Payment of Other Taxes by the Loan Parties. The Loan Parties shall timely
pay to the relevant Governmental Authority in accordance with applicable law, or
at the option of the Administrative Agent timely reimburse it for, Other Taxes,
in each case, within ten (10) days after demand therefor.

(c) Evidence of Payment. As soon as practicable after any payment of Taxes by
any Loan Party to a Governmental Authority pursuant to this Section 2.17, such
Loan Party shall deliver to the Administrative Agent the original or a certified
copy of a receipt issued by such Governmental Authority evidencing such payment,
a copy of the return reporting such payment or other evidence of such payment
reasonably satisfactory to the Administrative Agent.

(d) Indemnification by the Loan Parties. The Loan Parties shall jointly and
severally indemnify each Recipient, within ten (10) days after demand therefor,
for the full amount of any Indemnified Taxes (including Indemnified Taxes
imposed or asserted on or attributable to amounts payable under this Section)
payable or paid by such Recipient or required to be withheld or deducted from a
payment to such Recipient and any reasonable expenses arising therefrom or with
respect thereto, whether or not such Indemnified Taxes were correctly or legally
imposed or asserted by the relevant Governmental Authority. A certificate as to
the amount of such payment or liability delivered to any Loan Party by a Lender
(with a copy to the Administrative Agent), or by the Administrative Agent on its
own behalf or on behalf of a Lender, shall be conclusive absent manifest error.

(e) Indemnification by the Lenders. Each Lender shall severally indemnify the
Administrative Agent, within ten (10) days after demand therefor, for (i) any
Indemnified Taxes attributable to such Lender (but only to the extent that any
Loan Party has not already indemnified the Administrative Agent for such
Indemnified Taxes and without limiting the obligation of the Loan Parties to do
so), (ii) any Taxes attributable to such Lender’s failure to comply with the
provisions of Section 9.04(c) relating to the maintenance of a Participant
Register and (iii) any Excluded Taxes attributable to such Lender, in each case,
that are payable or paid by the Administrative Agent in connection with any Loan
Document, and any reasonable expenses arising therefrom or with respect thereto,
whether or not such Taxes were correctly or legally imposed or asserted by the
relevant Governmental Authority. A certificate as to the amount of such payment
or liability delivered to any Lender by the Administrative Agent shall be
conclusive absent manifest error. Each Lender hereby authorizes the
Administrative Agent to setoff and apply any and all amounts at any time owing
to such Lender under any Loan Document or otherwise payable by the
Administrative Agent to such Lender from any other source against any amount due
to the Administrative Agent under this paragraph (e).

(f) Status of Lenders. (i) Any Lender that is entitled to an exemption from or
reduction of withholding Tax with respect to payments made under any Loan
Document shall deliver to the Borrower Representative and the Administrative
Agent, at the time or times reasonably requested by the Borrower Representative
or the Administrative Agent, such properly completed and executed documentation
reasonably requested by the Borrower Representative or the Administrative Agent
as will permit such payments to be made without withholding or at a reduced rate
of withholding. In addition, any Lender, if

 

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reasonably requested by the Borrower Representative or the Administrative Agent,
shall deliver such other documentation prescribed by applicable law or
reasonably requested by the Borrower Representative or the Administrative Agent
as will enable the Borrowers or the Administrative Agent to determine whether or
not such Lender is subject to backup withholding or information reporting
requirements. Notwithstanding anything to the contrary in the preceding two
sentences, the completion, execution and submission of such documentation (other
than such documentation set forth in Section 2.17(f)(ii)(A), (ii)(B) and (ii)(D)
below) shall not be required if in the Lender’s reasonable judgment such
completion, execution or submission would subject such Lender to any material
unreimbursed cost or expense or would materially prejudice the legal or
commercial position of such Lender.

(ii) Without limiting the generality of the foregoing,

(A) any Lender that is a U.S. Person shall deliver to the Borrower
Representative and the Administrative Agent on or prior to the date on which
such Lender becomes a Lender under this Agreement (and from time to time
thereafter upon the reasonable request of the Borrower Representative or the
Administrative Agent), an executed copy of IRS Form W-9 certifying that such
Lender is exempt from U.S. federal backup withholding tax;

(B) any Foreign Lender shall, to the extent it is legally entitled to do so,
deliver to the Borrower Representative and the Administrative Agent (in such
number of copies as shall be requested by the recipient) on or prior to the date
on which such Foreign Lender becomes a Lender under this Agreement (and from
time to time thereafter upon the reasonable request of the Borrower
Representative or the Administrative Agent), whichever of the following is
applicable:

(1) in the case of a Foreign Lender claiming the benefits of an income tax
treaty to which the United States is a party (x) with respect to payments of
interest under any Loan Document, an executed copy of IRS Form W-8BEN or IRS
Form W-8BEN-E, as applicable, establishing an exemption from, or reduction of,
U.S. federal withholding Tax pursuant to the “interest” article of such tax
treaty and (y) with respect to any other applicable payments under any Loan
Document, IRS Form W-8BEN or IRS Form W-8BEN-E, as applicable, establishing an
exemption from, or reduction of, U.S. Federal withholding Tax pursuant to the
“business profits” or “other income” article of such tax treaty;

(2) in the case of a Foreign Lender claiming that its extension of credit will
generate U.S. effectively connected income, an executed copy of IRS Form W-8ECI;

(3) in the case of a Foreign Lender claiming the benefits of the exemption for
portfolio interest under Section 881(c) of the Code, (x) a certificate
substantially in the form of Exhibit C-1 to the effect that such Foreign Lender
is not a “bank” within the meaning of Section 881(c)(3)(A) of the Code, a
“10 percent shareholder” of a Borrower within the meaning of
Section 881(c)(3)(B) of the Code, or a “controlled foreign corporation”
described in Section 881(c)(3)(C) of the Code (a “U.S. Tax Compliance
Certificate”) and (y) an executed copy of IRS Form W-8BEN or IRS Form W-8BEN-E,
as applicable; or

(4) to the extent a Foreign Lender is not the beneficial owner, an executed copy
of IRS Form W-8IMY, accompanied by IRS Form W-8ECI, IRS Form W-8BEN or IRS Form
W-8BEN-E, as applicable, a U.S. Tax Compliance Certificate substantially in the
form of Exhibit C-2 or Exhibit C-3, IRS Form W-9, and/or other certification

 

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documents from each beneficial owner, as applicable; provided that if the
Foreign Lender is a partnership and one or more direct or indirect partners of
such Foreign Lender are claiming the portfolio interest exemption, such Foreign
Lender may provide a U.S. Tax Compliance Certificate substantially in the form
of Exhibit C-4 on behalf of each such direct and indirect partner;

(C) any Lender shall, to the extent it is legally entitled to do so, deliver to
the Borrower Representative and the Administrative Agent (in such number of
copies as shall be requested by the recipient) on or prior to the date on which
such Lender becomes a Lender under this Agreement (and from time to time
thereafter upon the reasonable request of the Borrower Representative or the
Administrative Agent), executed copies of any other form prescribed by
applicable law as a basis for claiming exemption from or a reduction in U.S.
federal withholding Tax, duly completed, together with such supplementary
documentation as may be prescribed by applicable law to permit the Borrowers or
the Administrative Agent to determine the withholding or deduction required to
be made; and

(D) if a payment made to a Lender under any Loan Document would be subject to
U.S. Federal withholding Tax imposed by FATCA if such Lender were to fail to
comply with the applicable reporting requirements of FATCA (including those
contained in Section 1471(b) or 1472(b) of the Code, as applicable), such Lender
shall deliver to the Borrower Representative and the Administrative Agent at the
time or times prescribed by law and at such time or times reasonably requested
by the Borrower Representative or the Administrative Agent such documentation
prescribed by applicable law (including as prescribed by
Section 1471(b)(3)(C)(i) of the Code) and such additional documentation
reasonably requested by the Borrower Representative or the Administrative Agent
as may be necessary for the Borrowers and the Administrative Agent to comply
with their obligations under FATCA and to determine that such Lender has
complied with such Lender’s obligations under FATCA or to determine the amount
to deduct and withhold from such payment. Solely for purposes of this clause
(D), “FATCA” shall include any amendments made to FATCA after the date of this
Agreement.

Each Lender agrees that if any form or certification it previously delivered
expires or becomes obsolete or inaccurate in any respect, it shall update such
form or certification or promptly notify the Borrower Representative and the
Administrative Agent in writing of its legal inability to do so.

(g) Treatment of Certain Refunds. If any party determines, in its sole
discretion exercised in good faith, that it has received a refund of any Taxes
as to which it has been indemnified pursuant to this Section (including by the
payment of additional amounts pursuant to this Section) or Section 2.15, it
shall pay to the indemnifying party an amount equal to such refund (but only to
the extent of indemnity payments made under this Section or Section 2.15 with
respect to the Taxes giving rise to such refund), net of all out-of-pocket
expenses (including Taxes) of such indemnified party and without interest (other
than any interest paid by the relevant Governmental Authority with respect to
such refund). Such indemnifying party, upon the request of such indemnified
party, shall repay to such indemnified party the amount paid over pursuant to
this paragraph (g) (plus any penalties, interest or other charges imposed by the
relevant Governmental Authority) in the event that such indemnified party is
required to repay such refund to such Governmental Authority. Notwithstanding
anything to the contrary in this paragraph (g), in no event will the indemnified
party be required to pay any amount to an indemnifying party pursuant to this
paragraph (g) the payment of which would place the indemnified party in a less
favorable net after-Tax position than the indemnified party would have been in
if the Tax subject to indemnification and giving rise to such refund had not
been deducted, withheld or otherwise imposed and the indemnification payments or
additional amounts giving rise to such refund had never been paid. This
paragraph (g) shall not be construed to require any indemnified party to make
available its Tax returns (or any other information relating to its Taxes that
it deems confidential) to the indemnifying party or any other Person.

 

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(h) Survival. Each party’s obligations under this Section shall survive the
resignation or replacement of the Administrative Agent or any assignment of
rights by, or the replacement of, a Lender, the termination of the Commitments
and the repayment, satisfaction or discharge of all obligations under any Loan
Document (including the Payment in Full of the Secured Obligations).

(i) Defined Terms. For purposes of this Section 2.17, the term “Lender” includes
any Issuing Bank and the term “applicable law” includes FATCA.

SECTION 2.18. Payments Generally; Allocation of Proceeds; Sharing of Setoffs.
(a) The Borrowers shall make each payment or prepayment required to be made by
them hereunder (whether of principal, interest, fees or reimbursement of LC
Disbursements, or of amounts payable under Section 2.15, 2.16 or 2.17, or
otherwise) prior to 2:00 p.m., Chicago time, on the date when due or the date
fixed for any prepayment hereunder, in immediately available funds, without
setoff, recoupment or counterclaim. Any amounts received after such time on any
date may, in the discretion of the Administrative Agent, be deemed to have been
received on the next succeeding Business Day for purposes of calculating
interest thereon. All such payments shall be made to the Administrative Agent at
its offices at 10 South Dearborn Street, Floor L2, Chicago, Illinois, except
payments to be made directly to the Issuing Bank or Swingline Lender as
expressly provided herein and except that payments pursuant to Sections 2.15,
2.16, 2.17 and 9.03 shall be made directly to the Persons entitled thereto. The
Administrative Agent shall distribute any such payments received by it for the
account of any other Person to the appropriate recipient promptly following
receipt thereof. Unless otherwise provided for herein, if any payment hereunder
shall be due on a day that is not a Business Day, the date for payment shall be
extended to the next succeeding Business Day, and, in the case of any payment
accruing interest, interest thereon shall be payable for the period of such
extension. All payments hereunder shall be made in dollars.

(b) All payments and any proceeds of Collateral received by the Administrative
Agent (i) not constituting either (A) a specific payment of principal, interest,
fees or other sum payable under the Loan Documents (which shall be applied as
specified by the Borrowers), (B) a mandatory prepayment (which shall be applied
in accordance with Section 2.11) or (C) amounts to be applied from the
Collateral Account when the Cash Dominion Period is in effect (which shall be
applied in accordance with Section 2.10(b)) or (ii) after an Event of Default
has occurred and is continuing and the Administrative Agent so elects or the
Required Lenders so direct, shall be applied ratably first, to pay any fees,
indemnities, or expense reimbursements then due to the Administrative Agent and
the Issuing Bank from the Borrowers (other than in connection with Banking
Services Obligations or Swap Agreement Obligations), second, to pay any fees,
indemnities, or expense reimbursements then due to the Lenders from the
Borrowers (other than in connection with Banking Services Obligations or Swap
Agreement Obligations), third, to pay interest due in respect of the
Overadvances and Protective Advances, fourth, to pay the principal of the
Overadvances and Protective Advances, fifth, to pay interest then due and
payable on the Loans (other than the Overadvances and Protective Advances)
ratably, sixth, to prepay principal on the Loans (other than the Overadvances
and Protective Advances) and unreimbursed LC Disbursements, ratably, seventh, to
pay an amount to the Administrative Agent equal to one hundred three percent
(103%) of the aggregate LC Exposure, to be held as cash collateral for such
Obligations, eighth, to payment of any amounts owing in respect of Banking
Services Obligations and Swap Agreement Obligations up to and including the
amount most recently provided to the Administrative Agent pursuant to
Section 2.22, and ninth, to the payment of any other Secured Obligation due to
the Administrative Agent or any Lender by the Borrowers. Notwithstanding the
foregoing amounts received from any Loan Party shall not be applied to any
Excluded Swap Obligation of such Loan Party. Notwithstanding anything to the
contrary contained

 

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in this Agreement, unless so directed by the Borrower Representative, or unless
a Default is in existence, neither the Administrative Agent nor any Lender shall
apply any payment which it receives to any Eurodollar Loan of a Class, except
(a) on the expiration date of the Interest Period applicable thereto or (b) in
the event, and only to the extent, that there are no outstanding ABR Loans of
the same Class and, in any such event, the Borrowers shall pay the break funding
payment required in accordance with Section 2.16. The Administrative Agent and
the Lenders shall have the continuing and exclusive right to apply and reverse
and reapply any and all such proceeds and payments to any portion of the Secured
Obligations.

(c) At the election of the Administrative Agent, all payments of principal,
interest, LC Disbursements, fees, premiums, reimbursable expenses (including,
without limitation, all reimbursement for fees, costs and expenses pursuant to
Section 9.03), and other sums payable under the Loan Documents, may be paid from
the proceeds of Borrowings made hereunder whether made following a request by
the Borrower Representative pursuant to Section 2.03 or a deemed request as
provided in this Section or may be deducted from any deposit account of any
Borrower maintained with the Administrative Agent. The Borrowers hereby
irrevocably authorize, solely to the extent a payment is not paid by a Loan
Party by the required time set forth in the Loan Documents (after any applicable
grace period) (i) the Administrative Agent to make a Borrowing for the purpose
of paying each payment of principal, interest and fees as it becomes due
hereunder or any other amount due under the Loan Documents and agrees that all
such amounts charged shall constitute Loans (including Swingline Loans and
Overadvances, but such a Borrowing may only constitute a Protective Advance if
it is to reimburse costs, fees and expenses as described in Section 9.03) and
that all such Borrowings shall be deemed to have been requested pursuant to
Section 2.03, 2.04 or 2.05, as applicable, and (ii) the Administrative Agent to
charge any deposit account of any Borrower maintained with the Administrative
Agent for each payment of principal, interest and fees as it becomes due
hereunder or any other amount due under the Loan Documents.

(d) If, except as otherwise expressly provided herein, any Lender shall, by
exercising any right of setoff or counterclaim or otherwise, obtain payment in
respect of any principal of or interest on any of its Loans or participations in
LC Disbursements resulting in such Lender receiving payment of a greater
proportion of the aggregate amount of its Loans and participations in LC
Disbursements and Swingline Loans and accrued interest thereon than the
proportion received by any other similarly situated Lender, then the Lender
receiving such greater proportion shall purchase (for cash at face value)
participations in the Loans and participations in LC Disbursements and Swingline
Loans of other Lenders to the extent necessary so that the benefit of all such
payments shall be shared by all such Lenders ratably in accordance with the
aggregate amount of principal of and accrued interest on their respective Loans
and participations in LC Disbursements and Swingline Loans; provided that (i) if
any such participations are purchased and all or any portion of the payment
giving rise thereto is recovered, such participations shall be rescinded and the
purchase price restored to the extent of such recovery, without interest, and
(ii) the provisions of this paragraph shall not be construed to apply to any
payment made by the Borrowers pursuant to and in accordance with the express
terms of this Agreement or any payment obtained by a Lender as consideration for
the assignment of or sale of a participation in any of its Loans or
participations in LC Disbursements or Swingline Loans to any assignee or
participant, other than to the Borrowers or any Subsidiary or Affiliate thereof
(as to which the provisions of this paragraph shall apply). Each Borrower
consents to the foregoing and agrees, to the extent it may effectively do so
under applicable law, that any Lender acquiring a participation pursuant to the
foregoing arrangements may exercise against such Borrower rights of setoff and
counterclaim with respect to such participation as fully as if such Lender were
a direct creditor of such Borrower in the amount of such participation.

 

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(e) Unless the Administrative Agent shall have received, prior to any date on
which any payment is due to the Administrative Agent for the account of the
Lenders or the Issuing Bank pursuant to the terms hereof or any other Loan
Document (including any date that is fixed for prepayment by notice from the
Borrower Representative to the Administrative Agent pursuant to
Section 2.11(e)), notice from the Borrower Representative that the Borrowers
will not make such payment or prepayment, the Administrative Agent may assume
that the Borrowers have made such payment on such date in accordance herewith
and may, in reliance upon such assumption, distribute to the Lenders or the
Issuing Bank, as the case may be, the amount due. In such event, if the
Borrowers have not in fact made such payment, then each of the Lenders or the
Issuing Bank, as the case may be, severally agrees to repay to the
Administrative Agent forthwith on demand the amount so distributed to such
Lender or Issuing Bank with interest thereon, for each day from and including
the date such amount is distributed to it to but excluding the date of payment
to the Administrative Agent, at the greater of the NYFRB Rate and a rate
determined by the Administrative Agent in accordance with banking industry rules
on interbank compensation.

(f) The Administrative Agent may from time to time provide the Borrowers with
account statements or invoices with respect to any of the Secured Obligations
(the “Statements”). The Administrative Agent is under no duty or obligation to
provide Statements, which, if provided, will be solely for the Borrowers’
convenience. Statements may contain estimates of the amounts owed during the
relevant billing period, whether of principal, interest, fees or other Secured
Obligations. If the Borrowers pay the full amount indicated on a Statement on or
before the due date indicated on such Statement, the Borrowers shall not be in
default of payment with respect to the billing period indicated on such
Statement; provided, that acceptance by the Administrative Agent, on behalf of
the Lenders, of any payment that is less than the total amount actually due at
that time (including but not limited to any past due amounts) shall not
constitute a waiver of the Administrative Agent’s or the Lenders’ right to
receive payment in full at another time.

SECTION 2.19. Mitigation Obligations; Replacement of Lenders or Issuing Banks.

(a) If any Recipient requests compensation under Section 2.15, or if the
Borrowers are required to pay any Indemnified Taxes or additional amounts to any
Recipient or any Governmental Authority for the account of any Recipient
pursuant to Section 2.17, then such Recipient shall use reasonable efforts to
mitigate the effects of the event giving rise to such request or payment,
including, in the case of a Lender or an Issuing Bank, designating a different
lending office for funding or booking its Loans hereunder or to assign its
rights and obligations hereunder to another of its offices, branches or
affiliates, if, in the judgment of such Lender or such Issuing Bank, such
designation or assignment (i) would eliminate or reduce amounts payable pursuant
to Section 2.15 or 2.17, as the case may be, in the future and (ii) would not
subject such Lender or such Issuing Bank to any unreimbursed cost or expense and
would not otherwise be materially disadvantageous to such Lender or such Issuing
Bank. The Borrowers hereby agree to pay all reasonable out-of-pocket costs and
expenses incurred by any Lender or any Issuing Bank in connection with any such
designation or assignment.

(b) If any Lender or any Issuing Bank requests compensation under Section 2.15,
or if the Borrowers are required to pay any Indemnified Taxes or additional
amounts to any Lender, any Issuing Bank or any Governmental Authority for the
account of any Lender or any Issuing Bank pursuant to Section 2.17, or if any
Lender or Issuing Bank becomes a Defaulting Lender (each a “Departing Lender”),
then the Borrowers may, at their sole expense and effort, upon notice to such
Departing Lender and the Administrative Agent, require such Lender or Issuing
Bank to assign and delegate, without recourse (in accordance with and subject to
the restrictions contained in Section 9.04), all its interests, rights (other
than its existing rights to payments pursuant to Section 2.15 or 2.17) and
obligations under this Agreement and other Loan Documents to an assignee that
shall assume such obligations (which assignee may be another Lender or another
Issuing Bank, if a Lender or Issuing Bank accepts such assignment); provided
that (i) the Borrowers shall have received the prior written consent of the
Administrative Agent

 

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(and in circumstances where its consent would be required under Section 9.04,
the Issuing Bank and the Swingline Lender), which consent shall not unreasonably
be withheld, (ii) the Departing Lender shall have received payment of an amount
equal to the outstanding principal of its Loans and funded participations in LC
Disbursements and Swingline Loans, accrued interest thereon, accrued fees and
all other amounts payable to it hereunder, from the assignee (to the extent of
such outstanding principal and accrued interest and fees) or the Borrowers (in
the case of all other amounts) and (iii) in the case of any such assignment
resulting from a claim for compensation under Section 2.15 or payments required
to be made pursuant to Section 2.17, such assignment will result in a reduction
in such compensation or payments. A Departing Lender shall not be required to
make any such assignment and delegation if, prior thereto, as a result of a
waiver by such Lender or such Issuing Bank or otherwise, the circumstances
entitling the Borrowers to require such assignment and delegation cease to
apply. Each party hereto agrees that (x) an assignment required pursuant to this
paragraph may be effected pursuant to an Assignment and Assumption executed by
the Borrower Representative, the Administrative Agent and the assignee (or, to
the extent applicable, an agreement incorporating an Assignment and Assumption
by reference pursuant to an Approved Electronic Platform as to which the
Administrative Agent and such parties are participants), and (y) the Lender
required to make such assignment need not be a party thereto in order for such
assignment to be effective and shall be deemed to have consented to an be bound
by the terms thereof; provided that, following the effectiveness of any such
assignment, the other parties to such assignment agree to execute and deliver
such documents necessary to evidence such assignment as reasonably requested by
the applicable Lender, provided that any such documents shall be without
recourse to or warranty by the parties thereto.

SECTION 2.20. Defaulting Lenders. Notwithstanding any provision of this
Agreement to the contrary, if any Lender becomes a Defaulting Lender, then the
following provisions shall apply for so long as such Lender is a Defaulting
Lender:

(a) fees shall cease to accrue on the unfunded portion of the Revolving
Commitment of such Defaulting Lender pursuant to Section 2.12(a);

(b) any payment of principal, interest, fees or other amounts received by the
Administrative Agent for the account of such Defaulting Lender (whether
voluntary or mandatory, at maturity, pursuant to Section 2.18(b) or otherwise)
or received by the Administrative Agent from a Defaulting Lender pursuant to
Section 9.08 shall be applied at such time or times as may be determined by the
Administrative Agent as follows: first, to the payment of any amounts owing by
such Defaulting Lender to the Administrative Agent hereunder; second, to the
payment on a pro rata basis of any amounts owing by such Defaulting Lender to
any Issuing Bank or Swingline Lender hereunder; third, to cash collateralize the
Issuing Bank’s LC Exposure with respect to such Defaulting Lender in accordance
with this Section; fourth, as the Borrower Representative may request (so long
as no Default or Event of Default exists), to the funding of any Loan in respect
of which such Defaulting Lender has failed to fund its portion thereof as
required by this Agreement, as determined by the Administrative Agent; fifth, if
so determined by the Administrative Agent and the Borrower Representative, to be
held in a deposit account and released pro rata in order to (x) satisfy such
Defaulting Lender’s potential future funding obligations with respect to Loans
under this Agreement and (y) cash collateralize the Issuing Bank’s future LC
Exposure with respect to such Defaulting Lender with respect to future Letters
of Credit issued under this Agreement, in accordance with this Section; sixth,
to the payment of any amounts owing to the Lenders, the Issuing Bank or
Swingline Lender as a result of any judgment of a court of competent
jurisdiction obtained by any Lender, the Issuing Bank or Swingline Lender
against such Defaulting Lender as a result of such Defaulting Lender’s breach of
its obligations under this Agreement or under any other Loan Document; seventh,
so long as no Default or Event of Default exists, to the payment of any amounts
owing to the Borrowers as a result of any judgment of a court of competent
jurisdiction obtained by any Borrower against such Defaulting Lender as a result
of such Defaulting Lender’s breach of its obligations under this

 

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Agreement or under any other Loan Document; and eighth, to such Defaulting
Lender or as otherwise directed by a court of competent jurisdiction; provided
that if (x) such payment is a payment of the principal amount of any Loans or LC
Disbursements in respect of which such Defaulting Lender has not fully funded
its appropriate share, and (y) such Loans were made or the related Letters of
Credit were issued at a time when the conditions set forth in Section 4.02 were
satisfied or waived, such payment shall be applied solely to pay the Loans of,
and LC Disbursements owed to, all non-Defaulting Lenders on a pro rata basis
prior to being applied to the payment of any Loans of, or LC Disbursements owed
to, such Defaulting Lender until such time as all Loans and funded and unfunded
participations in the Borrowers’ obligations corresponding to such Defaulting
Lender’s LC Exposure and Swingline Loans are held by the Lenders pro rata in
accordance with the Commitments without giving effect to clause (d) below. Any
payments, prepayments or other amounts paid or payable to a Defaulting Lender
that are applied (or held) to pay amounts owed by a Defaulting Lender or to post
cash collateral pursuant to this Section shall be deemed paid to and redirected
by such Defaulting Lender, and each Lender irrevocably consents hereto;

(c) such Defaulting Lender shall not have the right to vote on any issue on
which voting is required (other than to the extent expressly provided in
Section 9.02(b)) and the Commitment and Revolving Exposure of such Defaulting
Lender shall not be included in determining whether the Required Lenders or
Supermajority Lenders have taken or may take any action hereunder (including any
consent to any amendment, waiver or other modification pursuant to Section 9.02)
or under any other Loan Document; provided, that, except as otherwise provided
in Section 9.02, this clause (c) shall not apply to the vote of a Defaulting
Lender in the case of an amendment, waiver or other modification requiring the
consent of such Lender or each Lender directly affected thereby;

(d) if any Swingline Exposure or LC Exposure exists at the time a Lender becomes
a Defaulting Lender then:

(i) all or any part of the Swingline Exposure and LC Exposure of such Defaulting
Lender shall be reallocated among the non-Defaulting Lenders in accordance with
their respective Applicable Percentages but only to the extent that such
reallocation does not, as to any non-Defaulting Lender, cause such
non-Defaulting Lender’s Revolving Exposure to exceed its Revolving Commitment;

(ii) if the reallocation described in clause (i) above cannot, or can only
partially, be effected, the Borrowers shall within one (1) Business Day
following notice by the Administrative Agent (x) first, prepay such Swingline
Exposure and (y) second, cash collateralize, for the benefit of the Issuing
Bank, the Borrowers’ obligations corresponding to such Defaulting Lender’s LC
Exposure (after giving effect to any partial reallocation pursuant to clause
(i) above) in accordance with the procedures set forth in Section 2.06(j) for so
long as such LC Exposure is outstanding;

(iii) if the Borrowers cash collateralize any portion of such Defaulting
Lender’s LC Exposure pursuant to clause (ii) above, the Borrowers shall not be
required to pay any fees to such Defaulting Lender pursuant to Section 2.12(b)
with respect to such Defaulting Lender’s LC Exposure during the period such
Defaulting Lender’s LC Exposure is cash collateralized;

(iv) if the LC Exposure of the non-Defaulting Lenders is reallocated pursuant to
clause (i) above, then the fees payable to the Lenders pursuant to Sections
2.12(a) and 2.12(b) shall be adjusted in accordance with such non-Defaulting
Lenders’ Applicable Percentages; and

 

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(v) if all or any portion of such Defaulting Lender’s LC Exposure is neither
reallocated nor cash collateralized pursuant to clause (i) or (ii) above, then,
without prejudice to any rights or remedies of the Issuing Bank or any other
Lender hereunder, all letter of credit fees payable under Section 2.12(b) with
respect to such Defaulting Lender’s LC Exposure shall be payable to the Issuing
Bank until and to the extent that such LC Exposure is reallocated and/or cash
collateralized.

In the event that each of the Administrative Agent, the Borrowers and the
Issuing Bank agrees that a Defaulting Lender has adequately remedied all matters
that caused such Lender to be a Defaulting Lender, then LC Exposure of the
Lenders shall be readjusted to reflect the inclusion of such Lender’s Revolving
Commitment and on the date of such readjustment such Lender shall purchase at
par such of the Loans of the other Lenders (other than Swingline Loans) as the
Administrative Agent shall determine may be necessary in order for such Lender
to hold such Loans in accordance with its Applicable Percentage.

SECTION 2.21. Returned Payments. If after receipt of any payment which is
applied to the payment of all or any part of the Obligations (including a
payment effected through exercise of a right of setoff), the Administrative
Agent or any Lender is for any reason compelled to surrender such payment or
proceeds to any Person because such payment or application of proceeds is
invalidated, declared fraudulent, set aside, determined to be void or voidable
as a preference, impermissible setoff, or a diversion of trust funds, or for any
other reason (including pursuant to any settlement entered into by the
Administrative Agent or such Lender in its discretion), then the Obligations or
part thereof intended to be satisfied shall be revived and continued and this
Agreement shall continue in full force as if such payment or proceeds had not
been received by the Administrative Agent or such Lender. The provisions of this
Section 2.21 shall be and remain effective notwithstanding any contrary action
which may have been taken by the Administrative Agent or any Lender in reliance
upon such payment or application of proceeds. The provisions of this
Section 2.21 shall survive the termination of this Agreement.

SECTION 2.22. Banking Services and Swap Agreements.

(a) Each Lender or Affiliate thereof providing Banking Services for, or having
Swap Agreements with, any Loan Party (other than Parent) shall deliver to the
Administrative Agent, promptly after entering into such Banking Services or Swap
Agreements, written notice setting forth the aggregate amount of all Banking
Services Obligations and Swap Agreement Obligations of such Loan Party to such
Lender or Affiliate (whether matured or unmatured, absolute or contingent). In
addition, each such Lender or Affiliate thereof shall deliver to the
Administrative Agent, following the end of each calendar month, a summary of the
amounts due or to become due in respect of such Banking Services Obligations and
Swap Agreement Obligations. The most recent information provided to the
Administrative Agent shall be used in determining the amounts to be applied in
respect of such Banking Services Obligations and/or Swap Agreement Obligations
pursuant to Section 2.18(b).

(b) Each time a Loan Party (other than Parent) enters into (i) any Swap
Agreement, (ii) any “Swap Transaction” under any Swap Agreement or (iii) any
agreement giving rise to Banking Services Obligations, the Company shall deliver
to the Senior Secured Notes Representative and the Administrative Agent an
“Additional ABL Obligation Designation” with respect to such agreement or
transaction in the form of Exhibit B to the Senior Secured Notes Intercreditor
Agreement, all in accordance with Section 3.9 of the Senior Secured Notes
Intercreditor Agreement. Each term in quotations in this Section 2.22(b) shall
have the meaning assigned thereto in the Senior Secured Notes Intercreditor
Agreement.

 

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ARTICLE III

Representations and Warranties

Each Loan Party represents and warrants to the Lenders that:

SECTION 3.01. Organization; Powers. Each Loan Party and each Subsidiary (a) is a
Person duly organized or formed, validly existing and in good standing under the
laws of the jurisdiction of its organization, (b) has all requisite power and
authority to carry on its business as now conducted and (c) is qualified to do
business, and is in good standing (to the extent such concept exists in such
jurisdiction) under the Laws of each jurisdiction where its ownership, lease or
operation of properties or the conduct of its business requires such
qualification; except in each case referred to in clauses (a) and (b) (other
than with respect to Borrowing Base Parties) and (c), to the extent that failure
to do so could not reasonably be expected to have a Material Adverse Effect.

SECTION 3.02. Authorization; Enforceability. The Transactions are within each
Loan Party’s corporate or other organizational powers and have been duly
authorized by all necessary corporate or other organizational actions and, if
required, actions by equity holders. Each Loan Document to which each Loan Party
is a party has been duly executed and delivered by such Loan Party and
constitutes a legal, valid and binding obligation of such Loan Party,
enforceable in accordance with its terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium or other laws affecting creditors’ rights
generally and subject to general principles of equity, regardless of whether
considered in a proceeding in equity or at law.

SECTION 3.03. Governmental Approvals; No Conflicts. The Transactions (a) do not
require any consent or approval of, registration or filing with, or any other
action by, any Governmental Authority, except such as have been obtained or made
and are in full force and effect and except for filings necessary to perfect
Liens created pursuant to the Loan Documents, (b) do not violate any Requirement
of Law applicable to any Loan Party or any Subsidiary, (c) do not violate or
result in a default under any indenture, agreement or other instrument binding
upon any Loan Party or any Subsidiary or the assets of any Loan Party or any
Subsidiary (including, without limitation, the Senior Secured Notes Documents),
or give rise to a right thereunder to require any payment to be made by any Loan
Party or any Subsidiary, and (d) will not result in the creation or imposition
of, or the requirement to create, any Lien on any asset of any Loan Party or any
Subsidiary, except Liens created pursuant to the Loan Documents or the Senior
Secured Notes Documents and, in the case of clauses (a), (b) and (c) (other than
with respect to the Senior Secured Note Documents or any Additional Secured
Indebtedness Documents) except as could not be reasonably expected to have a
Material Adverse Effect.

SECTION 3.04. Financial Condition; No Material Adverse Change. (a) The Parent
has heretofore furnished to the Lenders its consolidated balance sheet and
related consolidated statements of operations, comprehensive loss, stockholders’
equity (deficit) and cash flows (i) as of and for the fiscal year ended
December 31, 2018, reported on by Deloitte & Touche LLP, independent public
accountants, and (ii) as of and for the fiscal quarter and the portion of the
fiscal year ended March 31, 2019, certified by its chief financial officer. Such
financial statements present fairly, in all material respects, the financial
position and results of operations and cash flows of the Parent and its
consolidated Subsidiaries as of such dates and for such periods in accordance
with GAAP, subject to normal year-end audit adjustments and the absence of
footnotes in the case of the statements referred to in clause (ii) above.

(b) No event, change or condition has occurred that has had, or could reasonably
be expected to have, a Material Adverse Effect, since December 31, 2018.

 

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SECTION 3.05. Properties. (a) Except where the failure to do so, individually or
in the aggregate, could not reasonably be expected to result in a Material
Adverse Effect, each of the Loan Parties and each of its Subsidiaries has good
and indefeasible title to, or valid leasehold interests in, all of its real and
personal property necessary in the ordinary conduct of its business, free of all
Liens other than those permitted by Section 6.02. Except where the failure to do
so, individually or in the aggregate, could not reasonably be expected to result
in a Material Adverse Effect, each lease and sublease by or to any Loan Party
with respect to any parcel of real property or any cell tower is valid and
enforceable in accordance with its terms and is in full force and effect, and no
default by any party to any such lease or sublease exists.

(b) Except where the failure to do so, individually or in the aggregate, could
not reasonably be expected to result in a Material Adverse Effect, (i) each Loan
Party and each Subsidiary owns, or is licensed to use, all trademarks,
tradenames, copyrights, patents and other intellectual property necessary to its
business as currently conducted and (ii) the use thereof by each Loan Party and
each Subsidiary does not infringe in any material respect upon the rights of any
other Person.

SECTION 3.06. Litigation and Environmental Matters. (a) There are no actions,
suits or proceedings by or before any arbitrator or Governmental Authority
pending against or, to the knowledge of any Loan Party, threatened against or
affecting any Loan Party or any Subsidiary (i) as to which there is a reasonable
possibility of an adverse determination that could reasonably be expected,
individually or in the aggregate, to result in a Material Adverse Effect (other
than the Disclosed Matters) or (ii) that involve any Loan Document or the
Transactions.

(b) Except for the Disclosed Matters (i) no Loan Party or any Subsidiary has
received notice of any claim with respect to any Environmental Liability or
knows of any basis for any Environmental Liability and (ii) except with respect
to any other matters that, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect, no Loan Party or
any Subsidiary (A) has failed to comply with any Environmental Law or to obtain,
maintain or comply with any permit, license or other approval required under any
Environmental Law, (B) has become subject to any Environmental Liability,
(C) has received notice of any claim with respect to any Environmental Liability
or (D) knows of any basis for any Environmental Liability.

(c) Since the date of this Agreement, there has been no change in the status of
the Disclosed Matters that, individually or in the aggregate, has resulted in a
Material Adverse Effect.

SECTION 3.07. Compliance with Laws and Agreements; No Default. Except where the
failure to do so, individually or in the aggregate, could not reasonably be
expected to result in a Material Adverse Effect, each Loan Party and each
Subsidiary is in compliance with (a) all Requirement of Law applicable to it or
its property and (b) all indentures, agreements and other instruments binding
upon it or its property. No Default has occurred and is continuing.

SECTION 3.08. Investment Company Status. No Loan Party or any Subsidiary is an
“investment company” as defined in, or subject to regulation under, the
Investment Company Act of 1940.

SECTION 3.09. Taxes. Each Loan Party and each Subsidiary has timely filed or
caused to be filed all Tax returns and reports required to have been filed and
has paid or caused to be paid all Taxes required to have been paid by it, except
(a) Taxes that are being contested in good faith by appropriate proceedings and
for which such Loan Party or such Subsidiary, as applicable, has set aside on
its books adequate reserves or (b) to the extent that the failure to do so could
not be expected to result in a Material Adverse Effect. No tax liens have been
filed and no claims are being asserted with respect to any such taxes.

 

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SECTION 3.10. Pension Plans.

(a) No ERISA Event has occurred or is reasonably expected to occur that, when
taken together with all other such ERISA Events for which liability is
reasonably expected to occur, could reasonably be expected to result in a
Material Adverse Effect. The present value of all accumulated benefit
obligations under each Plan (based on the assumptions used for purposes of
Statement of Financial Accounting Standards No. 87) did not, as of the date of
the most recent financial statements reflecting such amounts, exceed by more
than $10,000,000 the fair market value of the assets of such Plan.

(b) To the extent applicable, each of the Canadian Guarantor and the other Loan
Parties is in compliance with the requirements of the Pension Benefits Act,
R.S.O. 1990, c. P.8and other federal or provincial laws with respect to each
(i) Canadian Pension Plan, except where the failure to comply would not
reasonably be expected to have a Material Adverse Effect, and (ii) Canadian
Defined Benefit Plan. No fact or situation that may reasonably be expected to
result in a Material Adverse Effect exists in connection with any Canadian
Pension Plan or Canadian Defined Benefit Plan. No Canadian Pension Event has
occurred. Neither the Canadian Guarantor nor any other Loan Parties has a
Canadian Defined Benefit Plan. The Financial Services Commission of Ontario
(“FSCO”) has not issued any default or other breach notices in respect of any
Canadian Defined Benefit Plan. No lien has arisen, choate or inchoate, in
respect of any Canadian Guarantor or their Subsidiaries or their property in
connection with any Canadian Pension Plan (save for contribution amounts not yet
due) on property having a value in excess of $10,000,000.

SECTION 3.11. Disclosure. None of the reports, financial statements,
certificates or other information furnished by or on behalf of any Loan Party or
any Subsidiary to the Administrative Agent or any Lender in connection with the
negotiation of this Agreement or any other Loan Document (as modified or
supplemented by other information so furnished) contains any material
misstatement of fact or omits to state any material fact necessary to make the
statements therein, in the light of the circumstances under which they were
made, not misleading; provided that, with respect to projected financial
information, the Loan Parties represent only that such information was prepared
in good faith based upon assumptions believed to be reasonable at the time
delivered, it being understood that such projections may vary from actual
results and that such variances may be material.

SECTION 3.12. Solvency. (a) Immediately after the consummation of the
Transactions to occur on the Effective Date, (i) the fair value of the assets of
the Loan Parties and their Subsidiaries, on a consolidated basis, at a fair
valuation, will exceed its debts and liabilities, subordinated, contingent (to
the extent constituting identified contingent liabilities) or otherwise;
(ii) the present fair saleable value of the property of each Loan Party and
their respective Subsidiaries will be greater than the amount that will be
required to pay the probable liability of its debts and other liabilities,
subordinated, contingent (to the extent constituting identified contingent
liabilities) or otherwise, as such debts and other liabilities become absolute
and matured; (iii) the Loan Parties and their Subsidiaries, on a consolidated
basis, will be able to pay its debts and liabilities, subordinated, contingent
or otherwise, as such debts and liabilities become absolute and matured; and
(iv) the Loan Parties and their Subsidiaries will, on a consolidated basis, not
have unreasonably small capital with which to conduct the business in which it
is engaged as such business is now conducted and is proposed to be conducted
after the Effective Date.

(b) The Loan Parties, on a consolidated basis, do not intend to, or believe that
they will, incur debts beyond their ability to pay such debts as they mature,
taking into account the timing of and amounts of cash to be received by them or
any such Subsidiary and the timing of the amounts of cash to be payable on or in
respect of their Indebtedness or the Indebtedness of any such Subsidiary.

 

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SECTION 3.13. Insurance. Schedule 3.13 sets forth a description of all insurance
maintained by or on behalf of the Loan Parties and their Subsidiaries as of the
Effective Date. As of the Effective Date, all premiums in respect of such
insurance have been paid. Each Loan Party maintains, and has caused each
Subsidiary to maintain, with financially sound and reputable insurance
companies, insurance on all their real and personal property in such amounts,
subject to such deductibles and self-insurance retentions and covering such
properties and risks as are adequate and customarily maintained by companies
engaged in the same or similar businesses operating in the same or similar
locations.

SECTION 3.14. Capitalization and Subsidiaries. As of the Effective Date,
Schedule 3.14 sets forth (a) a correct and complete list of the name and
relationship to the Parent of each and all of the Parent’s Subsidiaries, (b) a
true and complete listing of each class of each Loan Party’s authorized Equity
Interests, all of which issued Equity Interests are validly issued, outstanding,
fully paid and non-assessable, and other than with respect to the Parent, owned
beneficially and of record by the Persons identified on Schedule 3.14, and
(c) the type of entity of the Parent and each of its Subsidiaries. All of the
issued and outstanding Equity Interests owned by any Loan Party in any
Subsidiary (other than any Subsidiary that is a shell entity that does not own
any material assets) have been (to the extent such concepts are relevant with
respect to such ownership interests) duly authorized and issued and are fully
paid and non-assessable.

SECTION 3.15. Security Interest in Collateral. The provisions of this Agreement
and the other Loan Documents create legal and valid Liens on all of the
Collateral in favor of the Administrative Agent, for the benefit of the Secured
Parties, and, upon filing of UCC financing statements or PPSA financing
statements, as applicable, and the taking of any other actions or making of
filings required for perfection to the extent specified herein or in such
Collateral Documents, as, and when necessary and required, and, if applicable,
the taking of actions or making of filings with respect to Intellectual Property
registrations or applications issued or pending as specified such Liens
constitute perfected and continuing Liens on the Collateral, securing the
Secured Obligations, enforceable against the applicable Loan Party and all third
parties (subject to applicable bankruptcy, insolvency, reorganization,
moratorium or other laws affecting creditors’ rights generally and subject to
general principles of equity, regardless of whether considered in a proceeding
in equity or at law), and having priority over all other Liens on the Collateral
except in the case of (a) Permitted Encumbrances, to the extent any such
Permitted Encumbrances would have priority over the Liens in favor of the
Administrative Agent pursuant to any applicable law, (b) Liens in favor of the
Senior Secured Notes Representative securing the Senior Notes Obligations which
may have priority solely with respect to the Senior Secured Notes Priority
Collateral in accordance with and subject to the terms of the Senior Secured
Notes Intercreditor Agreement, (c) Liens in favor of any applicable
representative for holders of Additional Secured Indebtedness Obligations
securing such Additional Secured Indebtedness Obligations which may have
priority solely with respect to the Collateral that is not ABL Priority
Collateral in accordance with and subject to the terms of the applicable
Additional Indebtedness Intercreditor Agreement and (d) Liens perfected only by
possession (including possession of any certificate of title) to the extent the
Administrative Agent has not obtained or does not maintain possession of such
Collateral.

SECTION 3.16. Employment Matters. As of the Effective Date, except as in the
aggregate could not reasonably be expected to have a Material Adverse Effect,
(a) there are no strikes, lockouts or slowdowns against any Loan Party or any
Subsidiary pending or, to the knowledge of the Borrowers, threatened, (b) the
terms and conditions of employment, the hours worked by and payments made to
employees of the Loan Parties and the Subsidiaries have not been in violation of
the Fair Labor Standards Act or any other applicable federal, state, provincial,
territorial, local or foreign law dealing with such

 

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matters, (c) all payments due from any Loan Party or any Subsidiary, or for
which any claim may be made against any Loan Party or any Subsidiary, on account
of wages, vacation pay and employee health and welfare insurance and other
benefits have been paid or accrued as a liability on the books of the Loan Party
or such Subsidiary and (d) the consummation of the Transactions will not give
rise to any right of termination or right of renegotiation on the part of any
union under any collective bargaining agreement to which any Loan Party or any
of its Subsidiaries are bound.

SECTION 3.17. Margin Regulations. No Loan Party is engaged, principally or as
one of its important activities, in the business of purchasing or carrying
Margin Stock, or extending credit for the purpose of purchasing or carrying
Margin Stock, and no proceeds of any Borrowings or drawings under any Letter of
Credit will be used for any purpose that violates Regulation U of the Board of
Governors of the United States Federal Reserve System.

SECTION 3.18. Anti-Corruption Laws and Sanctions. Each Loan Party has
implemented and maintains in effect policies and procedures designed to ensure
compliance by such Loan Party, its Subsidiaries and their respective directors,
officers, employees and agents with Anti-Corruption Laws and applicable
Sanctions, and such Loan Party, its Subsidiaries and their respective officers
and directors and, to the knowledge of such Loan Party, its employees and
agents, are in compliance with Anti-Corruption Laws and applicable Sanctions in
all material respects. None of (a) any Loan Party, any Subsidiary or any of
their respective directors, officers or employees, or (b) to the knowledge of
any such Loan Party or Subsidiary, any agent of such Loan Party or any
Subsidiary that will act in any capacity in connection with or benefit from the
credit facility established hereby, is a Sanctioned Person. No Borrowing or
Letter of Credit, use of proceeds, Transaction or other transaction contemplated
by this Agreement or the other Loan Documents will violate Anti-Corruption Laws
or applicable Sanctions.

SECTION 3.19. Use of Proceeds. The proceeds of the Loans have been used, whether
directly or indirectly, as set forth in Section 5.08.

SECTION 3.20. Common Enterprise. The successful operation and condition of each
of the Loan Parties is dependent on the continued successful performance of the
functions of the group of the Loan Parties as a whole and the successful
operation of each of the Loan Parties is dependent on the successful performance
and operation of each other Loan Party. Each Loan Party expects to derive
benefit (and its board of directors or other governing body has determined that
it may reasonably be expected to derive benefit), directly and indirectly, from
(a) successful operations of each of the other Loan Parties and (b) the credit
extended by the Lenders to the Borrowers hereunder, both in their separate
capacities and as members of the group of companies. Each Loan Party has
determined that execution, delivery, and performance of this Agreement and any
other Loan Documents to be executed by such Loan Party is within its purpose, in
furtherance of its direct and/or indirect business interests, will be of direct
and/or indirect benefit to such Loan Party, and is in its best interest.

SECTION 3.21. EEA Financial Institutions. No Loan Party is an EEA Financial
Institution.

SECTION 3.22. Plan Assets; Prohibited Transactions. No Loan Party or any of its
Subsidiaries is an entity deemed to hold “plan assets” (within the meaning of
the Plan Asset Regulations), and, assuming no Lender is using “plan assets” in
connection with the Loans, the Letters of Credit or the Commitments or an
applicable exemption is satisfied, neither the execution, delivery nor
performance of the transactions contemplated under this Agreement, including the
making of any Loan and the issuance of any Letter of Credit hereunder, will give
rise to a non-exempt prohibited transaction under Section 406 of ERISA or
Section 4975 of the Code.

 

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SECTION 3.23. Regulatory Matters. The Loan Parties have all FCC Licenses and FAA
Approvals necessary to operate the Loan Parties’ business, and all such FCC
Licenses and FAA Approvals have been validly issued in the name of a Loan
Party. The FCC Licenses that have been issued are in full force and effect, are
valid for the balance of the current license term, are unimpaired by any act or
omissions of the Borrower, its Subsidiaries or any of their employees, agents,
officers, directors or stockholders, and are free and clear of any material
restrictions, and have been so unrestricted for the full current license
term. There are no applications, proceedings or complaints pending or, to the
best of the Loan Parties’ knowledge, threatened regarding the Loan Parties’ FCC
Licenses and FAA Approvals that could reasonably be expected to have a Material
Adverse Effect. No renewal of any FCC License would constitute a major federal
action having a significant effect on the human environment under Section 1.1305
or 1.1307(b) of the FCC’s rules.

ARTICLE IV

Conditions.

SECTION 4.01. Effective Date. The obligations of the Lenders to make Loans and
of the Issuing Bank to issue Letters of Credit hereunder shall not become
effective until the date on which each of the following conditions is satisfied
(or waived in accordance with Section 9.02):

(a) Credit Agreement and Other Loan Documents. The Administrative Agent (or its
counsel) shall have received (i) from each party hereto either (A) a counterpart
of this Agreement signed on behalf of such party or (B) written evidence
satisfactory to the Administrative Agent (which may include facsimile or other
electronic transmission of a signed signature page of this Agreement) that such
party has signed a counterpart of this Agreement, (ii) either (A) a counterpart
of each other Loan Document signed on behalf of each party thereto or
(B) written evidence satisfactory to the Administrative Agent (which may include
facsimile or other electronic transmission of a signed signature page thereof)
that each such party has signed a counterpart of such Loan Document and
(iii) such other certificates, documents, instruments and agreements as the
Administrative Agent shall reasonably request in connection with the
transactions contemplated by this Agreement and the other Loan Documents,
including any promissory notes requested by a Lender pursuant to Section 2.10
payable to the order of each such requesting Lender and written opinions of the
Loan Parties’ counsel, addressed to the Administrative Agent, the Issuing Bank
and the Lenders in in form and substance reasonably satisfactory to the
Administrative Agent and its counsel.

(b) Financial Statements and Projections. The Lenders shall have received
(i) audited consolidated financial statements of the Parent for the December 31,
2017 and December 31, 2018 fiscal years, (ii) unaudited interim consolidated
financial statements of the Parent for the fiscal quarter ended after the date
of the latest applicable financial statements delivered pursuant to clause
(i) of this paragraph as to which such financial statements are available, and
such financial statements shall not, in the reasonable judgment of the
Administrative Agent, reflect any material adverse change in the consolidated
financial condition of the Parent, as reflected in the audited, consolidated
financial statements described in clause (i) of this paragraph and
(iii) satisfactory projections through 2022.

(c) Closing Certificates; Certified Certificate of Incorporation; Good Standing
Certificates. The Administrative Agent shall have received (i) a certificate of
each Loan Party, dated the Effective Date and executed by its Secretary,
Assistant Secretary or other officer acceptable to the Administrative Agent,
which shall (A) certify the resolutions of its Board of Directors, members or
other body authorizing the execution, delivery and performance of the Loan
Documents to which it is a party, (B) identify by name and title and bear the
signatures of the officers of such Loan Party authorized to sign the Loan
Documents to which it is a party and, in the case of the Parent and each
Borrower, its Financial

 

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Officers, and (C) contain appropriate attachments, including the certificate or
articles of incorporation or organization of each Loan Party certified by the
relevant authority of the jurisdiction of organization of such Loan Party and a
true and correct copy of its by-laws or operating, management or partnership
agreement, or other organizational or governing documents, and (ii) a good
standing certificate for each Loan Party from its jurisdiction of organization
or the substantive equivalent available in the jurisdiction of organization for
each Loan Party from the appropriate governmental officer in such jurisdiction.

(d) No Default Certificate. The Administrative Agent shall have received a
certificate, signed by a Financial Officer of the Parent, dated as of the
Effective Date (i) stating that no Default has occurred and is continuing,
(ii) stating that the representations and warranties contained in the Loan
Documents are true and correct in all material respects (or for representations
and warranties qualified by materiality, including Material Adverse Effect, true
and correct after giving effect to any qualification therein in all respects) as
of such date.

(e) Fees. The Lenders and the Administrative Agent shall have received all fees
required to be paid, and all out-of-pocket expenses for which invoices have been
presented (including the reasonable fees and expenses of legal counsel), on or
before the Effective Date. All such amounts will be paid with proceeds of Loans
made on the Effective Date and will be reflected in the funding instructions
given by the Borrower Representative to the Administrative Agent on or before
the Effective Date.

(f) Lien Searches. The Administrative Agent shall have received the results of a
recent lien search in each jurisdiction where the Loan Parties are organized and
each other jurisdiction reasonably required by the Administrative Agent, and
such searches shall reveal no Liens on any of the assets of the Loan Parties
except for Liens permitted by Section 6.02 or discharged on or prior to the
Effective Date pursuant to a pay-off letter or other documentation satisfactory
to the Administrative Agent.

(g) Funding Account. The Administrative Agent shall have received a notice
setting forth the deposit account(s) of the Borrowers (the “Funding Account”) to
which the Administrative Agent is authorized by the Borrowers to transfer the
proceeds of any Borrowings requested or authorized pursuant to this Agreement.

(h) Customer List. The Administrative Agent shall have received a true and
complete customer list for each Loan Party, which list shall state the
customer’s name, mailing address and phone number.

(i) Solvency. The Administrative Agent shall have received a solvency
certificate signed by a Financial Officer of the Parent dated the Effective
Date.

(j) Borrowing Base Certificate. The Administrative Agent shall have received a
Borrowing Base Certificate which calculates the Borrowing Base as of July 31,
2019.

(k) Closing Availability. After giving effect to all Borrowings to be made on
the Effective Date, the issuance of any Letters of Credit on the Effective Date
and the payment of all fees and expenses due hereunder, and with all of the Loan
Parties’ indebtedness, liabilities, and obligations current, the Availability
shall not be less than $15,000,000.

(l) Pledged Equity Interests; Stock Powers; Pledged Notes. The Administrative
Agent be satisfied that the Senior Secured Notes Representative shall have
received (i) the certificates representing the Equity Interests pledged pursuant
to the U.S. Security Agreement, together with an undated stock power for each
such certificate executed in blank by a duly authorized officer of the pledgor
thereof and (ii) each promissory note (if any) pledged to the Administrative
Agent pursuant to the U.S. Security Agreement endorsed (without recourse) in
blank (or accompanied by an executed transfer form in blank) by the pledgor
thereof.

 

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(m) Filings, Registrations and Recordings. Each document (including any UCC
financing statement) required by the Collateral Documents or under law or
reasonably requested by the Administrative Agent to be filed, registered or
recorded in order to create in favor of the Administrative Agent, for the
benefit of itself, the Lenders and the other Secured Parties, a perfected Lien
on the Collateral described therein, prior and superior in right to any other
Person (other than with respect to Liens expressly permitted by Section 6.02),
shall be in proper form for filing, registration or recordation.

(n) Insurance. The Administrative Agent shall have received evidence of
insurance coverage in form, scope, and substance reasonably satisfactory to the
Administrative Agent and otherwise in compliance with the terms of Section 5.10
hereof and the U.S. Security Agreement.

(o) Letter of Credit Application. If a Letter of Credit is requested to be
issued on the Effective Date, the Administrative Agent shall have received a
properly completed letter of credit application (whether standalone or pursuant
to a master agreement, as applicable). The Borrowers shall have executed the
Issuing Bank’s master agreement for the issuance of commercial Letters of
Credit.

(p) Tax Withholding. The Administrative Agent shall have received a properly
completed and signed IRS Form W-8 or W-9, as applicable, for each Loan Party.

(q) USA PATRIOT Act, Etc. (i) The Administrative Agent shall have received, at
least five (5) days prior to the Effective Date, all documentation and other
information regarding the Loan Parties requested in connection with applicable
“know your customer” and anti-money laundering rules and regulations, including
the USA PATRIOT Act and the Canadian Anti-Money Laundering & Anti-Terrorism
Legislation, to the extent requested in writing of the Loan Parties at least ten
(10) days prior to the Effective Date, and (ii) to the extent any Borrower
qualifies as a “legal entity customer” under the Beneficial Ownership
Regulation, at least five (5) days prior to the Effective Date, any Lender that
has requested, in a written notice to the Borrowers at least ten (10) days prior
to the Effective Date, a Beneficial Ownership Certification in relation to each
Borrower shall have received such Beneficial Ownership Certification (provided
that, upon the execution and delivery by such Lender of its signature page to
this Agreement, the condition set forth in this clause (ii) shall be deemed to
be satisfied).

(r) Other Documents. The Administrative Agent shall have received such other
documents as the Administrative Agent, the Issuing Bank, any Lender or their
respective counsel may have reasonably requested.

The Administrative Agent shall notify the Borrowers, the Lenders and the Issuing
Bank of the Effective Date, and such notice shall be conclusive and binding.

SECTION 4.02. Each Credit Event. The obligation of each Lender to make a Loan on
the occasion of any Borrowing, and of the Issuing Bank to issue, amend, renew or
extend any Letter of Credit, is subject to the satisfaction of the following
conditions:

(a) The representations and warranties of the Loan Parties set forth in the Loan
Documents shall be true and correct in all material respects with the same
effect as though made on and as of the date of such Borrowing or the date of
issuance, amendment, renewal or extension of such Letter of Credit, as
applicable (it being understood and agreed that any representation or warranty
which by its terms is made as of a specified date shall be required to be true
and correct in all material respects only as of such specified date, and that
any representation or warranty which is subject to any materiality qualifier
(including Material Adverse Effect) shall be required to be true and correct in
all respects).

 

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(b) At the time of and immediately after giving effect to such Borrowing or the
issuance, amendment, renewal or extension of such Letter of Credit, as
applicable, (i) no Default shall have occurred and be continuing and (ii) no
Protective Advance shall be outstanding.

(c) After giving effect to any Borrowing or the issuance, amendment, renewal or
extension of any Letter of Credit, Availability shall not be less than zero.

Each Borrowing (provided that a conversion or continuation of a Borrowing shall
not constitute a “Borrowing” for purposes of this Section 4.02) and each
issuance, amendment, renewal or extension of a Letter of Credit shall be deemed
to constitute a representation and warranty by the Loan Parties on the date
thereof as to the matters specified in paragraphs (a), (b) and (c) of this
Section.

ARTICLE V

Affirmative Covenants.

Until all of the Obligations have been Paid in Full, each Loan Party executing
this Agreement covenants and agrees, jointly and severally with all of the other
Loan Parties, with the Lenders that:

SECTION 5.01. Financial Statements; Borrowing Base and Other Information. The
Parent will furnish to the Administrative Agent and each Lender:

(a) within ninety (90) days after the end of each fiscal year of the Parent, its
audited consolidated balance sheet and related consolidated statements of
operations, comprehensive loss, stockholders’ equity (deficit) and cash flows as
of the end of and for such year, setting forth in each case in comparative form
the figures for the previous fiscal year, all reported on by independent public
accountants of recognized national standing (without a “going concern” or like
qualification, commentary or exception and without any qualification or
exception as to the scope of such audit, in each case other than a qualification
or exception related solely to (x) the impending maturity of Loans and
Commitments at the applicable Maturity Date or the maturity of any other
Indebtedness existing on the Effective Date or incurred in compliance with the
Loan Documents or (y) as a result of any actual or potential default under the
financial covenants in Section 6.13 of this Agreement or any financial
maintenance covenant in any agreement governing Indebtedness of the Parent or
any Subsidiary on a future date or in a future period) to the effect that such
consolidated financial statements present fairly in all material respects the
financial condition and results of operations of the Parent and its consolidated
Subsidiaries on a consolidated basis in accordance with GAAP consistently
applied, accompanied by any management letter prepared by said accountants;

(b) within forty-five (45) days after the end of each of the first three fiscal
quarters of each fiscal year of the Parent, its consolidated balance sheet and
related consolidated statements of operations, comprehensive loss, stockholders’
equity (deficit) and cash flows as of the end of and for such fiscal quarter and
the then elapsed portion of such fiscal year, setting forth in each case in
comparative form the figures for the corresponding period or periods of (or, in
the case of the balance sheet, as of the end of) the previous fiscal year, all
certified by a Financial Officer of the Parent as presenting fairly in all
material respects the financial condition and results of operations of the
Parent and its consolidated Subsidiaries on a consolidated basis in accordance
with GAAP consistently applied, subject to normal year-end audit adjustments and
the absence of footnotes;

 

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(c) From and after the date on which Specified Availability is less than the
greater of 15.0% of the Aggregate Revolving Commitment and $4,500,000 and until
such subsequent date, if any, on which Specified Availability is greater than
the greater of 15.0% of the Aggregate Revolving Commitment and $4,500,000 for a
period of thirty (30) consecutive calendar days, within twenty (20) days after
the end of each fiscal month of the Parent during such period, its internally
generated consolidated balance sheet and related consolidated income statements
and cash flows as of the end of and for such fiscal month and the then elapsed
portion of the fiscal year, setting forth in each case in comparative form the
figures for the corresponding period or periods of (or, in the case of the
balance sheet, as of the end of) the previous fiscal year, all certified by a
Financial Officer of the Parent as presenting fairly in all material respects
the financial condition and results of operations of the Parent and its
consolidated Subsidiaries on a consolidated basis in accordance with GAAP
consistently applied, subject to normal year-end audit adjustments and the
absence of footnotes;

(d) concurrently with any delivery of financial statements under clause (a), (b)
or (c) above, a Compliance Certificate (i) certifying, in the case of the
financial statements delivered under clause (b) or (c), as presenting fairly in
all material respects the financial condition and results of operations of the
Parent and its consolidated Subsidiaries on a consolidated basis in accordance
with GAAP consistently applied, subject to normal year-end audit adjustments and
the absence of footnotes, (ii) certifying as to whether a Default has occurred
and, if a Default has occurred, specifying the details thereof and any action
taken or proposed to be taken with respect thereto, (iii) setting forth
reasonably detailed calculations demonstrating compliance with Section 6.13
(which shall be required for purposes of determining the Applicable Rate, even
if compliance with the Fixed Charge Coverage Ratio is not then required for
purposes of such Section for the applicable period), (iv) indicating updates to
the Collateral Disclosures to the extent required by the Security Agreement and
(v) stating whether any change in GAAP or in the application thereof has
occurred since the date of the audited financial statements referred to in
Section 3.04 and, if any such change has occurred, specifying the effect of such
change on the financial statements accompanying such certificate;

(e) concurrently with any delivery of financial statements under clause
(a) above, a certificate of the accounting firm that reported on such financial
statements stating whether they obtained knowledge during the course of their
examination of such financial statements of any Default (which certificate may
be limited to the extent required by accounting rules or guidelines);

(f) no later than sixty (60) days after the end of each fiscal year of the
Parent, a copy of the plan and forecast (including a projected consolidated
balance sheet, income statement and cash flow statement) of the Parent for each
quarter of the upcoming fiscal year (the “Projections”) in form reasonably
satisfactory to the Administrative Agent;

(g) (i) within twenty-five (25) days of the end of each calendar month (or, from
and after the date on which Specified Availability is less than the greater of
17.5% of the Aggregate Revolving Commitment and $5,250,000 and until such
subsequent date, if any, on which Specified Availability is greater than the
greater of 17.5% of the aggregate Borrowing Base and $5,250,000 for a period of
thirty (30) consecutive calendar days, within three (3) Business Days after the
end of each calendar week), (ii) at such times as may be necessary to
re-determine Specified Availability pursuant to the definition of Payment
Conditions, (iii) unless delivered pursuant to the preceding clause (g)(ii),
within three (3) Business Days following any Disposition of Accounts (including
pursuant to an Investment or a Restricted Payment), or a reclassification of
Accounts as Excluded Assets, in an aggregate amount greater than $5,000,000,
(iv) on the date on which any Borrowing Base Party is released as a Guarantor
prior to Payment in Full, and (v) as may be requested by the Administrative
Agent at any time that a Default has occurred and is continuing, as of the
period then ended or the applicable date, as the case may be, a Borrowing Base
Certificate and supporting information in connection therewith, together with
any additional reports with respect to the Borrowing Base as the Administrative
Agent may reasonably request;

 

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(h) within twenty-five (25) days of the end of each calendar month, as of the
period then ended, all delivered electronically in a text formatted file
reasonably acceptable to the Administrative Agent;

(i) a detailed aging of the Borrowing Base Parties’ Accounts, including all
invoices aged by invoice date and due date (with an explanation of the terms
offered), prepared in a manner reasonably acceptable to the Administrative
Agent, together with a summary specifying the name, address, and balance due for
each Account Debtor;

(ii) a worksheet of calculations prepared by the Borrowing Base Parties to
determine Eligible Accounts and Eligible Credit Card Accounts Receivable, such
worksheets detailing the Accounts excluded from Eligible Accounts and the Credit
Card Accounts Receivable excluded from Eligible Credit Card Accounts Receivable,
and the reason for any such exclusion;

(iii) a reconciliation of the Borrowing Base Parties’ Accounts between (A) the
amounts shown in the Borrowing Base Parties’ general ledger and financial
statements and the reports delivered pursuant to clause (i) above and (B) the
amounts and dates shown in the reports delivered pursuant to clause (i) above
and the Borrowing Base Certificate delivered pursuant to clause (g) above as of
such date; and

(iv) a reconciliation of the loan balance per the Borrowing Base Parties’
general ledger to the loan balance under this Agreement;

(i) within twenty-five (25) days of the end of each calendar month, as of the
month then ended, a schedule and aging of the Borrowing Base Parties’ accounts
payable, delivered electronically in a text formatted file acceptable to the
Administrative Agent;

(j) at such times as may be requested by the Administrative Agent, but not more
than one time during any fiscal year unless an Event of Default has occurred and
is continuing, an updated customer list for each Borrowing Base Party, which
list shall state the customer’s name, mailing address and phone number,
delivered electronically in a text formatted file acceptable to the
Administrative Agent;

(k) promptly upon the Administrative Agent’s request in connection with a field
exam or if an Event of Default has occurred and is continuing:

(i) copies of invoices issued by the Borrowing Base Parties in connection with
any Accounts, credit memos, shipping and delivery documents, and other
information related thereto; and

(ii) a schedule detailing the balance of all intercompany accounts of the
Borrowing Base Parties;

(l) if weekly delivery of a Borrowing Base Certificate is required pursuant to
Section 5.01(g) above, concurrently with any delivery of any such weekly
Borrowing Base Certificate, and at such other times as may be reasonably
requested by the Administrative Agent, as of the period then ended, the
Borrowing Base Parties’ sales journal, cash receipts journal (identifying trade
and non-trade cash receipts) and debit memo/credit memo journal;

 

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(m) promptly after the same become publicly available, copies of all periodic
and other reports, proxy statements and other materials filed by the Parent or
any Subsidiary with the SEC (or any analogous Governmental Authority in any
relevant jurisdiction), or any Governmental Authority succeeding to any or all
of the functions of the SEC, or with any national or provincial securities
exchange or commission, or distributed by the Parent to its share-holders
generally, as the case may be;

(n) promptly after receipt thereof by any Parent or any Subsidiary, copies of
each notice or other correspondence received from the SEC (or comparable agency
in any applicable non-U.S. jurisdiction) concerning any investigation or
possible investigation or other inquiry by the SEC or such other agency
regarding financial or other operational results of the Parent or any Subsidiary
thereof; and

(o) promptly following any request therefor, (i) such other information
regarding the operations, business affairs and financial condition of any Loan
Party or any of its Subsidiaries, or compliance with the terms of this Agreement
and the other Loan Documents, as the Administrative Agent or any Lender may
reasonably request, and (ii) information and documentation reasonably requested
by the Administrative Agent or any Lender for purposes of compliance with
applicable “know your customer” and anti-money laundering rules and regulations,
including the USA PATRIOT Act and the Beneficial Ownership Regulation may
reasonably request.

Documents required to be delivered pursuant to Section 5.01(a), (b) or (o) (to
the extent any such documents are included in materials otherwise filed with the
SEC) may be delivered electronically and, if so delivered, shall be deemed to
have been delivered on the date (i) on which such materials are publicly
available as posted on the Electronic Data Gathering, Analysis and Retrieval
system (EDGAR); or (ii) on which such documents are posted on the Parent’s
behalf on an Internet or intranet website, if any, to which each Lender and the
Administrative Agent have access (whether a commercial, third-party website or
whether made available by the Administrative Agent); provided that: (A) upon
written request by the Administrative Agent (or any Lender through the
Administrative Agent) to the Parent or the Borrower Representative, the Borrower
Representative shall deliver paper copies of such documents to the
Administrative Agent or such Lender until a written request to cease delivering
paper copies is given by the Administrative Agent or such Lender and (B) the
Parent or the Borrower Representative shall notify the Administrative Agent and
each Lender (by fax or through Electronic Systems) of the posting of any such
documents and provide to the Administrative Agent through Electronic Systems
electronic versions (i.e., soft copies) of such documents. The Administrative
Agent shall have no obligation to request the delivery of or to maintain paper
copies of the documents referred to above, and in any event shall have no
responsibility to monitor compliance by the Parent or any Borrower with any such
request by a Lender for delivery, and each Lender shall be solely responsible
for timely accessing posted documents or requesting delivery of paper copies of
such documents to it and maintaining its copies of such documents.

SECTION 5.02. Notices of Material Events. The Borrowers and the Parent will
furnish to the Administrative Agent and each Lender prompt (but in any event
within any time period that may be specified below) written notice of the
following:

(a) the occurrence of any Default;

(b) receipt of any notice of any investigation by a Governmental Authority or
any litigation or proceeding commenced or threatened against any Loan Party or
any Subsidiary that (i) could reasonably be expected to result in liabilities in
excess of $10,000,000, (ii) seeks injunctive relief, (iii) is asserted or
instituted against any Plan, its fiduciaries or its assets, (iv) alleges
criminal misconduct by any Loan Party or any Subsidiary, (v) alleges the
violation of, or seeks to impose remedies under, any Environmental Law or
related Requirement of Law, or seeks to impose Environmental Liability,
(vi) asserts liability on the part of any Loan Party or any Subsidiary in excess
of $10,000,000 in respect of any

 

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tax, fee, assessment, or other governmental charge, (vii) involves any material
product recall or (viii) is known to a Responsible Officer of any Loan Party and
constitutes a FCC “letter of inquiry”, “notice of apparent liability” or other
FCC enforcement action, in each case concerning a situation that could
reasonably be expected to result in a Material Adverse Effect;

(c) any Lien (other than Liens permitted by Section 6.02) or claim made or
asserted against any portion of the Collateral in the amount of $10,000,000 or
more;

(d) any loss, damage, or destruction to any Collateral in the amount of
$10,000,000 or more, whether or not covered by insurance;

(e) within two (2) Business Days after the occurrence thereof, any Loan Party
entering into a Swap Agreement or an amendment thereto, that extend the term
thereof or materially increase the Loan Parties’ exposure thereunder, together
with copies of all agreements evidencing such Swap Agreement or amendment;

(f) the occurrence of any ERISA Event or Canadian Pension Event that, alone or
together with any other ERISA Events and Canadian Pension Events that have
occurred, could reasonably be expected to result in a Material Adverse Effect;
and

(g) any other development that results, or could reasonably be expected to
result in, a Material Adverse Effect.

Each notice delivered under this Section shall be accompanied by a statement of
a Financial Officer or other executive officer of the Parent setting forth the
details of the event or development requiring such notice and any action taken
or proposed to be taken with respect thereto.

SECTION 5.03. Existence; Conduct of Business. Each Loan Party will, and will
cause each Subsidiary to, (a) do or cause to be done all things necessary to
preserve, renew and keep in full force and effect its legal existence and the
rights, qualifications, licenses, permits, franchises, governmental
authorizations, intellectual property rights, licenses and permits material to
the conduct of its business, and maintain all requisite authority to conduct its
business in each jurisdiction in which its business is conducted, except where
the failure to do so could not be reasonably expected to have a Material Adverse
Effect; provided, however, that the Loan Party shall not be required to preserve
any such right, franchise, licenses and permits of the preservation thereof is
no longer desirable in the conduct of the business of such Person and the loss
thereof is not adverse in any material respect to such Person or the Lenders;
provided, further, that the foregoing shall not prohibit any merger,
amalgamation, consolidation, liquidation or dissolution permitted under
Section 6.03.

SECTION 5.04. Payment of Obligations. Each Loan Party will, and will cause each
Subsidiary to, pay or discharge all Material Indebtedness and all other material
liabilities and obligations, including Taxes, before the same shall become
delinquent or in default, except where (a) the validity or amount thereof is
being contested in good faith by appropriate proceedings, (b) such Loan Party or
Subsidiary has set aside on its books adequate reserves with respect thereto in
accordance with GAAP and (c) the failure to make payment pending such contest
could not reasonably be expected to result in a Material Adverse Effect;
provided, however, that each Loan Party will, and will cause each Subsidiary to,
remit withholding taxes and other payroll taxes to appropriate Governmental
Authorities as and when claimed to be due, notwithstanding the foregoing
exceptions.

SECTION 5.05. Maintenance of Properties. Except where the failure to do so could
not reasonably be expected to have a Material Adverse Effect, each Loan Party
will, and will cause each Subsidiary to, keep and maintain all property material
to the conduct of its business in good working order and condition, ordinary
wear and tear excepted.

 

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SECTION 5.06. Books and Records; Inspection Rights. Each Loan Party will, and
will cause each Subsidiary to, (a) keep proper books of record and account in
which full, true and correct entries in all material respects are made of all
dealings and transactions in relation to its business and activities and
(b) permit any representatives designated by the Administrative Agent or any
Lender (including employees of the Administrative Agent, any Lender or any
consultants, accountants, lawyers, agents and appraisers retained by the
Administrative Agent), upon reasonable prior notice, to visit and inspect its
properties, to conduct at such Loan Party’s premises field examinations of such
Loan Party’s assets, liabilities, books and records, including examining and
making extracts from its books and records, and to discuss its affairs, finances
and condition with its officers and independent accountants, all at such
reasonable times and as often as reasonably requested. Each Loan Party
acknowledges that the Administrative Agent, after exercising its rights of
inspection, may prepare and distribute to the Lenders certain Reports pertaining
to such Loan Party’s assets for internal use by the Administrative Agent and the
Lenders. The Loan Parties shall be responsible for the costs of expenses of
(i) one (1) field examination during any 12-month period and one (1) additional
field examination (for the total of two (2) such field examinations during any
12-month period) conducted at any time after Specified Availability falls below
the greater of (x) $5,250,000 and (y) 17.5% of the Aggregate Revolving
Commitment and (ii) any other field examinations requested by the Loan Parties
in connection with a Permitted Acquisition as described in the definition of
Borrowing Base; provided, that the Loan Parties shall be responsible for the
costs and expenses of all field examinations conducted while an Event of Default
has occurred and is continuing.

SECTION 5.07. Compliance with Laws and Material Contractual Obligations. Each
Loan Party will, and will cause each Subsidiary to, (a) comply with each
Requirement of Law applicable to it or its property (including without
limitation Environmental Laws) and (b) perform in all material respects its
obligations under material agreements to which it is a party , except, in each
case, where the failure to do so, individually or in the aggregate, could not
reasonably be expected to result in a Material Adverse Effect. Each Loan Party
will maintain in effect and enforce policies and procedures designed to ensure
compliance by such Loan Party, its Subsidiaries and their respective directors,
officers, employees and agents with Anti-Corruption Laws and applicable
Sanctions.

SECTION 5.08. Use of Proceeds.

(a) The proceeds of the Loans and the Letters of Credit will be used only for
general corporate purposes (including Permitted Acquisitions) of the Parent and
its Subsidiaries. No part of the proceeds of any Loan and no Letter of Credit
will be used, whether directly or indirectly, for any purpose that entails a
violation of any of the regulations of the Federal Reserve Board, including
Regulations T, U and X.

(b) No Borrower will request any Borrowing or Letter of Credit, and no Borrower
shall use, and each Borrower shall procure that the Parent and its Subsidiaries
and its and their respective directors, officers, employees and agents shall not
use, the proceeds of any Borrowing or Letter of Credit (i) in furtherance of an
offer, payment, promise to pay, or authorization of the payment or giving of
money, or anything else of value, to any Person in violation of any
Anti-Corruption Laws, (ii) for the purpose of funding, financing or facilitating
any activities, business or transaction of or with any Sanctioned Person, or in
any Sanctioned Country, except to the extent permitted for a Person required to
comply with Sanctions, or (iii) in any manner that would result in the violation
of any Sanctions applicable to any party hereto.

 

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SECTION 5.09. [Reserved].

SECTION 5.10. Insurance. Each Loan Party will, and will cause each Subsidiary
to, maintain with financially sound and reputable insurer, such public liability
in insurance, third party property damage insurance, business interruption
insurance and casualty insurance with respect to liabilities, losses or damage
in respect of the assets, properties and businesses of the Loans Parties as may
customarily be carried or maintained under similar circumstances by Persons of
established reputation engaged in similar businesses, in each case in such
amounts (giving effect to self-insurance), with such deductibles covering such
risks and otherwise on such terms and conditions as shall be customary for such
Persons. The Borrowers will furnish to the Administrative Agent, upon the
request of the Administrative Agent, but no less frequently than annually,
information in reasonable detail as to the insurance so maintained.

SECTION 5.11. Casualty and Condemnation. The Borrowers will (a) furnish to the
Administrative Agent and the Lenders prompt written notice of any casualty or
other insured damage to any material portion of the Collateral with a fair
market value exceeding $10,000,000 or the commencement of any action or
proceeding for the taking of any material portion of the Collateral with a fair
market value exceeding $10,000,000 or interest therein under power of eminent
domain or by condemnation or similar proceeding and (b) ensure that the proceeds
of any such event (whether in the form of insurance proceeds, condemnation
awards or otherwise) are collected and applied in accordance with the applicable
provisions of this Agreement and the Collateral Documents.

SECTION 5.12. [Reserved].

SECTION 5.13. Additional Collateral; Further Assurances; Additional Loan
Parties. (a) Subject to applicable Requirements of Law, as promptly as possible
but in any event within thirty (30) days (or such later date as may be agreed
upon by the Administrative Agent) after any Subsidiary of the Parent (other than
an Excluded Subsidiary) is formed or acquired, each Loan Party will cause such
Subsidiary to become a Loan Party by executing a Joinder Agreement and all
applicable Collateral Documents (including an acknowledgment of each
Intercreditor Agreement), such agreements to be accompanied by appropriate
corporate resolutions, other corporate organizational and authorization
documentation and, if requested by the Administrative Agent, legal opinions in
form and substance reasonably satisfactory to the Administrative Agent,
whereupon it shall guarantee repayment of all Secured Obligations. In connection
therewith, the Administrative Agent shall have received all documentation and
other information regarding such newly formed or acquired Subsidiaries as may be
required to comply with the applicable “know your customer” rules and
regulations, including the USA Patriot Act. Upon execution and delivery thereof,
each such Person (i) shall automatically become a Loan Guarantor hereunder and
thereupon shall have all of the rights, benefits, duties and obligations in such
capacity under the Loan Documents and (ii) will grant Liens to the
Administrative Agent, for the benefit of the Administrative Agent and the other
Secured Parties, in any property of such Loan Party which constitutes
Collateral, including any parcel of real property for which a Mortgage and
related deliveries are required in accordance with the terms of the U.S.
Security Agreement and the Canadian Security Agreement (if applicable) and
subject to the terms of the Senior Secured Notes Intercreditor Agreement, but
for the avoidance of doubt, excluding any Excluded Assets; provided, however,
that no Mortgage shall be required to be delivered hereunder that is not also
required to be delivered to secure Senior Secured Notes Obligations or
Additional Secured Indebtedness Obligations.

(b) Without limiting the foregoing, each Loan Party will, and will cause each
Subsidiary to, execute and deliver, or cause to be executed and delivered, to
the Administrative Agent such documents, agreements and instruments, and will
take or cause to be taken such further actions (including the filing and
recording of financing statements, fixture filings, mortgages, deeds of
hypothec, deeds of trust and

 

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other documents and such other actions or deliveries of the type required by
Section 4.01, as applicable), which may be required by any Requirement of Law or
which the Administrative Agent may, from time to time, reasonably request to
carry out the terms and conditions of this Agreement and the other Loan
Documents and to ensure perfection and priority of the Liens created or intended
to be created by the Collateral Documents, all in form and substance reasonably
satisfactory to the Administrative Agent and all at the expense of the Loan
Parties.

(c) If any assets other than Excluded Assets are acquired by any Loan Party
after the Effective Date (other than assets constituting Collateral under the
U.S. Security Agreement and the Canadian Security Agreement, as applicable, that
become subject to the Lien under such security agreements upon acquisition
thereof) or for which no further action is required pursuant to the terms of the
U.S. Security Agreement or the Canadian Security Agreement, the Parent will
(i) notify the Administrative Agent and the Lenders thereof and, if requested by
the Administrative Agent or the Required Lenders, cause such assets to be
subjected to a Lien securing the Secured Obligations and (ii) take, and cause
each applicable Loan Party to take, such actions as shall be necessary or
reasonably requested by the Administrative Agent to grant and perfect such
Liens, including actions described in paragraph (c) of this Section, all at the
expense of the Loan Parties.

(d) Notwithstanding anything to the contrary in this Section or in the
definition of Excluded Subsidiary, if at any time after the Effective Date any
Subsidiary of the Parent that is not a Loan Party shall become party to a
guaranty of, or grant a Lien on any assets to secure the Senior Secured Note
Obligations, any Additional Secured Indebtedness Obligations, any Subordinated
Indebtedness or any other Material Indebtedness of a Loan Party, the Parent
shall promptly notify the Administrative Agent thereof and, concurrently with
such guaranty or grant, shall cause such Subsidiary to comply with
Section 5.13(a), (b) and (c) hereof, as applicable (but without giving effect to
any grace periods provided therein).

ARTICLE VI

Negative Covenants.

Until all of the Obligations have been Paid in Full, each Loan Party executing
this Agreement covenants and agrees, jointly and severally with all of the other
Loan Parties, with the Lenders that:

SECTION 6.01. Indebtedness. No Loan Party will, nor will it permit any
Subsidiary to, create, incur, assume or suffer to exist any Indebtedness,
except:

(a) the Secured Obligations;

(b) (i) Indebtedness existing on the date hereof and set forth in Schedule 6.01
and any extensions, renewals, refinancings and replacements of any such
Indebtedness in accordance with clause (f) hereof, (ii) Indebtedness evidenced
by the Senior Secured Notes subject to the Senior Secured Notes Intercreditor
Agreement, (iii) Indebtedness evidenced by the Convertible Notes, and in the
case of each of the foregoing, any extensions, renewals, refinancings and
replacements of any such Indebtedness in accordance with clause (f) hereof.

(c) Indebtedness of the Parent to any Subsidiary and of any Subsidiary to the
Parent or any other Subsidiary, provided that (i) Indebtedness of any Subsidiary
that is not a Loan Party to any Loan Party shall be subject to Section 6.04 and
(ii) Indebtedness of any Loan Party to any Subsidiary that is not a Loan Party
shall be subordinated to the Secured Obligations in the manner set forth in the
Intercompany Note evidencing such Indebtedness and substantially in the form of
Exhibit H hereto;

 

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(d) Guarantees by the Parent of Indebtedness of any Subsidiary and by any
Subsidiary of Indebtedness of the Parent or any other Subsidiary, provided that
(i) the Indebtedness so Guaranteed is permitted by this Section 6.01, (ii)
Guarantees by any other Loan Party of Indebtedness of any Subsidiary that is not
a Loan Party shall be subject to Section 6.04 and (iii) Guarantees permitted
under this clause (d) shall be subordinated to the Secured Obligations on the
same terms as the Indebtedness so Guaranteed is subordinated to the Secured
Obligations;

(e) Indebtedness of the Borrower or any Subsidiary incurred to finance the
acquisition, construction or improvement of any fixed or capital assets (whether
or not constituting purchase money Indebtedness), including Capital Lease
Obligations and any Indebtedness assumed in connection with the acquisition of
any such assets or secured by a Lien on any such assets prior to the acquisition
thereof, and extensions, renewals and replacements of any such Indebtedness in
accordance with clause (f) below; provided that (i) such Indebtedness is
incurred prior to or within 120 days after such acquisition or the completion of
such construction or improvement and (ii) the aggregate principal amount of
Indebtedness permitted by this clause (e) together with any Refinance
Indebtedness in respect thereof permitted by clause (f) below, shall not exceed
$15,000,000 at any time outstanding;

(f) Indebtedness which represents extensions, renewals, refinancing or
replacements (such Indebtedness being so extended, renewed, refinanced or
replaced being referred to herein as the “Refinance Indebtedness”) of any of the
Indebtedness described in clauses (b), (e) and (i) hereof (such Indebtedness
being referred to herein as the “Original Indebtedness”); provided that (i) such
Refinance Indebtedness does not increase the principal amount or interest rate
of the Original Indebtedness, except by an amount equal to unpaid accrued
interest and premium thereon plus other reasonable amounts paid and fees and
expenses reasonably incurred, in connection with such refinancing, (ii) any
Liens securing such Refinance Indebtedness are not extended to any additional
property of any Loan Party or any Subsidiary, (iii) no Loan Party or any
Subsidiary that is not originally obligated with respect to repayment of such
Original Indebtedness is required to become obligated with respect to such
Refinance Indebtedness, (iv) such Refinance Indebtedness does not result in a
shortening of the average weighted maturity of such Original Indebtedness,
(v) other than in the case of a refinancing of the Convertible Notes, such
Refinance Indebtedness does not mature prior to 180 days after the Maturity
Date, (vi) the terms of such Refinance Indebtedness other than fees and interest
are not less favorable to the obligor thereunder than the original terms of such
Original Indebtedness and (vii) if such Original Indebtedness was subordinated
in right of payment or Lien priority to the Secured Obligations, then the terms
and conditions of such Refinance Indebtedness must include subordination terms
and conditions that are at least as favorable to the Administrative Agent and
the Lenders as those that were applicable to such Original Indebtedness;

(g) Indebtedness owed to any Person providing workers’ compensation, health,
disability or other employee benefits or property, casualty or liability
insurance, pursuant to reimbursement or indemnification obligations to such
Person, in each case incurred in the ordinary course of business;

(h) Indebtedness of any Loan Party in respect of performance bonds, bid bonds,
appeal bonds, surety bonds and similar obligations, in each case provided in the
ordinary course of business;

(i) Indebtedness of any Person that becomes a Subsidiary after the date hereof;
provided that (i) such Indebtedness exists at the time such Person becomes a
Subsidiary and is not created in contemplation of or in connection with such
Person becoming a Subsidiary and (ii) the aggregate principal amount of
Indebtedness permitted by this clause (j), together with any Refinance
Indebtedness in respect thereof permitted by clause (f) above, shall not exceed
$10,000,000 at any time outstanding;

 

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(j) secured Indebtedness of the Loan Parties; provided, that in the case of each
incurrence of such Indebtedness, (i) no Default shall have occurred and be
continuing or would be caused by the incurrence of such Indebtedness, (ii) the
Administrative Agent shall have received a certificate of a Financial Officer of
the Parent demonstrating that the Parent has (A) a Secured Leverage Ratio less
than or equal to 4.00 to 1.00 and (B) a Total Leverage Ratio less than or equal
to 5.25 to 1.00, in each case determined on a pro forma basis after giving
effect to the incurrence of any such Indebtedness, (iii) such Indebtedness is
subject to an Additional Secured Indebtedness Intercreditor Agreement, (iv) such
Indebtedness does not mature prior to 180 days after the Maturity Date and
(v) such Indebtedness is not guaranteed or secured by any Person that is not a
Loan Party;

(k) unsecured Indebtedness of any Loan Party (including Subordinated
Indebtedness); provided, that in the case of each incurrence of such
Indebtedness, (i) no Default shall have occurred and be continuing or would be
caused by the incurrence of such Indebtedness, (ii) the Administrative Agent
shall have received a certificate of a Financial Officer of the Parent
demonstrating that the Parent has a Total Leverage Ratio less than or equal to
5.25 to 1.00 determined on a pro forma basis after giving effect to the
incurrence of any such Indebtedness, (iii) such Indebtedness does not mature
prior to 180 days after the Maturity Date and (iv) such Indebtedness is not
guaranteed by any Person that is not a Loan Party;

(l) Indebtedness incurred pursuant to any Vendor Financing Arrangement in an
aggregate principal amount (taken together with any Refinance Indebtedness
incurred pursuant to Section 6.01(f) above in respect thereof) not to exceed
$50.0 million at any one time outstanding, less the amount of any Indebtedness
outstanding under Section 6.01(e);

(m) Indebtedness under Swap Agreements permitted by Section 6.07;

(n) (A) to the extent constituting Indebtedness, Banking Services Obligations of
a Loan Party in connection with Banking Services arrangements with any Lender or
any Affiliate of such Lender or (B) Indebtedness of the Parent or any Subsidiary
in connection with cash management or similar treasury or custodial arrangements
with any Person;

(o) Indebtedness of the Parent or any Subsidiary supported by a Letter of
Credit, in a principal amount not to exceed the face amount of such Letter of
Credit;

(p) Indebtedness which may be deemed to exist pursuant to any guaranties,
performance, surety, statutory, appeal or similar obligations incurred in the
ordinary course of business;

(q) Indebtedness in respect of netting services, overdraft protections and
otherwise in connection with deposit accounts;

(r) Indebtedness representing deferred compensation to employees of the Parent
or any of its Subsidiaries incurred in the ordinary course of business;

(s) Indebtedness consisting of obligations of the Parent or any Subsidiary under
deferred compensation or similar arrangements incurred by such Person in
connection with Permitted Acquisitions or any other Investment expressly
permitted hereunder;

(t) Indebtedness consisting of (a) financing of insurance premiums or
(b) take-or-pay obligations contained in supply arrangements, in each case, in
the ordinary course of business;

 

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(u) Indebtedness incurred by the Parent or any of its Subsidiaries in respect of
letters of credit, bank guarantees, bankers’ acceptances, or similar instruments
issued or created in the ordinary course of business, including in respect of
workers compensation claims, health, disability or other employee benefits or
property, casualty, or liability insurance or self-insurance or other
Indebtedness with respect to reimbursement-type obligations regarding workers
compensation claims; and

(v) to the extent constituting Subordinated Indebtedness, promissory notes
issued in connection with the repurchase, redemption or other acquisition or
retirement of Equity Interests held by any current or former officer, director
or employee of any Parent or any of its Subsidiaries; provided, that, such
repurchase, redemption, or other acquisition or retirement is permitted by
Section 6.08(a)(vi).

SECTION 6.02. Liens. No Loan Party will, nor will it permit any Subsidiary to,
create, incur, assume or permit to exist any Lien on any property or asset now
owned or hereafter acquired by it, or assign or sell any income or revenues
(including Accounts) or rights in respect of any thereof, except:

(a) Liens created pursuant to any Loan Document;

(b) Permitted Encumbrances;

(c) any Lien on any property or asset of the Parent or any Subsidiary existing
on the date hereof and set forth in Schedule 6.02; provided that (i) such Lien
shall not apply to any other property or asset of the Parent or such Subsidiary
or any other Loan Party or Subsidiary and (ii) such Lien shall secure only those
obligations which it secures on the date hereof, and extensions, renewals and
replacements thereof that do not increase the outstanding principal amount
thereof;

(d) Liens securing the Senior Secured Notes Obligations subject to the Senior
Secured Notes Intercreditor Agreement, and any extensions, renewals,
refinancings and replacements of the Senior Secured Notes Obligations in
accordance with Section 6.01(f); provided that other than with respect to the
Senior Secured Notes Priority Collateral, such Liens are subordinated to the
Liens securing the Secured Obligations in accordance with the terms of the
applicable Intercreditor Agreement.

(e) Liens on fixed or capital assets acquired, constructed or improved by any
Borrower or any Subsidiary; provided that (i) such Liens secure Indebtedness
(including Capital Lease Obligations) permitted by clause (e) of Section 6.01,
(ii) such Liens and the Indebtedness secured thereby are incurred prior to or
within 120 days after such acquisition or the completion of such construction or
improvement, (iii) the Indebtedness secured thereby does not exceed 100% of the
cost of acquiring, constructing or improving such fixed or capital assets and
(iv) such Liens shall not apply to any other property or assets of such Borrower
or Subsidiary or any other Borrower or Subsidiary;

(f) any Lien existing on any property or asset (other than Accounts of a Loan
Party) prior to the acquisition thereof by the Parent or any Subsidiary or
existing on any property or asset (other than Accounts of a Loan Party) of any
Person that becomes a Subsidiary after the date hereof prior to the time such
Person becomes a Subsidiary; provided that (i) such Lien is not created in
contemplation of or in connection with such acquisition or such Person becoming
a Subsidiary, as the case may be, (ii) such Lien shall not apply to any other
property or assets of the Subsidiary and (iii) such Lien shall secure only those
obligations which it secures on the date of such acquisition or the date such
Person becomes a Subsidiary, as the case may be, and extensions, renewals and
replacements thereof that do not increase the outstanding principal amount
thereof;

(g) Liens (i) of a collecting bank arising in the ordinary course of business
under Section 4-210 of the UCC in effect in the relevant jurisdiction covering
only the items being collected upon; (ii) attaching to a commodity trading
account or other commodities brokerage account incurred in the ordinary course
of business and (iii) in favor of banking or other financial institutions
arising as a matter

 

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of law or under customary contractual provisions encumbering deposits or other
funds maintained with such banking or other financial institutions (including
the right of set off and grants of security interests in deposits and/or
securities held by such banking or other financial institution) and that are
within the general parameters customary in the banking industry;

(h) Liens arising out of Sale and Leaseback Transactions permitted by
Section 6.06;

(i) Liens granted by a Subsidiary that is not a Loan Party in favor of any Loan
Party in respect of Indebtedness owed by such Subsidiary;

(j) Liens securing Additional Secured Indebtedness incurred pursuant to
Section 6.01(j) and related Additional Secured Indebtedness Obligations;
provided that Liens on the ABL Priority Collateral and on all or any portion of
any other Collateral are subordinated to the Liens securing the Secured
Obligations in accordance with the terms of the applicable Additional Secured
Indebtedness Intercreditor Agreement;

(k) Liens securing Indebtedness incurred pursuant to Section 6.01(l), which
Liens do not extend to or cover any property or assets of the Parent or any
other Subsidiary Loan Party other than the property or assets acquired pursuant
to such Vendor Financing Arrangement

(l) leases, subleases, nonexclusive licenses or sublicenses granted to third
parties that do not materially interfere with the business of the Parent and its
Subsidiaries, taken as a whole;

(m) any interest or title of a lessor in the property subject to any Capital
Lease or operating lease;

(n) Liens granted by a Subsidiary that is not a Loan Party in favor of the
Parent or any other Loan Party;

(o) Liens encumbering customary initial deposits and margin deposits securing
Indebtedness under Swap Agreements and other forward contracts, options, future
contracts, futures options or similar agreements or arrangements incurred in
each case, not for speculative purposes;

(p) Liens on any cash or Permitted Investments to the extent held in an escrow
account or similar arrangement to be applied for the purpose of funding fees,
expenses or other costs in respect of Indebtedness for which a current
commitment exists;

(q) Liens on insurance policies and the proceeds thereof securing the financing
of the premiums with respect thereto;

(r) Liens securing reimbursement obligations with respect to letters of credit
that solely encumber documents and other property relating to such letters of
credit and the products and proceeds thereof;

(s) Liens in favor of customs and revenue authorities arising as a matter of law
to secure payment of customs duties in connection with the importation of goods;

(t) Liens arising out of conditional sale, title retention, consignment or
similar arrangements for the sale of goods entered into in the ordinary course
of business;

 

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(u) Liens on inventory or other goods and proceeds securing obligations in
respect of bankers’ acceptances issued or created to facilitate the purchase,
shipment or storage of such inventory or other goods;

(v) Liens any property or assets of a Subsidiary that is not a Loan Party
securing Indebtedness of such Subsidiary permitted under Section 6.01 hereof;

(w) any encumbrance or restriction (including, but not limited to, pursuant to
put and call arrangements or buy/sell arrangements) with respect to capital
stock of any joint venture or similar arrangement pursuant to any joint venture
or similar agreement;

(x) Liens that are contractual rights of set-off (i) relating to the
establishment of depository relations with banks not given in connection with
the issuance of Indebtedness, (ii) relating to pooled deposit or sweep accounts
of the Parent or any Subsidiary that permit satisfaction of overdraft, cash
pooling or similar obligations incurred in the ordinary course of business of
the Parent or any Subsidiary or (iii) relating to purchase orders and other
agreements entered into with customers of the Parent or any Subsidiary in the
ordinary course of business; and

(y) other Liens so long as the aggregate outstanding principal amount of the
obligations secured thereby does not exceed $10,000,000.

Notwithstanding the foregoing, none of the Liens permitted pursuant to this
Section 6.02 may at any time attach to any Loan Party’s Accounts, other than
those permitted under clause (a) of the definition of Permitted Encumbrances,
those permitted under clause (a), (b), (d) or (j) above and any Lien in favor of
the Administrative Agent.

SECTION 6.03. Fundamental Changes. (a) No Loan Party will, nor will it permit
any Subsidiary to, merge into or consolidate or amalgamate with any other
Person, or permit any other Person to merge into or consolidate or amalgamate
with it, or otherwise Dispose of all or substantially all/any substantial part
of its assets, or all or substantially all of the stock of any of its
Subsidiaries (in each case, whether now owned or hereafter acquired), or
liquidate or dissolve, except that, if at the time thereof and immediately after
giving effect thereto no Event of Default shall have occurred and be continuing
(i) any Person may merge into a Borrower in a transaction in which the surviving
entity is a Borrower, (ii) any Person may merge into any Subsidiary in a
transaction in which the surviving entity is a Subsidiary and, subject to the
preceding clause (i), if any party to such merger is a Loan Party, such
surviving entity is a Subsidiary or becomes a Subsidiary that is a Loan Party
concurrently with such merger, (iii) any Subsidiary that is not a Loan Party may
liquidate or dissolve if the Parent determines in good faith that such
liquidation or dissolution is in the best interests of the Parent and its
Subsidiaries and is not materially disadvantageous to the Lenders and (iv) any
Loan Parties and their Subsidiaries may consummate an IP Reorganization
Transaction; provided that any such merger involving a Person that is not a
wholly owned Subsidiary immediately prior to such merger shall not be permitted
unless also permitted by Section 6.04.

(b) Without limiting Section 1.08, if any Loan Party that is a limited liability
company consummates a Division, each successor Person resulting from such
Division shall be required to comply with the obligations set forth in
Section 5.13 and the other further assurances obligations set forth in the Loan
Documents and become a Loan Party under this Agreement and the other Loan
Documents.

(c) No Loan Party will, nor will it permit any Subsidiary to, engage in any
business other than businesses of the type conducted by the Parent and its
Subsidiaries on the date hereof and businesses reasonably related or similar
thereto or reasonable extensions thereof.

 

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(d) No Loan Party will, nor will it permit any Subsidiary to, make any change in
its fiscal year from the basis in effect on the Effective Date without the
consent of the Administrative Agent.

SECTION 6.04. Investments, Loans, Advances, Guarantees and Acquisitions. No Loan
Party will, nor will it permit any Subsidiary to, purchase, hold or acquire
(including pursuant to any merger with any Person that was not a Loan Party and
a wholly owned Subsidiary prior to such merger) any evidences of Indebtedness or
Equity Interests of, make or permit to exist any loans or advances to, Guarantee
any obligations of, or make or permit to exist any investment or any other
interest in, any other Person, or purchase or otherwise acquire (in one
transaction or a series of transactions) any assets of any other Person
constituting a business unit (whether through purchase of assets, merger or
otherwise), (each such transaction, an “Investment”), except:

(a) Permitted Investments;

(b) Investments in existence on the date hereof and described in Schedule 6.04;

(c) Investments by the Loan Parties and their Subsidiaries in Equity Interests
in their respective Subsidiaries, provided that (i) any such Equity Interests
held by a Loan Party shall be pledged pursuant to the U.S. Security Agreement or
the Canadian Security Agreement, if and as applicable, and (ii) the aggregate
amount of Investments by Loan Parties in Subsidiaries that are not Loan Parties
(together with outstanding intercompany loans permitted under clause (ii) to the
proviso to Section 6.04(d) and outstanding Guarantees permitted under the
proviso to Section 6.04(e)) shall not exceed $3,000,000 at any time outstanding
(in each case determined without regard to any write-downs or write-offs);

(d) loans or advances made by any Loan Party to any Subsidiary and made by any
Subsidiary to a Loan Party or any other Subsidiary, provided that the amount of
such loans and advances made by Loan Parties to Subsidiaries that are not Loan
Parties (together with outstanding Investments permitted under clause (ii) to
the proviso to Section 6.04(c) and outstanding Guarantees permitted under the
proviso to Section 6.04(e)) shall not exceed $3,000,000 at any time outstanding
(in each case determined without regard to any write-downs or write-offs);

(e) Guarantees constituting Indebtedness permitted by Section 6.01, provided
that the aggregate principal amount of Indebtedness of Subsidiaries that are not
Loan Parties that is Guaranteed by any Loan Party (together with outstanding
Investments permitted under clause (ii) to the proviso to Section 6.04(c) and
outstanding intercompany loans permitted under clause (ii) to the proviso to
Section 6.04(d)) shall not exceed $3,000,000 at any time outstanding (in each
case determined without regard to any write-downs or write-offs);

(f) loans or advances made to directors, officers and employees of the Parent or
any Subsidiary (x) on an arms-length basis in the ordinary course of business
consistent with past practices for travel and entertainment expenses and similar
purposes (other than relocation costs) in an aggregate principal amount not to
exceed $3,500,000 at any one time outstanding, (y) on an arms-length basis in
the ordinary course of business consistent with past practices for relocation
costs and (z) to finance the purchase by such person of Equity Interests of the
Parent or any Subsidiary or otherwise in an aggregate principal amount not to
exceed $250,000 at any one time outstanding;

(g) notes payable, or stock or other securities issued by Account Debtors to a
Loan Party pursuant to negotiated agreements with respect to settlement of such
Account Debtor’s Accounts in the ordinary course of business, consistent with
past practices;

 

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(h) Investments in the form of Swap Agreements permitted by Section 6.07;

(i) Investments of any Person existing at the time such Person becomes a
Subsidiary of the Parent or consolidates or merges with the Parent or any of its
Subsidiaries (including in connection with a Permitted Acquisition) so long as
such Investments were not made in contemplation of such Person becoming a
Subsidiary or of such merger;

(j) Investments permitted to be received in consideration of Dispositions
permitted by Section 6.05;

(k) Investments constituting deposits described in clauses (c) and (d) of the
definition of the term “Permitted Encumbrances”;

(l) Permitted Acquisitions; and

(m) any other Investments (excluding Acquisitions); provided that, both
immediately before and immediately after giving pro forma effect to any such
Investment the Payment Condition shall be satisfied.

SECTION 6.05. Asset Sales. No Loan Party will, nor will it permit any Subsidiary
to, Dispose of any asset, including any Equity Interest owned by it, nor will
the Parent permit any Subsidiary to issue any additional Equity Interest in such
Subsidiary (other than to the Parent or another Subsidiary in compliance with
Section 6.04), except:

(a) Dispositions of (i) inventory in the ordinary course of business and
(ii) used, obsolete, worn out or surplus equipment or property in the ordinary
course of business;

(b) Dispositions of assets to the Parent or any Subsidiary, provided that any
such Dispositions involving a Subsidiary that is not a Loan Party shall be made
in compliance with Section 6.09;

(c) Dispositions of Accounts in connection with the compromise, settlement or
collection thereof;

(d) Dispositions of Permitted Investments and other Investments permitted by
clauses (i) and (k) of Section 6.04;

(e) Dispositions in the form of transfers constituting Investments permitted by
Section 6.04 or Restricted Payments permitted by Section 6.08;

(f) Sale and Leaseback Transactions permitted by Section 6.06;

(g) Dispositions resulting from any casualty or other insured damage to, or any
taking under power of eminent domain or by condemnation or similar proceeding
of, any property or asset of the Parent or any Subsidiary; and

(h) other Dispositions of assets; provided that the aggregate fair market value
of all assets Disposed of in reliance upon this paragraph (g) shall not exceed
$15,000,000 during any fiscal year of the Parent and provided further that all
Dispositions permitted hereby shall be made for fair value and for at least 75%
cash consideration;

 

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(i) leases, subleases, nonexclusive licenses and sublicenses, in each case which
do not materially interfere with the business of the Company and its
Subsidiaries; and

(j) any merger, amalgamation, consolidation, liquidation, wind-up or
dissolution, the purpose of which is to effect a disposition otherwise permitted
in this Section 6.05.

SECTION 6.06. Sale and Leaseback Transactions. No Loan Party will, nor will it
permit any Subsidiary to, enter into any arrangement, directly or indirectly,
whereby it shall sell or transfer any property, real or personal, used or useful
in its business, whether now owned or hereafter acquired, and thereafter rent or
lease such property or other property that it intends to use for substantially
the same purpose or purposes as the property sold or transferred (a “Sale and
Leaseback Transaction”), except for any such sale of any fixed or capital assets
by the Parent or any Subsidiary that is made for cash consideration in an amount
not less than the fair value of such fixed or capital asset and is consummated
within 120 days after the Parent or such Subsidiary acquires or completes the
construction of such fixed or capital asset.

SECTION 6.07. Swap Agreements. No Loan Party will, nor will it permit any
Subsidiary to, enter into any Swap Agreement, except (a) Swap Agreements entered
into to hedge or mitigate risks to which the Parent or any Subsidiary has actual
exposure (other than those in respect of Equity Interests of any Subsidiaries),
and (b) Swap Agreements entered into in order to effectively cap, collar or
exchange interest rates (from fixed to floating rates, from one floating rate to
another floating rate or otherwise) or foreign exchange contract, currency swap
agreement, currency option or other similar agreement or arrangement for the
purpose of fixing, hedging or swapping currency exchange rates with respect to
any interest-bearing liability or investment of the Parent or any Subsidiary.

SECTION 6.08. Restricted Payments; Certain Payments of Indebtedness. (a) No Loan
Party will, nor will it permit any Subsidiary to, declare or make, directly or
indirectly, any Restricted Payment, or incur any obligation (contingent or
otherwise) to do so, except:

(i) the Parent may declare and pay dividends with respect to its common stock
payable solely in additional shares of its common stock, and, with respect to
its preferred stock, payable solely in additional shares of such preferred stock
or in shares of its common stock;

(ii) Subsidiaries may declare and pay dividends ratably to the Parent or any
Subsidiary of the Parent with respect to their Equity Interests;

(iii) the Parent and its Subsidiaries may declare or make, or agree to pay or
make, directly or indirectly, any other Restricted Payments so long as, both
immediately before and after giving pro forma effect to such Restricted Payment
the Payment Conditions shall be satisfied;

(iv) the repurchase of Equity Interests deemed to occur upon the exercise of
stock options to the extent such Equity Interests represent a portion of the
exercise price of those stock options;

(v) payments made or expected to be made by the Company or any Subsidiary in
respect of withholding or similar Taxes payable by any future, present or former
employee, director, officer, manager or consultant and any repurchases of Equity
Interests in consideration of such payments including deemed repurchases in
connection with the exercise of stock options; and

 

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(vi) the repurchase, redemption or other acquisition of the Parent’s Equity
Interests from Persons who are or were formerly the Parent’s directors, officers
or employees or those of any of the Parent’s Subsidiaries, or their respective
estates, heirs, family members, spouses or former spouses, provided, however,
that the aggregate amount of all such repurchases made in any calendar year
pursuant to this Section 6.08(a)(vi) shall not exceed $1,500,000.

(b) No Loan Party will, nor will it permit any Subsidiary to, make or agree to
pay or make, directly or indirectly, any payment or other distribution (whether
in cash, securities or other property) of or in respect of principal of or
interest on any Indebtedness, or any payment or other distribution (whether in
cash, securities or other property), including any sinking fund or similar
deposit, on account of the purchase, redemption, retirement, acquisition,
cancellation or termination of any Indebtedness, except:

(i) payment of Indebtedness created under the Loan Documents;

(ii) payment of (A) regularly scheduled interest and principal payments as and
when due (including at maturity) in respect of any Indebtedness permitted under
Section 6.01, other than payments in respect of Subordinated Indebtedness
prohibited by the subordination provisions thereof, and (B) Indebtedness owing
to the Parent or any Subsidiary that is otherwise permitted hereunder;

(iii) refinancings of Indebtedness to the extent permitted by Section 6.01;

(iv) payment of secured Indebtedness that becomes due as a result of the
voluntary sale or transfer of the property or assets securing such Indebtedness;
and

(v) the conversion (or exchange) of any Indebtedness to (or with) Qualified
Equity Interests of the Parent or Indebtedness of the Parent;

(vi) the prepayment of Indebtedness of the Parent or any Subsidiary with the
proceeds of any issuance of Qualified Equity Interests by the Parent; and

(vii) any other payments or distributions in respect of any Indebtedness, so
long as, immediately before and after giving pro forma effect to such payment or
distribution, the Payment Condition has been satisfied;

provided, however, that no such payment or distribution shall be made in respect
of any Subordinated Indebtedness (including intercompany indebtedness), the
Senior Secured Notes or any other Additional Secured Indebtedness in violation
of the subordination provisions applicable thereto.

SECTION 6.09. Transactions with Affiliates. No Loan Party will, nor will it
permit any Subsidiary to, sell, lease or otherwise transfer any property or
assets to, or purchase, lease or otherwise acquire any property or assets from,
or otherwise engage in any other transactions with, any of its Affiliates,
except (a) transactions that are at prices and on terms and conditions not less
favorable to such Loan Party or such Subsidiary than could be obtained on an
arm’s-length basis from unrelated third parties, (b) transactions between or
among any Loan Parties and their Subsidiaries not involving any other Affiliate,
(c) any Investment permitted by Section 6.04(c), (d) or (e), or any Indebtedness
permitted under Section 6.01(c), (e) any Restricted Payment permitted by
Section 6.08, (f) loans or advances to employees permitted under Section 6.04,
(g) the payment of reasonable fees and expenses to directors of the Parent or
any Subsidiary who are not employees of the Parent or such Subsidiary, and
compensation and employee benefit arrangements paid to, and indemnities provided
for the benefit of, directors, officers or

 

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employees of the Parent and its Subsidiaries in the ordinary course of business,
(h) any issuances of securities or other payments, awards or grants in cash,
securities or otherwise pursuant to, or the funding of, employment agreements,
stock options and stock ownership plans approved by the Parent’s board of
directors and (i) investments by Affiliates in Indebtedness or Equity Interests
of the Parent or a Subsidiary, so long as non-Affiliates were also offered the
opportunity to invest in such Indebtedness or Equity Interests, and transactions
with Affiliates solely in their capacity as holders of Indebtedness or Equity
Interests of the Parent or a Subsidiary, to the extent the opportunity to
participate in such transaction was offered to all holders of the applicable
class (and there are non-Affiliate holders) and such Affiliates are treated no
more favorably than all other holders of such class who elect to participate.

SECTION 6.10. Restrictive Agreements. No Loan Party will, nor will it permit any
Subsidiary to, directly or indirectly, enter into, incur or permit to exist any
agreement or other arrangement that prohibits, restricts or imposes any
condition upon (a) the ability of such Loan Party or any Subsidiary to create,
incur or permit to exist any Lien upon any of its property or assets, or (b) the
ability of any Subsidiary to pay dividends or other distributions with respect
to any of its Equity Interests or to make or repay loans or advances to the
Parent or any other Subsidiary or to Guarantee Indebtedness of the Parent or any
other Subsidiary; provided that (i) the foregoing shall not apply to
restrictions and conditions imposed by any Requirement of Law or by any Loan
Document, (ii) the foregoing shall not apply to restrictions and conditions
existing on the date hereof identified on Schedule 6.10 (but shall apply to any
extension or renewal of, or any amendment or modification expanding the scope
of, any such restriction or condition), (iii) the foregoing shall not apply to
(A) customary restrictions and conditions contained in agreements relating to
the sale of a Subsidiary or a business unit, division, product line or line of
business of a Subsidiary, pending such sale, provided that such restrictions and
conditions apply only to the Subsidiary or the business unit, division, product
line or line of business of such Subsidiary that is to be sold and such sale is
permitted hereunder, and (B) restrictions and conditions imposed by (1) the
Senior Secured Note Documents, (2) any agreement or document governing or
evidencing refinancing Indebtedness in respect of the Senior Secured Notes
permitted under Section 6.01(b) or (f), or (3) any additional Indebtedness
permitted to be incurred under Section 6.01(e) or (f), provided that the
restrictions and conditions contained in any such agreement or document in
clause (2) or (3) above are not less favorable to the Lenders in any material
respect, taken as a whole, than the restrictions and conditions imposed by the
Senior Secured Note Documents, (iv) clause (a) of the foregoing shall not apply
to restrictions or conditions imposed by any agreement relating to secured
Indebtedness permitted by this Agreement if such restrictions or conditions
apply only to the property or assets securing such Indebtedness and such
property or assets do not constitute Collateral, (v) clause (a) of the foregoing
shall not apply to customary provisions in leases and other contracts
restricting the assignment thereof, (vi) the foregoing shall not apply to
agreements entered into by any Subsidiary that is not a Loan Party (including
Foreign Subsidiaries other than Gogo Canada) that are otherwise permitted by
this Agreement (so long as such agreements do not prohibit the Loan Parties from
complying with the other provisions of this Agreement).

SECTION 6.11. Amendment of Material Documents. No Loan Party will, nor will it
permit any of its Subsidiaries to, amend, modify or waive any of its rights
under (a) any agreement or instrument governing or evidencing the Senior Secured
Notes, Additional Secured Indebtedness or any Subordinated Indebtedness or
(b) its certificate/articles of incorporation, by-laws, operating, management or
partnership agreement or other organizational documents, in each case to the
extent such amendment, modification or waiver is adverse in any material respect
to the Lenders, unless consented to by the Administrative Agent (such consent
not to be unreasonably withheld or delayed).

 

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SECTION 6.12. Regulatory Matters.

(a) No FCC License Holder may (i) engage in any material business activities
other than in connection with, incidental to, or in support of, the acquisition
and use of such licenses or its role as licensee and/or licensor of the FCC
Licenses (the “Permitted Activities”) or (ii) incur Indebtedness owed to any
party other than the Parent or another Loan Party (other than Indebtedness owed
to the FCC and incurred in connection with, incidental to, or in support of the
Permitted Activities) or issue Equity Interests, other than in favor of or to
the Parent or a Loan Party, in the case of (i) and (ii) other than as required
by applicable law, rule or regulation; provided that any FCC License Holder may
guarantee any Indebtedness (including any Secured Obligations) of the Parent or
its Subsidiaries permitted to be incurred hereunder; provided, however, that
such guarantee, by its terms or by the terms of any agreement or instrument
pursuant to which such guarantee is outstanding, is subordinated in right of
payment to payment of the Secured Obligations on terms and conditions
satisfactory to the Agent. Any FCC License Holder shall be a Loan Party. All of
the Equity Interests and evidences of Indebtedness of an FCC License Holder owed
to the Parent or another Loan Party shall be pledged as Collateral to secure the
Secured Obligations.

(b) No Loan Party shall operate its businesses other than in accordance with the
Communications Laws and the terms and conditions of the FCC Licenses and other
permits under Communications Laws. Except for any such failure that would not
have a Material Adverse Effect, no Loan Party shall fail to file any report or
application or pay any regulatory, filing or franchise fee pertaining to the
business which is required to be filed with or paid to the FCC or any other
Governmental Authority (including the FAA). No Loan Party shall take any action
that would or could cause the FCC, the FAA or any other Governmental Authority
to institute any proceedings for the cancellation, revocation, non-renewal,
short-term renewal or modification of any of the FCC Licenses or FAA Approvals,
or take or permit to be taken any other action within its control that could
reasonably be expected to result in non-compliance with the requirements of the
Communications Laws or other applicable law if, in either case, to take or
permit to be taken any such action could reasonably be expected to have a
Material Adverse Effect.

SECTION 6.13. Fixed Charge Coverage Ratio. On the first day on which Specified
Availability is less than the greater of 15% of the Aggregate Revolving
Commitment and $4,500,000 (the “Initial Test Date”), and as of the end of each
calendar month thereafter, the Parent will not permit the Fixed Charge Coverage
Ratio to be less than 1.00 to 1.00. Once such covenant is in effect, compliance
with the covenant will be discontinued on the first day immediately succeeding
the last day of the calendar month which includes the thirtieth (30th)
consecutive day on which Specified Availability is greater than the greater of
15% of the Aggregate Revolving Commitment and $4,500,000 so long as (1) no
Default shall have occurred and be continuing and (2) such covenant has not been
in effect and discontinued more than once during the term of this Agreement. For
the avoidance of doubt, the Fixed Charge Coverage Ratio shall be computed on the
Initial Test Date based on the most recent fiscal quarter or calendar month, as
applicable, for which Parent’s financial statements have been (or should have
been) delivered prior to the Initial Test Date.

SECTION 6.14. Canadian Pension Plans. None of the Loan Parties shall, without
the consent of the Lender, maintain, administer, contribute or have any
liability in respect of any Canadian Defined Benefit Plan or acquire an interest
in any Person if such Person sponsors, maintains, administers or contributes to,
or has any liability in respect of any Canadian Defined Benefit Plan.

 

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ARTICLE VII

Events of Default.

If any of the following events (“Events of Default”) shall occur:

(a) the Borrowers shall fail to pay any principal of any Loan or any
reimbursement obligation in respect of any LC Disbursement when and as the same
shall become due and payable, whether at the due date thereof or at a date fixed
for prepayment thereof or otherwise;

(b) the Borrowers shall fail to pay any interest on any Loan or any fee or any
other amount (other than an amount referred to in clause (a) of this Article)
payable under this Agreement or any other Loan Document, when and as the same
shall become due and payable , and such failure shall continue unremedied for a
period of five (5) Business Days;

(c) any representation or warranty made or deemed made by or on behalf of any
Loan Party or any Subsidiary in, or in connection with, this Agreement or any
other Loan Document or any amendment or modification hereof or thereof or waiver
hereunder or thereunder, or in any report, certificate, financial statement or
other document furnished pursuant to or in connection with this Agreement or any
other Loan Document or any amendment or modification hereof or thereof or waiver
hereunder or thereunder, shall prove to have been materially incorrect when made
or deemed made (or incorrect in the case of any representation or warranty
qualified by materiality, including Material Adverse Effect);

(d) any Loan Party shall fail to observe or perform any covenant, condition or
agreement contained in Section 5.02(a), 5.03 (with respect to a Loan Party’s
existence) or 5.08 or in Article VI;

(e) any Loan Party shall fail to observe or perform any covenant, condition or
agreement contained in this Agreement (other than those which constitute a
default under another Section of this Article), and such failure shall continue
unremedied for a period of (i) five (5) Business Days after the earlier of any
Loan Party’s knowledge of such breach or notice thereof from the Administrative
Agent (which notice will be given at the request of any Lender) if such breach
relates to terms or provisions of Section 5.01, 5.02 (other than
Section 5.02(a)), 5.03 through 5.07, 5.10, 5.11 or 5.13 of this Agreement or
(ii) fifteen (15) Business Days after the earlier of any Loan Party’s knowledge
of such breach or notice thereof from the Administrative Agent (which notice
will be given at the request of any Lender) if such breach relates to terms or
provisions of any other Section of this Agreement;

(f) any Loan Party or Subsidiary shall fail to make any payment (whether of
principal or interest and regardless of amount) in respect of any Material
Indebtedness, when and as the same shall become due and payable;

(g) any event or condition occurs that results in any Material Indebtedness
becoming due prior to its scheduled maturity or that enables or permits (with or
without the giving of notice, the lapse of time or both) the holder or holders
of any Material Indebtedness or any trustee or agent on its or their behalf to
cause any Material Indebtedness to become due, or to require the prepayment,
repurchase, redemption or defeasance thereof, prior to its scheduled maturity;
provided that this clause (g) shall not apply to secured Indebtedness that
becomes due as a result of the voluntary sale or transfer of the property or
assets securing such Indebtedness;

(h) an involuntary proceeding shall be commenced or an involuntary petition
shall be filed seeking (i) liquidation, reorganization, arrangement or other
relief in respect of a Loan Party or Subsidiary or its debts, or of a
substantial part of its assets, under any Debtor Relief Law or (ii) the
appointment of a receiver, interim receiver, receiver and manager, monitor,
trustee, custodian, sequestrator, conservator or similar official for any Loan
Party or Subsidiary or for a substantial part of its assets, and, in any such
case, such proceeding or petition shall continue undismissed for sixty (60) days
or an order or decree approving or ordering any of the foregoing shall be
entered;

 

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(i) any Loan Party or Subsidiary shall (i) voluntarily commence any proceeding
or file any plan of arrangement, proposal or proceeding, or make an assignment
into bankruptcy or file any petition seeking liquidation, reorganization or
other relief under any Debtor Relief Laws, (ii) consent to the institution of,
or fail to contest in a timely and appropriate manner, any proceeding or
petition described in clause (h) of this Article, (iii) apply for or consent to
the appointment of a receiver, interim receiver, receiver and manager, monitor,
trustee, custodian, sequestrator, conservator or similar official for such Loan
Party or Subsidiary or for a substantial part of its assets, (iv) file an answer
admitting the material allegations of a petition filed against it in any such
proceeding, (v) make a general assignment for the benefit of creditors or
(vi) take any action for the purpose of effecting any of the foregoing;

(j) any Loan Party or Subsidiary shall become unable, admit in writing its
inability, or publicly declare its intention not to, or fail generally to pay
its debts as they become due;

(k) (i) one or more judgments for the payment of money in an aggregate amount in
excess of $10,000,000 shall be rendered against any Loan Party, any Subsidiary
or any combination thereof and the same shall remain undischarged for a period
of thirty (30) consecutive days during which execution shall not be effectively
stayed, or any action shall be legally taken by a judgment creditor to attach or
levy upon any assets of any Loan Party or Subsidiary to enforce any such
judgment; or (ii) any Loan Party or Subsidiary shall fail within thirty
(30) days to discharge one or more non-monetary judgments or orders which,
individually or in the aggregate, could reasonably be expected to have a
Material Adverse Effect, which judgments or orders, in any such case, are not
stayed on appeal or otherwise being appropriately contested in good faith by
proper proceedings diligently pursued;

(l) (i) an ERISA Event shall have occurred that, when taken together with all
other ERISA Events that have occurred, could reasonably be expected to result in
a Material Adverse Effect, and (ii) a Canadian Pension Event shall have
occurred; or there is an appointment by the appropriate Governmental Authority
of a replacement administrator to administer any Canadian Defined Benefit Plan;
or any Canadian Defined Benefit Plan shall be terminated or a replacement
administrator is appointed; or the Canadian Guarantor or any other Canadian
Subsidiary is in default with respect to payments to a Canadian Defined Benefit
Plan; or the Canadian Guarantor or any other Canadian Subsidiary completely or
partially withdraws from a Canadian Pension Plan or Canadian Defined Benefit
Plan which is a multi-employer pension plan, as defined under the applicable
pension standards legislation; or any Lien arises (save for contribution amounts
not yet due) in connection with any Canadian Pension Plan or Canadian Defined
Benefit Plan, in the case of any event under this clause (ii), when taken
together with all other such events that have occurred, could reasonably be
expected to result in a Material Adverse Effect;

(m) a Change in Control shall occur;

(n) the Loan Guaranty shall fail to remain in full force or effect or any action
shall be taken to discontinue or to assert the invalidity or unenforceability of
the Loan Guaranty, or any Loan Guarantor shall fail to comply with any of the
terms or provisions of the Loan Guaranty to which it is a party, or any Loan
Guarantor shall deny that it has any further liability under the Loan Guaranty
to which it is a party, or shall give notice to such effect, including, but not
limited to notice of termination delivered pursuant to Section 10.08;

(o) except as permitted by the terms of any Collateral Document or any
Intercreditor Agreement, any Collateral Document shall for any reason fail to
create a valid, perfected security interest (with the priority required by the
Senior Notes Intercreditor Agreement) in any Collateral purported to be covered
thereby having a value in excess of $10,000,000;

 

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(p) except as permitted by the terms of any Collateral Document, any Collateral
Document shall fail to remain in full force or effect or any action shall be
taken to discontinue or to assert the invalidity or unenforceability of any
Collateral Document; or

(q) any material provision of any Loan Document for any reason ceases to be
valid, binding and enforceable in accordance with its terms (or any Loan Party
shall challenge the enforceability of any Loan Document or shall assert in
writing, or engage in any action or inaction that evidences its assertion, that
any provision of any of the Loan Documents has ceased to be or otherwise is not
valid, binding and enforceable in accordance with its terms);

then, and in every such event (other than an event with respect to the Borrowers
described in clause (h) or (i) of this Article), and at any time thereafter
during the continuance of such event, the Administrative Agent may, and at the
request of the Required Lenders shall, by notice to the Borrower Representative,
take any or all of the following actions, at the same or different times:
(i) terminate the Commitments, whereupon the Commitments shall terminate
immediately, (ii) declare the Loans then outstanding to be due and payable in
whole (or in part, but ratably as among the Classes of Loans and the Loans of
each Class at the time outstanding, in which case any principal not so declared
to be due and payable may thereafter be declared to be due and payable),
whereupon the principal of the Loans so declared to be due and payable, together
with accrued interest thereon and all fees (including, for the avoidance of
doubt, any break funding payments) and other obligations of the Borrowers
accrued hereunder and under any other Loan Document, shall become due and
payable immediately, in each case without presentment, demand, protest or other
notice of any kind, all of which are hereby waived by the Borrowers, and
(iii) require cash collateral for the LC Exposure in accordance with
Section 2.06(j) hereof; and in the case of any event with respect to the
Borrowers described in clause (h) or (i) of this Article, the Commitments
(including the Swingline Commitment) shall automatically terminate and the
principal of the Loans then outstanding and the cash collateral for the LC
Exposure, together with accrued interest thereon and all fees (including, for
the avoidance of doubt, any break funding payments) and other obligations of the
Borrowers accrued hereunder and under any other Loan Documents, shall
automatically become due and payable, in each case without presentment, demand,
protest or other notice of any kind, all of which are hereby waived by the
Borrowers. Upon the occurrence and during the continuance of an Event of
Default, the Administrative Agent may, and at the request of the Required
Lenders shall, increase the rate of interest applicable to the Loans and other
Obligations as set forth in this Agreement and exercise any rights and remedies
provided to the Administrative Agent under the Loan Documents or at law or
equity, including all remedies provided under the UCC and the PPSA.

ARTICLE VIII

The Administrative Agent.

SECTION 8.01. Authorization and Action.

(a) Each Lender, on behalf of itself and any of its Affiliates that are Secured
Parties and the Issuing Bank hereby irrevocably appoints the entity named as
Administrative Agent in the heading of this Agreement and its successors and
assigns to serve as the administrative agent and collateral agent under the Loan
Documents and each Lender and the Issuing Bank authorizes the Administrative
Agent to take such actions as agent on its behalf and to exercise such powers
under this Agreement and the other Loan Documents as are delegated to the
Administrative Agent under such agreements and to exercise such powers as are
reasonably incidental thereto. In addition, to the extent required under the
laws of any jurisdiction other than within the United States, each Lender and
the Issuing Bank hereby grants to the Administrative Agent any required powers
of attorney to execute and enforce any Collateral Document governed by the laws
of such jurisdiction on such Lender’s or such Issuing Bank’s behalf. Without

 

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limiting the foregoing, each Lender and the Issuing Bank hereby authorizes the
Administrative Agent to execute and deliver, and to perform its obligations
under, each of the Loan Documents to which the Administrative Agent is a party,
and to exercise all rights, powers and remedies that the Administrative Agent
may have under such Loan Documents.

(b) As to any matters not expressly provided for herein and in the other Loan
Documents (including enforcement or collection), the Administrative Agent shall
not be required to exercise any discretion or take any action, but shall be
required to act or to refrain from acting (and shall be fully protected in so
acting or refraining from acting) upon the written instructions of the Required
Lenders (or such other number or percentage of the Lenders as shall be
necessary, pursuant to the terms in the Loan Documents), and, unless and until
revoked in writing, such instructions shall be binding upon each Lender and the
Issuing Bank; provided, however, that the Administrative Agent shall not be
required to take any action that (i) the Administrative Agent in good faith
believes exposes it to liability unless the Administrative Agent receives an
indemnification and is exculpated in a manner satisfactory to it from the
Lenders and the Issuing Bank with respect to such action or (ii) is contrary to
this Agreement or any other Loan Document or applicable law, including any
action that may be in violation of the automatic stay under any requirement of
law relating to bankruptcy, insolvency or reorganization or relief of debtors or
that may effect a forfeiture, modification or termination of property of a
Defaulting Lender in violation of any requirement of law relating to bankruptcy,
insolvency or reorganization or relief of debtors; provided, further, that the
Administrative Agent may seek clarification or direction from the Required
Lenders prior to the exercise of any such instructed action and may refrain from
acting until such clarification or direction has been provided. Except as
expressly set forth in the Loan Documents, the Administrative Agent shall not
have any duty to disclose, and shall not be liable for the failure to disclose,
any information relating to any Borrower, any other Loan Party, any Subsidiary
or any Affiliate of any of the foregoing that is communicated to or obtained by
the Person serving as Administrative Agent or any of its Affiliates in any
capacity. Nothing in this Agreement shall require the Administrative Agent to
expend or risk its own funds or otherwise incur any financial liability in the
performance of any of its duties hereunder or in the exercise of any of its
rights or powers if it shall have reasonable grounds for believing that
repayment of such funds or adequate indemnity against such risk or liability is
not reasonably assured to it.

(c) In performing its functions and duties hereunder and under the other Loan
Documents, the Administrative Agent is acting solely on behalf of the Lenders
and the Issuing Bank (except in limited circumstances expressly provided for
herein relating to the maintenance of the Register), and its duties are entirely
mechanical and administrative in nature. Without limiting the generality of the
foregoing:

(i) the Administrative Agent does not assume and shall not be deemed to have
assumed any obligation or duty or any other relationship as the agent, fiduciary
or trustee of or for any Lender, Issuing Bank or Secured Party other than as
expressly set forth herein and in the other Loan Documents, regardless of
whether a Default or an Event of Default has occurred and is continuing (and it
is understood and agreed that the use of the term “agent” (or any similar term)
herein or in any other Loan Document with reference to the Administrative Agent
is not intended to connote any fiduciary duty or other implied (or express)
obligations arising under agency doctrine of any applicable law, and that such
term is used as a matter of market custom and is intended to create or reflect
only an administrative relationship between contracting parties); additionally,
each Lender agrees that it will not assert any claim against the Administrative
Agent based on an alleged breach of fiduciary duty by the Administrative Agent
in connection with this Agreement and/or the transactions contemplated hereby;

 

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(ii) where the Administrative Agent is required or deemed to act as a trustee in
respect of any Collateral over which a security interest has been created
pursuant to a Loan Document expressed to be governed by the laws of a country
other than the United States of America, or is required or deemed to hold any
Collateral “on trust” pursuant to the foregoing, the obligations and liabilities
of the Administrative Agent to the Secured Parties in its capacity as trustee
shall be excluded to the fullest extent permitted by applicable law;

(iii) to the extent that English law is applicable to the duties of the
Administrative Agent under any of the Loan Documents, Section 1 of the Trustee
Act 2000 of the United Kingdom shall not apply to the duties of the
Administrative Agent in relation to the trusts constituted by that Loan
Document; where there are inconsistencies between the Trustee Act 1925 or the
Trustee Act 2000 of the United Kingdom and the provisions of this Agreement or
such Loan Document, the provisions of this Agreement shall, to the extent
permitted by applicable law, prevail and, in the case of any inconsistency with
the Trustee Act 2000 of the United Kingdom, the provisions of this Agreement
shall constitute a restriction or exclusion for the purposes of that Act;

(iv) nothing in this Agreement or any Loan Document shall require the
Administrative Agent to account to any Lender for any sum or the profit element
of any sum received by the Administrative Agent for its own account; and

(v) notwithstanding the foregoing, the Administrative Agent agrees to act as the
U.S. federal withholding Tax agent in respect of all amounts under the Loan
Documents.

(d) The Administrative Agent may perform any of its duties and exercise its
rights and powers hereunder or under any other Loan Document by or through any
one or more sub-agents appointed by the Administrative Agent. The Administrative
Agent and any such sub-agent may perform any of their respective duties and
exercise their respective rights and powers through their respective Related
Parties. The exculpatory provisions of this Article shall apply to any such
sub-agent and to the Related Parties of the Administrative Agent and any such
sub-agent, and shall apply to their respective activities pursuant to this
Agreement. The Administrative Agent shall not be responsible for the negligence
or misconduct of any sub agent except to the extent that a court of competent
jurisdiction determines in a final and non-appealable judgment that the
Administrative Agent acted with gross negligence or willful misconduct in the
selection of such sub-agent.

(e) No Arranger or Syndication Agent shall have any obligations or duties
whatsoever in such capacity under this Agreement or any other Loan Document and
shall incur no liability hereunder or thereunder in such capacity, but all such
persons shall have the benefit of the indemnities provided for hereunder.

(f) In case of the pendency of any proceeding with respect to any Loan Party
under any Debtor Relief Law, the Administrative Agent (irrespective of whether
the principal of any Loan or any reimbursement obligation in respect of any LC
Disbursement shall then be due and payable as herein expressed or by declaration
or otherwise and irrespective of whether the Administrative Agent shall have
made any demand on any Borrower) shall be entitled and empowered (but not
obligated) by intervention in such proceeding or otherwise:

(i) to file and prove a claim for the whole amount of the principal and interest
owing and unpaid in respect of the Loans, LC Disbursements and all other
Obligations that are owing and unpaid and to file such other documents as may be
necessary or advisable in order to have the claims of the Lenders, the Issuing
Bank and the Administrative Agent (including any claim under Sections 2.12,
2.13, 2.15, 2.17 and 9.03) allowed in such judicial proceeding; and

 

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(ii) to collect and receive any monies or other property payable or deliverable
on any such claims and to distribute the same;

and any custodian, receiver, assignee, trustee, liquidator, sequestrator or
other similar official in any such proceeding is hereby authorized by each
Lender, the Issuing Bank and each other Secured Party to make such payments to
the Administrative Agent and, in the event that the Administrative Agent shall
consent to the making of such payments directly to the Lenders, the Issuing Bank
or the other Secured Parties, to pay to the Administrative Agent any amount due
to it, in its capacity as the Administrative Agent, under the Loan Documents
(including under Section 9.03). Nothing contained herein shall be deemed to
authorize the Administrative Agent to authorize or consent to or accept or adopt
on behalf of any Lender or Issuing Bank any plan of reorganization, arrangement,
adjustment or composition affecting the Obligations or the rights of any Lender
or Issuing Bank or to authorize the Administrative Agent to vote in respect of
the claim of any Lender or Issuing Bank in any such proceeding.

(g) The provisions of this Article are solely for the benefit of the
Administrative Agent, the Lenders and the Issuing Bank, and, except solely to
the extent of the Borrowers’ right to consent pursuant to and subject to the
conditions set forth in this Article, no Borrower nor any Subsidiary, or any of
their respective Affiliates, shall have any rights as a third party beneficiary
under any such provisions. Each Secured Party, whether or not a party hereto,
will be deemed, by its acceptance of the benefits of the Collateral and of the
Guarantees of the Secured Obligations provided under the Loan Documents, to have
agreed to the provisions of this Article.

(h) Without limiting the powers of the Administrative Agent, for the purposes of
holding any hypothec granted to the Attorney (as defined below) pursuant to the
laws of the Province of Québec to secure the prompt payment and performance of
any and all Obligations by any Loan Party, each of the Secured Parties hereby
irrevocably appoints and authorizes the Administrative Agent and, to the extent
necessary, ratifies the appointment and authorization of the Administrative
Agent, to act as the hypothecary representative of the creditors as contemplated
under Article 2692 of the Civil Code of Québec (in such capacity, the
“Attorney”), and to enter into, to take and to hold on their behalf, and for
their benefit, any hypothec, and to exercise such powers and duties that are
conferred upon the Attorney under any related deed of hypothec. The Attorney
shall: (a) have the sole and exclusive right and authority to exercise, except
as may be otherwise specifically restricted by the terms hereof, all rights and
remedies given to the Attorney pursuant to any such deed of hypothec and
applicable law, and (b) benefit from and be subject to all provisions hereof
with respect to the Administrative Agent mutatis mutandis, including, without
limitation, all such provisions with respect to the liability or responsibility
to and indemnification by the Secured Parties and Loan Parties. Any person who
becomes a Secured Party shall, by its execution of an Assignment and Assumption
Agreement, be deemed to have consented to and confirmed the Attorney as the
person acting as hypothecary representative holding the aforesaid hypothecs as
aforesaid and to have ratified, as of the date it becomes a Secured Party, all
actions taken by the Attorney in such capacity. The substitution of the
Administrative Agent pursuant to the provisions of this Section 8.01 shall also
constitute the substitution of the Attorney.

SECTION 8.02. Administrative Agent’s Reliance, Indemnification, Etc.

(a) Neither the Administrative Agent nor any of its Related Parties shall be
(i) liable for any action taken or omitted to be taken by such party, the
Administrative Agent or any of its Related Parties under or in connection with
this Agreement or the other Loan Documents (x) with the consent of or at the
request of the Required Lenders (or such other number or percentage of the
Lenders as shall be necessary, or as the Administrative Agent shall believe in
good faith to be necessary, under the circumstances as provided in the Loan
Documents) or (y) in the absence of its own gross negligence or willful
misconduct (such absence to be presumed unless otherwise determined by a court
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and non-appealable judgment) or (ii) responsible in any manner to any of the
Lenders for any recitals, statements, representations or warranties made by any
Loan Party or any officer thereof contained in this Agreement or any other Loan
Document or in any certificate, report, statement or other document referred to
or provided for in, or received by the Administrative Agent under or in
connection with, this Agreement or any other Loan Document or for the value,
validity, effectiveness, genuineness, enforceability or sufficiency of this
Agreement or any other Loan Document or for any failure of any Loan Party to
perform its obligations hereunder or thereunder.

(b) The Administrative Agent shall be deemed not to have knowledge of any
Default unless and until written notice thereof (stating that it is a “notice of
default”) is given to the Administrative Agent by the Borrower Representative, a
Lender or the Issuing Bank, and the Administrative Agent shall not be
responsible for or have any duty to ascertain or inquire into (i) any statement,
warranty or representation made in or in connection with any Loan Document,
(ii) the contents of any certificate, report or other document delivered
thereunder or in connection therewith, (iii) the performance or observance of
any of the covenants, agreements or other terms or conditions set forth in any
Loan Document or the occurrence of any Default, (iv) the sufficiency, validity,
enforceability, effectiveness or genuineness of any Loan Document or any other
agreement, instrument or document, (v) the satisfaction of any condition set
forth in Article IV or elsewhere in any Loan Document, other than to confirm
receipt of items (which on their face purport to be such items) expressly
required to be delivered to the Administrative Agent or satisfaction of any
condition that expressly refers to the matters described therein being
acceptable or satisfactory to the Administrative Agent, or (vi) the creation,
perfection or priority of Liens on the Collateral.

(c) Without limiting the foregoing, the Administrative Agent (i) may treat the
payee of any promissory note as its holder until such promissory note has been
assigned in accordance with Section 9.04, (ii) may rely on the Register to the
extent set forth in Section 9.04(b), (iii) may consult with legal counsel
(including counsel to the Borrowers), independent public accountants and other
experts selected by it, and shall not be liable for any action taken or omitted
to be taken in good faith by it in accordance with the advice of such counsel,
accountants or experts, (iv) makes no warranty or representation to any Lender
or Issuing Bank and shall not be responsible to any Lender or Issuing Bank for
any statements, warranties or representations made by or on behalf of any Loan
Party in connection with this Agreement or any other Loan Document, (v) in
determining compliance with any condition hereunder to the making of a Loan, or
the issuance of a Letter of Credit, that by its terms must be fulfilled to the
satisfaction of a Lender or an Issuing Bank, may presume that such condition is
satisfactory to such Lender or Issuing Bank unless the Administrative Agent
shall have received notice to the contrary from such Lender or Issuing Bank
sufficiently in advance of the making of such Loan or the issuance of such
Letter of Credit and (vi) shall be entitled to rely on, and shall incur no
liability under or in respect of this Agreement or any other Loan Document by
acting upon, any notice, consent, certificate or other instrument or writing
(which writing may be a fax, any electronic message, Internet or intranet
website posting or other distribution) or any statement made to it orally or by
telephone and believed by it to be genuine and signed or sent or otherwise
authenticated by the proper party or parties (whether or not such Person in fact
meets the requirements set forth in the Loan Documents for being the maker
thereof).

SECTION 8.03. Posting of Communications.

(a) The Borrowers agree that the Administrative Agent may, but shall not be
obligated to, make any Communications available to the Lenders and the Issuing
Bank by posting the Communications on IntraLinks™, DebtDomain, SyndTrak,
ClearPar or any other electronic system chosen by the Administrative Agent to be
its electronic transmission system (the “Approved Electronic Platform”).

 

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(b) Although the Approved Electronic Platform and its primary web portal are
secured with generally-applicable security procedures and policies implemented
or modified by the Administrative Agent from time to time (including, as of the
Effective Date, a user ID/password authorization system) and the Approved
Electronic Platform is secured through a per-deal authorization method whereby
each user may access the Approved Electronic Platform only on a deal-by-deal
basis, each of the Lenders, the Issuing Bank and each Borrower acknowledges and
agrees that the distribution of material through an electronic medium is not
necessarily secure, that the Administrative Agent is not responsible for
approving or vetting the representatives or contacts of any Lender that are
added to the Approved Electronic Platform, and that there may be confidentiality
and other risks associated with such distribution. Each of the Lenders, the
Issuing Bank and each Borrower hereby approves distribution of the
Communications through the Approved Electronic Platform and understands and
assumes the risks of such distribution.

(c) THE APPROVED ELECTRONIC PLATFORM AND THE COMMUNICATIONS ARE PROVIDED “AS IS”
AND “AS AVAILABLE”. THE APPLICABLE PARTIES (AS DEFINED BELOW) DO NOT WARRANT THE
ACCURACY OR COMPLETENESS OF THE COMMUNICATIONS, OR THE ADEQUACY OF THE APPROVED
ELECTRONIC PLATFORM AND EXPRESSLY DISCLAIM LIABILITY FOR ERRORS OR OMISSIONS IN
THE APPROVED ELECTRONIC PLATFORM AND THE COMMUNICATIONS. NO WARRANTY OF ANY
KIND, EXPRESS, IMPLIED OR STATUTORY, INCLUDING ANY WARRANTY OF MERCHANTABILITY,
FITNESS FOR A PARTICULAR PURPOSE, NON-INFRINGEMENT OF THIRD PARTY RIGHTS OR
FREEDOM FROM VIRUSES OR OTHER CODE DEFECTS, IS MADE BY THE APPLICABLE PARTIES IN
CONNECTION WITH THE COMMUNICATIONS OR THE APPROVED ELECTRONIC PLATFORM. IN NO
EVENT SHALL THE ADMINISTRATIVE AGENT, THE ARRANGERS, THE SYNDICATION AGENT OR
ANY OF THEIR RESPECTIVE RELATED PARTIES (COLLECTIVELY, “APPLICABLE PARTIES”)
HAVE ANY LIABILITY TO ANY LOAN PARTY, ANY LENDER, ANY ISSUING BANK OR ANY OTHER
PERSON OR ENTITY FOR DAMAGES OF ANY KIND, INCLUDING DIRECT OR INDIRECT, SPECIAL,
INCIDENTAL OR CONSEQUENTIAL DAMAGES, LOSSES OR EXPENSES (WHETHER IN TORT,
CONTRACT OR OTHERWISE) ARISING OUT OF ANY LOAN PARTY’S OR THE ADMINISTRATIVE
AGENT’S TRANSMISSION OF COMMUNICATIONS THROUGH THE INTERNET OR THE APPROVED
ELECTRONIC PLATFORM.

“Communications” means, collectively, any notice, demand, communication,
information, document or other material provided by or on behalf of any Loan
Party pursuant to any Loan Document or the transactions contemplated therein
which is distributed by the Administrative Agent, any Lender or Issuing Bank by
means of electronic communications pursuant to this Section, including through
an Approved Electronic Platform.

(d) Each Lender and Issuing Bank agrees that notice to it (as provided in the
next sentence) specifying that Communications have been posted to the Approved
Electronic Platform shall constitute effective delivery of the Communications to
such Lender for purposes of the Loan Documents. Each Lender and Issuing Bank
agrees (i) to notify the Administrative Agent in writing (which could be in the
form of electronic communication) from time to time of such Lender’s or Issuing
Bank’s (as applicable) email address to which the foregoing notice may be sent
by electronic transmission and (ii) that the foregoing notice may be sent to
such email address.

(e) Each of the Lenders, Issuing Bank and each Borrower agrees that the
Administrative Agent may, but (except as may be required by applicable law)
shall not be obligated to, store the Communications on the Approved Electronic
Platform in accordance with the Administrative Agent’s generally applicable
document retention procedures and policies.

 

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(f) Nothing herein shall prejudice the right of the Administrative Agent, any
Lender or Issuing Bank to give any notice or other communication pursuant to any
Loan Document in any other manner specified in such Loan Document.

SECTION 8.04. The Administrative Agent Individually. With respect to its
Commitment, Loans (including Swingline Loans) and Letters of Credit, the Person
serving as the Administrative Agent shall have and may exercise the same rights
and powers hereunder and is subject to the same obligations and liabilities as
and to the extent set forth herein for any other Lender or Issuing Bank, as the
case may be. The terms “Issuing Bank”, “Lenders”, “Required Lenders” and any
similar terms shall, unless the context clearly otherwise indicates, include the
Administrative Agent in its individual capacity as a Lender, Issuing Bank or as
one of the Required Lenders, as applicable. The Person serving as the
Administrative Agent and its Affiliates may accept deposits from, lend money to,
own securities of, act as the financial advisor or in any other advisory
capacity for and generally engage in any kind of banking, trust or other
business with, any Loan Party, any Subsidiary or any Affiliate of any of the
foregoing as if such Person was not acting as the Administrative Agent and
without any duty to account therefor to the Lenders or the Issuing Bank.

SECTION 8.05. Successor Administrative Agent.

(a) The Administrative Agent may resign at any time by giving 30 days’ prior
written notice thereof to the Lenders, the Issuing Bank and the Borrower
Representative, whether or not a successor Administrative Agent has been
appointed. Upon any such resignation, the Required Lenders shall have the right,
to appoint a successor Administrative Agent. If no successor Administrative
Agent shall have been so appointed by the Required Lenders and shall have
accepted such appointment within 30 days after the retiring Administrative
Agent’s giving of notice of resignation, then the retiring Administrative Agent
may, on behalf of the Lenders and the Issuing Bank, appoint a successor
Administrative Agent which shall be a bank with an office in New York, New York
or an Affiliate of any such bank. In either case, such appointment shall be
subject to the prior written approval of the Borrower Representative (which
approval may not be unreasonably withheld and shall not be required while an
Event of Default has occurred and is continuing). Upon the acceptance of any
appointment as Administrative Agent by a successor Administrative Agent, such
successor Administrative Agent shall succeed to and become vested with, all the
rights, powers, privileges and duties of the retiring Administrative Agent. Upon
the acceptance of appointment as Administrative Agent by a successor
Administrative Agent, the retiring Administrative Agent shall be discharged from
its duties and obligations under this Agreement and the other Loan Documents.
Prior to any retiring Administrative Agent’s resignation hereunder as
Administrative Agent, the retiring Administrative Agent shall take such action
as may be reasonably necessary to assign to the successor Administrative Agent
its rights as Administrative Agent under the Loan Documents.

(b) Notwithstanding paragraph (a) of this Section, in the event no successor
Administrative Agent shall have been so appointed and shall have accepted such
appointment within 30 days after the retiring Administrative Agent gives notice
of its intent to resign, the retiring Administrative Agent may give notice of
the effectiveness of its resignation to the Lenders, the Issuing Bank and the
Borrowers, whereupon, on the date of effectiveness of such resignation stated in
such notice, (i) the retiring Administrative Agent shall be discharged from its
duties and obligations hereunder and under the other Loan Documents; provided
that, solely for purposes of maintaining any security interest granted to the
Administrative Agent under any Collateral Document for the benefit of the
Secured Parties, the retiring Administrative Agent shall continue to be vested
with such security interest as collateral agent for the benefit of the Secured
Parties and continue to be entitled to the rights set forth in such Collateral
Document and Loan Document, and, in the case of any Collateral in the possession
of the Administrative Agent, shall continue to hold such Collateral, in each
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Agent is appointed and accepts such appointment in accordance with this Section
(it being understood and agreed that the retiring Administrative Agent shall
have no duty or obligation to take any further action under any Collateral
Document, including any action required to maintain the perfection of any such
security interest), and (ii) the Required Lenders shall succeed to and become
vested with all the rights, powers, privileges and duties of the retiring
Administrative Agent; provided that (A) all payments required to be made
hereunder or under any other Loan Document to the Administrative Agent for the
account of any Person other than the Administrative Agent shall be made directly
to such Person and (B) all notices and other communications required or
contemplated to be given or made to the Administrative Agent shall directly be
given or made to each Lender and Issuing Bank. Following the effectiveness of
the Administrative Agent’s resignation from its capacity as such, the provisions
of this Article, Section 2.17(d) and Section 9.03, as well as any exculpatory,
reimbursement and indemnification provisions set forth in any other Loan
Document, shall continue in effect for the benefit of such retiring
Administrative Agent, its sub-agents and their respective Related Parties in
respect of any actions taken or omitted to be taken by any of them while the
retiring Administrative Agent was acting as Administrative Agent and in respect
of the matters referred to in the proviso under clause (a) above.

SECTION 8.06. Acknowledgements of Lenders and Issuing Bank.

(a) Each Lender represents that it is engaged in making, acquiring or holding
commercial loans in the ordinary course of its business and that it has,
independently and without reliance upon the Administrative Agent, the Arrangers,
the Syndication Agent or any other Lender, or any of the Related Parties of any
of the foregoing, and based on such documents and information as it has deemed
appropriate, made its own credit analysis and decision to enter into this
Agreement as a Lender, and to make, acquire or hold Loans hereunder. Each Lender
also acknowledges that it will, independently and without reliance upon the
Administrative Agent, the Arrangers, the Syndication Agent or any other Lender,
or any of the Related Parties of any of the foregoing, and based on such
documents and information (which may contain material, non-public information
within the meaning of the United States securities laws concerning the Borrowers
and their Affiliates) as it shall from time to time deem appropriate, continue
to make its own decisions in taking or not taking action under or based upon
this Agreement, any other Loan Document or any related agreement or any document
furnished hereunder or thereunder.

(b) Each Lender, by delivering its signature page to this Agreement on the
Effective Date, or delivering its signature page to an Assignment and Assumption
or any other Loan Document pursuant to which it shall become a Lender hereunder,
shall be deemed to have acknowledged receipt of, and consented to and approved,
each Loan Document and each other document required to be delivered to, or be
approved by or satisfactory to, the Administrative Agent or the Lenders on the
Effective Date or the effective date of any such Assignment and Assumption or
any other Loan Document pursuant to which it shall have become a Lender
hereunder.

(c) Each Lender hereby agrees that (i) it has requested a copy of each Report
prepared by or on behalf of the Administrative Agent; (ii) the Administrative
Agent (A) makes no representation or warranty, express or implied, as to the
completeness or accuracy of any Report or any of the information contained
therein or any inaccuracy or omission contained in or relating to a Report and
(B) shall not be liable for any information contained in any Report; (iii) the
Reports are not comprehensive audits or examinations, and that any Person
performing any field examination will inspect only specific information
regarding the Loan Parties and will rely significantly upon the Loan Parties’
books and records, as well as on representations of the Loan Parties’ personnel
and that the Administrative Agent undertakes no obligation to update, correct or
supplement the Reports; (iv) it will keep all Reports confidential and strictly
for its internal use, not share the Report with any Loan Party or any other
Person except as otherwise permitted pursuant to this Agreement; and (v) without
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other indemnification provision contained in this Agreement, (A) it will hold
the Administrative Agent and any such other Person preparing a Report harmless
from any action the indemnifying Lender may take or conclusion the indemnifying
Lender may reach or draw from any Report in connection with any extension of
credit that the indemnifying Lender has made or may make to a Borrower, or the
indemnifying Lender’s participation in, or the indemnifying Lender’s purchase
of, a Loan or Loans; and (B) it will pay and protect, and indemnify, defend, and
hold the Administrative Agent and any such other Person preparing a Report
harmless from and against, the claims, actions, proceedings, damages, costs,
expenses, and other amounts (including reasonable attorneys’ fees) incurred by
the Administrative Agent or any such other Person as the direct or indirect
result of any third parties who might obtain all or part of any Report through
the indemnifying Lender.

SECTION 8.07. Collateral Matters.

(a) Except with respect to the exercise of setoff rights in accordance with
Section 9.08 or with respect to a Secured Party’s right to file a proof of claim
in an insolvency proceeding, no Secured Party shall have any right individually
to realize upon any of the Collateral or to enforce any Guarantee of the Secured
Obligations, it being understood and agreed that all powers, rights and remedies
under the Loan Documents may be exercised solely by the Administrative Agent on
behalf of the Secured Parties in accordance with the terms thereof. In its
capacity, the Administrative Agent is a “representative” of the Secured Parties
within the meaning of the term “secured party” as defined in the UCC. In the
event that any Collateral is hereafter pledged by any Person as collateral
security for the Secured Obligations, the Administrative Agent is hereby
authorized, and hereby granted a power of attorney, to execute and deliver on
behalf of the Secured Parties any Loan Documents necessary or appropriate to
grant and perfect a Lien on such Collateral in favor of the Administrative Agent
on behalf of the Secured Parties.

(b) In furtherance of the foregoing and not in limitation thereof, no
arrangements in respect of Banking Services the obligations under which
constitute Secured Obligations and no Swap Agreement the obligations under which
constitute Secured Obligations, will create (or be deemed to create) in favor of
any Secured Party that is a party thereto any rights in connection with the
management or release of any Collateral or of the obligations of any Loan Party
under any Loan Document. By accepting the benefits of the Collateral, each
Secured Party that is a party to any such arrangement in respect of Banking
Services or Swap Agreement, as applicable, shall be deemed to have appointed the
Administrative Agent to serve as administrative agent and collateral agent under
the Loan Documents and agreed to be bound by the Loan Documents as a Secured
Party thereunder, subject to the limitations set forth in this paragraph.

(c) The Secured Parties irrevocably authorize the Administrative Agent, at its
option and in its discretion, to release any Lien on any Collateral to the
extent provided in Section 9.02(c) and to subordinate any Lien on any property
granted to or held by the Administrative Agent under any Loan Document to the
holder of any Lien on such property that is permitted by Section 6.02(b). The
Administrative Agent shall not be responsible for or have a duty to ascertain or
inquire into any representation or warranty regarding the existence, value or
collectability of the Collateral, the existence, priority or perfection of the
Administrative Agent’s Lien thereon or any certificate prepared by any Loan
Party in connection therewith, nor shall the Administrative Agent be responsible
or liable to the Lenders or any other Secured Party for any failure to monitor
or maintain any portion of the Collateral.

SECTION 8.08. Credit Bidding. The Secured Parties hereby irrevocably authorize
the Administrative Agent, at the direction of the Required Lenders, to credit
bid all or any portion of the Obligations (including by accepting some or all of
the Collateral in satisfaction of some or all of the Obligations pursuant to a
deed in lieu of foreclosure or otherwise) and in such manner purchase (either
directly or through one or more acquisition vehicles) all or any portion of the
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thereof conducted under the provisions of the Bankruptcy Code, including under
Sections 363, 1123 or 1129 of the Bankruptcy Code, or any similar laws in any
other jurisdictions to which a Loan Party is subject, or (b) at any other sale,
foreclosure or acceptance of collateral in lieu of debt conducted by (or with
the consent or at the direction of) the Administrative Agent (whether by
judicial action or otherwise) in accordance with any applicable law. In
connection with any such credit bid and purchase, the Obligations owed to the
Secured Parties shall be entitled to be, and shall be, credit bid by the
Administrative Agent at the direction of the Required Lenders on a ratable basis
(with Obligations with respect to contingent or unliquidated claims receiving
contingent interests in the acquired assets on a ratable basis that shall vest
upon the liquidation of such claims in an amount proportional to the liquidated
portion of the contingent claim amount used in allocating the contingent
interests) for the asset or assets so purchased (or for the equity interests or
debt instruments of the acquisition vehicle or vehicles that are issued in
connection with such purchase). In connection with any such bid (i) the
Administrative Agent shall be authorized to form one or more acquisition
vehicles and to assign any successful credit bid to such acquisition vehicle or
vehicles, (ii) each of the Secured Parties’ ratable interests in the Obligations
which were credit bid shall be deemed without any further action under this
Agreement to be assigned to such vehicle or vehicles for the purpose of closing
such sale, (iii) the Administrative Agent shall be authorized to adopt documents
providing for the governance of the acquisition vehicle or vehicles (provided
that any actions by the Administrative Agent with respect to such acquisition
vehicle or vehicles, including any disposition of the assets or equity interests
thereof, shall be governed, directly or indirectly, by, and the governing
documents shall provide for, control by the vote of the Required Lenders or
their permitted assignees under the terms of this Agreement or the governing
documents of the applicable acquisition vehicle or vehicles, as the case may be,
irrespective of the termination of this Agreement and without giving effect to
the limitations on actions by the Required Lenders contained in Section 9.02 of
this Agreement), (iv) the Administrative Agent on behalf of such acquisition
vehicle or vehicles shall be authorized to issue to each of the Secured Parties,
ratably on account of the relevant Obligations which were credit bid, interests,
whether as equity, partnership interests, limited partnership interests or
membership interests, in any such acquisition vehicle and/or debt instruments
issued by such acquisition vehicle, all without the need for any Secured Party
or acquisition vehicle to take any further action, and (v) to the extent that
Obligations that are assigned to an acquisition vehicle are not used to acquire
Collateral for any reason (as a result of another bid being higher or better,
because the amount of Obligations assigned to the acquisition vehicle exceeds
the amount of Obligations credit bid by the acquisition vehicle or otherwise),
such Obligations shall automatically be reassigned to the Secured Parties pro
rata with their original interest in such Obligations and the equity interests
and/or debt instruments issued by any acquisition vehicle on account of such
Obligations shall automatically be cancelled, without the need for any Secured
Party or any acquisition vehicle to take any further action. Notwithstanding
that the ratable portion of the Obligations of each Secured Party are deemed
assigned to the acquisition vehicle or vehicles as set forth in clause
(ii) above, each Secured Party shall execute such documents and provide such
information regarding the Secured Party (and/or any designee of the Secured
Party which will receive interests in or debt instruments issued by such
acquisition vehicle) as the Administrative Agent may reasonably request in
connection with the formation of any acquisition vehicle, the formulation or
submission of any credit bid or the consummation of the transactions
contemplated by such credit bid.

SECTION 8.09. Certain ERISA Matters.

(a) Each Lender (x) represents and warrants, as of the date such Person became a
Lender party hereto, to, and (y) covenants, from the date such Person became a
Lender party hereto to the date such Person ceases being a Lender party hereto,
for the benefit of, the Administrative Agent, the Arrangers and their respective
Affiliates, and not, for the avoidance of doubt, to or for the benefit of any
Borrower or any other Loan Party, that at least one of the following is and will
be true:

(i) such Lender is not using “plan assets” (within the meaning of the Plan Asset
Regulations) of one or more Benefit Plans in connection with the Loans, the
Letters of Credit or the Commitments,

 

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(ii) the transaction exemption set forth in one or more PTEs, such as PTE 84-14
(a class exemption for certain transactions determined by independent qualified
professional asset managers), PTE 95-60 (a class exemption for certain
transactions involving insurance company general accounts), PTE 90-1 (a class
exemption for certain transactions involving insurance company pooled separate
accounts), PTE 91-38 (a class exemption for certain transactions involving bank
collective investment funds) or PTE 96-23 (a class exemption for certain
transactions determined by in-house asset managers), is applicable with respect
to such Lender’s entrance into, participation in, administration of and
performance of the Loans, the Letters of Credit, the Commitments and this
Agreement,

(iii) (A) such Lender is an investment fund managed by a “Qualified Professional
Asset Manager” (within the meaning of Part VI of PTE 84-14), (B) such Qualified
Professional Asset Manager made the investment decision on behalf of such Lender
to enter into, participate in, administer and perform the Loans, the Letters of
Credit, the Commitments and this Agreement, (C) the entrance into, participation
in, administration of and performance of the Loans, the Letters of Credit, the
Commitments and this Agreement satisfies the requirements of sub-sections
(b) through (g) of Part I of PTE 84-14 and (D) to the best knowledge of such
Lender, the requirements of subsection (a) of Part I of PTE 84-14 are satisfied
with respect to such Lender’s entrance into, participation in, administration of
and performance of the Loans, the Letters of Credit, the Commitments and this
Agreement, or

(iv) such other representation, warranty and covenant as may be agreed in
writing between the Administrative Agent, in its sole discretion, and such
Lender.

(b) In addition, unless sub-clause (i) in the immediately preceding clause
(a) is true with respect to a Lender or such Lender has not provided another
representation, warranty and covenant as provided in sub-clause (iv) in the
immediately preceding clause (a), such Lender further (x) represents and
warrants, as of the date such Person became a Lender party hereto, to, and
(y) covenants, from the date such Person became a Lender party hereto to the
date such Person ceases being a Lender party hereto, for the benefit of, the
Administrative Agent, the Arrangers and their respective Affiliates, and not,
for the avoidance of doubt, to or for the benefit of any Borrower or any other
Loan Party, that none of the Administrative Agent, the Arrangers, the
Syndication Agent or any of their respective Affiliates is a fiduciary with
respect to the Collateral or the assets of such Lender (including in connection
with the reservation or exercise of any rights by the Administrative Agent under
this Agreement, any Loan Document or any documents related to hereto or
thereto).

(c) Each of the Administrative Agent and the Arrangers and the Syndication Agent
hereby informs the Lenders that each such Person is not undertaking to provide
investment advice or to give advice in a fiduciary capacity, in connection with
the transactions contemplated hereby, and that such Person has a financial
interest in the transactions contemplated hereby in that such Person or an
Affiliate thereof (i) may receive interest or other payments with respect to the
Loans, the Letters of Credit, the Commitments, this Agreement and any other Loan
Documents, (ii) may recognize a gain if it extended the Loans, the Letters of
Credit or the Commitments for an amount less than the amount being paid for an
interest in the Loans, the Letters of Credit or the Commitments by such Lender
or (iii) may receive fees or other payments in connection with the transactions
contemplated hereby, the Loan Documents or otherwise, including structuring
fees, commitment fees, arrangement fees, facility fees, upfront fees,
underwriting fees, ticking fees, agency fees, administrative agent or collateral
agent fees, utilization fees, minimum usage fees, letter of credit fees,
fronting fees, deal-away or alternate transaction fees, amendment fees,
processing fees, term out premiums, banker’s acceptance fees, breakage or other
early termination fees or fees similar to the foregoing.

 

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SECTION 8.10. Flood Laws. JPMCB has adopted internal policies and procedures
that address requirements placed on federally regulated lenders under the
National Flood Insurance Reform Act of 1994 and related legislation (the “Flood
Laws”). JPMCB, as administrative agent or collateral agent on a syndicated
facility, will post on the applicable electronic platform (or otherwise
distribute to each Lender in the syndicate) documents that it receives in
connection with the Flood Laws. However, JPMCB reminds each Lender and
Participant in the facility that, pursuant to the Flood Laws, each federally
regulated Lender (whether acting as a Lender or Participant in the facility) is
responsible for assuring its own compliance with the flood insurance
requirements.

SECTION 8.11. Intercreditor Agreement. Without limiting the authority granted to
the Administrative Agent in this Article VIII, each Lender (and each Person that
becomes a Lender hereunder), on behalf of itself and its Affiliates, hereby
authorizes and directs the Administrative Agent to enter into, and to amend,
restate, supplement or otherwise modify, any Intercreditor Agreement on behalf
of such Lender and agrees that the Administrative Agent may take such actions on
its behalf as is contemplated by the terms of such Intercreditor Agreement. In
the event of any conflict between the terms of any Intercreditor Agreement and
this Agreement, the terms of such Intercreditor Agreement shall govern and
control.

ARTICLE IX

Miscellaneous.

SECTION 9.01. Notices. (a) Except in the case of notices and other
communications expressly permitted to be given by telephone or Electronic
Systems (and subject in each case to paragraph (b) below), all notices and other
communications provided for herein shall be in writing and shall be delivered by
hand or overnight courier service, mailed by certified or registered mail or
sent by facsimile, as follows:

(i) if to any Loan Party, to the Borrower Representative at:

111 N. Canal Street, Suite 1500

Chicago, Illinois 60606

Attention: General Counsel

Facsimile No: (312) 575-0543

E-mail address: MElias@gogoair.com

With a copy to:

Debevoise & Plimpton LLP

919 Third Avenue

New York, New York 10022

Attention: Matthew E. Kaplan, Esq.

Facsimile No: (212) 521-7334

E-mail address: mekaplan@debevoise.com

 

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(ii) if to the Administrative Agent, JPMCB in its capacity as an Issuing Bank or
the Swingline Lender, to JPMorgan Chase Bank, N.A. at:

ABL - Credit Risk Manager

2200 Ross Ave, 9th FL

Dallas, TX 75201

Attention: Jerome Prince

Facsimile No: (214) 965-4731

E-mail address: jerome.d.prince@jpmorgan.com

(iii) if to any other Lender or Issuing Bank, to it at its address or facsimile
number set forth in its Administrative Questionnaire.

All such notices and other communications (A) sent by hand or overnight courier
service, or mailed by certified or registered mail, shall be deemed to have been
given when received, (B) sent by facsimile shall be deemed to have been given
when sent, provided that if not given during normal business hours of the
recipient, such notice or communication shall be deemed to have been given at
the opening of business on the next Business Day of the recipient, or
(C) delivered through Electronic Systems or Approved Electronic Platforms, as
applicable, to the extent provided in paragraph (b) below shall be effective as
provided in such paragraph.

(b) Notices and other communications to the Lenders hereunder may be delivered
or furnished by using Electronic Systems or Approved Electronic Platforms, as
applicable, or pursuant to procedures approved by the Administrative Agent;
provided that the foregoing shall not apply to notices pursuant to Article II
unless otherwise agreed by the Administrative Agent and the applicable Lender.
Each of the Administrative Agent and the Borrower Representative (on behalf of
the Loan Parties) may, in its discretion, agree to accept notices and other
communications to it hereunder by Electronic Systems or Approved Electronic
Platforms, as applicable, pursuant to procedures approved by it; provided that
approval of such procedures may be limited to particular notices or
communications. Unless the Administrative Agent otherwise proscribes, all such
notices and other communications (i) sent to an e-mail address shall be deemed
received upon the sender’s receipt of an acknowledgement from the intended
recipient (such as by the “return receipt requested” function, as available,
return e-mail or other written acknowledgement), provided that if not given
during the normal business hours of the recipient, such notice or communication
shall be deemed to have been given at the opening of business on the next
Business Day for the recipient, and (ii) posted to an Internet or intranet
website shall be deemed received upon the deemed receipt by the intended
recipient, at its e-mail address as described in the foregoing clause (i), of
notification that such notice or communication is available and identifying the
website address therefor; provided that, for both clauses (i) and (ii) above, if
such notice, e-mail or other communication is not sent during the normal
business hours of the recipient, such notice or communication shall be deemed to
have been sent at the opening of business on the next Business Day of the
recipient.

(c) Any party hereto may change its address, facsimile number or e-mail address
for notices and other communications hereunder by notice to the other parties
hereto.

SECTION 9.02. Waivers; Amendments. (a) No failure or delay by the Administrative
Agent, the Issuing Bank or any Lender in exercising any right or power hereunder
or under any other Loan Document shall operate as a waiver thereof, nor shall
any single or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power, preclude any other or
further exercise thereof or the exercise of any other right or power. The rights
and remedies of the Administrative Agent, the Issuing Bank and the Lenders
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Document are cumulative and are not exclusive of any rights or remedies that
they would otherwise have. No waiver of any provision of any Loan Document or
consent to any departure by any Loan Party therefrom shall in any event be
effective unless the same shall be permitted by paragraph (b) of this Section,
and then such waiver or consent shall be effective only in the specific instance
and for the purpose for which given. Without limiting the generality of the
foregoing, the making of a Loan or issuance of a Letter of Credit shall not be
construed as a waiver of any Default, regardless of whether the Administrative
Agent, any Lender or the Issuing Bank may have had notice or knowledge of such
Default at the time.

(b) Except as provided in the first sentence of Section 2.09(f) (with respect to
any commitment increase) and subject to Section 2.14(c) and Section 9.02(e)
below, neither this Agreement nor any other Loan Document nor any provision
hereof or thereof may be waived, amended or modified except (x) in the case of
this Agreement, pursuant to an agreement or agreements in writing entered into
by the Borrowers and the Required Lenders or (y) in the case of any other Loan
Document, pursuant to an agreement or agreements in writing entered into by the
Administrative Agent and the Loan Party or Loan Parties that are parties
thereto, with the consent of the Required Lenders; provided that no such
agreement shall (i) increase the Commitment of any Lender without the written
consent of such Lender (including any such Lender that is a Defaulting Lender),
(ii) reduce or forgive the principal amount of any Loan or LC Disbursement or
reduce the rate of interest thereon, or reduce or forgive any interest or fees
payable hereunder, without the written consent of each Lender (including any
such Lender that is a Defaulting Lender) directly affected thereby (provided
that any amendment or modification of the financial covenants in this Agreement
(or any defined term used therein) shall not constitute a reduction in the rate
of interest or fees for purposes of this clause (ii)), (iii) postpone any
scheduled date of payment of the principal amount of any Loan or LC
Disbursement, or any date for the payment of any interest, fees or other
Obligations payable hereunder, or reduce the amount of, waive or excuse any such
payment, or postpone the scheduled date of expiration of any Commitment, without
the written consent of each Lender (including any such Lender that is a
Defaulting Lender) directly affected thereby, (iv) change Section 2.09(d) or
Section 2.18(b) or (d) in a manner that would alter the ratable reduction of
Commitments or the manner in which payments are shared, without the written
consent of each Lender (other than any Defaulting Lender), (v) increase the
advance rates set forth in the definition of Borrowing Base or add new
categories of eligible assets, without the written consent of the Supermajority
Lenders (other than any Defaulting Lender), (vi) change any of the provisions of
this Section or the definition of “Required Lenders” or any other provision of
any Loan Document specifying the number or percentage of Lenders (or Lenders of
any Class) required to waive, amend or modify any rights thereunder or make any
determination or grant any consent thereunder, without the written consent of
each Lender (other than any Defaulting Lender) directly affected thereby,
(vii) change Section 2.20 without the consent of each Lender (other than any
Defaulting Lender), (viii) release any Loan Guarantor from its obligation under
its Loan Guaranty (except as otherwise permitted herein or in the other Loan
Documents), without the written consent of each Lender (other than any
Defaulting Lender), or (ix) except as provided in clause (c) of this Section or
in any Collateral Document, release all or substantially all of the Collateral,
without the written consent of each Lender (other than any Defaulting Lender);
provided, further, that no such agreement shall amend, modify or otherwise
affect the rights or duties of the Administrative Agent, the Issuing Bank or the
Swingline Lender hereunder without the prior written consent of the
Administrative Agent, the Issuing Bank or the Swingline Lender, as the case may
be (it being understood that any amendment to Section 2.20 shall require the
consent of the Administrative Agent, the Issuing Bank and the Swingline Lender);
provided further that no such agreement shall amend or modify the provisions of
Section 2.07 or any letter of credit application and any bilateral agreement
between the Borrower Representative and the Issuing Bank regarding the Issuing
Bank’s Issuing Bank Sublimit or the respective rights and obligations between
any Borrower and the Issuing Bank in connection with the issuance of Letters of
Credit without the prior written consent of the Administrative Agent and the
Issuing Bank, respectively. The Administrative Agent may also amend the
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assignments entered into pursuant to Section 9.04. Any amendment, waiver or
other modification of this Agreement or any other Loan Document that by its
terms affects the rights or duties under this Agreement of the Lenders of one or
more Classes (but not the Lenders of any other Class), may be effected by an
agreement or agreements in writing entered into by the Borrowers and the
requisite number or percentage in interest of each affected Class of Lenders
that would be required to consent thereto under this Section if such Class of
Lenders were the only Class of Lenders hereunder at the time.

(c) The Lenders and the Issuing Bank hereby irrevocably authorize the
Administrative Agent, at its option and in its sole discretion, to release any
Liens granted to the Administrative Agent by the Loan Parties on any Collateral
(i) in whole automatically upon the Payment in Full of all Secured Obligations,
and the cash collateralization of all Unliquidated Obligations in a manner
satisfactory to each affected Lender, (ii) constituting property being Disposed
of (including any rights to use intellectual property) to any Person that is not
(either before or after such sale or Disposition) a Loan Party (except in the
case of an IP Reorganization Transaction, which shall result in a release of the
subject Collateral pursuant to this clause (ii)) pursuant to a transaction
permitted by this Agreement, automatically, and, to the extent that the property
being Disposed of constitutes 100% of the Equity Interests of a Subsidiary, the
Administrative Agent is authorized to release any Loan Guaranty provided by such
Subsidiary as provided in Section 10.14, (iii) as to a release of less than all
or substantially all of the Collateral (other than pursuant to clause
(v) below), if (x) as a result of any transaction or occurrence a Loan Party
becomes an Excluded Subsidiary in accordance with the provisions of the Credit
Agreement, in which case the Lien pursuant to the Collateral Documents on all
Collateral of such Loan Party (if any) shall be automatically released or
(b) any Collateral is or becomes an Excluded Asset, in which case the Lien
pursuant to the Collateral Documents on such Excluded Asset shall be
automatically released, (iv) as to a release of all or substantially all of the
Collateral (other than pursuant to clause (v) below), if the release of such
Collateral is approved, authorized or ratified by each of the Lenders, (v) as
provided in the Senior Secured Notes Intercreditor Agreement, (vi) constituting
property leased to a Loan Party under a lease which has expired or been
terminated in a transaction permitted under this Agreement or (vii) as required
to effect any Disposition of such Collateral in connection with any exercise of
remedies of the Administrative Agent and the Lenders pursuant to Article VII.
Except as provided in the preceding sentence, the Administrative Agent will not
release any Liens on Collateral without the prior written authorization of the
Required Lenders or, if required pursuant to Section 9.20, each Lender; provided
that, the Administrative Agent may in its discretion, release its Liens on
Collateral valued in the aggregate not in excess of $2,500,000 during any
calendar year without the prior written authorization of any Lender (it being
agreed that the Administrative Agent may rely conclusively on one or more
certificates of the Borrowers as to the value of any Collateral to be so
released, without further inquiry). Any such release shall not in any manner
discharge, affect, or impair the Obligations or any Liens (other than those
expressly being released) upon (or obligations of the Loan Parties in respect
of) all interests retained by the Loan Parties, including the proceeds of any
sale, all of which shall continue to constitute part of the Collateral. In
addition to and without limiting the provisions of this Section 9.02(c), the
Administrative Agent agrees at the request and sole expense of any Loan Party,
to deliver any such released Collateral (if held by the Administrative Agent) to
such Grantor and the Administrative Agent shall execute, acknowledge and deliver
to such Grantor such releases, instruments or other documents (including UCC
termination statements), and do or cause to be done all other acts, as such
Grantor shall reasonably request to evidence such release; provided that the
Loan Party Disposing of such property certifies to the Administrative Agent that
the Disposition is made in compliance with the terms of this Agreement (and the
Administrative Agent may rely conclusively on any such certificate, without
further inquiry). Any execution and delivery by the Administrative Agent of
documents in connection with any such release shall be without recourse to or
warranty by the Administrative Agent.

 

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(d) If, in connection with any proposed amendment, waiver or consent requiring
the consent of “each Lender” or “each Lender affected thereby,” the consent of
the Required Lenders is obtained, but the consent of other necessary Lenders is
not obtained (any such Lender whose consent is necessary but has not been
obtained being referred to herein as a “Non-Consenting Lender”), then the
Borrowers may elect to replace a Non-Consenting Lender as a Lender party to this
Agreement, provided that, concurrently with such replacement, (i) another bank
or other entity which is reasonably satisfactory to the Borrowers, the
Administrative Agent and the Issuing Bank shall agree, as of such date, to
purchase for cash the Loans and other Obligations due to the Non-Consenting
Lender pursuant to an Assignment and Assumption and to become a Lender for all
purposes under this Agreement and to assume all obligations of the
Non-Consenting Lender to be terminated as of such date and to comply with the
requirements of clause (b) of Section 9.04, and (ii) the Borrowers shall pay to
such Non-Consenting Lender in same day funds on the day of such replacement
(1) all interest, fees and other amounts then accrued but unpaid to such
Non-Consenting Lender by the Borrowers hereunder to and including the date of
termination, including without limitation payments due to such Non-Consenting
Lender under Sections 2.15 and 2.17, and (2) an amount, if any, equal to the
payment which would have been due to such Lender on the day of such replacement
under Section 2.16 had the Loans of such Non-Consenting Lender been prepaid on
such date rather than sold to the replacement Lender. Each party hereto agrees
that an assignment required pursuant to this paragraph may be effected pursuant
to an Assignment and Assumption executed by the Borrower Representative, the
Administrative Agent and the assignee (or, to the extent applicable, an
agreement incorporating an Assignment and Assumption by reference pursuant to an
Approved Electronic Platform as to which the Administrative Agent and such
parties are participants), and the Lender required to make such assignment need
not be a party thereto in order for such assignment to be effective and shall be
deemed to have consented to an be bound by the terms thereof; provided that,
following the effectiveness of any such assignment, the other parties to such
assignment agree to execute and deliver such documents necessary to evidence
such assignment as reasonably requested by the applicable Lender, provided that
any such documents shall be without recourse to or warranty by the parties
thereto.

(e) Notwithstanding anything to the contrary herein the Administrative Agent
may, with the consent of the Borrower Representative only, amend, modify or
supplement this Agreement or any of the other Loan Documents to cure any
ambiguity, omission, mistake, defect or inconsistency.

SECTION 9.03. Expenses; Indemnity; Damage Waiver. (a) The Loan Parties shall,
jointly and severally, pay all (i) reasonable out-of-pocket expenses incurred by
the Administrative Agent and its Affiliates, including the reasonable fees,
charges and disbursements of counsel for the Administrative Agent, in connection
with the syndication and distribution (including, without limitation, via the
internet or through any Electronic System or Approved Electronic Platform) of
the credit facilities provided for herein, the preparation and administration of
the Loan Documents and any amendments, modifications or waivers of the
provisions of the Loan Documents (whether or not the transactions contemplated
hereby or thereby shall be consummated), (ii) reasonable out-of-pocket expenses
incurred by the Issuing Bank in connection with the issuance, amendment, renewal
or extension of any Letter of Credit or any demand for payment thereunder and
(iii) out-of-pocket expenses incurred by the Administrative Agent, the Issuing
Bank or any Lender, including the fees, charges and disbursements of any counsel
for the Administrative Agent, the Issuing Bank or any Lender, in connection with
the enforcement, collection or protection of its rights in connection with the
Loan Documents, including its rights under this Section, or in connection with
the Loans made or Letters of Credit issued hereunder, including all such
out-of-pocket expenses incurred during any workout, restructuring or
negotiations in respect of such Loans or Letters of Credit. Expenses being
reimbursed by the Loan Parties under this Section include, without limiting the
generality of the foregoing, fees, costs and expenses incurred in connection
with:

(A) appraisals and insurance reviews;

 

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(B) field examinations and the preparation of Reports based on the fees charged
by a third party retained by the Administrative Agent or the internally
allocated fees for each Person employed by the Administrative Agent with respect
to each field examination;

(C) background checks regarding senior management and/or key investors, as
deemed necessary or appropriate in the sole discretion of the Administrative
Agent;

(D) Taxes, fees and other charges for (1) lien and title searches and title
insurance and (2) recording the Mortgages, filing financing statements and
continuations, and other actions to perfect, protect, and continue the
Administrative Agent’s Liens;

(E) sums paid or incurred to take any action required of any Loan Party under
the Loan Documents that such Loan Party fails to pay or take; and

(F) forwarding loan proceeds, collecting checks and other items of payment, and
establishing and maintaining the accounts and lock boxes, and costs and expenses
of preserving and protecting the Collateral.

All of the foregoing fees, costs and expenses may be charged to the Borrowers as
Revolving Loans or to another deposit account, all as described in
Section 2.18(c).

(b) The Loan Parties shall, jointly and severally, indemnify the Administrative
Agent, the Arrangers, the Syndication Agent, the Issuing Bank and each Lender,
and each Related Party of any of the foregoing Persons (each such Person being
called an “Indemnitee”) against, and hold each Indemnitee harmless from, any and
all losses, claims, damages, penalties, incremental taxes, liabilities and
related expenses, including the fees, charges and disbursements of any counsel
for any Indemnitee, incurred by or asserted against any Indemnitee arising out
of, in connection with, or as a result of (i) the execution or delivery of the
Loan Documents or any agreement or instrument contemplated thereby, the
performance by the parties hereto of their respective obligations thereunder or
the consummation of the Transactions or any other transactions contemplated
hereby, (ii) any Loan or Letter of Credit or the use of the proceeds therefrom
(including any refusal by the Issuing Bank to honor a demand for payment under a
Letter of Credit if the documents presented in connection with such demand do
not strictly comply with the terms of such Letter of Credit), (iii) any actual
or alleged presence or Release of Hazardous Materials on or from any property
owned or operated by a Loan Party or a Subsidiary, or any Environmental
Liability related in any way to a Loan Party or a Subsidiary, (iv) the failure
of a Loan Party to deliver to the Administrative Agent the required receipts or
other required documentary evidence with respect to a payment made by a Loan
Party for Taxes pursuant to Section 2.17, or (v) any actual or prospective
claim, litigation, investigation, arbitration or proceeding relating to any of
the foregoing, whether or not such claim, litigation, investigation, arbitration
or proceeding is brought by any Loan Party or their respective equity holders,
Affiliates, creditors or any other third Person and whether based on contract,
tort or any other theory and regardless of whether any Indemnitee is a party
thereto; provided that such indemnity shall not, as to any Indemnitee, be
available to the extent that such losses, claims, damages, penalties,
liabilities or related expenses are determined by a court of competent
jurisdiction by final and non-appealable judgment to have resulted from the
gross negligence or willful misconduct of such Indemnitee. This Section 9.03(b)
shall not apply with respect to Taxes other than any Taxes that represent losses
or damages arising from any non-Tax claim.

(c) Each Lender severally agrees to pay any amount required to be paid by any
Loan Party under paragraph (a) or (b) of this Section 9.03 to the Administrative
Agent, each Issuing Bank and the Swingline Lender, and each Related Party of any
of the foregoing Persons (each, an “Agent Indemnitee”) (to the extent not
reimbursed by a Loan Party and without limiting the obligation of any Loan Party
to do

 

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so), ratably according to their respective Applicable Percentage in effect on
the date on which indemnification is sought under this Section (or, if
indemnification is sought after the date upon which the Commitments shall have
terminated and the Loans shall have been paid in full, ratably in accordance
with such Applicable Percentage immediately prior to such date), from and
against any and all losses, claims, damages, liabilities and related expenses,
including the fees, charges and disbursements of any kind whatsoever that may at
any time (whether before or after the payment of the Loans) be imposed on,
incurred by or asserted against such Agent Indemnitee in any way relating to or
arising out of the Commitments, this Agreement, any of the other Loan Documents
or any documents contemplated by or referred to herein or therein or the
transactions contemplated hereby or thereby or any action taken or omitted by
such Agent Indemnitee under or in connection with any of the foregoing; provided
that the unreimbursed expense or indemnified loss, claim, damage, liability or
related expense, as the case may be, was incurred by or asserted against such
Agent Indemnitee in its capacity as such; provided, further, that no Lender
shall be liable for the payment of any portion of such liabilities, obligations,
losses, damages, penalties, actions, judgments, suits, costs, expenses or
disbursements that are found by a final and non-appealable decision of a court
of competent jurisdiction to have resulted from such Agent Indemnitee’s gross
negligence or willful misconduct. The agreements in this Section shall survive
the termination of this Agreement and the Payment in Full of the Secured
Obligations.

(d) To the extent permitted by applicable law, no Loan Party shall assert, and
each Loan Party hereby waives, any claim against any Indemnitee (i) for any
damages arising from the use by others of information or other materials
obtained through telecommunications, electronic or other information
transmission systems (including the Internet) or (ii) on any theory of
liability, for special, indirect, consequential or punitive damages (as opposed
to direct or actual damages) arising out of, in connection with, or as a result
of, this Agreement, any other Loan Document or any agreement or instrument
contemplated hereby or thereby, the Transactions, any Loan or Letter of Credit
or the use of the proceeds thereof; provided that, nothing in this paragraph
(d) shall relieve any Loan Party of any obligation it may have to indemnify an
Indemnitee against special, indirect, consequential or punitive damages asserted
against such Indemnitee by a third party.

(e) All amounts due under this Section shall be payable promptly but in any
event not later than fifteen (15) days after written demand therefor.

SECTION 9.04. Successors and Assigns. (a) The provisions of this Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns permitted hereby (including any Affiliate of
the Issuing Bank that issues any Letter of Credit), except that (i) no Borrower
may assign or otherwise transfer any of its rights or obligations hereunder
without the prior written consent of each Lender (and any attempted assignment
or transfer by any Borrower without such consent shall be null and void) and
(ii) no Lender may assign or otherwise transfer its rights or obligations
hereunder except in accordance with this Section. Nothing in this Agreement,
expressed or implied, shall be construed to confer upon any Person (other than
the parties hereto, their respective successors and assigns permitted hereby
(including any Affiliate of the Issuing Bank that issues any Letter of Credit),
Participants (to the extent provided in paragraph (c) of this Section) and, to
the extent expressly contemplated hereby, the Related Parties of each of the
Administrative Agent, the Issuing Bank and the Lenders) any legal or equitable
right, remedy or claim under or by reason of this Agreement.

 

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(b) (i) Subject to the conditions set forth in paragraph (b)(ii) below, any
Lender may assign to one or more Persons (other than an Ineligible Institution)
all or a portion of its rights and obligations under this Agreement (including
all or a portion of its Commitment, participations in Letters of Credit and the
Loans at the time owing to it) with the prior written consent (such consent not
to be unreasonably withheld) of:

(A) the Borrower Representative, provided that the Borrower Representative shall
be deemed to have consented to any such assignment of all or a portion of the
Revolving Loans and Commitments unless it shall object thereto by written notice
to the Administrative Agent within ten (10) Business Days after having received
notice thereof, and provided further that no consent of the Borrower
Representative shall be required for an assignment to a Lender, an Affiliate of
a Lender, an Approved Fund or, if an Event of Default has occurred and is
continuing, any other assignee;

(B) the Administrative Agent;

(C) the Issuing Bank; and

(D) the Swingline Lender.

(ii) Assignments shall be subject to the following additional conditions:

(A) except in the case of an assignment to a Lender or an Affiliate of a Lender
or an Approved Fund or an assignment of the entire remaining amount of the
assigning Lender’s Commitment or Loans of any Class, the amount of the
Commitment or Loans of the assigning Lender subject to each such assignment
(determined as of the date the Assignment and Assumption with respect to such
assignment is delivered to the Administrative Agent) shall not be less than
$5,000,000 unless each of the Borrower Representative and the Administrative
Agent otherwise consent, provided that no such consent of the Borrower
Representative shall be required if an Event of Default has occurred and is
continuing;

(B) each partial assignment shall be made as an assignment of a proportionate
part of all the assigning Lender’s rights and obligations under this Agreement;

(C) the parties to each assignment shall execute and deliver to the
Administrative Agent (x) an Assignment and Assumption or (y) to the extent
applicable, an agreement incorporating an Assignment and Assumption by reference
pursuant to an Approved Electronic Platform as to which the Administrative Agent
and the parties to the Assignment and Assumption are participants, together with
a processing and recordation fee of $3,500; and

(D) the assignee, if it shall not be a Lender, shall deliver to the
Administrative Agent an Administrative Questionnaire in which the assignee
designates one or more credit contacts to whom all syndicate-level information
(which may contain material non-public information about the Parent, the other
Loan Parties and their Related Parties or their respective securities) will be
made available and who may receive such information in accordance with the
assignee’s compliance procedures and applicable laws, including Federal and
state securities laws.

For the purposes of this Section 9.04(b), the terms “Approved Fund” and
“Ineligible Institution” have the following meanings:

“Approved Fund” means any Person (other than a natural person) that is engaged
in making, purchasing, holding or investing in bank loans and similar extensions
of credit in the ordinary course of its business and that is administered or
managed by (a) a Lender, (b) an Affiliate of a Lender or (c) an entity or an
Affiliate of an entity that administers or manages a Lender.

 

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“Ineligible Institution” means (a) a natural person, (b) a Defaulting Lender or
its Lender Parent, (c) a company, investment vehicle or trust for, or owned and
operated for the primary benefit of, a natural person or relative(s) thereof;
provided that, with respect to clause (c), such company, investment vehicle or
trust shall not constitute an Ineligible Institution if it (x) has not been
established for the primary purpose of acquiring any Loans or Commitments,
(y) is managed by a professional advisor, who is not such natural person or a
relative thereof, having significant experience in the business of making or
purchasing commercial loans, and (z) has assets greater than $25,000,000 and a
significant part of its activities consist of making or purchasing commercial
loans and similar extensions of credit in the ordinary course of its business or
(d) a Loan Party or a Subsidiary or other Affiliate of a Loan Party.

(iii) Subject to acceptance and recording thereof pursuant to paragraph (b)(iv)
of this Section, from and after the effective date specified in each Assignment
and Assumption, the assignee thereunder shall be a party hereto and, to the
extent of the interest assigned by such Assignment and Assumption, have the
rights and obligations of a Lender under this Agreement, and the assigning
Lender thereunder shall, to the extent of the interest assigned by such
Assignment and Assumption, be released from its obligations under this Agreement
(and, in the case of an Assignment and Assumption covering all of the assigning
Lender’s rights and obligations under this Agreement, such Lender shall cease to
be a party hereto but shall continue to be entitled to the benefits (and to have
the obligation) of a Lender under Sections 2.15, 2.16, 2.17 and 9.03). Any
assignment or transfer by a Lender of rights or obligations under this Agreement
that does not comply with this Section shall be treated for purposes of this
Agreement as a sale by such Lender of a participation in such rights and
obligations in accordance with paragraph (c) of this Section.

(iv) The Administrative Agent, acting for this purpose as a non-fiduciary agent
of the Borrowers, shall maintain at one of its offices a copy of each Assignment
and Assumption delivered to it and a register for the recordation of the names
and addresses of the Lenders, and the Commitment of, and principal amount of the
Loans and LC Disbursements owing to, each Lender pursuant to the terms hereof
from time to time (the “Register”). The entries in the Register shall be
conclusive, and the Borrowers, the Administrative Agent, the Issuing Bank and
the Lenders shall treat each Person whose name is recorded in the Register
pursuant to the terms hereof as a Lender hereunder for all purposes of this
Agreement, notwithstanding notice to the contrary. The Register shall be
available for inspection by the Borrowers, the Issuing Bank and any Lender, at
any reasonable time and from time to time upon reasonable prior notice.

(v) Upon its receipt of (x) a duly completed Assignment and Assumption executed
by an assigning Lender and an assignee, or (y) to the extent applicable, an
agreement incorporating an Assignment and Assumption by reference pursuant to an
Approved Electronic Platform as to which the Administrative Agent and the
parties to the Assignment and Assumption are participants, the assignee’s
completed Administrative Questionnaire (unless the assignee shall already be a
Lender hereunder), the processing and recordation fee referred to in paragraph
(b) of this Section and any written consent to such assignment required by
paragraph (b) of this Section, the Administrative Agent shall accept such
Assignment and Assumption and record the information contained therein in the
Register; provided that if either the assigning Lender or the assignee shall
have failed to make any payment required to be made by it pursuant to
Section 2.05, 2.06(d) or (e), 2.07(b), 2.18(d) or 9.03(c), the Administrative
Agent shall have no obligation to accept such Assignment and Assumption and
record the information therein in the Register unless and until such payment
shall have been made in full, together with all accrued interest thereon. No
assignment shall be effective for purposes of this Agreement unless it has been
recorded in the Register as provided in this paragraph.

 

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(c) Any Lender may, without the consent of, or notice to, the Borrowers, the
Administrative Agent, the Issuing Bank or the Swingline Lender, sell
participations to one or more banks or other entities (a “Participant”) other
than an Ineligible Institution in all or a portion of such Lender’s rights and
obligations under this Agreement (including all or a portion of its Commitment
and/or the Loans owing to it); provided that (i) such Lender’s obligations under
this Agreement shall remain unchanged; (ii) such Lender shall remain solely
responsible to the other parties hereto for the performance of such obligations;
and (iii) the Borrowers, the Administrative Agent, the Issuing Bank and the
other Lenders shall continue to deal solely and directly with such Lender in
connection with such Lender’s rights and obligations under this Agreement. Any
agreement or instrument pursuant to which a Lender sells such a participation
shall provide that such Lender shall retain the sole right to enforce this
Agreement and to approve any amendment, modification or waiver of any provision
of this Agreement; provided that such agreement or instrument may provide that
such Lender will not, without the consent of the Participant, agree to any
amendment, modification or waiver described in the first proviso to
Section 9.02(b) that affects such Participant. The Borrowers agree that each
Participant shall be entitled to the benefits of Sections 2.15, 2.16 and 2.17
(subject to the obligations and limitations therein, including the requirements
under Section 2.17(f) and (g) (it being understood that the documentation
required under Section 2.17(f) shall be delivered to the participating Lender
and the information and documentation required under Section 2.17(g) will be
delivered to the Borrowers and the Administrative Agent)) to the same extent as
if it were a Lender and had acquired its interest by assignment pursuant to
paragraph (b) of this Section; provided that (A) such Participant agrees to be
subject to the provisions of Sections 2.18 and 2.19 as if it were an assignee
under paragraph (b) of this Section; and (B) the Borrowers shall not be required
to make any greater payment under Section 2.15 or 2.17, with respect to any
participation, than it would have been obligated to make in the absence of any
participation.

Each Lender that sells a participation agrees, at the Borrowers’ request and
expense, to use reasonable efforts to cooperate with the Borrowers to effectuate
the provisions of Section 2.19(b) with respect to any Participant. To the extent
permitted by law, each Participant also shall be entitled to the benefits of
Section 9.08 as though it were a Lender, provided such Participant agrees to be
subject to Section 2.18(c) as though it were a Lender. Each Lender that sells a
participation shall, acting for itself and, solely for this purpose, as a
non-fiduciary agent of the Borrowers, maintain a register on which it enters the
name and address of each Participant and the principal amounts (and stated
interest) of each Participant’s interest in the Loans or other obligations under
this Agreement or any other Loan Document (the “Participant Register”); provided
that no Lender shall have any obligation to disclose all or any portion of the
Participant Register (including the identity of any Participant or any
information relating to a Participant’s interest in any Commitments, Loans,
Letters of Credit or its other obligations under any Loan Document) to any
Person except to the extent that such disclosure is necessary to establish that
such Commitment, Loan, Letter of Credit or other obligation is in registered
form under Section 5f.103-1(c) of the United States Treasury Regulations. The
entries in the Participant Register shall be conclusive absent manifest error,
and such Lender shall treat each Person whose name is recorded in the
Participant Register as the owner of such participation for all purposes of this
Agreement notwithstanding any notice to the contrary. For the avoidance of
doubt, the Administrative Agent (in its capacity as Administrative Agent) shall
have no responsibility for maintaining a Participant Register.

(d) Any Lender may at any time pledge or assign a security interest in all or
any portion of its rights under this Agreement to secure obligations of such
Lender, including without limitation any pledge or assignment to secure
obligations to a Federal Reserve Bank, and this Section shall not apply to any
such pledge or assignment of a security interest; provided that no such pledge
or assignment of a security interest shall release a Lender from any of its
obligations hereunder or substitute any such pledgee or assignee for such Lender
as a party hereto.

 

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SECTION 9.05. Survival. All covenants, agreements, representations and
warranties made by the Loan Parties in the Loan Documents and in the
certificates or other instruments delivered in connection with or pursuant to
this Agreement or any other Loan Document shall be considered to have been
relied upon by the other parties hereto and shall survive the execution and
delivery of the Loan Documents and the making of any Loans and issuance of any
Letters of Credit, regardless of any investigation made by any such other party
or on its behalf and notwithstanding that the Administrative Agent, the Issuing
Bank or any Lender may have had notice or knowledge of any Default or incorrect
representation or warranty at the time any credit is extended hereunder, and
shall continue in full force and effect as long as the principal of or any
accrued interest on any Loan or any fee or any other amount payable under this
Agreement is outstanding and unpaid or any Letter of Credit is outstanding and
so long as the Commitments have not expired or terminated. The provisions of
Sections 2.15, 2.16, 2.17 and 9.03 and Article VIII shall survive and remain in
full force and effect regardless of the consummation of the transactions
contemplated hereby, the repayment of the Loans, the expiration or termination
of the Letters of Credit and the Commitments or the termination of this
Agreement or any other Loan Document or any provision hereof or thereof.

SECTION 9.06. Counterparts; Integration; Effectiveness; Electronic Execution.
(a) This Agreement may be executed in counterparts (and by different parties
hereto on different counterparts), each of which shall constitute an original,
but all of which when taken together shall constitute a single contract. This
Agreement, the other Loan Documents and any separate letter agreements with
respect to fees payable to the Administrative Agent constitute the entire
contract among the parties relating to the subject matter hereof and supersede
any and all previous agreements and understandings, oral or written, relating to
the subject matter hereof. Except as provided in Section 4.01, this Agreement
shall become effective when it shall have been executed by the Administrative
Agent and when the Administrative Agent shall have received counterparts hereof
which, when taken together, bear the signatures of each of the other parties
hereto, and thereafter shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and assigns.

(b) Delivery of an executed counterpart of a signature page of this Agreement by
telecopy, emailed pdf. or any other electronic means that reproduces an image of
the actual executed signature page shall be effective as delivery of a manually
executed counterpart of this Agreement. The words “execution,” “signed,”
“signature,” “delivery,” and words of like import in or relating to any document
to be signed in connection with this Agreement and the transactions contemplated
hereby or thereby shall be deemed to include Electronic Signatures, deliveries
or the keeping of records in electronic form, each of which shall be of the same
legal effect, validity or enforceability as a manually executed signature,
physical delivery thereof or the use of a paper-based recordkeeping system, as
the case may be, to the extent and as provided for in any applicable law,
including the Federal Electronic Signatures in Global and National Commerce Act,
the New York State Electronic Signatures and Records Act, or any other similar
state laws based on the Uniform Electronic Transactions Act; provided that
nothing herein shall require the Administrative Agent to accept electronic
signatures in any form or format without its prior written consent.

SECTION 9.07. Severability. Any provision of any Loan Document held to be
invalid, illegal or unenforceable in any jurisdiction shall, as to such
jurisdiction, be ineffective to the extent of such invalidity, illegality or
unenforceability without affecting the validity, legality and enforceability of
the remaining provisions thereof; and the invalidity of a particular provision
in a particular jurisdiction shall not invalidate such provision in any other
jurisdiction.

SECTION 9.08. Right of Setoff. If an Event of Default shall have occurred and be
continuing, each Lender, the Issuing Bank and each of their respective
Affiliates is hereby authorized at any time and from time to time, to the
fullest extent permitted by law, to set off and apply any and all deposits
(general

 

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or special, time or demand, provisional or final) at any time held, and other
obligations at any time owing, by such Lender, the Issuing Bank or any such
Affiliate, to or for the credit or the account of any Loan Party against any and
all of the Secured Obligations held by such Lender, the Issuing Bank or their
respective Affiliates, irrespective of whether or not such Lender, the Issuing
Bank or their respective Affiliates shall have made any demand under the Loan
Documents and although such obligations may be contingent or unmatured or are
owed to a branch office or Affiliate of such Lender or the Issuing Bank
different from the branch office or Affiliate holding such deposit or obligated
on such indebtedness; provided that in the event that any Defaulting Lender
shall exercise any such right of setoff, (x) all amounts so set off shall be
paid over immediately to the Administrative Agent for further application in
accordance with the provisions of Section 2.20 and, pending such payment, shall
be segregated by such Defaulting Lender from its other funds and deemed held in
trust for the benefit of the Administrative Agent, the Issuing Bank, and the
Lenders, and (y) the Defaulting Lender shall provide promptly to the
Administrative Agent a statement describing in reasonable detail the Secured
Obligations owing to such Defaulting Lender as to which it exercised such right
of setoff. The applicable Lender, the Issuing Bank or such Affiliate shall
notify the Borrower Representative and the Administrative Agent of such setoff
or application, provided that any failure to give or any delay in giving such
notice shall not affect the validity of any such setoff or application under
this Section. The rights of each Lender, the Issuing Bank and their respective
Affiliates under this Section are in addition to other rights and remedies
(including other rights of setoff) that such Lender, the Issuing Bank or their
respective Affiliates may have.

SECTION 9.09. Governing Law; Jurisdiction; Consent to Service of Process.
(a) The Loan Documents (other than those containing a contrary express choice of
law provision) shall be governed by and construed in accordance with the
internal laws of the State of New York, but giving effect to federal laws
applicable to national banks.

(b) Each of the Lenders and the Administrative Agent hereby irrevocably and
unconditionally agrees that, notwithstanding the governing law provisions of any
applicable Loan Document, any claims brought against the Administrative Agent by
any Secured Party relating to this Agreement, any other Loan Document, the
Collateral or the consummation or administration of the transactions
contemplated hereby or thereby shall be construed in accordance with and
governed by the law of the State of New York.

(c) Each of the parties hereto hereby irrevocably and unconditionally submits,
for itself and its property, to the exclusive jurisdiction of any U.S. federal
or New York state court sitting in New York, New York, and any appellate court
from any thereof, in any action or proceeding arising out of or relating to any
Loan Documents, the transactions relating hereto or thereto, or for recognition
or enforcement of any judgment, and each of the parties hereto hereby
irrevocably and unconditionally agrees that all claims in respect of any such
action or proceeding may (and any such claims, cross-claims or third party
claims brought against the Administrative Agent or any of its Related Parties
may only) be heard and determined in such New York State or, to the extent
permitted by law, in such Federal court. Each of the parties hereto agrees that
a final judgment in any such action or proceeding shall be conclusive and may be
enforced in other jurisdictions by suit on the judgment or in any other manner
provided by law. Nothing in this Agreement or any other Loan Document shall
affect any right that the Administrative Agent, the Issuing Bank or any Lender
may otherwise have to bring any action or proceeding relating to this Agreement
or any other Loan Document against any Loan Party or its properties in the
courts of any jurisdiction.

(d) Each Loan Party hereby irrevocably and unconditionally waives, to the
fullest extent it may legally and effectively do so, any objection which it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement or any other Loan Document in any
court referred to in paragraph (c) of this Section. Each of the parties hereto
hereby irrevocably waives, to the fullest extent permitted by law, the defense
of an inconvenient forum to the maintenance of such action or proceeding in any
such court.

 

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(e) Each party to this Agreement irrevocably consents to service of process in
the manner provided for notices in Section 9.01. Nothing in this Agreement or
any other Loan Document will affect the right of any party to this Agreement to
serve process in any other manner permitted by law.

SECTION 9.10. WAIVER OF JURY TRIAL. EACH PARTY HERETO HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY RIGHT IT MAY HAVE TO A TRIAL BY
JURY IN ANY LEGAL PROCEEDING DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING
TO THIS AGREEMENT, ANY OTHER LOAN DOCUMENT OR THE TRANSACTIONS CONTEMPLATED
HEREBY OR THEREBY (WHETHER BASED ON CONTRACT, TORT OR ANY OTHER THEORY). EACH
PARTY HERETO (A) CERTIFIES THAT NO REPRESENTATIVE OR OTHER AGENT (INCLUDING ANY
ATTORNEY) OF ANY OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH
OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING
WAIVER AND (B) ACKNOWLEDGES THAT IT AND THE OTHER PARTIES HERETO HAVE BEEN
INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS
AND CERTIFICATIONS IN THIS SECTION.

SECTION 9.11. Headings. Article and Section headings and the Table of Contents
used herein are for convenience of reference only, are not part of this
Agreement and shall not affect the construction of, or be taken into
consideration in interpreting, this Agreement.

SECTION 9.12. Confidentiality. Each of the Administrative Agent, the Issuing
Bank and the Lenders agrees to maintain the confidentiality of the Information
(as defined below), except that Information may be disclosed (a) to its and its
Affiliates’ directors, officers, employees and agents, including accountants,
legal counsel and other advisors (it being understood that the Persons to whom
such disclosure is made will be informed of the confidential nature of such
Information and instructed to keep such Information confidential), (b) to the
extent requested by any Governmental Authority (including any self-regulatory
authority, such as the National Association of Insurance Commissioners), (c) to
the extent required by any Requirement of Law or by any subpoena or similar
legal process, (d) to any other party to this Agreement, (e) in connection with
the exercise of any remedies under this Agreement or any other Loan Document or
any suit, action or proceeding relating to this Agreement or any other Loan
Document or the enforcement of rights hereunder or thereunder, (f) subject to an
agreement containing provisions substantially the same as those of this Section,
to (i) any assignee of or Participant in, or any prospective assignee of or
Participant in, any of its rights or obligations under this Agreement or
(ii) any actual or prospective counterparty (or its advisors) to any swap or
derivative transaction relating to the Loan Parties and their obligations,
(g) with the consent of the Borrower Representative or (h) to the extent such
Information (1) becomes publicly available other than as a result of a breach of
this Section or (2) becomes available to the Administrative Agent, the Issuing
Bank or any Lender on a non-confidential basis from a source other than the
Borrowers, or (i) on a confidential basis to (1) any rating agency in connection
with rating any Borrower or its Subsidiaries or the credit facilities provided
for herein or (2) the CUSIP Service Bureau or any similar agency in connection
with the issuance and monitoring of identification numbers with respect to the
credit facilities provided for herein.

For the purposes of this Section, “Information” means all information received
from the Borrowers relating to the Borrowers or their business, other than any
such information that is available to the Administrative Agent, the Issuing Bank
or any Lender on a non-confidential basis prior to disclosure by the Borrowers
and other than information pertaining to this Agreement provided by arrangers to
data service providers, including league table providers, that serve the lending
industry; provided that, in the

 

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case of information received from the Borrowers after the date hereof, such
information is clearly identified at the time of delivery as confidential. Any
Person required to maintain the confidentiality of Information as provided in
this Section shall be considered to have complied with its obligation to do so
if such Person has exercised the same degree of care to maintain the
confidentiality of such Information as such Person would accord to its own
confidential information.

EACH LENDER ACKNOWLEDGES THAT INFORMATION (AS DEFINED IN THIS SECTION 9.12)
FURNISHED TO IT PURSUANT TO THIS AGREEMENT MAY INCLUDE MATERIAL NON-PUBLIC
INFORMATION CONCERNING THE PARENT, AND ITS AFFILIATES, THE OTHER LOAN PARTIES
AND THEIR RELATED PARTIES OR THEIR RESPECTIVE SECURITIES, AND CONFIRMS THAT IT
HAS DEVELOPED COMPLIANCE PROCEDURES REGARDING THE USE OF MATERIAL NON-PUBLIC
INFORMATION AND THAT IT WILL HANDLE SUCH MATERIAL NON-PUBLIC INFORMATION IN
ACCORDANCE WITH THOSE PROCEDURES AND APPLICABLE LAW, INCLUDING FEDERAL AND STATE
SECURITIES LAWS.

ALL INFORMATION, INCLUDING REQUESTS FOR WAIVERS AND AMENDMENTS, FURNISHED BY THE
BORROWERS OR THE ADMINISTRATIVE AGENT PURSUANT TO, OR IN THE COURSE OF
ADMINISTERING, THIS AGREEMENT WILL BE SYNDICATE-LEVEL INFORMATION, WHICH MAY
CONTAIN MATERIAL NON-PUBLIC INFORMATION ABOUT THE PARENT, THE LOAN PARTIES AND
THEIR RELATED PARTIES OR THEIR RESPECTIVE SECURITIES. ACCORDINGLY, EACH LENDER
REPRESENTS TO THE BORROWERS AND THE ADMINISTRATIVE AGENT THAT IT HAS IDENTIFIED
IN ITS ADMINISTRATIVE QUESTIONNAIRE A CREDIT CONTACT WHO MAY RECEIVE INFORMATION
THAT MAY CONTAIN MATERIAL NON-PUBLIC INFORMATION IN ACCORDANCE WITH ITS
COMPLIANCE PROCEDURES AND APPLICABLE LAW, INCLUDING FEDERAL AND STATE SECURITIES
LAWS.

SECTION 9.13. Several Obligations; Nonreliance; Violation of Law. The respective
obligations of the Lenders hereunder are several and not joint and the failure
of any Lender to make any Loan or perform any of its obligations hereunder shall
not relieve any other Lender from any of its obligations hereunder. Each Lender
hereby represents that it is not relying on or looking to any margin stock (as
defined in Regulation U of the Board) for the repayment of the Borrowings
provided for herein. Anything contained in this Agreement to the contrary
notwithstanding, neither the Issuing Bank nor any Lender shall be obligated to
extend credit to the Borrowers in violation of any Requirement of Law.

SECTION 9.14. USA PATRIOT Act. Each Lender that is subject to the requirements
of the USA PATRIOT Act hereby notifies each Loan Party that pursuant to the
requirements of the USA PATRIOT Act, it is required to obtain, verify and record
information that identifies such Loan Party, which information includes the name
and address of such Loan Party and other information that will allow such Lender
to identify such Loan Party in accordance with the USA PATRIOT Act.

SECTION 9.15. Disclosure. Each Loan Party, each Lender and the Issuing Bank
hereby acknowledges and agrees that the Administrative Agent and/or its
Affiliates from time to time may hold investments in, make other loans to or
have other relationships with any of the Loan Parties and their respective
Affiliates.

SECTION 9.16. Appointment for Perfection. Each Lender hereby appoints each other
Lender as its agent for the purpose of perfecting Liens, for the benefit of the
Administrative Agent and the other Secured Parties, in assets which, in
accordance with Article 9 of the UCC, the PPSA or any other applicable law can
be perfected only by possession or control. Should any Lender (other than the

 

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Administrative Agent) obtain possession or control of any such Collateral, such
Lender shall notify the Administrative Agent thereof, and, promptly upon the
Administrative Agent’s request therefor shall deliver such Collateral to the
Administrative Agent or otherwise deal with such Collateral in accordance with
the Administrative Agent’s instructions.

SECTION 9.17. Interest Rate Limitation. Notwithstanding anything herein to the
contrary, if at any time the interest rate applicable to any Loan, together with
all fees, charges and other amounts which are treated as interest on such Loan
under applicable law (collectively the “Charges”), shall exceed the maximum
lawful rate (the “Maximum Rate”) which may be contracted for, charged, taken,
received or reserved by the Lender holding such Loan in accordance with
applicable law, the rate of interest payable in respect of such Loan hereunder,
together with all Charges payable in respect thereof, shall be limited to the
Maximum Rate and, to the extent lawful, the interest and Charges that would have
been payable in respect of such Loan but were not payable as a result of the
operation of this Section shall be cumulated and the interest and Charges
payable to such Lender in respect of other Loans or periods shall be increased
(but not above the Maximum Rate therefor) until such cumulated amount, together
with interest thereon at the NYFRB Rate to the date of repayment, shall have
been received by such Lender.

SECTION 9.18. Marketing Consent. The Borrowers hereby authorize JPMCB and its
affiliates, at their respective sole expense, subject to prior review by the
Borrowers, to publish such tombstones and give such other publicity to this
Agreement as each may from time to time determine in its sole discretion. The
foregoing authorization shall remain in effect unless and until the Borrower
Representative notifies JPMCB in writing that such authorization is revoked.

SECTION 9.19. Acknowledgement and Consent to Bail-In of EEA Financial
Institutions. Notwithstanding anything to the contrary in any Loan Document or
in any other agreement, arrangement or understanding among any such parties,
each party hereto acknowledges that any liability of any EEA Financial
Institution arising under any Loan Document may be subject to the Write-Down and
Conversion Powers of an EEA Resolution Authority and agrees and consents to, and
acknowledges and agrees to be bound by:

(a) the application of any Write-Down and Conversion Powers by an EEA Resolution
Authority to any such liabilities arising hereunder which may be payable to it
by any party hereto that is an EEA Financial Institution; and

(b) the effects of any Bail-In Action on any such liability, including, if
applicable:

(i) a reduction in full or in part or cancellation of any such liability;

(ii) a conversion of all, or a portion of, such liability into shares or other
instruments of ownership in such EEA Financial Institution, its parent entity,
or a bridge institution that may be issued to it or otherwise conferred on it,
and that such shares or other instruments of ownership will be accepted by it in
lieu of any rights with respect to any such liability under this Agreement or
any other Loan Document; or

(iii) the variation of the terms of such liability in connection with the
exercise of the Write-Down and Conversion Powers of any EEA Resolution
Authority.

SECTION 9.20. No Fiduciary Duty, etc. (a) Each Borrower acknowledges and agrees,
and acknowledges its Subsidiaries’ understanding, that no Credit Party will have
any obligations except those obligations expressly set forth herein and in the
other Loan Documents and each Credit Party is acting solely in the capacity of
an arm’s length contractual counterparty to each Borrower with respect to the

 

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Loan Documents and the transactions contemplated herein and therein and not as a
financial advisor or a fiduciary to, or an agent of, any Borrower or any other
person. Each Borrower agrees that it will not assert any claim against any
Credit Party based on an alleged breach of fiduciary duty by such Credit Party
in connection with this Agreement and the transactions contemplated hereby.
Additionally, each Borrower acknowledges and agrees that no Credit Party is
advising any Borrower as to any legal, tax, investment, accounting, regulatory
or any other matters in any jurisdiction. Each Borrower shall consult with its
own advisors concerning such matters and shall be responsible for making its own
independent investigation and appraisal of the transactions contemplated herein
or in the other Loan Documents, and the Credit Parties shall have no
responsibility or liability to any Borrower with respect thereto.

(b) Each Borrower further acknowledges and agrees, and acknowledges its
Subsidiaries’ understanding, that each Credit Party, together with its
Affiliates, is a full service securities or banking firm engaged in securities
trading and brokerage activities as well as providing investment banking and
other financial services. In the ordinary course of business, any Credit Party
may provide investment banking and other financial services to, and/or acquire,
hold or sell, for its own accounts and the accounts of customers, equity, debt
and other securities and financial instruments (including bank loans and other
obligations) of, any Borrower and other companies with which any Borrower may
have commercial or other relationships. With respect to any securities and/or
financial instruments so held by any Credit Party or any of its customers, all
rights in respect of such securities and financial instruments, including any
voting rights, will be exercised by the holder of the rights, in its sole
discretion.

(c) In addition, each Borrower acknowledges and agrees, and acknowledges its
Subsidiaries’ understanding, that each Credit Party and its affiliates may be
providing debt financing, equity capital or other services (including financial
advisory services) to other companies in respect of which a Borrower may have
conflicting interests regarding the transactions described herein and otherwise.
No Credit Party will use confidential information obtained from any Borrower by
virtue of the transactions contemplated by the Loan Documents or its other
relationships with such Borrower in connection with the performance by such
Credit Party of services for other companies, and no Credit Party will furnish
any such information to other companies. Each Borrower also acknowledges that no
Credit Party has any obligation to use in connection with the transactions
contemplated by the Loan Documents, or to furnish to any Borrower, confidential
information obtained from other companies.

SECTION 9.21. Acknowledgement Regarding Any Supported QFCs. To the extent that
the Loan Documents provide support, through a guarantee or otherwise, for Swap
Agreements or any other agreement or instrument that is a QFC (such support “QFC
Credit Support” and each such QFC a “Supported QFC”), the parties acknowledge
and agree as follows with respect to the resolution power of the Federal Deposit
Insurance Corporation under the Federal Deposit Insurance Act and Title II of
the Dodd-Frank Wall Street Reform and Consumer Protection Act (together with the
regulations promulgated thereunder, the “U.S. Special Resolution Regimes”) in
respect of such Supported QFC and QFC Credit Support (with the provisions below
applicable notwithstanding that the Loan Documents and any Supported QFC may in
fact be stated to be governed by the laws of the State of New York and/or of the
United States or any other state of the United States):

In the event a Covered Entity that is party to a Supported QFC (each, a “Covered
Party”) becomes subject to a proceeding under a U.S. Special Resolution Regime,
the transfer of such Supported QFC and the benefit of such QFC Credit Support
(and any interest and obligation in or under such Supported QFC and such QFC
Credit Support, and any rights in property securing such Supported QFC or such
QFC Credit Support) from such Covered Party will be effective to the same extent
as the transfer would be effective under the U.S. Special Resolution Regime if
the Supported QFC and such QFC Credit Support (and any such interest, obligation
and rights in property) were governed by the laws of the United States or a
state of the United States. In the event a Covered Party or a BHC Act Affiliate
of a Covered

 

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Party becomes subject to a proceeding under a U.S. Special Resolution Regime,
Default Rights under the Loan Documents that might otherwise apply to such
Supported QFC or any QFC Credit Support that may be exercised against such
Covered Party are permitted to be exercised to no greater extent than such
Default Rights could be exercised under the U.S. Special Resolution Regime if
the Supported QFC and the Loan Documents were governed by the laws of the United
States or a state of the United States. Without limitation of the foregoing, it
is understood and agreed that rights and remedies of the parties with respect to
a Defaulting Lender shall in no event affect the rights of any Covered Party
with respect to a Supported QFC or any QFC Credit Support.

SECTION 9.22. Canadian Anti-Money Laundering Legislation. Each Loan Party
acknowledges that, pursuant to the Canadian Anti-Money Laundering &
Anti-Terrorism Legislation and other applicable anti-money laundering,
anti-terrorist financing, government sanction and “know your client” laws
(collectively, including any guidelines or orders thereunder, “AML
Legislation”), the Lender may be required to obtain, verify and record
information regarding the Loan Parties and their respective directors,
authorized signing officers, direct or indirect shareholders or other Persons in
control of the Loan Parties, and the transactions contemplated hereby. Each Loan
Party shall promptly provide all such information, including supporting
documentation and other evidence, as may be reasonably requested by any Lender
or any prospective assignee or participant of the Lender, in order to comply
with any applicable AML Legislation, whether now or hereafter in existence. If
the Administrative Agent has ascertained the identity of any Loan Party or any
authorized signatories of any Loan Party for the purposes of applicable AML
Legislation, then the Administrative Agent, (i) shall be deemed to have done so
as an agent for each Secured Party, and this Agreement shall constitute a
“written agreement” in such regard between each Secured Party and the
Administrative Agent within the meaning of the applicable AML Legislation; and
(ii) shall provide to each Secured Party copies of all information obtained in
such regard without any representation or warranty as to its accuracy or
completeness.

SECTION 9.23. Judgment Currency. If for the purpose of obtaining judgment in any
court it is necessary to convert an amount due hereunder in the currency in
which it is due (the “Original Currency”) into another currency (the “Second
Currency”), the rate of exchange applied shall be that at which, in accordance
with normal banking procedures, the Lender could purchase in the New York
foreign exchange market, the Original Currency with the Second Currency on the
date two (2) Business Days preceding that on which judgment is given. Each
Borrower agrees that its obligation in respect of any Original Currency due from
it hereunder shall, notwithstanding any judgment or payment in such other
currency, be discharged only to the extent that, on the Business Day following
the date the Lender receives payment of any sum so adjudged to be due hereunder
in the Second Currency, the Lender may, in accordance with normal banking
procedures, purchase, in the New York foreign exchange market, the Original
Currency with the amount of the Second Currency so paid; and if the amount of
the Original Currency so purchased or could have been so purchased is less than
the amount originally due in the Original Currency, each Borrower agrees as a
separate obligation and notwithstanding any such payment or judgment to
indemnify the Lender against such loss. The term “rate of exchange” in this
Section 9.23 means the spot rate at which the Lender, in accordance with normal
practices, is able on the relevant date to purchase the Original Currency with
the Second Currency, and includes any premium and costs of exchange payable in
connection with such purchase.

 

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ARTICLE X

Loan Guaranty.

SECTION 10.01. Guaranty. Each Loan Guarantor (other than those that have
delivered a separate Guaranty) hereby agrees that it is jointly and severally
liable for, and, as a primary obligor and not merely as surety, absolutely,
unconditionally and irrevocably guarantees to the Secured Parties, the prompt
payment when due, whether at stated maturity, upon acceleration or otherwise,
and at all times thereafter, of the Secured Obligations and all costs and
expenses, including, without limitation, all court costs and attorneys’ and
paralegals’ fees (including allocated costs of in-house counsel and paralegals)
and expenses paid or incurred by the Administrative Agent, the Issuing Bank and
the Lenders in endeavoring to collect all or any part of the Secured Obligations
from, or in prosecuting any action against, any Borrower, any Loan Guarantor or
any other guarantor of all or any part of the Secured Obligations (such costs
and expenses, together with the Secured Obligations, collectively the
“Guaranteed Obligations”; provided, however, that the definition of “Guaranteed
Obligations” shall not create any guarantee (x) by any Loan Guarantor of (or
grant of security interest by any Loan Guarantor to support, as applicable) any
Excluded Swap Obligations of such Loan Guarantor for purposes of determining any
obligations of any Loan Guarantor) or (y) by any Loan Guarantor (other than the
Parent) of any of the Secured Obligations owing by the Parent. Each Loan
Guarantor further agrees that the Guaranteed Obligations may be extended or
renewed in whole or in part without notice to or further assent from it, and
that it remains bound upon its guarantee notwithstanding any such extension or
renewal. All terms of this Loan Guaranty apply to and may be enforced by or on
behalf of any domestic or foreign branch or Affiliate of any Lender that
extended any portion of the Guaranteed Obligations.

SECTION 10.02. Guaranty of Payment. This Loan Guaranty is a guaranty of payment
and not of collection. Each Loan Guarantor waives any right to require the
Administrative Agent, the Issuing Bank or any Lender to sue any Borrower, any
Loan Guarantor, any other guarantor of, or any other Person obligated for, all
or any part of the Guaranteed Obligations (each, an “Obligated Party”), or
otherwise to enforce its payment against any collateral securing all or any part
of the Guaranteed Obligations.

SECTION 10.03. No Discharge or Diminishment of Loan Guaranty. (a) Except as
otherwise provided for herein, the obligations of each Loan Guarantor hereunder
are unconditional and absolute and not subject to any reduction, limitation,
impairment or termination for any reason (other than Payment in Full of the
Guaranteed Obligations), including: (i) any claim of waiver, release, extension,
renewal, settlement, surrender, alteration or compromise of any of the
Guaranteed Obligations, by operation of law or otherwise; (ii) any change in the
corporate existence, structure or ownership of any Borrower or any other
Obligated Party liable for any of the Guaranteed Obligations; (iii) any
insolvency, bankruptcy, winding-up, liquidation, reorganization or other similar
proceeding affecting any Obligated Party or their assets or any resulting
release or discharge of any obligation of any Obligated Party; or (iv) the
existence of any claim, setoff or other rights which any Loan Guarantor may have
at any time against any Obligated Party, the Administrative Agent, the Issuing
Bank, any Lender or any other Person, whether in connection herewith or in any
unrelated transactions.

(b) The obligations of each Loan Guarantor hereunder are not subject to any
defense or setoff, counterclaim, recoupment or termination whatsoever by reason
of the invalidity, illegality or unenforceability of any of the Guaranteed
Obligations or otherwise, or any provision of applicable law or regulation
purporting to prohibit payment by any Obligated Party, of the Guaranteed
Obligations or any part thereof.

(c) Further, the obligations of any Loan Guarantor hereunder are not discharged
or impaired or otherwise affected by: (i) the failure of the Administrative
Agent, the Issuing Bank or any Lender to assert any claim or demand or to
enforce any remedy with respect to all or any part of the Guaranteed
Obligations; (ii) any waiver or modification of or supplement to any provision
of any agreement relating to the Guaranteed Obligations; (iii) any release,
non-perfection or invalidity of any indirect or direct security for the
obligations of any Borrower for all or any part of the Guaranteed Obligations or
any obligations of any other Obligated Party liable for any of the Guaranteed
Obligations; (iv) any action or failure to act by the Administrative Agent, the
Issuing Bank or any Lender with respect to any collateral securing any part of
the Guaranteed Obligations; or (v) any default, failure or delay, willful or
otherwise,

 

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in the payment or performance of any of the Guaranteed Obligations, or any other
circumstance, act, omission or delay that might in any manner or to any extent
vary the risk of such Loan Guarantor or that would otherwise operate as a
discharge of any Loan Guarantor as a matter of law or equity (other than Payment
in Full of the Guaranteed Obligations).

SECTION 10.04. Defenses Waived. To the fullest extent permitted by applicable
law, each Loan Guarantor hereby waives any defense based on or arising out of
any defense of any Borrower or any Loan Guarantor or the unenforceability of all
or any part of the Guaranteed Obligations from any cause, or the cessation from
any cause of the liability of any Borrower, any Loan Guarantor or any other
Obligated Party, other than Payment in Full of the Guaranteed Obligations.
Without limiting the generality of the foregoing, each Loan Guarantor
irrevocably waives acceptance hereof, presentment, demand, protest and, to the
fullest extent permitted by law, any notice not provided for herein, as well as
any requirement that at any time any action be taken by any Person against any
Obligated Party or any other Person. Each Loan Guarantor confirms that it is not
a surety under any state law and shall not raise any such law as a defense to
its obligations hereunder. The Administrative Agent may, at its election,
foreclose on any Collateral held by it by one or more judicial or nonjudicial
sales, accept an assignment of any such Collateral in lieu of foreclosure or
otherwise act or fail to act with respect to any collateral securing all or a
part of the Guaranteed Obligations, compromise or adjust any part of the
Guaranteed Obligations, make any other accommodation with any Obligated Party or
exercise any other right or remedy available to it against any Obligated Party,
without affecting or impairing in any way the liability of such Loan Guarantor
under this Loan Guaranty except to the extent the Guaranteed Obligations have
been Paid in Full. To the fullest extent permitted by applicable law, each Loan
Guarantor waives any defense arising out of any such election even though that
election may operate, pursuant to applicable law, to impair or extinguish any
right of reimbursement or subrogation or other right or remedy of any Loan
Guarantor against any Obligated Party or any security.

SECTION 10.05. Rights of Subrogation. No Loan Guarantor will assert any right,
claim or cause of action, including, without limitation, a claim of subrogation,
contribution or indemnification, that it has against any Obligated Party or any
collateral, until the Loan Parties and the Loan Guarantors have fully performed
all their obligations to the Administrative Agent, the Issuing Bank and the
Lenders.

SECTION 10.06. Reinstatement; Stay of Acceleration. If at any time any payment
of any portion of the Guaranteed Obligations (including a payment effected
through exercise of a right of setoff) is rescinded, or must otherwise be
restored or returned upon the insolvency, bankruptcy or reorganization of any
Borrower or otherwise (including pursuant to any settlement entered into by a
Secured Party in its discretion), each Loan Guarantor’s obligations under this
Loan Guaranty with respect to that payment shall be reinstated at such time as
though the payment had not been made and whether or not the Administrative
Agent, the Issuing Bank and the Lenders are in possession of this Loan Guaranty.
If acceleration of the time for payment of any of the Guaranteed Obligations is
stayed upon the insolvency, bankruptcy or reorganization of any Borrower, all
such amounts otherwise subject to acceleration under the terms of any agreement
relating to the Guaranteed Obligations shall nonetheless be payable by the Loan
Guarantors forthwith on demand by the Administrative Agent.

SECTION 10.07. Information. Each Loan Guarantor assumes all responsibility for
being and keeping itself informed of the Borrowers’ financial condition and
assets, and of all other circumstances bearing upon the risk of nonpayment of
the Guaranteed Obligations and the nature, scope and extent of the risks that
each Loan Guarantor assumes and incurs under this Loan Guaranty, and agrees that
none of the Administrative Agent, the Issuing Bank or any Lender shall have any
duty to advise any Loan Guarantor of information known to it regarding those
circumstances or risks.

 

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SECTION 10.08. Termination. Each of the Lenders and the Issuing Bank may
continue to make loans or extend credit to the Borrowers based on this Loan
Guaranty until five (5) days after it receives written notice of termination
from any Loan Guarantor. Notwithstanding receipt of any such notice, each Loan
Guarantor will continue to be liable to the Lenders for any Guaranteed
Obligations created, assumed or committed to prior to the fifth day after
receipt of the notice, and all subsequent renewals, extensions, modifications
and amendments with respect to, or substitutions for, all or any part of such
Guaranteed Obligations. Nothing in this Section 10.08 shall be deemed to
constitute a waiver of, or eliminate, limit, reduce or otherwise impair any
rights or remedies the Administrative Agent or any Lender may have in respect
of, any Default or Event of Default that shall exist under clause (o) of Article
VII hereof as a result of any such notice of termination.

SECTION 10.09. Taxes. Each payment of the Guaranteed Obligations will be made by
each Loan Guarantor without withholding for any Taxes, unless such withholding
is required by law. If any Loan Guarantor determines, in its sole discretion
exercised in good faith, that it is so required to withhold Taxes, then such
Loan Guarantor may so withhold and shall timely pay the full amount of withheld
Taxes to the relevant Governmental Authority in accordance with applicable law.
If such Taxes are Indemnified Taxes, then the amount payable by such Loan
Guarantor shall be increased as necessary so that, net of such withholding
(including such withholding applicable to additional amounts payable under this
Section), the Administrative Agent, Lender or Issuing Bank (as the case may be)
receives the amount it would have received had no such withholding been made.

SECTION 10.10. Maximum Liability. Notwithstanding any other provision of this
Loan Guaranty, the amount guaranteed by each Loan Guarantor hereunder shall be
limited to the extent, if any, required so that its obligations hereunder shall
not be subject to avoidance under Section 548 of the Bankruptcy Code or under
any applicable state Uniform Fraudulent Transfer Act, Uniform Fraudulent
Conveyance Act, Uniform Voidable Transactions Act or similar statute or common
law. In determining the limitations, if any, on the amount of any Loan
Guarantor’s obligations hereunder pursuant to the preceding sentence, it is the
intention of the parties hereto that any rights of subrogation, indemnification
or contribution which such Loan Guarantor may have under this Loan Guaranty, any
other agreement or applicable law shall be taken into account.

SECTION 10.11. Contribution.

(a) To the extent that any Loan Guarantor shall make a payment under this Loan
Guaranty (a “Guarantor Payment”) which, taking into account all other Guarantor
Payments then previously or concurrently made by any other Loan Guarantor,
exceeds the amount which otherwise would have been paid by or attributable to
such Loan Guarantor if each Loan Guarantor had paid the aggregate Guaranteed
Obligations satisfied by such Guarantor Payment in the same proportion as such
Loan Guarantor’s “Allocable Amount” (as defined below) (as determined
immediately prior to such Guarantor Payment) bore to the aggregate Allocable
Amounts of each of the Loan Guarantors as determined immediately prior to the
making of such Guarantor Payment, then, following indefeasible payment in full
in cash of the Guarantor Payment and the Payment in Full of the Guaranteed
Obligations and the termination of this Agreement, such Loan Guarantor shall be
entitled to receive contribution and indemnification payments from, and be
reimbursed by, each other Loan Guarantor for the amount of such excess, pro rata
based upon their respective Allocable Amounts in effect immediately prior to
such Guarantor Payment.

(b) As of any date of determination, the “Allocable Amount” of any Loan
Guarantor shall be equal to the excess of the fair saleable value of the
property of such Loan Guarantor over the total liabilities of such Loan
Guarantor (including the maximum amount reasonably expected to become due in
respect of contingent liabilities, calculated, without duplication, assuming
each other Loan Guarantor that is also liable for such contingent liability pays
its ratable share thereof), giving effect to all payments made by other Loan
Guarantors as of such date in a manner to maximize the amount of such
contributions.

 

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(c) This Section 10.11 is intended only to define the relative rights of the
Loan Guarantors, and nothing set forth in this Section 10.11 is intended to or
shall impair the obligations of the Loan Guarantors, jointly and severally, to
pay any amounts as and when the same shall become due and payable in accordance
with the terms of this Loan Guaranty.

(d) The parties hereto acknowledge that the rights of contribution and
indemnification hereunder shall constitute assets of the Loan Guarantor or Loan
Guarantors to which such contribution and indemnification is owing.

(e) The rights of the indemnifying Loan Guarantors against other Loan Guarantors
under this Section 10.11 shall be exercisable upon the Payment in Full of the
Guaranteed Obligations and the termination of this Agreement.

SECTION 10.12. Liability Cumulative. The liability of each Loan Party as a Loan
Guarantor under this Article X is in addition to and shall be cumulative with
all liabilities of each Loan Party to the Administrative Agent, the Issuing Bank
and the Lenders under this Agreement and the other Loan Documents to which such
Loan Party is a party or in respect of any obligations or liabilities of the
other Loan Parties, without any limitation as to amount, unless the instrument
or agreement evidencing or creating such other liability specifically provides
to the contrary.

SECTION 10.13. Keepwell. Each Qualified ECP Guarantor hereby jointly and
severally absolutely, unconditionally and irrevocably undertakes to provide such
funds or other support as may be needed from time to time by each other Loan
Party to honor all of its obligations under this Guarantee in respect of a Swap
Obligation (provided, however, that each Qualified ECP Guarantor shall only be
liable under this Section 10.13 for the maximum amount of such liability that
can be hereby incurred without rendering its obligations under this
Section 10.13 or otherwise under this Loan Guaranty voidable under applicable
law relating to fraudulent conveyance or fraudulent transfer, and not for any
greater amount). Except as otherwise provided herein, the obligations of each
Qualified ECP Guarantor under this Section 10.13 shall remain in full force and
effect until the termination of all Swap Obligations. Each Qualified ECP
Guarantor intends that this Section 10.13 constitute, and this Section 10.13
shall be deemed to constitute, a “keepwell, support, or other agreement” for the
benefit of each other Loan Party for all purposes of Section 1a(18)(A)(v)(II) of
the Commodity Exchange Act.

SECTION 10.14. Releases.

(a) A Guarantee of a Guarantor (other than a Borrower or the Parent) will be
automatically and unconditionally released (and thereupon shall terminate and be
discharged and be of no further force and effect):

(i) in connection with any sale or other Disposition (including by merger or
otherwise) of (x) capital stock of the Guarantor or (y) all or substantially all
of the assets of such Guarantor, in each case if (i) such sale or other
Disposition (including by merger or otherwise) is permitted hereunder and
(ii) following which such Guarantor is no longer a Subsidiary;

(ii) upon the merger, consolidation or amalgamation of any Guarantor with and
into the Parent, a Borrower or any other Loan Party and that is the surviving
Person in such merger, consolidation or amalgamation, or upon the liquidation of
such Guarantor following the transfer of all of its assets to the Parent or its
Subsidiary; provided that any Guarantor that survives any such transaction or is
the transferee of assets of such a Guarantor remains a Guarantor;

 

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(iii) upon Payment in Full; or

(iv) if the Borrower Representative has determined, reasonably and in good
faith, that (i) a Foreign Subsidiary acting as a Loan Guarantor is not
practicable (including as a result of local law in the jurisdiction in which
such Foreign Subsidiary is organized or other applicable law, rule or
regulation) or (ii) the burden or cost (including any costs resulting from
material adverse tax consequences) of a Foreign Subsidiary providing such
guarantee outweighs the benefit of the guaranty afforded thereby. It is
understood for purposes of the foregoing that any such Guarantee may be released
due to material adverse U.S. federal income tax consequences only if such
consequences arise as a result of a change in law occurring after the Effective
Date, including, for the avoidance of doubt, a change to the Proposed
Regulations under Section 956 of the Code, as amended, published on November 5,
2018.

(b) The Guarantee by the Parent will be automatically and unconditionally
released (and thereupon shall terminate and be discharged and be of no further
force and effect):

(i) upon the merger, consolidation or amalgamation of the Parent with and into a
Borrower or any other Loan Party that is the surviving Person in such merger,
consolidation or amalgamation, or upon the liquidation of the Parent following
the transfer of all of its assets to the Borrowers or a Subsidiary, in each
case, if such transfer sale or other Disposition (including by merger or
otherwise) is permitted by this Agreement and such surviving Person or
transferee remains a Guarantor or a Borrower after completion of such
transaction; or

(ii) upon Payment in Full.

(c) Upon any occurrence giving rise to a release of a Guarantee as specified
above, the Administrative Agent will, at the direction of and sole cost of the
Company, execute any documents reasonably requested by the Borrower
Representative in order to evidence or effect such release, termination and
discharge in respect of the Guarantee. Upon any release of a Guarantor from its
Guarantee, such Guarantor shall also be released from its obligations under the
Collateral Documents and the Secured Notes Intercreditor Agreement, subject to
the provisions of Section 9.02(c).

(d) Any release of a Guarantor that is a Borrowing Base Party shall be subject
to Section 5.10(g).

ARTICLE XI

The Borrower Representative.

SECTION 11.01. Appointment; Nature of Relationship. Gogo Intermediate Holdings
LLC is hereby appointed by each of the Borrowers as its contractual
representative (herein referred to as the “Borrower Representative”) hereunder
and under each other Loan Document, and each of the Borrowers irrevocably
authorizes the Borrower Representative to act as the contractual representative
of such Borrower with the rights and duties expressly set forth herein and in
the other Loan Documents. The Borrower Representative agrees to act as such
contractual representative upon the express conditions contained in this Article
XI. Additionally, the Borrowers hereby appoint the Borrower Representative as
their agent to receive all of the proceeds of the Loans in the Funding
Account(s), at which time the Borrower Representative shall promptly disburse
such Loans to the appropriate Borrower(s), provided

 

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that, in the case of a Revolving Loan, such amount shall not exceed
Availability. The Administrative Agent and the Lenders, and their respective
officers, directors, agents or employees, shall not be liable to the Borrower
Representative or any Borrower for any action taken or omitted to be taken by
the Borrower Representative or the Borrowers pursuant to this Section 11.01.

SECTION 11.02. Powers. The Borrower Representative shall have and may exercise
such powers under the Loan Documents as are specifically delegated to the
Borrower Representative by the terms of each thereof, together with such powers
as are reasonably incidental thereto. The Borrower Representative shall have no
implied duties to the Borrowers, or any obligation to the Lenders to take any
action thereunder except any action specifically provided by the Loan Documents
to be taken by the Borrower Representative.

SECTION 11.03. Employment of Agents. The Borrower Representative may execute any
of its duties as the Borrower Representative hereunder and under any other Loan
Document by or through authorized officers.

SECTION 11.04. Notices. Each Borrower shall immediately notify the Borrower
Representative of the occurrence of any Default or Event of Default hereunder
referring to this Agreement describing such Default or Event of Default and
stating that such notice is a “notice of default”. In the event that the
Borrower Representative receives such a notice, the Borrower Representative
shall give prompt notice thereof to the Administrative Agent and the Lenders.
Any notice provided to the Borrower Representative hereunder shall constitute
notice to each Borrower on the date received by the Borrower Representative.

SECTION 11.05. Successor Borrower Representative. Upon the prior written consent
of the Administrative Agent, the Borrower Representative may resign at any time,
such resignation to be effective upon the appointment of a successor Borrower
Representative. The Administrative Agent shall give prompt written notice of
such resignation to the Lenders.

SECTION 11.06. Execution of Loan Documents; Borrowing Base Certificate. The
Borrowers hereby empower and authorize each of the Parent and the Borrower
Representative, on behalf of the Borrowers, to execute and deliver to the
Administrative Agent and the Lenders the Loan Documents and all related
agreements, certificates, documents, or instruments as shall be necessary or
appropriate to effect the purposes of the Loan Documents, including, without
limitation, the Borrowing Base Certificates and the Compliance Certificates.
Each Borrower agrees that any action taken by the Parent, the Borrower
Representative or the Borrowers in accordance with the terms of this Agreement
or the other Loan Documents, and the exercise by the Parent or the Borrower
Representative of its powers set forth therein or herein, together with such
other powers that are reasonably incidental thereto, shall be binding upon all
of the Borrowers.

(Signature Pages Follow)

 

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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed and delivered by their respective authorized officers as of the day and
year first above written.

 

GOGO INTERMEDIATE HOLDINGS LLC, as a Borrower and a Loan Party By:   /s/ Barry
Rowan   Name: Barry Rowan   Title: Chief Financial Officer

 

GOGO FINANCE CO. INC., as a Borrower and a Loan Party By:   /s/ Barry Rowan  
Name: Barry Rowan   Title: Chief Financial Officer

Gogo ABL Credit Agreement

--------------------------------------------------------------------------------

OTHER LOAN GUARANTORS AND LOAN PARTIES: GOGO INC., as the Parent and a Loan
Party By:   /s/ Barry Rowan   Name: Barry Rowan   Title: Chief Financial Officer

 

AC BIDCO LLC, as a Loan Party By:   /s/ Barry Rowan   Name: Barry Rowan   Title:
Chief Financial Officer

 

GOGO LLC, as a Loan Party By:   /s/ Barry Rowan   Name: Barry Rowan   Title:
Chief Financial Officer

 

GOGO BUSINESS AVIATION LLC, as a Loan Party By:   /s/ Barry Rowan   Name: Barry
Rowan   Title: Chief Financial Officer

 

GOGO INTERNATIONAL HOLDINGS LLC, as a Loan Party By:   /s/ Barry Rowan   Name:
Barry Rowan   Title: Chief Financial Officer

 

GOGO CONNECTIVITY LTD. , as a Loan Party By:   /s/ Barry Rowan   Name: Barry
Rowan   Title: Chief Financial Officer

Gogo ABL Credit Agreement

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JPMORGAN CHASE BANK, N.A., individually and as Administrative Agent, Issuing
Bank and Swingline Lender By:   /s/ Daglas Panchal   Name: Daglas Panchal  
Title: Authorized Officer

Gogo ABL Credit Agreement

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MORGAN STANLEY SENIOR FUNDING, INC., as a Lender By:   /s/ Michael King   Name:
Michael King   Title: Vice President

Gogo ABL Credit Agreement